The CBO estimates that a bill before Congress would lead to an average decline in enrollment of 100,000 people. Image: pics five/Shutterstock.com

Another report to Congress estimates that the FEHB program costs $1 billion annually by insuring ineligible people as family members. These costs are passed on to both the insured and the government in the form of higher premiums.

The Congressional Budget Office estimate — which is consistent with one from the GAO last year — was made in an analysis of S-4035, which is up for a vote in the full Senate when Congress resumes on Sept. 9. A related bill, HR-7868, also passed at the House committee level.

The bills would require agencies to verify the eligibility of dependents enrolled in the FEHB when the employee or annuitant begins or changes enrollment for a dependent. They would also require OPM to verify the dependents’ enrollment in the program. They would also require the program’s fraud risk assessments to include information on ineligible individuals.

The analysis notes that the FEHB program currently has a value of $50 billion per year and that the “estimated average annual cost of enrolling a dependent in the program is $6,500.”

“CBO projects that implementation of the law would result in an average annual decline in enrollment of 100,000 people from 2025 to 2034. Reviewing eligibility during the open season would result in an average annual decline of 10,000 people over the same period,” it said.

However, this estimate is “subject to considerable uncertainty since no comparable review of the FEHB program has been carried out,” it said.

OPM has issued several policies in recent years aimed at reducing the number of ineligible people, following several inspector general reports and the GAO report. OPM has stated that the enrollment and enrollee tracking system being set up for the Postal Service Health Benefits program, which is set to launch in January as a largely parallel program to the FEHB for postal workers and retirees, will have better ways to identify ineligible enrollees.

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