Civil Service 

Retirement 

System 

Federal Employees’ 

Group Life 

Insurance Program 

Federal Employees 

Health Benefits 

Program 

Federal Employees 

Retirement 

System 

Long Term 

Care Insurance 

Program 

United States 

Office of 

Personnel Management 

The Federal Government’s Human Resources Agency

Retirement and Insurance Service 

Benefits Administration Letter 

Number: 01-319 Date: May 30, 2001 

Subject: Revised Effective Date of FEHB Open Season Elections - Impact on Withholdings 

 and Contributions

We will soon issue regulations that will change the effective date of all future Federal Employees 

Health Benefits (FEHB) Program open season elections, beginning with the upcoming open 

season. Rather than on the first day of the first pay period beginning in January, as is the current 

rule, all future open season elections will take effect on 

January 1. Nonetheless, according to law, the new withholding and contribution rates for the 

calendar year following the open season will continue to be effective on the first day of the first 

pay period beginning in January. 

The revised January 1 effective date of FEHB open season elections will not usually coincide with 

the first day of the first pay period beginning in January; for instance, the first pay period in 2002 

for most employees begins on January 13. This disconnect between the January 1 effective date 

of open season elections and the beginning of the first pay period in January will have no effect on 

FEHB withholdings and contributions, EXCEPT where an individual changes enrollment codes 

during the open season. For these enrollees, FEHB withholdings and contributions for the pay 

period that includes January 1 should technically be prorated between their “old” and “new“ 

enrollment codes. Nonetheless, we are NOT requiring agency payroll offices (APOs) to prorate 

withholdings and contributions for 2002 or thereafter . We do, however, encourage those APOs 

that can easily modify their payroll systems to enable this proration to do so. 

APOs that do prorate withholdings and contributions for the pay period that includes January 1 

will segment this pay period into the number of calendar days that fall in December and the 

number that fall in January. 
-2- 

For the calendar days that fall in December, withholdings and contributions must be 

based on the previous year’s rates of the employee’s "old" FEHB enrollment code. 

For the calendar days that fall in January, withholdings and contributions must be based 

on the previous year’s rates of the employee’s "new" enrollment code. 

For instance, using the pay period that will begin on December 30, 2000, and end on 

January 12, 2001, APOs will base 2/14 of withholdings and contributions on the 2001 rates of the 

"old" enrollment code and 12/14 on the 2001 rates of on the "new" enrollment code. 

Perhaps the following illustration will help clarify the proration methodology: 

Sandra Marks is an enrollee in plan XY1 in 2001, which has biweekly withholdings and 

contributions of $100 and $200, respectively, in 2001. During the 2001 open season, Ms. 

Marks elects coverage in plan AB1. AB1 has withholdings and contributions of $125 and 

$225 respectively, in 2001 and will have withholdings and contributions of $150 and $250 

respectively, in 2002. 

Ms. Marks is paid like most employees on a biweekly basis and her first pay period in 2002 

will begin on January 13. Ms. Marks’ APO will make the following FEHB withholdings 

and contributions for her: 

Date Plan 

Withholding 

Rate 

($) 

Contribution 

Rate 

($) 

Withholding 

Amount 

($) 

Contribution 

Amount 

($) 

12/30/01 XY1 100.00 200.00 * 

14.29 

* 28.57

1/1/02 AB1 125.00 225.00 ** 107.14 ** 192.86

1/13/02 ABI 150.00 250.00 150.00 250.00

* (withholding) $100 X 2/14 

(contribution) $200 X 2/14 

 

** (withholding) $125 X 12/14 

(contribution) $225 X 12/14 

 
-3- 

If an individual enrolls in a plan that did not exist in the previous year, there will be NO proration. 

 Withholdings and contributions for the “new” plan will be effective on the first day of the first 

pay period beginning in January. For the “old” plan, withholdings and contributions will continue 

until the last day of the pay period that includes January 1. 

If you have any questions regarding this information, we would prefer that you email us at 

finance@opm.gov, so that we have a record of our communication. You may also phone us on 

(202) 606-0606. 

 Robert A. Yuran, Chief 

 Financial Policy Staff