Budget Hawks Target TSP, Scammers Target TRICARE and More
A weekly roundup of federal pay and benefits news.
House Republicans have a lot of ideas about how to save taxpayer dollars. Unfortunately for federal employees, a number of those ideas would come at their expense in the form of retirement and health benefits.
As Eric Katz reported earlier this week, a House Budget Committee report suggests increasing federal employees’ pension contributions, effectively resulting in a pay cut of between 2 percent and 5 percent. Under their plan (which President Obama has said he won’t support), the defined benefit program eventually would be phased out entirely in favor of just a defined contribution system for an estimated savings to the government of $127 billion over 10 years, the committee said.
House Republicans also proposed phasing out the Federal Employees Retirement System annuity supplement, designed to boost the annuity of young retirees, as well as limiting the rate of return on the Thrift Savings Plan’s Government Securities (G) Fund for an estimated savings of $32 billion over 10 years.
The committee report takes issue with how the interest rate on the G Fund is calculated, noting that “Those who participate in the G Fund are rewarded with a long-term rate on what is essentially a short-term security.”
As Federal News Radio explains: “The report suggests, in essence, basing the G Fund's interest rate on a three-month average rather than the current four-year average. It estimates the change would save up to $32 billion over 10 years.”
Kim Weaver, director of external affairs for the Federal Retirement Thrift Investment Board, which operates the TSP, told FNR that under the Republican proposal, "It would drop the interest to virtually zero, which would make the G Fund worthless to our participants. It wouldn't even begin to keep pace with inflation."
Retirees and who rely on the Federal Employees Health Benefits Program also would see some changes under the GOP plan, which would tie the government’s share of premiums for retirees to inflation rather than the average cost of plans. Postal employees would also have to contribute more toward their health and life insurance premiums under the Republican plan.
Just in time for Women’s History Month, the Office of Personnel Management is developing a handbook on Leave for Pregnancy, Childbirth, Adoption, and Foster Care. In a blog post, OPM Director Katherine Archuleta wrote, “I believe it is important for Federal employees and their managers to fully understand our policies related to family life events. We do not want women to feel that they must choose between their responsibilities to their family and their obligations to their careers.”
OPM plans to survey agencies in the coming months to identify work-life programs that work as well as misconceptions and questions. They’ll analyze the data and send a report to the president that describes “best practices, barriers, and limitations in achieving work-life balance. It also will suggest possible solutions to roadblocks that working families encounter,” Archuleta said.
And finally, a reminder to TRICARE members: the military health insurance plan never calls beneficiaries to ask for personal information. An ABC News affiliate in Tampa reported that military personnel were the target of a telephone phishing campaign. The callers already had some personal information but requested members’ Social Security numbers, allegedly to qualify them for new pain medication.
According to WFTS, a spokesperson said it was a "phishing scheme mainly to obtain information so these pharmacies can bill TRICARE thousands of dollars for these compounded pain creams."