Overview
Federal employees and retirees enrolled in the Federal Employees Health Benefits program will pay an average of 10.9% more toward health insurance premiums in 2027, according to the U.S. Office of Personnel Management.
OPM released 2027 plan options and premium rates ahead of the Federal Benefits Open Season, which runs from Nov. 9 through Dec. 14. Eligible employees and annuitants will be able to enroll, change plans or cancel coverage during the period.
The increase marks the third consecutive year of double-digit growth in the enrollee share of FEHB premiums. Participants paid an average of 12.3% more in 2026 and 13.5% more in 2025, following increases of 7.7% in 2024 and 8.7% in 2023.
Postal Service Health Benefits program enrollees face a smaller increase next year, although their costs are also rising. The average enrollee share of PSHB premiums will increase 8.2% in 2027, after gains of 12.3% in 2026 and 11.1% in 2025.
When the government’s contribution is included, total FEHB premiums are increasing 9.3%, while total PSHB premiums are rising 6.7%. Individual results differ substantially by plan, so some participants will see increases below the program average and others will pay more.
For most federal employees and annuitants, the government’s FEHB contribution is the lower of 72% of the program-wide weighted average premium or 75% of the premium for the selected plan. Enrollees pay the remaining amount.
OPM attributed the 2027 increase to higher costs for inpatient care, physician services, outpatient treatment, surgical services and prescription drugs, including GLP-1 medications. The agency said average premium growth has slowed compared with the previous two plan years.
“For the second year in a row, OPM has been able to reduce the average rate of premium increases for federal employees and annuitants,” OPM Associate Director for Healthcare and Insurance Matthew Kiley said. He said the agency is working on additional programs intended to maintain plan choice while limiting affordability pressures.
Dental and vision premiums rise more slowly
Premium increases in the Federal Employees Dental and Vision Insurance Program will be considerably smaller. Dental plan premiums will rise by an average of 1% in 2027, while vision premiums will increase by 1.6%.
The higher medical insurance costs arrive as President Donald Trump plans to freeze base and locality pay for most civilian federal employees in 2027. His alternative pay plan submitted to Congress in August states that most civilian pay rates will remain at 2026 levels, with exceptions for some groups.
William Shackelford, national president of the National Active and Retired Federal Employees Association, said the combination of higher premiums, a proposed pay freeze and workforce reductions would make federal employment less attractive. He also urged participants to compare available plans during Open Season rather than assume their existing coverage remains the most affordable option.
FEHB will offer 118 plan options from 45 carriers for 2027, while PSHB will have 65 options from 17 carriers.
Availability depends on an enrollee’s location and eligibility, so individual participants won’t necessarily have access to every plan listed nationally.
FEDVIP participants will have 21 dental plan options from 11 carriers and 10 vision options from five carriers. OPM has advised employees and retirees to compare premiums, benefits and their current coverage before the Dec. 14 Open Season deadline.
OPM sets 2027 health plan priorities
OPM’s 2027 guidance to FEHB and PSHB carriers places greater emphasis on preventive care and what the agency calls a well care model. The guidance covers obesity and weight management, vaccination policy, maternal health, behavioral health and other benefit areas as carriers prepare their 2027 offerings.
The agency is also reviewing whether FEHB and PSHB currently offer the appropriate number and types of plans. A Sept. 15 request for information asked carriers, participants and other interested parties for feedback on plan choice, premium costs, consumer experience and the operational effects of changing the number of available options.
OPM said the feedback could inform future decisions as it considers ways to provide more competitive plan choices. The FEHB program covers about 8.3 million federal employees, annuitants, eligible family members and other participants, according to the agency’s request for information.
Health data collection remains disputed
Separately, OPM is developing plans to collect claims-level information from FEHB and PSHB carriers as part of its efforts to identify fraud, waste and abuse and assess federal health plans. The proposal has drawn objections from some members of Congress over privacy, security and the amount of individual health information the agency would hold.
OPM revised its privacy notice in June and described administrative, technical and physical safeguards for the information. The agency said personally identifiable fields such as names, Social Security numbers, subscriber IDs and street addresses would be removed or pseudonymized, although other claims information would remain in the dataset.
OPM has said the information is intended to improve oversight and combat fraud, waste and abuse while protecting personally identifiable information. The dispute remains unresolved as federal employees and retirees prepare to select their 2027 coverage during Open Season.
