Participants in the Federal Employees Health Benefits (FEHB) Program will experience a significant increase in insurance costs in 2024, though it is slightly lower than the previous year. According to data released by the Office of Personnel Management (OPM), federal employees and retirees will pay an average of 7.7% more towards their health premiums starting in January. This announcement precedes the start of Open Season, during which FEHB participants can make changes to their health plans. Despite the increase, OPM stated that the premium rates for 2024 are in line with those in the commercial market, and the government will contribute 5% more towards FEHB premiums.
CalPERS, the second-largest public insurance purchaser in the U.S., announced even higher premium rate increases for 2024, averaging 10.77%. The 7.7% increase for FEHB participants is an average, and the actual amount paid may vary depending on plan options and enrollments. While the increase is lower than the 8.7% jump for 2023, it is still higher than the rates in 2019 when participants paid just 1.5% more. The National Active and Retired Federal Employees Association (NARFE) expressed concerns about the rising costs, emphasizing the importance of comparison shopping among the broad array of plan options offered by FEHB.
In addition to the premium increase, FEHB participants will also see a decrease in plan options for 2024 due to the exit of health carrier Humana. However, there will still be 159 plan options available across 69 health carriers. Furthermore, starting in 2024, active-duty service members and members of the Active Guard Reserve will become eligible for a Dependent Care Flexible Spending Account, and FEHB carriers will offer expanded coverage for various healthcare services, including anti-obesity medications, telehealth options, gender-affirming care, and infertility-related treatments. The Federal Employees Dental and Vision Insurance Program (FEDVIP) will experience relatively low average premium rate increases of 1.4% for dental plans and 1.1% for vision plans in 2024.