Federal employees and retirees have from Nov. 8 through Dec. 13 to check in with your current plan, explore others and maybe make a few changes.

This exclusive e-book jumpstarts your research and plants the seeds of your knowledge base that tools from the Office of Personnel Management and from the private sector can help germinate and grow.

Account balances of $30,000 to $40,000 are not unusual. At least one fed has $100,000 in their health savings account, which is offered by a growing number of FEHBP plans. The open season when people can pick their 2021 health plan ends Dec. 14. So there is still time to figure if this is the time to consider an HSA, a flexible spending account or a high deductible or consumer driven health plan.

Health savings accounts and health reimbursement accounts (HRAs) provide “significant tax advantages,” according to Walton Francis, editor of Consumer’s Checkbook Guide to Health Plans for Federal Employees. And they can permit policyholders who build up large financial accounts.

HSAs have the most advantages, he says, because “you can add to your HSA account by advance planning, just as if it were a flexible spending account. Second, while you can only establish an FSA account in advance you can add to your HSA account any time during the year — if you have unanticipated late year expenses of an extra $1,000. In most HDHPs you can have $1,000 transferred from your account to your pay, to your HSA, lowering your taxable income by $1,000, pay the bill through the HSA, and obtain what amounts to a one-third discount on your unplanned  expenses.”

Or, Francis says, you could transfer the extra $1,000 even if you don’t have any unexpected expenses, saving one third in taxes, and build up your account for future years.

He said that since you have the HSA account for life, “regardless of Open Season plan changes or retirement — and it can accumulate tax-free earnings — it can become a very substantial lifelong protection against health care expense.”

Nearly Useless Factoid

By Amelia Brust

From 1934 to 1986, paddlers and anglers in Minnesota’s remote Boundary Waters Canoe Area Wilderness could get drinks from Dorothy “the root beer lady” Molter. She made the beverage from the waters of Knife Lake. Her isolated and rugged lifestyle made her a celebrity, and she even won a fight with the U.S. Forest Service to stay on the land after the Wilderness Act of 1964 required her to close her fishing camp and sell root beer “for donations.”

Source: Atlas Obscura

Many people believe that the leading export of Washington D.C. is BS rhetoric and data. BS being the short-hand for the mysterious, hard-to-pin down “Bureau of Stuff.” Which in D.C. shorthand is BS. Many claim it’s very existence a myth. Others say it is more powerful than the Pentagon or State Department.

Anyway, according to the latest projection there is minimum 20% chance you are in the wrong health plan. And that you are very likely paying more than necessary in premiums. And, if you take the following health plan pop quiz, there’s an 80% chance that 50 percent of your answers will be incorrect. This is important because the federal health insurance hunting season runs through Dec. 14, and experts say many of you could save $1,000 to $2,000 in premiums next year if you spend a little time shopping during the FEHBP open season. This is especially true for retirees who may have been in the same health plan for years. So… is that BS or fact from more reliable sources? Ready for the quiz? Answer each question either yes or no.

1. For a couple without dependent children, it is almost always better to buy a self-plus one plan vs. a family package?
2. If you’re a fed who’s covered by your private sector spouses’ health plan, could you be forced to spend an extra 5 years in government?
3. The standard option of most health plans usually provides better coverage than the “basic” option which has lower premiums?
4. There are circumstances where suspending, not cancelling, your FEHBP coverage pays off?
5. There are plans in the FEHBP that actually pay your premiums and give you money for a savings account or to invest in the stock market?
6. Can non-postal workers join plans sponsored by postal unions, and if so, should they?
7. Basically all you need to know about a health plan is whether your doctor or doctors are in network?
8. Some plans have a much lower disputed claims record than other plans. Is that true, and if so, does it matter?
9. Health insurance expert Walton Francis (editor of Checkbook’s Guide to Federal Health Plans) talks about certain plans which he says are the equivalent of a Roth-IRA On Steroids. But they are only for young, health workers?

Answers: 1. No — 2. Yes — 3. No — 4. Yes — 5. Yes — 6. Yes — 7. No — 8. Yes — 9. No

So how’d you do? Get more right than wrong? Don’t feel bad if you didn’t. There are lots of moving parts in deciding which of the health plans (30 to 40 in the D.C. area) to pick. Nationwide most other feds, retirees or survivors are eligible to join 20 or more plans. With no restrictions. Uncle Sam pays most of the tab: 70-75%. Applicants can’t be rejected because of age, preexisting condition or any other reason. If, because of serious accident or disease, you get close to the catastrophic limit of your current health plan, you can simply switch to another plan and start all over again. If your doctor moves from one plan or network, you can move with them. If dental or prescription benefits improve in one plan, you can move to it during the open season. But a little shopping is necessary.

Which is why we’re calling on Walton Francis to again be our guest on Your Turn, streaming live here or on the radio in the D.C. area at 1500 AM every Wednesday at 10 a.m. EST. He’ll talk about what you should be looking for, and what to avoid, while navigating the open season. Walt spent many years in a top job at the Department of Health and Human Services. No BS data in his knowledge base. Just facts. He’s also been a consultant for the Centers for Medicare and Medicaid Services. And for more than four decades, he’s edited the Guide to Health Plans, which is also on-line and available free to many federal workers. Francis says many feds and retirees can save a bundle of money simply by comparing three or four plans over the next few weeks. The show will also be archived so you can listen later. If you have questions, email them to me before showtime.

Nearly Useless Factoid

By Alazar Moges

On April 11, 1803, while negotiating to purchase New Orleans, LA, from the French for $10 million, the U.S. delegation headed by Robert R. Livingston is dumbfounded to be offered the 828,800 square mile “Louisiana Purchase” instead for $15 million. Livingston accepts without consulting President Thomas Jefferson to prevent Napoleon from rescinding the offer.

