Errors in Health Benefits Enrollment Data Push Up Health Insurance Costs

Discrepancies in enrollment data between federal agencies' and health insurance carriers' records cause erroneous premium and benefits payments, cause inequities among carriers and employees, and unnecessarily increase health insurance costs for both the government and its employees. Accurate data are needed to determine the coverage provided individual employees, employees' payroll deductions, and the premium payment to carriers, and to insure prompt payment of claims. An audit was conducted that focused on the frequency and effect of discrepancies in enrollment data in two categories: (1) enrollees who were recorded on the records of either federal agencies or carriers but not both; and (2) enrollees who were recorded on the records of both federal agencies and carriers but for whom data differed in those two sets of data.

The discrepancies resulted mainly from the manual procedures prescribed by the Office of Personnel Management (OPM) for federal agencies and carriers to exchange enrollment data. Such procedures invite error and are too costly to be effected fully. The discrepancy rate varied, but it appeared to be over 10 percent, with carrier records containing most of the errors. GAO estimated in 1978 that these errors cost $2 million to $5 million annually. OPM could significantly diminish, if not eliminate, the errors in enrollment data by prescribing procedures for exchanging enrollment data in computer-readable form. This also would reduce agency and carrier costs for exchanging data.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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