Ask The Experts: Retirement

By Reg Jones

Minimum retirement age

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Q. My wife will be 50 in three years and will have 30 years of federal service under FERS. Can she retire with no penalty and keep her federal health benefits.

A. No, she cannot retire on an immediate annuity. The earliest she could do that would be when she reaches her minimum retirement age, which in her case would be 56 years and 6 months. The only way she could retire earlier than her MRA would be if her agency offered her an opportunity under the Voluntary Early Retirement Authority and she was at least age 50.

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Health care premiums

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Q. My ex-husband is retiring from the post office and right now he covers our 21-year-old daughter on his insurance plan. Will he still be able to keep himself and her covered with the same cost he is paying now, or will the cost be higher? Read the rest of this entry »

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Part time and health care

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Q. I have been permanent part time as a TSO with the TSA for approximately 10 years and have been enrolled in FERS and Blue Cross/Blue Shield for all of my employment. Will I be allowed to carry my health insurance into retirement when I retire at 62 or do you have to be full time? Read the rest of this entry »

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Adding husband to insurance

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Q. I work for the Federal Bureau of Prisons, and I will be mandatory in 2-1/2 years. I got married in December and my husband is covered by VA. If I add my husband to my health insurance during open season in 2014, will he be able to remain when I retire in January 2016? I’m wondering because he will not have been on my insurance for five years. Read the rest of this entry »

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Health care coverage

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Q. I am a federal employee, 66 years old, planning to retire Jan. 3. I now have full coverage under Blue Cross Blue Shield for me and my husband. I understand that when I retire, I must sign up for Medicare Part A, but I am not sure about part B. If I elect to take Medicare Part B, and have BCBS as my supplement, may I still purchase my prescriptions through CVS Care Mark after I retire? Can you tell me the monthly cost for my spouse and myself to continue with full coverage under BCBS? Read the rest of this entry »

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Retirement coverage

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Q. I plan to retire in approximately a year at age 55. I have been covered by my wife’s insurance and we thought that I could stop coverage with my wife in the next open enrollment and go on FEP, but they told me in my office that I had to have five years on FEP before I could have coverage upon retirement. Is this true? Why wasn’t this ever brought to my attention? Do I have any options? Read the rest of this entry »

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Health insurance

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Q. Regarding carrying health insurance into retirement at age 60 when one has had a break in service: I began full time with the federal government at age 30 in 2005 but would like to change careers in my mid-40s and become a science and math teacher.

I read that I need to have the last five years covered under FEHB to carry health insurance into retirement. Does this apply if I have fewer than 30 years of service? Can I become a teacher at 44, then return to federal service at 55 and expect to have health insurance at 60?

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Retirement and health insurance premiums

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Q. I am 65, have worked for USDA intermittently since 1965 (recurring and temporary in the early years) and have been in my present position with USDA-ARS since 1999. I plan to retire (in FERS) in two or three years. My insurance provider for more than 10 years has been Blue Cross/Blue Shield Federal Employee Program. I am signed up for Medicare Part A. My wife, several years younger than I, is a health provider in private practice. She and my two children (elementary school age) are now covered under the federal employee plan above. My understanding is they can remain covered by the plan when I retire (although some aspects of plan coverage change because of my enrollment in Medicare Part A). After retirement, can I continue to pay premiums (covering me and my family) of the same amount as I now pay? In other words, will the U.S. government continue to pay the same portion of the premium as it does now?

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Insurance comparison

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Q. My mother is a survivor of a retiree and has full medical coverage. She is 92 and in relatively good health, taking no medication to speak of and enjoying her daily routines. Her monthly medical insurance for Horizon Major Medical is now $451.66. Is this above or below what would be considered average for single seniors?

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Terminated before retirement

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Q. I was an air traffic controller. My Federal Aviation Administration hire date was Sept. 30, 1990. I was terminated March 8 — 261 days from being eligible for retirement because I lost my medical. My 50th birthday is Nov. 24. I have over 22 years of “good time” and five years of military time, which I bought back, for a total of 27 years of government service. The FAA says I can file for a disability retirement, but otherwise I am entitled to nothing. Can this be right? Even if I get the disability retirement, it will be less than what I would have received at age 50.

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Survivor annuity and insurance

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Q. I’m a 53-year-old CSRS employee with 34 years of service. I may have the option of an early-out in May. I would like to carry my Federal Employees Health Benefits into retirement. I will choose no survivor benefit, but I would like to have my wife keep my insurance after my death. Can I do this?

A. No, you can’t. To be eligible to continue her FEHB coverage, she would have to be covered by the self and family option when you die and be entitled to a survivor benefit. Note: You are required by law to provide a full survivor annuity to your spouse unless she agrees in a notarized writing to a lesser amount or none at all.

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Leaving federal service early

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Q. I am 51 years old and have 16 years of 6c time in federal law enforcement. I am also a veteran and bought back 11 years of active-duty time, bringing my total federal time to 27 years. I am considering leaving the government for a position with a private company. I want to make sure I understand what I would give up before I leave, and it is my understanding that my benefits would be based on a straight 1.0 percent per year vice 1.7 percent since I will not have completed 20 years of 6c time. I am not concerned about Social Security since I would be working anyway. Also, I will need to defer my benefits until age 60, with 26 years of service. I have also retired from the reserves, so I am not concerned about health insurance. So, by my estimates, I would be giving up 45 percent for 26 percent. Do I have this correct, or am I missing something?

A. Yes, you are correct. Note: If you had 27 years of service, you’d be giving up an annuity worth 41 percent (0.17 x your high-3 x 20 years of service = 34 percent) + 0.01 x your high-3 x 7 years of service = 7 percent) for one worth 27 percent (0.01 x your high-3 x 27 years of service = 27 percent).

