Shocking Changes to Penn's 2026-27 Health Plan: What Every Employee MUST Know NOW!

The University of Pennsylvania recently announced changes to its health plans for the 2026-27 academic year, affecting faculty, staff, and postdoctoral workers. These revisions, which will be implemented during the Open Enrollment period from April 20 to May 8, include new contribution amounts, an increase in deductibles, and additional voluntary benefit options.

According to a press release from Penn’s Division of Human Resources dated April 15, a new working spouse contribution of $100 per month will take effect on July 1. This policy applies when a spouse has access to group medical coverage through their employer but chooses to enroll in one of Penn’s medical plans. The contribution will be deducted on a pre-tax basis. Employees who cover a spouse under a Penn medical plan must either select or waive this contribution during Open Enrollment; failure to select an option will result in the contribution being applied automatically.

Concerns regarding these changes have already been raised. Sarah Shaw, a lead negotiator with District Council 47 of the American Federation of State, County, and Municipal Employees, referred to the introduction of the working spouse premium as a “big red flag.” Shaw noted that workers at the Penn Museum have filed a grievance related to these health benefit modifications, asserting that the University implemented these changes without allowing the union to negotiate.

The press release also specifies that deductibles for the health plan will rise by $125, a move Penn claims is necessary to manage increasing health care costs while still providing comprehensive coverage for its faculty, staff, and postdocs. In addition to these adjustments, the new plan will offer several voluntary benefits, including coverage for legal services, purchase financing, and pet wellness, which are now available to Penn employees.

Changes have also been announced for various Flexible Spending Accounts (FSAs). The maximum annual contribution for the Health Care Flexible Spending Account (HCFSA) will remain at $3,400, but the rollover amount will increase from $660 to $680. For the Health Savings Account (HSA), users can contribute up to $3,400 for individual coverage and up to $6,750 for family coverage. Notably, the maximum contribution for the Dependent Care Flexible Spending Account (DCFSA) will jump from $5,000 to $7,500, although the cap for highly compensated employees will stay at $2,500.

It's crucial to note that the Internal Revenue Service enforces a “use it or lose it” policy regarding DCFSA plans. Therefore, any funds not fully utilized within the plan year will be forfeited. Users of the DCFSA or HCFSA must “re-elect” their accounts to maintain coverage in the upcoming school year. If not re-elected, users will default to a $0 annual goal and will be unable to enroll until the next Open Enrollment period, barring a qualifying life event.

Additionally, while medical plan and Penn Dental Plan rates are set to increase, rates for the MetLife Dental Plan and vision plan will remain unchanged. For many Penn employees, these changes will prompt a careful reevaluation of their health care choices during the enrollment period.

As Penn moves forward with these policy adjustments, both faculty and union representatives will be closely monitoring the implications on employee well-being and financial stability. The challenges presented by rising health care costs continue to be a pressing issue for universities across the nation, making transparency and negotiation between institutions and their employees more crucial than ever.