Congressional Record, Volume 146 Issue 100 (Thursday, July 27, 2000)

[Congressional Record Volume 146, Number 100 (Thursday, July 27, 2000)]
[House]
[Pages H7181-H7188]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

LONG-TERM CARE SECURITY ACT

Mr. SCARBOROUGH. Mr. Speaker, I ask unanimous consent to take from
the Speaker's table the bill (H.R. 4040) to amend title 5, United
States Code, to provide for the establishment of a program under which
long-term care insurance is made available to Federal employees,
members of the uniformed services, and civilian and military retirees,
and for other purposes, with Senate amendments thereto, and concur in
the Senate amendments, with amendments.
The Clerk read the title of the bill.
The Clerk read the Senate amendments and the House amendments to the
Senate amendments as follows:

Senate amendments:
Strike out all after the enacting clause and insert:

TITLE I--FEDERAL LONG-TERM CARE INSURANCE

SEC. 1001. SHORT TITLE.

This title may be cited as the ``Long-Term Care Security
Act''.

SEC. 1002. LONG-TERM CARE INSURANCE.

(a) In General.--Subpart G of part III of title 5, United
States Code, is amended by adding at the end the following:

``CHAPTER 90--LONG-TERM CARE INSURANCE

``Sec.
``9001. Definitions.
``9002. Availability of insurance.
``9003. Contracting authority.
``9004. Financing.
``9005. Preemption.
``9006. Studies, reports, and audits.
``9007. Jurisdiction of courts.
``9008. Administrative functions.
``9009. Cost accounting standards.

``Sec. 9001. Definitions

For purposes of this chapter:
``(1) Employee.--The term `employee' means--
``(A) an employee as defined by section 8901(1); and
``(B) an individual described in section 2105(e),

but does not include an individual employed by the government
of the District of Columbia.
``(2) Annuitant.--The term `annuitant' has the meaning such
term would have under paragraph (3) of section 8901 if, for
purposes of such paragraph, the term `employee' were
considered to have the meaning given to it under paragraph
(1) of this subsection.
``(3) Member of the uniformed services.--The term `member
of the uniformed services' means a member of the uniformed
services, other than a retired member of the uniformed
services, who is--
``(A) on active duty or full-time National Guard duty for a
period of more than 30 days; and
``(B) a member of the Selected Reserve.
``(4) Retired member of the uniformed services.--The term
`retired member of the uniformed services' means a member or
former member of the uniformed services entitled to retired
or retainer pay, including a member or former member retired
under chapter 1223 of title 10 who has attained the age of 60
and who satisfies such eligibility requirements as the Office
of Personnel Management prescribes under section 9008.
``(5) Qualified relative.--The term `qualified relative'
means each of the following:
``(A) The spouse of an individual described in paragraph
(1), (2), (3), or (4).
``(B) A parent, stepparent, or parent-in-law of an
individual described in paragraph (1) or (3).
``(C) A child (including an adopted child, a stepchild, or,
to the extent the Office of Personnel Management by
regulation provides, a foster child) of an individual
described in paragraph (1), (2), (3), or (4), if such child
is at least 18 years of age.
``(D) An individual having such other relationship to an
individual described in paragraph (1), (2), (3), or (4) as
the Office may by regulation prescribe.
``(6) Eligible individual.--The term `eligible individual'
refers to an individual described in paragraph (1), (2), (3),
(4), or (5).
``(7) Qualified carrier.--The term `qualified carrier'
means an insurance company (or consortium of insurance
companies) that is licensed to issue long-term care insurance
in all States, taking any subsidiaries of such a company into
account (and, in the case of a consortium, considering the
member companies and any subsidiaries thereof, collectively).
``(8) State.--The term `State' includes the District of
Columbia.
``(9) Qualified long-term care insurance contract.--The
term `qualified long-term care insurance contract' has the
meaning given such term by section 7702B of the Internal
Revenue Code of 1986.
``(10) Appropriate secretary.--The term `appropriate
Secretary' means--
``(A) except as otherwise provided in this paragraph, the
Secretary of Defense;
``(B) with respect to the Coast Guard when it is not
operating as a service of the Navy, the Secretary of
Transportation;
``(C) with respect to the commissioned corps of the
National Oceanic and Atmospheric Administration, the
Secretary of Commerce; and
``(D) with respect to the commissioned corps of the Public
Health Service, the Secretary of Health and Human Services.

