It is "difficult" to compare the FEHB program to other plans because of its status as the largest employer-sponsored health insurance program in the United States, a report done for Congress says, adding that the most germane comparisons are with plans of large private sector employers and of state and local governments.
The Congressional Research Service report noted, for example, that a direct comparison can’t be made of one key issue, premium sharing between the employer and the enrollee. In FEHB, although self-only coverage and self-and-family coverage premiums are calculated separately, the cost sharing for each is the same, averaging about 70 percent paid by the employer.
In contrast, it is more common elsewhere to apply different formulas; a survey of large firms showed that on average employers paid 81 percent of the premium for single-coverage plans and 75 percent for family plans. Similarly, a survey of state and local governments found average employer contributions of 89 and 77 percent, respectively.
In addition, under FEHB retirees are eligible to continue coverage with the same benefits and at the same premium rates as active employees (premiums are effectively more expensive for retirees, though, since they no longer can pay them with pre-tax money). In a survey of large firms that offer health benefits to active employees, only 26 percent offered them to retirees at all; among larger state and local government employers, 83 percent offer health benefits to retirees.
Range of choice in the program is another major difference. In a survey of firms with more than 5,000 employees, 32 percent offered only one plan and only 27 percent offered three or more plans. In a separate survey, of employers with between 200 and 5,000 employees, 58 percent offered only one plan and only 1 percent offered three or more plans.
In contrast, FEHB currently offers 206 plans. However, most of them are regional health maintenance organizations, and an enrollee’s choice typically is in the range of six to 15 plans, depending on location.
