74054 Federal Register / Vol. 79, No. 240 / Monday, December 15, 2014 / Proposed Rules 

• Is certified as not having a 

significant economic impact on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.); 

• Does not contain any unfunded 

mandate or significantly or uniquely 

affect small governments, as described 

in the Unfunded Mandates Reform Act 

of 1995 (Public Law 104–4); 

• Does not have Federalism 

implications as specified in Executive 

Order 13132 (64 FR 43255, August 10, 

1999); 

• Is not an economically significant 

regulatory action based on health or 

safety risks subject to Executive Order 

13045 (62 FR 19885, April 23, 1997); 

• Is not a significant regulatory action 

subject to Executive Order 13211 (66 FR 

28355, May 22, 2001); 

• Is not subject to requirements of 

section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (15 U.S.C. 272 note) because 

application of those requirements would 

be inconsistent with the Clean Air Act; 

and 

• Does not provide EPA with the 

discretionary authority to address, as 

appropriate, disproportionate human 

health or environmental effects, using 

practicable and legally permissible 

methods, under Executive Order 12898 

(59 FR 7629, February 16, 1994). 

In addition, this rule does not have 

tribal implications as specified by 

Executive Order 13175 (65 FR 67249, 

November 9, 2000), because the SIP is 

not approved to apply in Indian country 

located in the state, and EPA notes that 

it will not impose substantial direct 

costs on tribal governments or preempt 

tribal law. 

List of Subjects in 40 CFR Part 52 

Environmental protection, Air 

pollution control, Incorporation by 

reference, Intergovernmental relations, 

Lead, Ozone, Particulate matter, 

Reporting and recordkeeping 

requirements. 

Authority: 42 U.S.C. 7401 et seq. 

Dated: December 2, 2014. 

Judith A. Enck, 

Regional Administrator, Region 2. 

[FR Doc. 2014–29332 Filed 12–12–14; 8:45 am] 

BILLING CODE 6560–50–P 

OFFICE OF PERSONNEL 

MANAGEMENT 

48 CFR Parts 1609, 1615, 1632, and 

1652 

RIN 3206–AN13 

Federal Employees Health Benefits 

Program: FEHB Plan Performance 

Assessment System 

AGENCY: Office of Personnel 

Management. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The United States Office of 

Personnel Management (OPM) is issuing 

a proposed rule to amend the system for 

assessing the annual performance of 

health plans contracted under the 

Federal Employees Health Benefits 

(FEHB) Program. The purpose of this 

rule is to measure and assess all FEHB 

plan performance (experience-rated and 

community-rated) through the use of a 

common, objective, and quantifiable 

performance assessment for the 2016 

plan year. 

DATES: OPM must receive comments on 

or before January 14, 2015. 

ADDRESSES: Send written comments to 

Wenqiong Fu, Policy Analyst, Planning 

and Policy Analysis, U.S. Office of 

Personnel Management, Room 4312, 

1900 E Street NW., Washington, DC; or 

FAX to (202) 606–6010 Attn: Wenqiong 

Fu. You may also submit comments 

using the Federal eRulemaking Portal: 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

FOR FURTHER INFORMATION CONTACT: 

Wenqiong Fu, Policy Analyst at (202) 

606–0004. 

SUPPLEMENTARY INFORMATION: 

FEHB Background 

The Federal Employees Health 

Benefits (FEHB) Program was 

established in 1960 and provides health 

insurance to over eight million Federal 

employees, annuitants, and their family 

members. Chapter 89 of Title 5 United 

States Code, which authorizes the FEHB 

Program, allows OPM to contract with 

health insurance carriers to provide 

coverage under certain types of plans. 

FEHB contracts are either communityrated or experience-rated. In 

community-rated contracts, the overall 

premium is based on the carrier’s 

standard rating methodology, taking 

into account factors in the larger 

geographic area or ‘‘community.’’ In 

experience-rated contracts, the FEHB 

carrier considers actual ‘‘experience’’ or 

medical costs of the group of covered 

lives. The two types of contracts are 

regulated under different sections of the 

FEHB Acquisition Regulation 

(FEHBAR). Premiums are determined 

according to distinct processes and plan 

performance is rewarded differently. 

Current Performance Assessment 

System 

Under current regulations, 

performance is assessed for experiencerated plans based on profit analysis 

factors that are weighted to create a 

service charge that OPM pays to 

carriers. For community-rated plans, 

performance is assessed according to 

specific elements that can result in a 

percentage of premium withheld from 

payment to the carrier. Both of these 

performance frameworks are under the 

umbrella of the Federal Acquisition 

Regulation, which governs contracting 

government-wide. 

In determining the level of the service 

charge (profit/risk margin) for 

experience-rated plans, Contracting 

Officers consider six categories of 

factors: Contractor performance, 

contract cost, federal socioeconomic 

programs, cost control, independent 

development, and capital investments. 

