Health coverage changes for feds could result in a robust open season

A combination of rising health insurance premiums, changing medical needs and plan terminations could mean more federal employees will shop around for new coverage options during this year's open season.

The average premiums government workers pay under the Federal Employees Health Benefits Program will increase 7.2 percent in 2011, according to the Office of Personnel Management. In addition, more than 16,000 federal employees will be forced to choose new health plans this year because their insurance providers are leaving FEHBP, or reducing the areas they cover.

Six plans are ending their FEHBP coverage altogether: Vantage Health Plans in Louisiana; Pacificare of Nevada; AmeriHealth HMO in New Jersey; Community Blue in New York; BlueCHiP Coordinated Health Plan in Rhode Island; and United Healthcare, including consumer-driven and high-deductible options, in 25 states and the District of Columbia. In addition, Coventry Health of Louisiana is eliminating its high-deductible plan.

Four plans are lowering coverage in certain areas: Humana CoverageFirst Consumer-Driven Health Plan no longer will cover employees in Phoenix and Tucson, Ariz.; Jacksonville and Orlando, Fla.; New Orleans and Baton Rouge, La.; Memphis and Nashville, Tenn.; Dallas and Houston; and Salt Lake City. In Ohio, Aetna Open Access is dropping enrollees in Cleveland and Toledo. HealthAmerica Pennsylvania is pulling out of the commonwealth's southeastern region. Fallon Community Health Plan no longer will offer a standard option in Massachusetts, although the basic option will remain.

According to benefits specialists, open season offers government workers the chance to review how they used their health plans the previous year and to determine if changing coverage would lower their expenses.

"We expect there will be more shopping done, especially by retirees, given the fact they will not be getting a [cost-of-living adjustment] and premiums will be rising," said David Snell, retirement benefits manager for the National Active and Retired Federal Employees Association. "They will be looking at alternatives to their current plan if their current plan is expensive and if out-of-pocket costs also are going up. And we will urge them to look at other plans."

Snell said federal employees should make sure their insurance plans and preferred health care providers are participating in FEHBP in 2011. Enrollees can find major coverage changes outlined in plan brochures posted on OPM's website, where there also is a comparison tool, he said.

Employees mulling changing their insurance plan should consider current and future out-of-pocket expenses, such as co-payments and deductibles, in addition to premium increases, said Tracey Baker, a certified financial planner at CJM Wealth Advisors in Fairfax, Va. Coverage for catastrophic injury and illness, preventive care procedures such as mammograms and colonoscopies, and conveniences like mail-order prescriptions also should factor into their decisions, she noted.

Walton Francis, author of the Consumers' Checkbook 2011 Guide to Health Plans for Federal Employees, said FEHBP enrollees should never rule out a particular type or category of plan, like a high-deductible option or health maintenance organization, without first doing their research.

"People should be prudent shoppers," said Francis. "They shouldn't be couch potatoes."

CLARIFICATION: United Healthcare will continue participation in FEHBP through M.D. IPA (mid-Atlantic), UnitedHealthcare of the Midwest, UnitedHealthcare of the River Valley, PacifiCare of California, PacifiCare of Texas, and Health Plan of Nevada.