Reps. question duplicate drug coverage for federal retirees

WASHINGTON Reps. Henry Waxman, D-Calif. and Danny Davis, D-Ill. have said that more than 200,000 federal retirees are enrolled in two government-sponsored prescription drug programs, and the duplicative coverage may cost more than $200 million annually, according to the Washington Post.

Waxman chairs the House Oversight and Government Reform Committee, and Davis is chairman of the House federal workforce subcommittee. Both have jurisdiction over federal retirement benefits, including health-care coverage provided to civil service and postal retirees.

In a letter to officials for the Bush administration, the two representatives also said that the federal retirees are probably paying $60 million in unnecessary premiums, and taxpayers are providing $140 million in subsidies.

The prescription drug benefits are provided to federal retirees through the Federal Employees Health Benefits Program and Medicare Part D. Congress directed Medicare to coordinate benefits with other prescription drug plans, but Medicare and FEHBP “have not acted to require or ensure effective coordination of the drug benefits,” Waxman and Davis wrote. As a result, private insurance companies offering Medicare Part D coverage “appear to be reaping a $200 million windfall annually, paid for by the retirees and American taxpayers,” they wrote.

Their letter, dated May 12, went to Linda Springer, director of the Office of Personnel Management, and Kerry Weems, the acting administrator for the Centers for Medicare and Medicaid Services. Neither group has responded as of yet.

In the letter, Waxman and Davis said briefings provided by the two agencies raised questions about whether taxpayer money was being wasted. Officials at the agencies, in discussions with the House committee, said there was almost no coordination between the two programs, the letter said.

When Medicare added a prescription drug benefit in 2003, OPM officials said federal retirees didn’t need to enroll in Part D and pay extra for prescription drug coverage because FEHBP benefits were better or equivalent to the coverage provided by Part D. The OPM also said FEHBP and Medicare would coordinate drug benefits, but Waxman and Davis wrote, “this does not appear to be happening.”