Ask The Experts: Retirement

By Reg Jones

Health coverage for spouse after retiree dies

Bookmark and Share

Q. I am a retired foreign service officer and elected to keep my health insurance (Blue Cross/Blue Shield), for which I pay about $430 monthly. When I die, will my wife be able to continue with this coverage? At the same cost? Or less, as she’ll be the only one covered, as our kids are grown.

Read the rest of this entry »

Tags: , , ,

After open season

Bookmark and Share

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.

Tags: , , , , ,

FEHB and Tricare

Bookmark and Share

Q. My husband and I are both military retirees and have had Tricare for over 38 years. When my husband turned 65, he had to sign up for Medicare and take Part B to retain Tricare for Life. He also dropped off of the Federal Employees Health Benefits plan and then retired from his civilian federal government job and I changed to single coverage on FEHB under me (I am still working as a civilian federal employee).

I am considering retiring this year and want to know if I need to add him to my FEHB for him to have access to FEHB in the future if we need that. Do I need to put him on my FEHB next open season to retain this benefit in the future?

A. To retain FEHB coverage, he would need to be covered under your FEHB enrollment when you died. Since you can’t predict when that will happen, it would be wise to change your coverage from self-only to self and family while you are still healthy.

Tags: , , , , , , ,

Temporary loss of health coverage

Bookmark and Share

Q. I am a retired foreign service officer whose spouse is still an active federal employee working for an agency other than the State Department. To save money, we decided to move from one self-and-family policy under my name to separate self-only plans. I opted for a completely different carrier, while my wife chose to stay with the one we had had for six years.

We had not counted, however, on the fact that this year, there would be a nearly two-week gap between the time frame for changes for retirees and for active employees. The end result has been that my self-and-family coverage ended Dec. 31, but my wife’s self-only coverage will only begin with the start of a new pay period Jan. 13. I confirmed with my former carrier that, despite having a record of her new enrollment, there was nothing it could do to continue her coverage without some sort of code or certification from my wife’s agency or the Office of Personnel Management. State essentially confirmed this and added that it would only have been able to modify my wife’s action had she also worked for State. My wife’s agency, meanwhile, seems to have been caught flat-footed by this problem and, after initially pronouncing her out of luck, claims to be researching her situation and that of a few others similarly affected.

This sort of Catch-22 is quite frustrating, not to mention upsetting. Neither my wife nor I saw any information during the open season warning of this potential pitfall much less guidance on how to avoid it. I advised State human resources, when I filed my change, that my wife would drop from my coverage to obtain her own through her agency. She, however, did not do so since her agency’s online enrollment procedure did not seem to allow for that.

Can you please advise as to how this should have been handled and what sort of remedial action (OPM code, certification) is possible? My wife is in good health and could probably make it to the 13th without problem, but her lack of coverage during an emergency is worrying. She has also already had to postpone seeking an elective appointment and been declined insurance coverage for a prescription she rushed to have filled on the 31st. It is hard to believe that the Federal Employees Health Benefits plan regulations would not address such a gap, greater this year than in most, given the number of mixed marriages between active and retired feds.

A. What happened is unfortunate. However, I’m not aware of any action you could take that would change that.

Tags: , , , , , , ,

Health insurance change

Bookmark and Share

Q. If I change my health insurance to self-only (due to my wife having insurance through her company) and I retire next year, can I add her back to mine if she loses or changes jobs. I ask because it’s open season and I plan on retiring the end of May from the Postal Service. I have my minimum retirement age and 31 years, three of which are my military buyback.

A. As a retiree, you could change from self-only to self and family under Qualifying Life Event 2G. And you could do that from 31 days before through 60 days after her loss of coverage.

Tags: , , , , , , ,

Health insurance costs after retirement

Bookmark and Share

Q. If I take the $15,000 retirement incentive being offered now, (I have 25 years under FERS, am a Postal Service employee, and am 64 years old), will my Blue Cross premiums go up? If so, by how much? I now pay $81.68 a month.

Also, if I decide to get married, my family option now would be $203.61 a month. How much would these premiums be if I take the retirement incentive? I must make the decision by Dec. 3.

Is the FERS pension amount taxed? If so, is it taxed by income and Federal Insurance Contributions Act? My gross pension amount is $1,288 a month. How much, approximately, would be left over after taxes and health care subtractions?

A. The easiest way to compare the cost of your Blue Cross/Blue Shield Standard premiums is to show you the difference between what Postal Service and non-Postal Service employees will be paying in 2013.

A Postal Service employee would pay $64.71 every two weeks for self-only coverage and $152.92 for self and family. A non-Postal Service employee would pay $85.71 for self-only and $200.14 for self and family.

