Lowest Increase in Health Insurance Premiums for Federal Employees Since 1996
Every year federal employees including those who have retired await the dreaded news of an increase in the health insurance premiums which they have to pay. However, this year has turned blissful for them as the rise in premium prices is not as much as they had initially anticipated.
According to the published figures, federal employees will only have to witness an average of 1.3% higher rate in 2019, which is the lowest price increase in insurance premium rates since 1996, although back then the price had increased only by 0.6%.
Contributions to the overall insurance fund are made both by the government as well as employees at different rates. Premium rate increase is also different for both stakeholders, as employee contribution will increase by 1.5% while government’s share will increase by 1.2%. Although it may sound like the employee share has increased significantly, but in reality this is the lowest increase since 1995.
Low Price Increase Is Good News
According to Alan Spielman, who is the director of the Office of Personnel Management (OPM)’ Healthcare and Insurance department, the increase in premiums stems from the enrollment figures of 2018. However, they may change if there are significant variances in enrollment figures moving forward, such as changes originating from a decision by people to switch to an insurance policy that is cheaper or offers a more suitable coverage package. If such a switch does take place, the actual premium increases may be lesser than what has been anticipated.
Considering the fact that the price increase is lowest in a couple of decades, there is a chance that it will continue to drop in the future as well, possibly even result in a decrease in the premium rates. This decrease is stemming from the closure of many insurance plans that have ceased to exist, leaving a high number of enrolees looking for an alternative plan to keep themselves covered under insurance.
In 2019, the total number of plans which will be offered under the FEHB stands at 265, which is three more than the number of similar plans offered in 2018. National-wide plans will be around 16, which is one more than the 15 which were offered in the current year.
The plans to be cut include Healthnet which is part of Arizona, California-based UnitedHealthcare, the plan offered in River Valley by the name of UnitedHealthcare Plan, and the Physicians Plus Insurance Corporation, all of whose clients would be informed through mail that they would need to start looking for another insurance coverage scheme now that these are being dissolved.
Three Types of Plans
To make it easier for customers to choose their insurance packages, after appropriate regulatory action took place to ensure carriers had the required permission to be able to offer three options in coverage plans, regardless of type, customers will now be able to choose from three options such as the self plan, the self-plus one plan, and the self plus family plan.
The plan designed for one person, as the name suggests, covers only one person who signs up for the plan. The self plus one plan came into existence in 2016 with the purpose of providing a plan that was more suitable for those who only had one other member of their family to cover.
Although the self plus one plan has seen an increase in popularity ever since its inception, there is still a significant number of insurers who opt for the self plus family plan even when the requirement is only to provide coverage for two people.
Telehealth services have expanded as far as their availability is concerned, and management of chronic care has also enhanced. There are incentives which multiple plans have inserted to encourage those FEHB enrollees who have already entered retirement and are now eligible for Medicare to enroll in Medicare Part B.
The restriction which had been in place on high-deductible health plans, discouraging them from making contributions to the health savings accounts for gaining tax advantage, have also been removed. As a result of this move, around 33% of high-deductible plans have planned to increase the amounts of account contributions which they will make.
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