Open season means feds can move to self-plus-one option

The Office of Personnel Management finalized the rule creating a new benefit option for the Federal Employee Health Benefit Program.

Federal employees can begin signing up for the self-plus one option in the Federal Employee Health Benefits Program when the annual open season starts Nov. 9.

The Office of Personnel Management finalized the ruleThursday creating this new benefit option for employees and retirees starting in 2016.

Congress passed and President Barack Obama signed this self-plus-one option into law as part of the bipartisan Budget Act of 2013. OPM delayed implementation of the new option until 2016.

OPM issued a proposed rule in December and received 64 comments from the five FEHBP carriers, two employee associations or unions and one organization representing carriers. OPM also got 56 comments from individuals, many of whom are enrollees in the federal health care program.

OPM estimated that federal employees should expect to pay a little less under the self-plus-one option versus the cost of self and family coverage. The agency estimated in its fiscal 2014 budget justification that the self-plus-one option would cost about 94 percent of the other coverage options.

Due to lower expected premiums, OPM said the self-plus-one option would result “in score-able savings to the government because the government share of annuitant premiums will decrease. OPM estimated that, in total, savings for annuitants and the government would rise above $450 million in the first year of self plus one. Conversely, costs for non-Postal employees and the government would rise about $450 million for the same time frame.”

Federal employees will have to wait another few weeks to find out whether OPM’s estimates of self-plus-one option being a cheaper alternative comes true.

OPM traditionally announces changes to FEHBP premiums in late September or early October. Federal employees and retirees saw a 3.2 percent increase in healthcare costs in 2015.

OPM also estimated that about 33 percent of the active federal employees with self or family coverage would shift to self-plus one, while about 80 percent of the retirees would partake in the new insurance choice.

“Based on available data and experience, OPM estimates that much of the movement that will occur will result in a shift from one enrollment type to another. There are a limited number of circumstances where the addition of the self-plus-one enrollment type may result in new FEHB enrollees or in enrollees leaving the program,” OPM stated in the final rule. “It is difficult to estimate how many individuals may newly enroll in the program. Most employees who do not participate in the FEHB Program do so because they have access to other insurance options.”

In 2013 while developing the proposed rule, OPM asked the carriers for data on their federal enrollees. The carriers say 60 percent are annuitants and 40 percent are active employees.

“Carriers reported that over one million self and family contracts had only one dependent listed,” OPM wrote. “While this number does not capture the universe of enrollees who may choose a self plus one enrollment, it does provide a starting place for estimating the potential movement between tiers.”

OPM also analyzed enrollment data for the Federal Employees Dental and Vision Insurance Program (FEDVIP). FEDVIP has offered self-plus-one option since 2007.

“There are currently approximately 2.7 million FEDVIP contracts. Of those, 41 percent are self only, 32 percent are self-plus-one, and 27 percent are self and family,” OPM wrote.

OPM said in the final rule the self-plus-one is not an option for everyone. The agency said domestic partners, cohabitating (unmarried) couples and siblings are not considered eligible family members under the law at this time.

OPM sent the FEHBP carriers a letter in April outlining plans to promote the self-plus-one option.

“Because we expect a large number of enrollment changes during Open Season 2015, communications with FEHB enrollees will be more important than ever. We urge you to incorporate the following messages, which emphasize the importance of reviewing FEHB enrollment choices available for plan year 2016, into your Pre-Open Season and Open Season communication campaigns,” the letter said.

OPM suggested the carriers encourage feds to shop around, use the plan comparison tool, to consider self-plus-one if it’s just you and your child under age 26 or you and your spouse and to ensure federal employees understand they will not be automatically enrolled in the self-plus-one option.

OPM also issued a fact sheet and frequently asked questions about self-plus-one.

The agency said in March it expects some other changes to the FEHBP plans as well.

OPM asked carriers to consider five changes for 2016, including giving employees and retirees the ability to compare the costs of drugs online.

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