Federal Health Benefits Program in Retirement: How to Switch FEHB Plans After Leaving Federal Service
The Federal Employees Health Benefits (FEHB) program provides health insurance coverage to federal employees and retirees. One key difference between FEHB in service vs. post-service is that instead your agency being responsible, OPM retirement services assumes responsibility for managing healthcare benefits for retirees.
If you need to manage your FEHB account online, click here for the FEHB online portal for retirees.
If you are a current employee who is planning for retirement, attend an online federal retirement workshop.
Federal Employee Health Benefits in Retirement
The federal retiree's health insurance program offers continuous coverage into retirement. The FEHB plan provides access to a variety of health plans, ensuring both FERS and CSRS retirees can maintain health insurance tailored to their needs. But you might not be eligible to keep FEHB after leaving service. If you aren't covered under FEHB in the last 5 continuous years of service (the last five years immediately preceding retirement), you lose FEHB (unless you have a waiver of the 5 year rule). If you defer your FERS pension, you cannot keep FEHB in retirement. If you postpone your annuity, you can resume coverage when you start collecting your FERS benefit at age 62. If you pass away and elected zero survivor benefits when you submitted your retirement application, your surviving spouse will no longer meet the eligibility requirements.
Overview of Open Season Changes
During Open Season, federal retirees can change plans and make adjustments to their FEHB in retirement. Retirees have the ability to enroll in a new health plan that suits their healthcare needs. The 2026 Open Season (for selecting your 2027 coverage) will be held between mid-November through the first week of December. If no action is made, retiree will keep their FEHB plan as is.
Understanding Changes in FEHB Administration Post-Retirement
As noted above, a huge change that happens pertaining to FEHB after your separate from service, is the shift from agency administration to OPM retirement services administering your insurance plan. OPM now handles all enrollment, premium deductions, and changes for federal retirees, not their former agency. Federal retirees must update their contact information with OPM to ensure seamless communication.
Differences Between Active Employees and Retirees
The administration of the FEHB program differs slightly between active employees and federal retirees. Active employees manage their FEHB benefits through their agency, while retirees interact directly with OPM. The other key difference involves taxes. When actively working, premiums are typically paid with pre-tax dollars, lowering your tax liability. That's not how it works in retirement. FEHB premiums are paid with after-tax dollars for those who continue their FEHB plan's coverage after retiring.
Key Points of Contact for Retirees
The key point of contact for retirees regarding their health benefits is OPM Retirement Services. This is why federal retirees need to keep their contact information updated with OPM to ensure seamless management of their premiums and benefits. OPM needs accurate contact details to send important notifications, plan updates, and handle any issues related to health insurance.
Steps to Change FEHB Plans During Open Season
Outside of the annual FEHB open season events for the group health insurance program, a retiree or active federal employee's only way to add or change is coverage is to do so within 60 days of experiencing a QLE or "Qualifying Life Event" such as a marriage, birth, or death in the family - if such an event affects the employee or those covered as a family member. Whether you are a FERS or CSRS employee, retirement itself is not a QLE.
Here are the steps for changing or adding coverage during Open Season:
Reviewing Your Current FEHB Plan Options
During the Open Season, retirees should begin by carefully reviewing their current FEHB plan options. Utilize the OPM's resources to compare various health plans. Evaluate if your current health plan still meets your health coverage needs, or if another FEHB plan offers better health benefits, lower premiums, or improved health insurance. Studies suggest over 30% of participants who could financially benefit from switching plans just remain on their exiting coverage because they believe changing their lifetime coverage is to much of a hassle.
Using the Services Online Portal for Changes
Federal retirees can use the Services Online portal to make changes to their FEHB plan. Federal employees' health benefits can be altered through this OPM system, allowing you to change plans electronically. Retirees can log in to update their enrollment and select a new health plan that fits their needs during the Open Season. Follow the prompts carefully to ensure accurate changes to your health benefits.
Alternative Methods for Enrollment Changes
If federal retirees cannot use the Services Online portal, there are alternative methods for making FEHB enrollment changes. Federal retirees can submit the RI 76-10 form to OPM by mail. Ensure the form is completed accurately, and keep a copy for your records.
Integrating FEHB Coverage with Medicare in Retirement
Most federal retirees enroll in Medicare Part A at age 65. Medicare Part A works as secondary coverage to your FEHB plan. Understanding how Medicare coordinates with your FEHB health plan ensures comprehensive health coverage into retirement. Note that typically, Medicare B premiums are deducted from social security payments.
The Role of Medicare Part B for Retirees
Unlike with the Postal Service Health Benefits (PSHB) program, where you must be enrolled in Medicare Part B to participate, Medicare enrollment is optional for FEHB retirees, but often recommended. Many FEHB plans reduce copays and deductibles when paired with Medicare Part B. Some plans offer Part B premium reimbursements or other incentives. Retirees should evaluate whether enrolling in Medicare Parts A and B would enhance their overall health coverage and potentially lower out-of-pocket expenses, improving their health benefits.
Budgeting for Health Insurance Costs in Retirement
Budgeting for health insurance costs is a crucial part of retirement planning. Retirees need to account for FEHB premiums, Medicare premiums, and any out-of-pocket healthcare expenses. Evaluating your health coverage needs during Open Season can help you choose a FEHB plan that fits your budget. Federal retirees should regularly review their health plan to ensure it aligns with their financial situation and health requirements.
