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Federal Employees Health Benefits Program

FEHB Program: General Description

The FEHB program is open to almost all of the government’s civilian employees on a voluntary basis. Exceptions are those workers who are serving their first year of federal employment under a temporary appointment, employed on an intermittent basis, or otherwise excluded by law or regulation.

The FEHB contains a number of features that make it one of the nation’s leaders in the provision of health insurance. For example:

  • within 60 days from the date you enter the government (or become eligible), you may enroll in a health benefits plan with group-rated premiums and benefits;
  • coverage is provided without a medical examination or restrictions because of age, current health, or pre-existing conditions;
  • there are no waiting periods for benefits to kick in after the effective date of enrollment;
  • there is catastrophic protection against unusually large medical bills; and
  • you have an opportunity, during annual open seasons, to enroll in a health benefits plan if you are not already enrolled, or if you are enrolled, to change to another plan or option.

The FEHB law mandates that special consideration be given to enrollees of certain FEHB plans who receive covered health services in states with a critical shortage of primary care physicians. FEHB fee-for-service insurers are required to provide benefits to plan participants in medically underserved areas who use any health care provider licensed to perform the specific medical service. The following states are medically underserved areas under the FEHB program: Alabama, Idaho, Kentucky, Louisiana, Maine, Mississippi, Missouri, Montana, New Mexico, North Dakota, South Carolina, South Dakota, Texas, Utah, West Virginia, and Wyoming.

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FEHB Rules and Procedures

Under FEHB you have a wide selection of plans from which to choose. Currently, there are nearly 190 health plans in the program. One is a government-wide plan, 12 are employee organization plans (only six of which are open to all), and the rest are health maintenance organizations (HMOs). Any eligible employee may enroll in the government-wide plan. Generally, to enroll in an employee organization plan you must be a member of the organization sponsoring the plan. Some organization plans are open to all employees; others are restricted to specific agencies or occupations. HMOs are open to those who live or work within the geographic area serviced by that particular plan. Consult the plan brochure for more information.

By enrolling in an FEHB plan, employees have an opportunity to acquire protection against the cost of health care service for themselves and their families, including individuals suffering from prolonged illnesses or involved in serious accidents. Moreover, these health insurance benefits may be retained by employees after retirement, if they retire under certain conditions and meet certain requirements.

The cost of FEHB premiums is shared by the enrollees and the government, with active employees paying their share through payroll deductions and retirees through annuity deductions.

Federal and postal workers also are covered by Medicare hospital insurance (Part A) for which they pay 1.45 percent of salary each bi-weekly period. Employees become eligible for Medicare coverage when they reach age 65.

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FEHB Eligibility and Enrollment Rules

Generally, all federal and postal employees and retirees, as well as many temporary workers, are entitled to participate in the FEHB program. Enrollment in an FEHB health plan is not compulsory, and employees may decline to participate. (For a list of excepted categories of employees, see 5 CFR 890, or the FEHB Handbook on OPM’s website at www.opm.gov/insure/health.)

Covered employees also include “cooperatives,” those who serve “in cooperation” with nonfederal agencies and who are paid in whole or in part from non-federal funds, such as certain employees of the Agricultural Extension Service, certain Agricultural Stabilization and Conservation County Committee workers, employees transferred to public international organizations under the Federal Employees International Organization Act, and U.S. commissioners. When spouses are both government employees, each may enroll individually or one spouse may enroll for the family. However, the children of such a couple would be covered only if one spouse enrolls under the family option; enrolling individually does not cover children.

If your agency denies you coverage and offers you no supporting documentation, look up the rule yourself in the sources mentioned above, or contact your agency’s headquarters insurance officer.

At the time employees become eligible to enroll, the employing office provides: (1) an FEHB Guide (RI 70-1 for current employees, RI 70-8 for certain temporary employees, and RI 70-9 for retirees and survivors), which explains the health benefits program, compares the benefits under fee-for-service plans, and contains rates, and (2) Standard Form 2809, which is the form used by employees to enroll in a plan or elect not to enroll. Eligible employees may enroll during the annual open season or at other specified times.

Employees in an authorized leave-without-pay or other type of non-pay status generally can continue health insurance coverage for up to one year of the non-pay period. The 365 days of non-pay status may be continuous or may be interrupted by periods in a pay status that last less than four consecutive months. Agencies must give employees the opportunity either to directly pay their share of the premiums for these periods of FEHB coverage or to incur a debt to the agency, if the agency advances their salary in the amount of the worker’s share of the health premium to cover the cost of extended coverage.

