How to carry your health insurance into retirement


One of the most valuable benefits offered to federal employees is the opportunity to enroll in the Federal Employees Health Benefits Program. I thought it would be a good idea to spell out the conditions that need to be met to carry FEHBP coverage into retirement.

If you are eligible to retire on an immediate annuity, you can keep your health benefits coverage if you are currently enrolled in FEHBP and have been continuously covered for at least five years. Note: You are considered continuously covered even if you were enrolled in the program when you left government and re-enrolled immediately on your return.

For most employees, that five-year criterion is easily met. It can be a real problem for those who don’t meet it. Fortunately, there are some exceptions to the five-year rule:

If you enrolled in FEHBP when you were first offered that opportunity but don’t have five years of coverage when you retire, you could still carry that coverage into retirement. Although this situation is rare, it occurs when an employee moves from a retirement system that doesn’t provide FEHBP coverage, and the time spent in the other retirement system is creditable to the Civil Service Retirement System or Federal Employees Retirement System, by the payment of a deposit or the transfer of retirement contributions from the old system to the new one.

The Office of Personnel Management can pre-approve waivers of the five-year requirement, if your agency is authorized to offer early retirement under the Voluntary Early Retirement Authority or buyouts through Voluntary Separation Incentive Payments. The Defense Department has similar authority for its employees.

If you retire under a VERA or with a VSIP, your agency will attach a memo to your retirement application stating that you meet the criteria to carry your FEHBP coverage into retirement.

If you aren’t pre-approved for a waiver, you may still request one from OPM. Requests will be judged case by case and decided on their merits. However, since OPM may only grant such waivers when it would be against equity and good conscience not to, it doesn’t have much leeway.

As a retiree, you’ll have the same opportunity to change plans or options during the annual FEHBP open season as you did as an employee. However, under certain conditions, you’ll be able to make changes at other times — for example, if there is a change in your family status, such as marriage, birth or death of a family member, adoption, legal separation or divorce.

If you are a FERS employee who retires at your minimum retirement age with at least 10 years of service, you have the option of postponing the receipt of your annuity to reduce or eliminate the age penalty. If you take that option, your FEHBP coverage is also postponed, but you can re-enroll in FEHBP when you begin receiving your annuity. The key word here is “postpone.” If you leave service without being eligible to retire and later apply for a deferred annuity, you can’t re-enroll in FEHBP.

With the exception of Postal Service retirees, you’ll pay the same premiums in retirement that you did as an employee. Under labor-management agreements, the Postal Service pays a higher percentage of its employees’ premiums. When Postal Service employees retire, they begin paying the same premiums as all other federal employees and retirees. Note: Retiree premiums are deducted on a monthly basis, rather than biweekly.

If you aren’t eligible to keep your FEHBP coverage when you leave or retire, you’ll be given a 31-day extension of coverage at no cost to you. After that, you have a choice: You can drop your coverage, convert to an individual contract with your current plan, or elect to be covered under the temporary continuation of coverage provision. The TCC provision allows you to keep your FEHBP coverage for up to 18 months by paying the full premium plus 2 percent to cover administrative costs.


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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to

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