Yes, federal employees can keep their health insurance after retirement, and the government continues to pay the majority of the premium. Retired federal workers stay in the same Federal Employees Health Benefits (FEHB) Program they used while working, choosing from the same plans at the same cost as active employees. But there are eligibility requirements you need to meet before you retire, and the rules around Medicare, plan changes, and survivor coverage are worth understanding well in advance.
Eligibility Requirements
To carry FEHB coverage into retirement, you must meet two conditions. First, you need to retire on an immediate annuity, meaning your pension payments begin within 30 days of leaving federal service. This includes standard retirement under FERS or CSRS, as well as early retirement options like the FERS Minimum Retirement Age plus 10 years of service. If you leave federal service and defer your annuity to a later date, you lose the ability to keep FEHB.
Second, you must have been continuously enrolled in an FEHB plan (or covered as a family member under someone else’s FEHB plan) for the five years of service immediately before your annuity starts. If you’ve had fewer than five years of service total, you need to have been enrolled since your first opportunity. There are no exceptions for gaps. If you dropped your coverage for a period and re-enrolled, that break could disqualify you. Military members covered by TRICARE get credit toward this five-year requirement, but they still must be enrolled in an FEHB plan on the actual date of retirement.
What You Pay as a Retiree
The cost structure stays the same after retirement. The government pays up to 72% of the weighted average premium, and you pay the rest. For 2026, the maximum monthly government contribution is about $704 for self-only coverage, $1,541 for self-plus-one, and $1,686 for self-and-family. Your share depends on which plan you pick. Less expensive plans may cost you very little out of pocket, while premium options will leave you covering a larger portion.
Premiums are deducted directly from your annuity payment rather than a paycheck, so the process is seamless. Keep in mind that premiums have been rising. For the 2026 plan year, the average enrollee share increased by 12.3%, following a 13.5% jump the year before. These increases affect retirees and active employees equally.
How FEHB Works With Medicare
When you turn 65, you become eligible for Medicare, but enrolling is not required to keep your FEHB coverage. Your FEHB plan will continue paying benefits in full if you don’t sign up for Medicare. Your FEHB premiums also won’t go down if you do enroll in Medicare, so the financial calculation isn’t straightforward.
That said, OPM advises retirees to enroll in Medicare Part A if it’s premium-free for them, which it is for most people who paid Medicare taxes for at least 10 years. Part A covers hospital stays and costs you nothing, so there’s little reason to skip it. Medicare Part B, which covers doctor visits and outpatient care, does carry a monthly premium. Whether it’s worth the added cost depends on your health needs and your FEHB plan’s coverage.
If you enroll in both, Medicare becomes the primary payer and FEHB acts as secondary coverage, picking up costs that Medicare doesn’t cover. This combination can significantly reduce your out-of-pocket expenses, especially for hospital stays, specialist visits, and procedures. But you’re paying two premiums to get that level of coverage.
Changing Plans in Retirement
Retirees participate in the annual Federal Benefits Open Season just like active employees. During this window (typically mid-November through early December), you can switch to a different FEHB plan, change your enrollment type, or cancel coverage entirely. You can also enroll in or change federal dental and vision insurance during this period.
Outside of Open Season, changes are only allowed after a qualifying life event such as marriage, divorce, the birth of a child, or loss of other coverage. If your current plan leaves the FEHB program or reduces its service area, you’ll be notified and given the chance to select a new plan. For 2026, six FEHB plans are being discontinued, and anyone still enrolled will be automatically moved to a default plan if they don’t choose a replacement during Open Season.
The FEHB program offers 132 plan options for 2026 across 47 carriers. Retirees who relocate should pay attention to whether their plan operates as a regional HMO or a nationwide option. Nationwide fee-for-service and PPO plans work anywhere in the country, while HMOs are limited to specific geographic areas.
Suspending FEHB for TRICARE or CHAMPVA
If you’re eligible for TRICARE or CHAMPVA (health coverage for certain veterans’ family members), you can suspend your FEHB enrollment and stop paying premiums while using that other coverage. This is a useful option for military retirees who want to take advantage of TRICARE’s lower costs.
The key benefit of suspension over cancellation is that you can re-enroll in FEHB during any future Open Season, for any reason. If you’re involuntarily dropped from TRICARE or CHAMPVA, you can re-enroll in FEHB immediately, as long as your request is received within the window starting 31 days before and ending 60 days after your other coverage ends.
Postal Service Employees: Different Rules Since 2025
As of January 1, 2025, current and retired U.S. Postal Service employees are no longer eligible for FEHB. They’ve been moved to the Postal Service Health Benefits (PSHB) program, which operates similarly but is administered separately. Postal retirees who didn’t enroll in a PSHB plan during the transition period lost their employer-sponsored health coverage.
There’s one exception: if a postal employee or retiree is covered as a family member under a non-postal federal employee’s FEHB plan, that coverage can continue. The PSHB program had 75 plan options across 17 carriers for 2026, with its own premium structure and rate increases.
Coverage for Surviving Spouses
If a federal retiree dies, their surviving spouse can continue FEHB coverage at the same cost as active employees, provided the spouse is receiving a survivor annuity. This is one of the more valuable aspects of federal retirement benefits. The surviving spouse keeps access to the full range of FEHB plans and participates in Open Season like any other enrollee. For this reason, the decision about whether to elect a survivor annuity at retirement (which reduces your monthly pension) has implications beyond just the pension payment itself.
What Retirees Get in 2026 Plans
FEHB plans for 2026 include several notable coverage areas. All plans must cover at least one GLP-1 weight loss medication along with two oral anti-obesity options and behavioral health programs. Behavioral health access is expanding, with carriers required to broaden their networks and allow out-of-network mental health care when wait times are too long. Plans also must cover HIV prevention drugs with no cost sharing, and provide at least one opioid overdose rescue medication at no cost.
For retirees considering fertility preservation before medical procedures, plans now cover egg and sperm retrieval, freezing, and at least one year of storage for people facing infertility from necessary medical treatments. HMO plans in states with IVF mandates are also required to meet those state requirements.