Federal Medicare Costs Rise Slightly for 2022
Federal employees enrolled in a medicare plan under the Federal Employee Medicare Program can expect their medicare costs to increase by about 2.4% for 2022, according to figures released by the Bureau of Personnel Management on September 29.
Based on the legally binding cost allocation between government and employees, this cost increase translates into an average increase of 3.8% for employees and 1.9% for government.
“Quality health insurance has never been more important, and the OPM makes sure that all eligible registrants have the information they need to make informed decisions about their coverage,” said the director of the OPM, Kiran Ahuja, in a press release. “The global pandemic underscores an employer’s responsibility to provide their workforce with quality, affordable and reliable health care options. As the largest employer in the United States, the federal government is proud to lead by example with a wide selection of FEHB and FEDVIP health insurance plans that provide the quality coverage that every employee deserves.
Health insurance cost increases for 2022 are lower than in 2020 and 2021, although they are still nearly double the record 1.3% increase from 2019.
If the federal government receives the 2.7% salary increase that President Joe Biden intends to implement for 2022, the average health insurance premium costs for the federal government will be around $ 4. , 8% of their salary, according to OPM, a slight increase on the average of 4.7% of the salary cost. to federal authorities in 2021.
“It is clear that the administration has done a better job in maintaining the employees’ share of premium costs in the FEHB program for 2022, and we welcome this progress,” said the national president of the National Union of Treasury Employees, Tony Reardon, in a statement. “But we will encourage our members to prepare for price increases and use the upcoming open registration season to weigh all of their options to decide which plan is best for themselves and their families.”
Federal employees are not sure to see exactly how the average costs of their personal plans will increase, as some plan costs may be lower or higher in 2022, due to enrollment numbers, average annual costs, age of registrants and other factors. Fed that change plans between 2021 and 2022 could therefore see an above or below average increase, no increase at all, or even cost savings.
“While higher costs for coverage may be inevitable, federal employees and retirees should be aware that there are many options to choose from during the opening season. While most enrollees will see a less than five percent increase if they re-enroll in their current plans, it’s still important to re-evaluate your options. NARFE encourages all participants to thoroughly review the plans to select the one that best meets their needs, ”National Association of Federal Active and Retired Employees, Ken Thomas, said in a statement.
According to OPM, the increase in insurance costs has been largely due to drug prices, chronic disease costs and medical innovation. Costs related to COVID-19 and increased demand for mental health services have also pushed up prices, and OPM reported that COVID-19 cost the FEHB program approximately $ 1 billion in 2020.
But the pandemic has also reduced medical insurance costs, as many insured people delayed medical procedures and used their insurance less in the first months of the pandemic.
The vaccines and the mandate for federal employees to receive them are also expected to reduce the overall costs of COVID-19 in 2022, as the federal population will be less likely to experience severe coronavirus infection.
The feds will have 275 plans available for next year, one less than in 2021, with the same 18 national plans open to the feds in any part of the country.
The remaining 257 plans are available in some areas of the country and represent 192 health maintenance organization plan choices, 37 high deductible health plan choices, and 28 consumer-focused health plan choices.
These options represent a move away from HMO plans – which offer lower costs for networked providers but rarely cover off-network services – and towards HDHP plans – which offer lower premiums but higher deductibles.
Of the 23 new plan offerings from existing FHB carriers, 20 are HDHP, and the new carrier, Healthkeepers Inc. of Virginia, is also offering an HDHP plan.
Federal authorities also have a choice of 18 fee-for-service plans – which pay health care providers directly or reimburse registrants for services rendered – and 28 consumer-focused health plans – which set limits on health care providers. medical expenses before the share of registration fees increases.
FEHB providers will also need to introduce a new feature in 2022 to notify registrants when a drug requiring prior authorization is about to expire.
Prior authorization is a process required by insurers for certain drugs that may have cheaper alternatives, have dangerous side effects, may be used for purely cosmetic purposes, or are designed for very age groups and medical conditions. specific.
When a doctor writes a prescription for such drugs, the insurer institutes a review process to determine if they will cover the drug.
Patients taking maintenance drugs must have the prior authorization for those drugs reviewed periodically, otherwise it will expire, and the new 2022 requirement means that FEHB carriers will have to notify registrants 45 days before such an expiration occurs.
The open season for the FEHB program begins on November 8 and ends on December 13.
Jessie Bur covers the federal workforce and the changes most likely to impact government employees.