
August 12, 2025
FEHB Health Insurance in Retirement: What Every Federal Employee Needs to KnowThe Federal Employee Health Benefits (FEHB) program is one of the most valuable retirement benefits for federal employees, but understanding how it works after you leave service is key to maximizing its value. To keep FEHB in retirement, you must retire on an immediate annuity and have been enrolled for the five years before retirement. The government continues to pay most of the premium, but retirees lose the pre-tax advantage, making premiums feel more expensive. While pensions receive annual cost-of-living adjustments, they often lag behind the faster rise in FEHB premiums, creating long-term budgeting challenges. Coordinating FEHB with Medicare—especially Part B—can provide broad protection, with FEHB acting as a “super supplement” for services Medicare doesn’t cover, but the decision depends on personal health, income, and risk tolerance.