2022 FEHB Program Changes

In recent years, there have been significant program-wide changes to the FEHB program. The recent change that has been probably been the most important to Federal employees was coverage of adult children until age 26. Another recent change of great importance to Native American tribal employees was to extend to them eligibility to enroll in FEHB plans as if they were federal employees.
For this year there are several major changes. First, a bad surprise can happen to the unwary consumer who uses a provider that isn’t in the preferred provider network of the consumer’s health plan. Some plans cover out-of-network care at an increased enrollee share, but some don’t cover that care at all. And the sky can be the limit for the charges that the enrollee may face when going out of network, often after an accident and with no control over who will provide care. Last year Congress acted on a bipartisan basis to pass the “No Surprises Act”. This new law bans almost all surprise billing and takes effect for almost all insurance, including all FEHB plans, on January 1, 2022. Second, in recent years the FEDVIP dental and insurance program has been expanded to cover military families and military retirees. In 2022, OPM plans to expand FEDVIP eligibility further, to many part-time and temporary employees. Third, as part of the effort to keep the Postal Service solvent, postal employees will now pay the same premiums as most General Schedule employees. Postal workers were always FEHB members, but until 2022 most were given better premium rates.

Finally, starting several years ago OPM has asked plans to adopt cost-saving coordination with Medicare, a reform that saves money for the program because Medicare usually pays first, which reduces FEHB premiums, and also offers savings for annuitants because their out-of-pocket costs are reduced. Most national plans already had such “wraparound” benefits. Dozens of local plans have now added them. Most annuitants with both Parts A and B of Medicare now can enroll in a wide range of all plan types—PPO, HDHP, CDHP, and HMO—that provide these savings. OPM now also allows plans to reimburse enrollees for part of the cost of Medicare Part B premiums, and use of this technique is growing fast. But the biggest change is that plans are now allowed to offer special “Medicare Advantage” plans to their enrollees as part of their FEHB enrollment. Medicare Advantage is an insurance program modelled after the FEHB program but with added improvements, and now attracts over one-fourth of Medicare enrollees. This new feature started small, but there are now over seventy plans offering this option. Most of them provide free or greatly reduced cost sharing, and many also reimburse most or even all of the Part B premium. These changes have greatly changed the calculus for the “to B or not to B” decision upon turning age 65, and now make Medicare Part B enrollment a far better buy than in years past.

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