Posted on Friday, 29th September 2023 by Dennis Damp

Long Term Partners, LLC sent their 2023 enrollee decision period offer letter on September 11. We have until November 9, 2023 to either accept the offer listed under Option 1 or submit a selection form changing coverage to option 2, 3 or 4. If Long Term partners doesn’t receive an election from by this date, your premium increase for Option 1 will increase effective January 1, 2024.

The acronyms they frequently use are confusing, the first time a new acronym is mentioned I highlight it in bold so you can easily refer back to it as you progress through the article. Maybe it’s my age, I find it difficult reading anything laced with so many abbreviations.

Then and Now

I applied for Long Term care insurance when it was first offered as a benefit in December of 2002. Our combined initial premium for the Future Purchase Option (FPO) was $73.57. I was 52 at the time and our 5 years of coverage provided a total benefit of $228,125, $125 per day.

Currently our premiums are $222.08 monthly, $115.05 for me and $107.03 for my wife, over a 200% increase from our initial 2003 premiums. Our Daily Benefit Amount (DBA) is $228.21 with a $249,889 Maximum Lifetime Benefit (MLB). Still not enough to fully cover nursing home care we may need.

In 2016 premiums increased dramatically, we opted to retain our lower FPO premiums and agreed to a reduction in the daily rate and reduced our coverage from five to three years. We could have changed to the Automatic Compounded Inflation Option (ACIO), the cost was almost 4 times what we were paying at the time! Many were enticed to switch to an ACIO plan and can’t revert back to the FPO option after making that election.

Coverage

Under my FLTCIP 1.0 plan, nursing home care, assisted living care, and hospice care in a facility is covered up to 100% of your daily benefit amount (DBA).

In addition, comprehensive coverage also includes hospice care at home covered up to 100% of your DBA or weekly benefit amount (WBA) and home care and adult day care covered up to 75% of your DBA or WBA.

Informal care provided by friends and family members is covered up to 75% of your DBA or WBA, limited to 365 days for family members. Informal caregivers are covered as long as they did not live with you at the time you became eligible for benefits.

Enrollees are entered into one of three programs, FLTCIP 1.0, 2.0 or 3.0, depending on the date they enrolled.

Benefit Booklets:

• FLTCIP 1.0 Benefits Booklet
• FLTCIP 2.0 Benefits Booklet
• FLTCIP 3.0 Benefits Booklet

2024 LTC Rates

This year, under the FPO plan, I received a letter offering the following four options:

1. Accept FPO offer and pay premium increase
2. Decline the offer and pay premium increase
3. Reduce benefit amount to help keep premium at or near its current level
4. Choose paid-up, limited benefit; no future premiums due

Option one’s benefit amount for my wife and I would be $237.84 daily for 3 years with a maximum benefit of $260,434. My premium would be $163.06 per month and Mary’s $153.23 for a total of $316.29, a 42% increase!  This change only provides a 4.22% increase in benefits above what we currently have.

Seems like a lot for a small MBA increase of just $10,000 and DBA increase of less than $10!

With the previous January of 2022 increase, Option 2 allowed you to decline the FPO with a small DBA decrease and the premium was slightly reduced. For 2024, if I decline the FPO offer, my premium increases 30% and my DBA amount and MLB benefit decreases!

Option 3 reduces the benefit amount and Maximum lifetime benefit to retain close to the premiums I’m currently paying. We did this in 2016 and if we did it again, I’m not sure it is worth keeping, knowing full well that additional increases will further erode our benefits.

Option 4 reduces our coverage to $228.21 daily with a maximum lifetime benefit of only $15,847.

The Automatic Compounded Inflation Option (ACIO) Election

With this option, your DBA and remaining portion of your MLB will automatically increase by 3% compounded every year. The increases under this option are made even if you are eligible for benefits, without regard to your age, claim status, claim history, or the length of time your coverage has been in effect.

Your premium does not increase annually as a result of this annual increase in benefits. However, premiums are not guaranteed. With long term care costs continuing to rise almost every year, you may want to consider the automatic compound inflation option (ACIO). The initial premiums are higher than the future purchase option because you are prefunding automatic future benefit increases that are designed to help keep pace with inflation.

If you have the Future Purchase Option (FPO), you can opt for the ACIO inflation adjusted rates without providing evidence of your good health. This is considered a coverage increase and is more expensive than the FPO option. The additional premium for the increase in coverage will be calculated using your age as of January 1, 2024 and will no longer receive FPO offers.

Long Term Care Average Costs

The cost of long-term care varies based on several factors including the care setting, location, level of care required, among other things. You can use Nationwide’s Long Term Care national calculator to determine average costs in your state.

National annual median long-term care costs: (Excerpted from aplaceformom.com)

• In Home Care $60,000 ($5,148/month, $169/day, $27/hour)
• Assisted Living $57,912 ($4,500/month, $148/day)
• Adult Day Care $20,280, $1,690/month, $78/day)
• Nursing Home
  • Semi-Private Room $94,900 ($7,908/month, $260/day)
  • Private Room $108,405 ($9,034/month, $287/day)

The duration and level of long-term care according to LongTermCare.gov varies from person to person and often changes over time. They list the following average need:

• Someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and support in their remaining years
• Women need care longer (3.7 years) than men (2.2 years)
• One-third of today’s 65-year-olds may never need long-term care support, but 20 percent will need it for longer than 5 years

Contacting Our Long-term Care Provider

Call 1-800-582-3337 for clarifications and to change your coverage or visit their online site at www.LTCFEDS.com .