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Retirement eligibility

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Q. I am 52 years old and have 22 years of federal employment. Can I retire? If so, how soon can I receive monthly payments, and how much would they be reduced by?  How would this affect my Social Security benefits later? Also, how would this affect my medical insurance?

A. Unless you are a special category employee, such as a law enforcement officer or a firefighter, you don’t meet the age and service requirements to retire.

For FERS employees, these are: age 62 with five years of service, 60 with 20, at your minimum retirement age (MRA) with 30, and at your MRA+10, but with a 5 percent-per-year age penalty for every year you are under age 62. Your MRA is 56.

There is an option. Because you have at least 20 years of service, you could resign and apply for a deferred annuity at age 60. After 31 days of free health benefits coverage, you’d be able to continue it for up to 18 months under the temporary continuation of coverage provision of law. However, you’d have to pay the entire premium plus 2 percent.

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Spousal health insurance

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Q. I am a federal retiree, and my husband is on my health insurance.

Will he be able to keep my health premium if I die before him?

A. Yes, if you elected a survivor benefit for him when you retired.

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After open season

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Q. I am a Postal Service employee with self-only heath insurance coverage. My 24-year-old daughter has had no health insurance during the past six months after she changed jobs. She is  now enrolled full time in college (her school does not offer health insurance). Now that the open season is over, can I still add her if I am agreeing to pay a “family” premium? Can the new Obama law that allows adding dependents ( up to 26 years of age) be applied even though the open season is over?

A. Unfortunately, no.

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Medicare Part B

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Q. I am a Bureau of Prisons retiree with GEHA health insurance. Should I enroll in Medicare B? I know I don’t have to enroll in Medicare B, but would like to know the pros and cons of not enrolling. It seems the only entity that would benefit from that enrollment would be GEHA, or whichever health plan I enroll in, as it would automatically be deemed secondary with Medicare Part B as the primary, thereby avoiding paying the full cost of whatever medical procedure I might receive. If I sign up for Medicare B, won’t I be paying twice for the same services? If that is the case, why would I even consider enrolling in Medicare Part B? Am I missing something here?

A. The best place to find the pluses and minuses of enrolling in Medicare Part B will be found at www.opm.gov/health/medicare/index.asp.

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Health insurance change

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Q. I am a 69-year-old female FERS retiree, covered under parts A and B of Medicare and Blue Cross/Blue Shield basic for federal employees. I also have my spouse insured on this plan. My spouse is a military retiree, so we have Tricare for Life, and he also has parts A and B of Medicare.

I would like to change to the less expensive BC/BS health insurance, but I want to keep the doctors we currently have. Is there a possibility I would have greater out-of-pocket expense with the standard BC/BS? I would like to take the difference in premiums and subscribe to a dental plan.

A. To find out if you’ll be able to keep the doctors you now have, you’d need to check with Blue Cross/Blue Shield. While there is a possibility that you would have greater out-of-pocket expenses with the lower-cost option, the only way to find out is to check with your plan and learn how that option handles claims from members who are covered by Medicare parts A and B.

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Health insurance payments in retirement

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Q. I am transitioning to part time from a full-time position. I plan to continue to work 0.6 FTE from age 53 until age 60, when I would like to retire. I will have 20 years and nine months at age 60. At what percentage will I pay the premium for my health insurance in retirement?

A. You will pay the same premiums as all other employees and retirees.

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SF 52

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Q. I have been reassigned to a position in Atlanta from Albuquerque, N.M. This move is permanent. Do I need a SF 52 prepared to change my duty station and locality pay? Do I need a SF 52 to change my taxes and health insurance? This position is considered virtual.

A. All personnel actions must be documented with a Standard Form 52. It will record where you are now, your new duty station and the rate of pay at each. There is no place on the SF 52 to record changes in taxes or health insurance. When your official personnel folder is transferred to your new duty station, whatever you have already designated as your tax deductions and FEHB plan coverage will continue as is. Any change in your tax deductions will have to be made through your new payroll office. Your FEHB enrollment can be changed during the open season, if you want to do that.

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Military buyback

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Q. I was active-duty Navy (1980-84), then active Coast Guard (1991-2000). I received a tentative offer for employment with Army a few weeks ago (I’ve been a contractor since 2000). All required documents are submitted. Now I wait.

How do I buy my 13 years active duty into FERS? Can I use my existing 401(k) to pay this? How much would it cost me?

I also found out that, as of Jan. 1, the deduction for retirement went up to 3.1 percent. I guess a tentative offer before Dec. 31 doesn’t count for hired, so my pay is decreased. Adding on an increase in the cost of living (D.C. area), increase of health care coverage, retirement, Thrift Savings Plan, Social Security and decrease from my current salary, there’s not much of a paycheck left. What are the benefits of government employment? Any idea why Fort Belvoir does not have a cost-of-living adjustment?

A. Yes, you will be able to make a deposit to get credit for either or both your periods of active-duty service. When you are hired, your personnel office can explain how you do that and what it would cost. While you can use any source of money to make the deposit, I don’t know what the tax consequences of using your 401(k) would be.

The fact that you were made an offer of employment before the change in retirement deductions went into affect won’t change the fact that you’ll be required to pay the higher amount.

Your question about COLAs and Fort Belvoir makes no sense. Employees don’t receive COLAs, only retirees. And whatever COLAs one retiree gets are applied to the annuities of all eligible retirees. On the other hand, if you are referring to annual pay increases, these have been frozen for all employees for the past few years.

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