``Sec. 9002. Availability of insurance

``(a) In General.--The Office of Personnel Management shall
establish and, in consultation with the appropriate
Secretaries, administer

[[Page H7182]]

a program through which an individual described in paragraph
(1), (2), (3), (4), or (5) of section 9001 may obtain long-
term care insurance coverage under this chapter for such
individual.
``(b) General Requirements.--Long-term care insurance may
not be offered under this chapter unless--
``(1) the only coverage provided is under qualified long-
term care insurance contracts; and
``(2) each insurance contract under which any such coverage
is provided is issued by a qualified carrier.
``(c) Documentation Requirement.--As a condition for
obtaining long-term care insurance coverage under this
chapter based on one's status as a qualified relative, an
applicant shall provide documentation to demonstrate the
relationship, as prescribed by the Office.
``(d) Underwriting Standards.--
``(1) Disqualifying condition.--Nothing in this chapter
shall be considered to require that long-term care insurance
coverage be made available in the case of any individual who
would be eligible for benefits immediately.
``(2) Spousal parity.--For the purpose of underwriting
standards, a spouse of an individual described in paragraph
(1), (2), (3), or (4) of section 9001 shall, as nearly as
practicable, be treated like that individual.
``(3) Guaranteed issue.--Nothing in this chapter shall be
considered to require that long-term care insurance coverage
be guaranteed to an eligible individual.
``(4) Requirement that contract be fully insured.--In
addition to the requirements otherwise applicable under
section 9001(9), in order to be considered a qualified long-
term care insurance contract for purposes of this chapter, a
contract must be fully insured, whether through reinsurance
with other companies or otherwise.
``(5) Higher standards allowable.--Nothing in this chapter
shall, in the case of an individual applying for long-term
care insurance coverage under this chapter after the
expiration of such individual's first opportunity to enroll,
preclude the application of underwriting standards more
stringent than those that would have applied if that
opportunity had not yet expired.
``(e) Guaranteed Renewability.--The benefits and coverage
made available to eligible individuals under any insurance
contract under this chapter shall be guaranteed renewable (as
defined by section 7A(2) of the model regulations described
in section 7702B(g)(2) of the Internal Revenue Code of 1986),
including the right to have insurance remain in effect so
long as premiums continue to be timely made. However, the
authority to revise premiums under this chapter shall be
available only on a class basis and only to the extent
otherwise allowable under section 9003(b).