OPM Contracting Officers conduct the 

service charge analysis and rely heavily 

on the contractor performance factor. 

Contractor performance is weighted the 

highest, comprises a significant portion 

of the total service charge, and involves 

the largest amount of data. 

Community-rated plans have two 

performance elements that may lead to 

a percentage of premium being 

withheld: Customer service and critical 

contract compliance requirements. 

Proposed FEHB Plan Assessment 

System 

To establish a consistent assessment 

system, create a more objective 

performance standard, and provide 

more transparency for enrollees, OPM is 

developing a framework that will utilize 

a discrete set of quantifiable measures 

examining key aspects of contract 

performance and specific criteria for 

performance factors which will then be 

linked to health plan premium 

disbursements. 

This regulation proposes to replace 

the current methods of plan assessment 

with a new framework, in which both 

experience-rated and community-rated 

plans utilize the same measurement 

criteria. For experience-rated plans, the 

performance-based service charge will 

be administered similarly to the current 

service charge process. For communityrated plans, the performance adjustment 

will be administered similarly to the 

current process using an adjustment to 

net-to-carrier premium payments made 

during the first quarter of the following 


tkelley on DSK3SPTVN1PROD with PROPOSALS
Federal Register / Vol. 79, No. 240 / Monday, December 15, 2014 / Proposed Rules 74055 

contract period. OPM proposes the new 

assessment system will impact service 

charge and performance adjustment 

premium disbursements made in 2017. 

This proposed regulation includes 

four measurement categories for both 

experience-rated and community-rated 

plans aimed at improving standards of 

accountability and transparency. The 

following categories, defined in 48 CFR 

1615.404–70, will be applied to both 

experience-rated and community-rated 

plans: (1) Clinical Quality, (2) Customer 

Service, (3) Resource Use, and (4) 

Contract Oversight. 

The new performance assessment 

structure is incorporated in 48 CFR, 

Subpart 1615.4, Contract pricing, which 

describes the profit factors and rewards 

for FEHB plans. Contract requirements 

will be amended to indicate required 

performance measures, and the scoring 

of measures within the assessment 

system will be based on plan 

performance relative to FEHB or 

national benchmarks, or with respect to 

the Contract Oversight category, the 

Contracting Officer’s judgment. Each 

year, identified measures will be 

communicated to FEHB carriers through 

advance guidance and then 

incorporated as a part of the contract. 

Three of the performance areas, 

Clinical Quality, Customer Service, and 

Resource Use, will contain one or more 

domains that reflect priorities within 

each area, and each domain will be 

comprised of one or more performance 

areas. The fourth category, Contract 

Oversight, will be based upon the 

Contracting Officer’s evaluation of 

contractor performance such as audit 

findings, fraud/waste/abuse, 

responsiveness to OPM, benefits/

network management, contract 

compliance, technology management, 

data security, and Federal socioeconomic programs. 

OPM expects to update the measures 

over time, and therefore the regulation 

lists representative examples of the 

domains and measures within each 

category. OPM will issue and 

periodically update technical guidance 

describing the measures and methods/

formulae for performance scoring. FEHB 

carriers will receive technical guidance 

updating measures, methods and 

scoring in advance of their use in the 

plan assessment process. 

Plan performance on Clinical Quality, 

Customer Service, and Resource Use 

will be evaluated against national or 

FEHB benchmarks. OPM’s goal is to 

build on current performance 

assessment practices so that we can 

formally link annual evaluations of 

FEHB plans with profit factors. The 

proposed measures will rely upon the 

evaluation of data from sources familiar 

to FEHB carriers such as: 

HEDIS—Healthcare Effectiveness Data 

and Information Set is a group of 

clinical measures developed by the 

National Committee for Quality 

Assurance (NCQA). HEDIS measures are 

widely used in U.S. health plan 

performance systems and have been 

collected by FEHB for more than ten 

years. 

CAHPS—Consumer Assessment of 

Healthcare Providers and Systems is a 

survey of health plan enrollees 

developed by the Agency for Healthcare 

Research and Quality (AHRQ). FEHB 

plans have participated in CAHPS and 

reported results to OPM since 2000. 

Plan administrative data—OPM 

collects data from health plans for 

contract oversight purposes. These may 

include data on financial management; 

claims payment timeliness; claims 

records and utilization data; enrollment 

reconciliation; surveillance for fraud, 

waste, and abuse; health information 

technology implementation; data 

security; and network adequacy. 

This regulatory change is intended to 

promote a comprehensive approach to 

health plan management by measuring 

key performance components. 

