Overview of the Federal Employees Health Benefits Program

Federal Employees Health Benefits Program (FEHBP) is a health insurance program for civilian federal employees and their families. While the insurance policies themselves are provided by private companies, they are regulated and partially funded by the federal government. Federal employees can choose from several different types of health plans that have their different structures and provide coverage in different ways. At the same time, the federal oversight ensures that the policies under the program remain affordable and that the terms remain largely fixed. Furthermore, unlike private insurance policies, preexisting conditions aren't an issue, making the program open to everyone regardless of health history.

Who Qualifies for FEHBP?

FEHBP is open to all American citizens who work for any civilian agency of the U.S. federal government. This includes everything from post office workers to member of U.S. Congress. The federal employees have to work full time to get all the benefits. Part-time or intermittent employees and temporary appointments can also qualify, but their qualification varies depending on the terms and nature of their employment. When a federal employee retires, he or she can choose to remain in the program. The benefits he or she would receive remain the same.

In addition to the federal employees themselves, FEHBP covers their spouses and unmarried children under 22 years of age. The age requirement is waved for children who are medically incapable of supporting themselves. Stepchildren and foster children qualify if they live with their parents and if a federally employed parent is actively involved in their upbringing.

If the federal employee dies and leaves behind a retired spouse, the spouse retains his or her coverage so long as he or she was enrolled in any FEHBR insurance plan for no less than five years in a row prior to retirement.

FEHBP Enrollment Options

Federal employees can choose from several different plans. The plans vary depending on where they work and what position they hold. All of those plans fall into one of the following categories:

  • Fee-for-Service Plans--plans by which the insurance provider will either pay to the employee's medical service provider directly or reimburse the employee after he or she pays for the services out of pocket.
  • Fee-for-Service Plans with a Preferred Provider Organization--similar to above, except the medical costs get reduced if the employee gets medical care with a preferred provider organization, a medical service provider that has an agreement with the insurance company.
  • Health Maintenance Organization plans--plans by which insurance companies cover the costs if the employee gets care from the insurance company-approved network of local hospitals and physicians.
  • Consumer-Driven Health Plans--any plan whereby employees get some choice when it comes to where they can be treated and how much it will cost. This is one of the more expensive options.
  • High-Deductible Health Plan--plans in which the employees have to pay higher deductibles compared to other types of plans. In return, their annual out-of-pocket contributions are reduced. Their deductibles are somewhat reduced if they stay within the plan's health care provider network. The employees don't have to pay deductibles for preventive care.

What FEHBP Plans Have in Common

While each plan has its own features, the federal supervision ensures that all plans include the following features:

  • Accessability--The plans don't have waiting periods, and they don't take preexisting conditions, ensuring that the insurance coverage kicks in promptly and extends to all qualified federal employees.
  • Continuity--The coverage continues for as long as the enrollee is employed. Each year, employees can switch to a different plan, but if they do nothing, they automatically retain coverage under the current plan.
  • Flexibility--As mentioned above, employees can switch at the end of each year for any reason whatsover to any plan that provides coverage in their area.
  • Stability--The insurance companies can change premiums once a year, and they have to stay below federal limits.
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