OPM Failing to Catch Widespread Fraud in Federal Health Program, GAO Finds

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Federal employees and their families may be exposed to higher costs and weaker protections as fraud vulnerabilities persist in the Federal Employees Health Benefits (FEHB) program. According to a newly released report from the U.S. Government Accountability Office (GAO), the Office of Personnel Management (OPM) has not done enough to identify or mitigate key fraud risks, despite previous warnings.

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The FEHB program, which serves over 8 million individuals and cost approximately $70 billion in fiscal year 2024, remains exposed to unaddressed fraud risks. While OPM has completed some fraud risk assessments, the agency has failed to fully catalog or document all inherent risks, including improper billing by health providers and unauthorized family member enrollments. GAO also found that OPM does not engage key stakeholders—such as health carriers or its own Office of Inspector General—directly in the fraud identification process, relying instead on secondhand reports.

The agency’s Risk Management Council was assigned to lead fraud prevention, but OPM now says its role is uncertain due to internal restructuring. GAO warned that this leadership gap, combined with incomplete risk assessments and limited stakeholder involvement, leaves taxpayer dollars vulnerable to misuse. The lack of documentation and transparent risk profiling could allow fraud to persist undetected, driving up program costs for enrollees.

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GAO issued six recommendations aimed at improving oversight and safeguarding public funds. These include clarifying which OPM office is responsible for fraud risk management, maintaining detailed documentation, expanding the fraud risk profile to include overlooked threats, and actively involving relevant stakeholders. OPM agreed with all recommendations and committed to implementing corrective actions, though no timeline was given.

Federal employees or dependents covered under the FEHB program should stay informed about any resulting changes, as better fraud controls may affect plan administration, eligibility verification, and provider oversight.

Article by multiple contributors, based upon information from a GAO press release.

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