Premium Conversion Seems Stuck

One retirement-related measure that made some progress in 2005 but that quickly bogged down is the effort to allow retirees to participate in “premium conversion”-the payment of Federal Employees Health Benefits premiums with pre-tax money. That measure cleared the House Government Reform Committee, as it did in the prior Congress, but got stuck in the House Ways and Means Committee, as it did in the prior Congress. The Ways and Means panel remains concerned about the potential cost in lost tax revenue, especially if the measure set a precedent for similar favorable tax treatment for private sector retirees.