Questions & Answers
Q&A
THE FOLLOWING QUESTIONS & ANSWERS were compiled by NARFE’s Federal Benefits Institute experts. NARFE does not provide legal, financial planning or tax advice or assistance.
EMPLOYMENT THRIFT SAVINGS PLAN (TSP)
Q
I heard there are changes coming to the TSP. Where can I find more information?
A
Yes, the TSP moved to a new recordkeeping system in early June. All TSP participants need to set up a new login for the new My Account. Features of the system include: • 24/7 virtual assistant (AVA). • Personalized support to move money from IRAs, SIMPLE IRAs and other eligible employer plans. • TSP mobile app. • Mutual fund window (additional fees). • Civilian and a uniformed service accounts viewable in one place. • Electronic signatures available. To learn more about these recent changes to the TSP, visit www.tsp.gov/new-tsp-features/ summary-of-changes/.
MEDICARE ENROLLMENT
Q
I am turning age 65 and still working. I plan to work for a few more years and am in good health. Do I have to sign up for Medicare?
A
If you are covered by current employment health insurance, such as the Federal Employees Health Benefit (FEHB) program, you do
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not have to enroll in Medicare at age 65. You will have a Special Enrollment Period (SEP) to enroll in Medicare Part B without a late enrollment penalty following your retirement. Unless you wish to continue to contribute to a Health Savings Account (if you are enrolled in a high-deductible health plan), you may wish to enroll in Medicare Part A hospital insurance, which has no premium since you’ve paid the 1.45 percent payroll tax during your career. This can be done by contacting Social Security during your Initial Enrollment Period that begins three months prior to your turning age 65 and ends three months following it. This could provide some additional benefits if you are admitted for inpatient hospitalization. Medicare Part B medical insurance does have a monthly premium; the standard premium for Medicare Part B in 2022 is $170.10/month/person. Typically, there is a “penalty” of 10 percent of the standard premium for each 12-month period that you delay enrollment. However, employees who are still working after their 65th birthday can use the SEP to enroll within 8 months after they retire and not have to pay the penalty.
Special Enrollment Period Fact Sheet: www.ssa.gov/pubs/ EN-05-10012.pdf. Medicare Benefits: www.ssa. gov/benefits/medicare/. Note: TRICARE, the health care program for active-duty or retired uniform service members, National Guard or Reserve members, and their eligible family members, requires enrollment in Medicare Parts A and B to be covered under TRICARE For Life. For more information visit www. tricare.mil/. TRICARE For Life offers secondary coverage to TRICARE beneficiaries who have both Medicare Parts A and B. Federal employees may use FEHB coverage while employed and then add Medicare Parts A and B after retirement. Once retired, you may suspend FEHB coverage to use TRICARE For Life and Medicare. This avoids having to pay the Medicare Part B premium during your employment, since the late enrollment penalty is waived. Retirees may suspend FEHB using form RI 79-9: www.opm. gov/forms/pdf_fill/ri79-9.pdf.
UNUSED SICK LEAVE CONVERSION
Q
I know unused sick leave can count toward the retirement benefit calculation. Can you explain
