If you’re a federal employee approaching retirement, Medicare can be one of the most confusing pieces of your benefits picture. Between your existing FEHB coverage and new eligibility for Medicare at age 65, knowing what to enroll in — and when — can feel overwhelming.
The good news? You have options. And with the right guidance, you can make the decision that best fits your health and financial goals.
At Independence Benefits, we help federal employees understand how Medicare works with FEHB and what choices are available at retirement. Here’s a breakdown of what you need to know.
Medicare Basics for Federal Retirees
Medicare is the federal health insurance program for individuals aged 65 and older (and some younger individuals with certain disabilities). It’s divided into several parts:
- Part A – Hospital Insurance
- Part B – Medical Insurance (doctor visits, outpatient care, preventive services)
- Part C – Medicare Advantage (optional private plan alternative)
- Part D – Prescription Drug Coverage
As a federal retiree, you typically maintain access to FEHB (Federal Employees Health Benefits) in retirement — which puts you in a unique position. Unlike many private sector workers, you’re not forced to drop your existing coverage.
Should You Enroll in Medicare Part A?
Yes, in most cases.
Part A is premium-free if you or your spouse paid Medicare taxes while working. It provides hospital coverage and typically doesn’t conflict with your FEHB plan.
We generally recommend enrolling in Part A when you become eligible at 65, even if you’re still covered under FEHB.
What About Medicare Part B?
This is the big decision.
Part B has a monthly premium (based on your income), which leads many retirees to ask: Do I really need both FEHB and Part B?
Here’s how to think about it:
If you enroll in both:
- FEHB becomes your secondary payer (after Medicare)
- You may pay less out-of-pocket for services Medicare covers
- Some FEHB plans will waive deductibles or copays if you have both
If you skip Part B:
- FEHB remains your primary payer
- You avoid the monthly premium, but may pay more in copays or coinsurance
- You must enroll later with caution, or face lifetime penalties
There’s no one-size-fits-all answer — but we help you review your current plan, expected health needs, and costs to make the best decision.
What Happens to FEHB in Retirement?
You can keep your FEHB coverage for life, as long as:
- You were enrolled for the 5 years prior to retirement, or
- You were covered by a federal spouse’s plan for 5 years
Even after you enroll in Medicare, you do not need to cancel FEHB. In fact, many retirees keep FEHB as supplemental coverage to Medicare — giving them one of the most comprehensive health packages available in retirement.
Some even switch to lower-cost FEHB plans after enrolling in Medicare to save money while still having strong coverage.
What About Medicare Advantage (Part C) or Part D?
Most federal retirees do not need Part D (prescription coverage), since FEHB plans already include robust drug benefits.
Medicare Advantage (Part C) is a private alternative that combines A, B, and sometimes D. It can be appealing to private-sector retirees, but for federal employees, FEHB typically provides stronger, more flexible coverage.
Unless you’re giving up FEHB entirely (rare), Advantage plans are not usually recommended.
How We Help
During your retirement consultation, we:
- Review your FEHB plan and cost structure
- Compare your options with and without Medicare Part B
- Help you understand timelines and enrollment periods
- Make sure you don’t accidentally trigger penalties or lose coverage
We don’t just give you a yes/no answer — we walk through the actual cost and coverage differences based on your situation.
Plan Ahead, Avoid Surprises
Medicare decisions can have long-term impacts on your coverage, costs, and peace of mind. The best time to review your options is before you turn 65, especially if you’re retiring around that time.
We’re here to help you navigate it — clearly and confidently.
