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It’s health insurance open enrollment season for the federal government. Workers have until December 9, 2019 to tinker with or overhaul their health coverage for next year.
But what’s new in this year’s bewildering array of plan options–and where might savvy shoppers look to save money? Kojo sits down with Consumer’s Checkbook editor Walt Francis to unpack out-of-pocket costs, premiums, high deductibles, health savings accounts, and more.
Produced by Margaret Barthel
- Walt Francis Editor, "Washington Consumers' Checkbook 2020 Guide to Health Plans for Federal Employees"
KOJO NNAMDIYou're tuned in to the Kojo Nnamdi Show on WAMU 88.5. Welcome. Later in the broadcast the wife of one of the journalists killed in the Capital Gazette shooting last year on finishing her husband's book on high school basketball in this region.
KOJO NNAMDIBut first it's the most wonderful time of the year, federal open enrollment season that is. Up until December 9th federal employees can tinker with or even overhaul their health insurance coverage. For some people sifting through all the plans options not to mention the jargon that comes with them is a daunting prospect. But for the brave at heart or at least the ones who like spreadsheets there's a chance to save quite a bit of money by doing a little savvy shopping. Not sure where to start? We have someone here today who can help you. Walt Francis is the Editor of the Consumers' Checkbook Guide to Health Plans for Federal Employees. He joins us in studio. Walt, good to see you again.
WALT FRANCISNice to see you, Kojo.
NNAMDIWalt, federal employment open enrollment season, what is it and when is it?
FRANCISIt's already started. We're a week into it and the important thing to remember is that it ends on December 9th. So people have only three weeks left and they ought to be making their plan choices sooner not later, because we all know that when the last day comes around the phone lines at OPM will be busy and people will not take the time they ought to take. A simple half hour could be even semi-pleasant.
NNAMDIAre there other times that federal employees have this option to switch their health insurance coverage?
FRANCISQuite a few times if their family or work situation changes. For example, if they get -- if they're an HMO and they're posted to another part of the country or if they get married or have a kid or get divorced. I mean, you know, or when they retire. They have -- depending if they retire after you're 65, I should say, they have various open season choices, but for most people this is it, once a year.
NNAMDIYou have been editing the Consumers' Checkbook Guides to Health Plans for Federal Employees for quite a while. For people who don't know, what kinds of information can you find in the guide that you put out in print and online?
FRANCISThe main thing we do is compare plans based on their likely cost to you out of pocket for both the premium, a for sure expensive, and the potential expenses depending on whether your health costs are low, average or high in the coming year for people in the same situation as you are. Family size and age in particular dictate statistically how high your health care costs are likely to be. And we find multi thousand dollar differences between the plans. I mean, we're not talking about, oh, if I switch plans I might save or lose $50 or $100. No, we're talking about you might save or lose one or two or three or four thousand dollars.
NNAMDIA lot of us find buying health insurance really confusing and anxiety inducing. We'd rather make a decision once about a plan and then not think about it again. What's your pep talk for people like us?
FRANCISWell, that plan that you joined 30 years ago may not have stayed a good plan. It may not have kept up with the times. There are next year about 40 plans in the D.C. area. It's a big increase this year, a lot of new plans, a lot of important new plans. And, you know, maybe of the 39 you're not in, couldn't it just possibly be one or two or three or four of them might be a better deal than the one you're in, not just in terms of cost, but also in terms of all your doctors in the network, how good is the plan service. You may be used to that lousy service and not realize some plans do it better.
NNAMDICan you give us a sense of the scale of the federal health insurance program? How many different plans are available and how many workers does the program cover roughly?
FRANCISIt covers about 8.5 million people, okay, including dependents, about two million workers and about a million and a half retirees plus their families. It's got nationwide about 280 plans are in it, but in any given metro area, say, and in most rural areas there will be about 25 or 30 plans open to all the people who live there. So feds everywhere have this great cornucopia of choices. I mean, it's a table spread with feast and that's part of the problem. It's too daunting for a lot of people to even think about.
FRANCISSo they figure, well, the plan that I took last year or 10 years ago based on the recommendation of my office worker at the next cubicle over. Now that's not the way to do it. That's why -- by the way OPM also has a website. So whether you use the OPM website or just go randomly to a few plan websites or go to the Checkbook website and use our tool, which is free to about a third of the federal workforce through their agencies, who buy access, you can narrow some choices down to two or three really good plans and start from there on the detailed stuff.
