Federal Employees Health Benefits in Retirement

Federal Employees Health Benefits in Retirement

Many federal employees may be thinking about retirement as the year comes to a close. Some of you have probably even put in the paperwork already. If you’re in that position, it’s important to take into consideration whether or not you’ll be able to continue your Federal Employees Health Benefits (FEHB) coverage in retirement.

If you have been continuously enrolled in the FEHB program for five years immediately before retiring, or from your first chance to enroll in it, you can continue that coverage into retirement. You don’t have to have been enrolled in a specific plan for this time; it doesn’t matter if you changed plans each year. It only matters that you were enrolled for five years, or enrolled at your first opportunity, prior to retirement. Any time under Tricare can be counted towards this five-year requirement as long as you are enrolled in an FEHB plan when you retire. Coverage under a spouse’s enrollment also counts.

There is an exception to this five-year or first opportunity rule. OPM will waive this rule if you were covered by the FEHB continuously since the start date of your agency’s last statutory buyout authority, or OPM approved buyout and early out authority. This also applies if you take discontinued service retirement due to a RIF, directed reassignment, reclassification of your position to a lower grade, or the abolishment of your position.

If you retire under one of these conditions, your agency will include a memorandum with your retirement papers. This memorandum will state that your retirement meets the criteria for a pre-approved waiver of the FEHB five-year requirement.

If you do decide to retire without meeting the five-year requirement or waiver criteria, you will likely not qualify to have continued coverage into retirement. OPM does have the authority to grant individual waivers, but this happens very rarely. In order to get an individual waiver, your failure to meet the five-year requirement must be due to extremely exceptional circumstances. These circumstances would have to be so exceptional that it would be against good conscience to deny you coverage.

For more information regarding your own personal situation when it comes to FEHB, contact a local financial professional.