Mike Causey's Federal Report

The Incredible Shrinking Postal Service

 

Thursday - 4/19/2012, 5:30am  ET

By Mike Causey

@Causey_WFED
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How often do you actually go to the post office? Once a week? Once a month? Never, except on Tax Day?If you are among the millions of last-minute tax-filers, then it doesn't matter how infrequently you make it to the nearest post office. Odds are you popped in Tuesday — which is exactly why concerned, off-duty postal workers were on hand at many offices to warn taxpayers of pending postal cutbacks.
Members of the American Postal Workers Union and the National Mail Handlers Union oppose U.S. Postal Service plans to reduce the size of the workforce, eliminate Saturday delivery and set up a stand-alone USPS-only health insurance plan outside of the government-wide Federal Employee Health Benefits Program.
The two unions decided that Tuesday was the best day to hand out leaflets to frantic customers, because it was the deadline for getting postmarks on your 2011 tax returns. April 15 — the regular deadline — fell on Sunday and taxpayers got another day to do their taxes because April 16 was a special holiday (Emancipation Day) here in the District of Columbia.
Timing, the unions figured, is everything. And maybe they are right.
Also on Tuesday, the Senate voted to debate the comprehensive and controversial USPS plan to save the federal mail service, which is losing money big-time. It's the victim of private competition (UPS, FedEx, DHL), which promises to move faster and more reliably (for a price) while leaving the Postal Service to take a letter from Miami to Anchorage for 44 cents. The Postal Service is also losing money because of email and texting, which, for many people, have eliminated the need to send letters.
The so-called 21st Century Postal Service Act — proposed by Sens. Susan Collins (R-Maine), Scott Brown (R-Mass.), Thomas Carper (D-Del.) and Joe Lieberman (I-Conn.) — is about as fed-friendly a quorum as you can find in the Senate.
The bill would allow the Postal Service to offer buyouts to up to 100,000 employees but requires that half of the 200 offices and facilities the USPS wants to close to remain open, although they may be moved to and operated inside large commercial box stores, like Wal-Mart.
Postal watcher Sean Reilly of the Federal Times, outlined the postal reform plan yesterday on our Your Turn radio show. Federal Times Editor Steve Watkins and Washington attorney Bill Bransforddiscussed the ever-changing "scandal" at the General Services Administration. If you missed the show, want to hear it again or pass it on to a friend it is archived on our home page. You can listen anytime by clicking here.

Republicans Self-Destruct Over Medicare

Posted by: Linda Carbonell on March 18, 2012.
From left: Sens. Lindsey Graham, Rand Paul, Jim DeMint and Mike Lee announcing their plan to "save" Medicare

Okay, it’s not the whole party, though the proposal put forth by Senators Jim DeMint and Lindsey Graham of South Carolina, Mike Lee of Utah and Rand Paul of Kentucky is right in line with the party’s goal They want to end Medicare and fold all senior citizens into the Federal Employee’s Health Benefit Plan.



The FEHBP is erroneously held up as some kind of perfect private health insurance system. Republicans point at it and their followers insist that Federal employees and legislators have the best health care system in America. It involves a couple of nation-wide fee-for-service plans, Blue Cross-Blue Shield and Mailhandlers, and dozens of smaller plans available in individual locations. These can be anything from an HMO to a PPO to a fee-for-service plan to closed systems that are owned by a hospital or doctors’ group, with four levels of coverage, self-only-high and self-only-low, family-high and family-low. To really appreciate the Federal health insurance system, picture a phone book for a small city. That’s what you have to wade through to find the policy for you. It’s like picking a plan for Medicare drug coverage times ten.



I can think of over a million people who will object to this idea….federal employees and retirees. Been there, done that, cannot wait for Medicare.



I’m one of them. My husband is a Federal retiree. He retired before reaching 65, after thirty years in the government. We pay $460 a month for our health insurance premiums for two people, with a $600 deductible and 20% co-pays. One of my prescriptions must be name-brand. I have very bad reactions to the generics. Our insurance company has decided that my doctor made a mistake and I’m just screwing with the system, so I have to pay a 75% co-pay on that one scrip.



In eight months, my husband will go on Medicare. His premium will be $99.90 a month with a $140 deductible and 20% co-pay for Plan B. He will need a supplemental plan for prescription drug coverage. I will go on one of Vermont’s health insurance plans, for which the premiums and deductible are income-adjusted. In short, our health insurance costs will be cut in half.



Right now, half of my husband’s income from his part-time job goes to cover the amount the FEHBP takes out of his pension. He will be able to cut back his hours just because of Medicare.



Frankly, we’re both tired. We’ve been working since we were teenagers. We were barely middle class, never quite breaking the median-income ceiling. Medicare means we can finally retire. It means the same thing for a lot of people. It also means being able to afford health care. The premiums we pay now eat up so much money that the deductible is a deterrent to having tests done and seeing the doctor on a regular basis.



