Federal Employees Facing Massive Price Hikes for Health Coverage Next Year

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WASHINGTON- Federal employees and retirees on average will pay 12.3 percent more for health insurance next year, creating additional financial hardship for a federal workforce already struggling with missed paychecks during a government shutdown, stagnant wages, additional layoff threats and attacks on their union rights.

The Office of Personnel Management announced the 2026 premiums for the Federal Employee Health Benefits Program on Thursday, stunning many federal employees with massive price spikes for health insurance plans around the country.

"Health care costs are rising faster than salaries, which means federal employees in every state will have less take-home pay to cover their monthly bills," said Doreen Greenwald, National President of the National Treasury Employees Union. "We urge the administration and Congress to do whatever it takes to bring down health care costs and make quality health coverage affordable for all Americans."

Next year's price hike is on top of the 13.5 percent average increase employees paid this year, the highest in more than two decades, which forced federal employees to pay more to keep their same insurance or shop for lower cost options that may have fewer benefits.

An employee's cost for a family plan will increase, on average, $38.81 per bi-weekly paycheck, to $342.87, depending on location and coverage choices.

Giving federal employees a fair pay increase would help them withstand higher health insurance premiums next year, which is why NTEU continues to push for an average 4.3 percent pay raise starting in January. The administration currently is planning an inadequate and below-market 1 percent average raise, unless Congress passes the Federal Adjustment of Income Rates (FAIR) Act instead. Federal employees on average earned 24.72 percent less in 2024 than workers in similar private sector jobs, according to government data released by the Federal Salary Council.

"Just as federal employees are locked out of work on unpaid furloughs or working without pay, now comes the news that providing health insurance for themselves and their families is going to become even more challenging," Greenwald said. "Affordable health insurance is a key factor in the federal government's ability to recruit and retain the skilled, nonpartisan public servants that are needed to keep our country running."

"NTEU encourages the employees we represent to comparison shop for the health insurance plan that best suits their needs," Greenwald said. "But as the nation's largest employer, the federal government should keep health insurance rates affordable so that employees aren't forced to sacrifice coverage in order to make ends meet."

NTEU represents employees in 38 federal agencies and offices.