FEHB does not require you to enroll in Medicare Part B at 65, so for most federal retirees taking Part B is a choice: you pay the Part B premium, $202.90 a month in 2026 before any IRMAA surcharge, in exchange for Medicare paying first and your FEHB plan covering much of what is left (CMS, retrieved 2026-10-11).
Most Americans turning 65 have an easy Medicare decision because their old employer plan goes away. Federal retirees do not. You can keep FEHB for life, and FEHB does not make you take Medicare Part B. So you face a real choice, with real money on both sides.
There is no single right answer, and this guide will not give you one. It explains how the two programs fit together, what Part B costs in 2026 including the IRMAA surcharges, the postal exception, and the factors that push people one way or the other.
Picture it as a two-layer roof. FEHB alone is one solid layer. Adding Medicare puts a second layer underneath. Two layers leak less, but the second layer has a monthly price, and whether it pays for itself depends on the weather you expect.
01How do FEHB and Medicare work together?
When you are retired and have both, Medicare generally pays first and your FEHB plan pays second. Many FEHB plans then waive their deductibles, copays, and coinsurance for services Medicare covers, which can bring your out-of-pocket costs close to zero for covered care (OPM, retrieved 2026-10-11).
- Part A (hospital)Premium-free for about 99 percent of beneficiaries who have enough work history. Most federal employees hired after 1983 have paid Medicare tax and qualify (CMS, retrieved 2026-10-11).
- Part B (medical)Doctor visits, outpatient care, and tests. Has a monthly premium, $202.90 standard in 2026, plus IRMAA for higher incomes.
- Part D (drugs)Prescription coverage. OPM notes you must have Part A or Part B to elect a Part D plan through FEHB, and many FEHB plans now include one for Medicare-eligible annuitants (OPM, retrieved 2026-10-11).
- Medicare Advantage (Part C)A private plan that replaces Original Medicare. You must have Parts A and B to join one through FEHB, and many such plans reimburse some or all of your Part B premium (OPM, retrieved 2026-10-11).
- Primary payerThe plan that pays a claim first. For retirees, Medicare. For employees 65 and older still covered through active federal employment, FEHB.
Part A is premium-free for most people who qualify, and FEHB plans coordinate with it, so for many retirees the decision centers on Part B.
02Do you need Medicare Part B if you have FEHB?
No, FEHB does not require Part B. OPM states plainly that the FEHB Program has no Medicare Part B enrollment requirement, unlike PSHB (OPM, retrieved 2026-10-11). You can keep your FEHB plan with Part A only, or with no Medicare at all, and your FEHB plan remains your primary coverage for outpatient care.
What you give up by skipping Part B is the second layer. Your FEHB plan pays outpatient claims as usual, with its normal deductibles and copays. What you save is the Part B premium, which for a married couple both at the standard rate is about $4,870 a year in 2026.
03What are the 2026 IRMAA brackets?
IRMAA, the income-related monthly adjustment amount, is a surcharge added to the Part B premium (and to Part D) when your income is above set thresholds. For 2026, it starts above $109,000 of modified adjusted gross income for individual filers and above $218,000 for joint filers (CMS, retrieved 2026-10-11). Social Security generally uses the tax return from two years earlier, so 2026 premiums usually reflect 2024 income.
| 2026 MAGI, individual return | 2026 MAGI, joint return | Part B IRMAA | Total monthly Part B | Part D IRMAA |
|---|---|---|---|---|
| $109,000 or less | $218,000 or less | $0.00 | $202.90 | $0.00 |
| Above $109,000 up to $137,000 | Above $218,000 up to $274,000 | $81.20 | $284.10 | $14.50 |
| Above $137,000 up to $171,000 | Above $274,000 up to $342,000 | $202.90 | $405.80 | $37.50 |
| Above $171,000 up to $205,000 | Above $342,000 up to $410,000 | $324.60 | $527.50 | $60.40 |
| Above $205,000, under $500,000 | Above $410,000, under $750,000 | $446.30 | $649.20 | $83.30 |
| $500,000 or more | $750,000 or more | $487.00 | $689.90 | $91.00 |
Source: CMS 2026 fact sheet, retrieved 2026-10-11. Married people who lived with a spouse and file separately use a different, steeper table. The brackets reset every year; our IRMAA brackets data page carries the current table and will add 2027 figures when CMS publishes them.
