Reg Jones Expert's View

Over the last two weeks, I’ve explained the five-year rule, which determines your eligibility to carry your FEHB coverage into retirement, and spelled out the circumstances under which that requirement may be waived. I’ve also explained how health benefits coverage continues unchanged into retirement, and how FEHB and Medicare interact. This time I want you to check the accuracy of another set of statements. Are they true, sometimes true, or false?

  1. If you add your spouse to your health benefits plan and die before he or she has been covered for five years, your spouse won’t be able to continue that coverage.
  2. If your spouse is covered by your plan and you die, your spouse has to be receiving a survivor annuity to continue his or her coverage.

The first statement is absolutely false. Regardless of when you add a spouse to your health benefits plan, he or she is automatically eligible to continue that coverage if you should die, even if your spouse has only been covered for one day. The five-year rule doesn’t apply as long as your spouse is covered under the Self and Family option of your plan.

On the other hand, statement two is absolutely true. In order for that coverage to continue, your survivor spouse must be receiving a survivor annuity. That’s not an issue if you were still employed when you died. The provision of a full survivor annuity is automatic. However, when you retire, you will have to make an election. Although the law requires that you provide a full survivor annuity to your spouse, with your spouse’s agreement in writing, you can elect a lesser amount or none at all. However, if you choose that latter course, your widow(er) would not be able to continue coverage in an FEHB plan, unless he or she had the right to do so by virtue of being a current federal employee or retiree.

Come back next week to learn if your FEHB premiums will be the same in retirement as they were when you were an employee.