This is incorrect. I was able to confirm that the 5-year requirement does not have to be continuous. Specifically, a break in service does not count as an interruption as long as the employee re-enrolls in FEHB within 60 days after being re-hired.
From the Office of Personnel Management, FEHB Program Handbook:
Break in Service
Breaks in service are not counted as interruptions when the 5 years of service requirement is determined, as long as the individual reenrolls within 60 days after his/her return to Federal service.
Joan elected FEHB coverage on February 11, 2007, and had a break in service from January 1, 2011 through January 1, 2013. Upon her return to service, she again elected to enroll. She retires on December 31, 2014. She is eligible to continue her health benefits coverage into retirement, since she has been continuously enrolled for the 5 years of service prior to retirement.
Eduardo elected not to enroll in the FEHB Program upon his employment. He left Federal service in 2011. He was rehired in 2011, and elected to enroll. When he retired in 2014, he was not eligible to continue health benefits into retirement since he was not covered for the five years of service before his retirement. His 2011 rehire date does not count as his first opportunity to be insured because of his prior employment in which he elected not to enroll.
So, to pull off what the OP was inquiring about an ATCS would have to:
1) Accrue 20 years of "good time;"
2) Keep FEHB coverage for at least the last five of those 20 years;
3) Resign. Work in the private sector, for another Federal Agency, do freelance work, or for those lucky enough not work at all. Those who choose to transfer to another FERS-covered position (either at the FAA or another Federal Agency) can skip to #6. All others continue with #4;
4) Get rehired in any FERS-covered position at any Federal Agency after and/or approaching their 50th birthday;
5) Enroll in FEHB within 60 days from the date of hire;
6) Optional: wait for confirmation of FEHB enrollment and/or receipt of health insurance card before submitting an application for retirement. In a worst case scenario I see how OPM could potentially argue that the employee is not eligible to keep coverage in retirement because because the FEHB enrollment hadn't fully processed when the employee submitted the application for retirement. Maybe I am being overly cautious, but why risk it.
6) Submit an Application for Immediate Retirement under the Special ATC provision on or after their 50th birthday.
7) Enjoy their hard-earned annuity, FEHB benefits, and access to their TSP without having to pay the 10% penalty.
For most ATCS, time spent at the Academy is not a covered position under Public Law 92-297 and therefore does not count towards good time. The 20-year clock starts from the day you are assigned to your first facility. Check your SF-50s: the one generated after starting the Academy will say POSITION NOT COVERED FOR EARLY RETIREMENT PURPOSES, while the subsequent initial appointment to your first facility will say ATC POSITION COVERED FOR EARLY RETIREMENT PURPOSES. The last thing one would want to do is resign with 19yrs 8mos of good time and realize years later (when it's too late) that they would not be eligible for retirement under the special ATC provision. If that were to happen, I don't see what recourse that employee would have other than trying to get rehired by the FAA in a 2152 position for 4 months to get to the minimum 20 year requirement, which may be hard/impossible to do if the FAA chooses not to rehire them.
Please refer to the attached .pdf file. It's a page from Chapter 46 of OPM's CSRS/FERS Handbook. I highlighted the key part: "at separation."
Separation means either resignation, voluntary/involuntary retirement, or removal (termination). An an example, if you resign at 45 with 20 years of good time, that's when you are separated from FERS. At that time of that separation, you don't meet both requirements (20 years of good time AND 50 yrs of age). You can't just wait until you turn 50 and then try to apply for a retirement annuity because you have to meet both requirements at the same time you separate. Hence the little workaround: get rehired in any FERS-covered position at 50 and you can then separate a second time by virtue of a voluntary retirement. Because you're old enough and now meet both the 20 yrs requirement as well at the 50y.o. requirement, you are eligible to retire under the special ATC provision.
And now the million dollar question that everybody has been asking: "This all sounds great, but has ANYONE actually done this successfully? And is there any proof?" The answer is yes, this has been done successfully numerous times, but as with everything don't take the word of a random guy posting away on internet forum. Trust, but verify.
Chris Barfield (who incidentally retired as a Supervisory Special Agent with the FBI after 20 years of service under the special FF/LEO/ATC provision) is self-employed Certified Public Accountant/Certified Fraud Examiner. While Mr. Barfield did not take advantage of the resign/retire workaround himself, he has had a number of Federal LEO clients that were successful in doing so, including some that were separated as a result of removal (i.e. fired from their job) luckily after having accrued 20 years of good time, but before turning 50. Mr. Barfield is intimately familiar with the intricacies of the special provisions for early retirement (FF/LEO/ATC are all treated the same). I am posting his information below for those of you would like to schedule a consultation with him:
Chris A. Bartfield - CPA License # CP11900250
275 Medical Drive
PO Box 4721
Carmel, Indiana 46032
Still skeptical? You should be. 20 years spent as an ATCS is a long time, and nobody wants to risk their annuity because of bad advice. For a second opinion (or even in lieu of Mr. Bartfield, if you prefer - I am not affiliated with either) you may consider getting in touch with Dan Jamison, a nationally recognized subject-matter expert on retirement benefits for federal employees, including law enforcement officers, firefighters, air traffic controllers and those persons covered under the Special Category Employee (SCE) Provisions of FERS.
FERS GUIDE, LLC
FERS Retirement & Divorce Services
Like Mr. Bartfield, Mr. Jamison is a former FBI Special Agent who retired under the early retirement provision after 21 years of service. According to Mr. Bartfield, Mr. Jamison has also personally assisted SCEs that were removed after 20 years of good time, but before they turned 50. Quote from Mr. Bartfield:
"By the way, both Dan Jamison and I have several real-world instances of this exact situation. But because it would be embarrassing for those involved, real-world instances are not used. But think of some of the nationwide stories you’ve heard of federal agents being fired—some of those exact individuals have contacted us and have retired under scenarios just like this."
So, there you have it. Sorry for the long post, but I figured that a good number of people may find this information useful and I just wanted to share my findings. MJ, you may want to make this a sticky. I -as well as many others- have been looking for information like this for a long time, but have never been able to talk to someone who has actually, verifiably, accomplished what it has been discussed in the post. For some, this could be a game changer and affect how long they decide to stay in this profession. At least they'll know that after 20 years they have other options. Personally, Mr. Bartfield's knowledge has provided me the option to leave this profession three years before I thought it would be possible. That's three years of my life where I would never have to hear/use the words "light" and "chop" in the same sentence multiple times a day. Bless his heart!