Before you retire, it's important to explore all your options when you become eligible for Medicare. For federal retirees, this can be a bit tricky. In this video, we go over your options if you're eligible for both Medicare and Federal Employee Health Benefits.
Active government workers and retirees are enrolled in the Federal Employee Retirement Health Benefits (FEHB) program. This program covers both inpatient and outpatient services, just like Medicare. This is why some beneficiaries who are eligible for both are confused about whether they need to enroll in each program.
For the most part, those enrolled in FEHB don't need to enroll in a Medigap, Medicare Part D, or Medicare Advantage plan because their benefits already include this coverage. However, because FEHB benefits are expensive, those who are newly eligible for Medicare wonder how they can coordinate their coverage to reduce their out-of-pocket costs.
There are a few ways to do this. The first way is to enroll in Part A to supplement your FEHB benefits. More than likely, you worked 40 quarters or 10 years and paid into Medicare throughout those years, making you eligible for premium-free Part A. You can also become eligible in Medicare Part A through your spouse if they've worked for 10 years.
Enrolling in Part A will give you extra coverage for any inpatient medical expenses you incur. Your FEHB will be primary and Medicare Part A will be secondary. You'll save money by not paying the monthly Part B premium. The downside is you'll pay copays for your out-of-pocket services.
Compare the cost of the Part B premium to what you could be spending in copays to determine which option will save you the most money.
The other downside is if you delay enrolling in Part B, you'll incur late enrollment penalties since FEHB is not considered creditable coverage through Medicare. So, an additional 10% will be added to your premium for every 12 months you went without coverage.
Your other option is to enroll in Part A and Part B to supplement your FEHB benefits. With this combination, you're paying for both FEHB and Medicare. Medicare is your primary coverage, and FEHB is secondary coverage. Your FEHB acts as a supplement plan and covers deductibles, copays, and coinsurance. With this combination, you can see any doctor that accepts Medicare and you'll even have some additional benefits under Part B that FEHB does not cover. Also, since FEBH includes prescription drug coverage, you wouldn't need to enroll in Part D.
The third way to do this is to enroll in Part A and Part B with Medicare Advantage or a Medigap plan, suspending your FEHB coverage. The reason Medicare beneficiaries go with this coverage is that they determine this combination would cost less than keeping FEHB.
We go into some frequently asked questions in this video as well! Please go to 3:07 for the answers.
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Before you retire, it's important to explore all your options when you become eligible for Medicare. For federal retirees, this can be a little bit tricky. In this video, we're going to go over all your options if you're eligible for both Medicare and federal employee health benefits. Hi Medicare Community. My name is Lindsay Malzone, and I'm the Medicare expert for Elite Insurance Partners and MedicareFAQ.com. Active government workers and retirees are enrolled in the Federal Employee Health Benefits Program or F.E.H.B. F.E.H.B. covers both inpatient and outpatient services just like Medicare. This is why beneficiaries who are eligible for both Medicare and F.E.H.B. are confused on if they need to enroll in each program. For the most part, those enrolled in F.E.H.B. don't need to enroll in a Medigap Part D or Medicare Advantage plan because their benefits already include this coverage. However, because F.E.H.B. benefits are expensive, those who are newly eligible for Medicare wonder how they can coordinate their coverage to reduce their out-of-pocket cost. There are a few ways to do this. The first way is to enroll in Part A to supplement your F.E.H.B. benefits. More than likely, you worked 40 quarters or 10 years and paid into Medicare throughout those years making you eligible for premium-free Part A. You can also be eligible for premium-free Part A, through your spouse if they work 10 years. You can enroll in Part A since it won't cost you anything. This will give you extra coverage for any inpatient medical expenses you incur. Your F.E.H.B. will be primary and Medicare Part A will be secondary. You'll save money by not paying the monthly Part B premium. The downside is you'll pay co-pays for your outpatient services. Youll want to compare the cost of the Part B premium to what you could be spending in co-pays for outpatient services to determine which option will save you the most money. The other downside is if you delay enrolling in Part B, you'll incur a late enrollment penalty since F.E.H.B. is not considered creditable coverage under Medicare. This will be an additional 10% added to your monthly premium for every 12 months you went without coverage. The second way is to enroll in both Medicare Part A and Part B to supplement your F.E.H.B. benefits. With this combination, you're paying for both F.E.H.B. and Medicare. Medicare is your primary coverage and F.E.H.B. is secondary coverage Your Federal Employee Health Benefits acts as a Supplement Plan and covers deductibles, co-pays, and coinsurance that Original Medicare leaves up to the beneficiary to pay. This combination gives you great coverage. You can see any doctor that accepts Medicare and you'll even have some additional benefits under Part B that F.E.H.B. benefits do not include. You would not need to enroll in Part D since F.E.H.B. includes prescription drug coverage. The third way to do this is to enroll in Part A and Part B and then decide between a Medicare Advantage or Medigap plan and suspend your F.E.H.B. coverage. With this combination, youll enroll in Original Medicare and either a Medigap plan or Medicare Advantage plan, and then suspend your F.E.H.B. coverage. The reasons beneficiaries may go with this option is because they determine this combination would cost them less when compared to keeping their F.E.H.B. benefits active. Now that we've gone over three different ways you can combine your Medicare coverage and F.E.H.B. benefits, let's go over some frequently asked questions. As a federal employee. Am I required to enroll in Medicare? The answer is no, Medicare is not mandatory. You can choose to not enroll in Medicare and just have F.E.H.B. If I decide to not sign up for Part B. What are the consequences? The answer is, if you delay enrolling in Part B, you'll incur a late enrollment penalties. Federal Employee Health Benefits is not considered creditable coverage under Medicare. You'll incur a 10% penalty added onto your Part B premium for every 12 months you go without coverage. If they cover both inpatient and outpatient services, what's the point of purchasing both programs? The answer is, the combination of Medicare and F.E.H.B. leaves you with very little out-of-pocket cost since they each fill in the gaps in coverage. F.E.H.B. will cover deductibles, coinsurance, and co-pays under Medicare, while Medicare gives you additional benefits and an unlimited network of doctors. When Medicare becomes primary, do my F.E.H.B. premiums change? The answer is no, you'll pay the same premium for F.E.H.B. with or without Medicare. Do I need F.E.H.B. if I enroll in a Medigap plan or Medicare Advantage plan? The answer is no. If you prefer to enroll in a Medigap or Medicare Advantage plan to supplement your original Medicare coverage, you can suspend your F.E.H.B. coverage. Do I need Part D if I have F.E.H.B.. The answer is no, you do not need Part D. That's because your F.E.H.B. includes prescription drug coverage. Thank you for watching our video. We hope you found it helpful. If you did, don't forget to subscribe to our YouTube channel, make sure notification turned on so you're notified each time we upload a new video. We also have a fantastic Medicare community on Facebook. Well include a link in the description below so you can join. Until next time. Bye.