FEHB open season is quickly drawing to a close. That means you only have a few more days to review your current federal health benefits selections and make any changes for 2025.
Many federal employees treat their health insurance as a “file it and forget it” benefit. Many have been with the same plan much or even all of their time in Federal Employee Health Benefits (FEHB) and pay little attention during open season, beyond a look at the new premium rates and at any major changes in coverage in their current plan.
In fact, according to the Office of Personnel Management (OPM), only about 5 percent of federal employees switch plans in any given year, even though all are eligible to change during annual open seasons.
While not everyone should change their plans, you could be leaving behind valuable savings. I would encourage you to take advantage of the open season by conducting a wellness and financial check-up for your healthcare coverage to ensure you’re getting the most from your benefits.
FEHB Open Season: Last Call to Enroll in or Change Your Health Benefits
Now through midnight on Monday, December 9th, you still have time to review and select new options under the Employees Health Benefits program, the Federal Employees Dental and Vision Insurance Program, or to make use of a Federal Flexible Spending Account Program.
2025 will see fairly significant changes in Federal benefits, with premium increases and the launch of the Postal Service Health Benefits (PSHB) program.
There are fewer plans available in 2025—42 carriers will offer 64 plans and a total of 130 plan options (compared to 158 in 2024 and 271 in 2023).
Will FEHB Premiums Increase in 2025?
Yes, federal employees and retirees will experience the largest annual increase in their health insurance costs in at least a decade. Those enrolled in FEHB will pay an average of 13.5% more in 2025. This follows a 7.7% average increase in 2024 and an 8.7% average increase in 2023. The FEHB premium rates are calculated each year by OPM and are based on how federal employees and retirees used their health care plans during the previous year.
Postal Service Health Benefits (PSHB) Program
2025 will be the inaugural year of the new Postal Service Health Benefits (PSHB) program. As of January 2025, one-fifth of FEHB enrollees will be transferred to this new system. This includes about 1.9 million USPS employees, annuitants, and their families.
PSHB enrollees will have 69 plan options across 30 health carriers to choose from. Some of these plans are specific to certain geographic regions or agencies. PSHB enrollees will also see a lower increase in premiums than FEHB participants—11.1% more on average (compared to 13.5%).
Medicare-eligible Postal annuitants and their family members will need to enroll in Medicare Part B to be able to access PSHB benefits. All PSHB benefits will align with FEHB, with the exception of prescription drug benefits.
Where Do I Start?
To help you get started, below are some questions to consider when reviewing your benefits and needs for healthcare coverage.
What are my and/or my family’s expected healthcare needs for 2025?
- Questions while reviewing your FEHB Program: Do I need surgery? Will my medication needs’ change? Does my plan provide a pharmacy mail order option for prescriptions?
- Questions while reviewing FEDVIP: Do I need routine dental care? Will I need a crown or root canal? Does my child need braces? Do I need glasses and/or contact lenses? Am I considering laser vision correction surgery?
- Questions while reviewing FSAFEDS: Do I have out-of-pocket expenses I need to consider, such as deductibles, copays, elder care, or over-the-counter drugs and medicines? Does my child need braces or use acne treatments?
What If I Do Nothing?
If you do nothing, your current coverage will automatically continue. If you are satisfied with your current FEHB plan, you do not need to take any action.
Don’t Neglect Savings Accounts
25% of government workers do not have a tax-free flexible savings account (FSA); however, almost every federal employee will have some type of out-of-pocket expense year over year. This can be used for over-the-counter medications and other uncovered costs, amounting to an average 30% in savings.
If this is important to you, don’t let your coverage lapse. You must re-enroll in an FSA each year.
Bottom Line
FEHB evolves over time, both due to new laws and decisions by OPM. Don’t make the mistake of thinking that your coverage next year will be just like this year.
Staying with what you already have is a decision too, and it may well be the best for you. But whatever you do, make sure your decision is made in a thoughtful way, with all the facts in hand.
If you’re ready to get serious about planning for your retirement from federal service, register to attend a workshop today!
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