Source: Census Bureau Fast Facts

Hint: Most people punt, which is the worst option. Doing nothing is something, but it leaves you totally without control. Experts say that at least 20% of you are in the wrong plan, paying too much in premiums for what you get back in benefits and coverage. In fact, you can even stay in the same health plan family and get a better deal. But some effort is required. And if past is prolog, most people will again do nothing. They will stay in the same health plan without even considering if they would benefit by changing.

Unfortunately, that’s the worst-case, but a very real scenario for many federal workers and even more retirees during the health insurance open season, which kicked off last week and runs through December 14. During the open season, feds and retirees in the Washington D.C. metro area have the same good-news-bad-news option: They have the choice of between 30 and 40 plans and options offering wide array of benefits, coverage and doctors, and an equally wide array of premiums. Feds outside the D.C. area have at least 20 plans and options to choose from. The good news is that all of the plans are good-to-excellent. They offer good coverage (some better than others), and a wide variety of options (some better than others). All are good. Some better for you than others. Also the government will pay the lion’s share of the premium — 70-to-75%. And you can’t be turned down by any plan for any reason.

The downside is that while all the plans are good, some cost too much considering what you get back. Most feds are in Blue Cross-Blue Shield, which has a number of choices and options. Walton Francis, author of the Consumers Checkbook Guide to Health Plans, says both are good, but he recommends people in the BC-BS standard plan check out its basic option. Lower premiums and you must use network physicians. But, as he says, many are in that network and it could save you a bundle. The difference in premiums is $1,000 to $2,000 per year for singles and couples. Worth putting on your list of plans to consider.

Some of the most popular health plans are not good buys simply because most popular means that many of them are top-heavy with older people. In the insurance industry they are called “heavy users” because they see doctors more often, require more treatments and have higher prescription drug needs. A healthy young couple in a plan full of older workers and retirees is probably going to pay too much in premiums for what they get back in coverage.

Francis says the most important consideration — by a long shot — in picking a health plan based on its catastrophic coverage. This so-called limit-to-you is the amount you will pay out of pocket if you have a year where you or a family member have a serious illness or accident. The catastrophic coverage (total amount you will pay) can range from as little as a few thousand dollars to close to $30,000. Think what that would do to your bank account. Your TSP balance. Financial experts say that most Americans couldn’t handle a surprise $800 bill in one year. And that was before the pandemic and millions lost their jobs and health coverage.

Feds also have the option of picking high deductible (HD) health plans that offer them cash they can save to pay medical bills and or invest. Some people have accounts worth $20,000 or more, some invested in things like the S&P 500 or other accounts. Francis calls them Roth IRAs on steroids because taxes don’t touch them. We’ll have more about that in upcoming columns and on our Your Turn radio show. This Wednesday our guest was Walt Francis. He explained how you can smart shop during the open season. You can use the Checkbook guide (which readers of this column can get at a 20% discount if you use the promo code FEDERALNEWS) or the excellent website developed by the Office of Personnel Management. And its free. Also Checkbook has signed on with many federal agencies so you can search online, for free. You can check out the Checkbook website here.

Bottom line: Do something. Don’t let this be another year when inertia rules. When you are baffled by the premiums, benefits and changes. Francis says around 20% of all feds are in the wrong plan. Each year only about 6% make a change.

Nearly Useless Factoid

By Alazar Moges

The Gateway Arch in St. Louis, at 630 feet, is the tallest national monument in the country. The Arch is 75 feet taller than the Washington Monument and over twice as tall as the Statue of Liberty. The popular tourist destination commemorates the nation’s westward expansion.

Source: National Park Service

The federal employee health benefits program, FEHBP, is almost too good to be true. It offers everybody — no age, gender, preexisting condition barriers — 20 or more nationwide plans — Blue Cross, Aetna, GEHA, APWU, NALC etc. — plus 200 local HMOs. Something for everybody. And the government pays about 72% of the total premium each year no matter how much premiums go up. There are also plans that allow you to accumulate a savings account. Or get money from the plan to invest. They pay you!

Each year, Walt Francis edits Checkbooks Guide to Health Plans. It also has a popular online version that lets you compare plans and premiums and see if your doctor is in network. Many federal agencies this year are subscribing to the online version so that employees can shop, from home or office, to get the best plan. It works for Uncle Sam too because since the government pays the lion’s share of your premium the more you save the more we — you, me and other taxpayers — save.

What is required from you is a little time and effort. Shop a little, save a lot. Do you know what a high deductible plan is? And why it is such a good deal for many? Why does The New York Times say that too few people — way too few — have or even know about health savings accounts. I know two people with HSAs, their money from the insurance companies worth more than $20,000.

Walt Francis says that many — maybe most — feds are in the wrong plan right now. Not that it’s a bad plan, but because its premiums have gone up. You can get the same, sometimes better, coverage by shopping around. Most retirees are in the “wrong” plan in the sense they are paying too much because they haven’t shopped around. It may be an excellent plan, but they could get similar coverage for less. Again, if you shop around.

Over the next few weeks we’ll be bringing you a series of columns on best buys for you. There are probably a half dozen you should consider that include your doctor(s) in their network. With lower copayments and/or premiums. Or both. Stay tuned.

Or you can hit the credit union and (again, small denominations please) hurl a couple of thousand bucks from your roof top. It won’t help with your medical bills next year but it will get you noticed by the neighbors!

If you have questions, send them to our Open Season hotline.

Nearly Useless Factoid

By Alazar Moges

The American taxpayer pays for the GPS service enjoyed throughout the world. All GPS program funding comes from general U.S. tax revenues. The bulk of the program is budgeted through the Department of Defense, which has primary responsibility for developing, acquiring, operating, sustaining, and modernizing GPS.

Source: Global Positioning System

But by now most people in the 30-plus plans and options have made their decision, which is to stay in the same plan they were in this year — and last year, and maybe since they joined the government, or retired from it.

By the numbers only about 6% of participants change plans during any given open season even though experts, like Walton Francis of Consumers’ “Checkbook Guide to Health Plans for Federal Employees,” say more like 60% should change — to get better coverage and in many cases to save thousands of dollars in premiums.

