The postal population will be carved out into its own premium pool, with slightly higher cost. Image: isak55/Shutterstock.com
In announcing rules for the separate health-care program for Postal Service employees and retirees, OPM said that “At present, there remains a great deal of uncertainty with respect to the longer-term impacts on plan enrollment, carrier participation, plan design, and plan premiums.”
While the formula for splitting the total cost of premiums between the enrollee and the employer will remain the same in the Postal Service Health Benefits program, the postal population will be carved out into its own premium pool.
Said the OPM notice, “The segmentation of the current FEHB risk pool will result in premiums reflective of each separate risk pool’s health care utilization and costs, which are estimated to be higher for Postal Service enrollees compared with non-postal. This may result in a slight reduction” of the growth of FEHB premiums for those left in that pool.
Meanwhile, it said, the shift of some costs onto Medicare in the PSHB could have the same effect there. Those retiring from the USPS in 2025 or later generally will have to enroll in Medicare Part B—and pay those premiums as well—with Medicare becoming the primary payer (see related story).
Said OPM, “It is estimated that the cost of coverage for Postal employees and their eligible family members is slightly higher than for the other federal employees. The creation of a separate risk pool for Postal Service employees and annuitants will result in premiums that are more reflective of the resulting postal and non-postal populations. Removal of these individuals from the FEHB plan population will therefore result in slight reduction in average per member costs which will be directionally reflected in FEHB plan premiums following PSHB implementation.”
“The expected decrease in FEHB plan premiums would be mirrored by a slight increase in PSHB premiums, although this increase would be minimal compared to the expected decrease in premium due to Medicare enrollments, meaning that the likely result will be lower premiums for PSHB plans compared with current FEHB plan premium amounts.”
However, it made no firm projections, saying that the effect on premiums for both those in the new program and those remaining in the FEHB is “highly uncertain because enrollee and carrier reactions to the effects on Medicare, the FEHB program, and the new PSHB program are unknown.”
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