Health, life insurance & a shrinking tax break
Health insurance is a must-have item for everybody. But there is more than health insurance at issue during the big benefits hunting season that kicks off Nov.12...
Health insurance is a must-have item for everybody. But there is more than health insurance at issue during the big benefits hunting season that kicks off Nov. 12 and runs through Dec. 10. Sleep through it at your peril.
Although the health insurance portion generates the most interest and action, there are other choices to make during the open-enrollment period. And some that you should review. One of the changes involves a reduced tax break in the Flexible Spending Account program.
So here’s what’s at issue:
- FEHBP Open Season. During the upcoming open-enrollment period, active and retired feds, their survivors and, in some cases, adult children and ex- spouses, can pick their 2013 health plans. Most people have dozens of choices through national fee-for-service plans and managed-care health maintenance organizations.
The FEHBP covers nearly 9 million people from newborns to centenerians. Nobody can be rejected by a plan because of age, status, lifestyle or pre-existing conditions. Workers and retirees who are close to exhausting the catastrophic limits on one plan can, during the open season, switch to a new plan and start all over. During the open season, we will have a series of “best buy” columns for different groups of workers and retirees and a series of Your Turn radio shows (Wednesdays at 10 a.m.) featuring Consumer Checkbook’s health expert Walton Francis and David Snell director of benefits for the National Active and Retired Federal Employees Association (NARFE).
- Flexible spending accounts. This year and in previous years, people could enroll in Flexible Spending Accounts, having up to $5,000 (in pre-tax dollars) taken out of their paychecks over the year. Since the FSAs are pre-tax, that reduced your taxable income while letting you pay for uncovered medical fees, services and prescriptions via the FSA account. Individuals could also set aside $5,000 for child care in an FSA. Because of the Affordable Care Act, the $5,000 medical FSA limit will be reduced to $2,500 in January. The child-care FSA will remain at $5,000.
- Dental and Vision Insurance. Feds who wish to sign up for or continue with dental and vision insurance can do so during the open season.
- Long Term Care. The Federal Long Term Care Insurance program does not have regular open seasons. But you can still sign up for the program anytime.
- Life Insurance. The popular Federal Employees Group Life Insurance Program does not have open seasons, unless premiums or benefits change. But workers can sign up for FEGLI anytime. For many, FEGLI is the best deal around. For some, it is the only way they can get affordable coverage. For others — especially young, healthy workers — there are other options like WAEPA. In some cases, WAEPA premiums can be much lower and policy-holders are eligible for rebates.
Today at 10 a.m. on our Your Turn radio show, John Montague, who runs the WAEPA program will talk about how it works and how it compares to FEGLI. Sean Reilly, a senior staff writer with The Federal Times, will provide the long view of the U.S. Postal Services ever-changing financial picture, the status of the 2013 federal-military-social security raise and the dangers — or not — of sequestration.
Listen if you can (1500 AM or online), and if you have questions email them to me at mcausey@federalnewsradio.com or call in during the show at (202) 465-3080. The show will be archived here.
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Mike Causey
Mike Causey is senior correspondent for Federal News Network and writes his daily Federal Report column on federal employees’ pay, benefits and retirement.
Follow @mcauseyWFED
