Diet COLA on the Horizon

• By Kellie Lunney
• September 20, 2012
• comments

Federal retirees again are on track to receive a small annual cost-of-living adjustment boost in 2013, but it will probably be a lot smaller than this year’s increase.

The COLA figure for next year isn’t out yet, but it’s likely to be somewhere around 1.4 percent, based on the latest numbers. The government publishes the annual cost-of-living adjustments typically in late October, based on the percentage increase (if any) in the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the third quarter of the current year over the average for the third quarter of the last year in which a COLA became effective. The cost-of-living adjustment for 2012 was 3.6 percent -- the first increase since 2008.

The CPI-W rose 1.7 percent between August 2011 and August 2012, largely due to an increase in gasoline prices. The average of the July, August and September numbers along with the average figure from the third quarter of 2011 will be used to calculate the 2013 COLA, which is estimated to be about 1.38 percent. In May, the Congressional Budget Office predicted a COLA boost of 1.3 percent in 2013.

Does ...

Forget the Pay Freeze: Start Worrying About Health Care Costs

• By Kellie Lunney
• September 13, 2012
• comments

Buried in the news over the extended federal pay freeze, the impending fiscal cliff and the umpteenth continuing resolution to avoid a government shutdown is this fact: Many military retirees will be paying a little more for their health care as of Oct. 1.

Day 1 of fiscal 2013 means that some TRICARE Prime beneficiaries now will have to pay $39 to $79 more than they currently do in annual enrollment fees. Specifically, TRICARE Prime military retirees who enrolled in the health care program before Oct. 1, 2011, will pay an annual fee of $269.28 for individual coverage as of Oct. 1, 2012; those with the family plan will pay $538.56 per year under the adjustment. Those beneficiaries -- all under the age of 65 -- currently pay $260 per year in enrollment costs for the individual plan and $460 for family coverage. The 2012 National Defense Authorization Act allows for the annual increase of TRICARE Prime enrollment fees for most retired beneficiaries based on the annual cost-of-living increase.

Those enrolled after Oct. 1, 2011 -- considered new enrollees -- already are paying higher annual enrollment fees ($260 for individual and $520 for family), so their rates will increase too but not ...

Roth Progress

• By Amanda Palleschi
• September 6, 2012
• comments

First lady Michelle Obama’s keynote at the Democratic National Convention on Tuesday will be remembered most for her heartfelt tribute to her husband. Viewers heard about President Obama’s rusted old car and the too-small shoes he owned during the couple’s earlier years.

But before the charming anecdotes, viewers got a glimpse of the first lady’s projects during her time in the White House, including the Joining Forces initiative, which she spearheads along with Jill Biden, wife of Vice President Joe Biden.

The program pairs the assets of federal agencies and private sector groups with the strengths of military members, veterans and families. The White House announced in August that 125,000 veterans and military spouses have been hired or trained by 2,000 private sector businesses.

“These companies are not making these commitments just because it’s the right thing to do -- which it is -- they’re doing this because it’s the smart thing to do for their bottom lines,” Michelle Obama said last month at an event in Mayport, Fla., to herald the milestone.

The initiative forged partnerships with the Defense Department, customer service, health care and telecommunications companies, and encouraged states to adopt ...

An Upside to the Pay Freeze

• By Kellie Lunney
• August 30, 2012
• comments

It’s safe to say the two-year federal pay freeze has not been popular with government workers. Even those who support the freeze acknowledge its limitations: the savings it has generated (estimates are between $60 billion and $70 billion) is a drop in the deficit-reduction bucket, and it’s not exactly a morale booster. The GOP policy platform, which calls for overhauling the federal pay system to bring it in line with the private sector’s, and Obama’s decision to postpone a 0.5 percent pay boost 2013 until Congress passes a budget, has put the issue in the crosshairs once again.

But there could be an upside to the pay freeze for feds. It puts a slight chink in the argument that federal employees are way overpaid compared to private sector workers -- a debate that rages on both sides and probably will never be settled definitively. The libertarian Cato Institute, the Washington think tank that has argued federal employees are too generously compensated compared to their private sector counterparts, acknowledged in a recent blog post that the “federal pay advantage” has narrowed, partly as a result of the two-year pay freeze.

“Average private sector wages in the United ...

A 'Measly' Pay Raise Is the Least of Feds' Worries

• By Kellie Lunney
• August 23, 2012
• comments

Most of you have heard the news by now that President Obama will extend the current federal pay freeze until Congress passes a budget for the next fiscal year. If you’re not aware of this latest twist in the federal pay drama, then I envy you, because it means you are probably lying on a beach somewhere enjoying the last remnants of summer.

To briefly recap, the president announced Tuesday evening that he is using his authority under the law to give federal employees a 0.5 percent pay boost in 2013. But the across-the-board salary increase is contingent upon Congress accomplishing what it is apparently incapable of these days: agreeing on a long-term spending plan to fund the government. Lawmakers are on track to pass a six-month continuing resolution when they return from recess, which means that feds will have to wait until at least April for a pay increase. Of course, government workers might have to wait longer than that if lawmakers push through another stopgap spending measure after the first one expires.

So, what does this mean to federal employees? It depends on your perspective. Federal employee unions range from apoplectic to disappointed over Obama’s ...