• FLTCIP Help

Many insurers have dramatically increased premiums for Long Term Care and others are no longer offering this coverage.

Other Options & Resources

• Some private sector providers are combining insurance policies with a long-term care rider and others offer deferred-income annuities if appropriate for your situation. Lincoln Financial offers a Money Guard policy that combines both.  According to Lincoln Financial, “Unlike traditional long-term care insurance, your policy costs are set at issue and will never increase. Your policy provides benefits, even if you never need care, provided all planned premiums are paid.”
• Money.com recently featured the Best Long-Term Care Insurance Companies of September 2023 on their site. They cover traditional LTC and hybrid policies with LTC riders for you to explore.
• Research senior living facilities in your area at https://www.aplaceformom.com/.

The 90-day waiting period

If you enter a nursing home the average cost of a semi private room is $7,908 a month today, the first three months are on you. You will need $23,724 to cover this waiting period. After that, your long-term insurance will pay the bills up to your insured daily amount.

You will have to pick up the tab for any charges above your coverage limits. You only need to satisfy the 90-day waiting period once during your lifetime. If you stay at an assisted living facility first for 30 days and then enter a nursing home, you would only have to wait 60 days since you already had 30 days at an assisted living facility according to the FLTCIP customer service representative that I talked to.

Medicare Misconception

Many believe that Medicare and your FEHB plan will cover long-term care costs. Medicare states on page 55 of their 2024 guide, “Medicare and most health insurance plans, including Medicare Supplement Insurance (Medigap) policies, don’t pay for this type of care.”

Suspension Period for FLTCIP Applicants

As of December 19, 2022, individuals not currently enrolled may not apply for coverage, and current enrollees may not apply to increase their coverage. The suspension will remain in effect for 24 months, unless OPM issues a subsequent notice to end or extend the suspension period.

Current enrollees’ coverage status will not change as long as they continue to pay premium. For those in a claim status, there is no change to coverage or the claims reimbursement process as long as benefits have not been exhausted.

Summary

Personally, my concerns are twofold. I want my wife and I to have dignified care in a professional, clean, and caring facility and at the same time I don’t want to bankrupt our estate in the process. These high costs can easily drain your bank accounts, and investments.

A long-term care policy helps to reduce the financial stress to a manageable level. Your family won’t have to worry about where the money is coming from.

Federal employees and annuitants that are confronted with large premium increases should contact FLTCIP to discuss their options for reducing costs. Research other long-term care options NOW.

If I was younger, and hadn’t already spent tens of thousands of dollars on LTC premiums, I would seriously consider a hybrid policy with a LTC rider. These policies weren’t available when I first signed up for coverage.

When you consider that 30% of those over 65 may never need this care, it makes sense to explore insurance programs that offer something back for all the years you paid premiums.

The younger you are when you apply the lower your monthly premium, start early to research your options. My premiums are lower because I took out our policy when I was 52.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

Disclaimer: The information provided may not cover all aspect of unique or special circumstances, federal regulations, medical procedures, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance including OPM’s retirement center. Over time, various dynamic economic factors relied upon as a basis for this article may change.

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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Posted on Thursday, 28th September 2023 by Dennis Damp

The annual Federal Benefits Open Season 2023 starts on November 13 and is open through December 11, 2023. FEHB participants can review all available plans and change their health, vision and dental enrollments for the 2024 benefit year.

The overall average FEHB premium is increasing 7.7% for plan year 2024 and the new rates were announced this week. The overall FEDVIP average premium for dental plans is increasing by 1.4 percent, and the average premium for vision plans will increase 1.1 percent.

The premiums for non-postal employees and annuitants enrolled in FEHB will increase by 5.8%, when accounting for the average increases for both the government’s, and participant’s share of the cost. The government is contributing 5% more toward FEHB premiums starting next year.

Blue Cross Blue Shield Basic to GEHA Standard

I checked the premiums for the self-plus-one Blue Cross Blue Shield (BCBS) basic (113) and Government Employees Health Association (GEHA) standard (316) plans. BCBS monthly premium increased $44.91 to $517.03 while GEHA’s premium increased $6.40 to $326.79.

The annual increases are $538.92 for BCBS Basic and $76.80 for GEHA Standard. BCBS basic increased 9.5% while GEHA standard increase only 1.9%.

OPM will post the new 2024 plan brochures in October. Major providers may already have them available. I called GEHA and they are sending out the new 2024 guide in two weeks.

You will be able to compare your current plan to several hundred health plans available for 2024.

Medicare Advantage Plans (Heads Up for the Upcoming Open Season)

Medicare Part B Premiums

In March, Medicare Trustees forecasted monthly Part B premiums would increase to $174.80 in 2024 from $164.90 this year, a 6% increase. The new rates will be announced soon and they could be higher now that a new high-cost Alzheimer drug was approved for the Part D Medicare program.

Summary

Explore lower cost FEHB plans to offset high costs elsewhere. This is especially true for those with Medicare. Your FEHB plan becomes your secondary coverage and they cover many of the costs Medicare doesn’t, including copayments, coinsurance and deductibles.

• Should You Change to a Lower Cost FEHB Plan When You Sign Up for Medicare

Use the tools available to compare plans and ensure the plan you select meets your needs throughout the year ahead.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

Disclaimer: The information provided may not cover all aspect of unique or special circumstances, federal regulations, medical procedures, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance including OPM’s retirement center. Over time, various dynamic economic factors relied upon as a basis for this article may change.

