Answers to Your Medicare and FEHB Questions

Part D is prescription insurance. If you have FEHB health coverage, you already have coverage for your medicine. If you are still spending a lot out of pocket for drugs, you may consider enrolling in a Medicare Part D plan, for a fee, that will cover more of your prescription expenses.

You're covered by FEHB, you're retired and you are 65 or older -- what are the choices?

1. Keep FEHB and enroll in Part A only. Cost: FEHB premiums plus zero dollars for Part A. This is a good idea! Your FEHB may limit the payments for your care to those payments you would be entitled to if you had Part B, so you may find that your out-of-pocket expenses are higher than before you were 65. Check your FEHB brochure and talk to your doctors about this choice.

2. Keep FEHB and enroll in Medicare Parts A and B. Cost: FEHB premiums plus $96.40 per month for Part B, but it's more if you're well off. In some cases your FEHB plan will waive your deductibles, co-payments and coinsurance. This can reduce your out-of-pocket expenses to near zero. If you have a lot of trips to the doctor, this can save more than the Part B premium. If you choose to enroll in Part B after age 65, you may have to pay a significant late enrollment surcharge (10 percent for every year enrollment is delayed), so it may pay to sign up when you're eligible whether you need it or not. You might consider switching to a less expensive FEHB plan that will help free up some of the money you need to pay for Part B.

3. Suspend FEHB and enroll in Medicare A, B, C and possibly D. This may be less expensive than your FEHB premiums, but your coverage may require you to see different doctors or providers in a different network and your out-of-pocket expenses may be higher.

What about if you are still employed or are covered by FEHB through your spouse's current employment?

You can postpone enrollment in Medicare Part B until you retire (sign up for Part A when you are about three months from your 65th birthday). There is no penalty for late enrollment as long as you enroll within eight months of the retirement date.

The Web site for the National Institute of Transition Planning is http://www.nitpinc.com.

Federal Pay Increase

President Bush signed an executive order yesterday that provides pay raises for white-collar federal employees. Workers in the Washington-Baltimore area will get a 4.78 percent increase next year.

Under the new pay scale, which takes effect with the pay period that begins Jan. 4, pay for General Schedule workers ranges from $21,592 at grade 1, step 1 to $153,200 for grade 15, step 10.

The executive order authorizes a national across-the-board pay hike of 2.9 percent, plus locality increases that differ from place to place.

Detailed information about the pay increase is available at http://www.chcoc.gov/Transmittals/TransmittalDetails.aspx?TransmittalId=1786.

The Federal Diary will be closed until next year. Have a happy holiday!

Contact Joe Davidson at federaldiary@washpost.com