Measurement 

The new performance assessment 

system will begin in 2016. OPM will 

announce the applicable categories, 

domains, measures and weights in 

FEHB Carrier guidance at a later time, 

well in advance of implementation so 

that FEHB carriers have the opportunity 

to provide feedback through established 

OPM channels. Prior to each contract 

year, OPM will identify the most recent 

available benchmarks for each measure 

which will be used in applying the new 

weighted guidelines to determine that 

year’s service charge or performance 

adjustment for FEHB contracts. 

Following rate negotiations, for both 

experience-rated plans and communityrated plans, OPM Contracting Officers 

will inform FEHB plans of the 

performance scoring results used in 

determining each plan’s service charge 

or performance adjustment. 

Assessing Progress 

Specific domains, measures and 

weights will be provided in future 

technical guidance. While there will be 

continuity over time in many of the 

domains and measures, the plan 

assessment system must be dynamic to 

account for: (1) Changes in clinical 

guidelines and professional standards of 

care, (2) removal of measures where 

overall plan performance is at a 

consistently high level, and (3) the 

introduction of new measures that are 

deemed relevant to plan performance. 

Regulatory Flexibility Act 

I certify that this regulation will not 

have a significant economic impact on 

a substantial number of small entities 

because the regulation affects only 

health insurance carriers under the 

Federal Employees Health Benefits 

Program. 

Executive Orders 13563 and 12866, 

Regulatory Review 

This rule has been reviewed by the 

Office of Management and Budget in 

accordance with Executive Orders 

13563 and 12866. 

Federalism 

We have examined this rule in 

accordance with Executive Order 13132, 

Federalism, and have determined that 

this rule will not have any negative 

impact on the rights, roles and 

responsibilities of State, local, or tribal 

governments. 

List of Subjects in 48 CFR Parts 1615 

and 1609 

Government employees, Government 

procurement, Health insurance. 

U.S. Office of Personnel Management. 

Katherine Archuleta, 

Director. 

For the reasons set forth in the 

preamble, OPM amends chapter 16 of 

title 48 CFR (FEHBAR) as follows: 

PART 1609—CONTRACTOR 

QUALIFICATIONS 

■ 1. The authority citation for part 1609 

continues to read as follows: 

Authority: 5 U.S.C. 8913; 40 U.S.C. 486(c); 

48 CFR 1.301. 

Subpart 1609.71—[Removed] 

■ 2. Remove subpart 1609.71. 

PART 1615—CONTRACTING BY 

NEGOTIATION 

■ 3. The authority citation for part 1615 

continues to read as follows: 

Authority: 5 U.S.C. 8913; 40 U.S.C. 486(c); 

48 CFR 1.301. 

■ 4. In section 1615.404–4, paragraph 

(a) is revised to read as follows: 

1615.404–4 Profit. 

(a) When the pricing of FEHB Program 

contracts is determined by cost analysis 

(experience-rated) or by a combination 

of cost and price analysis (communityrated), OPM will determine a 

performance based percentage of the 

price using a weighted guidelines 


tkelley on DSK3SPTVN1PROD with PROPOSALS
74056 Federal Register / Vol. 79, No. 240 / Monday, December 15, 2014 / Proposed Rules 

structured approach based on the profit 

analysis factors described in 1615.404– 

70. For experience-rated plans, OPM 

will use the performance based 

percentage so determined to develop the 

profit or fee prenegotiation objective, 

which will be the total profit (service 

charge) negotiated for the contract. For 

community-rated plans, OPM will use 

the performance based percentage so 

determined to develop an adjustment to 

net-to-carrier premiums, (performance 

adjustment) to be made during the first 

quarter of the following contract period. 

* * * * * 

■ 5. Section 1615.404–70 is revised as 

follows: 

1615.404–70 Profit analysis factors. 

(a) OPM Contracting Officers will 

apply a weighted guidelines method in 

developing the performance based 

percentage for FEHB Program contracts. 

For experience-rated plans, the 

performance based percentage will be 

applied to projected incurred claims 

and allowable administrative expenses. 

For community-rated plans, the 

performance based percentage will be 

applied to subscription income and will 

be used to calculate a performance 

adjustment to net-to-carrier premiums, 

as described at 48 CFR 1632.170(a)(2), to 

be made during the first quarter of the 

following contract period. In the context 

of the factors outlined in FAR 15.404– 

4(d), OPM will assess performance of 

FEHB carriers according to four factors. 

(1) Clinical quality. OPM will 

consider elements within such domains 

as preventive care, chronic disease 

management, medication use, and 

behavioral health. This factor 

incorporates elements from the FAR 

factor ‘‘contractor effort.’’ 

(2) Customer service. OPM will 

consider elements within such domains 

as communication, access, claims, and 

member experience/engagement. This 

factor incorporates elements of the FAR 

factor ‘‘contractor effort.’’ 

