Ever think about what your spouse will do for health insurance after you’ve gone? He or she has been part of your family plan and they can continue coverage for life, provided you elect a survivor annuity for your spouse.
According to Checkbook’s Guide to Health Plans for Federal Employees,” if you die and your spouse receives no federal pension “your spouse will lose [Federal Employees Health Benefits Program] health insurance coverage forever. If you did while enrolled as self-only your spouse will also lose coverage.”
Monday is the last day feds and retirees can pick their 2019 health plan. If they don’t switch they will be continued in their current health plan even if their doctors may have left their network, premiums have jumped and benefits have been cut.
Checkbook expert Walton Francis said catastrophic coverage is the reason people buy health insurance, or that it should be. The catastrophic, or limit-to-you, coverage is the maximum you will be required to pay out of pocket next year if you or the family have a major medical issue or are involved in a serious accident.
Read the fine print. The Checkbook warned about “misleading catastrophic cost protection claims” in plan summaries. “Some plans exclude deductibles, doctor co-payments or drug costs in the future they claim for catastrophic limits. This can understate your risk by thousands of dollars.”
For huge retiree cost savings, Checkbook said “Annuitants with Medicare Parts A and B can suspend (not drop) their FEHBP enrollment, join a Medicare Advantage plan and pay only their Medicare premium. They can re-enroll in an FEHBP plan in the future without penalty, and in the meantime, enjoy good catastrophic protection, have low copays and save thousands in premium costs.”
Read up on the five-year rule. If you’re piggybacking on your private sector spouses health plan, you could lose your ability to go into the FEHBP when you retire from your federal job.
Want to avoid health care bankruptcy? The leading cause of bankruptcy in the U.S. is medical costs, which is why you need to know your health plan’s catastrophic coverage limits.