FEHB Health Insurance Rates to Rise 12.3% in 2026, Prompting Plan Reviews

Health insurance premiums under the Federal Employee Health Benefits (FEHB) program are set to increase by an average of 12.3% for 2026, marking the second consecutive year of significant hikes following a 13.5% rise in 2025. This trend requires federal employees and military veterans covered by FEHB to carefully evaluate their health insurance options during the 2026 open enrollment period, which closes on December 8, 2025. The National Active and Retired Federal Employees Association (NARFE) underscores the importance of reviewing plan choices promptly to avoid missing potential savings. The steep premium increases are driving many beneficiaries to reconsider their current plans; a recent NARFE survey found that only 50% of federal employees plan to retain their existing health coverage in 2026, a substantial drop from previous years. Given the complexity of comparing health plans, many have hesitated to reassess coverage, potentially leaving savings unclaimed. However, experts recommend exploring options with higher deductibles or out-of-pocket limits as a strategy to offset rising premium costs without sacrificing comprehensive coverage. Although FEHB plans vary, all are designed to cover most health conditions, so shifting to a plan with more cost-sharing could reduce premiums substantially. The changes may result in thousands of dollars in annual savings for some beneficiaries. Federal employees, retirees, and veterans should prioritize actions during the open enrollment window to optimize their health benefits amid the ongoing rate increases. Beyond FEHB, military retiree dental and vision plans under the Federal Employees Dental and Vision Insurance Program (FEDVIP) and other military health benefits such as Tricare may also experience changes, although at generally lower rate increases. Staying informed on these adjustments is crucial for effective benefits management and budgeting in the coming year.