Unveiling the 2022 FEHB Premium Increase: A Comprehensive Guide

As the calendar year draws to a close, federal employees and retirees eagerly await news about the impending changes to the Federal Employees Health Benefits (FEHB) Program. This year, the U.S. Office of Personnel Management (OPM) has announced a modest 2.4% increase in the average total premiums for non-Postal employees and annuitants enrolled in FEHB plans for 2022. This marks the second-lowest premium increase in the past 24 years, providing much-needed relief amid the ongoing COVID-19 pandemic.

In this comprehensive guide, we’ll delve into the details of the 2022 FEHB premium increase, exploring its impact on various enrollee groups and the factors that contributed to this favorable outcome.

Understanding the FEHB Program

Before diving into the specifics of the 2022 premium increase, let’s briefly review the FEHB Program itself. Established in 1960, the FEHB Program is the world’s largest employer-sponsored health benefits program, providing healthcare coverage to approximately 8.2 million enrollees, including 2.2 million federal employees, 1.9 million annuitants, and an estimated 4.1 million family members.

The program offers a wide array of health plan choices, with 275 options available for 2022. OPM has encouraged FEHB carriers to prioritize COVID-19 response, mental health services, and substance use disorder treatment in response to the ongoing pandemic and the opioid epidemic.

The 2.4% Premium Increase: Breaking it Down

According to OPM’s announcement, the average total premiums for current non-Postal employees and annuitants enrolled in FEHB plans will increase by 2.4% for the 2022 plan year. This modest increase is significantly lower than the national average premium increase for employer-sponsored health insurance, which is projected to be around 6.5% in 2022, according to the Mercer National Survey of Employer-Sponsored Health Plans.

It’s important to note that the 2.4% increase is an average figure, and the actual premium changes may vary depending on the specific health plan and coverage option chosen by the enrollee. Some plans may see a higher or lower premium increase, while others may even experience a decrease.

To provide a clearer picture, let’s explore the premium changes for the various FEHB coverage options:

Self Only Coverage

For those enrolled in Self Only coverage, the average biweekly premium will increase from $109.56 in 2021 to $112.19 in 2022, representing an increase of $2.63 or 2.4%.

Self Plus One Coverage

Enrollees with Self Plus One coverage can expect an average biweekly premium increase from $236.74 in 2021 to $242.42 in 2022, reflecting an increase of $5.68 or 2.4%.

Self and Family Coverage

For those with Self and Family coverage, the average biweekly premium will rise from $260.61 in 2021 to $266.78 in 2022, an increase of $6.17 or 2.4%.

It’s worth noting that these figures represent averages, and individual plan premiums may vary based on factors such as the carrier, plan type, and coverage area.

Factors Contributing to the Moderate Premium Increase

The relatively low 2.4% premium increase for 2022 can be attributed to several factors, including:

1. Effective Negotiations: OPM worked closely with FEHB carriers to negotiate competitive rates and benefits for the 2022 plan year, ensuring that premium increases remained reasonable while maintaining high-quality coverage.

2. COVID-19 Response: Many FEHB carriers have implemented cost-saving measures related to COVID-19 testing, vaccinations, and telehealth services, which may have helped mitigate premium increases.

3. Mental Health and Substance Abuse Treatment: OPM’s emphasis on mental health and substance use disorder services has encouraged carriers to offer comprehensive coverage in these areas, potentially contributing to better overall health outcomes and cost savings.

4. Competitive Market: The FEHB Program operates in a highly competitive market, with numerous plan options vying for enrollees. This competition likely incentivized carriers to keep premium increases moderate to remain attractive to federal employees and retirees.

Exploring Additional Benefits and Changes

In addition to the modest premium increase, the 2022 FEHB Program will introduce several other noteworthy changes and benefits:

• COVID-19 Vaccination Incentives: Over 85% of FEHB enrollees will have access to incentives ranging from $25 to $100 for receiving a COVID-19 vaccination, encouraging widespread vaccine adoption.

• Expanded Eligibility: Over the past year, FEHB coverage eligibility has been extended to employees of eligible tribal schools. Approximately 31,823 tribal and tribal school employees from 132 tribes are currently enrolled in the program.

• FEDVIP Updates: Under the Federal Employees Dental and Vision Insurance Program (FEDVIP), the overall average premium for dental plans will increase by 0.81%, while the average premium for vision plans will rise by 0.95%.

• FSAFEDS Flexibilities: OPM has maximized additional flexibilities permitted by the CARES Act and additional legislation for pre-tax benefits offered under FSAFEDS (Federal Flexible Spending Account Program) in light of the COVID-19 pandemic, including a special enrollment period to make mid-year election changes.

Open Season and Plan Comparison Tools

The Federal Benefits Open Season, which runs from November 8 to December 13, 2021, provides federal employees, annuitants, and other eligible individuals the opportunity to review their FEHB and FEDVIP plan options, make changes, and enroll for the upcoming benefit year beginning January 1, 2022.

To assist in making informed decisions, OPM offers several resources, including the FEHB Plan Comparison Tool and the FEDVIP Plan Comparison Tool. These tools allow enrollees to compare plan features, benefits, and costs, enabling them to select the option that best suits their needs and budget.

Conclusion

The 2.4% increase in average total premiums for FEHB plans in 2022 represents a significant achievement for OPM and FEHB carriers, providing much-needed relief to federal employees and retirees amidst the ongoing challenges posed by the COVID-19 pandemic. By balancing comprehensive coverage with affordability, the FEHB Program continues to demonstrate its commitment to the well-being of its enrollees.

As the Open Season approaches, federal employees and annuitants are encouraged to carefully review their plan options, take advantage of the available comparison tools, and make informed decisions to ensure they have the right coverage for their unique healthcare needs and financial circumstances.