``Sec. 9003. Contracting authority

``(a) In General.--The Office of Personnel Management
shall, without regard to section 5 of title 41 or any other
statute requiring competitive bidding, contract with one or
more qualified carriers for a policy or policies of long-term
care insurance. The Office shall ensure that each resulting
contract (hereafter in this chapter referred to as a `master
contract') is awarded on the basis of contractor
qualifications, price, and reasonable competition.
``(b) Terms and Conditions.--
``(1) In general.--Each master contract under this chapter
shall contain--
``(A) a detailed statement of the benefits offered
(including any maximums, limitations, exclusions, and other
definitions of benefits);
``(B) the premiums charged (including any limitations or
other conditions on their subsequent adjustment);
``(C) the terms of the enrollment period; and
``(D) such other terms and conditions as may be mutually
agreed to by the Office and the carrier involved, consistent
with the requirements of this chapter.
``(2) Premiums.--Premiums charged under each master
contract entered into under this section shall reasonably and
equitably reflect the cost of the benefits provided, as
determined by the Office. The premiums shall not be adjusted
during the term of the contract unless mutually agreed to by
the Office and the carrier.
``(3) Nonrenewability.--Master contracts under this chapter
may not be made automatically renewable.
``(c) Payment of Required Benefits; Dispute Resolution.--
``(1) In general.--Each master contract under this chapter
shall require the carrier to agree--
``(A) to provide payments or benefits to an eligible
individual if such individual is entitled thereto under the
terms of the contract; and
``(B) with respect to disputes regarding claims for
payments or benefits under the terms of the contract--
``(i) to establish internal procedures designed to
expeditiously resolve such disputes; and
``(ii) to establish, for disputes not resolved through
procedures under clause (i), procedures for one or more
alternative means of dispute resolution involving independent
third-party review under appropriate circumstances by
entities mutually acceptable to the Office and the carrier.
``(2) Eligibility.--A carrier's determination as to whether
or not a particular individual is eligible to obtain long-
term care insurance coverage under this chapter shall be
subject to review only to the extent and in the manner
provided in the applicable master contract.
``(3) Other claims.--For purposes of applying the Contract
Disputes Act of 1978 to disputes arising under this chapter
between a carrier and the Office--
``(A) the agency board having jurisdiction to decide an
appeal relative to such a dispute shall be such board of
contract appeals as the Director of the Office of Personnel
Management shall specify in writing (after appropriate
arrangements, as described in section 8(c) of such Act); and
``(B) the district courts of the United States shall have
original jurisdiction, concurrent with the United States
Court of Federal Claims, of any action described in section
10(a)(1) of such Act relative to such a dispute.
``(4) Rule of construction.--Nothing in this chapter shall
be considered to grant authority for the Office or a third-
party reviewer to change the terms of any contract under this
chapter.
``(d) Duration.--
``(1) In general.--Each master contract under this chapter
shall be for a term of 7 years, unless terminated earlier by
the Office in accordance with the terms of such contract.
However, the rights and responsibilities of the enrolled
individual, the insurer, and the Office (or duly designated
third-party administrator) under such contract shall continue
with respect to such individual until the termination of
coverage of the enrolled individual or the effective date of
a successor contract thereto.
``(2) Exception.--
``(A) Shorter duration.--In the case of a master contract
entered into before the end of the period described in
subparagraph (B), paragraph (1) shall be applied by
substituting `ending on the last day of the 7-year period
described in paragraph (2)(B)' for `of 7 years'.
``(B) Definition.--The period described in this
subparagraph is the 7-year period beginning on the earliest
date as of which any long-term care insurance coverage under
this chapter becomes effective.
``(3) Congressional notification.--No later than 180 days
after receiving the second report required under section
9006(c), the President (or his designee) shall submit to the
Committees on Government Reform and on Armed Services of the
House of Representatives and the Committees on Governmental
Affairs and on Armed Services of the Senate, a written
recommendation as to whether the program under this chapter
should be continued without modification, terminated, or
restructured. During the 180-day period following the date on
which the President (or his designee) submits the
recommendation required under the preceding sentence, the
Office of Personnel Management may not take any steps to
rebid or otherwise contract for any coverage to be available
at any time following the expiration of the 7-year period
described in paragraph (2)(B).
``(4) Full portability.--Each master contract under this
chapter shall include such provisions as may be necessary to
ensure that, once an individual becomes duly enrolled, long-
term care insurance coverage obtained by such individual
pursuant to that enrollment shall not be terminated due to
any change in status (such as separation from Government
service or the uniformed services) or ceasing to meet the
requirements for being considered a qualified relative
(whether as a result of dissolution of marriage or
otherwise).

