While most retirees must take Part B once they or their spouse are no longer actively employed, such is not the case for federal retirees. You basically have three choices, all with pros and cons.
Should USPS retirees have to enroll in Medicare?
- Medicare and FEHB Options - What Will You Do When You Turn 65? (Part 1)
- A Marriage of Convenience – Medicare & FEHB
- What to Consider Before Enrolling in Medicare B (Part 2)
- Should You Change to a Lower Cost FEHB Plan When You Sign Up For Medicare (Part 3) Caution - Don't Lose Your FEHB Coverage
Should federal employees enroll in Medicare?
There is a monthly premium for Part D coverage. Most Federal employees do not need to enroll in the Medicare drug program, since all Federal Employees Health Benefits Program plans will have prescription drug benefits that are at least equal to the standard Medicare prescription drug coverage.
Should veterans enroll in Medicare's Part B?
The VA usually encourages veterans to enroll in both Medicare Part A (hospital insurance) and Medicare Part B (medical insurance). You typically don't have to pay a premium for Part A, while the standard Part B premium for 2019 is $135.50 or higher, depending on your income.
Do you really need Medicare Part B?
Medicare Part B isn’t a legal requirement, and you don’t need it in some situations. In general, if you’re eligible for Medicare and have creditable coverage, you can postpone Part B penalty-free. Creditable coverage includes the insurance provided to you or your spouse through work.
Do federal employee retirees need Medicare Part B?
Most people who have retiree coverage must enroll in Medicare Part A and Part B when first eligible. If they don't enroll, their retiree plan may pay only a small amount – or nothing at all – for their care.
Do federal employees pay for Medicare Part B?
Your FEHB Plan must pay benefits first when you are an active Federal employee or reemployed annuitant and either you or your covered spouse has Medicare. (There is an exception if your reemployment position is excluded from FEHB coverage or you are enrolled in Medicare Part B only.)
Do retired federal employees pay for Medicare?
Most Federal employees and annuitants are entitled to Medicare Part A at age 65 without cost. When you don't have to pay premiums for Medicare Part A, it makes good sense to obtain coverage. It can reduce your out-of-pocket expenses as well as costs to FEHB, which can help keep FEHB premiums down.
Do you really need Medicare and FEHB as a federal employee?
Answer #1 —You don't need both. However, to quote OPM “generally, plans under the FEHB program help pay for the same kinds of expenses as Medicare.” In many cases FEHB proves to be more comprehensive, often including emergency care outside the U.S., as well as dental and vision, which Medicare does not cover.
What happens to my FEHB when I turn 65?
Your FEHB coverage will continue whether or not you enroll in Medicare. If you can get premium-free Part A coverage, we advise you to enroll in it. Most Federal employees and annuitants are entitled to Medicare Part A at age 65 without cost.
Can federal employees have both FEHB and Medicare?
The answer: yes! FEHB coverage is comparable to Medicare coverage. Therefore, beneficiaries in the federal program may delay joining a Part D plan; likewise, they're exempt from any Part D late enrollment penalties.
Do federal employees keep their health insurance after retirement?
Yes, you can keep your existing health benefits coverage if you meet all of the following conditions: You're enrolled in health care insurance under a federal plan when you retire.
Which is better FEHB or Medigap?
And the National Active and Retired Federal Employees Association has said that because FEHB plans “are far superior to most Medigap policies, annuitants who have Medicare and FEHB coverage have little need for any type of extra health plan.
What is the cost of FEHB for retirees?
For retirees and non-postal employees in the largest FEHB plan, Blue Cross/Blue Shield standard, biweekly enrollee rates for self-only are increasing by $6.54 to $123.45, for self plus one by $13.66 to $280.81 and for family coverage by $13.38 to $300.12.
Are federal retirees automatically enrolled in Medicare?
Unlike most people with retiree coverage, who must enroll in Medicare Part A and Part B when they're first eligible, enrollment in Medicare is not mandatory if you have federal retiree coverage through the Federal Employee Health Benefits Program (FEHB).
Who pays first FEHB or Medicare?
When FEHB and Medicare Coordinate Benefits, Which One Pays Benefits First? Medicare law and regulations determine whether Medicare or FEHB is primary (that is, pays benefits first).
Medicare has different enrollment rules if you're a federal retiree
Unlike most people with retiree coverage, who must enroll in Medicare Part A and Part B when they're first eligible, enrollment in Medicare is not mandatory if you have federal retiree coverage through the Federal Employee Health Benefits Program (FEHB).