The good news for the inertia gang is that all of the health plans are good-to-excellent. But in some cases premiums are just too high for what you get in return. If you are change averse, merely switching from your current plans’ standard option to its basic option will give you essentially the same coverage, and save a ton of money in premiums.

In case you plan some last minute shopping over the weekend here are a few columns that may be helpful. They explain the number one reason you buy health insurance — its catastrophic coverage — and the danger feds face if they opt out of the Federal Employees Health Benefits Program for coverage under a spouse’s private sector health plan. Remember you can save $1,000 to $2,000 next year, maybe even have the plan pay you, just by picking the right plan for you

So what about the 94% who won’t change? Turns out some, maybe a lot of them, aren’t sleepwalking through open season. Turns out they know exactly what they are doing.  For example:

“Just wanted to drop a line to let you know that again this year I did due diligence and bought the Checkbook from Walt Francis, looked over the plans both medical and dental and came to the conclusion that I will stay in both plans I currently have. Every year you report out figures that only 3%-5% change plans. This gives the impression that those of us who have plans just sit on our duffs every year and don’t do anything.

“Well, a lot of us do check out the options, but determine that the plan we picked previously is still the best option. I have changed plans three times in the past 20 years, but every year I check out the available plans. Currently I have the CareFirst HDHP and even though I am 61 [years old] and retiring, it still looks to be the best for me. I don’t have that pesky Medicare decision to weigh into the equation for a few years yet.

“For dental I have Met Life High, which is one of the higher ones but there is not a huge difference in cost, but it has one of the higher [percent-to-cost] share for crowns and fillings and no deductible.  Some are lower, but I have had one of the others before and the dental practice went back and forth on a simple cost they should have paid for but would not, so that turned me off using them again. I have had no problem with Met Life covering what they say they cover.

“So you see there are many of us that check it out every year, but stay put because we checked it out every year and our previous decision still holds.” — Todd Smith, Gaithersburg, Md.

Nearly Useless Factoid

By Amelia Brust

Israel’s Ministry of Defense has a contract with manufacturers to supply as many nearly 400,000 sufganiyot (jelly donuts) including about 10,000 vegan versions, to troops for the Hanukkah season.

Source: The Jerusalem Post

Probably not.  Fun it isn’t. Comparing health plan brochures and discussing premiums, deductibles and the role of Medicare Part B in your life is hardly dinner table or cocktail party fare. And yet, picking right plan between now and close of business Dec. 9 may be the most important financial decision you will make this year. Or if you or someone in your family has a serious accident or medical condition it could be the most important choice you will ever make. Medical bills are the number one cause of bankruptcy in the U.S., but most of us don’t think about it when picking our health plan.

Thinking about a potentially catastrophic medical emergency is not pleasant — it’s awful. But stuff happens. Think of your friends, office mates, relatives or yourself — how did they, and you, do this year?

Walton Francis, editor of Consumers’ “Checkbook Guide to Health Plans for Federal Employees” says “the most important reason for buying health insurance is to protect you against financial catastrophe.” Because of that he suggests you may want to check out the “limit to you” column of Checkbook or its online version, which many agencies have purchased for employees. The limit to you includes both annual premiums you will pay regardless of what kind of health year you have in 2002, and the guarantee of the health plan for hospital, medical or prescription drugs. In other words it’s the financial limit you will have to pay in a worst-case scenario. That limit to you ranges from $4,000 to $5,000 in the Kaiser, Carefirst United HDHP; to as much as $9,000 to $10,000 for Aetna open access and SAMBA high option for a self-only plan. Naturally your out-of-pocket maximum will be higher if you have a family plan.

If you’re like many feds you’ve either decided to remain in the same plan for 2020, or will, maybe, shop over the weekend. Not such a great idea. Francis says as many as six out of 10 retirees and workers may be in the “wrong” plan — wrong in the sense that while it’s a good plan, you may be paying more than you need. So how do you know?

Bear in mind the primary reason you buy health insurance is its catastrophic coverage, or how much you would have to pay out of pocket in 2020 if you or a family member suffers a major medical problem or accident. Here’s a checklist of things you should consider, starting with your plan’s catastrophic coverage:

• Bankruptcy
• Length of time in the same plan
• An IRA
• New plans for 2020
• Is your doctor still in-network?

Nearly Useless Factoid

By Amelia Brust

Legendary lothario Giacomo Casanova escaped from a Venetian prison in 1755 where he was sentenced to five years for repeated adultery. While incarcerated in “the Leads” facility, named for the lead that coated its walls and roof, Casanova found an iron rod in the prison yard and fashioned it into a digging tool. For several months he worked on a tunnel out of his cell but he was suddenly forced to move to another cell. He gave his iron tool to the prisoner next to him, a monk named Balbi, who agreed to dig one tunnel joining their cells and the outside. They succeeded and split up once back in central Venice, avoiding police detection.

Source: PBS

If you’re like many active and retired feds you are still unsure which health plan to pick for the 2020 year. The deadline is Dec. 9, next Monday.

If you are like most people in the Federal Employee Health Benefits Program you’ll punt — again, do nothing. You will stick with the same plan you had this year, and last, and maybe even since you entered government or retired from your federal or postal job. That could be a big mistake that means you will pay thousands of dollars more in premiums next year than necessary, in some cases $10,000 or more.

But consider your options: The money you save, without losing any benefits or coverage, could be enough to buy you a new car next year — half a car, anyhow. Here’s the deal:

Federal-postal workers in New York City, Dayton, Ohio; San Francisco, Dallas-Ft. Worth, Little Rock, Arkansas; and the most rural areas have roughly 30 federal health plans and options to choose from.  That’s a lot. Feds in the Washington, D.C.-Baltimore area have 40 plans and options. Seven new fee-for-service plans and options joined the FEHBP program. And Uncle Sam will pay about two-thirds of the total premium for most plans, and even more for postal workers, thanks to their union contract.

