The FED Weekly

(Ep 68) The FED Weekly 13-19 Sep 2026
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[00:00:00] Welcome and Overview
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Welcome to The FED Weekly for 13-19 September 2026, your essential weekly briefing on the policies and proposals shaping your career, your benefits, and your retirement. Whether you’re a current federal employee navigating changes in the civil service or a retiree keeping a close watch on your hard-earned pension and healthcare, this is your source for the latest news from Capitol Hill and the executive branch.

Each week, we cut through the noise to bring you the critical updates on budget negotiations, pay raises, workforce policies, and the legislative battles that directly impact the federal community. Let's get you up to speed on what happened this past week.

[00:00:44]  Issues That Affect Current and Retired Federal Workers
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Issues That Affect Current and Retired Federal Workers

[00:00:48] FEHB Plan Choices Review
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We begin with an issue affecting millions of current employees, retirees, Postal Service employees, and their families. On 15 September 2026, OPM published a formal request for [00:01:00] information titled “Federal Employees Health Benefits Program: Optimizing FEHB Plan Offerings.” This is not a final rule, and it does not change your health insurance options for the upcoming 2027 plan year. Instead, OPM is asking a much broader question about the future structure of the Federal Employees Health Benefits Program and the Postal Service Health Benefits Program:

Should federal employees and retirees have more health-plan choices, fewer choices, or different kinds of choices? Current federal regulations generally allow an FEHB carrier to offer three plan options, or two options plus a high-deductible health plan. OPM is now asking whether that structure still makes sense. The scale of the program makes this consequential. Approximately 8.3 million people are covered by FEHB, including current employees, retirees, family members, former spouses, and certain other eligible groups.

For plan year 2026, OPM says [00:02:00] FEHB includes 132 plan options from 47 carriers. The Postal Service Health Benefits Program has 75 plan options from 17 carriers. OPM is particularly interested in whether changing the number or types of available options could help control premiums and health-care costs. The agency is asking whether more choices could increase competition, whether fewer choices could simplify decision-making, whether additional high-deductible plans could encourage consumers to shop for lower-cost care, and whether different plan structures might affect when people seek medical treatment.

There is also a practical question familiar to anyone who has compared FEHB plans during Open Season. At what point does choice become complexity? OPM noted that its 2023 Federal Employee Benefits Survey found very strong support for FEHB overall. Ninety percent of respondents considered the availability of [00:03:00] FEHB extremely important or important, and 94 percent said the program met their needs to a great or moderate extent.

But only 66 percent rated FEHB as an excellent or good value. That gap helps explain why OPM is examining the structure of the program. The agency is also asking whether existing plan-comparison tools, payroll systems, agency benefits officers, and human-resources systems could realistically support a larger number or different mix of options. For retirees, OPM specifically asks whether changing plan choices might affect annuitants differently from active employees.

Again, nothing changes today. This is an information-gathering process that could eventually lead to proposed regulations. Public comments are due by 16 November 2026. And for anyone preparing for this year's Federal Benefits Open Season, remember that the Open Season rules and plan choices for 2027 are not being [00:04:00] changed by this request for information.

[00:04:02] Deferred Resignation Cost
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The Deferred Resignation Program returns to The FED Weekly this week, but for a genuinely new reason. On 15 September 2026, the Government Accountability Office released a major report examining federal agencies' use of paid administrative leave. GAO found that agencies in its review spent an estimated 9.5 billion dollars in salary costs on paid administrative leave during 2025. That represented a 435 percent increase in administrative-leave usage compared with 2023.

The largest reason was the Deferred Resignation Program. GAO estimates approximately 6.7 billion dollars of the 2025 salary cost was associated with employees participating in deferred resignation. Regular listeners know we have previously discussed the number of employees who accepted deferred resignation and, more recently, whether agencies later replaced some of [00:05:00] those workers. This week's development is different.

We now have an independent congressional watchdog's estimate of what the paid-leave portion of the program cost. Under the Deferred Resignation Program, participating employees generally agreed to resign or retire while being placed on paid administrative leave for a period before separation. GAO calculated the 6.7-billion-dollar estimate using program assumptions and internal time-and-attendance data supplied by federal payroll providers.

But GAO also identified an important problem: federal administrative-leave data are not completely reliable. For example, agencies sometimes incorrectly reported holidays as administrative leave. GAO found administrative-leave reporting was dramatically higher during pay periods containing federal holidays, even though holidays should not be coded as administrative leave. OPM has issued guidance intended to correct that [00:06:00] problem.

