GAO Looks at FEHB Premium Issues

GAO has reported on trends in FEHB premiums, concluding that increases in the cost and utilization of health care services and in the cost of prescription drugs accounted for most of the average premium growth over 2000-2007. Decreases in the costs associated with other factors, including benefit changes and enrollee migration to lower cost plans, generally helped offset average premium increases, it said. It said that growth in average premiums recently slowed and was lower than growth for other purchasers in that time—an average of 7.3 percent for FEHB, compared with 14.2 percent for the California state employee health insurance program and 10.5 percent for surveyed employers.