House Bill Targets FERS Annuity Supplement and Adds New Filing Fees
May 29, 2025What Survived the House Vote—And Why It Matters
Last week the House advanced the “Big Beautiful Bill Act,” stripping out two headline-grabbing ideas—the move from a high-3 to a high-5 pension calculation and a hike in employee FERS contributions. Those edits drew sighs of relief, but four less-publicized provisions stayed in the bill. Ignoring them now could leave federal employees scrambling later.
FERS Annuity Supplement Disappears in 2028
Beginning in 2028, the popular bridge benefit that helps employees who retire before Social Security age would end for most feds. Only those already receiving the supplement—or covered by mandatory early-retirement rules such as law-enforcement officers and air-traffic controllers—would keep it. If you expect to rely on that extra income, revisit your retirement timeline soon. Early deposits into the Thrift Savings Plan or postponing separation by a single service year could plug the future gap.
New Hires Face an At-Will Trade-Off
The bill invites new employees to accept a lower FERS accrual rate in exchange for at-will status—meaning almost no due-process rights at removal. Accepting the bargain might look attractive today, but without appeal rights an adverse action could instantly erase any savings from reduced contributions. Mindful decision-making calls for zooming out: align your selection with long-term career stability, not just the promise of a slightly larger paycheck now.
A $350 MSPB Filing Fee Raises the Barrier to Justice
Employees already weigh the stress of litigation when challenging discipline. The proposed filing fee—though refundable if you win—creates an upfront hurdle, particularly for lower-graded workers. If this measure becomes law, agencies may bet that fewer employees will risk out-of-pocket costs, subtly tipping the scales in management’s favor.
OPM Audits and the Hidden Health-Insurance Risk
OPM would gain explicit authority to verify every dependent listed on your FEHB plan. In practice, documentation requests can arrive with tight response windows. Keeping marriage and birth records scanned and ready is a simple mindfulness practice: clear, organized records reduce anxiety and protect both coverage and credibility when audits strike.
What Happens Next—and How to Prepare
The Senate can still rewrite or reject any portion of the bill, but timing is short. If you could lose the Annuity Supplement or face the new MSPB fee, start budgeting scenarios now. Meanwhile, track each amendment instead of reacting to rumors. Southworth PC will continue translating legislative language into action steps. For concise updates in your inbox, join our free newsletter at FedLegalHelp.com/newsletter.
Legal Disclaimer: The information provided in this article is for informational purposes only and should not be construed as legal advice. While I am a federal employment attorney, this post does not create an attorney-client relationship. Every situation is unique, and legal outcomes depend on specific facts and circumstances.