FEHB Program

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The Federal Employees Health Benefits (FEHB) Program is the employer-sponsored federal group health insurance program that covers over 9 million federal civilian employees, retirees, former employees, and their families. The FEHB Program is voluntary and is financed through employee and employer contributions.

The hallmark of the FEHB Program is consumer choice and competition. Comprehensive prescription drug coverage, widely available at retail and mail-service pharmacies, is a key component of FEHBP’s benefit design. Most plans that participate in the FEHB Program competitively bid their drug benefit administration to PBMs. The FEHB Program model for pharmacy benefits has permitted PBMs, working with FEHBP carrier clients, to create broad and convenient access to prescription drugs and generate significant savings for health plans and enrollees. Just as they do for private-sector health plans and large employers, PBMs participating in FEHBP plans play a key role in negotiating price discounts from manufacturers and pharmacies in order to lower unit drug prices.


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