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

Pay Raise Pushback, Veterans Preference, Military Personnel Reform, and More

Is anyone happy with President Obama’s 1.3 percent pay raise plan for federal employees in 2016? It’s doubtful. The plan, announced by the White House Aug. 28, includes a 1 percent across-the-board raise along with an alternative plan for locality pay rates that will bring the aggregate increases to 1.3 percent.

After several years of stagnant wages, the increase isn’t prompting widespread celebration. As the Washington Post noted, Obama’s action, taken because of Congress’ inaction, “prevents what would be a much higher raise from being paid under the complex laws governing federal pay raises should no raise number be enacted into law by the end of the year.”

Some feds are taking their complaints directly to the White House, petitioning for a “meaningful pay raise” on the administration’s We The People website:

The federal workforce has borne a disproportionate burden of austerity: furloughs, pay freezes, benefit erosion, and demoralizing rhetoric from Congress . . . Pres. Obama has pledged to support the middle class, of which feds are members, yet he continues to suggest raises that erode purchasing power. A meaningful raise would help lift workforce morale, retention, and recruitment. It would prove that Pres. Obama...

G Fund Suspension Drags On, Pay Raise Deadline Looms

The Congressional Budget Office now estimates the U.S. Treasury will run out of cash between mid-November and early December, thus giving Congress more time than previously believed to reach a budget deal (or more time to threaten a crisis, depending on your level of optimism).

In March, the country hit its statutory debt ceiling and Treasury began taking “extraordinary measures” to avoid default, including disinvesting a portion of the Thrift Savings Plan G Fund and limiting investment in the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund.

What other measures might Treasury have to take that could affect federal employees? It could:

  • Suspend remaining investments of the G Fund;
  • Suspend the issuance of new securities for the CSRDF;
  • Redeem in advance securities held by the CSRDF of equal value to the benefit payments due in the near future.

As CBO notes, “Those measures provide the Treasury with additional room to borrow by limiting the amount of debt held.” By law, the G Fund and the Civil Service and Postal Service funds must be made whole after the debt limit is raised.

But that doesn’t mean the G Fund won’t face other...

New Health Care Benefits, Another Hack Involving Feds and More

The U.S. Postal Service knows keeping track of all your medical records can be cumbersome, so it has an idea for how to organize them better: through the U.S. Postal Service.

USPS plans to roll out a benefit called “Health Connect” next month as a pilot program for its own employees. The agency sees the program as a means for postal workers to “collect, store and manage their personal health and wellness information in an account completely under the end user’s control.”

Employees can opt into Health Connect on a voluntary basis, the Postal Service said in a recent Federal Register notice. The program has been in the works for months, and is one element in which the agency thinks it can grow its digital capabilities. Participating workers can manage their benefits and keep a “personal health record repository” on their accounts.

The Postal Service workforce may be skeptical to provide their personal medical information to an agency that exposed personnel information through a data breach just last year, but USPS has already detailed the exact measures it will take to protect the information. It also said neither the Postal Service nor any contractors will “view or...

Presidential Contenders and Pay for Performance, Changes to Prescription Drug Benefits and More

This has been a relatively quiet week for pay and benefits news, with Congress leaving town and the Republican presidential candidates largely leaving the federal workforce out of their first debate. The one exception to that rule has been Carly Fiorina, who has made downsizing the federal government a theme of her campaign and said during the “kids table” debate on Aug. 6 that she “understands bureaucracies, how to cut them down to size and hold them accountable.”

Fiorina’s accountability measures would include firing feds more readily (especially those who watch porn, another pet topic of hers), and pay for performance. Republican rival Jeb Bush is also a fan of pay for performance, and gave a speech on civil service reform. But by and large, the other presidential contenders have not made federal workforce issues a focus of their campaigns.

Meanwhile federal employee advocates and officials with the Thrift Savings Plan are taking the opportunity to remind people that proposals to cut the rate of return on the government securities (G) fund may resurface. The immediate threat in the highway bill has dissipated, but “we can’t assume that it’s dead, dead, dead,” said Kim Weaver, the TSP...

Higher Medicare Premiums for Former Feds, Another Crack at Lifetime Credit Monitoring and More

Some federal retirees could soon see a major uptick in their Medicare premiums thanks to a loophole that fails to protect them from low inflation rates.

Because inflation is currently low, there is no cost-of-living adjustment set to kick in for federal retirees or Social Security recipients in 2016. When that happens, the Centers for Medicare and Medicaid Services freezes the premiums for about 70 percent of Medicare Part B recipients.

Included in the other 30 percent, however, are federal retirees in the Civil Service Retirement System. CMS said these individuals would pay a higher premium next year, based on current projections. CSRS participants do not receive Social Security, excluding them from the “hold harmless” protection that prevents Medicare Part B premiums from increasing for most program enrollees.

When premiums are frozen for 70 percent of Medicare Part B enrollees, some costs get shifted to the other 30 percent. The increase could come to about $55 per month -- a 50 percent jump -- for most participants in the program, which covers doctor visits and other outpatient care, according to The Wall Street Journal.

That could affect 800,000 federal retirees, The Washington Post reported.

Nothing is final, however; CMS said it...