No Need for Part D

Civil servants are pretty much set when it comes to health insurance and prescription drug coverage. Premiums get costlier each year, but the coverage itself is sound and even older employees with more medical needs have the luxury of ignoring the horror stories surrounding enrollment in President Bush's new drug program for seniors, known as Medicare Part D.

Right?

Probably -- at least according to the Office of Personnel Management, which administers the health insurance program for federal employees.

"OPM has determined that the prescription drug coverage offered by plans participating in the [Federal Employees Health Benefits Program] is, on average, comparable to Medicare Part D prescription drug coverage," the agency said in a November letter to benefits coordinators. "Thus, you do not need to enroll in Medicare Part D and pay extra for prescription drug benefits."

Still, participants should compare their prescription drug coverage under FEHBP to what's available through local Medicare prescription drug plans to be sure, OPM said. Check out the brochure that providers in the FEHBP publish; there is a section detailing prescription coverage for each. Medicare's Web site also offers a comparison of coverage options.

If employees find themselves the exception to OPM's rule, then they can enroll in Part D at a later date without paying a fee, as long as they retain FEHBP coverage, too.

It is possible to have both plans, and OPM encourages employees to keep FEHBP coverage if they enroll in Medicare. The two plans coordinate benefits, in some cases covering each other's gaps.

As Blue Cross Blue Shield, one of the largest providers in the federal employee program, noted, "It is almost always to your advantage to keep your FEHBP coverage."

Why? For one thing, retirees who stop FEHBP coverage are not allowed to re-enroll in the program.

There's a price to pay on the Medicare side as well. Employees who drop FEHBP coverage and fail to enroll in Part D for 63 days or longer will have to pay premiums that are higher by 1 percent for each month they did not have equivalent prescription drug coverage.

For example, according to OPM, "If you go 19 months without Medicare Part D prescription drug coverage, your premium will always be at least 19 percent higher than what most other people pay. You may also have to wait until the next open enrollment period to enroll in Medicare Part D."

Some employee groups were concerned when Bush and Congress were formulating the Part D plan that it would chip away at FEHBP drug coverage, but OPM's edict may put those worries to rest.

As the Web site of the New York chapter of the National Active and Retired Federal Employees Association states, "Federal retirees who are awaiting receipt of a letter from their FEHBP health plan carrier concerning the 'comparability' of Medicare Part D should not hold their breath ... as they say in New York ... fuhgeddaboutit!"