How to Maintain Your FEHB after Retirement

Retired federal employees risk losing their FEHB coverage if they don’t satisfy specific requirements.

Yes, you heard correctly. Unfortunately, FEHB, your government health insurance, is not available to everyone after retirement.

It would be best if you were qualified. This article will explain how to qualify and guarantee that your spouse will be able to keep it when you pass away.

Possibility of Maintaining FEHB during Retirement

You must meet two major requirements to continue receiving FEHB after retirement.

1. Retire with immediate retirement

For the conventional FERS, this entails leaving the workforce with at least one of the following: 30 years of service at your MRA (minimum retirement age); 20 years of service at age 60; 5 years of service at age 62; or ten years of service at your MRA (MRA+10 Retirement).

2. You must have continuously received FEHB coverage for the five years before retirement.

What if the spouse also works for the government?

It doesn’t matter who is officially carrying the FEHB plan if your spouse is also a federal employee as long as you are protected by it for the five years before retirement.

Consider the scenario where you and your spouse are both federal employees and have a Self+One plan that covers both of you. If your spouse retires immediately, they may choose to continue receiving FEHB benefits into retirement on their own record.

However, when a spouse who is not a federal employee chooses to be on their health insurance, that is when folks get into difficulties. So simple, you rejoin FEHB in this scenario at least five years before retirement.

Then what if I have Tricare? A deviation from the “5-Year Rule.”

The five-year rule exempts those Tricare covers as long as you are FEHB-insured on the day of retirement; having Tricare can satisfy the five-year requirement.

For illustration, suppose you had Tricare for the five years before retirement but switched to FEHB in the final year of your retirement. Because your Tricare satisfied the 5-year requirement and you had FEHB at the time of retirement, you would be qualified to maintain it into retirement in this situation.

Giving Up FEHB to Support Your Spouse

Now that you’ve retired and successfully transferred your FEHB benefits, you want to ensure that your spouse may still get FEHB after you pass away.

It would be best if you chose a survivor benefit on your pension for your spouse as the only significant criterion. Therefore, following your death, your spouse won’t receive a survivor benefit or FEHB.

You can choose to receive the survivor benefit or not on your retirement application.

You and your spouse are set to go if you choose one of the first two of these three survivor-benefit options.

1. Full Survivor Benefits: If you die first, your spouse receives 50% of your pension for 10% of your retirement.

2. Partial Survivor Benefits: If you die first, your spouse receives 25% of your pension at the cost of 5% of your pension.

3. No Survivor Benefits: There is no expense to you, and your pension is forfeited upon death.

After I retire, can I still receive my health benefits?

If you satisfy all the requirements listed below, you may continue receiving your current health benefits plan.

How can family members be added?

You can add a new spouse or child after retiring anytime due to a life-change event, provided you are qualified and have completed your requirements. You can also change from a Self Only to a Self and Family plan during a Federal Benefits Open Season. FBOs typically lasts from early November until mid-December.

What Does FEHB cost in retirement?

When opposed to commercial health insurance, one benefit of having FEHB is that the cost of health insurance for federal employees remains the same after retirement. Therefore, you continue to have the government pay for some of your health insurance. This can result in significant savings on healthcare expenses, given that the FEHB covers 72–75% of the cost.

In comparison to private employment coverage, this has several benefits. Like the FEHB, a private employer will often cover a portion of your health benefit expenses while employed. However, you frequently cannot maintain your work health benefits if you retire from the private sector. Instead, you must switch to a private health insurance plan or Medicare if you’re old enough.

Contact Information:
Email: [email protected]
Phone: 8139269909

For over 30-years Joe Carreno of The Retirement Advantage has been a Federal Employee Retirement System specialist (FERS) as well as a Florida Retirement System specialist (FRS) independent advocate. An affiliate of PSRE (Public Sector Retirement Educators), a Federal Contractor & Registered Vendor to the Federal Government, also an affiliate of TSP Withdrawal Consultants.

We will help you understand your FERS & FRS Benefits, TSP & Florida D.R.O.P. withdrawal options in detail while recognizing & maximizing all concurrent alternatives available.

Our primary goal is to guide you into retirement with no regrets; safe, predictable, stable, for life. We look forward to visiting with you.

Not affiliated with the U.S. Federal Government, the State of Florida, or any government agency. The firm is not engaged in the practice of law or accounting. Always consult an attorney or tax professional regarding your specific legal or tax situation. Although we make great efforts to ensure the accuracy of the information contained herein we cannot guarantee all information is correct. Any comments regarding guarantees, safe and secure investments & guaranteed income streams or similar refer only to fixed insurance and annuity products. Fixed insurance and annuity product guarantees are subject to the claims‐paying ability of the issuing company. Annuities are long-term products of the insurance industry designed for retirement income. They contain some limitations, including possible withdrawal charges and a market value adjustment that could affect contract values. Annuities are not FDIC insured.

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