LIMITATIONS ON INPATIENT HOSPITALIZATION FOR THE AGENCY'S HEALTH PLAN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87M00539R002504160013-7
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 3
• Document Creation Date: December 22, 2016
• Document Release Date: August 24, 2009
• Sequence Number: 13
• Publication Date: October 15, 1985
• Content Type: MEMO

Approved For Release 2009/08/24: CIA-RDP87M00539R002504160013-7
CONFIDENTIAL
1.5 cc1
FROM: Harry E. Fitzwater
Deputy Director for Administration
SUBJECT: Limitations on Inpatient Hospitalization
For the Agency's Health Plan
REFERENCE: Note to DDA frm ExDir, dtd 3 Oct 85,
Same Subject (DD/A 85-3422)
1. This is written in response to your note of 3 October 1985
concerning your discussion with Stan Sporkin on health insurance
coverage. I asked the Office of Personnel (OP) to look into the
questions you raised and they have provided me with the following
information:
"The Agency Association Benefit Plan (ABP) provides 365 days of
continuous inpatient hospital coverage for each illness or
injury, as do most Federal Employee Health Benefits Program
plans. Claims. are paid based on the reasonable and customary
rates which have been established by the health insurance
industry for the specific geographic area and the medical
necessity of the hospitalization. For unusually long hospital
stays, ABP periodically requests doctor and hospital reports to
support the medical necessity for the continued confinement. If
the reports support continued hospitalization, approval for
confinement beyond the 365 days may be approved by the OP/
Insurance Operations Division. If these reports do not support
the medical necessity for the confinement, ABP will advise the
policyholder that benefits will be discontinued on a specific
future date."
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Approved For Release 2009/08/24: CIA-RDP87M00539R002504160013-7
l:uNrluJ NTIaI,
SUBJECT: Limitations on Inpatient Hospitalization
For the Agency's Health Plan
2. The Director of Personnel adds that cost control has been a
pressing necessity in all insurance plans not only our own.
Requirement for a second opinion, specified number of days of
hospitalization for a given illness, etc. are examples of measures
introduced universally to control costs. These controls, plus the
sharply reduced inflation rate, produced the surplus Stan is talking
about. The Director of Personnel believes it would be quite unwise
to reverse our field and liberalize benefits because of the
temporary surplus situation. The medical industry can best be
controlled if insurance plans place limits on reasonable costs. Our
plan like others is trying to do that. The education of plan
participants that is now going on subliminally (but apparently
liminally in Stan's case) is a very beneficial thing and should be
continued.
3. FYI, there have been new Medicare provisions put into effect
which strictly adhere to length of stay guidelines and require all
confinements be approved by a peer review organization. Possibly
this is what Stan had in mind. ABP has no such requirement.
~? L(u'4L 6I
Addressee
Executive Registry
DDA
D/Pers
DD/Pers/EBS
C/IOD/EBS/OP
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 Approved For Release 2009/08/24: CIA-RDP87M00539R002504160013-7
CONFIDENTIAL IDD A Registry
Central Intelligence Agency
Washington, D.C. 20505
3 October 1985
doing to deal with it
what kinds of things we might think about
Stan Sporkin has made the point to me
that as OPM pressures the health insurance
carriers to help control insurance costs, the
de facto benefits to our employees are
declining. I believe his point is that while
the specific terms of the policies that we
examine may not be changing all that much,
that often the definition of how much an
insurance company will actually spend to
compensate an individual for a specific
problem is being reduced, sometimes by
arbitrary judgments that X number of days
will be required to recover from an operation
in a hospital when in fact X plus days are
needed. I'd like to know if there is real
substance to this concern and if there is,
Approved For Release 2009/08/24: CIA-RDP87M00539R002504160013-7