Haris Ashley
Federal employees in the US have access to a variety of insurance options, including health, dental, vision, and life insurance. The Federal Employee Health Benefits (FEHB) Program is the largest employer-sponsored health benefits program in the country, currently covering nearly 8.3 million federal employees and dependents. While FEHB is touted as offering cheaper and better insurance than non-federal options, some federal employees have reported that the premiums are often higher than in the private sector. However, one advantage of FEHB is that it can be carried into retirement and offers a wide array of plans to choose from. In addition to FEHB, federal employees can also take advantage of the Federal Flexible Spending Account Program (FSAFEDS) and the Federal Long Term Care Insurance Program (FLTCIP).
| Characteristics | Values |
|---|---|
| Number of options | Many |
| Cost | Varies, but often higher than private sector employers |
| Cost-sharing | Employees typically share the cost of their health plan premium with the government |
| Cost savings | Could be substantial for older people |
| Flexibility | Employees can choose the option that best meets their medical and financial needs |
| Coverage in retirement | Yes, if carried for the last 5 years of the career |
| Additional benefits | Dental and vision care through FEDVIP |
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What You'll Learn
Federal Employee Health Benefits (FEHB) Program
The Federal Employee Health Benefits (FEHB) Program is an employer-sponsored health benefits program that was established in 1959 by an Act of Congress. It is the largest program of its kind, covering nearly 8.3 million federal employees and dependents. The program offers health insurance plans to federal employees, who typically share the cost of premiums with the government. Depending on the plan, employees may also have to pay deductibles, copayments, or coinsurance.
The FEHB Program provides federal employees, retirees, and their survivors with a wide selection of health plans to choose from. These include Consumer-Driven and High Deductible plans, which offer catastrophic risk protection with higher deductibles, health savings/reimbursable accounts, and lower premiums. There are also Fee-for-Service (FFS) plans, which may include Preferred Provider Organizations (PPOs) or Health Maintenance Organizations (HMOs), depending on the area serviced by the plan.
The specific benefits and coverage provided by each plan can vary. FEHB plan brochures outline what services and supplies are covered and the level of coverage provided. These brochures can be obtained from the health plans or an employee's human resources office. It is important for enrollees to carefully review these brochures to understand their health care coverage.
The FEHB Program also offers flexibility in certain situations to ensure that members receive their entitled benefits. For example, in the case of emergency admissions, fee-for-service carriers may be expected to relax their pre-certification requirements, and carriers may be expected to provide additional supplies of medications for backup in emergency situations.
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Federal Employees' Group Life Insurance (FEGLI) Program
The Federal Employees Group Life Insurance (FEGLI) Program was established on August 29, 1954, by the Federal Government. It is the largest group life insurance program in the world, covering over 4 million federal employees, retirees, and their family members. Most federal employees are eligible for FEGLI coverage.
FEGLI provides group term life insurance, which does not accumulate any cash value or paid-up value. It consists of Basic life insurance coverage and three additional options. New federal employees are typically automatically enrolled in Basic life insurance, with premiums deducted from their paychecks unless they choose to waive coverage. Basic insurance is a prerequisite for the three forms of optional insurance, which must be specifically elected by the employee.
The Office of Federal Employees' Group Life Insurance (OFEGLI) is a private entity contracted by the Federal Government to process and pay claims under the FEGLI Program. Employees can choose to waive Basic insurance coverage when they first become eligible or cancel it at a later date. Additionally, they can make FEGLI elections during Qualified Life Events or the rare FEGLI Open Seasons.
The Office of Personnel Management (OPM) has overall administrative responsibility for the FEGLI Program. While FEGLI does not build up cash value, it can provide financial peace of mind for loved ones in the event of unexpected death. FEGLI can help cover funeral costs and provide income replacement, ensuring that family members are financially secure.
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Federal Flexible Spending Account Program (FSAFEDS)
Federal employees may be eligible for a health insurance plan through the U.S. Office of Personnel Management’s Federal Employee Health Benefit program (FEHB). The FEHB program was established in 1959 by an Act of Congress and is the largest employer-sponsored health benefits program. The program currently covers nearly 8.3 million federal employees and dependents.
Eligible employees can also enroll in the Federal Flexible Spending Account Program (FSAFEDS) each year during the Federal Benefits Open Season (usually in November/December). FSAFEDS allows employees to save money for healthcare expenses with a Health Care or Limited Expense Health Care FSA. It also offers an account for families with young children or elder care expenses – the Dependent Care FSA. This account lets you set aside money to pay for your daycare expenses.
