The House Government Reform Committee could vote soon after Congress returns from
its August recess legislation (HR-1231) to allow federal retirees to pay Federal
Employees Health Benefits program premiums with pre-tax money, a tax break that
would save the typical retire an estimated $300-$500 annually. Under current policy,
active employees may participate in the “premium conversion” arrangement but retirees
may not because of provisions in the tax code. The bill has 284 House sponsors—
significantly more than a majority in the House–and the important backing of
Government Reform Committee chairman Rep. Tom Davis, R-Va. The bill moved
through the committee’s civil service subcommittee just before the congressional recess
and sponsors want to keep up the momentum on the plan, which had never even achieved
a subcommittee vote in the three prior years it was pending in Congress. A counterpart
Senate bill (S-623) has 24 sponsors.
