Medicare and FEHB Blue Cross Explained

Medicare and FEHB Blue Cross can be overwhelming, but understanding the basics can make a big difference.

Medicare is a federal health insurance program for people 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (ESRD).

You're eligible for Medicare if you're 65 or older, or if you're under 65 with a disability or ESRD.

FEHB plans, including those offered by Blue Cross Blue Shield, cover emergency care outside of the U.S., which Medicare does not.

Some FEHB plans, such as Blue Cross Blue Shield FEP, offer Medicare Advantage plans, but it's essential to check with your provider to confirm availability.

If you're a CSRS retired annuitant with a current FEHB plan, you can suspend your FEHB coverage and avoid paying the FEHB premium while you have Medicaid, but check your state's Medicaid eligibility rules first.

Medicare pays first for Medicare-covered services for annuitants, then FEHB, and Medicaid pays last.

Here's a simplified order of coverage:

If you're considering Medicare and FEHB Blue Cross, it's essential to understand the costs involved.

The good news is that all FEHB plans provide prescription drug coverage, so Original Medicare beneficiaries who choose to combine health care with FEHB don't need to enroll in Medicare Part D.

However, if you lose or unenroll in FEHB coverage, you'll have to pay a higher premium for Medicare Part D if you go without equivalent prescription drug coverage for 63 days or longer.

There might be other premiums and out-of-pocket costs associated with Medicare and FEHB coverage that vary based on the plan chosen. It's crucial to speak with your insurance provider to fully understand your benefits and what's covered by your provider.

The government pays 72% of the premiums for most people who have FEHB coverage. This includes employees, self plus one, and self and family plans.

For those who don't receive a contribution toward the premium from the government, temporary employees, past spouses enrolled under spouse equity provisions, and people or dependents covered under temporary continuation of coverage are examples.

Here's a breakdown of the maximum government contributions for most employees in 2025:

Medicare and FEHB Blue Cross can be a bit confusing, but understanding the primary payer and other coverage can help you navigate the system.

Medicare is the primary payer in certain situations, such as when you're an annuitant or have End Stage Renal Disease (ESRD). If you have Medicare due to ESRD, it will remain the primary payer for 30 months, even if you're still working.

If you're an active federal employee, FEHB is the primary payer, and any medical claims will first go to FEHB plans for payment consideration. This is the case even if you're under 65 or eligible for Medicare based on a disability.

There are specific situations where Medicare will become the primary payer, such as when you retire or are no longer employed by the government and receiving workers' compensation. If you're retired and covered by a spouse's policy, that policy will be the primary payer, with Medicare as the second payer and FEHB paying last.

Here are some scenarios where Medicare or FEHB is the primary payer:

Having both FEHB and Medicare can provide additional benefits, and the OPM recommends enrolling in Medicare Part A if you're eligible for premium-free coverage. However, if you have Medicare Advantage, you may not need FEHB as well, as the plans may provide similar benefits.

Medicare Advantage Plans, also known as Part C, are provided through private insurance companies and offer enhanced versions of Original Medicare.

Medicare and FEHB can be coordinated, but it's essential to know when each plan is the primary or secondary payer to understand how the coordination functions.

Medicare Advantage plans, like those offered by Blue Cross, provide both Medicare Part A and Part B, along with other benefits, sometimes including prescription drugs.

You may need to pay any remaining billed amount if the secondary payer doesn't cover the full cost.

Here's a quick rundown of how Medicare and FEHB work together:

Having both FEHB and Medicare can provide additional benefits, especially for federal employees or retirees eligible for premium-free Medicare Part A.

Medicare Advantage Plans, also known as MA plans, are provided through private insurance companies.

These plans are essentially enhanced versions of Original Medicare, offering both Medicare Part A and Part B, as well as other benefits, sometimes including prescription drugs.

Medicare Advantage plans are provided by private insurance companies, which means they have their own networks of healthcare providers and hospitals.

These plans can offer additional benefits, such as dental, vision, and hearing coverage, that are not included in Original Medicare.

By choosing a Medicare Advantage plan, you can have all your healthcare needs met in one plan, rather than having to purchase separate plans for different services.

The FEHB program and Medicare plans can work together in a coordinated way.

Medicare and FEHB determine which one is the primary payer in a given scenario, with Medicare rules making this decision.

If Medicare is primary, it automatically transfers claims information to your FEHB plan, and you generally don't need to file a claim with both plans.

You'll receive an Explanation of Benefits (EOB) from your FEHB plan and a Medicare Summary Notice (MSN) from Medicare.

Here's a simple breakdown of how it works:

If you're an Original Medicare beneficiary who chooses to combine health care with FEHB, you won't need to enroll in Medicare Part D because FEHB plans provide prescription drug coverage.

All FEHB plans offer prescription drug benefits, so you'll have coverage for your prescription medication costs.

However, if you do choose to combine FEHB and Medicare Part D, Medicare will act as the primary payer, and FEHB will review and cover claims of prescription drug costs that weren't covered by Medicare.

This means that you'll need to pay out-of-pocket for any prescription medication costs that aren't covered by Medicare or FEHB.

Blue Cross Blue Shield FEP doesn't offer a Medicare Advantage plan.

As a CSRS retired annuitant, you're eligible for Medicare, but you can keep your current FEHB plan through Blue Cross Blue Shield FEP.

You can enroll in Medicare Part A and B, and keep your FEHB plan for additional coverage.

Your spouse won't be eligible for Medicare until they turn 65 in 2025, so you'll need to explore other options for coverage between your birthdays.