As the prospect of life without a paycheck sets in for 800,000 federal employees and others affected by the ongoing government shutdown, questions are arising about health insurance and other health benefits — dental and vision coverage, and long-term care insurance.
Will shuttered agencies continue to cover benefits for employees and contractors as per usual? We've dug up some answers.
Are federal workers and their families still covered by their health plan?
For the most part, federal employees needn't worry about that, according to the Office of Personnel Management, which has published an FAQ blog post on the topic.
Both the online FAQ and the health insurance industry's trade association confirm that coverage through the Federal Employees Health Benefits program will continue even if some federal agencies affected by the shutdown aren't issuing those paychecks and or paying the insurance premiums.
"The shutdown should not impact their coverage," says Kristine Grow, spokeswoman for America's Health Insurance Plans, the trade group that represents insurers, including those that offer coverage through the federal program. "It's business as usual."
Once the shutdown ends and those payments resume, workers should expect that their usual share of premiums plus the accumulated amount that wasn't deducted during the missed pay periods will be taken out.
"Procedures may vary somewhat by payroll office, but the maximum additional deduction allowed under regulations is one pay period's worth of premiums (in addition to the current pay period's premium)," says an OPM spokeswoman.
Does the same hold for contract workers?
Less clear is what will happen to workers under contract with the affected federal agencies — including some people working as analysts, administration assistants and janitorial staff — who are mostly excluded from the FEHB program.
Many firms that contract with the federal government offer their workers insurance. The federal Office of Personnel Management recommends these contracted employees consult the human resource office at their company for answers regarding the shutdown.
"In 95 percent of cases, even if it's not required by law, I would think most everyone would continue that coverage," says Rachel Greszler, a senior policy analyst and research fellow at the Heritage Foundation, who studies economics, budget and labor issues.
Contract workers who buy their own health coverage and are struggling to pay bills without their paychecks may have less recourse, beyond asking insurers for a grace period in paying premiums. But there is no requirement that insurers grant such a request.
"We are concerned about the disruption that this shutdown has caused our members and their families," notes a corporate statement from CareFirst BlueCross BlueShield — one of the insurers near Washington, D.C. "We are currently exploring how to best address this issue should the shutdown continue."
Beyond basic health insurance, what other health benefits could be affected?
Depending on how long the shutdown lasts, dental, vision and long-term care insurance programs may start sending bills directly to workers.
Federal workers pay the premiums for these benefits themselves, according to Dan Blair, who served as both acting director and deputy director of the OPM during the early 2000s. He is now a senior counselor and fellow the Bipartisan Policy Center in D.C.
Because workers' checks are not being processed, the amounts usually sent to these carriers each pay period also aren't being paid. If the shutdown lasts longer than two or three pay periods, workers will get bills for premiums directly from these firms and should pay them "on a timely basis to ensure continuation of coverage," the OPM says in its FAQ. Blair agrees.
There also may be a delay in processing claims for flexible spending accounts. These are special accounts in which workers use pretax money deducted from their paychecks to cover certain eligible medical expenses — such as eyeglasses, braces, copayments for doctor visits or medications, including some over-the-counter products.
With no paychecks going out, these deductions are not being made and transferred into FSAs. Once paychecks start up again, the amount deducted will be adjusted so the worker will get the annual total they had requested.
During the shutdown, though, reimbursement claims to these FSA accounts also won't be processed, the OPM says. Blair suggests holding off on big-ticket purchases during the shutdown, if possible, and to always keeping paperwork on the purchases.
Another consideration: People who switched health plans before a furlough may find their paperwork wasn't processed in time.
In those cases, the OPM says to stick with the old health plan until the shutdown ends and the new plan is processed. The new plan will pick up any claims incurred.
How will workers know if their change was processed? The OPM's FAQ says workers who receive an ID card in the mail are enrolled.
"The new policy will be what applies and pays benefits, but there could be some administrative burdens and hassles on the part of workers if the shutdown continues much longer, if the initial bills are not going to the right insurance company," Greszler says.
Overall, Blair says workers should continue to monitor news media sites — particularly those that focus on federal workers and issues — looking for any updates.
"We're getting into uncharted territory and there are always things that pop up that no one has planned for," says Blair, who did not face any shutdowns during his tenure at OPM.
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