Medicare Part B if you have FEHB coverage
You do not have to enroll in Part B if you don't want to, and you're not required by your FEHB plan to take it. However, some people choose to have both Part B and FEHB coverage.
Medicare Part A if you have FEHB coverage
The Office of Personnel Management (OPM), which administers the FEHB plans, recommends you take Part A if you don't have to pay a premium. This helps cover some of the costs the FEHB plans may not cover and limit your out-of-pocket expenses for services you receive.
Medicare Part D if you have FEHB coverage
If you have FEHB coverage, you typically don't have to enroll in a Part D plan. FEHB plans include prescription drug coverage, often with fewer restrictions than Medicare Part D plans. They also limit what you'll pay each year in covered prescription costs, so you may pay less than with a Part D plan.
Changing your FEHB coverage
You can make changes to your FEHB coverage beginning 30 days before qualifying for Medicare. Or, changes can be made during FEHB Open Season, which runs from the Monday of the second full workweek in November through the Monday of the second full workweek in December each year.
Is Medicare or FEHB the primary payer?
The FEHB provides health insurance to federal retirees and their spouses. You have the option to choose from a few different types of plans, each covering medical services and supplies you may need.
When is Medicare the primary payer?
If you or your covered spouse are age 65 and have Medicare, it is the primary payer when you:
Whether you should enroll in Medicare is based on federal law, not personal preference
If you already have health insurance when you turn 65, signing up for Medicare may seem redundant. Unfortunately, failing to enroll in Medicare Part B when you retire could leave you owing significant late penalties.
What Are the "Parts" of Medicare?
There are four "parts" to Medicare. Original Medicare includes Part A, hospital insurance, and Part B, medical insurance. Medicare Part A covers inpatient services received in a hospital or skilled nursing facility (SNF).
How Much Does Original Medicare Cost?
Like other types of health insurance, out-of-pocket Medicare costs include deductibles, premiums, and coinsurance or copayments. Costs for Parts C and D vary, because these are private insurance plans, meaning the insurer sets the rates.
Medicare Part B Costs
The standard Medicare Part B premium is $170.10 per month. You pay this amount even if you have a Medicare Advantage plan.
Should Federal Retirees Enroll in Medicare?
All federal employees have paid the Medicare tax since 1983, which means you qualify for premium-free Part A if you are a federal annuitant age 65 or older. We strongly encourage any federal employee age 65 or older to sign up for Medicare Part A as soon as they become eligible.
Who Pays First?
Medicare pays first once you retire. However, if you are a rehired annuitant or active federal employee, then your FEHB health plan pays first.
When Should You Enroll in Medicare?
If you're retired, you should sign up for Medicare as soon as you're eligible at age 65. This is known as your Initial Enrollment Period (IEP). It lasts for 7 months, beginning 3 months before your 65th birthday and ending 3 months after your birth month.
Can Federal Employees Keep Their Health Insurance After Retirement
Although unnecessary, retirees may choose to have benefits from both programs. Retiring and Medicare eligibility begin at age 65.
When Is My Fehb Plan The Primary Payer
There are some cases when your FEHB plan would be the primary payer, meaning it pays for the cost of services first and Medicare covers the rest. If you or your covered spouse are age 65 and have Medicare, your FEHB plan is the primary payer when you:
Suspending Fehb For Medicare Plus Supplemental Coverage
If you have Original Medicare and FEHB but want coverage through an Advantage or Medigap plan, youll need to suspend your FEHB coverage. Suspending FEHB is not the same as canceling.
Is Medicare Or Fehb The Primary Payer
The FEHB provides health insurance to federal retirees and their spouses. You have the option to choose from a few different types of plans, each covering medical services and supplies you may need.
What Happens If I Decline Fehb Coverage
If you decline FEHB coverage, you would give up the subsidy the government pays toward it, which ranges from a low of about $350 for self-only coverage to $1,000 or more if youre also covering family members. If your family members are covered under FEHB, their coverage would end if you terminate yours.
Should Federal Annuitants Enroll In Medicare Part B After Age 65
There are advantages to enrolling in Part B as a complement to FEHBcoverage . Almost all ofthe national plans waive their hospital and medical deductibles, copays,and coinsurance for members enrolled in both Medicare Part A andPart B . In effect, they “wrap around” Medicare.
What About A Roth Conversion
If you are over age 65 and paying for Part B, you could increase your IRMAA by performing Roth conversions. A Roth conversion may still be beneficial but be careful. It may end up costing you more than just income taxes to perform the conversion.
Guide for Federal Retirees and Medicare Part B
Medicare Part B covers physician and outpatient services. Part B can include ambulance services and durable medical equipment as well as laboratory tests and x-rays.
