How to sock away — or lose — $1,000 next year

The first time I met federal health plan guru Walton Francis was decades ago. I think it was at an all-fed conference in Palm Springs or somewhere nice, but hot, in August. I knew he was THE MAN when it came to the massive, excellent federal health program, so I popped into his seminar. As I recall, he told people they could either stick around and listen or go home. If they chose the latter he said they should get $1,000, if single, $2,000, if married, in small bills. Then climb to the roof or deck of their apartment building and throw the money into the wind. He said that most feds who fail to shop for health insurance do that: They “lose” a thousand or two each year because they pick the wrong health plan. Which is understandable.

The federal employee health benefits program, FEHBP, is almost too good to be true. It offers everybody — no age, gender, preexisting condition barriers — 20 or more nationwide plans — Blue Cross, Aetna, GEHA, APWU, NALC etc. — plus 200 local HMOs. Something for everybody. And the government pays about 72% of the total premium each year no matter how much premiums go up. There are also plans that allow you to accumulate a savings account. Or get money from the plan to invest. They pay you!

Each year, Walt Francis edits Checkbooks Guide to Health Plans. It also has a popular online version that lets you compare plans and premiums and see if your doctor is in network. Many federal agencies this year are subscribing to the online version so that employees can shop, from home or office, to get the best plan. It works for Uncle Sam too because since the government pays the lion’s share of your premium the more you save the more we — you, me and other taxpayers — save.

What is required from you is a little time and effort. Shop a little, save a lot. Do you know what a high deductible plan is? And why it is such a good deal for many? Why does The New York Times say that too few people — way too few — have or even know about health savings accounts. I know two people with HSAs, their money from the insurance companies worth more than $20,000.

Walt Francis says that many — maybe most — feds are in the wrong plan right now. Not that it’s a bad plan, but because its premiums have gone up. You can get the same, sometimes better, coverage by shopping around. Most retirees are in the “wrong” plan in the sense they are paying too much because they haven’t shopped around. It may be an excellent plan, but they could get similar coverage for less. Again, if you shop around.

Over the next few weeks we’ll be bringing you a series of columns on best buys for you. There are probably a half dozen you should consider that include your doctor(s) in their network. With lower copayments and/or premiums. Or both. Stay tuned.

Or you can hit the credit union and (again, small denominations please) hurl a couple of thousand bucks from your roof top. It won’t help with your medical bills next year but it will get you noticed by the neighbors!

If you have questions, send them to our Open Season hotline.

Nearly Useless Factoid

By Alazar Moges

The American taxpayer pays for the GPS service enjoyed throughout the world. All GPS program funding comes from general U.S. tax revenues. The bulk of the program is budgeted through the Department of Defense, which has primary responsibility for developing, acquiring, operating, sustaining, and modernizing GPS.

Source: Global Positioning System

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THRIFT SAVINGS PLAN TICKER

Dec 01, 2020 Close Change YTD*
L Income 22.0880 0.0454 4.04%
L 2025 10.9632 0.0514 -
L 2030 37.9432 0.2193 8.24%
L 2035 11.2965 0.0714 -
L 2040 42.3740 0.2915 9.51%
L 2045 11.5224 0.0845 -
L 2050 25.0528 0.1959 10.56%
L 2055 11.9801 0.1171 -
L 2060 11.9802 0.1171 -
L 2065 11.9803 0.1171 -
G Fund 16.4968 0.0004 0.89%
F Fund 21.0938 -0.073 7.35%
C Fund 54.4504 0.6078 13.93%
S Fund 69.6009 0.4102 22.95%
I Fund 34.1572 0.3378 3.37%
Closing price updated at approx 6pm ET each business day. More at tsp.gov
* YTD data is updated on the last day of the month.