Reg Jones Expert's View

The Office of Personnel Management has announced the 2020 health, dental and vision program premiums, setting the stage for the annual open season for federal employees and retirees to elect coverage for the following calendar year. (This year’s open season is November 11 – December 9.)

According to OPM director Dale Cabaniss, “Today’s announcement is the culmination of a yearlong effort. Our employees have worked tirelessly on behalf of feds and retirees to secure them world-class healthcare and give them the knowledge to make informed decisions for their families.”

OPM went on to say that average total premiums for current non-postal employees and retirees enrolled in plans under FEHB will increase 4.0 percent, calling the increase in line with averages over the past five years. It characterized last year’s lesser increase as “historically low.”

That 4 percent is the average of both the employer and employee contributions. The employer side is determined by a formula that caps that amount, resulting in increases in the enrollee share being larger, 5.6 percent.

According to OPM, one reason for the jump in FEHB premium costs from last year’s 1.3 percent was Congress’s decision not to waive the Affordable Care Act’s Health Insurance Providers Fee. That fee is an excise tax on many health insurers, including many in the FEHB program. That fee had been waived for 2019, cutting about 2 percentage points off premiums for this year.

It further noted that “under the Federal Employees Dental and Vision Insurance Program (FEDVIP), the overall average premiums for dental plans will increase by 5.6 percent, and the overall average premium for vision plans will increase by 1.5 percent.” Enrollees pay the full cost under that program so no premium sharing formula is at work there.

OPM closed its press release with these words:

“Federal Benefits Open Season begins November 11 and ends December 9, 2019. The annual Federal Benefits Open Season gives federal employees and retirees and other eligible individuals the opportunity to reviews their FEHB and FEDVIP plan options, make changes, and enroll for the upcoming benefit year that begins January 1, 2020. Federal employees may also use open season to elect to make pre-tax contributions to health care and/or dependent care flexible spending accounts under the Federal Flexible Spending Account Program (FSAFEDS).”