News Release

OPM Official Addresses Business Roundtable; Agency Highlights Efforts to Hold Down FEHB Costs

Washington, D.C. - The U.S. Office of Personnel Management in an expanding effort to study and incorporate private sector best practice recommendations, highlighted a new effort, a "user education" program, as part of Bush Administration initiatives designed to help hold down premiums and health-care costs in the Federal Employees Health Benefits Program (FEHB).

Ed Flynn, senior policy advisor to OPM Director Kay Coles James, speaking on behalf of Director James told attendees at a Business Roundtable Meeting that the education program is the "fifth pillar" of a successful strategy begun this year. The education program will be based on best practice in the private sector.

"Actively educating employees and retirees on healthy-living strategies can help keep costs down and ensure benefit dollars are spent wisely," said Flynn.

Flynn's remarks were in reference to a Consumer Driven Option introduced into the FEHB Program for 2003. The option, part of the American Postal Worker's Union health plan, gives enrollees and their families an up-front medical allowance of up to $2,000 before any out-of-pocket expenses are paid. If the allowance is depleted, enrollees must meet a deductible before standard co-payments and coverages apply, thereby encouraging smart expenditure of the up-front allowance.

Flynn emphasized OPM's tough negotiations with FEHB carriers and Director James' support of the agency's Inspector General to uncover fraud within the health-care program as contributing factors in holding down the 2003 average premium increase to 11.1 percent, which is among the lowest in the nation.

As part of its efforts to lower costs within the FEHB program, Director James is working closely with FEHB partners to encourage greater health education and a better understanding of medical services utilization. Messages and practical information aimed at helping employees and retirees with decisions on diet, exercise and preventive health screening will be provided throughout the coming year.

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OPM oversees the federal work force and provides the American public with up-to-date employment information. OPM also supports U.S. agencies with personnel services and policy leadership including staffing tools, guidance on labor-management relations and programs to improve work force performance.

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