What recent legislative or administrative proposals have aimed to restructure or rename major federal benefit programs in 2024–2025?
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Executive summary
House Republicans’ 2024–2025 budget and oversight actions have produced a package of proposals that would substantially restructure federal employee retirement and health benefits—changing contribution rates, benefit formulas and the structure of the Federal Employees Health Benefits Program—while administration proposals have focused on reshaping marketplaces and Medicaid coverage, not renaming core programs [1] [2] [3] [4]. Reporting shows the most concrete restructuring targets are FERS pension mechanics (contribution rates, “high‑5” annuity formula and elimination of the FERS supplement) and proposals to move FEHB toward vouchers or eligibility checks, and both camps frame their actions around cost control and program integrity [5] [2] [6] [1].
1. FERS under the knife: higher employee contributions and a “high‑5” annuity formula
Congressional proposals advanced by House Republicans would raise federal employees’ contribution rates to FERS to a uniform 4.4% and reverse prior decisions that kept some employees at lower contribution levels, shifting more payroll cost to current workers [1] [7]. The committee package also contemplates switching the annuity calculation from a highest‑three‑year average to a “high‑five” average for both FERS and CSRS retirees beginning in 2027—an actuarial change that would reduce initial annuity amounts for future retirees [5] [7].
2. Eliminating the FERS supplement and other targeted retiree rollbacks
Among the most pointed proposals is discontinuing the FERS annuity supplement for future retirees, a benefit designed to bridge income until Social Security eligibility; advocates warn this would particularly harm law enforcement and others who retire earlier, while proponents cast it as a long‑term cost saver [6] [2]. Committee reporting and stakeholder reactions show intense pushback from federal employee unions and some members of Congress, who argue these changes breach recruitment and retention promises and break the government’s bargain with workers [8] [9].
3. Restructuring FEHB: vouchers, enrollment checks and premium pressure
Legislative language and budget blueprint discussion have explicitly proposed altering FEHB through measures that could include vouchers that steer enrollees to lower‑cost plans and administrative rules to reduce improper payments and remove ineligible enrollees—moves framed by supporters as integrity and cost measures and criticized by unions as potential benefit erosion and higher out‑of‑pocket costs [1] [2] [9]. FEHB premium hikes in recent years—reported increases of roughly 8–13% in 2023–2025—are repeatedly cited by proponents as justification for structural change [1] [9].
4. Pay, performance and civil service protections: replacing across‑the‑board raises
The budget framework also contemplates broader compensation reforms beyond benefits, including ending across‑the‑board annual pay raises in favor of merit‑based increases and proposals seen as weakening civil‑service protections, which supporters say would improve efficiency and opponents say would politicize personnel systems [2] [9] [10]. Committee floor action has already moved multiple proposals through oversight channels, though some House Republicans signaled elements could be removed before final votes, and critics expect legal and political fights ahead [10].
5. Administration and other federal proposals: exchanges, Medicaid expansions and program tweaks
The Biden administration’s FY2025 budget and regulatory proposals took a different tack, seeking to extend enhanced ACA subsidies permanently and to create a federal “Medicaid‑like” option for residents of non‑expansion states rather than renaming core programs, while CMS rulemaking proposed technical changes to Marketplace user fees and special enrollment periods [4] [3]. Broader budget blueprints from GOP leadership target major entitlement restructuring and repeal of certain tax‑credit programs, but the publicly available documents cited focus on reform and repeal rather than explicit renaming of major benefit programs [11].
These reform efforts are mixed in scope and intent: House Republican proposals are concrete and concentrated on FERS and FEHB, widely contested by unions and some lawmakers as breaking commitments to federal workers [7] [8], while administration proposals emphasize expanding access and stabilizing marketplaces rather than structural renaming [4] [3]. Reporting limitations: available sources document proposals and committee actions through mid‑2025 but do not show final enacted law or definitive renaming of major federal benefit programs, so outcomes remain contingent on legislative negotiation and rulemaking [1] [10].