Lawmakers join the long-term-care rate hike fray

A little more than a month after the Office of Personnel Management dropped its long-term-care bombshell, the House Oversight and Government Reform Committee is asking where exactly that bomb came from.

Committee Chairman Jason Chaffetz (R-Utah) sent a letter to Craig Bromley, president of John Hancock Financial Services, asking for information on the Federal Long Term Care Insurance Program. John Hancock Financial Services was the only company to bid on the FLTCIP contract in 2016.

The letter specifically asked for all documents pertaining to the FLTCIP, including an unredacted copy of the contract with OPM, unredacted copies of the 2001 and 2009 contracts, and documents related to any analysis that may have spurred the raising of premiums.

The letter specified a Sept. 2 deadline for the requested information, which gives them four weeks to investigate before the enrollee decision period — the time during which enrollees can choose to change their coverage — expires on Sept. 30.

Republicans gearing up for major changes to federal pay and benefits

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FedSmith first reported this story early on Aug. 24.

When OPM announced in July that almost everyone enrolled in the program could expect an average increase of 83 percent, the response from both current and retired feds vacillated between outrage and confusion. Many still want to know exactly why the increase will be so steep.

So does Congress.

Ranking Member Elijah Cummings (D-Md.) and Reps. Mark Meadows (R-N.C.) and Gerald Connolly (D-Va.) co-signed the letter. In July, Connolly and Don Beyer (D-Va.) sent a similar letter to acting OPM Director Beth Cobert.

“The cost of the insurance is expected to increase by an average of 83 percent, or $111 a month with some enrollees experiencing increases of up to 126 percent starting Nov. 1,” the July letter said. “For those on a fixed or limited income, such an increase is simply unaffordable.”

The July letter asked the following questions of OPM:

Congress asks: Are federal employees overpaid?

  • What accounts for the significant increase in premiums and how is that being calculated?
  • What outreach or support is being offered to enrollees beyond mailing letters?
  • In what ways are you working with enrollees to make these price spikes more affordable?
  • Are annual benchmarks incorporated to ensure that the actuarial projected value matches the actual value? If not, why?

Sens. Ben Cardin (D-Md.) and Barbara Mikulski (D-Md.) have added their voices to the mix as well. They sent an Aug. 19 letter to OPM relaying the anger they heard from federal workers.

“This is unacceptable, and so are the alternatives: a reduction in coverage to keep premiums at their current level, taking a ‘contingent benefit upon lapse’ for those who are eligible, or dropping coverage altogether,” the letter said.

The letter asked for at least a 60-day extension to the decision period, why this rate hike is happening, and what OPM is doing to keep this from happening again.

Sen. Mark Warner (D-Va.) and Rep. Barbara Comstock (R-Va.) have taken similar action as well.