FEHBP + Medicare Part B can be 'political insurance'

Wednesday - 11/23/2011, 5:59pm EST

By Jolie Lee
Federal News Radio

Federal employees turning 65 might be wondering: Do I get Medicare Part B coverage in addition to my federal health plan?

In the current environment of deficit-slashing on the Hill, having both may be "political insurance if Congress turns on one more fiercely than the other," said Walton Francis, editor of the Checkbook Guide to Health Plans for Federal Employees.

Both are entitlement programs but Congress could change either program, Francis said in an interview with Your Turn with Mike Causey.

In fact, he said, "The one program I'm sure will change in the future is Medicare. That's a big driver in the government's debt and deficit these days, and it's going to get worse."

Francis said retired federal employees who have an adjusted gross income of $85,000, not indexed to inflation, can expect to pay a higher Medicare premium.

One alternative retired feds might consider is to enroll in the Medicare Advantage program while suspending their FEHBP enrollment, Francis said.

"If you want to be very frugal, that's a good option to consider," he said.

With the possibility of more buyouts and early retirement offers coming next year, Francis reminded federal employees they must be continually covered in FEHBP for the five years before retirement in order to stay covered after they leave federal service, "or you will lose it the day you retire."

What's more, federal employees who want to have their spouses covered after retirement must be enrolled in the family plan prior to retirement, he said.

The one loophole to the five-year rule is in the event of a reduction in force, a fed can possibly get an appeal from the Office of Personnel Management.

"But I wouldn't count on that," Francis said.

In the first half of Your Turn with Mike Causey, Mike talked to Federal Times' Steve Losey about the impact of the supercommittee failure on federal employees.