Federal Insurance: Who's Covered?

In the United States, health insurance is not federally mandated for adults, however, it is crucial for financial security and access to essential medical care. While there is no federal requirement, certain states have implemented their own mandates, requiring residents to purchase health insurance or face penalties. Federal employees, on the other hand, have access to the Federal Employees Health Benefits (FEHB) Program, which offers a range of health plans to meet their healthcare needs. This program allows federal employees and their families to choose from various options, including Consumer-Driven and High Deductible plans, with the widest selection of health plans in the country.

Federal Employees Health Benefits (FEHB) Program

The Federal Employees Health Benefits (FEHB) Program is a US Government initiative that helps federal employees, retirees, and their survivors meet their healthcare needs. The program offers the widest selection of health plans in the country, including Consumer-Driven and High Deductible plans with catastrophic risk protection, health savings/reimbursable accounts, and lower premiums. There are also Fee-for-Service (FFS) plans, Preferred Provider Organizations (PPO), and Health Maintenance Organizations (HMO) available to those living or working within the serviced area.

The FEHB program allows users to compare the costs, benefits, and features of different plans. The FEHB plan brochures detail the services and supplies covered, as well as the level of coverage. These brochures can be obtained from the health plans or the user's human resource office. It is recommended that users carefully review the brochures and consider the total benefit package, service and cost, and provider availability when choosing a health plan.

The FEHB program also provides continued benefits during emergencies. This includes relaxing certain requirements, such as pre-certification and notification, to ensure uninterrupted access to medical providers. FEHB members are also not prohibited from participating in pharmacy-sponsored incentive programs or pharmaceutical company co-pay reimbursement programs.

Eligibility for the FEHB program is generally extended to federal employees and employees of certain tribes, tribal organizations, or Urban Indian organizations. However, there may be exclusions based on specific positions as outlined by law or regulation. Federal agencies or tribal employers determine eligibility, and there are special provisions for those in part-time, temporary, seasonal, or intermittent positions.

Health insurance not mandatory at the federal level for adults

Health insurance is not mandatory at the federal level for adults in the United States. Since 2019, there has been no federal penalty for citizens without health insurance. This means that, while the Affordable Care Act (ACA) of 2010, also known as Obamacare, made health insurance coverage mandatory, the individual mandate penalty was repealed by Congress in 2017 and came into effect in 2019.

Despite this, some states have imposed rules that require citizens to have health insurance. These include Washington, D.C., California, Massachusetts, New Jersey, Rhode Island, and Vermont. These states require residents to purchase health insurance or pay a tax penalty. Other states, such as Connecticut, Hawaii, and Washington, have also attempted to pass similar legislation.

The individual mandate was initially implemented to protect against "adverse selection" in the insurance market. Without it, a high percentage of those enrolling in health insurance plans are those who will utilise a lot of healthcare services, such as the elderly and people with existing health conditions. As these individuals are expensive to insure, insurance companies would often deny health benefits to those with pre-existing conditions or charge higher premiums based on age and medical history. The ACA made it illegal for insurance companies to deny coverage based on pre-existing conditions and used the individual mandate to ensure that healthy people also purchased health insurance, allowing insurance companies to lower premiums for all.

While there is no longer a federal mandate for health insurance, it is still important to have health insurance to protect against unexpected illnesses or accidents. Even a minor health issue can result in significant financial setbacks. Additionally, most health insurance plans provide access to preventative services, such as screenings and check-ups, which are essential for maintaining long-term health.

The Affordable Care Act (ACA)

• To provide consumers with subsidies (the "premium tax credit") that lower costs for households with incomes between 100% and 400% of the federal poverty level.
• To expand Medicaid to cover all adults with income below 138% of the federal poverty level.
• To support innovative medical care delivery methods designed to lower the costs of health care.

The ACA's major provisions came into force in 2014, and by 2016, the uninsured share of the population had roughly halved, with an additional 20 to 24 million people covered. The law also enacted a host of delivery system reforms intended to constrain healthcare costs and improve quality. After the ACA went into effect, increases in overall healthcare spending slowed, including premiums for employer-based insurance plans.

