Bill Proposed to Reduce Federal Worker Healthcare Costs

Federal workers could get some healthcare cost relief if a House bill proposed by a Massachusetts congressman becomes law.

Introduced in late April, the proposed law by Democratic U.S. Rep. Stephen F. Lynch claims it can reduce prescription drug and healthcare premium costs.

Simply, the bill would remove a “middleman” — namely, pharmacy benefit managers — in the prescription drug procurement process and grant more oversight and contracting authority to the U.S. Office of Personnel Management, according to FierceGovernment.

“While the purpose of contracting with (pharmacy benefit managers) was to control drug costs, there is little evidence this approach has been effective,” National Treasury Employees Union President Colleen Kelley said in the statement.

The union claims prescription drug costs are anywhere from 15 to 45 percent more costly for federal workers enrolled in the Federal Employees Health Benefits Program (FEHB) compared to Medicare and other federal healthcare systems operated by Veterans Affairs and the Pentagon.

According to Rep. Lynch’s bill, it would “ensure oversight and cost savings in the pricing and contracting of prescription drug benefits under the Federal Employees Health Benefits Program.”

The proposed law was referred to the House Committee on Oversight and Government Reform on April 30. If it can pass Congress and make it through the White House, it could represent a small victory for many federal workers who have been paying more out of their pockets for healthcare and other benefits.

While the cost of healthcare premiums for the federal workforce has stabilized in the past few years, they still continue to increase as we reported in a previous blog post.

For more information about FEHB, please visit our health insurance page.