When a Postal Service employee retires, his health benefits premiums are the same as those for all other non-Postal Service employees and retirees. And they are paid on a monthly, rather than a biweekly basis. In 2013, the BC/BS monthly rate for retirees will be $186.14 (self-only) and $438.63 (self and family). To find out how your annuity would be taxed, go to www.irs.gov/pub/irs-pdf/p721.pdf, and read the Internal Revenue Service’s Tax Guide to U.S. Civil Service Retirement Benefits.

Tags: , , , , , , , , , ,

Health insurance coverage after retirement

Bookmark and Share

Q. I am a government employee, but my husband is working in the private sector. To date, we have been using my husband’s health insurance because it provides excellent coverage. However, my husband’s company does not provide health coverage after retirement. To that end, I plan to enroll in a Federal Employees Health Benefits program in December since my retirement date is five years away. (My husband is retiring in five years, as well.) Does my husband need to be covered on my program for five years, too? Or can I add him in the last year prior to my retirement?

A. No, he doesn’t have to be covered for five years, only covered by a self and family enrollment when you retire. However, you need to remember that if you were to die while covered by a self-only enrollment, he wouldn’t be eligible for coverage under FEHB.

Tags: , , , , , , , ,

Health care coverage

Bookmark and Share

Q. I retired from the federal government at age 55 with survivor benefits for my husband, who is eight years younger than I am. I will be eligible for Medicare on Dec. 1.  If I opt for the Medicare parts A and B, can I reduce the costs of Blue Cross/Blue Shield by going from family plan, which covers both of us, to the single plan for him only?

A. Not unless he is a federal employee or retiree and, as such, eligible to enroll on his own.

Tags: , , , , , , ,

RIF, FEHB and the five-year rule

Bookmark and Share

Q. I am an EAS employee in FERS with 23 years of service at age 63. I have been enrolled self-only in the Federal Employees Health Benefits plan for 4½ years. Should I be terminated through a reduction in force, would I still be able to carry my coverage into retirement although I am short of the five-year enrollment requirement. I understand that there are certain exemptions to the five-year rule. I did not plan to retire until I reached 65.

A. You’d receive a pre-approved waiver of the five-year requirement because you would meet the criteria: You were covered under the FEHB program continuously since the beginning of your agency’s latest statutory early retirement authority, and you retired before the ending date of that authority.

Tags: , , , , ,

FEHB and the five-year rule

Bookmark and Share

Q. Can I add my spouse to my insurance when I retire at 62? I am a federal employee who has had federal health insurance for five years. My spouse has not been on that plan. I was told I could add him as long as I had had the federal insurance for five years. Reading the rules now looks like he has to be enrolled for five years prior to my retirement.

A. While you cannot add your spouse to your Federal Employees Health Benefits plan when you retire, you can do that during any open season by changing from the self-only option to self and family. You are the one who has to be covered for five years to carry that coverage into retirement, not him.

Tags: , , , , , ,

Single vs. family plan

Bookmark and Share

Q. My husband is going to retire early next year. He will be 65. He has been paying for self plus family Blue Cross Blue Shield since he began working for the Defense Department (BSBC 105).  I am a federal FERS retiree who will not be 65 until 2013. We heard somewhere that it is not a good idea to do single BCBS but continue with the family plan even though it comes out cheaper. We also have Tricare as a secondary as my husband is a retired military officer. Please advise as to the pros and cons of single versus family plan federal BCBS.

A. Rather than argue the benefits of single versus family Federal Employees Health Benefits plan enrollment, let me tell you what many other couples with Tricare coverage are doing: They retain their entitlement to self and family FEHB coverage and suspend it while they are covered by Tricare. That allows them to re-enroll at a later date if necessary. Whether this approach would be good for you would depend on an evaluation of your medical needs both now and in the future.

Tags: , , , , , ,

Self plus one for FEHB?

Bookmark and Share

Q. Why doesn’t the Federal Employees Health Benefits program offer a self-plus-one option for health insurance like the Federal Employees Dental and Vision Insurance Program? The cost should not be the same for one plus a spouse as it is for a whole family. I would rather pay two self-only premiums than that for self plus family. The difference between self only and self plus family is staggering.

A. The FEHB law doesn’t provide for that option, and serious consideration has never been given to changing it.

Tags: , ,

Switching health plans

Bookmark and Share

Q: My wife and I are both CSRS retirees. During our active careers and up to this point in our retirement she has been covered under my family health plan. Now that our youngest son is in the Air Force we want to switch to two single plans. Is that possible? Do we have to do it during open season?

A: Yes, you can switch to two self only enrollments, but the only time you can do it is during the annual open season.

Tags: , , ,