Requirements For Surviving Family Members
For your surviving family members to continue your health benefits enrollment after your death, all of the following requirements must be met:
- You must have been enrolled for Self and Family or Self + 1 at the time of your death and
- At least one family member must be entitled to an annuity as your survivor.
All of your survivors who meet the definition of “family member” can continue their health benefits coverage under your enrollment as long as any one of them is entitled to a survivor annuity. If the survivor annuitant is the only eligible family member, the retirement system will automatically change the enrollment to Self Only. Your surviving spouse should follow up with OPM to insure this action was taken. If it wasn’t, your spouse will be paying considerably higher Family Option premiums.
Under FERS, your surviving spouse who is entitled to a basic employee death benefit, or your surviving children whose benefits are offset by Social Security, may continue your health benefits enrollment by paying premiums directly to OPM.
When your surviving spouse will not receive any survivor benefits because your former spouse has a court-ordered entitlement to a survivor annuity, your surviving spouse can continue FEHB coverage if you had a Self and Family enrollment. The retirement system will notify your surviving spouse of his/her options and take whatever actions are requested.
What Insurance Do Postal Employees Get
Newly hired postal employees are covered under Social Security and Medicare. The Postal Service offers coverage through the Federal Employees Group Life Insurance Program. The cost of Basic coverage is fully paid by the Postal Service, with the option to purchase additional coverage through payroll deductions.
Would The Medicare Proposal Impose Any Costs On Postal Stakeholders
For the most part it would not. Postal retirees would remain in the FEHB Program and would largely retain the overall health coverage they have now, although more of it would come through Medicare. One group that would see higher costs is the minority of postal retirees not currently enrolled in Medicare Part B because they would have to start paying Part Bs premiums. Meanwhile, with less financial pressure on the Postal Service, it would be less likely that changes burdening stakeholders, such as higher postal rates, further reductions in the postal workforce, the closing of more postal facilities, or a rethinking of postal employees fringe benefits, would be undertaken.
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Civil Service Retirement System
If you started working for the Post Office before 1984, you probably fall under the Civil Service Retirement System, unless you voluntarily switched to the newer Federal Employees Retirement System. Your pension, which can begin as early as age 55, is based earnings, length of service and whether you provide a survivor benefit to your spouse. Because you have not paid Social Security or survivor and disability tax, also called OASDI, you are not eligible to receive either. You can contribute tax-deferred earnings to the Thrift program — the federal governments version of a 401 plan — but you will not receive matching funds.
When The Service Defaults On Statutory Funding Contributions How Is That Recorded
The required contribution amount is reported as a cost, and it reduces profits or widens losses. Because no contribution is actually made, there is no addition to fund assets. For instance, the Postal Services statutory RHBF contribution in 2015 was $5.7 billion. Together with other costs, that obligation contributed to the Services $5.1 billion net loss in 2015. However, because the Service defaulted on the payment, it obviously did not reduce cash on hand, did not add to RHBF assets, and did not reduce the unfunded retiree health benefits liability.
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How Much Is The Postal Service Supposed To Contribute To The Retiree Health Fund And Over What Time Frame
PAEA divided the catch-up funding of the RHBF into three phases.
- First, to give the RHBF a head start, PAEA transferred into the new fund the Postal Services overfunding of Civil Service Retirement System pensions and the money in the temporary escrow account .
- Second, PAEA directed the Postal Service to make payments into the RHBF averaging about $5.6 billion annually over the 10 years, 2007-2016. These payments closely matched what the Postal Service saved due to its reduced pension contributions. Although Congress was aware that retirement pensions and retiree health care are separate fringe benefits, it decided that reduced pension costs increased the Services ability to fund its retiree health care commitments. An additional consideration was the favorable effect the contribution schedule had on PAEAs 10-year budget score.
- Third, in 2017, OPM is to compute the Services remaining unfunded liability for the retiree health benefits promised to current and former postal workers, and the Service is to amortize the liability over the 40-year period 2017-2056. Also, starting in 2017, the Service is to make a payment each year equal to the value of the additional retiree health benefits earned by employees that year.
How Can You Get A Waiver To The Five
If you were declared ineligible for FEHB because of the five-year rule, you may be able to obtain an exception. But you should know that such a waiver is not common and you will have to meet certain conditions.
The first condition is that you have to show that you intended to maintain FEHB when you retired. The second condition is that you can show circumstances beyond your control prevented you from adhering to the five-year rule. The final condition is that you have to have done everything within your controlincluding reading all information provided, asking questions, and asking for related informationto ensure you could maintain your health benefits in your situation.
In short, you have to have reasonably acted to protect your rights to your FEHB coverage. If you have, you may be able to obtain a waiver.
