OPM Has Unlawfully Let the Same Contractor Manage Feds’ Health Savings Accounts for 12 Years

Source: Eric Katz, Government Executive, October 26, 2015

The Office of Personnel Management has illegally allowed the same company to manage federal employees’ health savings account benefit for 12 years without holding open competitions for the contract, according to a new audit report. … ADP Benefits Services KY, Inc., formerly known as SHPS Human Resources Solutions, Inc., was initially awarded the contract to run the Federal Flexible Spending Account Program (FSAFEDS) in 2003. OPM has extended the contract on four occasions without opening up a bidding process. OPM awarded the extensions despite “substantial changes” to the program’s requirements, the IG said. … The IG has previously brought the issue to the attention of OPM, which said it would have a new contract in place by December 2014. OPM missed that and subsequent deadlines, causing the IG to tell agency management the issue has reached a “critical stage” and to stress that “future extensions should not be considered.” The most recent extension of the contract is scheduled to expire Dec. 23, 2015, though in response to the report, Cobert said OPM will not be able to award a new contract until “early 2016.”