One proposal considered by the Senate Finance Committee would impose a 40 percent tax on so-called Cadillac coverage health plans. Last week Rep. Jim Moran (D-Va.) warned about the proposal. He said it would slap a 40 percent tax on health plans where the cost to the government exceeds $8,000 a year. Moran said that since the average FEHBP plan now costs around $6,000 that sounds okay. But...

The problem, Moran said, is that the Senate proposal, which will come up in any House-Senate conference on health care reform, would include dental, and vision benefit plans and Flexible Spending Accounts in the total. That, for many employees, would put a the total premium cost well within the proposed tax range.

One version of the Senate plan, as we tipped you earlier would also cut in half the amount of money workers can earmark for Flexible Spending Accounts. FSAs are funded biweekly on a pre-tax basis. Workers can put up to $5,000 per year in their accounts and use the money to pay for medical items (from eye-glasses to sunblock and aspirins) that are not covered by your health plan. The government estimates that users save (meaning the Treasury loses) $7 billion a year in taxes.

There are a number of health care reform plans on Capitol Hill.

Once the Senate and House agree on their respective plans they will go to conference to iron out the differences. But both are looking to come up with offsetting revenue sources to pay for other provisions of the final bill. And you could be one of those offsetting sources.

Fasten your seat belts!

Scholarship Winners

The Federal Employee Education and Assistance Fund has announced the 7 winners of a total of $46,500 in scholarships. FEEA is a feds-helping-feds charity and the scholarship program was set up in conjunction with a grant from the National Treasury Employees Union. Six of the scholarships are paid for by Blue Cross-Blue Shield. Feds and their children are eligible and this year's the winners and their schools are:

• Alexander Chen, son of Linyuan Chen of the Internal Revenue Service in Andover, Mass., and freshman at Harvard University.
• Ian C. of New York City, intelligence analyst and graduate student.
• Jessica Fertitta, daughter of Terry Meighen of the Federal Bureau of Prisons in Grand Prairie, Texas, and graduate student at University of Texas School of Law.
• Robert Griffin, son of Janice Griffin of the Nuclear Regulatory Commission in Chattanooga, Tenn., and sophomore at Tennessee Technological University.
• Elissa Redmiles, daughter of Mark Redmiles of the Department of Justice in Washington, D.C., and freshman at University of Maryland, College Park.
• Alison Serota, daughter of Sandra Garcia of the Department of Education in Washington, D.C., and sophomore at Virginia Tech University.
• Lauren Sommero, daughter of Thomas Sommero of the Department of Labor in Newark, N.J., and freshman at University of Pennsylvania.

Also on FederalNewsRadio.com
From the Newsdesk

The possibility of a bigger pay raise for feds in 2010 still exists. The Senate has yet to take up its appropriation bill, which includes a 2.9 percent hike, instead of the 2 percent the President supports. For details on the Tuesday Morning Federal Newscast, click here (look for the first item.)

More participation means good things for all invested, according to the TSP's Tom Trabucco. He talks more about this and additional benefits of the TSP when compared to some private sector funds on the Daily Debrief. To read the story or hear the interview, click here.

Nearly Useless Factoid
by Suzanne Kubota

From the Maidenhead Advertiser: "It is believed that the Irish began the tradition of Trick or Treating. In preparation for All Hallow's Eve, Irish townsfolk would visit neighbours and ask for contributions of food for a feast in the town."

To reach me: mcausey@federalnewsradio.com