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in UNCATEGORIZED

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Posted on Friday, 22nd September 2023 by Dennis Damp

Good news for those planning their retirement and annuitants. OPM’s retirement center has improved considerably over the past few years. When I retired 18 years ago, their online support was a shadow of what it is today, this is why I developed and published the Federal Employee’s Retirement Planning website in 2004.

When I was researching retirement, I couldn’t find the answers I needed to make informed benefit decisions and wanted to share my research and experiences with others. I also relate experiences of many of our site visitors, newsletter subscribers, and from those who comment on our blog postings.

That is one of the principal differences between OPM’s offerings and ours along with many other service providers in this space. It’s reassuring to read about retirement issues from those who are retired and have navigated the same waters as our site visitors.

First Things First

OPM manages our retirement services and they are the only ones that can make desired changes once you leave federal service. Prior to retirement, federal employees must contact their human resources (HR) office to make benefit changes and to initiate their retirement paperwork. The HR office will also provide annuity estimates for several target retirement dates. I took advantage of that service before completing my paperwork.

OPM’s Expanded Offerings

Explore OPM’s Online Retirement Center to research the retirement process, benefits, and to use their various online calculators. It’s also a resource for survivors who need to contact OPM after their loved one dies or to clarify benefit issues.

They recently added a Retirement Quick Guide that is very useful with step-by-step instructions on what to do and when, with timelines for you to follow. This guide starts with an overview of how your retirement is processed, and lists four things to do before retiring: sign all forms, download your personal records, complete payments for any open service credit accounts, and check supplemental documents needed for them to process your claim.

They continue on with benefit explanations, factors that might delay your retirement processing, and how to track your application as it proceeds through the system.  Key terms are explained and helpful resource links are provided to get you signed up for their retirement online services.

Quick Reference Guide

There are numerous links provided for everything from retirement system fundamentals, eligibility guidance for the FERS and CSRS retirement systems, and links to publications and forms of interest. These centralized offerings help you navigate what often seems overwhelming to those approaching retirement. They recently published several videos to help new retirees access OPM Services Online.

The Down Side

Many get frustrated when trying to contact OPM by phone concerning critical issues that aren’t easily resolved online and need immediate attention. Many, especially the older generation of which I am now a member, don’t have online access or care to.

OPM is trying to minimize calls with their expanded online offerings; hopefully once the majority of retirees are aware of these services, those who need to talk with someone won’t have the problems they are having today. When I call their support number at 1-888-767-6738 and get through, wait times are often 45 minutes or longer.

Summary

The main reason for developing federalretirement.net was to provide a resource for federal employees and retirees because OPM’s support was inadequate at the time. Their service is improving however there is still room for ancillary services like federalretirement.net to fill in the gaps when it comes to personal perspectives, recommendations, and insight into complex issues.

One of our site visitors put it best, “I spent 3 hours on the web looking for answers to questions concerning federal retirement. After a Google search yielded your address, it took only 20 minutes to find all of my answers! Thank you!!!”  Rod H.

OPM administers the Civil Service Retirement System (CSRS) and the Federal Employee Retirement System (FERS), serving 2.5 million Federal retirees and survivors who receive monthly annuity payments. It’s a huge undertaking and they are taking steps to improve. However, retirees and survivors must still have access to specialists to handle critical and sensitive issues that need immediate attention. Hopefully, their expanded online initiatives will reduce call volume and improve service for all.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

Disclaimer: The information provided may not cover all aspect of unique or special circumstances, federal regulations, medical procedures, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance including OPM’s retirement center. Over time, various dynamic economic factors relied upon as a basis for this article may change.

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: Benefits, CSRS, FERS, OPM Retirement Center, Survivor Benefits
Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Posted on Friday, 15th September 2023 by Dennis Damp

According to Wilbert J Morell III, a retired Navy Engineering Project manager, “based on the September economic outlook, the CPI-W is expected to increase above 0.6%, Wilbert predicts the Social Security & CSRS COLA will be 3.4% and the FERS COLA 2.4%.”

The estimates increased about a half of a percent since our first article on this subject last April. Wilbert tracks this data monthly and compiles a comprehensive spreadsheet for these statistics.

USA Today estimates a 3.0% COLA next year and Kiplinger is in the same range. Inflation increased by 0.6% in August to 3.8% for the past 12 months and the CPI increased by 0.4%. The COLAs issued from 1999 to the present are available for your review.

Rising Prices

Inflation has moderated a bit, yet I believe it isn’t going away anytime soon. Prices are driven higher across the board due to continuing supply chain issues, higher oil prices, insurance costs, contract negotiations within major industries that are driving salaries up dramatically, and escalating housing and rental costs for example.

According to CNBC, “UPS CEO said drivers will average $170,000 in pay and benefits such as health care and pensions at the end of a five-year contract that the delivery giant struck with the Teamsters Union last month.”

They also state, “But that isn’t the only job at UPS that doesn’t require a bachelor’s degree and pays six figures; tractor-trailer drivers earn $162,000 on average ($112,000 plus $50,000 in benefits) and long-haul drivers earn $172,000 on average ($122,000 plus $50,000 in benefits).”

