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OPM filling holes left by retirement system failure
Wednesday - 4/27/2011, 7:35am EDT
Federal News Radio
The Office of Personnel Management still is overcoming the effects of the failed Retirement Systems Modernization program.
Despite the fact OPM cancelled a major portion of the nearly $300 million contract in 2008, the agency started only in February filling staffing holes that officials believed would no longer be needed because of the automated system.
OPM officials reduced its staff by 40 percent with the expectation that RSM would make up for the lost capacity.
Now with an unexpected influx of claims from federal employees retiring starting in January, OPM is facing a backlog of 43,000 claims from feds who want their pensions and a shortage of workers to process the paperwork.
"RSM was intended to provide us with more capacity for processing claims," said William Zielinski, OPM's associate director in the Office of Retirement Services in an interview with Federal News Radio. "That project didn't work well and the program was cancelled. Because we expected it to provide us with more capacity, there was reduction in staff going in to the implementation of the RetireEZ portion of RSM. When the program was cancelled, we had less staff on hand than previously."
But despite the staffing and budget challenges, Zielinski said OPM is finding other ways to overcome the backlog and get annuitants their money faster and with more accuracy.
"It now takes 117 days on average to process a claim and that is 15 percent less than 6 months ago," he said. "Neither of numbers [average days and claims backlog] are where we want them to be, but we are making progress in reducing the balance."
Zielinski added that OPM received 22 percent more claims between January and March than the previous year, and 70 percent of the 43,000 delayed claims have been in the process for less than 90 days.
The time it takes to get annuitants their pensions has been a problem for OPM.
"Traditionally, we've shifted or moved employees internally to deal with influx of claims," he said. "But what was the case this past year, we had an influx of claims that didn't allow us to do that and that caused the additional balance."
He said in the short term OPM uses additional overtime and detailed staff in from other areas to help process the claims.
In the long term, OPM has hired and is training 40 new employees that by June should be able to help out on the most straightforward claims processing. By 2012, Zielinski said they should be up to speed to ensure there is no or little claims backlog.
Meanwhile, Zielinski said OPM is taking other steps to ensure retired federal employees receive as close to their full annuity as possible and as soon as possible.
"We have placed more focus on the claims process itself," he said. "We have been working more closely with agencies and federal payroll providers to drive efficiencies. The retirement claim starts with the employee's agency and they build the claim, and then they transfer the information to us. We find that 30 percent of all claims have some level of inaccuracies or some level of incompleteness so OPM is working with agencies to help them understand where there are inaccuracies or incompleteness."
Zielinski added OPM conducts audits and includes the areas where agencies are having problems in training sessions for agency retirement officials and its own claims processors.
And later this summer, OPM will improve the online services for annuitants it offers.
"From the point of time when they first make their claim and OPM is aware of it, annuitants will be able to find out the status of their claim, who the person is they need to speak with and print out verification letters," Zielinski said. "These are the types of changes we are making to try to put more control at an earlier point of time in hands of retirees, to really improve the processes and free up capacity for us to complete these claims more timely."
In past, OPM had online services, but annuitants could make changes only after the government finalized their claim.
Finally, OPM is depending on and trusting the calculations of the retiree's home agency more and more to get money out the door more quickly.
"We are looking at what agencies are providing us as the benefit estimate and looking at how accurate they are," he said. "If the agency is accurate with estimates and we don't have to go through our normal calculation or formula that we would do before we fully process the claim to get the annuitant some money, then let's use that information to effectuate the payments and we can spend time on the exceptions."
Under the previous approach, Zielinski said retirees received about 90 percent of their final pay. Under this new approach, OPM can process the initial claims more quickly.
"Our responsibility is to give retirees clear and simple answers," he said. "Our goal is to put as much control in the hands of the retirees as possible."
(Copyright 2011 by FederalNewsRadio.com. All Rights Reserved.)