NNAMDIWhat about here in the D.C. region specifically? How many people and their families are covered?
FRANCISIf you count all the relatives in all, it's probably well over a majority of all the people. But federal employees are not quite as big a proportion of the workforce as they used to be. So I think it's probably only about a million or a million and a half people in the D.C. area, but that's a lot of people.
NNAMDIIt's my understanding that about half of the people in D.C. have either are federal workers or have a federal worker living in the same house with them marriage or partner or are related to somebody who works for the federal government.
NNAMDIOkay. On to the phones then. Here's Steven in Arlington, Virginia. Steve, you're on the air. Go ahead, please.
STEVEWell, thank you very much. I did want to say I am a long time Washington Checkbook's member. And have just gotten the health guide, but I'm also a retiree from the federal government and I've signed up with Medicare. And I know that the health plans -- it strikes me that the federal health plans really make out well to keep us signed up, because Medicare covers a lot of the medical expenses and they only have to pay then a small percentage. Can your guest give us some guidance on how to sort through all the info to find the best companion federal plan if I'm already enrolled in Medicare A and B?
FRANCISSure. Great question and it's a common issue. And there's good news for you. All the plans -- I should say all the plans have been offered and many have taken advantage of new opium flexibility to improve their Medicare wraparound deal for people with Parts A and B. So, for example, a couple of years ago Blue Cross Basic Options started giving a $600 rebate for people, who would have Parts A and B and join that plan. The rebate this year is up to $800. Aetna introduced a really innovative plan called Aetna Direct, which is a great deal. You get to -- any plan I mention pays all your hospital doctor bills. If you have Medicare Parts A and B you will pay nothing out of pocket for hospital and doctor. So Aetna Direct lets you use of the plan savings account for co-pays for drugs and stuff, but pays 100 percent of your doctor and hospital.
FRANCISThis year there are four new United Healthcare plans in the D.C. area. All of which, but three of which in particular are good deals that will pay $1600 towards your $1700 Part B premium. Taking away the main argument against having Part B, which is why pay two premiums. Okay. So in those plans you get 100 percent wraparound coverage and only basically have to pay one premium, because the other one gets rebated to you. They are new. They do require you to enroll in what's called a Medicare Advantage Plan, which is a whole other system, much bigger actually than the FHBP. It's got about 20 million in Medicare in that system of private plans. And these United offers are so new we're still sort of feeling our way through are there any gotchas? I heard contradictory reports.
FRANCISBut I will just tell that they claim to cover you whether or not you stay in network with any doctor or any hospital that participates in Medicare whether or not it's in their Medicare Advantage Plan or whether or not it's in their FEHB plan. So complete doctor choice, 100 percent coverage of all the costs and you don't have to pay much in the way of extra premium, because you're getting back what you paid on Medicare Part B. So those plans, plus some of the ones I already mentioned, FEP Blue Focus, Blue Cross Basic, Aetna Direct, they are really some superb MBHP high deductible plan, turns out to be good for people on Medicare as is the Care 1st high deductible plan. So there's a lot of good offerings.
NNAMDIQuite a few new plans this year, right?
FRANCISYeah, there's seven new one in the D.C. metro area, several national and several local. So we're now up to 40 plans, which is a lot.
NNAMDIHere is Lynn in Bethesda, Maryland. Lynn, your turn.
LYNNThank you for taking my call, Kojo. So I find that in the Bethesda -- my husband is a federal employee. And we have a family on a plan. We switched a couple of times to try different ones. And what the biggest trouble I have is that the most recommended doctors in D.C. as well as the close in suburbs like Bethesda, for example, do not take any insurance. They do not participate with insurance. And the non-participatory rate from our current insurer is so low that we have many many thousands of dollars of out of pocket expenses. And so I'm wondering if perhaps any of these new plans are better for people whose doctor is not accepting insurance.
FRANCISBy definition they won't be better. But what I'd just like to -- first, you're facing a problem that arises, because D.C. metro area is so affluent. Those K Street doctors and those Bethesda doctors have the ability many of them because they get high ratings in some survey, which may or may not indicate any real difference in their quality, and they can thumb their nose at health insurance. Some of them don't participate in Medicare either. There's no real defense against that. As you know all too well from your own experience, the coverage for out of network doctors, sometimes the plan will say, we'll cover 50 percent of our allowance. Well, their allowance is probably less than half of what he's charging. So they're really paying 25 percent or less. So it's just a problem. You're best solution is to not choose a doctor whose on K Street or Bethesda. All the plans now have online provider directories.
