Report reveals differing federal employee insurance withholding information between USDA, OPM 

A report from the Agriculture Department’s inspector general found differences between its National Finance Center and the Office of Personnel Management in how each recorded life insurance withholding and coverage for some federal employees, leading to errors.

The agreed-upon procedures audit between the two agencies, which was published Sept. 29, looked at employee withholding and headcount reports for the prior year ending on Aug. 31, finding that several employees were charged incorrect amounts for life insurance, while also overreporting premium payers at one agency by 11%. 

The NFC calculates and tracks employee withholdings and employer contributions for federal health, life insurance and retirement benefits at nine departments, covering more than 640,000 people. 

It transmits withholding funds to OPM’s Retirement and Insurance Transfer System and offers reports of withholding and contribution records for each pay period. 

But in comparing transactions and payroll information to RITS submissions across six procedures, the audit found differences “through calculations, analysis and comparisons” that illuminated errors in withholding charges and one employee who was enrolled in basic life insurance, but shown as waived insurance in the system, despite no documentation of a waiver. 

“While OIG made agencies aware of the differences identified in [agreed-upon procedures] 2 and 4, agencies’ management either did not respond or provided comments that did not explain the differences noted in this report,” the OIG said. 

The audit also found 15 differences in one procedure category that ultimately overreported the number of health benefit premium payers at one agency. NFC officials agreed with the findings of the 15 differences and planned on program modifications on six of them, while researching what led to the differences in the remaining nine. 

The OIG said that the audit was not structured to offer an insight into the operation of withholdings and contributions information, but to note the differences in that information between NFC and the RITS system. 

“We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively, on the withholdings and contributions for health benefits, life insurance and retirements, and the headcount reports prepared by OCFO/NFC,” said Janet Sorenson, the USDA OIG assistant inspector general for audit, in a letter to the OPM OIG. “Therefore, we do not express such an opinion or conclusion. If we had performed additional procedures, other matters might have come to our attention that would have been reported to you.”

The AUP audit is part of an annual assessment of OPM’s retirement, health benefits, and life insurance withholdings/contributions “as well as semiannual headcount information submitted by agencies.”