Professor Collaborates with Federal Agency to Study Employee Health Insurance Utilization.
Professor Collaborates with Federal Agency to Study Employee Health Insurance Utilization
Paul Shafer will analyze data for the Office of Personnel Management to understand the root causes of why some federal employees, particularly lower-income employees, choose not to enroll in the Federal Employee Health Benefits Program.
The Federal Employee Health Benefits Program (FEHBP) is the largest employer-sponsored health benefits program in the world, covering more than nine million current and former federal employees, family members, and former spouses. But not all federal employees opt to utilize these benefits, and federal officials have solicited the help of a School of Public Health researcher to understand why.
Paul Shafer, assistant professor of health law, policy & management, has begun a new fellowship with the Office of Personnel Management (OPM), the human resources arm of the government, to examine how employees utilize the FEHBP. The majority of federal workers—about 84 percent—do opt to enroll in this health insurance, but OPM is eager to learn the barriers and challenges that drive the other 16 percent of workers to other plans, with a goal to make the FEBHP accessible all workers.
In particular, Shafer will explore whether geographic, demographic, or income differences are driving lower-income workers, including those in the GS-9 pay scale and below, to enroll in other insurance plans, such as TRICARE or a spouse’s plan, instead of the FEHBP.
“Equity and evidence are cornerstones of the Biden administration, which is reflected in OPM working with an outside expert to apply a lot of the questions and methods used to explore the ACA Marketplace to a similar setting that serves approximately 9 million employees and retirees,” says Shafer, who is also a codirector of BU’s Medicaid Policy Lab and studies how health insurance and social safety net policies affect health.
During the project, he will analyze FEHBP data and use patterns, conduct focus groups with participants, and produce a report of the findings, with recommendations on how OPM can improve access the FEHBP.
Affordability may play a role in employees’ decisions to turn down federal medical benefits. Open enrollment for 2024 is now underway, and next year, federal employees will pay nearly 8 percent more, on average, for their FEHBP premiums. OPM says this increase is a result of increased cost and use of prescription drugs, emergency room care, and outpatient care.
“We are early in the project, but it does appear that lower-income employees are notably less likely to enroll,” Shafer says. “Is that because they can’t afford it? Possibly. The federal government contributes a fixed percentage of the premium for each employee, like many employer health plans, which means that premiums as a share of income are rising as income decreases.”
He will also study whether Medicaid expansion in many states is drawing eligible employees away from FEHBP.
Shafer says he is looking forward to the “fruitful collaboration,” which is an example of how academic-public partnerships can benefit the health of the public. “There are a lot of interesting questions that can be explored for helping federal employees and retirees afford and take full advantage of their benefits.”