As drug costs rise and people return to in-person doctor visits, federal employees and retirees should expect to pay 8.7% more, on average, for health insurance in 2023, according to data released Friday about the Federal Employees Health Benefits Program.
FEHB is the largest employer-sponsored health insurance program in the country and covers 8 million federal employees, retirees and family members.
“These premium increases may be similar to those expected by other large employers in the private sector, but they will still cause sticker shock for federal employees,” said Tony Reardon, president of the National Treasury Employees Union, in a statement.
Part of the insurance hike can be attributed to high prices for prescription drugs, expensive coronavirus-related claims and the resumption of in-person health care that was delayed during the pandemic, according to NTEU.
The government pays up to 75% of the cost of employees’ health benefits coverage, based on a formula set by law. OPM and the federal benefits carriers are tasked with negotiating benefits and rates for each plan year.
The government’s share of FEHB premiums will increase 6.6 percent, for an overall average premium increase of 7.2 percent, the highest single year increase since 2011.
For employees who enroll in the nationwide Blue Cross and Blue Shield standard option, for example, the family coverage will cost them $347.89 per biweekly paycheck in 2023, an increase of $33.78 over this year.
What to know ahead of open enrollment season
Open season for federal employees to re-enroll or change their health insurance for next year starts on Nov. 14 and goes through Dec. 12. With 271 plan options, OPM encourages enrollees to comparison shop.
Federal beneficiaries can find more open season information, including 2023 FEHB health plan comparison tools, on its website around the first week of November.
Last year, the average total premiums for non-Postal employees and annuitants in the FEHB Program increased 2.4 percent, the second lowest increase in more than two decades.
Molly Weisner is a staff reporter for Federal Times where she covers labor, policy and contracting pertaining to the government workforce. She made previous stops at USA Today and McClatchy as a digital producer, and worked at The New York Times as a copy editor. Molly majored in journalism at the University of North Carolina at Chapel Hill.