Federal employees' health benefits change
May 7, 2010
FORT RUCKER, Ala. -- Significant changes in federal employees' health benefits plans begin next year.
The changes have to do with health insurance reform, the Patient Protection and Affordable Care Act, signed into law by President Barack Obama March 23.
Many of the changes in PPACA won't occur until 2014, but some are going to begin as early as Jan. 1. One such change is the extension of coverage for Family members until age 26.
According to Margie Field, Civilian Personnel Advisory Center labor relations specialist, children could be covered under their parents' health benefits plan until age 22, prior to the PPACA.
"For parents who had children in college (who) turned 22, there were no provisions," Field said. "Under the PPACA that changes that issue."
However, some questions still remain about what will happen to children who turn 22 before the new provision takes effect Jan. 1, she added.
"(Office Personnel Management) is looking into that issue with members of Congress to further clarify what's going to happen to those in that situation," Field said.
However, according to the labor relations specialist, there are some provisions for Family members who are turning 22 this year.
"To have continued health coverage in their own plan they can file for TCC, which is temporary continuation of coverage," Field said. "It's sort of the government's version of Cobra laws."
According to Field, TCC allows Family members who are no longer eligible to continue health plans, although they will have to pay full premiums. In order to file for these benefits, a federal employee would have to contact the Army Benefits Center within 60 days of the Family members' 22nd birthday to qualify for continued benefits.
Another change likely to affect new federal employees involves the Thrift Savings Plan, Field said. Originally, newly hired federal employees had the option to contribute to TSP, which goes toward retirement benefits.
Now, newly hired or rehired employees who do not elect to make their own TSP contributions will automatically be enrolled in TSP at a contribution rate of 3 percent of basic pay each pay period, she said.
These employees will have an opportunity to immediately terminate automatic enrollment or elect to contribute more than the 3 percent.
"They have the right to opt out of TSP or contribute more than 3 percent, if they want," Field said. "This is a very important program for new employees to know about."
For current employees, one of the most significant changes involves the Federal Employees Retirement System, she said.
"Up until now, under FERS, sick leave was not creditable toward retirement," Field said. "But, when President Obama signed the National Defense Authorization Act in October, effective immediately, 50 percent of their sick leave will be converted to service credit time. This can increase the amount to their retirement annuity."
As a result of PPACA, beginning Jan. 1, 2014, 100 percent of an employee's sick leave will be used, Field said.
"Any annuity is based on the amount of service time," Field said. "The more service time you have, the better your annuity will be."
Some federal employees have expressed excitement over the changes to FERS.
"I think it's a great idea," Donna High, instructional systems specialist for Directorate of Training and Doctrine, said. "So many people have sick leave they don't use. Being able to use it for retirement will be a good benefit."