No small number of employees who are covered by the Civil Service Retirement System (CSRS) want to know if they will eligible for Medicare Part A and a Social Security benefit.
Here’s the short answer. Yes, they are eligible for Medicare Part A. Whether they are also eligible for a Social Security benefit depends. Let me explain.
Medicare Part A
If you were employed under CSRS on or after January 1, 1983, you are covered by Medicare Part A (hospital insurance) under the Medicare Qualified Government Employees (MQGE) provision of law. Taxes are deducted from your salary every pay period to buy Government Quarters of Coverage (GECQs). Once you have banked 40 quarters, you are qualified for that benefit when you meet one of the following requirements:
• are age 65 or older,
• entitled to a disability benefit for 24 months, or
• receiving regular dialysis or have had a transplant for treatment of End Stage Renal Disease
Medicare Part B (physicians and related services) is a different story: while eligible, you’d have to pay the monthly premium for that, just like everyone else who elects it. To fill out the alphabet, Part D (prescription drugs) also is voluntary and comes at the cost of a monthly premium; Part C is the term used for alternatives to the original Medicare fee-for-service structure.
Social Security Benefit
If you are a CSRS Offset or FERS employees, you are automatically covered by Social Security, and have deductions taken from your salary to pay for that benefit. If you are a CSRS employee, you aren’t because you haven’t. Therefore, any entitlement you have to a Social Security benefit will be based on non-federal employment that occurred before, during and/or after you became a CSRS employee.
I know because I am one of them. I paid into Social Security while in the armed forces and reserves, when teaching night school, and after retirement.
While only 40 credits are required to be entitled to a Social Security benefit (with the exceptions noted above), the more credits you have, the greater your benefit will be. However, as a CSRS employee, the downside of earning a Social Security benefit is that it will be affected by the windfall elimination provision.
The WEP reduces or eliminates your earned Social Security benefit if you 1) are receiving an annuity from a retirement system where you didn’t pay Social Security taxes (such as CSRS), and 2) have fewer than 30 years of “substantial” earnings under Social Security.
Substantial earnings are not the same as the earnings needed to earn Social Security credits. For example, to receive 1 credit in 2016, you’d only have to earn $1,260. For those earnings to be considered substantial, you’d have to earn $5,512.50. If you have fewer than 30 years’ worth, your Social Security benefit is reduced (although not eliminated; the maximum reduction currently is about $430 a month).
For detailed information about the WEP and how it works, go to www.ssa.gov/pubs/EN-05-10045.pdf.