oversight

Audit of the Federal Employees Health Benefits Program Operations at Aetna Open Access - Mid-Atlantic

Published by the Office of Personnel Management, Office of Inspector General on 2012-08-08.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                                     U.S. OFFICE OF PERSONNEL MANAGEMENT
                                                           OFFICE OF THE INSPECTOR GENERAL
                                                                            OFFICE OF AUDITS




                                   Final Audit Report
Subject:

         Audit of the Federal Employees Health Benefits
          Program Operations at Aetna Open Access -
                          Mid-Atlantic



                                           Report No. 1C-P3-00-12-043

                                          Date: August 8, 2012                               _____________




                                                      -- CAUTION --
This audit report has been distributed to Federal officials who are responsible for the administration of the audited program. This audit
report may contain proprietary data which is protected by Federal law (18 U.S.C. 1905). Therefore, while this audit report is available
under the Freedom of Information Act and made available to the public on the OIG webpage, caution needs to be exercised before
releasing the report to the general public as it may contain proprietary information that was redacted from the publicly distributed copy.
                                                     AUDIT REPORT



                                Federal Employees Health Benefits Program
                             Community-Rated Health Maintenance Organization
                                    Aetna Open Access – Mid-Atlantic
                                 Contract Number CS 2914 - Plan Code P3
                                          Blue Bell, Pennsylvania



              Report No. 1C-P3-00-12-043                                          Date: August 8, 2012                               _ ____ __




                                                                                      Michael R. Esser
                                                                                      Assistant Inspector General
                                                                                        for Audits

                                                      -- CAUTION --
This audit report has been distributed to Federal officials who are responsible for the administration of the audited program. This audit
report may contain proprietary data which is protected by Federal law (18 U.S.C. 1905). Therefore, while this audit report is available
under the Freedom of Information Act and made available to the public on the OIG webpage, caution needs to be exercised before
releasing the report to the general public as it may contain proprietary information that was redacted from the publicly distributed copy.
                               EXECUTIVE SUMMARY




                      Federal Employees Health Benefits Program
                   Community-Rated Health Maintenance Organization
                          Aetna Open Access – Mid-Atlantic
                       Contract Number CS 2914 - Plan Code P3
                                Blue Bell, Pennsylvania


         Report No. 1C-P3-00-12-043                    Date: August 8, 2012


The Office of the Inspector General performed an audit of the Federal Employees Health
Benefits Program (FEHBP) operations at Aetna Open Access – Mid-Atlantic (Plan). The audit
covered contract years 2009 through 2011. We found that the FEHBP rates were developed in
accordance with applicable laws, regulations, and the Office of Personnel Management’s rating
instructions for the years audited.




                                               i
                                                    CONTENTS

                                                                                                                   Page

      EXECUTIVE SUMMARY .............................................................................................. i

  I. INTRODUCTION AND BACKGROUND..................................................................... 1

II. OBJECTIVES, SCOPE, AND METHODOLOGY ......................................................... 3

III. RESULTS OF THE AUDIT ............................................................................................ 5

IV. MAJOR CONTRIBUTORS TO THIS REPORT ............................................................ 6
The Plan has participated in the FEHBP since 1982 and provides health benefits to FEHBP
members in the Southern New Jersey, Delaware and Philadelphia, Pennsylvania areas. The last
audit of the Plan conducted by our office was a full scope audit of contract years 2005 through
2008 and did not identify any deficiencies.

The preliminary results of this audit were discussed with Plan officials at an exit conference and
in subsequent correspondence. Since the audit concluded that the Plan’s rating of the FEHBP
was in accordance with applicable laws, regulations, and instructions, a draft report was not
issued.




                                                 2
the various information systems involved. However, nothing came to our attention during our
audit testing utilizing the computer-generated data to cause us to doubt its reliability. We believe
that the available data was sufficient to achieve our audit objectives. Except as noted above, the
audit was conducted in accordance with generally accepted government auditing standards,
issued by the Comptroller General of the United States.

The audit fieldwork was conducted at the Plan’s office in Blue Bell, Pennsylvania, during March
2012. Additional audit work was completed at our offices in Cranberry Township,
Pennsylvania.

Methodology

We examined the Plan’s federal rate submissions and related documents as a basis for validating
the market price rates. In addition, we examined the rate development documentation and
billings to other groups, such as the SSSGs, to determine if the market price was actually charged
to the FEHBP. Finally, we used the contract, the Federal Employees Health Benefits Acquisition
Regulations, and OPM’s Rate Instructions to Community-Rated Carriers to determine the
propriety of the FEHBP premiums and the reasonableness and acceptability of the Plan’s rating
system.

To gain an understanding of the internal controls in the Plan’s rating system, we reviewed the
Plan’s rating system policies and procedures, interviewed appropriate Plan officials, and
performed other auditing procedures necessary to meet our audit objectives.




                                                 4
                           III. RESULTS OF THE AUDIT
Our audit showed that the Plan’s rating of the FEHBP was in accordance with applicable laws,
regulations, and OPM’s rating instructions to carriers for contract years 2009 through 2011.
Consequently, the audit did not identify any questioned costs and no corrective action is
necessary.




                                              5
            IV. MAJOR CONTRIBUTORS TO THIS REPORT

Community-Rated Audits Group

                , Auditor-in-Charge

                   , Auditor



                  ., Chief

                , Senior Team Leader




                                       6