What FEHB Actually Costs in 2026
OPM sets FEHB premiums each fall. For the 2026 plan year, the average enrollee share rose 12.3%, following a 13.5% increase in 2025.
| Enrollment Type | Average Enrollee Share (Biweekly) | Government Share (Biweekly, Maximum) | Total Average Premium (Biweekly) |
|---|
| Self Only | $188.32 | $324.76 | $472.89 |
| Self Plus One | $410.88 | $711.17 | $1,034.14 |
| Self and Family | $457.66 | $778.03 | $1,138.88 |
Annualized over 26 pay periods, the average Self Only enrollee pays roughly $4,896 in 2026, and the average Self and Family enrollee pays roughly $11,899. The government contributes on top of that, which is money a Marketplace enrollee simply does not receive.
The government contribution formula matters. You get either 72% of the weighted average premium for your enrollment type, or 75% of your specific plan's total premium, whichever is smaller. In monthly terms, the 2026 maximum government contribution is approximately $703.65 for Self Only, $1,540.87 for Self Plus One, and $1,685.73 for Self and Family. If you pick an expensive plan, you pay 100% of the amount above that cap. If you pick a cheap plan, the government covers 75% and you pay 25%.
Postal Service employees and annuitants are no longer in FEHB. They enroll in the Postal Service Health Benefits (PSHB) Program, which launched January 1, 2025 and works on the same premium-sharing structure with its own plan lineup and a Medicare Part B enrollment requirement for most annuitants.
What the Marketplace Costs in 2026
Two things changed for 2026, and both raised costs.
First, insurers filed a median premium increase of approximately 18% across the 312 carriers participating in the ACA Marketplaces, the largest jump in years.
Second, the enhanced premium tax credits created by the American Rescue Plan and extended by the Inflation Reduction Act expired on December 31, 2025. Congress did not renew them. That restored the original ACA subsidy structure, including the hard cutoff at 400% of the Federal Poverty Level.
Premium tax credit income limits for 2026 coverage, based on the 2025 poverty guidelines:
| Household Size | 100% FPL (Minimum for Subsidies) | 250% FPL | 400% FPL (Maximum for Subsidies) |
|---|
| 1 person | $15,650 | $39,125 | $62,600 |
| 2 people | $21,150 | $52,875 | $84,600 |
| 3 people | $26,650 | $66,625 | $106,600 |
| 4 people | $32,150 | $80,375 | $128,600 |
Earn one dollar above the 400% line and your subsidy drops to zero. Under the enhanced credits, that same household would have paid no more than 8.5% of income. In 2026, the maximum required contribution for those who do qualify rose to roughly 9.96% of income at the top of the range.
Why FEHB Eligibility Usually Blocks Marketplace Subsidies
This is the part that trips people up. You can always buy a Marketplace plan. Getting help paying for it is a different question.
Under the ACA, if you are eligible for employer coverage that meets the minimum value standard and is considered affordable, you cannot receive a premium tax credit. For 2026, employer coverage is affordable if your share of the lowest-cost self-only plan is 9.96% or less of household income.
Run the math on a federal salary. The average FEHB Self Only enrollee share is about $4,896 per year. To make that exceed 9.96% of household income, you would need household income under roughly $49,000, and most FEHB plans offer cheaper Self Only options than the average. In practice, the overwhelming majority of federal employees fail the unaffordability test, which means no subsidy, which means a Marketplace plan costs full price while FEHB costs about 30 cents on the dollar.
There is one meaningful exception. The IRS fixed the "family glitch" starting with the 2023 plan year. Family affordability is now measured against the cost of family coverage, not self-only coverage. If the FEHB family premium your agency charges exceeds 9.96% of household income, your spouse and children may qualify for subsidized Marketplace coverage even though you do not. You would keep Self Only FEHB and they would enroll separately. This is uncommon at typical federal salaries but worth checking for lower-graded employees with large families.
When the Marketplace Is the Better Choice
You left federal service without meeting the 5-year rule. To carry FEHB into retirement, you must have been enrolled in FEHB for the five years of service immediately before you retire, or for all service since your first opportunity to enroll, and you must be enrolled on your retirement date. Miss that and FEHB ends.
Your Temporary Continuation of Coverage is running out or costs too much. TCC lets you keep FEHB for up to 18 months after separation, but you pay 100% of the premium plus a 2% administrative fee. That means the full $472.89 biweekly for average Self Only coverage instead of $188.32. Losing that employer contribution is exactly the situation where a subsidized Marketplace plan can win, particularly if your income dropped after leaving the job.
You retired early and your income fell. A former federal employee living on savings or a modest annuity may land squarely in subsidy range. Compare the annuitant FEHB premium against a subsidized Silver plan before assuming FEHB is automatically cheaper.
You are a spouse or adult child with unaffordable family coverage. See the family glitch fix above.
