The Office of Personnel Management has reduced the retirement claims backlog by almost 10,000 over the last 10 months and is processing claims on average in 37 days.
And in light of that progress, OPM will try for a fifth time to modernize the technology behind the retirement systems.
Ken Zawodny, OPM’s associate director for retirement services, and Donna Seymour, OPM’s chief information officer, told members of the House Oversight and Government Reform Subcommittee on the Federal Workforce, the U.S. Postal Service, and the Census, that the agency will procure a case management system to act as the foundation for a fully automated system in fiscal 2015.
“The case management system will give us greater insight into the cases themselves, our processes and our performance within those workflows,” Zawodny and Seymour said in their prepared testimony. “This solution will provide various levels of integration with other systems used to capture relevant data through the employment, investigation and retirement lifecycles.”
OPM held an industry day in 2014 when 17 vendors demonstrated their case management systems.
Zawodny and Seymour said OPM will use that demonstration and other market research to release a solicitation in 2015.
“Our effort will include an online retirement application that will help agencies ensure they submit completed retirement applications and make information more accessible to personnel planning their retirement,” Zawodny said. “Currently, we will complete the pilot project with payroll service providers for accepting payroll data from shared service centers using a standardized data format. Throughout 2015 and 2016, we will automate further functions currently performed by the mainframe, such as annuity calculations and routines to send payment information to Treasury. Transitioning from the mainframe to a distributed computing environment will save money and increase our ability to make changes to the system in a timely and efficient manner.”
Borrowing from the trust fund
Valerie Melvin, the Government Accountability Office’s director of information management and technology resource issues, told the subcommittee OPM plans to begin implementing the case management system by August 2015. Melvin wrote OPM received $2.6 million for the software in 2014.
OPM requested $2.4 million in 2015. But Chairman Blake Farenthold (R-Texas) said OPM only has spent $800,000 so far and he hopes that’s because of smart management and not because OPM is unclear where it’s heading with its IT modernization plan.
Richard Thissen, the national president of the National Active and Retired Federal Employee Association (NARFE), said OPM received the money from the Civil Service Retirement and Disability Trust Fund, which is made up of money that employees contributed to fund in return for retirement stability.
Thissen said he would like to see OPM provide additional details on how that money was spent.
Zawodny said part of the RFP process for the case management system will give OPM an idea of how much this new technology will cost over the long term.
Additionally, Melvin said in her prepared testimony that OPM plans to expand and test a retirement data repository to include data from agency human resources and payroll systems, data submitted via the online retirement application and scanned documents. OPM also plans to build a retirement calculator capability that pulls data from the data repository.
GAO said OPM plans to expand an online retirement data viewer to more agencies and develop requirements for an online electronic retirement application.
“We are moving from a mainframe environment. Most of these applications, and when we talk about 80 applications, they are small applications that do a very finite set of functions, and together form the Retirement services system,” Seymour said. “So what we are doing is taking this very incremental approach, putting in place the case management system first and then we are looking at each of the applications to make sure we understand the complete functionality that they perform and how we can move them into the modern environment.”
The number of systems and processes OPM must deal with to handle a retirement claim also concerns lawmakers.
Rep. Stephen Lynch (D-Mass.), ranking member of the subcommittee, said the root of OPM’s past failures are the 500 different laws and regulations, 80 different IT systems that must interface with 400 different data points.
GAO’s Melvin said OPM faces a complex set of processes and systems.
“It doesn’t make it impossible to address. What we are looking for from the standpoint of what OPM does is having clearly defined plans and a very detailed tactical approach to addressing these kinds of complexities,” she said. “There are priorities in terms of the requirement that have to be defined and how they will work through acquiring the particular systems and how they would interface. So a number of factors go into addressing it. Complex, yes, but not impossible.”
People, processes making a difference
Melvin said OPM needs to apply IT acquisition success factors such as stakeholder engagement and program management in order to avoid the mistakes of the past.
OPM has struggled since 1987 to modernize its retirement systems, with the latest collapse coming in 2011 when it terminated the Retirement Systems Modernization program.
In January 2012, the agency released a plan to address the claims backlog and the technology behind the system.
OPM increased the number of people reviewing and processing claims, and improved the business processes behind the effort. Both of those changes helped OPM address the backlog and speed up the claims processing.
But the technology remains a problem.
Director Katherine Archuleta received an IT improvement plan in her first 100 days in office, detailing in part how the technology behind the retirement system would be modernized.
This new approach is part of the work as outlined in the IT improvement plan.
“OPM has made significant progress in reducing the retirement claims inventory and modernizing the retirement process,” Zawodny and Seymour wrote in their testimony. “We expect to continue this progress utilizing process improvements and realizing incremental IT capabilities; however, we understand that challenges remain.”
Beyond technology, OPM has made progress in reducing the retirement claims backlog and processing time.
Zawodny said OPM is targeting three areas to find more efficiencies.
“The process team is focused on identifying opportunities to gain efficiency in the processes pertaining to the post adjudicative workload,” he said. “Process improvements will lead to more timely actions and a reduction in the potential for improper payments. We have mapped and evaluated the current processes and will review the data collected in order to identify improvement opportunities.”
Zawodny said the agency’s customer service team is studying current processes and customer behavior, and it made multiple visits to retirement systems facilities.
“Based on that research, we are focusing our attention on OPM’s online services,” he said. “Interview results show that customers who utilize RS online services are very satisfied with the services. The key is to drive more people to online services and to further improve those services and experiences.”
Zawodny added OPM also is reviewing and improving its call center support. OPM says during the fourth quarter of 2014, the average speed to answer calls improved by 30 percent, while its call handling volume increased to 41 percent and OPM reduced the amount of busy signals that employees and retirees get by 91 percent.
Error rate remains too high
NARFE’s Thissen said while OPM’s progress is real, there still are some non-IT areas they need to focus on.
“While OPM bears responsibility for processing the claims, a federal employee’s transition into retirement starts with the employing agency,” he said.
“Unfortunately, the governmentwide error rate for retirement submissions remain unacceptable. Although publishing the results has led to pressure on agencies to improve, there was no significant improvement from 2012 to 2014. Agencies should be performing better. Reducing the error rate would improve processing at OPM, especially as it bears the brunt of retirees’ frustrations with delayed claims.”
Thissen said the error rate governmentwide was 11 percent.
He also said the process to transition into retirement varies widely across government. If OPM could standardize this process through automation, it would go a long way toward eliminating the claims backlog.
Thissen said NARFE surveyed recent retirees, and 75 percent reported having a positive experience with OPM. While those who have been waiting for six months or more, are more frustrated than ever. Thissen said there are still 200 people that have waited at least six months to get their claims processed.