✅ Retired Fed Pays $0 for Healthcare—Legally. Here's How.

May 22, 2025

What if we told you it’s possible to retire from federal service and never pay another dime for healthcare…

No premiums, no copays, no out-of-pocket surprises?

Sounds like a gimmick, right?

It’s not.

Meet Jack, a retired GS-13 who left service at age 60 and managed to structure his retirement healthcare so efficiently that his total healthcare costs dropped to $0—legally.

Here’s exactly how he did it (and how you might be able to, too).

🩺 Step 1: He Met the FEHB 5-Year Rule

Jack kept his FEHB (Federal Employees Health Benefits) coverage for at least five years before retiring.

This allowed him to carry it into retirement—a crucial first requirement for any version of this strategy.

✅ If you don’t meet this rule, the rest doesn’t matter—your FEHB doesn’t come with you.

💡 Step 2: He Paired FEHB with Medicare Part B (at the Right Time)

When Jack turned 65, he enrolled in Medicare Part B during his Initial Enrollment Period (IEP).

Most federal retirees hesitate here due to the added premium—but Jack was strategic.

Why? Because certain FEHB plans become “wraparound” plans when you enroll in Medicare. That means:

  • No copays

  • No deductibles

  • No coinsurance

  • No surprises

💸 Step 3: He Chose a Plan That Reimburses His Part B Premium

Here’s the real secret: Jack chose an FEHB plan that actually reimburses all or part of his Medicare Part B premiums.

Some plans (like MHBP Standard Option, Aetna Direct, or certain Kaiser plans) will send you a tax-free reimbursement check for enrolling in Part B.

Jack’s plan reimbursed 100% of his monthly premium.

That’s $2,000+ per year, back in his pocket.

🧠 Step 4: He Banked an HSA in His Pre-Medicare Years

Before signing up for Medicare, Jack used a High Deductible Health Plan (HDHP) and maxed out his Health Savings Account (HSA).

That gave him a tax-free bucket to cover any fringe or unexpected medical expenses—just in case.

He ended up using none of it. But it’s there, ready.

⚠️ Want to Replicate This? Here’s the Catch:

  • You must plan ahead—this works best when started 5+ years before retirement.

  • Not all FEHB plans reimburse Part B or offer wraparound coverage—you must compare the fine print.

  • If you skip Medicare Part B, you miss out on the biggest savings and protections.

  • The most generous plans can change year to year—staying informed is key.

🎯 Your Takeaway:

Jack didn’t have some secret connection. He didn’t need Congress to pass a law.

He just understood the system and optimized the rules.

If you’re planning to retire within the next few years, the time to research your FEHB/Medicare strategy is now—not later.

Best,
Federal Wealth Retirement