valzan/Shutterstock.com

A Little More Cash During Open Season

Five ideas for saving yourself some benefits bucks.

Open season for federal health benefits is right around the corner: It starts Nov. 10 and runs until Dec. 8. When you hear the words “open season,” what thoughts come to mind?

How about: Stirring, exciting, thrilling, rousing, sensational and exhilarating?

Or is it more like: Tiresome, mind-numbing, monotonous, tedious, boring and dull?

Open season is your chance to enroll, review, change or terminate your participation in the following programs:

  • Federal Employees Health Benefits Program
  • Federal Employees Dental and Vision Insurance Program
  • Federal Flexible Spending Accounts

Those don’t sound like exciting things to think about, I must admit. However, what if I told you that open season is like mining for gold or finding lost cash or using a metal detector to discover a diamond ring on the beach? That’s a little more exciting, right?

Open season can be an opportunity to put a little more cash in your pocket. Here are five ideas that might help you do just that.

Contribute to a Flexible Spending Account

If you’re an eligible federal employee, you can sign up. If you’re already contributing, but not at the maximum level, then consider increasing your contributions -- assuming you’ll incur enough out-of-pocket expenses next year to justify the increase. Lowering your taxable income by contributing $2,500 to an FSA can boost your take home pay by:

  • FICA tax: 6.2 percent of $2,500 = $155
  • Medicare tax: 1.45 percent of $2,500 = $36.25
  • Federal income tax (varies based on your marginal tax bracket): 28 percent of $2,500 = $700
  • State tax (varies by state): 6 percent of $2,500 = $150

There are both health care and dependent care FSA options.

Consider a High Deductible Health Plan or a Consumer-Driven Health Plan

Even though these plans have high deductibles, they also have among the lowest premiums of all federal health plans. And you’ll receive contributions in the form of a premium pass-through or a medical fund to help pay for out of pocket expenses. With a high deductible plan you may also be eligible for a health savings account, into which you can contribute up to $3,350 for self-only coverage or $6,650 for self-and-family enrollment -- all tax-free. Enrollees over age 55 can contribute an additional $1,000 to their HSAs.

The contributions that you make to an HSA will lower your taxable income. And when the money is spent on eligible medical expenses, it comes out tax-free. The account belongs to you and will accumulate from one year to the next. You will earn interest on your balance and may be eligible to invest some of the money in a variety of investment options. You also may be eligible to contribute additional tax-free contributions to an FSA or a limited expense FSA if you are in a high-deductible health plan.

Enroll in Medicare Part B

Are you retired or approaching retirement and also are 65 or older? If so, you should at least consider enrolling in Medicare Part B (as well as Part A) and change your federal health plan to lower your FEHBP costs and also eliminate most of your deductibles, copayments and coinsurance.

If you choose carefully, you can find a federal health plan that has low premiums and will waive most of your out-of-pocket medical expenses (other than prescriptions and dental and vision expenses) when Medicare is the primary payer. Many FEHBP plans offer incentives for retirees to enroll in Part B. Check out Section 9 of your plan brochure.

Medicare will generally be your primary insurance if you are paying your FEHBP premiums out of your CSRS or FERS retirement benefit. If you are 65 and still paying your premiums out of your paycheck because you are working, then Medicare will be the secondary payer to your FEHBP plan.

There’s a new plan this year called Aetna Direct designed specifically for retirees with Medicare A and B. Other FEHBP plans also provide benefits for retirees who are enrolled in parts A and B.

Change Your Health Plan

The cost of plans is not necessarily an indication of their quality. Costs are determined by a number of factors related to how much the plan must pay out to its enrollees. For example, if a plan attracts older retirees who fill a lot of prescriptions, it may have higher premiums due to the expense of a generous prescription drug benefit. Find out more about all of the plans you are eligible for here.

Biweekly premiums for self-only fee-for-service plans range from $43.10 to $137.88.  Biweekly premiums for self-and-family fee-for-service plans range from $93.59 to $351.89.  Potential savings (comparing the highest priced plan to the lowest) are:

  • $2,464.28 per year for self-only plans
  • $6,715.80 per year for self-and-family enrollments

Consider Changes in Other Benefits

Although this open season is not directly related to life insurance, it might be a good time to review your life insurance coverage. If you are carrying Option B of Federal Employees Group Life Insurance, (which is based on multiples of your federal salary up to five times your basic pay rate), the premiums almost double when you turn 55.  The costs will more than double again when you turn 60. At age 55, $300,000 of FEGLI Option B costs $1,792 per year. That goes up to $4,057 a year at 60.

The premiums continue to increase until age 80 unless you choose to lower your coverage while you are employed or take a full reduction of the coverage when you retire.

For More Information

If you’d like to learn more about your choices this open season, consider signing up for the three-part webinar series that I’m conducting with Micah Shilanski. You also can tune in to the series of “For Your Benefit” programs on Federal News Radio that I co-host with Bob Leins. These shows air on Mondays at 10 a.m. on AM 1500 in the Washington area and also are archived online.

This year’s open season programs will include:

  • Nov. 10: Walton Francis, author of the Checkbook Guide to Federal Health Plans
  • Nov. 17: SAMBA FEHBP and FLTCIP
  • Nov. 24: Aetna FEHBP
  • Dec. 1: Kaiser FEHBP
  • Dec. 8: Open Season Wrap-Up

(Image via valzan/Shutterstock.com)

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.