Federal Retirees Who Skip This FEHB Step Often Lose Coverage Right When They Need It Most

Key Takeaways

• If you retire without meeting a specific FEHB requirement, you could permanently lose your right to continue health coverage under the program.

• Keeping FEHB into retirement requires at least five years of continuous enrollment and active participation right up to your retirement date.

What FEHB Does for You in Retirement

The Federal Employees Health Benefits (FEHB) Program offers one of the most stable and comprehensive health coverage options for public sector retirees. Unlike private insurance, it remains available for life if you meet the right conditions before retiring. But this isn’t automatic. Retirees who overlook one crucial eligibility step often find themselves without health coverage at the worst possible time—when they can no longer qualify or re-enroll.

FEHB offers government employees the ability to carry their health insurance into retirement. Once you’re eligible, the government continues to pay roughly 70% of your premium, just as it did during your working years. This makes the program one of the most financially secure options available to federal and postal retirees.

However, continuing FEHB into retirement hinges on meeting a requirement many overlook until it’s too late.

The 5-Year Rule: What It Is and Why It Matters

To continue FEHB into retirement, you must have:

• Been continuously enrolled (or covered as a family member) in an FEHB plan for the five years immediately before retirement, and

• Be enrolled in the FEHB program on the date of retirement.

There are no exceptions for partial service or gaps in coverage. If you drop FEHB at any point during that five-year window, even for a short time, you risk losing eligibility permanently.

Here’s what counts:

• Enrollment in any FEHB plan (not just the one you retire with) counts toward the five-year minimum.

• If you switched between Self Only and Self Plus One or Self and Family, the coverage still counts.

• If you were covered as a dependent on a spouse’s FEHB plan, that also counts, but documentation will be required.

What does not count:

• Tricare or private insurance enrollment

• Temporary coverage under FEHB after a separation (such as TCC)

• Periods when you opted out of FEHB entirely

How OPM Evaluates FEHB Eligibility at Retirement

When you submit your retirement application, the Office of Personnel Management (OPM) verifies your FEHB enrollment history through your employing agency’s personnel records. If your records don’t confirm continuous enrollment for the five years before your retirement, OPM will deny continued coverage.

This evaluation is strict. There is no appeal based on intent, health condition, or misunderstanding of the rules. The requirement is based solely on actual enrollment records.

If your eligibility is denied, you’ll be dropped from FEHB permanently unless you later return to federal service and re-establish eligibility through five new years of coverage—a nearly impossible path for most retirees.

What If You’re Not Yet at the 5-Year Mark?

If you’re considering retirement and don’t yet meet the five-year requirement, you still have time—but you must act with precision.

Steps to Take:

• Check your FEHB enrollment history by contacting your HR office and verifying your Standard Form 2809 and electronic records.

• Avoid dropping FEHB coverage, even for short periods or during special enrollments elsewhere.

• Coordinate with your planned retirement date to ensure you’ll have five full years of coverage the day you file for retirement.

Even a few months short could mean you lose the ability to carry your health benefits with you.

Can You Retire Without FEHB and Rejoin Later?

In most cases, no. Once you retire, you cannot enroll in or rejoin FEHB unless you meet the five-year test. There are limited exceptions, such as returning to federal employment and completing a new five-year coverage period, but that rarely applies.

There is also no provision for Medicare enrollment alone to restore your FEHB rights. FEHB and Medicare can work together in retirement, but one cannot substitute the other. Medicare Part B is optional (with penalties if delayed), but FEHB continuation is strictly conditional.

What Happens to Your Dependents?

If you meet the five-year FEHB rule and continue coverage into retirement, your eligible dependents can remain covered under your plan.

That includes:

• Spouse

• Children under age 26 (or older if disabled before age 26)

But here’s the catch: if you lose eligibility or drop FEHB, your dependents lose their coverage too. They cannot retain the plan on their own unless they are federal employees themselves.

Survivor Annuity Elections and FEHB

If you plan to provide continuing FEHB coverage to your spouse after your death, you must:

• Elect at least a partial survivor annuity for your spouse, and

• Be enrolled in a Self Plus One or Self and Family FEHB plan at the time of your death

If you don’t meet both conditions, your spouse will lose FEHB access permanently upon your death—even if you had coverage during retirement. This is one of the most overlooked post-retirement issues for surviving spouses.

FEHB Suspension: A Cautionary Option

Some retirees may consider suspending FEHB to enroll in other coverage, such as Medicare Advantage or CHAMPVA. OPM does allow this—but it’s a one-way street unless the other coverage ends.

You may:

• Suspend FEHB (not cancel it) for approved programs.

• Resume FEHB later, but only if the non-FEHB coverage ends through no fault of your own (e.g., plan cancellation or eligibility loss).

You cannot resume FEHB just because you changed your mind or preferred the original plan again.

Suspending FEHB could save costs temporarily, but it’s a strategic move that must be carefully timed and documented.

Planning Around Medicare and FEHB

When you turn 65, you become eligible for Medicare. Many retirees choose to enroll in both Medicare Parts A and B, then use FEHB as secondary coverage. This often lowers out-of-pocket costs.

But even with Medicare, keeping FEHB is crucial. It offers:

• Broader provider access

• Continued coverage for services Medicare doesn’t cover (like overseas care)

• Prescription drug benefits that may rival or exceed standalone Part D plans

In 2025, many FEHB plans integrate well with Medicare, offering reduced deductibles and copayments for retirees who enroll in Part B.

But none of these benefits apply if you failed to maintain FEHB eligibility at retirement.

Why the 5-Year Rule Isn’t Waived

Despite ongoing discussions among federal retiree advocacy groups, the five-year rule remains firmly in place. The rationale is to avoid opportunistic enrollments, where individuals drop FEHB during their healthy working years and rejoin only when retirement or illness approaches.

Congress and OPM have consistently upheld the requirement to maintain stability and predictability in the risk pool.

As of 2025, there is no pending legislation or regulation that would change the rule. Retirees must plan according to current policy.

Don’t Leave It to Your Final Year

Many federal employees assume they’ll “deal with FEHB” near their retirement year. But by then, your options may be limited or nonexistent.

Start reviewing your FEHB status no later than five years before you expect to retire. That means if your target date is January 2030, your five-year clock starts no later than January 2025.

Work with your HR office to:

• Verify eligibility

• Resolve any gaps

• Ensure your personnel file accurately reflects your FEHB enrollment

A mistake caught early can be corrected. A mistake caught after separation is usually permanent.

Protecting Your Coverage Before and After Retirement

Your FEHB decision is not just about premiums or plan type. It’s about eligibility, timing, and long-term strategy.

Take proactive steps:

• Keep continuous enrollment

• Review plan types each Open Season

• Choose a retirement date that keeps you within the FEHB eligibility window

Your future health coverage depends on decisions made now, not later.

Make Sure Your Retirement Plan Includes This Critical Detail

Health coverage is one of the most expensive and important components of retirement. Losing access to FEHB at retirement due to an overlooked rule can derail even the best financial strategy.

You can’t assume eligibility. You must confirm it, document it, and plan around it. It’s not enough to participate in FEHB for most of your career—you must meet the five-year enrollment window up to your retirement date.

If you’re even slightly uncertain about your FEHB status, now is the time to verify. Speak with your agency’s benefits officer, and get in touch with a licensed professional listed on this website who can help you make the right decisions.