Advice for Persons Who Pay Full FEHB Premiums
The FEHB program also provides coverage for former spouses, former employees, children turning age 26, and others. In each of these cases, the covered enrollee must pay the full premium without government contribution. This often results, nonetheless, in a better price than is available for non-group insurance purchased individually, which is the only other insurance available to some. In most cases, however, a marketplace exchange option is worth considering and for those eligible for premium tax subsidies is often a better buy.
Persons eligible for continuing coverage for as long as needed include:
- Those former spouses who have a qualifying court order and meet other conditions. They may enroll in any plan on the same basis as employees and annuitants, except for premiums.
- Temporary employees who have worked for one full year also may enroll on the same basis as employees, except for premium cost. (Such employees should switch to permanent employment if at all possible to reduce premium costs by three-fourths.)
Time-limited coverage is also available for several categories of persons. They pay a small surcharge—two percent of the premium—and are eligible only for a limited time:
- Employees separating from Federal service for any reason may continue their coverage for 18 months.
- Children reaching age 26 are, unless severely handicapped, no longer eligible for coverage under their parents' family plan. They may obtain coverage in their own name for 36 months.
- Former spouses without a qualifying court order also may enroll for 36 months.
For all purposes except premium contribution, tax shelter, and time limit, a temporary enrollee is treated like a regular enrollee. For example, there is no disqualification for preexisting conditions. There is a 60-day time limit for applying after the qualifying event, but once enrolled a person may switch plans in the next Open Season just like any employee or annuitant. At the end of the temporary period, these persons may switch to a "conversion" plan that is not part of the FEHB program and is sold at individual rather than group rates. However, the costs and coverages of these conversion plans are generally far worse than one can get by shopping on the private market. Some young adults will not have a parent with a family plan or will become ineligible for family coverage upon reaching age 26. You can usually (but not always) get better deals from marketplace exchange plans than you would from paying full premiums for the regular FEHB plans but must pay careful attention because bronze and silver plans have much higher deductibles and cost-sharing features than FEHB plans.
For persons who pay full premiums, we compare plans based on paying both the government and employee share. Although some of these persons must pay a two percent surcharge, we have omitted this factor to avoid the need for extra tables. Under any of the less-costly plans, the surcharge would be under $100 per year for singles and $200 per year for families. These tables do not include premium tax savings because persons who are not current employees are not eligible for this benefit.