13 FEHB Open Season Tips

  • Getting "Free" Health Insurance—Some Consumer-Driven and High Deductible FEHB plans provide you a savings account larger than your actual premium cost after taxes. You can end the year with more money than you started if your medical costs are low.
  • Avoid a Big Risk—Many people who are covered by their spouse's insurance drop FEHB coverage. This saves premium costs. However, if you are not enrolled and die suddenly, your spouse cannot ever enroll again. Your best option is to carry an FEHB family policy and drop the spousal insurance.
  • Protect Your Retirement—It is not expensive to enroll in the FEHB program for the five years before retirement. Several plans have annual premiums below $2,000. These plans cost only about $1,400 after tax savings. Some plans give you savings accounts higher than the tax advantaged premium cost.
  • Be Sure to Elect a Survivor Annuity for Your Spouse—If you die and your spouse receives no Federal pension, your spouse will lose FEHB coverage forever. If you die while enrolled as self-only, your spouse will also lose coverage.
  • Be Wary of Misleading Catastrophic Cost Protection Claims in Plan Summaries—Some plans exclude deductibles, physician copayments, or drug costs in the figure they claim for catastrophic limits. This can understate your risk by thousands of dollars.
  • Bargain with Out of Network Providers—Most plans have very low payments for non-preferred providers. You MUST negotiate with these doctors before any expensive procedure to protect yourself. One good tactic is to ask for either their "preferred" or Medicare rate.
  • Check Your Brochure—Do not stay in the same plan without reading at least "How We Change" for next year or join a new plan without checking any benefits of importance to your health care.
  • Flexible Spending Account—Less than 20% of active federal employees have an FSA, a for-sure way to save money on qualified health care expenses. You can only establish your FSA during Open Season. Be sure to carefully consider this important option to reduce your health costs. All active employees should set up an FSA (employees enrolled in an HDHP with HSA can set-up a limited expense FSA for dental and vision expenses).
  • Huge Annuitant Cost Savings - The best two arguments for paying the Medicare Part B premium used to be to preserve your choices over time, as both the FEHB program and Medicare evolve, and to get you low costs for providers who are not in your plan network. This choice is costly in most but not all FEHB plans. But it has been overtaken by a key event: the growing number of plans that offer a Medicare Advantage option that not only pays most of the Part B premium, but that also holds your medical care expenses to zero, besides prescription drugs, whether you use network providers or not.
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  • Dealing with a Known High Expense—There is an exception to our general advice about focusing on overall plan costs, not just one benefit category. If you know for sure that you will need an expensive service, you should look for the answer to "Which plans pay best?" If several plans pay equally well, then you can choose whichever of these is an overall better buy.
  • Check to See Which Enrollment Option is Less Expensive—Couples and two-person families should check to see if it's less expensive to enroll as self and family or self plus one. Most of the time, self plus one is less expensive. However, in 2024, there are 49 FEHB plans where self and family is less expensive. 
  • Using High Deductible Health Plans for Lifetime Financial Rewards—HDHP plans provide Health Savings Accounts that are superb investment vehicles in which you can contribute tax free, invest your savings balances for tax free growth, and take out what you need for health care costs tax free. The results are simple if you make voluntary contributions for a few years, use your growing savings account to pay the deductible in any bad years, and keep the growing surplus available for tax free withdrawals if you ever need it for health care expenses or long-term care.
  • Combining your strategies—Most of these strategies can be combined. For example, use a HDHP for most of your working years, but carefully switch temporarily to a conventional plan each year you plan to have a baby and quickly return to your HDHP after each child is born, select an FSA to augment these plans (a limited expense FSA for dental and vision expenses only), and switch to one of the plans that pays your Part B premium and all your medical expenses in retirement, paying the FEHB premium with a small draw from your HSA account.
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