But insurance, even with the big federal subsidy, is still expensive, especially if you pick the wrong plan. For a couple with self-plus-one coverage the premiums for employees or retirees range from $3,940 next year to as much as $17,280 for the most expensive plan — with a lot of choices in between.  The same spread applies whether you are in a self-only plan or you have a huge family.

So when in doubt and with the deadline fast-approaching the way to guarantee the best coverage is to check out and stick with one of the plans with the highest premiums. If it costs a lot, it’s gotta be good, right?  The good news is that many of the highest-premium plans are excellent. The bad news is they cost too much for what you get. In many cases you can get similar coverage with the plan’s basic option, which costs much less.

Or if you need to save money only look at the plans with the lowest premiums. What could possibly go wrong, right? What could go wrong is that if you have an unexpected condition or emergency — i.e. the reason people buy insurance in the first place — you might be out of pocket big-time with a low premium plan. Which is why you either gotta shop or maybe continue to shell out big bucks for nothing.

So low premium, good, high premium, better! Correct?

Wrong, says Walton Francis, editor of Consumers’ “Checkbook Guide to Health Plans for Federal Employees.” He will be my guest on today’s Your Turn radio show at 10 a.m. EST on www.federalnewsnetwork.com or 1500 AM in the Washington, D.C., area.

Picking a plan based on premiums alone is not the way to go, Francis says. Since you can’t know now what your 2020 medical issues and bills will be, “there is no way to know which plan will leave you with the lowest total costs. You have to gamble just as you do with any insurance.”

Francis says don’t pick a plan because it has the highest or lowest premiums. “A low premium may hide major coverage gaps. A high premium may simply reflect expensive enrollees — lots of older, less healthy retirees — rather than the plan with the best benefits. Some plans have both low premiums and excellent coverage.”

How do you know? A couple of ways: Check out today’s show; listen live on your computer or call 605-562-0264 to listen live from any phone. If you have questions for Walt, send them to me before showtime at mcausey@federalnewsnetwork.com.

It’s also possible your federal agency, union or professional group has subscribed to Checkbook’s online shopping service. That means you can check plans, benefits and in-house network providers either from home or at the office. To see if you’re on the lucky list, click here.

And listen today, it could save you lots of money! Maybe let you end the year with more in your account than you paid out in premiums?

Nearly Useless Factoid

By Amelia Brust

The story of Rudolph the Red-Nosed Reindeer was created in 1939 by Robert May, a copywriter for the Chicago-based Montgomery Ward company, who was asked to come up with a Christmas story they could give away in coloring booklet form to shoppers as a promotional gimmick. May was inspired by the tale of The Ugly Duckling and his own experience with bullying as a child. He went with the name Rudolph to be alliterative. He wrote the story in rhyming couplets and tested it out on his 4-year-old daughter, Barbara. Although at the time, a red nose was an image associated with drinking and drunkards, May convinced the bosses at Montgomery Ward with an illustrator’s sketchings of deer at the Lincoln Park Zoo.

Source: Snopes

You could be setting yourself up to working another five years so you can have the best health coverage for yourself and your nonfederal  spouse in retirement. That’s when many private-sector plans either fall apart or disappear, unlike the federal plans which treat young healthy workers and older, less healthy retirees the same.

But there is a catch.

You can’t be covered by any of the FEHBP plans unless you were enrolled in one — as in paying premiums — for the five years prior to retirement. It’s called — surprise, surprise — the five-year rule.  And many people never hear about it until it’s too late. Every year dozens, maybe hundreds of about-to-retire civil servants learn they will either have to work another five years, or retire with inferior health insurance.

You work for Uncle Sam. Government has been your career. Your spouse is in the private sector. Their health insurance is cheaper and better than any of the 20 to 30 plans available to you under the Federal Employee Health Benefits Program — or it’s more convenient. Whatever. In any case, you’ve piggybacked on the plan for years. But you realize that when you both retire you’ll have to switch to one of the FEHBP plans. They are better, less expensive and Uncle Sam pays most of the premium.

A no-brainer. So far, so good. Right?

For retirees, the FEHBP’s cradle-to-grave coverage with Uncle Sam paying up to 75% of the premium is the best deal around — anywhere. So what could possibly go wrong? The short answer is plenty, as in just about everything. How come?

If you ignore the five-year rule, you could wind up working for Uncle Sam a lot longer. I got a call earlier this week from a frantic fed. She’s been carried on her private-sector husband’s health plan for years. They like it and it worked for them — until now.

She happened to mention to a co-worker that she’s going to retire in December 2020. Her friend asked, “What about health insurance after you retire?” The woman answered, “What about it?” She would just switch to one of the FEHBP plans for herself and her husband. His insurance will cost more and cover less in retirement. It’s not the first time I have heard this, so what’s the problem?

Some feds, who use their spouses non-FEHBP plan, get around the five-year rule by enrolling in one of the less expensive federal plans. They pay minimal premiums but it guarantees that when they retire, after five years under the federal health program, they can continue it in retirement, when it counts most.

Here’s how benefits expert Tammy Flanagan explained the rule:

“Health benefits coverage can be continued into retirement for employees who retire on an immediate — not deferred — benefit and who have been enrolled continuously in the program for at least five years immediately preceding retirement, or for the entire period before retirement in which they would have been eligible for coverage if that period happens to be less than five years. An ‘immediate’ annuity under the Federal Employees Retirement System includes retirement under the minimum retirement age plus 10 years’ service provision, even if the annuity is postponed to a later date to lessen the age reduction. Health benefits, as well as life insurance coverage, in those situations are suspended until the annuity commences.

“Employees are considered covered if they are enrolled under a spouse’s federal health plan. Additionally, their coverage need not have been in the same plan. They may have always had a [Postal Service] mail handler’s benefit plan, but the open season before retirement switched to GEHA, or SAMBA, Aetna, Blue Cross [Blue Shield] or an HMO. They still are considered to have continuous coverage in the federal program. In some cases, coverage under CHAMPUS (the military health plan) may be creditable toward meeting the coverage test.

