Dependent Clause

Democratic presidential contender Hillary Rodham Clinton has proposed opening the federal health program to uninsured Americans. While that plan is unlikely to raise premiums in the Federal Employees Health Benefits Program, most federal employees are not too keen on the idea. But the latest congressional proposal, which targets young adults -- the largest and fastest growing segment of the U.S. population without health insurance -- could appeal particularly to federal workers with children.

Last week, the House Oversight and Government Reform Subcommittee on the Federal Workforce passed legislation that would raise the maximum age of federal employee dependents eligible for FEHBP from 22 to 25.

Currently, the federal government cuts off health coverage for dependents on their 22nd birthday. Dependents then have the option of enrolling in a Temporary Continuation of Coverage program, which requires them or their parents to pay the full premium as well as a 2 percent administrative fee.

But the new legislation (H.R. 5550), introduced by subcommittee Chairman Danny Davis, D-Ill., would create a young adult dependent option in FEHBP. Under the option, dependents over 22 would still have to pay the full premium, but not the administrative fee.

At last week's subcommittee hearing, Sara Collins, assistant vice president of the Commonwealth Fund, a private foundation supporting independent research on health care issues, told lawmakers that the number of uninsured young adults ages 19 to 29 rose to 13.7 million in 2006, up from 13.3 million in 2005.

"Young adults are disproportionately represented among people who lack health insurance, accounting for 30 percent of the 46.3 million uninsured people under age 65, even though they comprise just 17 percent of the population," she said.

At least 17 states have raised the eligibility age for dependents of their government employees. Utah, for example, recently changed its law so that dependents don't age out of health care coverage until their 26th birthday, regardless of whether they are enrolled in school. New Jersey provides health care coverage for dependents until they turn 30 years old.

"This is an area in which the federal government should lead, not follow," said Colleen Kelley, president of the National Treasury Employees Union. "Private insurers are offering coverage for young people … yet one of the largest health insurance plans in the country -- one that serves almost 9 million people -- is way behind the curve."

Still, bill sponsor Davis and Del. Eleanor Holmes Norton, D-D.C., expressed concern that the potentially high price tag attached to the measure could prevent it from becoming law.

While no official cost estimate has been calculated, Daniel Green, deputy associate director of the Office of Personnel Management's Center for Employee and Family Support Policy, said covering dependents already in FEHBP for an extra three years could cost approximately $200 million per year. He said the estimate was calculated by multiplying the number of dependents in the 22-to-25 age bracket (245,000) by the annual cost of health care for a young adult ($1,640).

Green added that the government would take on $160 million of the additional cost, with the remainder paid by enrollees through increased premiums.

But Kelley and John Gage, president of the American Federation of Government Employees, argued that increasing the dependent age by three years is likely to decrease premiums, since infusing a large number of young and generally healthy adults into a risk pool of typically older or retired federal employees should come at very little to no cost.

"It's not a matter of simple math," Gage said. "I can't believe that this is a simple matter of multiplying the number of potentials times the cost for young adults, who should be very good at underwriting risk."

Kelley, Gage and Norton all agreed that a more formal analysis of the proposal's estimated cost should be conducted by an independent insurance expert.

"I'm sick and tired of the fact that every time we offer something new to federal employees, we say, 'You can have it, but you have to pay 100 percent,' " Norton said. "When you compare that to what the private sector is offering young people, you'll see why we're having trouble recruiting them."