Be proactive throughout your time as a federal employee so you don’t lose your FEHB when you retire.
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Prior To Paea The Postal Service Had Paid The Employer Portion Of Retirees Fehb Premiums As The Premiums Came Due How Are The Premiums Due Each Year Being Paid For Under Paea
Congress decided to have a transition period between the new and old financing systems. During the 10 years 2007-2016, while the assets in the RHBF are building up, the Service has continued paying the employer portion of the FEHB premiums that come due each year. Starting in 2017, the retiree health care premiums that arrive each year are to be paid using the assets in the RHBF.
Dental And Vision Premium Increases Remain Minimal
Average premium rate increases under the Federal Employees Dental and Vision Plan are relatively minimal for 2022.
Premiums will rise for FEDVIP dental plans by 0.81% on average, while vision plans will go up by 0.95%, according to OPM.
Participants will have access to 23 dental plans, including 14 nationwide options, from a total of 12 carriers.
They can choose from 10 nationwide vision plans from five carriers in 2022, OPM said.
Participants can find more information about these FEDVIP plans in October or November ahead of open season on Benefeds.com.
In addition, federal employees must reenroll each year in the Federal Flexible Spending Account Program if they want to set aside pre-tax dollars for their health or dependent care costs.
Special COVID-19 flexibilities allow employees who had a health or dependent care FSA this year can carry over all unused funds at the end of 2021 to use for the following year if the participant reenrolls.
Carryover flexibilities will be more limited for 2023, which federal employees should consider when deciding how much to contribute in 2022, OPM warned.
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Did The Postal Service Initially Support Or Oppose The Prefunding Provision
Although the Service is now sharply critical of the fund, the opposite was once the case. In fact, the creation of a Postal Service Retiree Health Benefit Fund was originally the Services idea, contained in a proposal it submitted to Congress in 2003. The Service claimed its proposed fund, which would have been a much more limited fund than the one Congress established three years later, addressed the concerns of Congress, the GAO, and the widely respected bipartisan Presidents Commission on the United States Postal Service about its large and growing retiree health care liability. The Service observed that its proposal, as a sweetener for Congress, was structured to avoid increasing the federal deficit.
The Presidential Commission had previously recommended funding a reserve account to address these obligations to the extent that Postal Service finances permit in order to improve transparency and so future ratepayers are not forced to pay for postal services delivered to the nation today.
The Postal Service Also Offers Most Of Its Workers Pension Benefits Are The Two Programs Related
No, they are separate fringe benefits. Three similarities, though, are that both are forms of deferred compensation they are expensive and they are increasingly uncommon outside the government sector. s, are rapidly replacing defined benefit pensions in the business and nonprofit sectors. And, as mentioned above, fewer and fewer employers outside the government sector offer retiree health benefits.)
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How Can You Add Family Members
As long as you are eligible and have met your requirements, you can add a new spouse or a child after you have retired at any time because of a life change event. You may also switch your type of plan from a Self Only to a Self and Family plan during a Federal Benefits Open Season. An FBOS typically runs from early November to mid-December of a given year.
Fehb Premium Rate Charts Now Available
September 29, 2021My Federal Retirement
Federal employees and retirees share of 2022 Federal Employees Health Benefits premiums will increase on average by 3.8% according to the Office of Personnel Management.
This is a lower increase than in previous years when the FEHB health care plan premiums went up by 4.9% in 2021 and 5.6% in 2020.
Quality health insurance has never been more important, and OPM is ensuring all eligible enrollees have the information they need to make informed decisions about their coverage, OPM Director Kiran Ahuja said. The global pandemic underscores the responsibility an employer has to provide their workforce with quality, affordable, and dependable health care options. As the largest employer in the United States, the federal government is proud to lead by example with a wide choice of health insurance plans from the FEHB and FEDVIP that deliver the quality coverage every employee deserves.
The governments share of 2022 FEHB premiums will go up by an average of 1.9%. On average, the governments share of the of the total cost of an employees health insurance premiums is 70%. FEHB premiums will go up an average of 2.4% overall next year when combining both the employees and governments shares.
It is important to note that the specific amount of the 2022 FEHB premium rate change will vary based on the plan an enrollee chooses.
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The Apwu Publication Cited Immediately Above Also Claimed The Usps Financial Crisis Is A Hoax A Pretext For Cutting Service And Paving The Path To Privatization Was The Rhbf Created To Crush The Postal Service Financially And Push It Toward Privatization
No. As discussed earlier, Congress, the Administration, GAO, and the bipartisan Presidents Commission on the United States Postal Service were all worried by a postal retiree health care liability that was extremely large, entirely unfunded, and rapidly growing, reaching $74.8 billion by the end of 2006. None of these parties advocated privatization, and the presidential commission explicitly rejected that path. When Congress enacted PAEA, the RHBF and the acts other components were expected to protect the long-term financial viability of a Postal Service that remained part of the federal government. In hindsight, the RHBFs funding schedule should have been more gradual, but the main weakness of PAEA was that it did not give the Service better tools to manage costs and keep them in line with revenues.
