More than 25,000 Feds Will Have to Switch Health Plans in 2015

More federal employees will see their health insurance plans drop coverage next year than in any year since 2009, according to the Office of Personnel Management.

Five plans previously offered in the Federal Employees Health Benefits Program will no longer make their plans available when Open Season begins Nov. 10, which will affect more than 25,000 feds and retirees. Four new plans were added to FEHBP for 2015 coverage.

The new plans are:

• United Healthcare Insurance Company - Offering a plan for Washington, D.C.; the Chicago, Ill. area; Maryland; the San Antonio, Texas area; and Northern Virginia, as well as in Miami, Orlando and Tampa, Fla.; and the Atlanta, Ga. area.
• Priority Health - Offering a plan in the Lower Peninsula of Michigan.
• Keystone Health Plan West - Offering coverage in Western Pennsylvania
• Innovation Health Plan -- Offering coverage in Northern Virginia

The plans dropping out are:

• United Healthcare of the Midwest, Inc. - Discontinuing coverage in Illinois and Missouri
• Coventry Health Care - Discontinuing coverage in Maryland
• Total Health Care USA - Discontinuing coverage in Michigan
• Anthem Healthkeepers, Inc. - Discontinuing coverage in Virginia
• Optima Health Plan - Discontinuing coverage in Virginia

OPM called the decisions by the providers to leave FEHBP a business move based on “enrollment, penetration in the marketplace and overall margin/profitability.”

“The plans’ reasons for leaving continue the pattern we’ve seen over recent years,” OPM said.

Only two plans dropped out of FEHBP in 2014, however, affecting fewer than 3,000 workers. 2015 will therefore see a more than 750 percent increase in the number of employees with dropped plans. The 25,000 federal employees and retirees forced to find new coverage is the most since 2009, when more than 61,000 enrollees saw their plans dropped.

Non-postal FEHBP participants will pay, on average, 3.8 percent more toward their premiums in 2015. The increase is steeper than the rise in the government’s portion of the premiums, which will go up 3 percent. The employee share is increasing faster because employees are choosing better plans that require more out-of-pocket costs. Overall, the government pays about 70 percent of employees’ premiums.

There will be no significant, program-wide benefit changes in 2015. OPM said it instead focused negotiations on keeping costs down. FEHBP plans must offer coverage for nine new preventative services, however, such as screening certain adults for hepatitis C, screening those with high risk of lung cancer and counseling and intervention for alcohol and tobacco misuse.

Enrollees in the federal flexible savings account plan will also see some changes in 2015. For the first time they will be able to carry over up to $500 of unspent funds into 2016 to pay for eligible health expenses incurred in 2016. However, there is no longer a grace period for  health care accounts, and employees must re-enroll each year to have access to carryover funds. Employees will still have until April 30 to submit prior-year claims. In addition, the minimum contribution will be lowered to $100, while the maximum will be $2,500.

Open Season will run from Nov. 10 through Dec. 8. Between 4 percent and 7 percent of enrollees typically switch plans annually.

(Image via Pixsooz/Shutterstock.com)