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Federal Employee Health Benefits
by Steve Gross
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Overview
The Federal Employees Health Benefits Program Handbook says that the federal health-care benefits package contains more than enough options to meet every employee's individual and family health-care needs. That's a broad claim, but the choices available to federal employees do in fact cover the managed health spectrum, from plans with low premiums and high deductibles, through all three fee-for-service plans.
Whether you are in the process of making a career decision, or are already a federal employee, you should take time to become familiar with the benefits of the many health-care options.
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PPOs
Preferred provider organizations let you pick your own primary care physician; the hospital and other (e.g., OB-GYN) service providers. They do have networks of service providers and reward you for using within-network care with lower out-of-pocket costs (co-payments and deductibles).
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HMOs
Health maintenance organizations are unique in that they control both the cost and the delivery of health-care services. They require that you select a primary-care physician who assumes responsibility for coordinating your care and that you use in-network service providers. Individual HMOs have a geographic area, called a service area, within which they accept members. Some plans may enroll people who work inside the service area but do not reside there.
There are three types of HMOs: group practice plans that use groups of physicians practicing at medical centers to provide care; individual practice plans that use participating physicians practicing in their own offices; and mixed model plans that combine group and individual practice plans.
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POS
If you select a point-of-service plan, you will be able to decide whether you want to use HMO or PPO benefits each time you visit a health-care provider. POS plans have a provider network and offer significant savings incentives to their members to use it.
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High-Deductible Plans
As their name implies, high-deductible plans have higher deductibles and "stop loss" (catastrophic coverage) levels than other plans. Depending on the plan, you may be able to choose in-network or out-of-network providers. As usual, choosing to use in-network providers can save you money.
Some POSs and HMOs also offer high-deductible plans. In these plans, when you enroll, the plan creates either a health reimbursement arrangement or a health savings account for you and then automatically credits your HRA or deposits your monthly "premium pass through" into your HSA.
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Consumer-Driven
Consumer-driven plans give you the opportunity to choose how you will spend your health-care dollars. In-common features of typical plans include responsibility for some up-front costs, an employer-funded account you can use to cover the up-front charges and a high "stop-loss" level.