“The problem of not having five years’ continuous coverage mainly will affect those married employees who are covered under a spouse’s private-sector [plan.]

“Some employees are eligible for a waiver of the five-year rule due to a policy related to the buyout program. It states that employees retiring with a buyout can continue federal health coverage regardless of those restrictions so long as they were enrolled in a federal health plan (or as a family member) as of March 30, 1994. In addition, this policy covers those separating under early retirement without a buyout and those taking discontinued service retirement because of job abolishment, reduction-in-force, transfer of function outside the commuting area, etc.”

Nearly Useless Factoid

By Amelia Brust

When ancient Egyptians began brewing beer it was primarily done by women, as the drink was culturally considered more effeminate than wine. Through the medieval period in Europe, women remained the lead brewers for homes and small-scale commercial purposes. Not until the 15th century did the practice become more commercialized and, therefore, required more legal and financial resources available only to men that they displaced women as heads of the industry. Nevertheless, it was a 17th century German nun who discovered that adding hops to beer increased its shelf life.

Source: Vice

Health premiums can be hefty. Yet with all the choices in the Federal Employees Health Benefits Program there is no reason someone should pay more than necessary.

Consider the following: Premiums for a single person in the federal employee health benefits program can range from around $1,200 a year to more than $7,500. And that’s after the government pays its share, which is about two-thirds of the total premium.

A family of three next year will pay anywhere from $3080 to as much as $16,000. So it stands to reason that the most expensive plan is the best, right? Cadillac versus Chevy, right?

Wrong — while all of the plans in the FEHBP are good to excellent some simply cost too much. Many are top-heavy with older, less healthy workers and retirees. As their costs go up, so do premiums. The current health insurance open season ends Dec. 9. When it’s over only about 6% of those eligible for the program will have changed plans although Walton Francis, author of Consumers’ Checkbook “Guide To Health Plans for Federal Employees,” says 60% or more should probably change plans.

If wasting a couple thousand dollars next year is no big deal to you, you can skip this. But if you’d be interested in saving $1,000-$2,000 on your federal health plan in 2020, read on.

Francis, who literally wrote the book on the federal health program, said that many, many workers and retirees are paying too much because of the plan they are in. And with a little shopping they could save a bundle and still get excellent coverage.

The Federal Employee Health Benefits Program is considered the finest employer-provided health package in the country. Workers, retirees and their spouses and survivors are eligible for 20-30 plans. That includes national plans like Blue Cross Blue Shield, Aetna, GEHA, APWU and NALC as well as hundreds of local HMOs. People in the same plans pay the same premiums whether they are 22-year-old marathoners or 100-year-olds in assisted living. Nobody can be turned down because of age, sex, pre-existing conditions or personal lifestyle. The government pays anywhere from 70%-75% of the total premium for whichever plan you choose. If you approach your plan’s lifetime limit you can simply switch plans during the annual open season. This year that is Nov. 11 through Dec. 9.

So what are some signs that you may be paying more than you need to?

• Have you been in the same plan for five years or more?
• Have you been in the same plan since you joined the government, or retired?
• Do you get the most expensive high-option plan because it’s got to be the best?
• Do you have no idea what the catastrophic limit is in your plan?
• Do you have no clue what a catastrophic limit is, other than it doesn’t sound good?
• Are you unsure of how many other, maybe less expensive FEHBP plans include your favorite doctor in their network?
• Do you know the difference in drug coverage between different plans?

Many people in the private sector have the same problem but for different reasons. In many companies workers are offered just a few very limited plans. Their employer may pay a small portion of the premium, but not like the lion’s share Uncle Sam routinely picks up.

Many people use the old paralysis-by-analysis cop out. That is, there are simply too many choices, so they do nothing. But there are ways to narrow down your shopping list to just three or four plans — then shop, then save.

Nearly Useless Factoid

By Amelia Brust

In 1926, President Calvin Coolidge was sent a raccoon for his Thanksgiving meal by a Mississippi woman, with a note saying it would be a “toothsome flavor.” Coolidge chose to pardon it, but by then the uniquely North American animal had in fact been a common game meat eaten by Native Americans, then slaves and eventually by restaurant patrons and home cooks as far north as New York City and Maine.

Source: Atlas Obscura

Do a little home now — the health insurance hunting season ends Dec. 9 — and save thousands of dollars next year. The savings may come in the form of an IRA-on-steroids offered by some high deductible health plans (HDHPs), or from choosing a plan which will pay some or in many cases all of your Medicare Part B premium.

Walton Francis, editor of “Consumers’ Checkbook Guide to Health Plans for Federal Employees” says the IRA on steroids is available to workers who pick from one of several HDHPs or consumer-driven health care (CDHC) plans that will give you money each year to be used for medical services. Or, if not used, they can be rolled over into an account that earns interest. In some cases, he says, participants have built up five-figure accounts.

HDHPs, for example, offer two kinds of spending accounts: Health savings accounts which can grow in value — many people have $12,000-plus accounts, money you can keep even if you leave the plan; and health reimbursement arrangement plans (HRAs), which also offer accounts which terminate if you leave that plan. So how do they work and is one of them your best buy?

Knowing that the plans with the savings options exist is a first step. Don’t be wedded to your current, traditional plan just because you’ve been with it for years. Although it is torture for some, do some shopping. Start with the Checkbook Guide, either the online or print version which is available in many Washington, D.C.-area book stores and drugstores.

Also, check with your agency, union or professional association. Many have subscribed to the online version of Checkbook. Many agencies encourage workers to shop at the office because when workers pick lower premium plans the government, which pays two-thirds of the total premium, saves money. How do you know if your agency has subscribed for you? Click here for the list.