FRANCISCheckbook in our guide, we actually for every plan if you type in, you know, the names of your three or four doctors, say, we will tell you which plans they're currently in as preferred. And that can help you narrow down your choices. Some of these doctors you've been having trouble with may be in plan X even if they're not in plan Y. I do recommend that before you make any decision that depends on Doc Saw Bones being in your plan, call his office and check with the office manager. Is Doc Saw Bones still going to be in the network come January 1st? But there's no -- your problem is endemic to the whole field of insurance.
NNAMDIOkay. Thank you very much for your call, Lynn. On now to Janice in Alexandria, Virginia. Janice, you're on the air. Go ahead, please.
JANICEYeah, hi. Thanks for the opportunity to ask some questions, which I believe has been answered, because I was calling about the Medicare reimbursement account on Federal Blue Cross, which now you say is up to $800, and looks like I have to wait until I get the social security cost of living adjustment statement before I can reapply for next year. Is that correct?
FRANCISNo. I'm not sure. Are you talking about reapplying -- are you in Medicare Parts A and B?
JANICEYes. I am.
FRANCISAre you retired?
FRANCISDon't worry. You are eligible to do whatever you want right now. And in fact if you do something, there's a Medicare open season going on right now ending December 7th and the federal employee one ends December 9th. You make your choice now. It will take effect come January 1st. By all means Blue Cross Basic, which is the Blue Cross plan that pays that $800 rebate is one of our highly recommended choices for people in your situation. But you could take a look at Aetna Direct, and there's a new Aetna Value plan, brand new this year, which is another good choice. So you got two good Aetna choices, at least one good Blue Cross choice, but I'd add the local Care 1st plan. Several of them are wonderful choices for someone in your situation. And then the United plans very frisky.
JANICETo keep things simple, though, I wanted to retain with the Federal Blue Cross Basic. But it was to apply for the Medicare reimbursement, the $800.
FRANCISYou do that through Blue Cross and they have whatever exact -- they'll tell you want paperwork they need. I think they want to see a copy of your some recent Blue Cross statement. It doesn't have to be a new one. I don't think, but they'll tell you. And they're not going to pay you the reimbursement for next year anyway until the year begins. And, you know, so talk to them. It's not a big problem.
NNAMDIJanice, thank you very much for your call. We're going to take a short break. But when we come back we will continue this discussion of federal open season. I'm Kojo Nnamdi.
NNAMDIWelcome back. Until December 9th is open season for federal employees, who would like to change their health insurance plans, and here to help guide is Walt Francis. He is the Walt Francis is the Editor of the Consumers' Checkbook Guide to Health Plans for Federal Employees. Walt, why does the federal government provide such a bewildering array of options for health plans? Many private employers offer only a handful.
FRANCISIt's a historical accident, because the federal government was kind of a latecomer to providing health insurance for its employees. And in the meantime a lot of unions and other organizations had setup health plans that federal enrollees could join. And when it came time to setup a new system, the feds tried proposing a one plan, one size fits all for everybody and the unions and the employer organizations rose up in arms saying, wait a minute. I want to keep my Kaiser, etcetera. I want to keep my GEHA, which has been in this program from when it was a railroad porter organization, okay. By the way GEHA has two new plans this year, which I forgot to mention before, Elevate and Elevate Plus, which are excellent choices for many people.
FRANCISSo the feds inherited this plan competition system and its evolved time into a great system, much better what the private employers offer, okay, because you have so many choices to fit your needs.
NNAMDIYou mentioned Kaiser and Martin in Rockville, Maryland wanted to know why you hadn't. Martin, you're on the air. Go ahead, please.
MARTINIt seems like your guest, you know, has a preference for profit insurance companies. I think Kaiser is a non-profit integrated health plan. It has an extremely wide range. I don't have Medicare Part B, because I don't need it with Kaiser. Extremely wide array of services, they have acupuncture. They contract outside of top doctors when they don't have their own. I had a bypass operation and they contracted out to one of the top John Hopkins surgeons.
