How big the increases will be depend on which of the 250 plus plans you are in and whether you decide to stick with your current plan in 2010 no matter what, or whether you switch plans during the November-December benefits open season. This year the premiums jumped an average of 7 percent.

For the record many federal workers and the vast majority of federal retirees stick with the same plan year after year. On average only 5 to 6 percent of the 9 million people covered by the FEHBP change plans each year.

Unless your plan's premiums go out of sight, the average federal worker, looking at a pay raise in the neighborhood of 3 percent, can absorb most premium hikes. The added value of a pay raise is usually higher, much higher, than the financial bite from a premium increase.

And many feds, who follow the economic news will just be glad they still have a job, and aren't like many Americans taking pay cuts, or seeing their health benefits reduced or eliminated. And to be in a plan where, regardless of how much premiums increase, their employer (the federal government) pays 70 percent or more of the total premium.

But any premium hike will hit federal retirees, and especially their survivors who must live off reduced benefits, hard. The good news for retirees is that they get the same benefits and pay the same premiums as young, healthy federal workers.

However...

The bad news is that unlike their working counterparts, the retirees probably won't be getting any cost of living adjustment in January, 2010. We first reported that sad fact of life in February and reaffirmed it in April.

Many retirees thought it was too bad, too gloomy, to be true. They figured it wouldn't, because, according to their living expenses, it couldn't happen. Especially since they got a 5.8 percent inflation catch up in January of this year that was driven by the spike in oil prices in the spring and summer of 2008.

But things change. We went from inflation to deflation almost overnight. Right now living costs are 2.1 percent less than they were in the third quarter of 2008.

The idea of a zero increase in federal, and military retirement benefits, and Social Security, just wasn't on most people's radar screen. But it is now.

The one bright spot for retirees is that even though living costs are down and we have gone through months of deflation, their benefits are intact. They won't be going up in January, but the good news is that they won't be cut either.

If you want to see where the Consumer Price Index (which acts as a trigger for the retirees COLA) is at, here's a chart from NARFE, the National Active and Retired Federal Employees Association, that will help you crunch the numbers.

Nearly Useless Factoid
by Suzanne Kubota

The name Pinocchio is a Tuscan word meaning "pine nut." Insert your own squirrel joke here.

To reach me: mcausey@federalnewsradio.com