To Take Part B or Not to Take Part B, that is the Question
If you don’t take Part B when you are first eligible there is a 10% penalty on the current year premium added for each year you delay enrollment. You will need to pay this penalty for as long as you have Medicare.
Part B Premium Determination
Medicare Part B premiums are determined by your Modified Adjusted Gross Income (MAGI). The higher your income, the higher your Part B premium. For many beneficiaries, the government pays a large portion of the Part B premium, about 75 percent, and the beneficiary pays the remaining 25 percent.
Understanding the Eligibility Rules for the Basic Medicare Options
While in federal service, every federal employee pays the Medicare Hospital Insurance Tax (HIT) payroll tax, equal to 1.45 percent of an employee’s salary (and matched by the employee’s agency).
Compare Investment Options for 2021
3 – Medicare Part C (Medicare Advantage, previously called Medicare Choice) are expanded health plan options (such as an HMO or PPO) approved by Medicare and offered by private companies that combine Part A and Part B in one network of health care providers. Medicare Advantage Plans are approved each year by Medicare.
Does Medicare pay for FEHB?
Medicare may pay for some services that your FEHB plan doesn’t cover, such as home health care, some medical equipment and supplies, and orthopedic or prosthetic devices. Your FEHB plan may pay for some services that Medicare doesn’t cover, such as annual physicals, routine dental and vision care, and emergency coverage outside of the United States.
Can you waive FEHB copays?
Some FEHB plans waive their own deductibles and copays for services that are also covered by Part B. If you don’t sign up for Part B when you retire, but need to do so at some future date — for example, if you lose FEHBP coverage or it becomes too expensive to maintain — you would be liable for Part B late penalties.
What happens if you don't enroll in Medicare?
As a federal retiree, if you don’t enroll in Medicare, your FEHB plan will act as your primary insurer and won’t pay less because you qualify for Medicare.
How long before you can change your FEHB coverage?
You may want to make changes to your FEHB coverage when you are nearing Medicare eligibility, and will have the option to do this starting 30 days before you qualify for Medicare. Changes can only be made once during this window. You can also wait until FEHB Open Season to change your coverage. Back to top.
Is FEHB more generous than Medicare?
Although FEHB coverage can be more generous overall than Medicare Advantage or Original Medicare, having additional coverage may not be helpful if you can’t afford its premiums. If you qualify for the Medicare Savings Program (MSP) or Medicaid, you may find your healthcare costs are lower overall if you don’t use FEHB.
Can you suspend your Medicare Advantage plan?
You can suspend your enrollment in FEHB to enroll in Medicare Advantage or other eligible coverage by contacting your agency’s retirement system, and providing them documentation that you enrolled . If you do this , you’ll be allowed to leave your Medicare Advantage plan and return to FEHB.
Does FEHB cover dental?
Conversely, FEHB plans cover emergency care received outside the United States, and this isn’t covered by Original Medicare at all – and is rarely covered by Medicare Advantage. FEHB plans may also pay for vision and dental care that’s not covered by Original Medicare and is limited in Medicare Advantage.
Is FEHB covered by Medicare?
While FEHB plans cover most of the same types of expenses that Medicare covers, FEHB plans’ coverage may be more limited than Medicare Part B when it comes to orthopedic and prosthetic devices , durable medical equipment, home healthcare, medical supplies, and chiropractic care.
Can you pay Medicare excess?
Some states don’t allow excess Medicare charges. If you live in one of these states – or you see a doctor in any state that accepts Medicare’s rate as full payment – you’d only have to pay the difference between what Medicare and your FEHB plan pay and Medicare’s rate.
How much is Part B insurance?
That depends. The normal premium for Part B is $148.50, but that is for the “normal” premium. For high-income retirees (and I use the term “high-income” very loosely), that number escalates. It is remarkably easy for federal retirees, especially single retirees, to find themselves in this “high-income” category.
Who is Brad Bobb?
Brad Bobb is a financial planner with over a decade of experience working with federal employees. He is acutely focused on the financial livelihood of employees who are part of the CSRS or FERS systems. Any federal employee with a question can email him or visit bobbfinancial.com.
Does Part B replace FEHB?
Part B doesn’t replace the Federal Employees Health Benefits (FEHB), but rather supplements it.
Is Medicare Part B important?
The decision on whether or not to take Medicare Part B is an important one, and your income range should play a role in that decision. IRMAA is just one way that retirees can incur extra, unnecessary costs in retirement. Addressing seemingly little things like IRMAA can help you enjoy a fruitful retirement.