MARTINThey have preventive health care. And they're also one of the lowest premiums.
NNAMDIOkay. Thank you very much for sharing that with us. Walt, talk about HMO plans in general. What are they and how do they work?
FRANCISThe HMO plans by definition have a closed panel of doctors. It can be quite a big panel. I mean, a big network sometimes. It's not all that different usually from larger insurers that have PPO plans or fee for service plans. In the case of Kaiser it really is different, because it has -- its doctors are its own employees. Though as the caller, who said it better than I could by the way and I want to emphasize Checkbook rates the Kaiser Basic of Standard Options very highly for almost any circumstance. I just couldn't name every plan. There's so many good ones. But they're excellent choices and they have a wide -- you know, you get to choose your doctors from within their system. I know any number of people, who are life members of Kaiser and love it.
NNAMDIWhat about premiums? Are they up, down or roughly the same this year?
FRANCISThis year it's about a five percent overall increase on average, but as usual it's -- you know, every plan is different. Some plans are up. Some are down. Most are about level. But you should always look at the premium for the plan you're in to make sure there's no gotcha. And, of course, there's a special page in every plan brochure of how the plan changes this year. And maybe the change they have this year it may be one you like or one you dislike. So you really need to pay attention to your family's health situation. The plan you're in even if you don't plan to change both for premiums and coverage.
NNAMDITom called, but he couldn't stay on the line. He's on Blue Cross Blue Shield and Medicare B, but should he switch to something called FEP Blue and why?
FRANCISThat is -- there are three national Blue Cross plans and several HMO plans under the Care 1st rubric, which is the Maryland Blue Cross. It depends, which one he's in as to what he should do. But I would say if it's not FEP Blue Focus is a very good choice. Blue Cross Basic is a very good choice. And the Care 1st HDHP and HMO options are also very good for people with Medicare Parts A and B.
NNAMDIOn now to Deleina in D.C. Deleina, you're on the air. Go ahead, please.
DELEINAHi, thank you so much for taking my call. So I have used OPM's comparison tool previously. And I was actually -- well, first I had Kaiser when I was married without children for a couple of years. And then it didn't work for me. More recently I switched to GEHA PPO and I'm having challenges with what I consider to be high out of pocket cost expenses. I chose it because it had a good PPO and it had a good, you know, biweekly rate. But then I'm finding every time we go to the ER or like -- which has only been twice a year. But that's like costing us $1,000 each time. And so I haven't really -- maybe I'm not using the tool correctly. But I'm trying to understand how to minimize what feels like these very high costs. I know that there's basic and there's high deductible, and I've reached out to multiple people for help on like what do they recommend.
DELEINAAnd so I guess, can you tell me if I'm looking for a plan where I don't want to pay $250, $300, you know, biweekly and I also don't want to pay $1,000 or more dollars for, you know, a visit to the doctor. I don't want to not want to go to the doctor. What kind of plan, I guess, do you recommend? High deductible, PPOs?
NNAMDIAnd we got an email from gbleaker, can your guest discuss how good the high deductible health plans are that are being offered this federal open season?
FRANCISOkay. Let me first in response to the caller, you're not a high deductible kind of person obviously. So my suggestion is take a look at the HMOs. Take another look at Kaiser. There's a new Care 1st plan this year called Care 1st Blue Value Plus, because the expenses are much lower and more predictable, okay, than in the PPO plans like GEHA. But there's also a new GEHA Elevate Plus plan. And I think you -- so take a look at the new Care 1st plan and GEHA Elevate Plus and I think you may quickly -- or Kaiser. And I think you may find one that you're comfortable with.
NNAMDIOn the other -- on the email, how good the high deductible health plans are that are being offered this federal open season?
FRANCISThey're excellent choices for almost everybody. They're not for someone who's got high regular expenses like a diabetic with high, you know, insulin and other costs. But if you're in reasonably good health in terms of recurring expenses, all the high deductible plans give you a health savings account, which is like an IRA on steroids. Money goes in tax free. It grows tax free. You can invest it. It's your money. And it comes out tax free if you spend it on healthcare. They are wonderful choices for people, who can get through the first few years without high medical expenses, because you may never have to pay anything again once your savings account gets built up high enough. And it's your money. In open season you can change plans and take it with you. That said, there's another category called consumer driven where you need to stay in the plan, because you can't take the money with you if you change plans.
