Federal Employees Health Benefits Program

Publication Date: October 1997

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Government

Type:

Abstract:

The Federal Employees’ Health Benefits Program (FEHBP) is a health insurance program for federal employees, annuitants, and their dependents. In 1997, about 9 million people participate in 374 FEHBP plans nationwide. On average, the federal government pays 71% of the cost of FEHBP premiums; participants pay the remaining 29%. The formula determining the government’s share of health insurance premiums and the enrollees’ share was to expire at the end of 1998, which, many believe, would have resulted in an average increase of about 23% in enrollee premiums and a concomitant reduction in the government share. However, the Balanced Budget Act of 1997 (P.L. 105-33) established a new formula that permanently sets the government’s share of premiums at 72% of the average total premium cost of all plans in the FEHBP, weighted by the number of participants in each plan. The government share cannot exceed 75% of the premium of any particular plan.