The United Auto Workers are asking for a mid 30s percent pay raise with a 32 hour workweek and pay for 40 hours. American Airlines pilots negotiated a 46 percent increase earlier this year and other unions have won or are seeking similar increases across the board.

The costs of everything will be higher considering inflation still rages and these pay increases must be offset with higher prices. For retirees, “hanging on to what we got” may be harder than you think as our buying power evaporates. We have to maximize our returns as best we can to keep up. COLAs alone won’t do the job for us.

Treasury Bill Yields Continue to Rise

In my article titled “Ditch your Bank’s Low Savings Rates” I described the advantages of Treasury bills (T Bills) and in a subsequent article I outlined how to ladder them to take advantage of the rising rates. What continues to astound me is that my local bank has kept their standard savings rate of .04% up to 1% for what they call a relationship APY!

When I started purchasing T-Bills in February of 2022 they were yielding slightly more than my local bank and credit union savings rate. The 4-week bill rate has increased to 5.390% as of September 9, 2023, 8-week bills now yield 5.423%; the 13-week bill is 5.477%. The rate chart below lists Treasury Bill performance for September of this year.

TREASURY NOTE RATE CHART

Late September the Federal Reserve is expected to announce whether or not more rate hikes are planned this year. Some expect at least one more increase this November.

Many banks continue to take advantage of their depositors knowing they are reluctant to move funds from their savings to higher earning options. A person with $50,000 in his or her bank savings account earning .04% interest receives $20 a year for keeping those funds in the bank. Moving that same amount to a 52-week T-Bill currently earning 5.417% would earn the depositor $2,708.50, or $2,688.50 more than their bank would pay them!

Treasury Bill Purchases

Treasuries bills are purchased direct from the government at www.treasurydirect.gov or through your stock broker. Generally, I purchase short term bills direct from the government. Longer term notes, bonds, and TIPs are best suited for your brokerage account.

If you are holding long term notes, bonds and TIPs, they can only be sold, before maturity, through the secondary market. Treasury Direct canceled their sell direct program some time ago. Owners must transfer Treasuries they want to sell before maturity to their private brokerage account to sell them on the secondary market; it can take months for the government to complete the transfer.

I elect the new issue auction option when purchasing Treasuries through my brokerage account. If you buy previously issued Treasuries you could end up paying a high premium if the newer issued notes and bonds are paying a higher coupon rate.

Earnings Returned to Your Savings Account

Treasury Bills are purchased at discount. In other words, if you buy a $10,000 (26-Week T Bill) earning 5.537%, the Treasury withdraws $9,723.15 from your account. At maturity, 26 weeks later they deposit $10,000 back to your account. If you choose to reinvest, the Treasury deposits the earnings back to your account until the final maturity date when the full amount is returned.

This is confusing to some, in the above example the $10,000 would earn 5.537% or $553.70 if held for one year. When you buy a T-Bill for less than a year the earnings are prorated. In this case you would receive half a year’s interest, $276.85.

Conclusion

I’ll keep 8, and 13-week T-Bills reinvesting for the near term until the rates plateau; then I plan to convert them to either 52-week bills, longer-term notes, or purchase CDs depending on how high the rates move.

Certificates of deposit (CDs) earning close to the T-Bill yields are available if you take time to seek them out. A local bank recently offered 5.25% for a one-year certificate.

Interest rates reached 16.63% in 1981 and many locked in longer term Treasury Notes and bonds at very high rates, in the low to mid-teens!  I’m not sure if those days are coming back but with the cost of most things increases and as of a result of the dynamics mentioned above, who knows how high rates will go.

You can elect to reinvest your T-Bills for up to two years. A 13-week T-Bill can reinvest 7 times and when they renew you pick up the new bond the same day the previous bond matures so you don’t lose any earnings. You buy them at discount so they deposit the difference direct to your designated bank or credit union account and you can watch it grow throughout the year.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: 2024 COLA, COLA, Inflation, T-Bills, Treasury Bill Yields
Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Posted on Friday, 8th September 2023 by Dennis Damp

The Postal Service Health Benefits (PSHB) Program will replace Federal Employees Health Benefit (FEHB) Program coverage for eligible Postal Service employees, Postal Service annuitants, and their eligible family members starting in 2025.

This new separate program, within the Federal Employees Health Benefits (FEHB) Program, is administered by the Office of Personnel Management (OPM). One of the key elements of this new plan is the requirement for those under a certain age to sign up for Medicare Part B to retain their PSHB health care coverage in retirement.

This requirement could be added to
federal employee’s FEHB Plans down the road.

Postal Service Financial Reforms

Public Law 117–108—APR. 6, 2022, provides stability to and enhance the services of the United States Postal Service. Title One, Section 101 establishes the Postal Service Health Benefits Program (PSHB). There are significant changes, especially for those approaching 65 with this new plan.

Eligible Postal Service employees and Postal Service annuitants must enroll in a PSHB plan during the PSHB Program Open Season in late 2024. Postal Service employees and Postal Service annuitants currently enrolled in FEHB plans who do not enroll in a new PSHB plan during Open Season in 2024 will automatically be enrolled in a PSHB plan.

Other Insurance & Benefit Programs

Fortunately, enrollment in a PSHB plan will not impact or disrupt enrollment in other insurance and benefits programs, including:

• Federal Employees Dental and Vision Insurance Program (FEDVIP)
• Federal Flexible Spending Account Program (FSAFEDS)
• Federal Employees’ Group Life Insurance (FEGLI), or
• Federal Long Term Care Insurance Program (FLTCIP)

The New Medicare Part B Participation Requirement

There are two sets of rules to follow concerning Medicare enrollment, one for those still employed and another for annuitants. The rules are also based on age at the time of retirement.

