What is Premium Conversion?
Many of the benefits offered by the federal government (FEHB, FSAs, FEDVIP) will be subject to automatic enrollment in premium conversion unless you waive this coverage (you may ONLY waive coverage for FEHB). Premium conversion is a federal tax benefit where premiums are withheld from your bi-weekly paycheck on a pre-tax basis (i.e. they are not subject to Federal tax, Medicare, or Social Security taxes).
Consider waiving premium conversion if you want to be eligible to drop FEHB coverage or change enrollment (i.e. from Self and Family to Self Only) at any time. Usually this type of change can only be made after a Qualifying Life Event (QLE) or Federal Benefits Open Season. Additionally, you may be eligible to receive higher Social Security benefits if premium coverage is waived.
What is a Qualifying Life Event?
A Qualifying Life Event (QLE) is a term defined by OPM to describe events deemed acceptable by the IRS that may allow participants in cafeteria plans (including premium conversion) to change their participation election for premium conversion outside of an open season.
A complete list of Qualifying Life Events may be found in the SF 2809: Health Benefits Election Form. Examples of QLEs include:
- Death of a spouse
- Change in employment status
- Last dependent child loses coverage because of age limit
- Restoration to civilian employment after serving in uniformed service
What is Open Season?
Open Season allows employees to make permissible enrollment changes or add coverage each year. You may also change providers. Each year OPM provides an Open Season from the Monday of the second full workweek in November through the Monday of the second full workweek in December.
The Director of OPM may modify the dates of Open Season or announce additional open seasons.
Your Open Season election generally will take effect the following January.
What is a Personal Statement of Benefits?
Personal Statements of Benefits is a document that lists:
- Value of your life insurance
- Cost of your Health Insurance
- Optional Retirement Benefits
- Disability Retirement Benefits
- Survivor Benefits
- Value of your annual leave (if you leave the federal service)