Happy New Year. This year is the 250th anniversary of our Nation’s independence. The FEHBlog resolves to keep posting as the 20th anniversary of the FEHBlog also occurs in 2026.

From Washington, DC,

• Federal News Network reports,
  • “The Office of Personnel Management is addressing what have become growing concerns in Congress over the significant delays in federal retirement processing this year.
  • “In a letter sent Tuesday [December 30] to a group of House Democrats, OPM Director Scott Kupor touted the benefits of the new online retirement application (ORA) in helping to streamline processing, while at the same time arguing that outdated systems — not staffing levels — are to blame for the current challenges HR employees are facing.
  • “The main issues with federal HR, we have found, are not low staffing levels, but inefficient and outdated technology and antiquated, cumbersome regulations and processes,” Kupor wrote in the Dec. 30 letter, obtained by Federal News Network. “OPM under the Trump administration has done in a matter of months what the government failed to do for multiple generations: modernize the paper-based federal retirement system.”
  • “Kupor’s comments are a response to a Dec. 22 letter from Democrats on the Oversight and Government Reform Committee, which raised concerns about the significant delays retiring federal employees are currently experiencing. Those delays are largely due to a surge of retirement applications from employees who opted into the deferred resignation program (DRP) earlier this year.”
• FEHBlog Observation: A related solution would be to simplify the highly complex retirement programs.

• An OPM news release describes the agency’s other accomplishments in 2025.

• Beckers Payer Issues identifies major federal and state healthcare policies that first take effect in 2026. The FEHB is hoping for significant deregulation of the FEHB and PSHB Programs which is the surest path to lower premiums and better competition.

• Fedweek tells us,
  • “The 2026 general schedule pay raise as usual will take effect not at the start of the year but rather as of the first full pay period of the year—January 11-24 for most—and its impact won’t be seen in pay distributions until the one covering that pay period, which in most cases will be made about a week to 10 days after its end.
  • “The raise of 1 percent across the board for most, although 3.8 percent for certain law enforcement positions (pending an OPM review), also as usual will have an effect on pay caps and certain benefits.
  • “The GS pay cap is increasing from $195,200 to $197,200. That cap affects employees in the upper steps of GS-15 in about half of the GS localities, and the upper steps of GS-14 in the highest paid, the San Francisco-Oakland locality.”
• FEHBlog observation — FEHB Open Season changes for annuitants take effect on January 1, 2026, while Open Season changes for employees takes effect on the first day of the first pay period of 2026, which is January 11, 2026. Open Season changes in the Postal Service Health Benefits program for all enrollees take effect on January 1, 2026.

From the judicial front,

• Beckers Payer Issues reports,
  • “Health Care Service Corp.’s Blue Cross and Blue Shield of Texas filed a lawsuit against medical billing company Zotec Partners Dec. 18, alleging “abuse” of the No Surprises Act’s independent dispute resolution process, according to filings from the Eastern District of Texas’ federal court.
  • “The No Surprises Act aims to limit surprise billing, forming the resolution process to address payment disputes between insurance companies and out-of-network providers.
  • “BCBS of Texas accused Zotec of knowingly instigating “thousands” of disputes that were not eligible for arbitration, such as by submitting false information. The insurer said Zotec sometimes ignored state law, timelines for the IDR process and eligibility parameters for claims. “Batching” — or bundling multiple claims into one IDR process — has been another concern, with BCBS of Texas saying Zotec “overwhelms” the insurer by including 66 unique items or services on average.
  • “The complaint requested compensation and a court order that would block Zotec from launching ineligible cases going forward.”

From the U.S. healthcare business front,

• Beckers Payer Issues reports,
  • “Alabama insurers issued the highest amount of medical loss ratio rebates to consumers in 2024, according to KFF.
  • “Under the ACA, if an insurer in the individual market spends less than 80% of premium revenues on clinical services and quality improvement, it is required to provide a rebate to customers, based on a 3-year average.”

• Beckers Hospital Review points out,
  • “Cross-market mergers — transactions between health systems operating in separate geographic regions — are becoming a more prominent trend in hospital consolidation as organizations continue to shift toward multiregion operating models.
  • “Over the past year, several large systems have pursued cross-market deals to gain scale, diversify risk and strengthen payer negotiations, often in lieu of same-market mergers that face heightened antitrust scrutiny. 
  • “While these transactions typically do not eliminate local competition for patients, they are reshaping how health systems think about growth, leverage and long-term sustainability.”

• MedCity News adds,
  • “Workforce pressures remained the dominant financial challenge for hospitals and health systems in 2025, according to data released this month by Kaufman Hall.
  • “Labor is still the largest expense for hospitals, with about 70% of organizations pursuing widespread efforts focused on staffing optimization.
  • “The interesting trend within the workforce setting is that more than half [of hospitals] are looking at the potential outsourcing of non-core activities. This has always been a trend in healthcare, but it seems to be increasing as people look to improve some of the non-core competencies, such as food service, revenue cycle, HR, etc.,” said Lance Robinson, managing director at Kaufman Hall.” * * *
  • “Beyond pay, hospitals are rethinking care models, Robinson added. They are placing more of an emphasis on team-based staffing, as well as investing in technologies like ambient AI to reduce administrative burden and help clinicians work at the top of their license.”