REP. FARENTHOLD CHAIRS HEARING ON PROCESSING OF FEDERAL WORKER PENSION CLAIMS

May 9, 2013
WASHINGTON – U.S. Representative Blake Farenthold (TX-27), Chairman of the House Oversight Subcommittee on the Federal Workforce, U.S. Postal Service and the Census, today held a hearing looking at the time it takes the Office of Personnel Management (OPM) to process federal worker pension claims.

“2.5 million retired federal workers and their survivors rely on their pension check every month to make ends meet. What’s shocking to me is that OPM, who administers these checks, does it the same way today that they did it in 1987. This lack of modernization has resulted in a backlog of 30,000 claims, while the OPM averages $100 million each year in payments to deceased annuitants and survivors. OPM’s processing of these claims is clearly not efficient and effective and just reinforces the government’s poor IT record,” said Congressman Farenthold in his opening statement.

“While the President’s budget recommends $2.6 million to fund a case management system, the budget is short on detail and provides little guidance on how OPM will achieve a modern system. We’ve seen hundreds of millions of dollars wasted in failed information technology contracts, yet reform still seems vague,” continued Rep. Farenthold.

The Subcommittee heard testimony from Mr. Patrick McFarland, Inspector General at the U.S. Office of Personnel Management, Mr. Kenneth Zawodny, Associate Director of Retirement Services at the U.S. Office of Personnel Management, Ms. Valerie C. Melvin, Director, Information Management & Technology Resource Issues, U.S. Government Accountability Office, Mr. Joseph A. Beaudoin, President, National Active and Retired Federal Employees Association, and Dr. George Kettner, President, Economic Systems, Inc.

During the questioning portion of the hearing, Congressman Farenthold spoke to the benefits of using technology to modernize and streamline OPM’s processing of retired federal employee pension claims.

“Do you see some things that OPM could do immediately to kick the technology up, save some time and get the claims processed faster?” Rep. Farenthold asked government IT expert Valerie Melvin.

“The approach that they are taking now, which we see as a very modest, incremental step…is probably a prudent and risked-based approach for them to take, given their inability to be successful with such initiatives in the past,” replied Ms. Melvin.

Congressman Farenthold asked the same question to Dr. Kettner, whose company, Economic Systems Inc., specializes in data entry software.

“I think there are certainly steps that could be taken immediately, and I think you’re entirely correct in thinking that more could be done at the agency level. That’s where the data comes from and where much more can be done. There is no reason in the world the data should not be given to OPM electronically,” concluded Mr. Kettner.

OPM has less than 60 days to achieve its short-term goal of reducing the backlog and processing 90 percent of claims within 60 days. In response to a question from Representative Farenthold about meeting this short-term goal, Mr. Zawodny expressed some insecurity but told the committee he was hopeful it could be met.