President Obama’s budget proposes that health plans covering federal and postal workers offer a third option: Self plus one coverage.

So when would it happen, and how would it work?

Chained CPI could cost feds thousands over time, NARFE says

Many federal employees and retirees have expressed concern over the impact of the Affordable Care Act and reforms to the Federal Employee Health Benefits program. However, another plan under consideration on Capitol Hill may have a greater impact on feds’ long-term financial well-being — the chained Consumer Price Index.

“This is going to to affect current employees when they retire,” said David Snell, director of retirement services for the National Active and Retired Federal Employees Association. “It’s going to affect current retirees. It’s going to affect survivors of those retirees, because those survivors will also see a loss in the amount of inflationary protection that will be offered if the chained CPI is enacted.”

Small cut has big impact on feds’ retirement benefits

The Obama administration has come out in support of the chained CPI, which originated as a recommendation of the Simpson-Bowles Commission.

Because the cut appears to be small, it will be easy for people to miss its true impact when it goes into effect.

“For federal retirees, who elect survivor benefits, those survivor benefits are also subject to these cost-of-living increases, so if something happens to them, their survivor is going to see less of a yearly increase than they would normally under the current CPI,” Snell said. “It has a lot of effect over a period of years, and it’s no way to secure your future in retirement.”

Snell said the president’s budget proposal contains another item of interest to feds — the self-plus-one employee health option.

via Chained CPI could cost feds thousands over time, NARFE says – FederalNewsRadio.com and

New health plan options & reduced retirement benefits