OPM Has Work to Do to Improve its Retirement Application Processing

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By on June 16, 2019 in Agency News with 0 Comments
3D red checkmark in a box in the center of a circle labeled 'corrective action' depicting a need for process improvements

A recent report from the Government Accountability Office highlights the problems the Office of Personnel Management is facing with its retirement application processing methodology and also makes recommendations for how OPM could improve the overall process.

The Problem

OPM receives over 100,000 retirement applications each year from federal employees who are leaving their government careers, however, the agency is not even meeting its own stated goals for processing the applications in a timely manner. Between 2014 to 2017, OPM did not meet its goal of processing most retirement applications within 60 days. This has led to a consistent backlog of applications at the agency which in years past has topped 60,000 at some of its worst points. At its most recent count, it stood at 17,228.

OPM blames the problem on three things:

  1. the continuing reliance on paper-based applications and manual processing;
  2. insufficient staffing capacity, particularly during peak workload season; and
  3. incomplete applications.

Failed Past Efforts to Modernize Retirement Processing

GAO noted in its recent report that OPM has previously tried and failed over several decades to modernize its retirement processing methods.

“…we found that OPM’s efforts over 2 decades to modernize its processing of federal employee retirement applications were fraught with (information technology) IT management weaknesses,” wrote GAO.

One of these boondoggles was undertaken in 2008. It was known as the RetireEZ project. OPM said at the time, “This means you will receive your full annuity at the first payment, rather than after a period of reduced interim payments—eliminating a practice that has disadvantaged new retirees and been a barrier to our ability to achieve the highest level of customer service. This modernization moves Federal agencies from a labor-intensive, paper-based process to a modern, electronic system that contains all the Federal and military service records needed to compute the annuities of Federal employees.”

Only if that were true. After spending several million dollars on the project, OPM cancelled it. The solution? Hire more people and use a manual processing system, essentially reverting back to what it had been doing all along.

GAO is well aware of these past failed attempts and the continual reliance on a paper based retirement application system. The report stated, “Subsequent to terminating its retirement modernization effort in February 2011, OPM refocused its retirement modernization efforts and in 2013 developed a new strategic vision for modernizing retirement applications processing. OPM’s 2013 strategic vision for modernizing retirement applications processing envisioned a paperless system that would timely authorize accurate retirement benefit payments, answer customers’ questions, and promote self-service account maintenance.”

The 2013 strategic vision sounds an awful lot like the RetireEZ program announced in 2008, no?

GAO noted, however, that OPM hasn’t exactly established itself as a good steward of managing project costs in the past. The report states:

OPM’s current approach provides a framework to help the agency achieve its overall IT modernization strategic vision. However, OPM officials provided no further explanation about how retirement IT modernization activities would proceed, such as describing proposed time frames and estimated cost ranges, even for initial project phases. Likewise, OPM’s Inspector General recently reported that the agency’s fiscal year 2018 IT modernization expenditure plan did not account for total costs nor identify the full scope of OPM’s modernization effort for the agency.

FedSmith author Robert Benson has detailed the ongoing debacle of the retirement backlog situation at OPM and says that it is only going to get worse with the agency’s current manual approach to processing retirement applications since the number of retirees on the rolls is projected to increase in the next few years.

Benson says the root cause of the backlog lies in the complexity of calculating the FERS annuity supplement, something that could be handled much more easily with the right software.

He echoed GAO’s sentiment, stating, “…it is quite clear something needs to be done other than simply throwing bodies and hours at the problem; this has been tried and failed, abysmally.”

Other Challenges

GAO identified other problems OPM faces in dealing with its retirement backlog. It gets incomplete retirement applications submitted that have to be dealt with, and there is an annual surge of retirement applications in January and February that lasts until mid April thanks to the 60 days or so it takes to process an application.

GAO said that performance measurement information is also missing from the process.

“OPM does not use performance information on processing timeliness to manage for results. In addition, we found that OPM conducted limited assessments of its processing data and did not assess the effectiveness of its staffing actions,” wrote GAO. It’s apparently hard to know if goals are being met without this information.

GAO Recommendations

GAO made six recommendations in its report to address these problems that it identified. However, GAO said that OPM only partially concurred with 5 of the 6 recommendations. Apparently the two agencies are at odds on the solutions as the report stated, “GAO continues to believe all aspects of the recommendations are valid, as discussed in the report.”

A copy of the full report is included below.

GAO: OPM Actions Needed to Improve Application Processing Times

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Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce.

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