The bill — which the House passed in September — would expand the number of congressional employees and executive branch officials who won’t be eligible anymore for the Federal Employees Health Benefits program under the reform law starting in 2014. It would also get rid of the government’s employer contribution for that group of 18,000 federal employees, which would include all congressional office and committee staffs, the president, the vice president and certain political appointees.
The CBO found eliminating the government’s employer contribution for those federal workers would reduce outlays by roughly $2 billion from 2014 to 2023. However, sending those employees to the exchanges would mean the government would provide more subsidies to help cover the cost of health plans purchased through the exchanges. Overall, increased payments for premium subsidies and the increased cost-sharing subsidies would cost $530 million during the next decade, according to the CBO.
Additionally, the legislation would provide an incentive for federal employees to retire earlier so they could avoid losing access to employer contributions for health insurance, leading to a $61 million increase in federal retirement payments from 2014 to 2023.
Revenues would also go down by $340 million from 2014 to 2023, according to the CBO. The drop would occur partly because of the increased premium subsidy spending. Federal employees switching to their spouses’ employer-based coverage and workers who retire early, no longer making contributions toward future retirement benefits, would also lead to lower revenues.
For more information, read the full CBO report here.
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