Federal retirees face another significant increase in average FEHB premiums for 2027, according to OPM's Open Season highlights, as reported by FEDweek. Retirees now have to weigh plan choices against higher costs during Open Season.
Key Facts
- Average premiums are rising again. OPM's 2027 Open Season highlights show a significant increase in the average cost of FEHB coverage, per FEDweek.
- Retirees pay from their annuity. Premium changes take effect in January and reduce the net monthly annuity payment for enrollees who keep their current plan.
- Costs vary by plan. Increases differ across plans and options, so a plan's change may be higher or lower than the average.
- Open Season is the main chance to switch. Enrollees can change plans, options, or enrollment type (Self Only, Self Plus One, Self and Family) during the annual window. Without a qualifying life event, outside Open Season changes are generally not allowed.
- No action means automatic renewal. Enrollees who do nothing stay in their current plan at the new 2027 rate.
Context
The government pays a share of FEHB premiums, and enrollees pay the rest. By statute, the government contribution is based on a weighted average of premiums across participating plans and is capped at 75 percent of any individual plan's total premium. When average premiums rise, the dollar amount enrollees owe typically rises with them.
For retirees on fixed annuities, FEDweek's outline highlights the practical question: whether a different plan or coverage level offers a better balance of premium, deductibles, copays, and out-of-pocket maximums.
Retirees eligible for Medicare may also want to compare how each plan coordinates with Parts A and B, since some plans offer features aimed at Medicare enrollees. Check each plan's 2027 brochure for details.
What It Means For You
- Compare total costs, not just premiums. A lower-premium plan can cost more if you use a lot of care. Add up expected premiums, deductibles, copays, and prescription costs.
- Review your coverage level. If a household member has lost eligibility or has other coverage, a Self Plus One or Self Only enrollment may be an option.
- Check your plan's 2027 brochure. Benefits, formularies, and provider networks can change from year to year even if the plan name stays the same.
- Run the numbers. OPM's plan comparison tools list 2027 rates by plan. The FEHB value guide can help you weigh what your coverage is worth against its cost.
- Mind the deadline. Open Season runs for roughly a month beginning in mid-November. Confirm exact dates with OPM or your retirement system.
Source: FEDweek