Federal Employees Health Benefits Program: Early Experience with a Consumer-Directed Health Plan

Since 2003, the Federal Employees Health Benefits Program (FEHBP) has offered "consumer-directed" health plans (CDHP) to federal employees. A CDHP is a high-deductible health plan coupled with a savings account enrollees use to pay for health care. Unused balances may accumulate for future use, providing enrollees the incentive to purchase health care prudently. However, some have expressed concern that CDHPs may attract younger and healthier enrollees, leaving older, less healthy enrollees to drive up costs in traditional plans. They also question whether enrollees are satisfied with the plans, and have sufficient access to health care providers and discounts on health care services. GAO was asked to study the first FEHBP CDHP, offered by the American Postal Workers Union (APWU). GAO compared the number, characteristics, and satisfaction of APWU enrollees to those of FEHBP enrollees in other recently introduced (new) non-CDHP plans, and national preferred provider organization (PPO) plans. GAO also compared the APWU CDHP provider networks and discounts to those of other FEHBP plans.