If not, you can actually pay for it yourself. Some items for your health plan checklist:

• Know the five-year rule: Be sure you are enrolled in one of the Federal Employees Health Benefits Program health plans for the  five years prior to retirement. Otherwise you and your spouse could be left without insurance in retirement, or you could be forced to delay retirement for five years.
• Know the difference between a fee-for-service plan and a local health maintenance organization. HMOs are great and generally have lower premiums. But if you want to go for treatment at the Mayo Clinic odds are they won’t pay.
• Couples should crunch the numbers to determine if two single plans or a self-plus-one plan is the better deal. Consider deductibles as well as premiums.
• If one partner is a working fed and the other a retired fed, who should pay the premium? Short answer — the working fed. Why? Taxes!
• Should you wait until retirement to put your private sector spouse on your FEHBP plan? If you die first and he or she aren’t covered by your plan they won’t be eligible for FEHBP.

Listen to our Your Turn radio show today at 10 a.m. EST, either by tuning into 1500 AM in the Washington, D.C. area or by listening live at www.federalnewsnetwork.com. Walton Francis is my guest and he’s got all the answers, including to questions you didn’t know should be asked about coverage for you and your family.

Feds in the Washington area have 40 bewildering plans and options to choose from. In other cities there are about 30 choices. Today’s  show was prerecorded so we won’t be taking questions.  But Walt will address the IRA-on-steroids issue and tell how you can find a plan that will let you buildup a cash nestegg while paying your Medicare Part B. premium in 2020.

Nearly Useless Factoid

By Amelia Brust

The hip bone is also called the “innominate bone,” meaning nameless bone. This is perhaps due to the fact that its shape is so irregular that ancient Greeks or Romans, when naming other parts of anatomy, failed to find another object that resembled it. By comparison, the tibia bone in the leg is named because it resembles a flute.

Source: NPR

It could be a year when out-of-pocket costs for a family of three ranges from $8,300 to more than $20,000, depending on which plan you are in when the worst happens. That out-of-pocket cost is out of your pocket!

And according to the man who wrote the book on the FEHBP health plans only about 6% of all feds, and even fewer retirees, switch plans each year when in fact 60% or more of you may be in the “wrong” plan. It’s not a bad plan, but it’s wrong for you in the sense of its premium are too high for what you might get in return.

First consider this point: All the FEHBP plans are good to excellent and the government will pay roughly two-thirds of the total premium. The problem is that with 30 fast-evolving health plan choices available to most feds — 40 in the metropolitan Washington, D.C., area — there are a lot of choices. And while you may be in an excellent plan, its premiums may be too high. There’s a good chance many if not most feds and retirees could get the same coverage with the same doctors in their network and save a couple of thousands dollars in premiums next year. That’s according to Walton Francis, long-time editor of Consumers’ Checkbook “Guide to Health Plans For Federal Employees.”

But with 30 to 40 choices of plans and options, where do you start? How do you know if you are probably paying too much in premiums, if you could save a lot of money simply by shifting from the Standard Option of your plan into its equally good Basic Option?

Take this simple test:

1. Are you still in the same plan you had when the impeachment proceedings began — Clinton, not Trump?
2. Did you last decide to shop, do you health plan homework and actually switch health plans during your favorite show “Mad Men,” or “Fresh Off The Boat,” or maybe even “The Leftovers” was your companion in 2015?
3. How many health plans, other than Blue Cross Blue Shield, Aetna, Kaiser or GEHA can you name? Remember there are 7 brand new plans this year. Do have a clue what they are called, how their premiums stack up, and how their premiums and their “catastrophic” coverage stack up?

For bare bones shopping Francis recommends choosing three plans, including your own, and compare premiums, catastrophic coverage (out-of-pocket to you), prescription drug benefits and whether your doctor will be in-network in 2020. You can go online on the Office of Personnel Management website, or check out Checkbook’s paper book guide ($10.95) at many D.C.-area drug stores.

Many people prefer Checkbook’s online version. You can buy it yourself but first check to see if your agency or union or professional association has done it for you. Workers at the departments of Labor, Education, and Health and Human Services can get it free at the office, as well as employees of the Congressional Budget Office, Environmental Protection Agency, Federal Energy Regulatory Commission, the Federal Reserve, OPM, Library of Congress, the U.S. Postal Service, members of the National Treasury Employees Union and the American Foreign Service Association — among many others.

To see if you get the perk free, at the office, click here.

Walt Francis will be our guest on this Wednesday’s episode of our Your Turn radio show.  He’ll run through the highlights of different plans, tell how you can pick a plan that will pay most of the premiums and give you an IRA on steroids, and explain why catastrophic coverage — which most people don’t like to think about — is actually the first thing you should think about.

Nearly Useless Factoid

By Amelia Brust

Gilroy Gardens Theme Park in California is home to the “circus trees” of Axel Erlandson, a Swedish-American farmer who developed a talent for growing mind-bending trees. Erlandson taught himself to cultivate and skillfully prune sycamores with complex inosculations, lattice-style tree trunks and other shapes.

Source: Wikipedia

Folks who do their health plan homework between now and Dec. 9 can in many cases save a couple thousand dollars in premiums next year — right off the bat. And/or they can get started with an “IRA on steroids” paid for by their health plan.

Many retirees can have their Medicare Part B premiums paid for them by their health plan. The trick is knowing which plans work best for you, and how your long-time plan, which has been great in every way, may have simply become too expensive.

Walton Francis, editor of Consumers’ Checkbook Guide to Health Plans for Federal Employees says the IRA on steroids is available to workers who pick from one of several plans high deductible heal plans (HDHPs) or consumer-driven health care (CDHC) plans that will give you money each year to be used for medical services or, if not used, can be rolled over into an account earns interest. In some cases, he says, participants have built up five-figure accounts.

HDHPs, for example, offer two kinds of spending accounts: Health savings accounts which can grow in value — many people have $12,000-plus accounts, money you can keep even if you leave the plan; and health reimbursement arrangement plans (HRAs), which also offer accounts which terminate if you leave that plan. So how do they work and is one of them your best buy?

