FEHB Premium Hikes Have Hit Again—Here’s How to Make Sure You’re Not Overpaying for Health Coverage

Key Takeaways

1. FEHB premiums increased significantly in 2025, putting financial strain on federal employees and retirees. Learn how to mitigate these costs.

2. Understanding your FEHB plan options and making strategic adjustments can help ensure you’re not overpaying for coverage.

Why FEHB Premium Hikes Matter to You

If you’re a federal employee or retiree, you’ve likely noticed that FEHB premiums have gone up again in 2025. With an average increase of 11.2%, these hikes can take a significant chunk out of your budget. For retirees, especially those on fixed incomes, these increases can feel overwhelming. But don’t worry—you have options to navigate these rising costs without sacrificing quality healthcare coverage.

Get Familiar with Your Plan Details

The first step to ensure you’re not overpaying is understanding the details of your current FEHB plan. Review your plan’s:

• Premiums: Know how much you’re paying monthly and annually.

• Deductibles: Be aware of how much you need to pay before your insurance kicks in.

• Copayments and Coinsurance: Check the out-of-pocket costs for doctor visits, prescriptions, and other services.

• Coverage Limits: Ensure your plan covers the services you use most frequently.

This information is typically available through your plan’s benefits brochure or online portal. If you’re unclear, don’t hesitate to contact your plan provider.

Compare Plans During Open Season

Open Season is your annual opportunity to evaluate and switch FEHB plans. It usually takes place from mid-November to mid-December, so mark your calendar. During this time, you can:

• Switch to a different FEHB plan: Look for a plan with lower premiums or better benefits.

• Consider high-deductible health plans (HDHPs): These plans often have lower premiums and are compatible with Health Savings Accounts (HSAs), which offer tax advantages.

• Review plan changes: Plans often update their premiums, coverage, and provider networks, so what worked last year might not be the best fit now.

Use OPM’s Plan Comparison Tool to analyze your options. Focus on total costs, including premiums, deductibles, and out-of-pocket maximums, rather than just the premium.

Take Advantage of Medicare Coordination

If you’re retired and enrolled in Medicare, coordinating your FEHB plan with Medicare can result in substantial savings. Medicare typically becomes your primary insurer, with your FEHB plan as secondary coverage. This can mean lower out-of-pocket costs for:

• Hospital stays

• Doctor visits

• Prescription drugs

Many FEHB plans offer incentives like reduced deductibles and copayments for members who also have Medicare Part B. Check your plan’s brochure to see how it integrates with Medicare and consider enrolling in Part B if you haven’t already.

Review Your Healthcare Usage

Do you really need all the benefits your current plan offers? Take stock of your typical healthcare needs:

• Doctor Visits: Are you a frequent visitor to specialists, or do you primarily see a general practitioner?

• Medications: Do you require brand-name prescriptions, or would a generic drug suffice?

• Specialized Services: Are you using services like physical therapy, mental health care, or chiropractic treatments?

If you find you’re paying for services you rarely use, it might be time to switch to a plan that better matches your needs. On the other hand, if you anticipate increased healthcare needs, ensure your plan covers them adequately.

Don’t Overlook Preventive Services

Most FEHB plans cover preventive care services like annual physicals, vaccines, and screenings at no additional cost to you. Taking advantage of these services can help you avoid more costly treatments down the road. Make it a point to:

• Schedule your annual check-ups.

• Stay up-to-date on recommended vaccinations.

• Participate in wellness programs offered by your plan.

Preventive care not only keeps you healthy but also helps you make the most of your FEHB plan benefits.

Explore Flexible Spending Accounts (FSAs)

FSAs allow you to set aside pre-tax dollars for qualified medical expenses. For 2025, the maximum contribution limit is $3,300, with a carryover option of up to $660 for unused funds. Use your FSA for:

• Copayments and coinsurance

• Prescription medications

• Dental and vision care

FSAs can significantly reduce your taxable income, putting more money back in your pocket. Just remember to use the funds within the allowed timeframe to avoid forfeiting them.

Check for Hidden Costs

Sometimes, the true cost of your FEHB plan isn’t immediately apparent. Be on the lookout for:

• Out-of-network charges: Using providers outside your plan’s network can result in higher costs.

• Balance billing: Some providers bill you for the difference between their charges and what your plan reimburses.

• Non-covered services: Always confirm whether a service is covered before scheduling.

Staying within your plan’s network and understanding what’s covered can help you avoid unexpected expenses.

Consider Your Family’s Needs

If you’re covering a spouse or dependents under your FEHB plan, their healthcare needs are just as important. Evaluate whether a family plan is still the best option or if splitting coverage might save money. For example:

• Dual federal employees: If both spouses are federal employees, it might be cheaper to enroll in separate Self Only plans rather than a Self Plus One or Family plan.

• Dependent children: Once your children age out of FEHB eligibility, switch to a smaller coverage tier to lower your premiums.

Regularly reassessing your family’s healthcare requirements ensures you’re not paying for unnecessary coverage.

Make the Most of Wellness Incentives

Many FEHB plans offer wellness incentives that can offset your costs. These might include:

• Cash rewards for completing health assessments

• Discounts on gym memberships

• Tobacco cessation programs

• Weight loss support

Take advantage of these programs to improve your health and reduce your overall healthcare expenses.

Plan for Future Increases

FEHB premiums are unlikely to stop rising, so it’s wise to plan for future increases. Consider:

• Budgeting: Allocate a portion of your income to cover premium hikes.

• Increasing TSP contributions: Your Thrift Savings Plan can act as a safety net for future healthcare costs.

• Exploring supplemental coverage: If you anticipate higher medical expenses, supplemental insurance might help fill the gaps.

Proactively preparing for rising costs ensures you’re financially ready for whatever changes come your way.

Stay Informed

The best way to avoid overpaying is by staying informed about your options. Regularly check updates from OPM, review your plan’s brochures, and participate in webinars or seminars about federal benefits. Knowledge is your most valuable tool in navigating the complexities of FEHB.

Take Control of Your Healthcare Costs

Rising FEHB premiums may feel unavoidable, but you’re not powerless. By reviewing your plan options, leveraging Medicare coordination, and making use of wellness incentives, you can reduce your out-of-pocket costs. Don’t let premium hikes dictate your financial well-being. Take charge, reassess your needs, and make smart choices to ensure your healthcare coverage fits your budget and lifestyle.