Washington D.C. – Federal employees and retirees on average will pay 4.9 percent more for health insurance next year, an unfortunate financial hit for workers and around the country whose take-home pay will be reduced by the higher premiums.
Retirees will also see their budgets stretched to absorb this increase in premiums during a time when health concerns for older Americans, among the groups at a higher risk from coronavirus, have increased dramatically.
Federal Employee Health Benefit Program enrollees who purchase health insurance for themselves and their families will pay $286 more on average next year, according to data released Wednesday by the Office of Personnel Management.
Because the 4.9 percent increase is an average, some will see even larger increases depending on the type of plan they choose. OPM said that nearly 53 percent of FEHB enrollees will see an increase in premiums of between 5 percent and 10 percent.
“Federal employees once again will suffer another financial setback next year with the news that they will pay even more for health insurance in 2021,” NTEU National President Tony Reardon said. “As the largest employer-sponsored health insurance program in the country, OPM should use its leverage to control these spikes in premiums that are too often a shock to the paychecks of frontline workers.”
For employees who enroll in the nationwide Blue Cross and Blue Shield standard option, for example, the family coverage will cost them $300.12 per biweekly paycheck, an increase of $13.38. Over a year, the increase is $347.88.
OPM also reports that the employer’s share will increase 3 percent, for an overall average premium increase of 3.6 percent.
Open season for federal employees to re-enroll or change their health insurance for next year starts Nov. 9 and goes through Dec. 14.
“NTEU will continue to fight for ways to bring down health care premiums and educate our members on how to choose coverage that meets their families’ needs at the lowest cost possible,” Reardon said.
In addition to paying more for health insurance, many federal employees are already bracing for four months of paying double Social Security taxes because of the mandated deferral imposed on them from September through December of this year.
In one positive development, OPM is requiring that in 2021, all FEHB providers cover the costs of an FDA-approved coronavirus vaccine when it is made available, which means zero costs to employees.
NTEU represents about 150,000 employees at 33 federal agencies and departments.