Attempting to avert a health insurance premium increase for federal employees and retirees, Rep. Connie Morella, R-Md., said she would offer a plan this week to revamp the current formula for the Federal Employees Health Benefits Program (FEHBP), which will expire in 1999.
President Clinton's budget plan assumed the formula would expire, resulting in about $3.8 billion in savings over five years. Without a change in the formula, according to Morella, FEHBP recipients would have had to pay an average of $276 more per year beginning in 1999.
Morella and Sen. Thad Cochran, R-Miss., "said they were studying the use of a 'weighted average' formula for FEHBP to replace the expiring formula," The Washington Post reported Monday. The government's contribution rate would be calculated by first determining the average premium based on the number of subscribers per plan. It would equate to 72% of that amount, but would not exceed 75% of any plan's total premium -- "essentially ... mirror[ing] what happens in FEHBP today."
The government currently pays an average of 71% of the premiums. The House Government Reform and Oversight civil service subcommittee will debate this when it takes up fiscal 1998 budget issues later this week.
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