GAO Report on FEHBP

Yesterday the Government Accountability Office issued a report on the FEHBP titled “Enrollment Remains Concentrated Despite More Plan Offerings and Effects of Adding Plan Types Are Uncertain.” The Federal Times, Govexec, Federal News RadioFedSmith, and Health Payer Intelligence all provide their perspectives on the report. 

GAO certainly is skeptical as to whether adding new plan types like regional PPO plans would improve competition in the FEHBP.  At least for the past two years, no new carrier has joined the FEHBP. In the FEHBlog’s view, the problem is that OPM does not offer an inviting competitive environment. OPM, for example, has introduced a new plan performance system which offer a limited reward to the HMO carriers and imposes a financial penalty on others.  The financial penalty necessarily is a deterrent to new carriers.