SUPPLEMENTARY INFORMATION:

Background

The FEHB Program was established in 1960 and is the largest employer-sponsored health insurance program in the United States. There are approximately 8.3 million covered individuals in the FEHB Program. Covered individuals include employees of the federal government, annuitants, covered family members, former spouses, and statutorily eligible groups enumerated in 5 U.S.C. 8901; and tribal employees of tribal employers, pursuant to 25 U.S.C. 1647b. Postal Service employees, Postal Service annuitants, and their family members are eligible for health benefits under the PSHB Program pursuant to 5 U.S.C. 8903c.

OPM administers the FEHB Program in accordance with Title 5 Chapter 89, United States Code and implementing regulations (5 CFR parts 890 and 892 and 48 CFR chapter 16). Under 5 U.S.C. 8913 OPM may prescribe regulations necessary to carry out administration of the FEHB Program.

OPM contracts with Carriers who provide health benefits plans in the FEHB Program, including the PSHB Program. For Plan Year 2026, there are 132 plan options from 47 Carriers in the FEHB Program and 75 plan options from 17 Carriers in the PSHB Program. Health benefits plans are limited to offering three options or two options and a HDHP pursuant to 5 CFR 890.201(b)(3)(i). When considering whether to allow health benefits plans to offer more, fewer, or different options, OPM is publishing this RFI and seeking public comment on the effect on premiums and health care costs, the consumer experience and the impact on operational practices.

As OPM explores ways to manage premium growth, it wishes to collect information from key stakeholders that support the FY 2026-2027 Annual Performance Plan's Strategic Objective 2.3 which seeks to “[e]stablish and apply evidence-based criteria to assess the appropriate number and distribution of health plan options available to enrollees.”

OPM has used rulemaking on health benefits plan options offered in the past. In 2010,^[1] OPM made changes to 5 CFR 890.201 to “allow eligible FEHB plans to offer three options, without the requirement that one of the options be a high deductible health plan.” Previously, the regulation stated, “FEHB plans shall not have more than two options and a high deductible health plan.” These changes applied to employee organization plans and health maintenance organizations (HMOs) described in 5 U.S.C. 8904(3) and (4), respectively. Then, in 2018,^[2] OPM made additional modifications that “revised the regulations so all health benefits plans are able to offer three options or two options and a high deductible health plan,” expanding the 2010 rule to the Service Benefit Plan described in 5 U.S.C. 8903(1) and the Indemnity Benefit Plan described in 5 U.S.C. 8903(2).

Questions

OPM recognizes the importance of maintaining affordable health coverage while continuing to provide value to those enrolled. Modifying the number or types of health plan options in the FEHB Program is a measure that may help to address growing costs. OPM seeks input on how this can influence cost savings.

• For enrollees, how might more, fewer, or different health benefits plan options offered lessen the cost burdens or mitigate premium increases?
• Would enrollees like to have more, fewer, or different health benefits plan options offered to choose from?
• Would a wider variety of options drive enrollees to select plan options with lower premiums?
• Plan options with lower premiums may involve higher deductibles and how can enrollees be best informed about their cost sharing when making a health plan selection?
• Should there be a threshold or upper limit to what a plan may charge for premiums and if that limit is exceeded should the plan be required to eliminate the plan offering if the premiums are not reduced?
• For the government, how might more, fewer, or different health benefits plan options offered lessen cost burdens and mitigate increases to the government contribution?
• If more plan options offered are HDHPs with health savings accounts allowing for enrollees to pay for care on a pre-tax basis, what impact would it have on enrollees and the government?
• What cost implications would be borne by FEHB Program Carriers if more, fewer, or different plan options are offered?
• Are there other cost implications for OPM to consider?

Enrollee satisfaction in the FEHB Program remains high. The 2023 Federal Employee Benefits Survey (FEBS) reported 90% of respondents considered the FEHB Program availability as “extremely important/important” and 94% of respondents believed it “meets needs to a great or moderate extent” however only 66% of respondents considered it an “excellent or good value.” OPM seeks input on how more, fewer, or different health benefits plan options offered can impact the FEHB consumer experience.

• What are the advantages or disadvantages of offering more choices in the FEHB Program?
• Are there particular types of plan options that would be more advantageous or desired to the FEHB Program population?
• Would more, fewer, or different plan options have an impact on the health status of the FEHB Program population? For example, might an enrollee expedite or delay care based on the plan type and associated cost sharing?
• If the plan options offered are HDHPs, would it encourage enrollees to shop around for lower cost medical care?
• What consumer support changes would FEHB Program Carriers need to make if more, fewer, or different plan options were offered?
• Would changes to the health benefits plan options offered impact employees and annuitants differently?
• Are there additional consumer experience implications for OPM to consider?

OPM is the administrator of the FEHB Program and contracts with Carriers that offer health benefits plans. In addition, OPM relies on a network of professionals throughout the federal government tasked with supporting enrollees with enrollment and other key operational aspects of the FEHB Program. OPM seeks input on how more, fewer or different health benefits plan options offered can impact operational and business practices. ( printed page 58390)

• Would offering more health plan options provide relief for existing plans facing detrimental adverse selection?
• How would more, fewer or different plan options affect current agency benefit officer (ABO) and human resource specialist training and knowledge and employee coaching or support practices?
• Are the currently available search tools and plan compare technology in the FEHB Program sufficient to support more, fewer or different plan option offerings?
• Are currently used payroll and human resource systems sufficient to support more, fewer, or different plan option offerings?
• What operational impacts would FEHB Carriers face if more, fewer or different plan options were offered?
• What types of contracting arrangements and incentives can be utilized to optimize plan options offerings and value?
• Are there other operational implications for OPM to consider?

91 FR 58388