The ACA amended the Public Health Service Act of 1944 and inserted new provisions on affordable care into Title 42 of the United States Code. The individual insurance market was overhauled, and many of the law's regulations applied specifically to this market. Insurers were made to accept all applicants without charging based on pre-existing conditions or demographic status (except age). The ACA also established four tiers of coverage: bronze, silver, gold, and platinum, which vary in their division of premiums and out-of-pocket costs.

In addition to expanding access to health insurance, the ACA also includes provisions to improve the quality and reduce the cost of healthcare. These include Medicare payment changes to discourage hospital-acquired conditions and readmissions, bundled payment initiatives, the Center for Medicare and Medicaid Innovation, and accountable care organizations. The ACA has been subject to strong political opposition, legal challenges, and calls for repeal, but it has also gained majority support and been upheld by the Supreme Court on multiple occasions.

Federal Employees Dental and Vision Insurance Program (FEDVIP)

The Federal Employees Dental and Vision Insurance Program (FEDVIP) is a voluntary program that offers supplemental dental and vision coverage to eligible federal employees, retirees, and their dependents. FEDVIP is available to both current and retired federal and U.S. Postal Service (USPS) employees, annuitants, survivor annuitants, and certain retired uniformed service members, active-duty family members, and survivors.

The program was established by the Federal Employee Dental and Vision Benefits Enhancement Act of 2004, which authorized the U.S. Office of Personnel Management (OPM) to arrange dental and vision benefits for federal employees, retirees, and their dependents. FEDVIP allows participants to purchase dental and vision insurance on a group basis, resulting in competitive premiums and no pre-existing condition limitations for enrollment. This means that enrollees can enjoy competitive rates and enrol regardless of any pre-existing dental or vision issues.

Eligible individuals can choose from three enrollment types: Self Only, Self Plus One, or Self and Family coverage. For family coverage, eligible family members include a spouse and unmarried dependent children under specific age requirements. Stepchildren and foster children who live with the enrollee in a regular parent-child relationship are also included. In certain circumstances, coverage can be continued for a child aged 22 or older who is incapable of self-support.

Enrollment in FEDVIP takes place annually during the Federal Benefits Open Season in November and December. New and newly eligible employees have 60 days from the date they become eligible to enroll. Eligible employees and annuitants can choose from several nationwide and regional dental and vision plans, with the option to select a carrier that suits their needs. Nationwide plans also offer international coverage. It is important to note that employees must be eligible for the Federal Employees Health Benefits Program (FEHB) to enroll in FEDVIP, but actual enrollment in FEHB is not mandatory.

Federal Employees' Group Life Insurance (FEGLI) Program

The Federal Employees Group Life Insurance (FEGLI) Program was established in 1954 and is the largest group life insurance program in the world, covering over 4 million federal employees, retirees, and their family members. FEGLI provides group term life insurance, which means it does not build up any cash value or paid-up value.

Most federal employees are eligible for FEGLI coverage and are automatically enrolled in the Basic insurance plan. The Basic insurance coverage is equal to the employee's annual rate of pay rounded up to the nearest whole $1,000 plus $2,000. The cost of Basic insurance is shared between the employee and the government, with the employee paying 2/3 of the total cost and the government paying 1/3.

In addition to the Basic plan, there are three forms of Optional insurance that employees can elect: Option A-Standard, Option B-Additional, and Option C-Family. Option A provides an additional $10,000 of coverage on the employee's life, while Option B provides one to five multiples of the employee's salary as additional coverage. Option C provides coverage for the employee's eligible family members, with each multiple providing $5,000 of coverage on the spouse and $2,500 on each eligible child. Eligible children are typically defined as unmarried dependent children under the age of 22.

Unlike Basic insurance, enrollment in Optional insurance is not automatic, and employees must take action to elect these options. Employees must also have Basic insurance in order to elect any of the Optional plans. The cost of Optional insurance is paid in full by the employee and depends on their age.

Frequently asked questions