Knowing that the plans with the savings options exist is a first step. Don’t be wedded to your current, traditional plan just because you’ve been with it for years. Although it is torture for some, do some shopping. Start with the Checkbook Guide, either the online or print version which is available in many Washington, D.C.-area book stores and drugstores.

Also, check with your agency, union or professional association. Many have subscribed to the online version of Checkbook. Many agencies encourage workers to shop at the office because when workers pick lower premium plans the government, which pays two-thirds of the total premium, saves money. How do you know if your agency has subscribed for you. Click here for the list.

If not, you can actually pay for it yourself. Some items for your health plan checklist:

• Know the five-year rule: Be sure you are enrolled in one of the Federal Employees Health Benefits Program health plans for the  five years prior to retirement. Otherwise you and your spouse could be left without insurance in retirement, or you could be forced to delay retirement for five years.
• Know the difference between a fee-for-service plan and a local health maintenance organization. HMOs are great and generally have lower premiums. But if you want to go for treatment at the Mayo Clinic odds are they won’t pay.
• Couples should crunch the numbers to determine if two single plans or a self-plus-one plan is the better deal. Consider deductibles as well as premiums.
• If one partner is a working fed and the other a retired fed, who should pay the premium? Short answer — the working fed. Why? Taxes!
• Should you wait until retirement to put your private sector spouse on your FEHBP plan? If you die first and he or she aren’t covered by your plan they won’t be eligible for FEHBP.

Listen to our Your Turn radio show today at 10 a.m. EST, either by tuning into 1500 AM in the Washington, D.C. area or by listening live at www.federalnewsnetwork.com. Walton Francis is my guest and he’s got all the answers, including to questions you didn’t know should be asked about coverage for you and your family.

Feds in the Washington area have 40 bewildering plans and options to choose from. In other cities there are about 30 choices. The show will be streaming live and then archived on our website so you can listen again, or listen later, or refer it to a friend. If you have questions for Walt Francis send them to me by showtime at mcausey@federalnewsnetwork.com

Nearly Useless Factoid

By Amelia Brust

Prague is known for its architecture and sculpture but one in particular frequently sparks calls to police. David Černý’s “Zavěšený muž” (“Man Hanging Out”) is a 7-feet-tall bronze sculpture of Sigmund Freud, hanging onto a rooftop pole over an alley. The piece represents Freud’s constant fear of death; the famed Austrian psychoanalyst died by euthanasia at age 83 while suffering from cancer. But from a distance many passerby have mistaken the sculpture for a person hanging themselves.

Source: Civic Arts Project

But it is buried among 30-40 options, serious shopping is required.

Welcome to the open season, also known, to some long-time civil servants and retirees, as Nightmare Alley. Between now and close-of-business Dec. 9 feds and retirees have a chance to pick a 2020 health plan at the lowest premium; whose network includes their favorite doctor(s); and which provides the best financial protection if they or a family member are hit with crippling medical bills next year for whatever reason.

And while picking the best plan for age, family status and medical needs, workers and retirees also have the chance to save $1,000 to $2,000 in premiums while getting the best possible medical care.  No brainer, correct? Yes, but shopping for health insurance, unless you had a very strange upbringing, is not fun. It isn’t rocket science, as they say, but it is difficult in part because people, regardless of age, health, preexisting conditions, family size, have so many choices.

In the Washington, D.C. metro area, which includes the Maryland and Virginia suburbs, many feds and retirees have 40 plans and options to choose from — 40! Imagine picking from 40 mutual funds, or lunch choices, except this is much, much more important. And you have about 21 days.

So, you can do nothing. That’s the route 96% of all health plan holders choose. You stay in the plan you’ve been in for years, decades, maybe forever. And that may have been a good plan back in the day. But today, and next year, your plan may be suffering what is known as “adverse selection,” meaning it is top-heavy with older workers and retirees who’s higher medical costs mean premiums have gone up dramatically. By shopping around you can probably find a similar plan that has lower premiums but gives you all the protection you need. At less cost to you.   In many cases you can stay in the same plan, like Blue Cross Blue Shield, but switch to a basic option where benefits are roughly the same and premiums are much lower.  And your doctor is in the same network.

But for whatever reason most people do nothing during the open season, year-after-year, even though insurance expert Walton Francis says many people — maybe 50% or more — are in a plan that is too costly for what they are paying. Or it doesn’t provide the catastrophic coverage protection they may need next year if they are a family member have a serious illness, accident or both.

So what if you could shop at the office, online, compare various health plans to check out premiums, catastrophic coverage and whether they may offer you money you can save for medical emergencies or invest on your own?  So many options, so little time!

And the good news is that a growing number of federal agencies have figured out that they too can save money — taxpayer money, actually — by subscribing to the online version of Walt Francis’ Consumers’ Checkbook Guide To Health Plans for Federal Employees. They pay for, and allow you to shop at work, conferring with your friends because a good deal for you is a good deal for the government, too, since in many cases Uncle Sam pays two-thirds of your total premium. So if you save money, your agency does too. Win-win.

So which agencies are offering it to employees? Here’s the list including means of access

Nearly Useless Factoid

By Amelia Brust

The record for the world’s largest brownie was given to Something Sweet Bake Shop in Daphne, Alabama, in 2013. It weighed 234.2 pounds and produced nearly 1,200 slices – which sold for $3 a piece to support the Bay Area Food Bank. McGill University in Canada attempted to beat that record a year later, with a more than 4,000-pound brownie. But it’s unclear whether Guinness World Records accepted that submission.

Sources: AL.com, Global News

When you combine the FEHB benefits with Medicare, the result is “an otherwise bizarre arrangement” with “massively wasteful extra spending” as Walton Francis states – giving his input on the subject.

That means some beneficiaries won’t find value in having both FEHB and Medicare coverage.

For most of the working class, Medicare Part A enrollment is automatic. Yet too many federal employees remain unclear and still have lingering questions about benefits.

So why should federal retirees enroll in Medicare if they have benefits through the FEHB program?

