To carry your FEHB coverage into retirement, you must have been enrolled in the program for 5 consecutive years before you retire or from your first opportunity to enroll. Image: Hyejin Kang/Shutterstock.com
By: Reg JonesNo matter when you began planning for retirement, you need to check and see if you’ve covered all the bases. If your idea is to retire soon—for example, around the end of this year—it’s time to get going on them now. Here are a few of the key ones.
Creditable civilian service
Have you gotten credit for all your periods of civilian service before you became a federal employee (or even during a break in service). For example, have you been a Peace Corps or as a VISTA Volunteer, a Non-Appropriated Fund (NAF) Instrumentality employee, engaged in certain contract services or been employed by other contributory retirement systems, such as the Tennessee Valley Authority? If so, by making a deposit to the FERS or CSRS retirement system – or having contributions you made to the other system transferred over – your retirement annuity might be a lot bigger than you had expected.
To find out about these and other kinds of creditable service, go to https://www.opm.gov/retirement-services/publications-forms/csrsfers-handbook/c020.pdf.
Creditable military service
Have you gotten credit for any active duty service in the U.S. armed forces. If you served on active duty before or after you became a government employee, you can get credit for that time in determining your length of service. Depending on when that service occurred, you may or may not have to make a deposit to get credit for that time. To find out which situations would apply to you, go to https://www.opm.gov/retirement-services/publications-forms/csrsfers-handbook/c022.pdf.
Health insurance
Are you enrolled in the Federal Employee Health Benefits (FEHB) program? Most employees are. If you are one of them and are planning to retire, you need to be aware of the 5-year rule. To carry your FEHB coverage into retirement, you must have been enrolled in the program for 5 consecutive years before you retire or from your first opportunity to enroll (note: there is an exception for those retiring with an early retirement offer). If you meet the requirement, your coverage will continue and your premiums will be the same as they were when you were an employee.
If you retire but haven’t met that retirement, you’ll be given 31 days of coverage at no cost to you. After that you’ll have the option of continuing in that plan (or another plan of your choice) under the Temporary Continuation of Coverage (TCC) provision for up to 18 months. If you choose to do that, you’ll pay 100 percent of the premiums, plus 2 percent to cover the administration cost incurred by your agency. When that coverage ends, you’ll need to make other arrangements for your health insurance.
Life insurance
The 5-year or first opportunity to enroll requirements also applies to the Federal Employees’ Group Life Insurance (FEGLI) program. If you meet that requirement, your Basic coverage will continue at the same level you had when you retired, and it will stay at that level until the end of the calendar month that follows your 65th birthday. If you elect to let the level of coverage decline to 25 percent of its face value, you will no longer have to pay the premiums.
On the other hand, if you want to keep it at its full value (or elect a 50 percent reduction), you’ll have to continue paying the premiums for that level of coverage. Elections may also be made at retirement about any coverage you have under Options A, B, and C, all of which will be at your own expense.
If you aren’t eligible to carry your life insurance into retirement, you’ll receive a 31-day premium-free extension of coverage for your Basic insurance. You will also be offered an opportunity to enroll in a private sector plan for which you’d pay the entire premium.
Other insurance
There is no 5-year enrollment requirement for continuing coverage under the Federal Dental and Vision Insurance Program, and retirees further can newly enroll after retirement in any open season.
Under the Long-Term Care Insurance Program, coverage continues as long as you pay the premiums. In that program, retirees normally can apply to newly enroll as well, but there is a moratorium on all new enrollments through at least the end of 2024 pending a reexamination of that program’s finances.
Former head of retirement and insurance policy at the Office of Personnel Management, and longtime FEDweek contributor, Reg Jones is known throughout the federal workforce community as an authority on pay and benefits.
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