It’s raining regulations

OPM published three proposed FEHBP rules in today’s Federal Register.

The most significant proposed rule pertains to the plan discontinuance process. Currently when a plan drops out of the FEHBP, its enrollees are given an opportunity to switch to a replacement plan. If an annuitant enrollee fails to make an election, the annuitant is auto enrolled in the Blue Cross Standard Option, the plan with the most members.  If an employed enrollee fails to make an election, the employee is out of the FEHBP until the next Open Season. Today’s proposed rule would extend the auto-enrollment protection to all enrollees and it would switch the default plan to the lowest cost nationwide plan selected annually by OPM. The default plan cannot be a high deductible plan or charge membership or association dues. As it stands today, the default plan would be GEHA Standard Option.

The other two rules address FEHBA preemption of state anti-subrogation laws and refining the pricing rules for community rated comprehensive medical rules or HMOs.  The preemption rule seeks to bring closure to an issue that has contested in court.  State anti-subrogation laws in the FEHBlog’s view (and the FEHBlog’s law firm runs a subrogation business) inequitably allow injured persons a double recovery from the health plan and the liable party’s auto insurer.  The FEHBlog is pleased that OPM agrees.

The third rule further rationalizes the pricing methodology used by community rated plans.  The change likely will make FEHBA participation more appealing to plans in states that mandate the use of traditional community rating.

The public comment period on the preemption rule expires on February 6, 2015. The public comment period on the other two rules ends on March 9, 2015.

On a separate note, has a first look on FEHBP related bills being introduced in the 114th Congress which opened for business yesterday.