04What is the Part B late enrollment penalty?
If you do not sign up for Part B when first eligible and later enroll, Medicare adds 10 percent to your premium for each full 12-month period you could have had Part B but did not, and you generally pay it for as long as you have Part B (Medicare.gov, retrieved 2026-10-11).
Here is the catch for federal retirees. You can usually delay Part B without penalty while you have group health coverage based on current employment, yours or your spouse's, and then use a Special Enrollment Period after that job or coverage ends. Retiree FEHB is not coverage based on current employment. So if you are already retired at 65 and decide to skip Part B, then change your mind at 70, you face a late enrollment penalty plus a wait for the next General Enrollment Period.
- Still working at 65. Your FEHB through active employment generally lets you delay Part B and enroll later in a Special Enrollment Period without penalty.
- Retired before 65. Your initial enrollment window around your 65th birthday is the penalty-free moment. Skipping it is a decision you may live with permanently.
- Retiring after 65. Plan your Part B start around your retirement date so there is no gap in the special enrollment window.
05What is different for postal annuitants in PSHB?
Certain Medicare-eligible postal annuitants and their Medicare-eligible family members must enroll in Part B to keep PSHB coverage. If an affected annuitant does not enroll in Part B, they cannot keep PSHB in retirement, and OPM says enrolling in Part B later does not restore that option (OPM, retrieved 2026-10-11).
The requirement has exceptions. Among them, OPM lists annuitants who were already retired on January 1, 2025 and not enrolled in Part B, postal employees who were 64 or older on January 1, 2025, people living outside the United States, and people eligible for VA health benefits or Indian Health Service care (OPM, retrieved 2026-10-11). OPM's own forms word the January 1, 2025 tests slightly differently, so a postal employee should confirm their status with the PSHB annuitant guidance before retirement.
06Worked example: what does the second layer cost?
Here is an educational comparison for one retiree, single filer, 2024 income under $109,000, in a hypothetical FEHB plan. It shows how to set up the math, not what you will pay.
| Hypothetical year | FEHB only | FEHB plus Part B |
|---|---|---|
| Part B premium (12 x $202.90) | $0 | $2,434.80 |
| FEHB premium share (same either way) | $3,600 | $3,600 |
| Expected out-of-pocket, normal year | $1,800 | $300 |
| Normal-year total | $5,400 | $6,334.80 |
| Expected out-of-pocket, heavy-use year | $6,500 | $500 |
| Heavy-use year total | $10,100 | $6,534.80 |
| Part B reimbursement from a plan option, if any | $0 | Subtract it |
In a light year, FEHB alone costs less. In a heavy year, the second layer saves money. If your FEHB plan or a Medicare Advantage option reimburses part of the Part B premium, the gap narrows. If IRMAA applies, it widens.
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07What factors should you weigh before deciding on Part B?
There is no recommendation here, because the right answer turns on facts only you know. These are the factors that usually decide it.
- Your expected health care use. Frequent care, chronic conditions, or a planned procedure favor the second layer. Light use favors FEHB alone.
- Your income and IRMAA tier. A surcharge can double or triple the cost of Part B.
- Your plan's Medicare coordination. Check whether your plan waives cost sharing when Medicare pays first, and whether it or a Medicare Advantage option reimburses any Part B premium.
- Access outside the plan network. Original Medicare is accepted by most doctors nationwide, which can matter if you travel or move.
- The penalty and the one-way door. Skipping Part B in retirement is hard to reverse cheaply later.
- Your spouse. Each of you makes a separate Medicare decision, and ages, incomes, and health may differ.
- Postal status. If PSHB's Part B requirement applies to you, the decision is made for you.
