Various amendments on Hill could affect Federal Employee Health Benefits Program

There are a number of issues regarding the Federal Employee Health Benefits Program that have concerned many participants.

As Federal News Radio reported yesterday, FEHBP premiums are rising an average of 8.8 percent in 2010.

In addition, we've told you about that amendment from Senator Chuck Grassley (R-Iowa) that would essentially eliminate FEHBP.

On today's Your Turn with Mike Causey, Mike talked with Dan Adcock, Legislative Director for NARFE, about both of these issues.

Adcock said he wasn't surprised at all about reports of a premium increase.

"Given what we've seen with healthcare utilization and the trends that are going on right now, it's not a surprising increase. It just comes at a very difficult time -- we look at an average increase of 8.8 percent, but if you look at the largest plan in the program -- Blue Cross Blue Shield standard option -- their increase for family coverage is 12.4 percent, and for self-only it's 15 percent.

So, you couple that with the fact that federal annuitants are not only not going to get their federal civil service annuity COLA . . . and if they're eligible for Social Security, they're also not going to get a COLA from [that], and then, of course, we're still trying to figure out what kind of pay raise [federal employees] are going to get."

He added that he thinks 2010 might turn out to be difficult for both retirees and federal workers should all of these cuts come at once, in addition to paying more for health insurance.

Open season is coming, however. Adcock said it might be a good time to reevaluate your coverage and who your insurance company is.

[Your Turn plans on inviting Adcock back during Open Season for a more comprehensive discussion on that, so stay tuned!]

As for Sen. Grassley's amendment, Adcock said he thinks that it is being seriously considered, which could lead to some big changes for federal employees if it passes.

"This amendment was offered last week and it actually was accepted, but in a much watered down fashion. It would make enrollment by federal workers and members of Congress optional in the exchange system.

When the President or members of Congress who are supporting health care reform talk about providing something that is the equivalent of FEHBP, first, they're talking about the exchange system, because what they envisioned is on a state-by-state basis, private insurance companies would offer their products through this exchange. Of course they'd be regulated more than they are right now in the individual market, you wouldn't be able to have pre-existing conditions, you wouldn't be able to rate as much based on a person's age, but the idea being that you'd have a lot of different choices, just like you would in [FEHBP].

What Sen. Grassley's doing is basically saying, 'What's good for the goose, is good for the gander.' The amendment is trying to deliver a political message, but it does have the affect that, if it were made mandatory -- as originally written, the amendment required federal employees and members of Congress to be part of this exchange system, which would effectively end [FEHBP] -- and we understand that Sen. Grassley is still very interested in offering the original amendment . . . So that's why we've engaged all our grassroots members from around the country to write to their Senators in opposition of the Grassley amendment."

Adcock said he doesn't think the amendment is just for show for a variety of reasons. Sen. Grassley is close with the Chairman of the Senate Finance Committee, Senator Max Baucus (D-Mont).

In addition, similar amendments have been passed by the Senate Adult Health, Education, Labor and Pensions Committee.

Among the various other proposals floating around, Senator Ron Wyden (D-Ore.) has written an amendment that would open FEHBP to the public.

"It takes it in a different direction. Grassley's amendment is assuming that there is no more FEHBP and Sen. Wyden's is assuming there is. What he's proposing is that there's going to be a group of individuals who are going to be exempt from the individual mandate in the Senate Finance Committee bill. What the individual mandate means is that all Americans would have to go out and buy health insurance.

Something similar has been done in the state of Massachusetts, and the idea is that individuals that don't [have] health insurance are ending up in emergency rooms and costing us a lot more money, and if they tend to be younger individuals, then they're not helping to subsidize individuals who are older or may use health care more.

The group that will be exempted from this mandate appears to be growing because there's a concern about whether or not its going to be affordable for them to purchase health care. If you don't participate in the individual mandate, then you have to pay a pretty steep penalty . . . [so] because of this concern, there's going to be a growing number of individuals who are going to fall into this category that Sen. Wyden is suggesting should have access to [FEHBP].

While we, as an organization, believe all Americans should have access to comprehensive health care, we're concerned about any proposal that would allow non-federal civilians into our program without rating their premiums separately. If you don't do that, it could result in premium increases for the entire program and drastically change what we know today a program that, despite the premium increases, is relatively affordable and predictable in terms of its costs.

You can learn much more by listening to the entire show, found at the top of the page.

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