Another Try Made on Short-Term Disability Insurance for Federal Employees – FEDweek

Legislation has been reintroduced in the House (HR-6932) to create a short-term disability insurance program for conditions not covered by the FECA workers’ comp program and that could be used, for example, as paid parental leave.

The bill is the latest in a series of attempts to fill one of the major gaps in insurance coverage the government offers to federal employees.

“Although federal employees have good health insurance, federal health benefits do not replace lost income if employees are unable to work. Moreover, while federal employees may have available sick or annual leave days, they may not have enough such days to pay the bills if they have to be out of work for an extended period, such as following surgery,” said sponsor Del. Eleanor Holmes Norton, D-D.C.

“Although there are long-term disability options for federal employees who become permanently disabled, federal employees do not qualify for such benefits until they have worked for the federal government for at least 18 months,” she said in introducing the bill.

Under her bill, the government would contract with one or more private insurance companies to offer coverage for injuries, illnesses and conditions that are not work-related. No one could be excluded due to pre-existing conditions and benefits would be payable for up to one year. Enrollees would pay the full cost with no government contribution but the large size of the potential enrollee pool would help hold down premiums versus what privately purchased policies would cost, she said.

Bills on the topic date back many years but have made little progress toward enactment. The most recent serious effort occurred more than a decade ago when OPM studied the options in detail. Interest that had been building quickly waned after OPM estimated that the cost to enrollees would be about $1,000 a year even for coverage that would be very limited in scope.