The requirement to sign up for Medicare Part B is limited to postal employees that retire on or after January 1, 2025, and you are under 64, you WILL BE required to enroll in Medicare Part B when you become entitled to Medicare Part A (typically at age 65) to remain enrolled in a PSHB plan.

There are two fact sheets published by OPM for active employees and annuitants, the following information is excerpted from these documents.

USPS Active Employee Requirements

If you are an active employee age 64 or older as of January 1, 2025, you ARE NOT required to enroll in Medicare Part B to continue your PSHB health insurance coverage once you retire. However, upon your retirement and entitlement to Medicare Part A (typically at age 65), you will have the option to enroll in Medicare Part B during a special enrollment period.

• If you are the primary subscriber, your covered family members will not be required to enroll in Medicare Part B to stay on your PSHB plan; however, enrollment in Medicare Part B may reduce your overall costs for health care-related expenses and may provide better value for you and your family.

If you are an active employee under the age of 64 as of January 1, 2025, to continue your PSHB health insurance coverage in retirement, you WILL BE required to enroll in Medicare Part B after you retire and become entitled to Medicare Part A (typically at age 65).

• If you are the primary PSHB enrollee, your covered family members will also be required to enroll in Medicare Part B when you retire, upon their entitlement to Medicare Part A, if they wish to remain covered by your PSHB insurance.
• If you retire on or after January 1, 2025, and you are under 64, you WILL BE required to enroll in Medicare Part B when you become entitled to Medicare Part A (typically at age 65) to remain enrolled in a PSHB plan. The Social Security Administration (SSA) will mail you a notice when you are eligible to enroll in Medicare Part B during your initial enrollment period. Your initial enrollment period starts three months prior to your 65th birthday and ends three months after your 65th birthday. If you are the primary PSHB subscriber, your covered family members will also be required to enroll in Medicare Part B upon their entitlement to Medicare Part A, if they wish to remain covered by your PSHB insurance.

There are exceptions to the requirement to enroll in Medicare Part B as an annuitant. These exceptions will also apply to your covered family members. Annuitants may be responsible for providing proof of eligibility for the applicable exception(s) to the designated agency. These exceptions are:

• You are residing outside of the United States and its territories. You are required to follow the policy and procedure set forth by the Postal Service to be eligible for this exception; or
• You are enrolled in health care benefits provided by the Department of Veterans Affairs; or
• You are eligible for health services provided by Indian Health Services.

USPS Annuitant’s Requirements

If you are an annuitant as of January 1, 2025, and not currently participating in Medicare Part B, you ARE NOT required to enroll in Medicare Part B to continue your health insurance coverage in the new PSHB Program. Participation in Medicare Part B is voluntary; however, enrollment in Medicare Part B may reduce your overall costs for health care-related expenses and may provide greater value.

• Your covered spouse and eligible family members will also not be required to enroll in Medicare Part B even if they are age 65 or older; however, enrollment in Medicare Part B may reduce overall costs for health care-related expenses and may provide greater value.
• Note: If you are an annuitant as of January 1, 2025, and are already enrolled in Medicare Part B, you ARE required to remain enrolled in Medicare Part B to continue coverage under PSHB.

If you are an annuitant entitled to Medicare Part A (typically at age 65) prior to January 1, 2024, and have not enrolled in Medicare Part B, you and your covered, eligible family members may be able to participate in the special enrollment period (SEP) for Medicare Part B that starts on April 1, 2024. Those who enroll during the SEP will not need to pay the late enrollment penalty. Eligibility letters will be sent to annuitants and eligible family members in early 2024.

If you retire between October 31, 2024, and December 31, 2024, and are entitled to Medicare Part A (typically at age 65), you will have the option to enroll in Medicare Part B during a specific eight-month special enrollment period immediately following your retirement date. If you wish to enroll, you MUST contact the Social Security Administration (SSA) to initiate enrollment if you are over the age of 65.

As a general rule, spousal and family member PSHB coverage is based on the primary subscriber’s eligibility. If the primary subscriber is not required to join Medicare Part B, neither will dependent family members.

Additional Information

• PSHB Overview
• USPS Employee’s Fact Sheet
• Information for Employees
• USPS Annuitant’s Fact Sheet
• Information for Annuitants

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• Master Retiree Contact List
• TSP Guide

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: FEHB, Health Care, Medicare Part B, New Health Care System for Postal Employees, PSHB
Posted in BENEFITS / INSURANCE, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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Posted on Friday, 1st September 2023 by Dennis Damp

How did I ever find time to work before retiring? A lament expressed by many retirees, including myself. Life was much simpler, slower paced, with fewer technological advancements when I was young and full of vim and vigor. That ship has long since sailed.

Frustration Times 10

A friend forwarded me Steeler Tickets via email last week for the Jacksonville game this October.  I’ll be taking my grandsons to their first Steeler game. I had an iPhone-7 and it’s IOS (Operating System) wouldn’t transfer the tickets to the phone’s wallet.

If you don’t transfer the tickets to the wallet, you may not be able to access Ticket Master or the Steeler’s website the day of the game. Everyone and their uncle will be trying to get into the stadium with their cell phones; web-based systems are prone to crashing when you need them the most.  The wallet stores the scannable tickets on your phone, so you don’t have to connect to the internet to enter the stadium. Just open your wallet app.

