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

Back in 2010, as the health care reform debate was raging on, Senate Republicans proposed legislative language requiring lawmakers to drop their insurance coverage in the Federal Employees Health Benefits Program and enter the newly created exchange market.

The proposal was a political gambit, attempting to force Democrats to cast an embarrassing vote to opt out of one of the Affordable Care Act’s major provisions. Democrats called the bluff, however, and the amendment passed easily.

Three years later, members of Congress and their staffers are faced with the reality of losing FEHBP coverage.

The Office of Personnel Management has not yet issued regulations on how this switch will play out. Jonathan Foley, director of OPM’s Planning and Policy Analysis Office, recently told the House Oversight and Government Reform subcommittee that oversees the federal workforce that OPM is “in the process of writing regulations in response to the law,” but would not offer further detail.

Currently, the federal government covers about 70 percent of health care premium costs for lawmakers and their aides. It is unclear what percent, if any, the government will cover when the legislative branch moves to the exchange market.

OPM also will have to determine ...

Could This Be the Year for Federal Pension Reform?

  • By Kellie Lunney
  • April 25, 2013
  • comments

Simpson and Bowles have rolled out yet another version of their deficit reduction proposals, and federal pension reform is still in there.

The famous 2010 bipartisan fiscal commission led by former Republican Sen. Alan Simpson from Wyoming and former Clinton White House Chief of Staff Erskine Bowles last week released its latest plan, which calls for $2.5 trillion worth of spending cuts and tax increases. Like President Obama and many lawmakers, the duo thinks federal employees need to contribute more to their retirement benefits. They also favor moving to a less generous formula -- the so-called chained CPI -- to calculate retiree cost-of-living adjustments.

“Military and civilian pensions are both out of line with pension benefits available to the average worker in the private sector, and in some cases, out of line with each other across different categories of federal employment,” the new version of the plan states. Simpson-Bowles recommends “gradually” increasing federal civilian pensions “so that new federal employees ultimately pay about one-half the cost of their pensions, and existing federal employees pay one-quarter.” New employees now contribute 3.1 percent of each paycheck to their defined benefit, while most current feds put 0.8 percent of their pay toward ...

Lawmakers Put Their Benefits -- And Yours -- At Risk

For Republican Rep. Ted Yoho, it is all about trust.

“When members of Congress break the law, they break trust,” Yoho said.  

And for the Florida lawmaker, trust stands for Trust Returned to the United States Taxpayer, or the TRUST Act, which he recently proposed.

Yoho’s bill would force any member of Congress who is convicted of a felony to forfeit the taxpayer-funded portion of his pension.  He argued members of the military currently face the same punishment.

“If our service men and women who lay their lives on the line for our nation lose their pension with a dishonorable discharge, should not members of Congress be held to the same standard?” Yoho asked on the floor of the House when introducing his bill.

He added now is the perfect time to take up his legislation.

“These days with public opinion at record lows and public debt at record highs, the TRUST Act is a place to start in restoring the faith of the American people in their government.”

What Would Chained CPI Cost You?

The National Active and Retired Federal Employees Association -- which has strongly condemned President Obama’s proposal to reduce benefits for federal retirees and Social ...

A Mixed Budget Bag for Feds

  • By Kellie Lunney
  • April 11, 2013
  • comments

Budget Day 2013 has finally arrived. Federal employees should not be surprised by the pay and benefits proposals in President Obama’s latest plan, as this is a well-traveled road with all the familiar twists and turns.

Obama wants government workers to contribute more to their pensions starting in 2014, a proposal he also floated in his fiscal 2013 budget plan. Right now, most feds contribute 0.8 percent of each paycheck to their pensions; the president’s proposal would increase that by 1.2 percent, phased in over three years, resulting in a 2 percent contribution level by 2017. In the area of federal pay and benefits, that’s a rare example of agreement between the White House and most congressional Republicans.

It’s always been a matter of when, not if, current federal employees will have to pay more for their retirement benefits. Between the president’s fiscal 2014 proposal and the recent House-passed budget blueprint, which recommends that feds pay more for their pensions, it looks like this idea’s time finally has come. Remember, new hires after 2012 and those with fewer than five years of previous federal service now have to contribute 3.1 percent ...

Deciding Who Gets Furloughed Is a Sticky Wicket

Congress has asked the Pentagon to shoulder about half the spending cuts resulting from sequestration, more than $40 billion, in the remainder of fiscal 2013. For months, the Defense Department has been wrestling with how and where to implement the cuts.

Budget leaders were given some extra flexibility recently, when a spending bill to keep government operational through September transferred $10 billion into the Pentagon’s operations and maintenance accounts. This prompted Defense Secretary Chuck Hagel to scale back furloughs for the department’s civilian workforce of nearly 800,000 employees from 22 days to 14.

Not everyone at Defense will be furloughed, however. Military personnel are exempt by law. But the Pentagon also will exempt or protect certain fields by policy, Defense Comptroller Robert Hale said last week during a webinar hosted by the Association of Government Accountants and the American Society of Military Comptrollers.

Policy protections include family programs on military bases. While programs like schools for military families are subject to budget cuts, fear not, a soldier’s daughter will not have to repeat the second grade due to sequestration. Teachers will not be furloughed to the “extent we have to ensure our kids get a creditable ...