For some, coordinating these benefits together saves them money. However, this isn’t the case for everyone. Retirees want a clear understanding of the relationship between the FEHB Program and Medicare.

Do I Need Medicare with FEHB Coverage?

Once someone has Part A coverage, there’s no going back. Throughout the course of your working years, 1.45% of your income went to Medicare, then your employer matched that number. So if your paycheck paid into Medicare taxes, your employer also paid.

After turning 65, Medicare starts paying its part by covering your medical expenses. Once you have it, you’re stuck with it. Beneficiaries may not deny Medicare coverage.

Part A costs $422 per month for those who don’t earn it through their employer.

But since January 1, 1983, all federal employees have been paying payroll taxes for Part A coverage. That means coverage comes with a $0 monthly premium amount for these individuals.

Can Federal Employees Keep Their Health Insurance after Retirement?

Although unnecessary, retirees may choose to have benefits from both programs. Retiring and Medicare eligibility begin at age 65.

Once benefits begin, Medicare takes over as the primary insurance.

Primary insurance pays for services first, then secondary coverage “wraps up” the remainder. Working federal employees that don’t retire at 65 are still eligible for Medicare.

Certain retiring federal employees may want to consider joining Part B of Medicare.

For example, individuals with a fee-for-service plan, mail handlers or those with Government Employee Health Association (GEHA) plans may strongly consider Part B coverage.

Part B has a fee-for-service plan offering the most complete overall coverage for all medical expenses. Beneficiaries with both FEHB and Part B plans can expect very little out-of-pocket fees.

FEHB and Fee-for-Service Plans

One popular fee-for-service plan among adult Americans is Blue Cross Blue Shield (BCBS). In 2019, the company offers lower premiums for dental and vision plans than in the past.

BCBS has a governmentwide Service Benefit Plan known as the Federal Employee Program (FEP).

The program recently implemented a new coverage option for federal employees and retirees in the FEHB Program known as the FEP Blue Focus.

Is FEHB Better Than Medicare Part B

Federal retirees with HMO plans don’t need to join Part B. HMOs generally cover most medical services with small copayments at the time of each service.

The cost of seeing doctors outside of your HMO plan network can be financially taxing. For these retirees, joining Part B may be the better option because it covers costs for out-of-network services.

Traveling within the country is common for many, especially during retiring years. Individuals that travel may consider purchasing non-emergency coverage while out of town.

Part B will cover these costs, whereas FEHB generally includes emergency care when traveling outside the U.S. – plus dental and vision benefits.

For some, paying the Part B premium is worth the benefits.

How Does FEHB Work with Medicare

In the “Medicare and You” handbook, it’s suggested that FEHB coverage is comparable to Part B. However, retirees buying Part B must remember this isn’t supplemental insurance.

After enrollment, it takes over as the primary insurance and replaces FEHB coverage. Details about this can be found in Section 9 of the FEHB insurance booklet.

The FEHB then becomes the retiree’s supplement insurance (secondary to Medicare), though this provides few advantages in comparison to total spending amounts.

However, many may find the juice may not be worth the squeeze. In the end, most retirees gain little advantages altogether, making the additional premium for Part B coverage not worth it.

Part B premiums are income-based; some beneficiaries may find a significant decrease in their out-of-pocket risks.

If having both fits into your budget and benefits outweigh the potential risk, enrollment could make sense.

FEHB and Medicare Part C Enrollment

To enroll in Medicare Part C, you must enroll in Part A and B coverage. FEHB benefits are likely to continue.

Because Medicare Advantage Plans offer similar benefits to the FEHB program, for many, there’s no need to enroll in a Part C plan.

However, individuals may suspend their FEHB benefits if they choose to enroll in a Medicare Part C plan. Before the suspension of benefits, the retirement system requires beneficiaries to show their coverage documentation at the time of enrollment.

Life happens and some circumstances require the change or adjustment of benefits. Say a beneficiary loses or cancels their Part C policy; they may re-enroll in the FEHB program.

The reason why a person no longer has an Advantage Plan determines when they can re-enroll. Beneficiaries may re-apply for FEHB benefits for up to 60 days after the loss of an Advantage Plan.

This example is only for beneficiaries that lost a policy due to the plan leaving an area – or if a person moves out of their plan’s service area.

FEHB Re-Enrollment Period

On the other hand, simply canceling a plan for personal reasons may delay the re-enrollment process until the next Open Season.

The FEHB Open Season typically runs from Nov. 12 through Dec. 10 annually; benefits start Jan. 1 the following year. This is the re-enrollment period for otherwise ineligible beneficiaries.

Current federal employees have two new nationwide FEHB plans to consider this fall during the FEHB Open Season.

New FEHB plans are in place to assist members in achieving the most optimal health and improving their quality of life.

Do Federal Retirees Need Medicare Part D

Federal retirees needing prescription drug coverage often find themselves asking “is FEHB credible coverage? Can I postpone enrolling in Medicare Part D?”

The answer: yes! FEHB coverage is comparable to Medicare coverage. Therefore, beneficiaries in the federal program may delay joining a Part D plan; likewise, they’re exempt from any Part D late enrollment penalties.

The federal employee plans often include prescription drug benefits, although drug coverage may vary. Like any prescription drug plan, check for specific drugs within the plan’s formulary.

Part D likely pays primarily for prescriptions even with FEHB. Beneficiaries must continue to keep drug coverage from the FEHB program as its health and medication coverage may not be separate.

FEHB, Medicare and Retirement

All federal employees, currently working or retired, must look at their individual situation to determine if benefits should come from both FEHB and Medicare or just one.

All health and life circumstances are different. Health insurance benefits must reflect an individual’s specific medical needs.

Understanding how FEHB and Medicare coverage work together or separate is essential for optimal health insurance benefits and coverage.

Contact your local health insurance agent to help with any questions you may have about your benefits and any available options.

Jagger Esch is President & CEO of Elite Insurance Partners & MedicareFAQ.com.