One More Time on Affordable Care Act

With the annual benefits open season affecting FEHB under way, a misunderstanding seems to be continuing in the federal workforce regarding Affordable Care Act insurance plans. So-called Obamacare has no impact on eligibility for FEHB coverage except that members of Congress and their personal staff, who until this year were eligible for FEHB on the same terms as federal employees in general, must get their health care through the exchanges (or from another source such as a spouse’s employment)—and, to keep the government contribution toward premiums, they must enroll in one plan offered in the District of Columbia’s exchange. Other FEHB-eligible persons could voluntarily leave the program to get insurance through an exchange but there are strong reasons not to, primarily the loss of the employer contribution, which is worth about 70 percent of the total premium cost in FEHB. They also would risk losing eligibility to carry FEHB into retirement, since that generally requires having been covered in that program for the five years leading up to retirement. Also, premiums for exchange plans must be paid with after-tax money, unlike in FEHB where pre-tax payment effectively makes the premiums more affordable for active employees.