FSAFEDS is a program that allows employees (but not retirees) to contribute pre-tax salary to an account(s) that may be used to pay for out-of-pocket medical and dependent care expenses. Agencies in the executive branch and a few other agencies offer FSAFEDS, which is administered by OPM.
The minimum election for all accounts is $100, and carryover has been adopted for healthcare and limited expense healthcare FSAs. You will need to re-enroll each year to continue participating in FSAFEDS. Enrollment does not carry forward year to year.
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$17.75
Federal Employees Dental and Vision Insurance Program (FEDVIP)
The Federal Employees Dental and Vision Insurance Program (FEDVIP) is a program that provides dental and vision insurance to eligible federal and postal employees, retirees, and their eligible family members. This program was established under Section 715 of the National Defense Authorization Act for Fiscal Year 2017 (FY 2017 NDAA), Public Law 114-38, expanding FEDVIP eligibility to certain TRICARE-eligible individuals.
Eligible individuals can enroll in a dental and/or vision plan, with options for "Self Only", "Self Plus One", or "Self and Family" coverage. "Self and Family" coverage includes the enrollee's spouse and unmarried dependent children under a specified age, as well as stepchildren and foster children who live with the enrollee in a regular parent-child relationship. Under certain circumstances, coverage can be continued for older dependent children who meet specific criteria.
Enrollment in FEDVIP is available during the annual Federal Benefits Open Season, typically in November and December. It is important to note that eligibility for the Federal Employee Health Benefits (FEHB) Program is a prerequisite for enrolling in FEDVIP, although actual enrollment in FEHB is not mandatory. Annuitants are an exception, as they do not need to be eligible or enrolled in the FEHB Program to participate in FEDVIP.
FEDVIP allows for the group purchase of dental and vision insurance, resulting in competitive premiums and no pre-existing condition limitations. Premiums for enrolled federal and postal employees are conveniently withheld from their salaries on a pre-tax basis. This program offers flexibility and comprehensive coverage for dental and vision needs, ensuring that federal employees and their families have access to essential healthcare services.
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Cost of federal employee insurance
Federal employees in the US may be eligible for health insurance through the Federal Employee Health Benefit (FEHB) program, which was established in 1959 by an Act of Congress. The program currently covers nearly 8.3 million federal employees and dependents.
The FEHB program offers a wide selection of health plans, including Consumer-Driven and High Deductible plans, Fee-for-Service (FFS) plans, and Health Maintenance Organizations (HMO). Federal employees typically share the cost of their health plan premium with the government. The specific cost of insurance for federal employees depends on the plan chosen, with different plans offering varying levels of deductibles, copayments, or coinsurance.
All FEHB plans offer Self Only, Self Plus One, and Self and Family enrollment types. The enrollee share of premiums for the Self Plus One enrollment type may be higher than for the Self and Family enrollment type. For 2025, the biweekly program-wide weighted average premiums for Self Only, Self Plus One, and Self and Family enrollments with a government contribution are $414.00, $902.78, and $991.99, respectively. The monthly program-wide weighted average premiums for these enrollment types are $897.00, $1,956.02, and $2,149.31, respectively.
It is important to note that federal employees must still pay the employee share of health benefits premiums if they are on leave without pay for an entire pay period or if their pay during a pay period does not cover the full amount of withholdings due.
Additionally, federal employees should consider the potential impact of premium conversion on their Social Security benefits. While premium conversion may offer tax savings, it can also result in a slight reduction in Social Security benefits upon retirement.
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Frequently asked questions
Federal Employees Health Benefits (FEHB) is the largest employer-sponsored health benefits program. It was established in 1959 by an Act of Congress and currently covers nearly 8.3 million federal employees and dependents.
Federal employees have access to a wide variety of insurance options, including the FEHB Program, the Federal Employees’ Group Life Insurance (FEGLI) Program, and coverage for dental and vision through FEDVIP (Federal Employees Dental and Vision Insurance Program). FEHB offers a wider selection of health plans than most employers, allowing employees to choose the option that best meets their medical and financial needs.
Federal employees typically share the cost of their health plan premium with the Government. Depending on the plan, employees may also have to pay deductibles, copayments, or coinsurance. The best plan for you may depend on factors such as cost, coverage, and in-network providers.
Federal employee insurance offers more options than most employers, but it is not necessarily cheaper. While some people report that federal insurance is more expensive than private sector insurance, others note that the cost savings in retirement can be substantial.
If you are eligible for a plan from the FEHB program, you may enroll during the annual FEHB Open Season.
