Expert's View

Over the last two weeks, I’ve written about the importance of attending a pre-retirement seminar, and focused on making sure that you are getting credit for all periods of employment, including those in the armed forces. This time I want to call your attention to another benefit that can be lost if you don’t watch out.

If you are like most federal employees, you are enrolled in the Federal Employees Health Benefits program. It’s one of the best benefits the federal government offers to its employees and, if you meet the requirement written in law, you can carry that coverage into retirement. Here’s the requirement: you must be enrolled in the FEHB program for the five consecutive years immediately preceding your retirement. Note: If you were enrolled in the FEHB program, had a break in service, and reenrolled when you returned, those periods would be considered to be consecutive.


However, there are three exceptions to the five-year requirement. First, if you are covered by your spouse’s FEHB enrollment. Second, if you enrolled in the FEHB program at your first opportunity and retire with fewer than five years of coverage. Third, if you accepted an early retirement opportunity and had fewer than five-years of coverage.

If you don’t meet the requirements to carry your FEHB enrollment into retirement, you’ll be given a 31-day extension of coverage at no cost to yourself. When that ends, you’ll have the option of continuing your coverage for up to 18-months under the temporary continuation of coverage provision of law. TCC allows you to keep your current coverage or change to another provider; however, it comes with a cost. You’d be required to pay 100 percent of the premiums, plus an additional 2 percent to cover administrative expenses.

Considering what health care costs these days, retiring without FEHB coverage would be a big mistake. So, unless you have another reliable source of health benefits coverage or are independently wealthy, don’t do it.