I decided to upgrade my 5-year-old phone to an iPhone 13. They offered a special if I transferred my business lines to them as well and I agreed. A free second phone to replace my office’s landline was included and my monthly costs would only increase $20. Sounded reasonable.

I spent almost 7 hours over a two-day period to get this done. Two hours that first morning, a 2 o’clock appointment the same day that lasted until 5 pm, and then another two hours three days later to set up my new mobile business account. I’ve bought cars and homes in less time than it took to effect these changes.

You would think the process would be intuitive and fairly quick, it isn’t.  There were a few bright spots, with previous upgrades I lost contact information, photos, and many of my apps didn’t transfer correctly.

This time around the transfer to both phones was flawless, no lost data and I only had to reload one app of the 110 on my phone! It took over an hour for each phone transfer. A pleasant surprise even though the wait was unacceptable, and they had the most uncomfortable chairs without back supports in their waiting room.

The Truth and Nothing but the Truth

When we look under the hood so to speak, the substance of a process or program is exposed. Often times what we uncover reveals the truth of the subject without the frills that are meant to distract and persuade us to support an untenable proposition.

Inflation is insidious and steals more from us each and every day. The Inflation Reduction Act passed by Congress last year had little to do with reducing inflation. Its main purpose was to reduce carbon emissions, invest in clean energy, tackle the climate crisis, and to achieve the Biden Administration’s climate goals, including a net-zero economy by 2050!

Yes, there are elements to the bill that have merit. It wasn’t meant to fight inflation, yet the title persuaded many to support it.

Prices Continue to Soar

I worked on a number of projects this year and the costs for materials have gone through the roof. A gallon of paint, midgrade, was $45 on sale, a small container of spackling compound cost $6.95, the price I paid for a quart container before the COVID crisis hit.

The cost of electricity, natural gas, homeowner insurance, car insurance, gasoline and so much more continue to move higher with few exceptions. One of our homeowner’s insurance policies increased 340% this year from $750 to $2,985!

Eggs are one of the few success stories, they are down to just over a dollar a dozen. While shopping this week a 10 oz can of coffee was $6.95, a year ago a 25.6 oz container of Maxwell House coffee was on sale for $6.95.

Men’s haircuts are averaging $25 in my area, I took my son and a friend to breakfast recently, nothing out of the ordinary, and the bill was over $40.

Mortgages are approaching 8%; many desiring to move or upgrade are hesitant to give up their 3% mortgages for the higher rates available today. Unfortunately, a good number of first-time buyers are priced out of the market.

In 1985 when I had Permanent Change of Station (PCS) orders to move to a new duty station, the lowest mortgage rate was 11 percent. When we closed, the couple selling us the property laughed when the agent said the total payout for a $65,000 loan over 30 years was $250,000! I refinanced several times after the closing as rates declined. Are we heading down this same path today? Time will tell.

The list goes on and on so when you hear inflation is improving, I’m sure if you look under the hood, you will find what my wife and I run into each and every day. It isn’t getting better.

Climate Crisis – Real, Imagined or Both

Our climate is a function of the earth’s size, magnetic poles, the polar icecaps, orientation to the sun, ocean currents, the earth’s axis and temperature differences that set everything into motion and so much more. The world’s climate has constantly changed since the beginning of time.

Anytime we suffer from a climate event: storms, draughts, floods, hurricanes, tornadoes, and other anomalies, it is a crisis for those impacted. The question is, can man affect climate change that is a natural order of the planet and how all of its elements interact.

I’ve gone through a number of climate anomalies including hurricane Camille that hit Biloxi Mississippi where I was stationed in 1969. The storm devastated the area and I was placed on many cleanup details, entire communities were gone or washed away.

The storm hit on August 17, 1969, three months before I married the love of my life. I was looking forward to bringing my fiancée down to the gulf coast after our marriage and wrote Mary about the amusement park on the beach, restaurants on long piers that jetted out into the water, and the beautiful coastline drive. All vanished during the storm.

Mini Ice Age

Did you know that a little ice-age impacted the world from the mid 1300 hundreds to 1850. There were few carbon-based fuels used other than wood, coal and peat to blame the crisis on. Nature calls the shots, and we have to react to it as best we can.

According to Britannica, “The Little Ice Age, though synonymous with cold temperatures, can also be characterized broadly as a period when there was an increase in temperature and precipitation variability across many parts of the globe.”

Yes, climate changes and we should be good stewards of our earth, explore ways to mitigate potential climate related events, recycle, use renewable energy where it makes sense because carbon-based fuel supplies aren’t infinite. However, we must be cautious not to tip the scales too far in any direction without considerable forethought.

Every weather event today is sited as a reason to aggressively move towards a net zero economy and to fast track the move towards all electric vehicles. The following articles and book discuss climate change and the first two explain some of the perceived misconceptions and how politicians use it to drive their agenda.

The third one is the Environmental Protection Agencies’ (EPA’s) climate analysis. Two somewhat different perspectives, all voices should be heard to come to consensus on the path forward.

It would be virtually impossible to develop a model to accommodate all aspects that impact earth’s climate. The more input received and considered, the better understanding we will have of this complex subject.

