Federal Employees Health Benefits Program: Additional Actions Needed to Address Significant Risks in Verifying Provider Eligibility

Why It Matters

Ineligible providers raise program costs and expose federal employees to safety risks, so tighter controls protect taxpayer dollars and patient health.

Key Takeaways

• GAO found 400 deceased‑provider claims in FEHB.
• Over 2,000 claims involved providers excluded from federal programs.
• Selected carriers often omit required patient notifications.
• Carrier reporting to OPM OIG on debarred providers is inconsistent.
• Matching death data could prevent future improper payments.

Pulse Analysis

The Federal Employees Health Benefits (FEHB) program, covering more than 8 million federal workers, is the nation’s largest employer‑sponsored health plan. Because OPM shoulders the responsibility for fraud prevention, any lapse in vetting providers can translate into billions of dollars in unnecessary expenditures. GAO’s recent audit highlights how outdated or incomplete eligibility checks allow claims from providers who are either deceased or barred from other federal contracts, underscoring a systemic vulnerability that could erode the program’s fiscal integrity.

GAO’s data‑driven analysis revealed approximately 400 claims linked to providers who had died and over 2,000 claims tied to individuals excluded from other federal initiatives. While these figures represent a modest slice of total FEHB claims, they signal a broader compliance gap. Moreover, several FEHB carriers were found to neglect mandatory notifications to beneficiaries when a provider is suspended or debarred, and they often fail to alert OPM’s Office of the Inspector General as required. This lack of transparency not only jeopardizes patient safety but also hampers OPM’s ability to intervene swiftly against fraudulent billing.

To mitigate these risks, experts recommend that OPM integrate real‑time death‑registry feeds and cross‑reference them against claim submissions, a practice already common in private insurers. Clarifying and enforcing carrier reporting obligations would further tighten the safety net, ensuring that suspended or debarred providers are promptly removed from the network. By adopting these measures, OPM can safeguard federal health benefits, reduce improper payments, and set a benchmark for government‑wide provider eligibility standards.