(3) Resource use. OPM will consider 

elements within such domains as 

utilization management, administrative, 

and cost trends. This factor incorporates 

elements of the FAR factors ‘‘contractor 

effort,’’ ‘‘contract cost risk,’’ and ‘‘cost 

control and other past 

accomplishments.’’ 

(4) Contract oversight. OPM will 

consider an assessment of contract 

performance in specific areas such as 

audit findings, fraud/waste/abuse, and 

responsiveness to OPM, benefits/

network management, contract 

compliance, technology management, 

data security, and Federal socioeconomic programs. This factor could 

incorporate any of the FAR profit 

analysis factors listed at 15.404– 

4(d)(1)(i)–(vi). 

(b) The sum of the maximum scores 

for the profit analysis factors will be 1 

percent. 

PART 1632—CONTRACT FINANCING 

■ 6. The authority citation for part 1632 

continues to read as follows: 

Authority: 5 U.S.C. 8913; 40 U.S.C. 486(c); 

48 CFR 1.301. 

■ 7. In section 1632.170, paragraph 

(a)(2) is revised to read as follows: 

1632.170 Recurring premium payments to 

carriers. 

(a) * * * 

(2) The difference between one 

percent and the performance based 

percentage of the contract price 

described at 1615.404–4 will be 

multiplied by the carrier’s subscription 

income for the year of performance and 

the resulting amount (performance 

adjustment) will be withheld from the 

net-to-carrier premium disbursement 

during the first quarter of the following 

contract period unless an alternative 

payment arrangement is made with the 

carrier’s Contracting Officer. 

Amounts withheld from a community 

rated plan’s premium disbursement will 

be deposited into the plan’s 

Contingency Reserve. 

* * * * * 

PART 1652—CONTRACT CLAUSES 

■ 8. The authority citation for part 1652 

continues to read as follows: 

Authority: 5 U.S.C. 8913; 40 U.S.C. 486(c); 

48 CFR 1.301. 

■ 9. In section 1652.232–70, revise the 

introductory text and paragraph (a) and 

remove paragraph (f). 

The revisions read as follows: 

1652.232–70 Payments—Community-rated 

contracts. 

As prescribed in 1632.171, the 

following clause shall be inserted in all 

community-rated FEHBP contracts: 

Payments 

(a) OPM will pay to the Carrier, in full 

settlement of its obligations under this 

contract, subject to adjustment for error or 

fraud, the subscription charges received for 

the plan by the Employees Health Benefits 

Fund (hereinafter called the Fund) less the 

amounts set aside by OPM for the 

Contingency Reserve and for the 

administrative expenses of OPM, amounts for 

obligations due pursuant to paragraph (b) of 

this clause and the performance adjustment 

described at 1615.404–4, plus any payments 

made by OPM from the Contingency Reserve. 

* * * * * 

■ 10. In section 1652.232–71, revise the 

introductory text and paragraph (a) and 

remove paragraph (f). 

The revisions read as follows: 

1652.232–71 Payments—experience-rated 

contracts. 

As prescribed in 1632.172, the 

following clause shall be inserted in all 

experience-rated FEHBP contracts: 

(a) OPM will pay to the Carrier, in full 

settlement of its obligations under this 

contract, subject to adjustment for error or 

fraud, the subscription charges received for 

the plan by the Employees Health Benefits 

Fund (hereinafter called the Fund) less the 

amounts set aside by OPM for the 

Contingency Reserve and for the 

administrative expenses of OPM, amounts for 

obligations due pursuant to paragraph (b) of 

this clause, and the performance-based 

service charge described at 1615.404–4, plus 

any payments made by OPM from the 

Contingency Reserve. 

* * * * * 

[FR Doc. 2014–29224 Filed 12–12–14; 8:45 am] 

BILLING CODE 6325–63–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 648 

RIN 0648–BE50 

Magnuson-Stevens Fishery 

Conservation and Management Act 

Provisions; Fisheries of the 

Northeastern United States; Northeast 

Region Standardized Bycatch 

Reporting Methodology Omnibus 

Amendment 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Notice of availability of 

proposed fishery management plan 

amendment; request for comments. 

SUMMARY: NMFS announces that the 

Mid-Atlantic and New England Fishery 

Management Councils have submitted 

an Omnibus Amendment to the Fishery 

Management Plans of the Northeastern 

U.S. to establish a Standardized Bycatch 

Reporting Methodology, incorporating a 

draft Environmental Assessment and 

preliminary Regulatory Impact Review, 

for review and approval by the Secretary 

of Commerce, and is requesting 

comments from the public. The 

Standardized Bycatch Reporting 

Methodology Omnibus Amendment 

would establish a standardized bycatch 

reporting methodology for all 13 Fishery 

Management Plans in the region, as 


tkelley on DSK3SPTVN1PROD with PROPOSALS