Federal Employee Health Benefits (FEHB) – Personalizing your Options

Federal Employee Health Benefits (FEHB) – Personalizing your Options

Federal employee benefits include a wealth of choices in insurance plans. Rather than the one or two choices offered in the private sector, federal insurance programs allow you enough choices to tailor the plans to meet your family’s needs. Knowing which benefit plan is best for your family allows you to make the most of this valuable benefit.

The Federal Employees Health Benefits (FEHB) Program is one of the most valuable portions of your total compensation package. Since enrollment is not automatic, you must choose your plan within 60 days from the start of employment. If you do not choose a plan, coverage is considered to be declined, and you must wait until the next open season, normally in late November/early December to enroll or change your Federal employee benefits plan.

The Federal employee benefits plans available vary by state, with national plans available as well. The types of health insurance benefit plans are:

Fee for Service (FFS)

Fee for Service plans are available with two choices. The first, the non Preferred Provider Organization (non-PPO) can be more expensive and require more paperwork, but allows you more choices in choosing a doctor. It is usually chosen by families who want to stick with their current doctor who may not be a Preferred Provider. This option also tends to not cover as many preventative medical services as other Federal employee benefits plans.

Fee for Service plans with Preferred Provider Organizations use medical providers who reduce their charges to that particular benefit plan. This option allows you to pay less out of pocket expenses and the claims process is much less cumbersome, with most paperwork handled by the provider.

Health Maintenance Organizations (HMO)

When HMO’s became widely used a few decades ago, they were touted as being inexpensive, but patients found these benefit plans to be restrictive and limited. HMO’s have improved, and the cost is normally less than other Federal employee benefits insurance plans, but identify your plan’s benefit coverage and your family’s needs before you enroll.

With an HMO, you will be expected to choose a primary care physician from a list provided to you by your insurance company. This is the doctor you will be required to see first; he or she then refers you to a specialist from the network if necessary. While this can be an affordable choice for someone who is young and in good health, it is important to remember that a Preferred Provider Organization (PPO) plan will provide you with more options than an HMO. There are some limits to the types of treatments that will be approved by an HMO provider, and it can take longer for referrals to come through.

Some HMO’s do have what is called a Point of Service (POS) option, which allows you to see doctors and use services that are not part of the HMO benefit network. You will have to pay more, much more, for seeing these providers, and you typically will need to file paperwork for the claim.

Preferred Provider Organizations

Typically, a PPO gives subscribers the opportunity to choose from a wide range of general physicians and specialists. Members of a Preferred Provider Organization are able to choose their primary care physician and other doctors from a fairly wide selection.
PPO members do not generally have to worry about referrals in order to receive care from in-network specialists, one of the biggest benefits to these insurance plans. PPOs are more costly than HMOs because of the better benefits they provide.

Consumer Driven Health Plans (CDHP)

CDHP’s are relative newcomers to the health insurance benefit industry. They are ‘high deductable’ plans and they are normally linked to some type of Health Savings Account (HSA). They allow you to visit any provider, both in and out of network, and you are given Medical and Dental Funds to help pay for services that are covered under your benefit plan. You pay nothing for covered services until you use up the funds. The theory behind these benefit plans is that you are given more ‘purchasing power’ for your money. No referrals are needed, premiums are low and benefit coverage is nationwide. CDHP’s are generally recommended only for users who:

      – Are generally very healthy;
      – Primarily use preventive care from their health benefit plan; and
      – Do not have ongoing major medical needs and/or use many prescription medications.

The Bottom Line on Federal Health Insurance Benefit Plans

There are so many to choose from, and that’s great in the long run – but make sure you thoroughly research each benefit plan available both in your area and nationwide. While you are able to change benefit plans annually during open season, getting stuck in the wrong insurance plan can be a costly mistake.

Back to Benefits Page