FRANCISBut they are even better in their design in many respects except that one than the high deductible. So if you're feeling a little bit frisky there are lots of really good offerings in those two categories.
NNAMDIA lot of healthcare decision making comes down to anticipating any big life events that might be coming up in your life in the next year. Let's take a federal employee, who may be ready to start a family. How would you council someone in that situation on evaluating their options?
FRANCISIt's very straightforward, because childbirth is a big expense. If you have already chosen an obstetrician, I would talk to the obstetrician about which plans pay your costs best. And the answer will be probably many do, because a lot of plans now offer -- you pay nothing for childbirth, nothing for the visits, nothing for the hospital stay or the delivery or maybe a little bit. You know, $10 or $20 or 50 bucks. So you want to be in one of those plans. And let me make a plug for the brochures. Each plan has a brochure that's a PDF file, in common format, in plain English and you can compare brochures by typing in a word such as childbirth, a phrase like that or maternity. And it will take you to the paragraph in the plan that explains their maternity benefit. And you want to look for the plan that says you pay nothing.
NNAMDIHere's Rebeca in Salisbury. Rebeca, you're on the air. Go ahead, please.
REBECAI appreciate you both taking my call. My husband and I had been considering -- he's been a government employee for over 30 years, considering changing insurances just, because we find ourselves limited by the doctors that are plan allows us to use. However in February I was diagnosed with metastatic breast cancer. This is an ever escalating cost disease. And it is terminal, but it is a pre-existing disease. So now if we want to change our insurance, with what had been our plan before just to make things easier and to go to the doctors we really wish to go to, does having this pre-existing condition now lock me into where I'm at and would it take away our chance to explore other options?
FRANCISNot to worry. One of the nice things about this program is open season wouldn't be much of a benefit unless the plans were required to take anyone, who joins them during open season without regard to any pre-existing conditions period. So you should join the plan that is going to work best with your physician or physicians, okay. And you can check obviously with the physician office as to which plans are most likely to cover both the doctor cost and you're going to have a lot of drug costs too probably. And that will help narrow down your choice. Do not hesitate a moment to change plans. This is a perfect example of why the federal employee system is so good. Precisely because you will be able to pick the plan that's best for your chances and I wish you great luck.
NNAMDIAnother big life event is retirement. And there are a lot of federal employees who have to consider it as they approach that day. Federal employees carry their insurance into retirement, right. Generally speaking, how does that process work?
FRANCISIt's a big gotcha. You have to be continuously enrolled in the FEHB for the five years before you retire, okay, to carry the plan into retirement. So that's the big thing to be sure you've done. But once your retire, you have all the regular same choices during open season. And once you hit age 65, you could choose whether or not to add Medicare Part B. Medicare A is pretty automatic. And these days we recommend everybody should choose Part B because there's so many of these wraparound that will pay all or most of the premium options.
NNAMDIYou said that people often seek out information or advice from their colleagues or friends about how to approach healthcare decisions. What's the one thing that you hope that people listening to this program will take away and share with their colleagues and friends during open enrollment season?
FRANCISOne thing to take away is don't do what your friend does just, because they do it. People are pretty lazy about this and if the person in the cubicle next to yours says, join plan X. I've been in it for 20 years. It's wonderful. That is not necessarily good advice. So the answer is do at least a little detective work. Whether you just get on a few plan websites or go to the OPM website or use the Checkbook tool, get a little bit of diversity of choices there. Compare two or three plans. And think about your health choices as well as your, you know, the biweekly premium is not the be all and end all. You need good coverage as well as low costs.
NNAMDII'm afraid we're out of time, but there are still a lot of people on the line and emailing and tweeting who would like information. They, I guess should subscribe to the Editor of the Consumers' Checkbook Guide to Health Plans for Federal Employees or find it online.
FRANCISYeah, or anyone who sends an email if WAMU could forward it to me, I will be glad to answer those questions.
NNAMDINot a problem. Walt Francis is the Editor of the Consumers' Checkbook Guide to Health Plans for Federal Employees. Good to see you again. Thank you for joining us.
NNAMDIGoing to take a short break, when we come back, the wife of one of the journalists killed in the Capital Gazette shooting last year on finishing her husband's book on high school basketball in this region. I'm Kojo Nnamdi.
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