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News Release

FOR IMMEDIATE RELEASE
Tuesday, September 19, 2006
Contact: Michael Orenstein
Tel: 202-606-2402

OPM Announces 1.8 Percent FEHBP Premium Increase for 2007; Marks Fifth Consecutive Year of Declining Rate Hikes

Details Released on the Inaugural Dental and Vision Benefits Program

Washington, D.C.  --  The U.S. Office of Personnel Management today announced premiums in the 2007 Federal Employees Health Benefits Program will rise an average 1.8 percent, marking the smallest rate increase in more than a decade. OPM also announced the availability of additional Federal Employees Health Benefits Program (FEHBP) options and providers, as well as the new Federal Employees Dental and Vision Insurance Program (FEDVIP), which is available for the first time to eligible federal employees and retirees.

Approximately 63 percent of FEHBP enrollees will not have a premium increase in 2007; another 15 percent will see a premium increase of less than 5 percent. The 2007 rate increase of 1.8 percent continues a trend of five consecutive years of declining average premium hikes. On average, employees will contribute 2.3 percent more to their health care, while the government contribution (roughly 72 percent) will increase by 1.6 percent. In 2002, the average premium increase was 13.3 percent; in 2006, the increase was 6.6 percent.

Premiums in the Blue Cross and Blue Shield Service Benefit Plan will decline by up to $1.29 per bi-weekly pay period, or stay the same, depending on the enrollment option. Blue Cross and Blue Shield has more than 56 percent of FEHBP enrollments.

"The low premium increase can be credited to OPM's continuing efforts to provide federal employees and retirees with choices for top-quality health care at the most affordable price," said OPM Director Linda M. Springer. "The addition of dental and vision insurance to our package of workplace benefits provides a much-needed component that has been missing from the program."

For the 2007 plan year, OPM is recognizing 18 plans which have responded to a Bush Administration initiative to have greater transparency by making provider prices

available to their enrollees. Three plans are being highlighted for their initiatives in making personal health information, including medical, lab and prescription drug histories, available to their enrollees. Employees can use this health-information technology to make better-informed decisions in selecting their health-care plan. OPM will recognize additional plans as they meet the criteria for the transparency and health-information technology initiatives.

The FEHBP provides a range of quality health-care options, including cost-conscious consumer-driven plans linked to Health Savings Accounts (HSA), covering 8 million federal employees, retirees and their dependents.

The FEHBP will offer 284 plan choices in 2007, up from 279 in 2006; 29 HDHPs will be offered, an increase of two over 2006. Similarly, the number of Health Maintenance Organizations increases to 209, up from 205.

The dental/vision product, authorized by the Federal Employee Dental and Vision Benefits Enhancement Act of 2004, rounds-out a package of health care-related workplace benefits available to current and retired public servants. In recent years, FEHBP additions have included Consumer-Driven Options and High Deductible Health Plans (HDHP) linked to HSAs; non-FEHBP health-related benefits include Long Term Care Insurance and Flexible Spending Accounts (FSA).

Coverage under the highly anticipated FEDVIP begins December 31, 2006. Seven carriers will offer dental benefits; three carriers will offer vision benefits. Coverage and benefits vary, but generally include preventive-care services, oral and eye exams, orthodontia, and a variety of eye- and oral-care products and procedures.

Three enrollment categories are available for dental and vision coverage: self only, self plus one, and self and family. Bi-weekly dental premiums, based on the employee's place of residence, range from $7.29 for self coverage, to $56.77 for self and family coverage; bi-weekly vision premiums range from $2.63 for self coverage, to $16.21 for self and family coverage.

Enrollees pay the full premium for dental and vision coverage, with no government contribution. Enrollment in the FEHBP is not a prerequisite for obtaining dental or vision coverage; however, to obtain this coverage, employees must be "eligible" to enroll in the FEHBP. Annuitants need only have retired on an immediate (not deferred) annuity. Individuals may elect dental coverage, vision coverage, or both.

A single Open Season for the FEHB Program, FSAFEDS Program and Dental/Vision coverage will be held governmentwide from November 13 through December 11. During this period, individuals can review printed and online materials to compare the coverage and costs of each program, as well as enroll or make changes based on their personal needs. Current FSAFEDS enrollees must re-enroll for 2007 if they wish to continue coverage. Additional information on FEDVIP benefits and costs, along with health plan brochures, will be available at agencies for review by employees; employees and retirees can view the information online at www.opm.gov/insure/health/index.asp. Information on FEDVIP can be obtained online at www.opm.gov/insure/dentalvision; information on FSAFEDS can be found at www.fsafeds.com.

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Our mission is to Recruit, Retain and Honor a World-Class Workforce to Serve the American People. OPM supports U.S. agencies with personnel services and policy leadership including staffing tools, guidance on labor-management relations and programs to improve work force performance.


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