Thousands of federal retirees who thought that this month they would move into health insurance plans offering better coverage or lower premiums may be forced to stay with their current insurance plan for the remainder of this year.
Premiums in the federal employe health benefits (FEHB) program jumped an average of 30 percent in January. Many plans raised deductibles and cut benefits.
Because of the dramatic changes in the FEHB program, several hundred-thousand workers and retirees took advantage of the May "open season" enrollment period, switching to better and/or cheaper plans. Coverage for retirees who switched was to begin July 1. Coverage for most workers started in mid-July.
The FEHB covers 9.2 million federal workers, family members and retirees, including about half the population of metro Washington.
Changes made by current federal and postal workers have gone smoothly. But many retirees will soon be getting "rejection" letters from the health plans they thought they joined, saying they must remain in their present plan and keep paying its premiums and getting its benefits.
The problem stems from the fact that some of the union-backed plans -- which this year offered some of the most attractive insurance deals -- do not take annuitants unless they were members of the sponsoring union when they retired.
Most federal and postal union plans take active-duty workers if they pay an "associate member" fee similar to union dues.
Prior to the May open season, most of the 1.7 million retirees were covered by either Blue Cross-Blue Shield or Aetna. But many of them -- final numbers aren't available yet -- decided to switch to union-backed plans during the open season, unaware that they had to be union members to join.
One plan, offered by the Mail Handlers Union, said it would take nonmember retirees who have signed up--even though its brochures this year noted otherwise--if the Office of Personnel Management will allow it. Otherwise, health plan director James LaPenta says, it will have to reject hundreds of nonmember annuitants who want the union's coverage.
Most health plans would prefer not to insure annuitants, who are "heavy users" of health care. That's why union-backed health plans typically limit coverage for retirees to former members.
An OPM spokesman said that retirees who switched insurance plans but are ineligible for those plans will continue to be covered by their current plan, even though they technically dropped it effective June 30. They will continue to pay premiums to their current (pre-open season) health carrier.
There will be another open season at the end of this year, when workers and retirees will have a chance to pick health insurance coverage for the 1983 year. It is possible that the rules will be changed to require unions that now bar nonmember annuitants to take retirees in 1983, but that is yet to be decided.
For now, if you are a retiree who switched to one of the union plans limited to annuitant members only, you will remain in your present health plan until the end of 1982.