USPS would realize large financial gains from its proposed health care plan outside of FEHB, primarily by increasing retirees’ use of Medicare, GAO has said in calling on Congress to consider the impact of authorizing the changes.
Under the plan all postal employees and retirees – about one million individuals – would be withdrawn from FEHB.USPS estimates that its plan would reduce its retiree health benefit liability by $54.6 billion, eliminating its unfunded liability, and the plan would also reduce USPS’s required total annual health care payments by about $7.8 billion in the first year and by $33.2 billion over the first five years of implementation, according to GAO-13-658.
The Postal Service projects its plan would also increase the $550 billion that the federal government spends on Medicare each year by about $1.3 billion in the first five years.
GAO also said Congress will need to consider other aspects of the USPS proposal, including establishing safeguards for USPS health plan assets and ensuring FEHB-comparable protections for USPS health plan participants.