Medicare isn’t broken. It is one of the most successful programs in American history. There are a lot of ways it can be improved, starting with a better system for detecting and prosecuting fraud, and finally expanding Vermont’s landmark Choices for Care program for long-term care for the elderly into Medicare nation-wide. Like all health insurance programs, there needs to be more emphasis on preventive care, more rewards for over-all effectiveness and less attention to trying to cover one’s ass – ordering too many tests just to prevent malpractice suits. The Canadian national health system includes a board that determines where highly expensive equipment is needed and discouraging overlaps of services.



Medicare and Social Security, along with Medicaid and other programs to support the neediest among us, eat up as much of the Federal budget as the Defense Department. The Republicans want to protect every dime in the Defense budget and cut their promised billions of dollars out of the safety net. This proposal proves once again that keeping Americans alive and healthy is less important to the Republicans than America retaining a defense budget equal to the combined defense budgets of every other nation on the planet.



It is moments like this that make one realize that Senators and Congressmen don’t handle their own family budgets. They don’t write the checks for co-pays and deductibles if a family member gets sick. They don’t pick up their own prescriptions. Or maybe, at $174,000 a year, it doesn’t matter to them. But they should be able to do the same comparison that I did, of the premiums and costs. Maybe they did. Maybe they are so deeply indebted to the insurance industry that they simply don’t care how much harm they do

USPS plan to set up own health plan faces lawmakers' skepticism

USPS plan to set up own health plan faces lawmakers' skepticism


Tuesday - 3/27/2012, 12:48pm ET

By Jolie Lee

@jleeWFED





Postmaster General Patrick Donahoe testifies before a House Oversight subcommittee on March 27, 2012. (Video still from Thomas.gov)The Postal Service's plan to withdraw from the federal health insurance program and set up its own health program for postal employees and retirees faced skepticism from lawmakers.

Postmaster General Patrick Donahoe testified today before a House subcommittee, saying a USPS-sponsored plan would save $7 billion a year. Such a plan, Donahoe said, would offer equal or better coverage for current employees and retirees.







What's in the USPS health plan proposal?

Currently, the Federal Employees Health Benefit Program has about 8 million participants and offers 18 health plan options nationwide to all federal employees.



The Postal Service proposal would offer a simplified plan structure with high, middle and value options and four tiers within the options: self, self and spouse Self and child(ren), self and family.



Donahoe said the Postal Service is currently the second-largest contributor to Medicare, which would be a key to cost-savings. The USPS is proposing Medicare be the participants' primary provider and have a backup plan for "wraparound" coverage, he said.



Currently, USPS pays $13.2 billion in annual health care costs, according to Donahoe's testimony. He said the savings would be passed to employees and retirees as well, who would see $650 million in reduced contributions.



Additional savings would come from offering wellness incentives and disease management programs.



USPS would not manage the program itself but bid competitively for one of the large health care providers, such as Blue Cross Blue Shield or United Healthcare, Donahoe said.



The plan also would eliminate the need for USPS to prefund its retiree health benefits, he said.





"We are asking for the ability to better manage our costs," Donahoe said. "Without this fundamental change to dramatically reduce health care spending, there is no assurance we can afford our health care commitments to Postal employees and retirees."

Without action, the Postal Service projects deficits that exceed $21 billion annually by 2016.



Members of the House Committee on Oversight and Government Reform questioned the cost and effectiveness of a USPS-negotiated plan.



"You're making me nervous" said Rep. Stephen Lynch (D-Mass.). Lynch said the Mail Handlers Benefit Plan within FEHBP is a popular choice among USPS employees. "You know, people hate change, especially if they have something that works for them," Lynch said.



Committee Chairman Darrell Issa (R-Calif.) said he would probably support the Postal Service proposal to pull out of FEHBP, but added, "Let's have no illusion. You're just cost-shifting. There's no real cost-savings to the American people. The money will be paid out of one hand in order to save out of the other hand."



Others had more forceful words, like Rep. Gerry Connolly (D-Va.). "I just want to cite H.L. Mencken, who once said for every human problem, there is a solution that is simple, neat and wrong," Connolly said. "The postmaster general's proposal on health care fits that description."



Impact on FEHBP



One health care expert said the USPS health plan proposal would "massively disrupt or destroy the FEHBP."



Walton Francis, author of the Checkbook's Guide to Health Plans for Federal Employees, said FEHBP is a "winning model." But carrying out the Postal Service plan would "decimate" any plan that enrolls half or more postal employees, Francis said in his testimony.



"Their proposal isn't going to save money. It's going to cost money," Francis said.



The health plan proposal is part of the Postal Service's five-year plan that would reduce the workforce by 155,000 through attrition, cut back delivery to five days, and close up to 252 mail-processing centers and 3,700 post offices.



The House subcommittee hearing comes as the Senate was set to debate a postal reform bill this week but has postponed a procedural vote to start debate. The legislation would allow the agency to spread out its $5.5 billion annual payments for future retiree health benefits. The next payment is due in November, and without action, the USPS will be unable to make that payment, Donahoe said today.



Donahoe urged immediate action from Congress. "Doing nothing is not an option," he said.



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