To support the Executive Order, OPM will work with carriers in the Federal Employees Health Benefits Program to meet four goals:

1. Transparency in pricing. OPM will work with carriers to make available to FEHBP enrollees information about the cost of services delivered by various providers. This information will be combined with quality information so that enrollees can see quality and price information together in single, easy-to-use sources.
2. Transparency in quality. OPM will work with carriers to make available information on the performance of doctors, hospitals and other health care providers. They will use quality measures that have been developed collaboratively with the health care sector, to help ensure accuracy and fairness.
3. Effective health IT standards. To ensure that quality and price information can be rapidly exchanged and easily shared, OPM will work with carriers to encourage carriers to make health information technology systems interoperable – capable of exchanging information.
4. Provide insurance options that reward cost-conscious consumers – OPM will continue to work with carriers to ensure that FEHBP enrollees are able to access innovative health insurance options that allow consumers to share in the savings, in the form of lower premiums and more effective care, when they take part in making choices.

Implementing Healthcare Transparency

We have taken steps to raise the level of price and quality transparency in the FEHB Program. In April, we issued our annual “call letter” to FEHB carriers seeking their proposals on ways in which to make pricing information available to enrollees. We also met with a number of carriers to discuss their transparency initiatives. Based on those discussions, we established best practices for carriers to meet if they are to be designated by OPM as meeting or exceeding our price transparency goals

We are rating each carrier’s compliance with our expectations on best practices and will determine which carriers will be highlighted in OPM’s Guide to Federal Employees Health Plans issued this fall prior to the November open season.

OPM is also working to provide quality transparency within the FEHB Program. The Health Plan Employer Data and Information Set (HEDIS) is the performance measurement tool of choice for more than 90 percent of the nation’s managed care organizations. It is a set of standardized measures that specifies how health plans collect, audit and report on their performance in important areas ranging from breast cancer screening, to cholesterol control, to customer satisfaction. Purchasers and others use HEDIS data to compare plan performance. We have long required contracting HMOs to submit HEDIS measures as evidence of high quality performance. For 2007, we are requiring fee-for-service plans to collect data on certain HEDIS administrative measures that have already been tested and determined to be feasible for PPO reporting. We will also be working with health carriers to publish provider quality information for their members to review.

What this means to employees, retirees and their families: Access to provider pricing will help enrollees understand the true cost of their healthcare, allowing them to be better consumers. Patients will be able to know, by procedure or type of illness, which hospitals, physicians and other providers meet established, industry-accepted quality standards.

Health Information Technology

OPM has included HIT initiatives in its annual “call letter” since 2005. In this year’s letter, we advised FEHB carriers to work toward the following short-term objectives:

1. Enhance educational efforts to make plan members more aware of how HIT can help improve quality and control costs over the long term;
2. Offer personal health records to enrollees based on their claims, medications and medical history information currently available in carrier healthcare systems;
3. Encourage pharmacy benefit managers to provide incentives for ePrescribing;
4. Link disease management programs to HIT; and,
5. Ensure compliance with Federal requirements to protect the privacy of individually identifiable health information.

We also advised carriers that adoption of HIT requirements will be an element of our plan performance review within the next two to four years. We asked carriers to describe how they have already expanded on HIT initiatives during 2005 and to provide business plans for accelerating HIT in 2006 and 2007, including action items and milestones.

During the 2006 Open Season, OPM will expand its website to provide additional information regarding the HIT capabilities of participating plans so that prospective enrollees can review this information in making their health plan choices for 2007, and OPM will highlight plans that are able to provide evidence of state-of-the-art HIT capabilities.

What this means to employees, retirees and their families: Health information technology, based on broadly accepted standards, will allow patients, health care providers and payers (insurance carriers) share information securely, driving down costs by avoiding duplicate procedures and manual transactions. More importantly, HIT will reduce medical errors; for instance, from misread, handwritten prescriptions and emergency care medical decisions made without complete and accurate information. Since privacy and security considerations are central to Federal HIT implementation plans, patient records will be safe from inappropriate disclosure.

Health Savings Accounts – current actions and legislation

Health Savings Accounts (HSA) represent a key element of OPM’s healthcare agenda. Currently, FEHB enrollees have up to 27 choices of high deductible health plans (HDHP) with HSAs (or health reimbursement accounts (HRA) for those not eligible for an HSA). OPM first offered HDHPs in 2005 and about 6500 have enrolled to date. In our “call letter” we encouraged FEHB carriers to submit proposals to expand the availability of this consumer option. We will offer even more HDHP choices for 2007.

OPM is also taking steps to enable HDHP enrollees to make additional pre-tax contributions to their HSAs via payroll allotments as early as 2007. We believe this initiative will help to promote more interest among FEHB enrollees who are committed to saving for their future medical expenses.

What this means to employees, retirees and their families: Enrollees have more choice. Now they can choose among fee-for-service, HMO, consumer driven health plans, and high deductible health plans with health savings accounts. The newer plans give enrollees, through their health accounts, greater control over how their health care dollars are spent.

Stakeholder Collaboration

OPM is a member of the American Health Information Community’s (AHIC) Consumer Empowerment Workgroup. The Secretary of HHS created the AHIC to recommend specific actions to achieve a common framework for health IT to allow appropriate information among health care providers and payers. AHIC meetings are also forum for participation in sitting HIT policy by a broad range of stakeholders.

OPM is currently working with the AHIC and the HHS Office of the National Coordinator of Health Information Technology to develop electronic patient registration systems and medication histories and to promote the widespread adoption of personal health records. OPM is currently participating on subgroups to address issues such as privacy and security, transparency in cost and quality, and contract language to ensure a common set of standards be used for personal and electronic health records.