Ask The Experts: Retirement

By Reg Jones

FERS annuity supplement and disability

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Q. I took early retirement from the Postal Service after being refused FERS disability. Since that time  I have been awarded full disability from both the Veteran Affairs Department (I am a disabled vet) and Social Security. I have now reached the minimum retirement age and received notice from the Office of Personnel Management that I will be receiving the FERS Annuity Supplement. Am I still qualified for this supplement even though I am receiving Social Security Disability? I don’t want to find out later that I am not and must pay it all back.

A. According to OPM, you will receive the special retirement supplement even though you will also be receiving a Social Security disability benefit. That wouldn’t be the case if you were receiving a disability annuity under FERS. FERS disability retirees aren’t eligible for the special retirement supplement.

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Retirement pay for VA physicians

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Q. Is the retirement pay annuity under FERS for physicians employed
full time by the Veterans Affairs Department  calculated using base pay plus market pay or base pay (GS system) only?

A.  Physicians comparability allowances are considered to be part of basic pay for retirement purposes.

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VA early buyout

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Q: Is the Veterans Administration having any early out/buyout in the near future?

A: Not there we’re aware of.

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Lump sum benefit

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Q. My father retired from the VA canteen cafeteria about 8-9 years ago, I believe. I believe at that time he retired with early retirement benefits instead of full benefits, since he retired early.  My question is that at the time he retired he was offered a lump sum of $25,000 and have his monthly retirement benefits decreased by $300 monthly, if he took the lump sum. But he decided at that time he did not want to take a lump sum, because he didn’t think it was wise, but now he would like to see if he can get a lump sum and still get a monthly retirement check, or just a lump sum, if it is the right amount?  Is this possible, or is this not what they mean on sites as “It’s your money, Get it when you need it the most?”

A  There was a time when a retiring employee could elect to have a refund of his retirement contributions and also receive an actuarially reduced annuity. Since then, the law was changed to permit that only for retiring employees with a life expectancy of less than two years. Unfortunately. there is no provision in law that would allow your father to receive both a lump sum and an annuity.

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Will insurance pay for private care, not VA?

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Q: I am a retired federal employee and currently have health care coverage under one of the Federal Employee Health Benefits plans. I recently found out that I have multiple myeloma. I am also a Vietnam veteran, and after learning of my diagnosis, I found out that any Vietnam veteran who served on the ground in Vietnam between 1962 and 1975 and later developed certain diseases, including multiple myeloma, is presumed to have been exposed to Agent Orange herbicide and would be entitled to free health care for those diseases through the Veterans Affairs Department health care system.

However, much of the information I have gathered concerning treatment of veterans at VA hospitals for multiple myeloma has not been encouraging. I have read that veterans often do not get the treatment they need in a timely manner. My preference would be to have the option to use my FEHB and receive my treatment from my private doctors and myeloma treatment centers rather than relying on VA. The treatment can become extremely expensive: According to the information I received from one of the private myeloma treatment centers, the average cost for a bone marrow stem cell transplant would be $350,000. The average cost for one of the medications used is $10,000 per month. Would the FEHB plans pay for treatment of a service-connected disability/disease so I could use private health care providers?

A: FEHB plans don’t cover services and supplies when a local, state or federal government agency directly or indirectly pays for them. You’d need to check with your current plan (or any other plan that you are considering) to find out if you have the option of declining the coverage provided by law in favor of using private doctors and hospitals.

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Title 38 and military service

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Q: I am a 58-year-old physician with 16 years of military service from 1978 to 1994. I am taking a job with the Veterans Affairs Department. In the benefits booklet I received, there is a note as follows: “Physicians and dentists covered under Title 38 provisions must complete 15 years of creditable service in order to use Physicians/Dentists Special Pay as basic pay in determining the high-3 average salary used in the computation of a [Federal Employees Retirement System] annuity. If I buy into FERS for my 16 years of military service, does this count toward “creditable service,” or is creditable service only the service performed working for the VA directly?

A: Making a deposit for your period of military service will not count toward the requirement to complete 15 years of covered service as a Title 38 physician.

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Social Security and VA disability benefits (updated)

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Q: I am a Vietnam veteran with a disability rated at 40 percent. I will be 64 in September and plan on drawing my Social Security retirement benefits at that time. Will either one of these government plans be affected by the other? Also, do I receive any extra credit in my Social Security earnings for the 16 quarters served on active duty from 1966 to 1969?

A: You will be able to receive both your Veterans Affairs Department disability pay and your Social Security benefit. Your Social Security benefit will be based on the number of credits you earned under Social Security and will be less than the full amount because you will not have reached your full retirement age when you begin drawing it. For periods of active-duty service from 1957 through 1967, extra credits will be added to your record for Social Security benefits. From 1968 through 2000, credits will be automatically added. After 2001, no extra credits are added. For the full story, go to “Military Service and Social Security” on the official Social Security website.

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Military time and retirement

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Q: I was retired medically from the Army with less than 20 years of service. My health improved enough for me to work at the U.S. Postal Service. I was then called back to active duty to complete my 20 years of service, serving an additional three years and eight months. I returned to the USPS in 2005. I retired from the Army with a military pension and Veterans Affairs Department disability of 50 percent. Can I still receive my military pension and VA disability and buy back only those years I returned to active duty to get credit for those years for federal retirement?

A: Because you are receiving military retired pay based on an active-duty career in the armed forces, your only option would be to make a deposit for all your periods of active duty service and, at retirement, waive your military retired pay.

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VA disability, Social Security and retirement

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Q: I am a Vietnam vet and plan to apply for disability with the Veterans Affairs Department based on one of the illnesses caused by Agent Orange. I was in the Army for two years. I also plan to retire under the Civil Service Retirement System with 37 years of service in about 10 months. I am also eligible for a small Social Security check. If VA grants my service-related disability will my CSRS or Social Security check be reduced by the amount of the VA disability payment?

A: No, neither payment would be reduced.

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Buying back military time

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Q: I am a firefighter under the Federal Employees Retirement System holding a secondary position with a service computation date of 2003. I retired from the Air Force after 20 years of military service. I have a number of questions.

  • Would it be prudent for me to buy back my military time, which would allow me to retire early from civil service?
  • If I do buy back my military time and retire, would I lose my military retirement check?
  • Part of my retirement is a 40 percent service-connected disability from the Veterans Affairs Department. The other half is from the Air Force. Do I lose my disability payment?
  • Would I gain or lose money by buying back the time?

A: If you were to make a deposit for your 20 years of active duty, you would also have to waive your military retired pay; however, your VA disability benefits would not be affected. That period of service would not count toward the 20 years of covered service needed for you to retire under the special provision for law enforcement officers, firefighters or air traffic controllers. It would instead count as regular FERS service, and when you finally retired, it would be calculated using the standard formula. Whether making a deposit for that time would be a prudent one is one for you to decide based on how much you’d need to deposit versus what you’d get in return.

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