Guide to FEHB Temporary Continuation of Coverage (TCC)

Uncle Sam’s version of COBRA Health Care extension coverage is called Temporary Continuation of Coverage (TCC).

It’s run pretty much the same as a private sector COBRA plan (what you are offered if you resign or are terminated from a private sector employer).   Under COBRA, you can opt to continue with your (previouos) employer’s health care coverage for up to 180 days following separation, but you pay the full boat premium (your insurance premium, PLUS the employer’s share of the premium), PLUS an additional 2% administrative fee.

As a separated Federal Employee, here are Six Things You Must Know about TCC:

Q: How Long?  A: You have 31 days of Temporary Continuation Coverage (TCC) at no cost, following the last day of the pay period in which you separate.

If you would like to opt for (paid) TCC, you must do so within 60 days of your separation date (NOT the last day of the pay period in which you separated).

Q: Am I stuck with the same FEHB Plan?  A: You can switch health plans.  If youy elect TCC, you can switch health plans (!) since you’ve just experienced a ‘Life Changing Event’.

  • OK, why would you do this?  An example I can think of is if your new employer’s plan/Obamacare is near the end of its ‘Plan Year’ and has such a high deductible that it would be cheaper to pay the full boat TCC premium (FEHB plus 2%) for a TCC Blue Cross plan or TCC HMO plan for a few months until your employer’s new ‘Plan Year’ starts.

Q: Can I keep my HSA?  A: Yes, but Watch out for HSA Land Mines!  If you were enrolled in one of the FEHB High Deductible Health Plans (HDHP) with a Health Savings Account (HSA), there are a TON of tax land mines to be aware of.  I’ll cover the specifics of bailing out of an HSA part-way through a Tax/Plan Year in an upcoming post.

Q: Where’s my FSA?  A: Your FSA is gone.  This is not mentioned in the TCC brochures and FAQs, but if you had a Medical Spending Flexible Spending Account (FSA), it turned in to a pumpkin during the pay period in which you separated. If you had an HSA, it’s yours forever, but there are  a few caveats (details on maintaining your FEHB HSA in a future post).

Q: How much does TCC cost?  A: TCC Premiums are 102% of the total FEHB Premium. The Guide to Federal Benefits (RI 70-5) lists the premiums (starts on page 60).  Or you can just go to the FEHB premiums guide at opm.gov and multiply the ‘Total Premium’ monthly column by 102%.

Q: Is TCC the best deal for my family?  A: ObamaCare might be Cheaper.  If you separate from federal service in 2014 and later, ObamaCare might be a better deal than TCC (especially if you anticipate your total income to be less than $70,000 per year).

Now that you know the eligibility requirements, benefits, and costs, you can make your TCC choice.  If you choose to Elect TCC (beyond your no-cost 31 day extension), you may download form SF 2809  and submit to your former employing agency.

For More info, check the TCC Pamphlet, or the TCC FAQ,  or call your Agency’s Benefits Line.

…Just don’t call this guy to ask about COBRA 🙂

 

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