Network News

X My Profile
View More Activity

Eye Opener: Workers Get Say on High Health Costs

By Ed O'Keefe



Lawmakers will consider whether promotional brochures like the one above misled current and former federal employees into thinking their long-term care premiums would not increase. (Courtesy Senate Special Committee on Aging)

Eye Opener

Happy Wednesday! (And Happy Birthday to Mrs. Eye!)

Current and former federal employees angered by premium increases in the Federal Long Term Care Insurance Program will get their day before Congress on Wednesday, when senators hope to get answers about why the impending price jump is warranted and what the government did to inform participants.


As The Eye reports in Wednesday's Federal Diary column
, marketing materials approved by the Office of Personnel Management led enrollees to believe that their premiums would not rise if they joined the program. In the months since they have learned otherwise, with some now expecting to pay as much as 25 percent more for premiums.

"This is exactly the opposite of the OPM I used to know," former Government Accountability Office employee Chester Joy said in an interview. He will testify Wednesday before a joint hearing of the Senate Special Committee on Aging and the Senate subcommittee on oversight of government management, the federal workforce, and the District of Columbia.

According to his prepared testimony, he will tell lawmakers that the marketing materials did not clearly state the possibility of a rate increase to enrollees who selected the Automatic Compound Inflation Option, or ACI. The option allows enrollees to pay more at a younger age and is designed to keep pace with annual inflation. A brochure that Joy plans to submit for the record mentions only possible premium increases in a section that describes a different payment plan.

According to his prepared remarks, Sen. Daniel K. Akaka (D-Hawaii), chairman of the subcommittee, is expected to say that the long-term care program "should serve as a model for the private sector and state and local governments. Right now, the program is falling short of this goal."

"Red flags have been raised concerning OPM's role as a regulator of this insurance program," according to Sen. Herb Kohl (D-Wis.), chairman of the Aging Committee. "We hope to hear that OPM has a plan for avoiding outrageous rate hikes in the future, and for providing better consumer education to its policyholders."

OPM spokesman Edmund Byrnes said Tuesday, "Given the experience with rate increases under the new contract, we are sensitive to how the message on premium increases is portrayed and have been working closely to ensure enrollees and future enrollees understand exposure to the possibility of future rate increases."

Leave your thoughts in the comments section below.

Are Government Workers Overpaid?: Track an ongoing debate that started here and continues here. (The Eye is steering clear of this one... at least for now!)

Cabinet and Staff News: President Obama and Transportation Secretary Ray LaHood tour the Fairfax County Parkway Extension project this afternoon. Labor Secretary Hilda Solis, Interior Secretary Ken Salazar and Supreme Court Justice Sonia Sotomayor attended last night's "White House Fiesta Latina Concert," which airs tonight on PBS. Former Interior Secretary Gale Norton subpoenaed. The pay czar once again tries to trim AIG bonuses. Some of Timothy Geithner's aides reaped millions of dollars from banks and hedge funds.

Census Chief Disputes Estimate on Hires With Criminal Pasts: The agency head said the bureau is trying to determine whether it is feasible to require a second security check on job candidates whose fingerprints cannot be read the first time they are run through the FBI database.

A Historic Success In Military Recruiting: For the first time in more than 35 years, the U.S. military has met all of its annual recruiting goals, as hundreds of thousands of young people have enlisted despite the near-certainty that they will go to war.

EPA Releases '07 Climate Document Rejected by Bush Team: The e-mail and the 28-page document attached to it show that the agency concluded in December 2007 that six gases linked to global warming pose dangers to public welfare, and wanted to take steps to regulate their release from automobiles and the burning of gasoline.

U.S.S. New York Sets Sail for the Big Apple: Built with tons of steel salvaged from the World Trade Center towers, the ship began its journey on Tuesday, sailing down the Mississippi River in a pea-soup fog as watchers along the levee strained for a glimpse.

Work on Your Bhutan. Shake Your Djibouti. Grab Some Togo, to Go: Yes, the CIA World Factbook for 2010 -- billed as "a country-by-country guide to the world at your fingertips!" -- is now available wherever books are sold.

The Pastor Who Has Obama's Attention: Seventy miles from Washington's prying eyes, Barack Obama has been attending church from time to time at Camp David, where services are led by a 39-year-old Navy chaplain with a famous last name, a compelling life story and a fervent belief in a God who works miracles. But don't make the mistake of referring to the imposing 6-foot-4 Southern Baptist chaplain as the president's pastor. The White House has said that's not the case.

FCC Chief Seeks Broad Open-Internet Rules: Chairman Julius Genachowski is proposing that the agency apply tougher open-Internet rules broadly, raising concerns of cable and phone companies and some lawmakers that the government could try to control efforts to offer products such as digital cable or premium business services.

Senators Try to Exclude Illegal Immigrants From 2010 Census: Proposed last week by Republican Sens. David Vitter of Louisiana and Bob Bennett of Utah, the amendment would exclude illegal immigrants from the population count used to allocate congressional seats after the 2010 Census. It also would require the Census to ask people whether they are citizens.

TSA Works to Reduce Attrition Among Top Staff: GAO found the agency has relied heavily on senior executives, and during its early years, shed those executives more quickly than other federal departments.

Follow The Federal Eye on Twitter | Submit your news tips here

By Ed O'Keefe  | October 14, 2009; 5:51 AM ET
Categories:  Eye Opener  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Census Chief Disputes Estimate on Hires With Criminal Pasts
Next: Mrs. Obama Resumes Federal Agency Tour

Comments

These are not specifically health cost concerns, they're insurance cost concerns. And the deal some people thought they were making so that others would pay their cost increases. Seems they find a way to get others to pay their costs, and now they're ticked off.
#1 - read the advertising and know what might happen
#2 - reason things out; if costs go up beyond estimates three things can happen: premiums will go up, someone else pays the increase (government? later enrollees?), or the company will fold.
People need to understand what insurance is, not what they want it to be. It's a pool of money where I pay your bills today in the expectation that you'll pay mine tomorrow, all managed by a firm that makes a profit investing that pool of money. Someone pays - who is it be?

Posted by: LoveIB | October 14, 2009 7:45 AM | Report abuse

I, too signed up for long term insurance when it was first offered, coincidentally when I was about to turn 55. I chose the ACI option, after reading all the literature and talking with agents, since it offered the best protection against premium increases - but it did not rule them out! This will be the first premium increase since the program started in 2001. Not a bad track record. Nothing in life is guaranteed folks. I'm not going to complain.

Posted by: sandynh | October 14, 2009 8:19 AM | Report abuse

What's unclear about "lock in a flat rate"? They set the rates and terms; I didn't. The inducement was that, in return for enrolling in the plan at a young age and initially paying higher premiums, the company would have those dollars to invest decades before any actuarial expectation that I would receive any benefit.

Posted by: KSVA | October 14, 2009 8:36 AM | Report abuse

The comments to this entry are closed.

 
 
RSS Feed
Subscribe to The Post

© 2010 The Washington Post Company