Another Victory For The FEHBP

The New York Times has an interesting report that The Federal Employees Health Benefits Program has once again had a lower rate of premiums than even many private employers. Conservatives have long touted the FEHBP as a model for privatizing the Medicare system to increase consumer choice and lower payments.

The FEHBP works because it provides free-market choice for its 8.3 million clients and keeps costs down by cutting regulation and red tape. Contrary to Medicare, where premiums are soaring, the FEHBP has managed to keep price increases on key areas like prescription drug costs.

The facts further bear out the argument that a system that provides free market choices to consumers under a system that eliminates unnecessary regulation will beat a highly regulated system with no or few options. While privatization might as well be a four-letter word among many in Congress, the FEHBP shows that such a model not only would work in theory, but is already working in practice.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.