Early Medical Retirement for Disabled Federal Workers: Intersection with VERA

Questions always abound when Federal agencies and the U.S. Postal Service offer incentivized programs under the Voluntary Early Retirement Authority (VERA) propounded by the U.S. Office of Personnel Management.  In accepting a VERA, the Federal or Postal employee who suffers from a medical condition must take into account whether the VERA should take the place of a Federal Disability Retirement application, or whether it will merely be the first step in the process of filing for Federal Disability Retirement.

Often, because Federal Disability Retirement takes many months in order to secure and procure, Federal and Postal employees considering such an option will elect to accept a VERA in order to have some income during the time of filing for, and waiting upon, a decision from the U.S. Office of Personnel Management in a Federal Disability Retirement application.

Questions which the potential Federal or Postal VERA annuitant should ask themselves include: What impact does a Federal Disability Retirement application have upon a VERA? Is there an offset between Social Security and the VERA annuity, as opposed to the offset which occurs under Federal Disability Retirement, and if so, which provides greater financial sense? Are there provisions where, if the Federal or Postal employee accepts a VERA, one must repay any lump sum incentive which is offered, if one subsequently files for Federal Disability Retirement benefits and gets it approved?

While it often makes sense to accept a VERA, then to subsequently file for Federal Disability Retirement benefits within one (1) year of being separated from Federal Service as a result of the VERA, one should nevertheless do so with full knowledge and information.

As a final point, in addition to obtaining all information and basing one’s decision upon full knowledge, the fact that the years which one is on Federal Disability Retirement counts toward the total number of years of one’s Federal Service, should always be factored in — especially if one lives to be a ripe old age, where one’s retirement nest egg will be an important future consideration.

Sincerely,

Robert R. McGill, Esquire

OPM Disability Retirement: The Durational Attitude, Or: “If Only I Had…”

There are periodic offers for an “early out”; or the ability upon reaching certain trigger points of leaving the Federal Government; or receiving OWCP benefits, which is certainly a higher rate of immediate return (assuming qualification and eligibility has been established); or even a settlement for a separation with some severance pay, a lump sum to settle a lawsuit, etc.

On the other hand, one of the advantages of a Federal Disability Retirement benefit, of course, is that the number of years which one remains on Federal Disability Retirement counts toward the total number of years of service, such that at age 62, when the Disability Retirement benefit is recalculated as regular retirement, those years on Disability Retirement are calculated into the benefit. Thus, for those who live to be a ripe old age, those differences in percentage points will continue to reap the benefits.

It is the long-term viewpoint which should always be considered; for, in later years, the durational perspective, if not taken, may well result in the rueful reminiscence of a forlorn, regretful attitude.  One may make statements of vacuity, such as, “I don’t live with regrets”; but the annuity and one’s bank account may tell a different story.

Planning for the future in preparing, formulating and filing for Federal Disability Retirement benefits, whether under FERS or CSRS, from the U.S. Office of Personnel Management, entails, involves, and encapsulates more than just the “now” and the “present”; it is the immediacy of the future which one should always plan for.

Sincerely,

Robert R. McGill, Esquire