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08Can you suspend FEHB if you join Medicare Advantage?
Yes. If you join a Medicare Advantage plan outside FEHB, OPM allows annuitants to suspend FEHB rather than cancel it, which keeps your right to return to FEHB later. Canceling, by contrast, is permanent for annuitants (OPM, retrieved 2026-10-11). OPM also notes that you can join a Medicare Advantage plan offered through FEHB, which requires Parts A and B and in many cases reimburses some or all of the Part B premium.
Suspend keeps the door open. Cancel closes it for good.
09Moving forward with the decision at 65
The Medicare decision lands right after retirement for many federal employees, which means it gets made while you are still sorting out your annuity, your survivor election, and your TSP. It deserves its own time. Start your planning a year before your 65th birthday, and check your income for the IRMAA year two years earlier.
From here, review the FEHB guide for the five-year rule, use the open season guide to compare plans on how they work with Medicare, and check the retirement application guide if your retirement date and 65th birthday are close together.
FFEBA is an education organization. If you want someone to look at your own numbers, we can match you with a Federal Retirement Consultant (FRC), a professional trained on federal benefits. The FRC designation is listed with FINRA. The first review is free, nothing is booked until you choose a time, and you are never obligated to work with anyone we introduce. Get matched with an FRC.
10Questions federal employees ask
Do I have to take Medicare Part B if I have FEHB?
No. FEHB has no Part B enrollment requirement, so most federal retirees can keep FEHB without Part B. Two exceptions: you need Parts A and B to join a Medicare Advantage plan through FEHB, and certain postal annuitants must enroll in Part B to keep PSHB coverage (OPM, retrieved 2026-10-11).
How much is Medicare Part B in 2026?
The standard Part B premium is $202.90 a month in 2026, and the annual deductible is $283. Higher-income enrollees pay an income-related surcharge, IRMAA, that raises the total to as much as $689.90 a month (CMS, retrieved 2026-10-11).
Is there a penalty for delaying Part B if I have FEHB?
There can be. Medicare charges an extra 10 percent for each full 12-month period you could have had Part B but did not. Coverage based on current employment generally lets you delay without penalty, but retiree FEHB coverage is not current employment coverage, so a retiree who delays and enrolls later may pay the penalty for life (Medicare.gov, retrieved 2026-10-11).
Should I drop FEHB once I have Medicare?
OPM cautions that canceling FEHB is permanent for annuitants. If you join a Medicare Advantage plan outside FEHB you can suspend FEHB instead, which preserves your right to return. Weigh the long-term value of FEHB before canceling (OPM, retrieved 2026-10-11).
What are the 2026 IRMAA brackets?
For 2026, Part B surcharges start above $109,000 of modified adjusted gross income for individual filers and $218,000 for joint filers, with five surcharge tiers up to $689.90 a month total. IRMAA generally uses your tax return from two years earlier (CMS, retrieved 2026-10-11).
Which pays first, FEHB or Medicare?
For a retiree, Medicare generally pays first and FEHB pays second. For someone 65 or older who is still working for the government and covered by FEHB through that job, FEHB generally pays first.
Reviewed by the FFEBA education team. Last reviewed October 2026.
Sources
- Centers for Medicare & Medicaid Services, 2026 Medicare Parts A & B Premiums and Deductibles (fact sheet, November 14, 2025), retrieved 2026-10-11
- U.S. Office of Personnel Management, Medicare and FEHB, retrieved 2026-10-11
- U.S. Office of Personnel Management, PSHB Program, retrieved 2026-10-11
- U.S. Office of Personnel Management, PSHB annuitant and Medicare, retrieved 2026-10-11
- Medicare.gov, Avoid late enrollment penalties, retrieved 2026-10-11
- U.S. Office of Personnel Management, Federal Benefits Open Season Highlights, 2027 Plan Year, retrieved 2026-10-11
Every government figure on this page carries its source and retrieval date. Worked examples are educational estimates on the assumptions shown, not a projection of any person's benefit. FFEBA is an education organization, not a financial advisor.