``Sec. 9004. Financing

``(a) In General.--Each eligible individual obtaining long-
term care insurance coverage under this chapter shall be
responsible for 100 percent of the premiums for such
coverage.
``(b) Withholdings.--
``(1) In general.--The amount necessary to pay the premiums
for enrollment may--
``(A) in the case of an employee, be withheld from the pay
of such employee;
``(B) in the case of an annuitant, be withheld from the
annuity of such annuitant;
``(C) in the case of a member of the uniformed services
described in section 9001(3), be withheld from the pay of
such member; and
``(D) in the case of a retired member of the uniformed
services described in section 9001(4), be withheld from the
retired pay or retainer pay payable to such member.
``(2) Voluntary withholdings for qualified relatives.--
Withholdings to pay the premiums for enrollment of a
qualified relative may, upon election of the appropriate
eligible individual (described in section 9001(1)-(4)), be
withheld under paragraph (1) to the same extent and in the
same manner as if enrollment were for such individual.
``(c) Direct Payments.--All amounts withheld under this
section shall be paid directly to the carrier.
``(d) Other Forms of Payment.--Any enrollee who does not
elect to have premiums withheld under subsection (b) or whose
pay, annuity, or retired or retainer pay (as referred to in
subsection (b)(1)) is insufficient to cover the withholding
required for enrollment (or who is not receiving any regular
amounts from the Government, as referred to in subsection
(b)(1), from which any such withholdings may be made, and
whose premiums are not otherwise being provided for under
subsection (b)(2)) shall pay an amount equal to the full
amount of those charges directly to the carrier.
``(e) Separate Accounting Requirement.--Each carrier
participating under this chapter shall maintain records that
permit it to account for all amounts received under this
chapter (including investment earnings on those amounts)
separate and apart from all other funds.
``(f) Reimbursements.--
``(1) Reasonable initial costs.--
``(A) In general.--The Employees' Life Insurance Fund is
available, without fiscal year limitation, for reasonable
expenses incurred by the Office of Personnel Management in
administering this chapter before the start of the 7-year
period described in section 9003(d)(2)(B), including
reasonable implementation costs.
``(B) Reimbursement requirement.--Such Fund shall be
reimbursed, before the end of the first year of that 7-year
period, for all amounts obligated or expended under
subparagraph (A) (including lost investment income). Such
reimbursement shall be made by carriers, on a pro

[[Page H7183]]

rata basis, in accordance with appropriate provisions which
shall be included in master contracts under this chapter.
``(2) Subsequent costs.--
``(A) In general.--There is hereby established in the
Employees' Life Insurance Fund a Long-Term Care
Administrative Account, which shall be available to the
Office, without fiscal year limitation, to defray reasonable
expenses incurred by the Office in administering this chapter
after the start of the 7-year period described in section
9003(d)(2)(B).
``(B) Reimbursement requirement.--Each master contract
under this chapter shall include appropriate provisions under
which the carrier involved shall, during each year, make such
periodic contributions to the Long-Term Care Administrative
Account as necessary to ensure that the reasonable
anticipated expenses of the Office in administering this
chapter during such year (adjusted to reconcile for any
earlier overestimates or underestimates under this
subparagraph) are defrayed.

``Sec. 9005. Preemption

``The terms of any contract under this chapter which relate
to the nature, provision, or extent of coverage or benefits
(including payments with respect to benefits) shall supersede
and preempt any State or local law, or any regulation issued
thereunder, which relates to long-term care insurance or
contracts.

``Sec. 9006. Studies, reports, and audits

``(a) Provisions Relating to Carriers.--Each master
contract under this chapter shall contain provisions
requiring the carrier--
``(1) to furnish such reasonable reports as the Office of
Personnel Management determines to be necessary to enable it
to carry out its functions under this chapter; and
``(2) to permit the Office and representatives of the
General Accounting Office to examine such records of the
carrier as may be necessary to carry out the purposes of this
chapter.
``(b) Provisions Relating to Federal Agencies.--Each
Federal agency shall keep such records, make such
certifications, and furnish the Office, the carrier, or both,
with such information and reports as the Office may require.
``(c) Reports by the General Accounting Office.--The
General Accounting Office shall prepare and submit to the
President, the Office of Personnel Management, and each House
of Congress, before the end of the third and fifth years
during which the program under this chapter is in effect, a
written report evaluating such program. Each such report
shall include an analysis of the competitiveness of the
program, as compared to both group and individual coverage
generally available to individuals in the private insurance
market. The Office shall cooperate with the General
Accounting Office to provide periodic evaluations of the
program.

