FEHBP premium costs to increase next year, just not as much as this year

The Washington Post reports that the price federal employees pay for health insurance next year won't go up as much as it did this year, but that the 7.2 percent increase for 2011 is "much greater than inflation or any pay increase or cost of living adjustment they might get."

"The other news is that employee organizations say premiums in the Federal Employee Health Benefits Program could be lower if the Office of Personnel Management would stop refusing a subsidy." If OPM didn't decline a Congress-approved payment made available to other public and private employers to help them provide drug coverage as generous as Medicare's they could have saved $1 billion and lowered premiums, said the president of the National Active and Retired Federal Employees Association Friday. But it could have backfired. "Given the current climate in which Republicans are pushing for caps on federal employment and pay, drawing attention to a strong compensation package by saying it should be further subsidized could backfire. ... The Bush and Obama administrations have rejected past calls for OPM to accept the money'" (Davidson, 10/5).

Roll Call: "Premiums for enrollees of the Federal Employees Health Benefits Program will rise by an average of 7.2 percent — less than last year's increase of 8.8 percent and less than private-sector employer-sponsored health insurance plans, which are projected to increase from 8.9 percent to 10.5 percent. That means for each pay period, staffers will pay on average $5.53 more with self-only coverage and $11.45 with family coverage" (Newhauser, 10/5).

The Washington Post, in a second story: The Obama administration's OPM head [John] Berry said Monday that "The rates are actually much lower than our counterparts in the private sector," he said. "You also have to factor in that we're providing three [new] benefits this year, so we're increasing the benefits while our rate increase is lower than it is in the private sector." For the first time, FEHBP will cover children of enrollees up to age 26 as well as a host of preventive services and tobacco cessation classes. "FEHBP is the nation's largest employer-sponsored health insurance program, covering about 8 million people, including 2.2 million active federal workers, 1.9 million federal retirees, their spouses and dependents" (O'Keefe, 10/4).

The Washington Post, in its Consumer Reports insights column, reports on how to pick an insurance plan, and not just for FEHBP beneficiaries. "Consumer Reports published rankings produced by the nonprofit National Committee for Quality Assurance, the main U.S. group that sets standards for health insurance, accredits plans, measures the quality of care they achieve and publicly reports its findings. The top three plans, each of which scored about 90 points on a 100-point scale, operate in New England. The best performer in the Washington area was Cigna HealthCare Mid-Atlantic, which earned 86 points, good enough for 39th place among the 227 plans evaluated" (10/4).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.