OPM receives more new retirement claims in January than any other month, because federal employees like to take advantage of accumulating a large sum of annual leave by retiring at or near the end of the leave year. So there are a lot of new retirees right now, which has led to a backlog in the processing of new benefits claims. Unfortunately, it can take OPM five to eight months to process your retirement application, and in the interim you may receive only partial payments.
Although there isn’t much a new retiree can do about the claims backlog, there are a few things you can do to be sure your employee benefits continue while you’re waiting for the final processing of your retirement.
Here’s your New Retiree Checklist of things to check on:
Federal Long-Term Care Insurance Program. Your premiums will not be deducted from your retirement while you are receiving interim retirement payments from OPM, so you will need to make separate payment arrangements. Read more information about cost and payment options here.
Federal Employees Dental and Vision Insurance Program. Contact BENEFEDS, which runs the insurance program, when you retire if you carry supplemental dental or vision coverage. You’ll need to pay the premiums for this coverage until your retirement claim is finalized. Here’s more information.
Medicare. If you’re over 65, now might be a good time to enroll. You may have already enrolled in Medicare Part A in your initial enrollment period, which started three months before you turned 65 and lasted for seven months. There is also a special enrollment period that lasts for eight months following your retirement. During this time, you can enroll in Medicare Part B without a late enrollment surcharge as long as you were covered by health insurance that was deducted from a current employees salary (yours or your spouses). Here’s more information. If you are planning to enroll in Part B, you may be able to change your federal health plan to complement your Medicare coverage. You may change your FEHB enrollment to any available plan or option at any time beginning 30 days before you become eligible for Medicare, but you may only use this enrollment change opportunity once.
TSP. Some new retirees decide to take a distribution from their TSP account after retirement and will need information on withdrawal options as well as tax information regarding those payments. The TSP offers a set of important important resources to guide you.
Social Security. If you’re between 62 and 66, and are eligible for Social Security retirement benefits, you may wish to contact the Social Security Administration to apply. If you are under your full retirement age, there is an earnings limit that will cause your Social Security benefit to be reduced by $1 for every $2 that you earn over the annual limit ($15,120 in 2013). Certain types of income, such as lump sum payments for annual leave, federal retirement benefits and withdrawals from the Thrift Savings Plan, do not count against this limit. (You may need to have your payroll office submit form SSA-131 to let Social Security know your lump sum payment for annual leave is not a regular paycheck.)