``Sec. 9007. Jurisdiction of courts

``The district courts of the United States have original
jurisdiction of a civil action or claim described in
paragraph (1) or (2) of section 9003(c), after such
administrative remedies as required under such paragraph (1)
or (2) (as applicable) have been exhausted, but only to the
extent judicial review is not precluded by any dispute
resolution or other remedy under this chapter.

``Sec. 9008. Administrative functions

``(a) In General.--The Office of Personnel Management shall
prescribe regulations necessary to carry out this chapter.
``(b) Enrollment Periods.--The Office shall provide for
periodic coordinated enrollment, promotion, and education
efforts in consultation with the carriers.
``(c) Consultation.--Any regulations necessary to effect
the application and operation of this chapter with respect to
an eligible individual described in paragraph (3) or (4) of
section 9001, or a qualified relative thereof, shall be
prescribed by the Office in consultation with the appropriate
Secretary.
``(d) Informed Decisionmaking.--The Office shall ensure
that each eligible individual applying for long-term care
insurance under this chapter is furnished the information
necessary to enable that individual to evaluate the
advantages and disadvantages of obtaining long-term care
insurance under this chapter, including the following:
``(1) The principal long-term care benefits and coverage
available under this chapter, and how those benefits and
coverage compare to the range of long-term care benefits and
coverage otherwise generally available.
``(2) Representative examples of the cost of long-term
care, and the sufficiency of the benefits available under
this chapter relative to those costs. The information under
this paragraph shall also include--
``(A) the projected effect of inflation on the value of
those benefits; and
``(B) a comparison of the inflation-adjusted value of those
benefits to the projected future costs of long-term care.
``(3) Any rights individuals under this chapter may have to
cancel coverage, and to receive a total or partial refund of
premiums. The information under this paragraph shall also
include--
``(A) the projected number or percentage of individuals
likely to fail to maintain their coverage (determined based
on lapse rates experienced under similar group long-term care
insurance programs and, when available, this chapter); and
``(B)(i) a summary description of how and when premiums for
long-term care insurance under this chapter may be raised;
``(ii) the premium history during the last 10 years for
each qualified carrier offering long-term care insurance
under this chapter; and
``(iii) if cost increases are anticipated, the projected
premiums for a typical insured individual at various ages.
``(4) The advantages and disadvantages of long-term care
insurance generally, relative to other means of accumulating
or otherwise acquiring the assets that may be needed to meet
the costs of long-term care, such as through tax-qualified
retirement programs or other investment vehicles.

``Sec. 9009. Cost accounting standards

``The cost accounting standards issued pursuant to section
26(f) of the Office of Federal Procurement Policy Act (41
U.S.C. 422(f)) shall not apply with respect to a long-term
care insurance contract under this chapter.''.
(b) Conforming Amendment.--The analysis for part III of
title 5, United States Code, is amended by adding at the end
of subpart G the following:

``90. Long-Term Care Insurance.................................9001.''.

SEC. 1003. EFFECTIVE DATE.

The Office of Personnel Management shall take such measures
as may be necessary to ensure that long-term care insurance
coverage under title 5, United States Code, as amended by
this title, may be obtained in time to take effect not later
than the first day of the first applicable pay period of the
first fiscal year which begins after the end of the 18-month
period beginning on the date of the enactment of this Act.

TITLE II--FEDERAL RETIREMENT COVERAGE ERRORS CORRECTION

SEC. 2001. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This title may be cited as the ``Federal
Erroneous Retirement Coverage Corrections Act''.
(b) Table of Contents.--The table of contents for this
title is as follows:

TITLE II--FEDERAL RETIREMENT COVERAGE ERRORS CORRECTION

Sec. 2001. Short title; table of contents.
Sec. 2002. Definitions.
Sec. 2003. Applicability.
Sec. 2004. Irrevocability of elections.

