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Key developments in the world of federal employee benefits: health, pay, and much more.

Super Secretive

So far the public hearings of the joint congressional deficit reduction committee have not addressed proposals related to federal pay and benefits, or really, any actual budget-cutting plans. Of course, that's probably the goal, since the 12 members of the super committee are intent on weighing and debating various deficit reduction ideas largely behind closed doors.

The latest hearing on Wednesday featured Congressional Budget Office Director Douglas Elmendorf in his second public appearance before the committee giving an overview of federal discretionary spending for the past 30-plus years. So where does this leave anxious federal workers? Recommendations from congressional committees that oversee the government workforce and other groups provide a decent snapshot of what could be at risk. Some ideas related to federal pay and benefits that have been submitted to the super committee for consideration include:

  • Cutting the federal workforce by 10 percent through attrition
  • Extending the two-year civilian pay freeze for as much as an additional three years
  • Eliminating step increases
  • Raising the Federal Employees Retirement System contribution by 6.2 percent
  • Increasing the Civil Service Retirement System contribution from 7 percent to 10 percent beginning in 2013
  • Eliminating FERS for new hires, and creating a defined contribution option to supplement the Thrift Savings Plan
  • Limiting the FERS minimum supplement to employees subject to mandatory retirement
  • Raising employees' pension contribution rate by 1.2 percent over three years beginning in 2013
  • Moving from a high-three to a high-five average salary calculation for retirement benefits
  • Allowing the Office of Personnel Management to negotiate pharmacy benefits, including drug prices, for all participants in the Federal Employees Health Benefits Program
  • Mandating annual fees under TRICARE for Life, which pays beneficiaries' out-of-pocket Medicare costs. Fees would start at $200 in 2012 and increase annually to align with those paid by all TRICARE enrollees. TRICARE is the health care system for members of the military.
  • Excluding working-age military retirees from participating in TRICARE Prime, which offers the lowest out-of-pocket expenses of any Defense Department health plan.

Not surprisingly, federal employee groups and several lawmakers representing large blocs of government workers oppose many of these ideas and have sent several letters to the super committee expressing their concern over further cuts to federal pay and benefits. Matt Biggs, legislative and political director of the International Federation of Professional and Technical Engineers, said his group has met with most super committee members to plead its case on behalf of feds.

Biggs said Rep. Chris Van Hollen, D-Md., has been the most helpful super committee member "when it comes to federal workers." That makes sense, as many feds live and work in Van Hollen's suburban Maryland district. "His office has been working with labor in gathering information and input as to how federal workers feel about being targeted once again as prime targets for reaching deficit reduction," Biggs said in an email. Sen. Patty Murray, D-Wash., who co-chairs the panel, assured the union she'd fight against cuts to Social Security and Medicare, according to Biggs. "Outside of this, we were not told a whole lot other than nobody really knew what the outcomes would be, including if there is no agreement," he said.

Nov. 1 is the next public hearing, which will feature testimony from a quartet of deficit reduction experts: former Wyoming Republican Sen. Alan Simpson; former Clinton White House Chief of Staff Erskine Bowles; former Office of Management Budget Director Alice Rivlin and former New Mexico Republican Sen. Pete Domenici. That hearing is unlikely to shed any more light on federal pay and benefits proposals.

The lack of transparency related to super committee deliberations and the fate of federal workers notwithstanding, we'll all know soon enough who's getting the ax. The committee must vote on its $1.5 trillion deficit reduction plan by Nov. 23. The panel has to send its report to Congress and President Obama by Dec. 2, and both chambers must vote on the committee's bill by Dec. 23. Automatic, across-the-board spending cuts totaling as much as $1.2 trillion beginning in 2013 will be triggered if the committee cannot agree on a deficit reduction plan and Congress does not approve legislation by that date.

It will be an interesting -- and busy -- holiday season for us all.


Kellie Lunney covers federal pay and benefits issues, the budget process and financial management. After starting her career in journalism at Government Executive in 2000, she returned in 2008 after four years at sister publication National Journal writing profiles of influential Washingtonians. In 2006, she received a fellowship at the Ohio State University through the Kiplinger Public Affairs in Journalism program, where she worked on a project that looked at rebuilding affordable housing in Mississippi after Hurricane Katrina. She has appeared on C-SPAN’s Washington Journal, NPR and Feature Story News, where she participated in a weekly radio roundtable on the 2008 presidential campaign. In the late 1990s, she worked at the Housing and Urban Development Department as a career employee. She is a graduate of Colgate University.

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