FEHB Premiums Are Up—Here’s What You Can Do Without Losing Coverage

Missy E
November 14, 2025

Key Takeaways

FEHB premiums have increased by an average of 11.2% for 2025, with enrollees experiencing a 13.5% rise. Retirees need to adjust their healthcare strategies to manage these higher costs.
You can explore options like changing FEHB plans, coordinating coverage with Medicare, or utilizing Health Savings Accounts (HSAs) to maintain coverage without overspending.

Understanding the 2025 FEHB Premium Hike

The Federal Employees Health Benefits (FEHB) program saw a notable premium increase

for 2025. With the average premium rising by 11.2% and enrollees facing a 13.5% increase, it’s essential to understand why these changes occurred and what you can do about them.

Several factors contribute to these premium hikes, including rising healthcare costs, increased utilization of medical services, and broader changes within the insurance market. Additionally, demographic shifts and higher demand for comprehensive healthcare services place further strain on the system. As a retiree relying on FEHB, you might feel the financial strain even more, especially if your income remains fixed.

Beyond general medical inflation, evolving technologies, new prescription drugs, and updated medical procedures contribute to increased costs. Insurance providers adjust their premiums to reflect these advancements, which means that retirees face new financial challenges each year.

Reviewing Your FEHB Plan Options

If your premiums are stretching your budget, you’re not stuck with your current plan. Open Season, which runs from November to December each year, gives you the chance to review and change your FEHB coverage. During this period, you can compare plans to find one that better suits your healthcare needs and budget.

What to Consider When Changing Plans

Coverage Needs: Assess your current medical needs and any anticipated changes for the upcoming year. Consider ongoing treatments, specialist visits, or new medical conditions that may arise.
Cost-Sharing Requirements: Compare deductibles, coinsurance, and copayments between plans. Some plans offer more predictable costs with higher premiums, while others feature lower premiums but higher out-of-pocket expenses.
Provider Networks: Ensure your preferred doctors and specialists are covered under any new plan. Research whether a new plan includes facilities you may need in the future.
Prescription Coverage: Evaluate how different plans handle prescription costs, especially if you take regular medications. Check if preferred pharmacies or mail-order options can save you money.

Thoroughly reviewing these aspects allows you to choose a plan that aligns with your financial and healthcare needs. Making informed decisions during Open Season is key to ensuring you remain covered without paying more than necessary.

Coordinating FEHB with Medicare

If you are Medicare-eligible, coordinating your FEHB coverage with Medicare can help manage costs more effectively. For retirees enrolled in Medicare Parts A and B, some FEHB plans offer additional benefits, like reduced deductibles or copayments.

Benefits of Coordination

Lower Out-of-Pocket Costs: Medicare can help cover what FEHB doesn’t, particularly when it comes to inpatient hospital care. Coordinating your benefits ensures fewer gaps in coverage and may reduce unexpected medical expenses.
Improved Prescription Coverage: With Medicare Part D integrated into some FEHB plans, your medication costs may be reduced. In 2025, Medicare Part D offers a $2,000 annual out-of-pocket cap, providing additional financial protection for those with high prescription drug costs.
Greater Flexibility: By combining coverage, you can access a broader network of healthcare providers. Medicare’s extensive network complements the FEHB network, allowing you to seek care from specialists who may not be covered by one program alone.

Understanding the nuances of FEHB and Medicare coordination can make a significant difference in your overall healthcare experience. By working together, these programs provide a safety net that minimizes your financial burden.

Exploring Health Savings Accounts (HSAs)

If you’re enrolled in a high-deductible health plan (HDHP), you may be eligible to contribute to a Health Savings Account (HSA). In 2025, the maximum contribution limits for HSAs are $4,300 for individuals and $8,550 for families. This tax-advantaged account allows you to save for qualified medical expenses, making it an excellent tool for offsetting higher premiums.

Why HSAs Are Worth Considering

Tax Benefits: Contributions, earnings, and withdrawals for qualified expenses are all tax-free. This provides a powerful incentive for those looking to save effectively for their healthcare needs.
Long-Term Savings: Funds roll over year to year, providing financial security for future healthcare costs. Unlike Flexible Spending Accounts (FSAs), unused funds are not forfeited at the end of the year.
Flexibility: Use HSA funds for various medical expenses, including deductibles, copayments, and prescriptions. Additionally, you can use your HSA to pay for Medicare premiums, long-term care insurance, and even some non-medical expenses after age 65 without penalties.

Using HSAs to mitigate premium increases can be a practical approach, especially if you plan to maintain an HDHP long-term. The ability to save and invest HSA funds over time creates a cushion that can help offset rising healthcare costs.

Taking Advantage of Open Season

Open Season, occurring from November to December, is your opportunity to make changes to your FEHB plan without restriction. Whether you’re switching plans or adjusting your coverage levels, this period ensures you have the flexibility to adapt to rising premiums.

How to Make the Most of Open Season

Compare Plans Thoroughly: Use OPM’s comparison tools to weigh different options based on cost, coverage, and benefits. Spend extra time reviewing new plans or plans that have undergone significant changes.
Consider Your Healthcare Needs: Project your medical needs for the upcoming year to select a plan that aligns with those expectations. Ensure your plan covers essential services, especially if you anticipate major health events.
Factor in Medicare Coordination: If applicable, consider how your FEHB plan works alongside Medicare. Assess whether your current plan offers cost-sharing benefits that complement your Medicare coverage.

Making Informed Decisions for 2025 and Beyond

As FEHB premiums continue to rise, it’s crucial to be proactive about managing your coverage. Reviewing your plan during Open Season, coordinating with Medicare, and utilizing HSAs are all strategies you can use to keep costs manageable.

If you’re feeling uncertain about your options, consider reaching out to a licensed agent listed on this website for professional advice. They can help you make the best decisions based on your unique healthcare needs.