• Running Hot and Cold: Climate Doomsdays across Three Centuries
• Hot Talk, Cold Science (2021) by Fred Singer
• Climate Change Causes – EPA

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: Climate Change, Inflation, iPhone Upgrade
Posted in FINANCE / TIP, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Posted on Friday, 18th August 2023 by Dennis Damp

The Office of Personnel Management (OPM) released three videos recently to help federal retirees navigate their online retirement services accounts. Those planning their retirement should be aware of the process; when you leave sign up to access your annuity and benefits information online.

This initiative is designed to assist federal employees transition from active service to retirement and encourage retirees to take advantage of this feature. The intent of these videos is to reduce login errors for federal retirees managing their retirement accounts online according to Kiran Ahuja, the OPM Director.

The process can be confusing and my article titled “ALERT – OPM Services Online Access Changes” walks you through the sign on process and these changes. OPM’s videos provide additional help when signing up for an account.

OPM Videos

• How to register for a Login.gov account through Services Online
• How to access and link your Services Online account with your existing Login.gov credentials
• How to access and link your Services Online account with your existing Login.gov credentials

Services Online Benefits

Services Online lets annuitants (federal retirees or their spouses, ex-spouses, and children) manage their account online. You can view and print out your annuity statements, initiate or change allotments, download 1099R tax forms, set federal and state tax withholdings, and much more.

This service also has the capability to reduce OPM’s call center traffic. If you ever called for assistance, you know what I’m talking about. It’s difficult getting through and when you do the wait times are excessive. Much of the time a visit to OPM’s Services Online will resolve your concerns.

Services Offered

There is a laundry list of services, downloadable annuity verification letters, and others that you can take advantage of. Here is a master list of what the site provides with a short description for each entry:

• Annuity Statements (Select the desired payment date and that month’s payment appears, you can print out a copy for your records.)
• Annual Summary of Payments (The Summary of Payments and total paid to date. Payment descriptions, that month’s amount, total amount to date, click “Year to Date Totals” for a complete list by month for each item.) A very useful report.
• Direct Deposit (Direct Deposit allows your annuity payment to be sent to the financial institution of your choice) Just click on “Change” to make changes or to switch to another financial institution.
• Life Insurance (This is your current proof of life insurance on file.)
• 1099-R Tax Form (A form 1099-R for the current tax year and for four previous years can be printed or downloaded to your device.)
• Federal Tax Withholdings (Federal income tax to withhold from your payment.) You can change this at any time.
• State Tax Withholdings (You may change the withholding amount for your State Income Tax and/or select a new State for the withholding.) Some states do not tax annuities.
• Checking and Savings Account Allotments (You may start a new allotment, change an existing allotment amount, or stop an existing allotment.)
• Organizations Allotments (You may start a new allotment, change an existing allotment amount, or stop an existing allotment to an organization, where you have a membership.)
• Transaction History (A history of your recorded transactions.)
• Retirement Card (Print out a Retirement Card to carry if desired.)
• Documents (How to Guides, Booklet Request, 1099R Request, Annual Notice of Annuity, Annual Summary of Payments, and Disability Earnings Survey)

Summary

I highly recommend all retirees sign up for this service, it saves time and frustration when dealing with OPM. After you get acquainted with the sign in process, as described in my article and view the new videos, it’s easy to access and provides abundant services.

Each year I request a new Blue Book using the request form under the Documents tab on the site and it provides updated information for your annuity and benefits.  I received my first book March 12, 2005 several months after I retired and I keep it to compare it to the new one I order each January. It is very revealing and is a must for your heirs, add it to your estate planning binder.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: Federal Retiremnet, OPM Services Online, Retirment Services
Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Posted on Friday, 11th August 2023 by Dennis Damp

Please forward this to others needing retirement planning assistance.

Those planning their retirement and annuitants require accessible resources to find answers to their retirement questions. The new year is fast approaching and many feds are now determining their best date to retire.

Retirement planning is of and in itself a complicated process with many avenues to explore. Fortunately, help is available; what service you require depends on the complexity of the issues and the level of assistance you personally need.

LEVELS Of ASSISTANCE

• General Assistance (Try these resources first)
• Comprehensive Guidance
• One-on-One Counseling / Assistance

GENERAL ASSISTANCE

OPM

The Office of Personnel Management (OPM) is the HR department for the federal government; they administer the retirement benefits program. Active federal employees can research various aspects of retirement on OPM’s site. However, they must contact their agency’s HR office for retirement forms, processing, and guidance.

Recently OPM issued a Retirement Quick Guide, A Reference for Voluntary Retirement that you will find helpful. Download a copy and keep it with your retirement paperwork.

OPM services the retirement community; If you are an annuitant (retiree), call or use their online services portal to obtain current benefit information, related documents, and payment statements online if registered for their service.

It is difficult getting through to them by phone and when you do, expect long waits. OPM is the only entity that can effect desired changes or update your records.

• Phone Number: 1-888-767-6738, TTY: 855-887-4957 weekdays only.
• Email: retire@opm.gov
• Website: https://www.opm.gov/retirement-services/
• Annuitant’s Online Services: https://www.servicesonline.opm.gov/

NOTE: OPM’s Services Online changed how you access your account last year.

Federal Employee’s Retirement Planning Guide

I launched this site in 2004 when I was planning my retirement. It is designed to help federal employees and retirees find the information they need to make informed benefit and retirement decisions.

A site visitor commented after finding the retirement answers he needed, “I spent 3 hours on the web looking for answers to questions concerning federal retirement. After a Google search yielded your address, it took only 20 minutes to find all of my answers! Thank you!!!”

