‘Premium Conversion’ Bill Clears Panel

Meanwhile, another measure of keen interest to retirees, HR-1231, which would allow retirees to participate in the health insurance “premium conversion” tax break, has passed the House Government Reform Committee. The measure would alter the tax code to allow federal retirees to pay Federal Employees Health Benefits program premiums with pre-tax money, a break that saves the typical actively employed enrollee more than $400 a year. Like the GPO and WEP bills, the premium conversion bill has gathered a majority of House members as co-sponsors, but now faces referral to the House Ways and Means Committee, where there are concerns about its cost, an estimated $7 billion over 10 years, and the precedent it would set for private sector retirees. Meanwhile, the Government Reform panel also approved HR-1151, which would put into law a policy in effect since 2000 under an executive order granting public transit subsidies of up to $100 a month for employees in the Washington, D.C. area; the bill also would allow the use of government passenger carriers to shuttle employees between their worksites and mass transit facilities.