GAO consequently cautioned that OPM does not know the precise cost of administrative leave associated with the government's workforce-reduction efforts. GAO made recommendations intended to improve OPM's data quality and transparency. For employees and retirees who participated in deferred resignation, this report does not change their separation agreements or retirement benefits. Its importance is broader.

The report provides Congress and taxpayers with the clearest independent accounting yet of one major cost associated with the government's 2025 workforce reductions. Issues That Affect Retired Federal Workers

[00:06:40] OPM Health Data Privacy
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For retirees, there was another health-benefits development this week separate from OPM's request for information about FEHB plan choices. On 16 September 2026, a group of senators renewed objections to OPM's effort to collect detailed health-claims information involving federal [00:07:00] employees, retirees, and family members. This issue has been developing for several months, but the new congressional letter brings it back into focus.

OPM has sought health and prescription-drug claims information from carriers participating in FEHB and the Postal Service Health Benefits Program. The data could ultimately encompass millions of covered individuals. OPM has said access to detailed claims information can help it administer federal health programs, identify trends, evaluate costs, and improve oversight. Critics are concerned about the amount of personally identifiable or potentially re-identifiable medical information that could be centralized within the federal government.

The senators' 16 September letter argues that even revised safeguards do not sufficiently address the privacy and cybersecurity risks. One particular concern involves retention. Lawmakers said OPM's approach could create decades of detailed medical-history information [00:08:00] involving employees, retirees, spouses, children, and other covered family members. For retirees, it is important to distinguish this dispute from your actual FEHB coverage.

The congressional objections do not mean FEHB has stopped processing claims, and they do not require retirees to change health plans. This is primarily a dispute over what claims-level information OPM itself should collect from participating insurance carriers, how long that information should be retained, and what privacy protections should apply. It is also separate from the new FEHB plan-options review we discussed in the first section.

So there are really two different OPM health-benefits stories developing simultaneously. One concerns what insurance choices FEHB and PSHB should offer. The other concerns what health data OPM should collect about the people enrolled in those programs. Both could eventually have significant implications for [00:09:00] federal retirees, and we will continue following them when material developments occur.

[00:09:05] COLA Update Timing
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No New 2027 COLA Number This Week. One quick clarification regarding the 2027 federal retiree cost-of-living adjustment. Episode 67 covered the August CPI-W release, giving us the second of the three inflation numbers used in the COLA calculation. There is no new CPI-W number this week, so we are not going to repeat that calculation. The final figure needed is September's CPI-W reading, scheduled for release on 14 October 2026. Once that number arrives, we can calculate the actual 2027 adjustment rather than continue estimating it.

[00:09:43]  Issues That Affect Current Federal Workers
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Issues That Affect Current Federal Workers

[00:09:46] Pooled Hiring Rule
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One of the week's most significant workforce rules was published on 15 September 2026. OPM issued an interim rule titled “Shared Certificates and Pooled Hiring Actions.” The rule becomes effective [00:10:00] 15 October 2026, and public comments are due by 16 November 2026. The basic idea is to reduce duplication in federal hiring. Traditionally, one agency may conduct a recruitment, evaluate hundreds or thousands of applicants, produce a certificate of qualified candidates, and hire one or several people.

Another agency needing employees in essentially the same occupation may then conduct another complete hiring action. OPM wants agencies to make greater use of shared candidate certificates. The new rule expands the ability of agencies to share certificates for both competitive-service and excepted-service positions. It also establishes a framework for OPM-led pooled hiring actions.

Under that system, OPM can conduct one hiring action for occupations needed by multiple agencies. Participating agencies can then make selections from that common pool rather than each agency starting from scratch. [00:11:00] OPM has established an ambitious government-wide objective. For fiscal year 2027, the agency's goal is for at least 60 percent of selections for new external competitive-service hires to come from shared certificates, including OPM-led pooled hiring actions.

Veterans' preference remains important under the new framework. The rule retains requirements involving preference-eligible veterans, including special pass-over protections for veterans with compensable service-connected disabilities of 30 percent or more. Applicants must also consent before their application information can be shared with agencies they did not originally apply to. For federal employees working in human resources, this could substantially change recruiting workflows.

For employees seeking promotions or new positions, it could mean that applying for one vacancy eventually makes you available to more than one federal agency when certificate-sharing [00:12:00] requirements are met. The larger goal is straightforward: hire faster while making the government's applicant pools reusable.