How to Find Essential Retirement and Benefits Information on This Site

Abundant retirement planning guidance is compiled from a multitude of federal agencies: OPM, Social Security, Medicare, TSP, the Department of Labor and others. Use the main menus and search box at the top of each page to find benefit clarifications, financial planning guidance, FERS / CSRS eligibility determination and annuity estimates, general explanations, examples, and suggestions that you won’t find elsewhere. The related blog and weekly email newsletter offer guidance on current topics of interest.

• Website: https://www.federalretirement.net/
  • The Ultimate Retirement Planning Guide
• Retirement Planning Blog https://www.fedretire.net
• Subscribe to our FREE Retirement Planning E-Mail Newsletter

COMPREHENSIVE GUIDANCE

Retirement Planning Seminars

Contact your HR department to sign up for a retirement planning seminar. They cover CSRS and FERS employees, (including Special provisions) and may be offered in Full or Half-day sessions. The information is generally divided into seven key areas:  CSRS or FERS retirement annuity, Thrift Savings Plan (TSP), Voluntary Contribution Plan (VCP) – CSRS and CSRS Offsets only, Federal Employees Group Life Insurance (FEGLI), Social Security, Federal Employees Health Benefits (FEHB), Federal Employees Dental and Vision Insurance Program (FEDVIP) and disability programs.

Federal Employee’s Retirement Planning Software (https://fedretiresoftware.com/)

This easy-to-use and reasonably priced software is uniquely designed for federal employees (full-time, regular CSRS & FERS) to calculate your federal benefits up to and throughout retirement. You can also add income and/or expenses from other sources.

This calculator is used by tens of thousands of federal employees as well as Federal HR departments to make informed retirement planning decisions. Checkout their Sample Report to get a better understanding of how comprehensive their calculator is for federal employees planning their exit.

ONE-ON-ONE COUNSELING / ASSISTANCE (Finding someone to talk to)

Often, individuals need to talk with an expert to address complex issues and make informed decisions about what is best for their situation. Here is a list of those you can contact to help you address your concerns when the research you’ve done hasn’t provided an answer.

Call Your Agency’s HR Department (Federal Employees)

Federal employees with retirement questions should contact their HR department, OPM only services annuitants and survivors. Your HR department will provide annuity estimates for multiple target retirement dates, explain your benefit options, and arrange for you to attend a retirement seminar.

Columnists

Many columnists, like myself, reply to email questions. Generally, I’ll send a reply with links to relevant sections of my website, related blog articles, and to OPM guidance that will help. When I’m asked to provide one-on-one counselling, I refer them to the professional counselors listed below.

Retirement Planning Consultant – All Areas

A professional federal benefits consultant can address your concerns and answer any questions that you may have. If they don’t have the immediate answer, they have the contacts and resources to obtain them.

Retire Federal, a consulting firm owned by Tammy Flanagan, a federal benefits expert who has been assisting feds since her days of employment with the Federal Bureau of Investigation. She and her staff of experienced counselors offer invaluable fee-for-service personal consulting for civilian federal employees and annuitants on pre-retirement retirement prep to post-retirement decisions and events.

Their staff will assist you with a thorough review of your pre-retirement tasks and help you decide about Medicare Part B and which FEHB plan will coordinate best for your situation. They can address your concerns, answer questions, recommend options, provide details as to why one path is preferred over another, and put your mind at ease.

Ms. Flanagan is also the Senior Benefits Director for the National Institute of Transition Planning, Inc. which has conducted pre-retirement seminars and workshops since 1987.

Since 2006, Tammy has authored the popular weekly “Retirement Planning” column for Government Executive online magazine with more than 250,000 subscribers. She was selected as one of Money Magazine’s “Money Heroes” of 2012 for the service that she provides to help federal employees prepare for life after retirement.

Retirement Planning and Divorce Related Issues for Federal Employees – Consultant

Ann Ozuna is a retired Personnel Management Specialist. She founded Personnel Solutions Federal Benefits Counseling upon retirement from federal service in 1996.

Her federal benefits consulting firm specializes in educating federal employees on retirement benefits and assisting employees with CSRS/FERS regular and disability retirements. They also work with employees/retirees and their lawyers on divorce matters. Federal retirement is not under the same law as private sector retirements.

In addition to her 25-year federal personnel career, she holds an MBA from Gonzaga University and the Senior Professional in Human Resources (SPHR) and Chartered Federal Employee Benefits Consultant (ChFEBC) designations.

• Divorce Considerations
• Don’t Get Burned by Your Old Divorce Decree
• Contact: (509) 993-2283, Email: RetireLady@asisna.com

If you need answers to retirement questions or don’t know what options are best for you and your family, use the resources listed above or other reputable services.

Helpful Retirement Planning Tools

• Retirement Planning for Federal Employees & Annuitants
• The Ultimate Retirement Planning Guide – Start Now
• Deciding When To Retire – A 7-Step Guide
• Annuity Expectations – Before and After
• TSP Guide
• Budget Work Sheet
• Medicare Guide
• Social Security Guide

The advice and strategies contained herein may not be suitable for your situation and this service is not affiliated with OPM or any federal entity. You should consult with a financial, medical or human resource professional where appropriate. Neither the publisher or author shall be liable for any loss or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Tags: Federal Employee Counseling Services, Federal Retirement, Retirement Planning Assistance
Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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