FOR IMMEDIATE RELEASE
September 23, 2024
Federal Employees to Face Largest Health Premium Increase in Over a Decade for 2025, According to OPM
Federal employees and annuitants enrolled in the Federal Employees Health Benefits (FEHB) program will face the largest premium increase in over a decade, according to data released by the Office of Personnel Management (OPM). Starting in January 2025, enrollees will see an average premium hike of 13.5%, significantly surpassing last year’s 7.7% increase.
OPM attributes the steep rise in health care premiums to industry-wide cost pressures, including increased prices from healthcare providers and suppliers, along with higher utilization of prescription drugs, particularly in the areas of behavioral health. The FEHB premium hike is in line with trends in the commercial market.
For federal employees, this translates to paying an average of $26.10 more biweekly for their health care coverage. The government’s share of the premium will also rise by 10.1%, bringing the total average increase to 11.2% when weighted with the government’s contribution.
In contrast, participants in the newly launched Postal Service Health Benefits (PSHB) program will see a slightly lower increase of 6.9% for the same plan year, largely due to the Postal Service Reform Act’s integration with Medicare and demographic differences. Postal employees will pay an average of $20 more per biweekly pay period.
This increase comes ahead of the annual Open Season period, which runs from November 11 through December 9, 2024. During Open Season, both FEHB and PSHB participants will have the opportunity to review and make changes to their health plan selections for 2025.
Changes to Plan Offerings and Benefits for 2025
As part of the changes for plan year 2025, OPM announced several updates to coverage, including expanded benefits for fertility treatments, behavioral health, and obesity medications. Notably, enrollees in select plans, including Blue Cross Blue Shield and GEHA, will have access to a $25,000 benefit for in vitro fertilization (IVF) treatment. Additionally, FEHB plans will be required to cover anti-obesity medications and comprehensive behavioral therapy for weight loss. Coverage for maternal health, including postpartum depression treatment and midwife care, will also be expanded.
For the PSHB program, coverage will largely mirror that of FEHB, with the exception of prescription drug benefits, where PSHB participants will receive Medicare Employer Group Waiver Plans (EGWPs).
Dental and Vision Premiums See Minimal Increases
While health care premiums are experiencing significant hikes, premiums for the Federal Employees Dental and Vision Insurance Program (FEDVIP) will see relatively modest increases. FEDVIP dental premiums will rise by an average of 2.97%, and vision plans will increase by 0.87%.
National Treasury Employees Union Response
In response to the premium increases, the National Treasury Employees Union (NTEU) has called for a 7.4% pay raise for federal employees to offset the rising costs. NTEU National President Doreen Greenwald expressed concern, stating, “Federal workers should not have to sacrifice health coverage because they can’t manage the higher payments.”
About The Benefit Coordinators
At The Benefit Coordinators, we specialize in helping federal employees maximize their retirement and health benefits. As premium increases take effect, we are here to provide guidance on selecting the most cost-effective and comprehensive options for your needs. Don’t let the rising costs catch you off guard—contact us today to schedule your free consultation.
Contact Information:
John Sanders
The Benefit Coordinators
Phone: (918) 245-1400 x103
Email: john.sanders@thebenefitcoordinators.com
Website: www.thebenefitcoordinators.com