Suspension of FEHBP Coverage
Federal retirees (with TRICARE coverage) are also able to suspend their FEHBP coverage for TRICARE. Employees cannot do this, but retirees can. Please be aware there is a difference between suspending and cancelling FEHBP coverage. Earlier in this article, we briefly discussed the effects of cancelling FEHBP coverage.
For example, if a retiree was satisfied with only having their TRICARE coverage for a while, instead of cancelling his/her FEHBP coverage, they could suspend the FEHBP coverage with OPM. If they ever wanted FEHBP coverage back, they could reenroll (or un-suspend) during a retirement open season.
Some federal employees may be very happy with their TRICARE coverage and perhaps they aren’t currently enrolled under the FEHBP. But who knows what health care reform might do to TRICARE in the future?
If TRICARE coverage becomes less attractive to you (or your spouse, if married) for any reason after you retire, you could un-suspend your FEHBP coverage during an open season (if it was suspended after you retired). But if you did not have FEHBP coverage on the date you retired, you would have no FEHBP coverage to suspend in retirement and you would not be eligible to enroll after you retire.
This is why some federal employees, who are happy with TRICARE, will sometimes enroll under an inexpensive FEHBP plan shortly before they retire, pay for the premiums for a few pay periods before they retire, and then suspend the FEHBP coverage when they retire. In this example, they stop paying the FEHBP premiums while the coverage is suspended and rely on their TRICARE coverage. But they know they can reenroll under the FEHBP later if they need or want to.
If you do not have TRICARE coverage, the only health insurance coverage that federal retirees can suspend his/her FEHBP coverage for would be one of the Medicare Advantage Plans (under Medicare Part C). Those suspending FEHBP coverage to use Medicare Advantage must show evidence of enrollment or have applied to enroll and have been accepted in a Medicare-sponsored plan. Of course, this is only IF you decide that Medicare Part C is more attractive than your FEHBP coverage.
Note: Future discussions regarding FEHBP and Medicare coverage should be researched and addressed outside of this article. There are some changes that occur to your FEHBP coverage once you are retired and reach the age of 65 (or retire after the age of 65). Please research this issue further when you are reaching the age of 65.
If a federal retiree (with or without TRICARE) voluntarily cancels their FEHBP coverage, they can never reenroll under their own FEHBP coverage later. The only exception to this cancellation rule is related to the example I gave earlier. If a federal retiree (who previously earned the right to continue his/her own FEHBP coverage into retirement) cancels his/her coverage to be covered under his/her spouse’s FEHBP coverage, then the retiree would be allowed to reinstate his/her own FEHBP coverage later during an open season or within the time period prescribed for a QLE.
FEHBP and Family Coverage
As mentioned previously, the FEHBP is a valuable part of one’s federal retirement package, and can be just as important to the retiree’s family. Eligible family members for retirees include the same eligible family members for employees… spouses and children under the age of 26 (including legally adopted children, stepchildren, and recognized natural children born out of wedlock).
Foster children (including grandchildren, if they qualify as foster children) are included if they live with the employee in a regular parent-child relationship. Also, a child age 26 or over who is incapable of self support because of a mental or physical incapacity which existed before age 26 may qualify for coverage. But you cannot cover other relatives, such as a parent, even if they are otherwise considered your dependents.
Surviving Family Member FEHBP Coverage
While the federal retiree (or federal employee) is still living, eligible family members can be added or removed from the FEHBP plan as appropriate per open seasons and QLEs. But if the retiree/employee predeceases his/her eligible family member(s), the family member(s) would NOT be allowed to continue the FEHBP coverage unless there was a Self and Family plan in effect at the time of death AND there was a survivor benefit potentially payable.
These are the two requirements that must be met in order to allow a surviving family member the right to continue the FEHBP coverage at the same rates afforded to the retiree/employee. If the federal retiree/employee died while in a Self and Family plan, the coverage would automatically continue for the survivor(s) under your enrollment as long as one of them is potentially eligible for a survivor benefit.
For example, let’s look at a situation for a retiree/employee with a spouse and a 23-year old child under his/her Self and Family plan. If the retiree/employee were to die, both the widow/widower and the 23-year old child would be allowed to remain under the Self and Family plan as long as one of the surviving family members was potentially eligible for a survivor benefit.
Note: Eligibility for survivor benefits is an entirely separate topic that should be researched and discussed outside of this article, but depending upon the specific circumstances in this example, there are situations where both these surviving family members may or may not be eligible for a survivor benefit. Since there is a relationship between continuation of FEHBP coverage and survivor benefits, if you have any questions regarding survivor benefits for your family, I would recommend that you obtain such counseling from your agency benefits officer (or OPM if you are already retired).
But in this example, even if the 23-year old child wasn’t eligible for a survivor benefit, the child could remain under the surviving spouse’s Self and Family plan until the age of 26 as long as the widow/widower was potentially eligible for a survivor benefit.
If there is only one surviving family member at the time of the retiree/employee’s death, then the FEHBP enrollment would be changed automatically to the less expensive Self-Only plan for the surviving family member. The surviving family member’s cost for the Self-Only plan would be the same cost that a federal retiree would pay for the Self-Only plan. In other words, the federal government continues to pick up its share of the cost of the premium for your surviving family member(s).
