Federal employees and federal retirees are covered under the Federal Employee Health Benefits Program (FEHBP), but that doesn’t mean they will not be affected by a possible repeal of the Affordable Healthcare Act, better known as Obamacare. In fact, repealing Obamacare will directly affect current employees and retirees, many of whom participate in Medicare, which benefits greatly from Obamacare provisions.

Federal Employees and Medicare

Most federal employees are eligible to participate in Medicare Part A (hospital insurance) at age 65 because they have paid into the program through payroll tax while working. Even though they may already have health insurance through FEHBP, the Office of Personnel Management (OPM) encourages them to enroll in Medicare Part A because it can reduce their out of pocket expenses and FEHBP costs, which helps moderate FEHBP premiums.

Federal retirees with higher healthcare needs also opt for Medicare Part B (medical insurance), which provides coverage for areas not covered by their FEHBP plans. Medicare Part B beneficiaries pay a monthly premium and are subject to deductible payments for some services, though under the ACA, some preventive health services are provided at no cost to them.

Many federal employees who are 65 or older and still working are enrolled in Medicare. And in these cases, Medicare is their primary insurance and FEHBP is supplementary. Any cuts to Medicare will affect them.

What Will Happen to Medicare if ACA/Obamacare Is Repealed?

• Nearly 11 million Medicare beneficiaries saved $21 billion on prescription drugs between 2010 and 2015 – an average of $1,945 per person – because Obamacare’s gradually closing the coverage gap for prescription drugs, known as the donut hole. If the Obamacare is repealed, the donut hole will reappear.
• Obamacare has made Medicare more financially stable by reducing the growth of healthcare costs and by cracking down on waste, fraud, and abuse. Removing these reforms will hurt the program and raise costs for retirees.
• Medicare beneficiaries will no longer receive free preventive care services such as flu shots and screenings for cancer, diabetes and other diseases.
• Obamacare has reduced the number of uninsured Americans from 41.3 million to 28 million. Repealing Obamacare would result in the increase of the uninsured. Without access to affordable health care, they will be in poorer health by the time they reach 65, which will drive up Medicare costs.

What Will Happen to Federal Employees and Federal Retirees if Obamacare Is Repealed?

• Obamacare allows children up to age 26 to be on their parents’ insurance plan. If Obamacare is repealed, adult children of federal employees will immediately lose their insurance. They will also lose their free preventive care that Obamacare provides.
• Obamacare requires all insurers – including FEHBP insurers – to spend at least 80 percent of premiums on medical care or functions that improve the quality of care. For those covered by large group policies, insurers must spend 85 percent. Insurers who fail to meet this standard must provide policyholders with a rebate instead of pocketing the extra premiums as profit. If Obamacare is repealed, the quality of care will go down and insurers are free to make even more money off people’s illnesses.
• Federal employees may have family members who are affected by the return of the donut hole.
• The cost of Medicare is likely to go up if Obamacare is repealed, which will affect federal retirees who are enrolled in the program. Part A deductibles and copays would go up. Premiums and deductibles for those who opt for Part B would go up as well.