When this paper cites numbers from the Postal Services financial statements, the years are Postal Service fiscal years, which begin on October 1 of the prior calendar year and end on September 30 of the current calendar year. Also, when this paper mentions the health benefits of postal retirees, it should be understood that dependents qualify for benefits in many cases.
U.S. Postal Service, Form 10-K, 2015, pp. 10 and 25, November 13, 2015, .
Ibid., pp. 10 and 55.
The name of this government watchdog agency was later changed to Government Accountability Office, but it kept the same acronym.
Does Moving From The Pay
This does occur during the transition. As a result of prior pay-as-you-go financing, there are legacy costs from past production that must be paid. In the case of the Postal Services retiree health benefit obligations, these unfunded liabilities had built to $74.8 billion by the time PAEA was enacted. With the switch to the funded approach, those obligations from the past must be paid and, in addition, the full costs of the future retiree health benefits pledged each year in return for current labor services must be reported and paid.
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Should I Enroll In Part B If I Have Fehb Coverage
Deciding whether to enroll in Part B is complicated. And unlike Medicare Part A, all enrollees pay a premium for Medicare Part B . 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. Conversely, FEHB plans cover emergency care received outside the United States, and this isnt covered by Original Medicare at all and is rarely covered by Medicare Advantage. FEHB plans may also pay for vision and dental care thats not covered by Original Medicare and is limited in Medicare Advantage.
If you are covered by an FEHB HMO plan, youre normally limited to seeing providers who are part of your plan. Having Part B means you can go outside the HMOs network and see other providers, as long as theyre part of Medicare.
Is The Postal Service Which Officially Lost $568 Billion During The Years 2007
As an example of this position, Ralph Nader said in 2011, The deep hole of debt that is currently facing the U.S. Postal Service is entirely due to the burdensome prepayments for future retiree health care benefits imposed by Congress in the PAEA. If the prepayments required under PAEA were never enacted into law, the USPS would not have a net deficiency but instead be in the black. More recently, the American Postal Workers Union asserted, The USPS financial crisis is a manufactured one. If not for that requirement, the Postal Service would have done quite well financially over the last few years. The basic flaw in these arguments is that they try to wish away the Services retiree health care obligations. If those obligations did not exist, the Postal Service would indeed be close to profitable and the RHBF would be unjustified. As explained earlier, however, the Services retiree health care promises, and the costs associated with them, are very real and very large.
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The Postal Service Later Modified Its Proposal What Was The Major Change
Following consultations with postal unions and other major stakeholders, the Service dropped its demand that postal workers leave the FEHB Program. This change eliminated the component of the proposal that had the most potential to lower total federal health benefit spending. However, the revised proposal would still require postal retirees receiving retirement health benefits to enroll in Medicare if they are Medicare-eligible. That preserved the element of the plan letting the Postal Service lower its health benefit costs by shifting more of them to Medicare.
What Are The Us Federal Governments Retirement Benefits
Federal employees receive generous retirement benefits. Many people know that federal employees receive a pension. However, few people understand the full complement of federal retirement benefits. Employees in the federal employee retirement system, also called FERS, receive three benefits. A retirement annuity . A supplemental pension from ages 57-62. A continuation of their FEHB plan into retirement. Previously, I have written extensively about all of the benefits of federal employment. Today Ill try to explain federal employee health insurance benefits after retirement.
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What Are The Strengths Of Paying For Commitments When They Are Made
The funded approach more accurately shows the costs of current operations on financial statements, which motivates employers to better manage costs and be more careful about what they promise. The most basic advantage, though, is that if employers put aside money as they promise benefits, the odds increase that they can make good on their promises. Additionally, for employers in the business and nonprofit sectors, the funded approach lessens the danger that the deferred costs of todays commitments will lead to bankruptcy tomorrow. For government employers, the funded approach reduces the hazards that unfunded obligations will eventually require large tax increases, such as those being felt now by Chicago property owners as the city tries to shore up dangerously underfunded pensions, drastic cuts in government services, and, in extreme cases like Detroit and Puerto Rico, contribute to bankruptcy or its equivalent. For a government-owned enterprise with a large monopoly market, such as the Postal Service, the risks due to not funding deferred compensation are cutbacks in service quality for monopoly-market customers, higher postal rates within the monopoly, shifting costs to other government programs, and perhaps a taxpayer bailout.