FEHBP Used ‘Negotiations’ To Secure Lower Health Care Premium Increases For Federal Employees

The average increase in federal employees’ health insurance premiums for 2012 will be the lowest since 2008, the Office of Personnel Management announced today, spiking just 3.8 percent. That means that participants in the Federal Employee Health Benefits Program (FEHBP) — essentially an exchange of private insurers — will pay “less than half of the 7.3 percent increase in premiums for 2011.” OPM concluded that “[n]egotiations kept premium increases as low as possible without increasing the out of pocket costs, such as for deductibles, co-pays, and coinsurance.” Needless to say, the results may bode well for the Affordable Care Act’s exchanges, which are partly modeled on the FEHBP.