You never had FEHB. Contractors, term employees who declined coverage, and family members of deceased annuitants who lost survivor coverage all fall here.
What FEHB Gives You That the Marketplace Does Not
Premiums do not rise with age. A 62 year old and a 27 year old in the same FEHB plan and enrollment category pay identical premiums. On the Marketplace, a 62 year old can be charged three times what a 21 year old pays for the same plan. This age-rating difference is the single biggest reason FEHB stays competitive for older enrollees even when subsidies are on the table.
The government contribution continues in retirement. This is rare. Most private employers drop retirees entirely or offer a stipend. Federal annuitants who meet the 5-year rule keep the same government share for life.
FEHB also coordinates with Medicare rather than competing with it. Many annuitants enroll in Medicare Part A and B and keep FEHB as secondary coverage, which usually eliminates most out of pocket costs. Marketplace plans are not designed to work this way, and you generally cannot claim premium tax credits once you are eligible for premium-free Medicare Part A.
How to Compare Your Own Numbers
Step 1: Find your actual FEHB premium. Do not use the average. Look up your specific plan and enrollment code on the OPM premium tables at opm.gov, or PSHB rates if you are Postal. Multiply the biweekly enrollee share by 26 for your annual cost.
Step 2: Test affordability. Divide the lowest-cost self-only FEHB option available to you by your household income. Above 9.96% means you may qualify for Marketplace subsidies. Below it means you almost certainly do not.
Step 3: If you have a family, run the family test separately. Divide the annual family enrollment premium by household income. Above 9.96% opens a subsidy path for your dependents.
Step 4: Price a Marketplace benchmark plan. Use HealthCare.gov or your state exchange to see the second-lowest-cost Silver plan for your ZIP code, ages, and income. That is the plan subsidies are calculated against.
Step 5: Compare total cost, not just premium. Add expected deductible and out of pocket maximum exposure to each. FEHB plans often carry lower deductibles than Bronze and Silver Marketplace plans at similar premium levels.
Step 6: Check the calendar. Federal Open Season for the 2027 plan year runs November 9 to December 14, 2026. Marketplace Open Enrollment generally runs November 1 through January 15, though some state exchanges use different dates. Losing FEHB coverage triggers a Marketplace Special Enrollment Period, typically 60 days from the loss.
Frequently Asked Questions
Can a federal employee drop FEHB and buy a Marketplace plan instead?
Yes, you can drop FEHB during Open Season or a qualifying life event and buy a Marketplace plan. But because FEHB is nearly always considered affordable minimum value coverage, you would pay the full unsubsidized Marketplace premium while forfeiting a government contribution worth roughly $8,400 per year for Self Only coverage. For almost everyone, that is a losing trade.
Does FEHB count as employer coverage for ACA purposes?
Yes. FEHB is minimum essential coverage that meets the minimum value standard. Eligibility for it, whether or not you actually enroll, is what blocks premium tax credit eligibility when the coverage is affordable.
What happens to my health coverage if I leave federal service before five years?
Your FEHB ends 31 days after separation, with a free extension of coverage during those 31 days. You can elect Temporary Continuation of Coverage for up to 18 months at 102% of the full premium, or use the loss of coverage as a Special Enrollment Period to buy a Marketplace plan. Compare both. TCC preserves your exact plan and network, while a subsidized Marketplace plan may cost far less if your income dropped.
Is FEHB cheaper than the Marketplace for retirees?
Usually, but not always. Federal annuitants keep the government contribution, which no Marketplace plan matches. However, an early retiree with income between 100% and 400% of the Federal Poverty Level may find a subsidized Silver plan competitive, especially in a low-cost rating area. Once you reach Medicare age, the comparison shifts to FEHB plus Medicare versus Medicare Advantage, and the Marketplace drops out entirely.
Did the 2026 subsidy changes affect FEHB?
Not directly. The expiration of enhanced premium tax credits changed Marketplace pricing, not FEHB. Indirectly, it widened the gap: Marketplace coverage got more expensive for many households in 2026 while FEHB kept its government contribution intact, making FEHB relatively more attractive than it was in 2024 or 2025.
Can my spouse be on the Marketplace while I stay on FEHB?
Yes. You can elect Self Only FEHB and your spouse can buy a Marketplace plan. Whether your spouse qualifies for a subsidy depends on the family affordability test: if the FEHB family premium exceeds 9.96% of household income in 2026, your spouse may be subsidy-eligible. If it does not, your spouse can still buy Marketplace coverage but pays full price.
What is the 5-year rule for FEHB?
You must be enrolled in FEHB, or covered as a family member, for the five years of service immediately preceding retirement, or for all service since your first opportunity to enroll if that is less than five years. You must also be enrolled on your retirement date. Time spent under Temporary Continuation of Coverage does not count toward the five years.
