You and Your Health Care Choices: How to Minimize the Effect of the Wage Freeze

You can make a health care choice today that minimizes the effect of the President’s proposed freeze of your federal employee salary.


Colleen M. Murphy


You can make a health care choice today that minimizes the effect of the President’s proposed freeze of your federal employee salary. As you know, the President recently proposed freezing the annual two percent increase for all federal employees, with the exception of active military personnel. No one likes their salary frozen, but the health care choice you make this open season could minimize the effect on you and your family’s finances.

Let’s examine this freeze in numbers that are relevant to you. If you make $50,000, you will need to offset your annual expenses by $1,000 per year; if $90,000, by $1,800 per year. Fortunately, one way to reduce your expenses next year is available right now. The federal open season is an opportunity to carefully examine your health care options and make more cost-effective choices.

Here’s how:

  1. Use PlanSmartChoice’s Medical Cost Calculator to project your family’s total health care costs. Federal employees have an average of 20 medical plan options, and your costs—taking into account employee premiums and out-of-pocket expenses—may vary by thousands of dollars across these options. For example, by switching from one Consumer Directed Health Plan to another or one High Deductible Health Plan to another, a family of three with moderate medical needs can reduce their costs by $1,000 to $2,000 for the year.
  2. Switch to your insurance carrier’s less expensive option. The same family can save $1,500 per year by switching—for example—from Kaiser’s High Option to its Standard Option, or from Aetna’s Consumer Directed Health Plan to its High Deductible Health Plan. You can also choose from multiple options and reduce your costs with GEHA, Mail Handlers, and SAMBA.
  3. Participate in FSAFEDS. After selecting a health plan, contribute the amount of your out-of-pocket medical costs—plus any dental and vision expenses—to the Health Care Spending Account (or, if applicable, Health Savings Account). Last year, PlanSmartChoice users contributed an average of $2,000 to the Health Care Spending Account and saved themselves an average of $561.
  4. Change how you buy prescription drugs. First, ask your doctor if you can switch from a brand name to a generic prescription. BCBS Basic plan members save $30 per month by switching one prescription from brand name to generic. Second, if you use something monthly, buy a 90-day supply through your plan’s mail order program rather than at your local pharmacy. In addition to the convenience of mail order, BCBS Standard plan members can save $300 or more per year per prescription.

Again, no one is happy about a salary freeze. Fortunately, federal employees can choose from a wide range of health care options, participate in FSAFEDS, and change their prescription drug behavior to reduce their costs and offset the freeze. In addition to PlanSmartChoice, organizations like OPM, Consumers Checkbook, and the health plans all provide tools to help you evaluate these options. For more information, please visit our site or become a fan of us on Facebook for up-to-date information.


Colleen M. Murphy

Colleen M. Murphy is the
President and CEO of Asparity Decision Solutions. Hundreds of thousands of federal employees have used PlanSmartChoice, the company’s decision support tools, to choose health insurance coverage.