[00:12:08] Excepted Service Overhaul
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OPM followed that hiring rule with another significant proposal on 18 September 2026. The proposed rule, titled “Employment in the Excepted Service,” would rewrite portions of the regulations governing excepted-service hiring, Pathways Programs, administrative law judges, and several newer federal employment categories. Comments are due by 17 November 2026.

Among other things, the proposal formally incorporates Schedule Policy/Career and Schedule G into OPM's broader excepted-service regulations. Schedule Policy/Career covers certain career positions that are confidential, policy-determining, policymaking, or policy-advocating.

These remain career positions filled through merit-based procedures, but employees placed in Schedule Policy/Career do not have the same removal [00:13:00] protections that ordinarily apply to many competitive-service employees. Schedule G, by contrast, covers certain noncareer policymaking or policy-advocating positions normally expected to change with a presidential transition. The proposed rule would also simplify the traditional excepted-service system of employment lists and orders of consideration.

OPM says it intends to preserve statutory veterans' preference, qualification standards, compensable-injury restoration rights, and other legally required priority-placement protections. One provision worth watching involves the Pathways Programs. OPM proposes to clarify circumstances under which participants in Pathways programs could convert into Schedule Policy/Career positions.

Because this is a proposed rule, these newest changes have not taken effect. The public-comment period runs through 17 November 2026, after which OPM can review comments and determine whether to issue a [00:14:00] final regulation.

[00:14:01] USDA Relocation Stay
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USDA Relocations Are Now Temporarily Frozen

We have an important follow-up to Episode 67's Agriculture Department relocation story. Last week, we reported that U.S. District Judge Vince Chhabria had indicated that he intended to temporarily pause parts of USDA's reorganization while considering the unions' legal challenge. This week, that pause became an actual court order. On 14 September 2026, Judge Chhabria issued an administrative stay largely freezing affected USDA relocation deadlines through 2 October 2026.

The order prevents USDA from enforcing certain relocation deadlines or taking disciplinary action against affected employees for declining reassignment, failing to respond to reassignment notices, or refusing to relocate while the stay remains in effect. The order applies to specified USDA organizations, including components within Food and Nutrition, Research, [00:15:00] Education and Economics, the Forest Service, Foreign Agricultural Service, Rural Development, Farm Production and Conservation, the Office of General Counsel, and the Office of the Assistant Secretary for Civil Rights.

USDA's broader reorganization contemplates moving approximately 2,600 employees currently based in the Washington area to regional locations around the country. The temporary stay does not mean the unions have won the underlying lawsuit. The judge specifically issued the pause to give the court time to evaluate the request for a preliminary injunction and allow additional briefing. But for affected employees facing imminent relocation dates, the practical difference is substantial.

Deadlines that could have resulted in relocation, separation, or disciplinary consequences have now been temporarily frozen for covered employees. The next major question is what happens when the stay expires on 2 October [00:16:00] 2026.

[00:16:00] DHS Whistleblower Delays
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DHS Whistleblower Cases Are Taking Years to Resolve

Finally, the Government Accountability Office released a significant report on 17 September 2026 examining whistleblower-retaliation complaints at the Department of Homeland Security. GAO found that DHS whistleblowers can wait years for investigations. For the majority of the retaliation cases GAO reviewed, investigations took more than three years. And even after investigators substantiated retaliation, additional delays occurred.

DHS policy calls for the Secretary to decide whether and how to address a substantiated retaliation finding within approximately 30 days. GAO found some cases instead waited another four months to more than two years for a final decision. That matters because whistleblower protections depend not only on whether employees have a legal right to report wrongdoing, but also on whether the government can enforce [00:17:00] those protections within a reasonable period. An employee who experiences demotion, reassignment, termination, or other retaliation may suffer career and financial consequences long before the complaint is resolved.

GAO warned that these delays can undermine employee confidence in the whistleblower system itself. The watchdog issued recommendations intended to improve timeliness and oversight. For DHS employees, the report provides independent confirmation that lengthy retaliation investigations are a systemic problem rather than simply isolated cases. And for the wider federal workforce, it is another reminder that statutory whistleblower protections can be only as effective as the institutions responsible for enforcing them.

[00:17:46] Wrap Up and Takeaways
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And that’s a wrap on this week’s Federal Workforce Roundup. The landscape for federal employees and retirees is constantly shifting, with major decisions being made about everything from pay and job security to retirement [00:18:00] benefits and the very structure of the civil service. Staying informed is your best tool. Subscribe wherever you get your podcasts