TOPICS
TOPICS
Pay with Plastic
The next time you visit the doctor, you might be able to leave the cash at home. Federal employees will soon acquire special debit cards to pay for some health care costs.
The Office of Personnel Management, which administers the health insurance program for federal workers, is piloting a debit card program this summer for enrollees in plans run by the Government Employees Hospital Association (GEHA) who also have flexible spending accounts.
Participants will be able to pay for health expenses with cards linked directly to their FSA, eliminating the reimbursement process. If this summer's test run goes well, OPM plans to extend the program to all employees.
"You walk into the doctor's office and instead of giving them a credit card or whatever for their $10 or $15 co-pay, you just give them the debit card, and it will be automatic," said Frank Titus, OPM's assistant director for insurance services.
OPM is hoping the debit cards will boost interest in FSAs, which allow employees to make pre-tax salary contributions into a savings account to pay for medical expenses not covered by insurance.
Items that can be paid for with FSAs include over-the-counter medicine, braces, acupuncture, substance abuse therapy, some infertility treatments, birth control, contact lenses, diaper rash creams, diabetic supplies, flu shots, laser eye surgery and mental health care.
Titus said the number of enrollees in the federal FSA program is comparable to privately sponsored plans, but it's not high enough.
"I don't understand for the life of me why we only have 10 percent of the eligible population enrolled instead of 90 percent," Titus said. "I think some people think that when you talk about using pre-tax dollars and saving tax dollars, somehow the [tax] return is going to get more complicated, but it doesn't."
There are a couple of catches for debit program participants. One is that OPM also will require employees to be enrolled in paperless reimbursement in order to sign up. And, for some items, such as over-the-counter drugs, Titas said employees still may be required to submit receipts to validate the transaction.
Since the program won't launch until the summer, details still need to be worked out.
Teeth for Two
Government workers will have optional dental and vision coverage by the end of 2006. There will be a new option for enrollment in the benefit, as well.
In addition to the traditional "self" and "self plus family" choices, enrollees will be able to choose "self plus one" when signing up for dental and vision insurance. The premiums would cost more than those for a one-person plan but less than for a family plan. The extra option could be used by married couples without children or couples with grown children on their own plans.
"It will be interesting to see what the premiums look like with respect to that," OPM's Titas said. "There are a lot of individuals who write us and believe they are overpaying for insurance because they are self-and-spouse, and they feel like they are subsidizing people with large families."
Dental and vision coverage, which will not be subsidized by the government the way that standard medical coverage is, was authorized by Congress in December 2004. Titas said OPM received 26 proposals from insurance providers to offer the supplement, including both national and regional plans. There also are a couple of plans willing to provide international coverage.
OPM staff members are vetting the proposals, and Titas said they do not yet know how many contracts they will award.
COMMENTS
- One of the reasons why I don't use the program, is that I can not afford to put the money aside in a pretax account, then pay out of my pay check for expenses, and after that hope I get my money back after a couple of weeks. No thanks. Plus each year changes for me on what I spend at the doctors office. I can not afford to loose money. If there was a roll over I might consider it and if there was a debit card program to use like most private sectors use. Reader Posted October 15, 2007 2:52 PM
- There are several reasons why people may not be using FSA. First, the funds expire and do not roll over into the next year. I just spent approximately $800 on glasses and prescription sunglasses just to keep from losing the funds for 2005 (I really didn't need the sunglasses). Secondly, I purchased a teeth whitening kit from my dentist only to find that it is considered "cosmetic" and therefore I was not reimbursed. If the program covered things that my health benefits do not cover; i.e. teeth whitening, laser hair removal, sclerotherapy, visits to a naturopathic doctor (preventive medicine), vitamins/natural supplements, etc. I believe there would be much more participation. It is difficult to determine, when you are otherwise healthy, what expenses you might incur throughout a year. This program may want to consider authorizing people to get out of the program if it is determined that they do not have a need for it or it has become a concern in their personal budget. On another note, why is it that the U.S. government, as large of a sector that we are, does not have better health benefits (including dental and vision) for its employees? There is no excuse for us not having the best benefit program. Are politics involved with a mission of only benefiting the government and not their employees? The "new" dental and vision program that will be available soon should be subsidized by the federal government instead of coming totally out of the employee's pocket. A Concerned Federal Government Employee GovExec.com reader Posted March 30, 2006 8:49 AM
- Please beware. No one should use a debit card for anything! What is the advantage to us of giving them instant access to our money? Charge it and let them wait 28 days to get the money. You are giving up a month of interest on everything you put on a debit card. Over one's lifetime that is a lot of money that the financial institutions have moved from them paying to you paying. Taxpayer Posted March 20, 2006 7:41 AM
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