FEHB open seasons for making enrollment changes are held each year from Monday of the second full workweek in November through Monday of the second full workweek in December, or as otherwise announced by the Office of Personnel Management. During an open season, employees may make enrollment decisions or changes affecting the health plan coverage of themselves and their eligible family members.

“Eligible family member” includes an employee’s spouse and any unmarried dependent children under the age of 22, including legally adopted children, recognized children born out of wedlock, and foster children or stepchildren if they live with you in a regular parent-child relationship. Unmarried children may be covered regardless of their age if they are incapable of self-support because of an incapacity that began before attaining age 22. Parents or other relatives cannot be covered even though they may live with you.

In some cases, an employee’s former spouse may be eligible for FEHB coverage. (For details, see 5 CFR 890, or visit OPM’s website at www.opm.gov/insure.) Former spouses whose divorce occurred during the spouse’s federal service should contact the agency that employed the spouse when the divorce occurred. Former spouses whose divorce occurred after the spouse’s retirement should contact the Office of Personnel Management’s Retirement and Insurance Service, Office of Retirement Programs, P.O. Box 17, Washington, DC 20044; (202) 606-0500.

Neither employees nor their family members will be required to pass a physical examination to enroll for health benefits. Similarly, neither employees nor their family members can be excluded from joining an FEHB plan because of age or employment in a hazardous job.

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FEHB Plan Options

The FEHB program generally allows federal employees and annuitants to choose between fee-for-service plans, which work on a reimbursement model, and health maintenance organizations (HMO), which provide comprehensive health care on a prepaid basis through contracts with physicians and hospitals in a particular geographic area. The government-wide service health benefit plan is a fee-for-service plan provided through Blue Cross and Blue Shield organizations that any employee may join. It is called a “service benefit plan” because it works on the principle of paying benefits either to the enrolled participant or directly to the doctor or hospital that provides the treatment or service. Blue Cross and Blue Shield also offers a network-only option.

Another type of FEHB fee-for-service plan is the employee organization plan. Any employee who is a member of an organization that sponsors a plan approved by the Office of Personnel Management may enroll in the plan.

In addition to the above plans, the FEHB program offers employees and annuitants the chance to enroll in a number of HMOs. Types of HMO options available to FEHB enrollees include:

  • Group Practice Prepayment Plans—These plans have their own medical center or centers and their own doctors who practice as a group. Employees who live in an area where there is a group-practice prepayment plan that participates in the FEHB program may choose to join it instead of one of the other plans.
  • Individual Practice Prepayment Plans—In these plans, doctors agree to accept payments from the plan instead of requiring the patient to pay their usual charge. Like the group practice plans, these plans operate only in certain areas. Employees residing in a locality that has such an approved plan may choose to join it.
  • "Mixed Model” Prepayment Plans—These are a combination of group practice and individual practice plans.

Employees seeking more detailed information about the types of benefits provided by different plans should consult the plan brochures that can be obtained from most government employment offices or from the OPM website at www.opm.gov/insure/health/download_guides.htm.

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FEHB Premium Rates

The premium rates for FEHB plans typically change each year, following the annual contract negotiations between OPM and each insurance carrier. Any new plan rates resulting from these negotiations begin on the first day of the first pay period in January of the following year for active employees, and Jan. 1 for retirees.

FEHB premium costs are shared by the government and the participating employee or annuitant. Under the “Fair Share Formula,” the maximum government contribution is set at 72 percent of the weighted average cost of all plans, not to exceed 75 percent of the cost of any specific plan. The enrollee pays for the balance of the premium cost.

The government contribution is the same for most federal employees, with the following exceptions:

  • Employees appointed under the Federal Part-Time Career Act of 1978 only receive a portion of the government contribution paid to full-time employees, with the government’s share pro-rated in proportion to the percentage of full-time service regularly performed.
  • Temporary employees pay the full premium (both the employee and government shares).
  • The U.S. Postal Service contributes an additional amount, specified in collective bargaining agreements, toward the cost of a postal service employee’s enrollment.

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For More Information
You may also learn more about the Federal Employees’ Health Benefits Program in the current edition of the Federal Employees Almanac.
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