Subtitle A--Description of Retirement Coverage Errors to Which This
Title Applies and Measures for Their Rectification

Chapter 1--Employees and Annuitants Who Should Have Been FERS Covered,
but Who Were Erroneously CSRS Covered or CSRS-Offset Covered Instead,
and Survivors of Such Employees and Annuitants

Sec. 2101. Employees.
Sec. 2102. Annuitants and survivors.

Chapter 2--Employee Who Should Have Been FERS Covered, CSRS-Offset
Covered, or CSRS Covered, but Who Was Erroneously Social Security-Only
Covered Instead

Sec. 2111. Applicability.
Sec. 2112. Correction mandatory.

Chapter 3--Employee Who Should or Could Have Been Social Security-Only
Covered but Who Was Erroneously CSRS-Offset Covered or CSRS Covered
Instead

Sec. 2121. Employee who should be Social Security-Only covered, but who
is erroneously CSRS or CSRS-Offset covered instead.

Chapter 4--Employee Who Was Erroneously FERS Covered

Sec. 2131. Employee who should be Social Security-Only covered, CSRS
covered, or CSRS-Offset covered and is not FERS-Eligible,
but who is erroneously FERS covered instead.
Sec. 2132. FERS-Eligible employee who should have been CSRS covered,
CSRS-Offset covered, or Social Security-Only covered, but
who was erroneously FERS covered instead without an
election.
Sec. 2133. Retroactive effect.

Chapter 5--Employee Who Should Have Been CSRS-Offset Covered, but Who
Was Erroneously CSRS Covered Instead

Sec. 2141. Applicability.
Sec. 2142. Correction mandatory.

Chapter 6--Employee Who Should Have Been CSRS Covered, but Who Was
Erroneously CSRS-Offset Covered Instead

Sec. 2151. Applicability.
Sec. 2152. Correction mandatory.

Subtitle B--General Provisions

Sec. 2201. Identification and notification requirements.
Sec. 2202. Information to be furnished to and by authorities
administering this title.
Sec. 2203. Service credit deposits.
Sec. 2204. Provisions related to Social Security coverage of
misclassified employees.
Sec. 2205. Thrift Savings Plan treatment for certain individuals.
Sec. 2206. Certain agency amounts to be paid into or remain in the
CSRDF.
Sec. 2207. CSRS coverage determinations to be approved by OPM.
Sec. 2208. Discretionary actions by Director.
Sec. 2209. Regulations.

Subtitle C--Other Provisions

Sec. 2301. Provisions to authorize continued conformity of other
Federal retirement systems.
Sec. 2302. Authorization of payments.
Sec. 2303. Individual right of action preserved for amounts not
otherwise provided for under this title.

Subtitle D--Effective Date

Sec. 2401. Effective date.

SEC. 2002. DEFINITIONS.

For purposes of this title:
(1) Annuitant.--The term ``annuitant'' has the meaning
given such term under section 8331(9) or 8401(2) of title 5,
United States Code.
(2) CSRS.--The term ``CSRS'' means the Civil Service
Retirement System.

[[Page H7184]]

(3) CSRDF.--The term ``CSRDF'' means the Civil Service
Retirement and Disability Fund.
(4) CSRS covered.--The term ``CSRS covered'', with respect
to any service, means service that is subject to the
provisions of subchapter III of chapter 83 of title 5, United
States Code, other than service subject to section 8334(k) of
such title.
(5) CSRS-offset covered.--The term ``CSRS-Offset covered'',
with respect to any service, means service that is subject to
the provisions of subchapter III of chapter 83 of title 5,
United States Code, and to section 8334(k) of such title.
(6) Employee.--The term ``employee'' has the meaning given
such term under section 8331(1) or 8401(11) of title 5,
United States Code.
(7) Executive director.--The term ``Executive Director of
the Federal Retirement Thrift Investment Board'' or
``Executive Director'' means the Executive Director appointed
under section 8474 of title 5, United States Code.
(8) FERS.--The term ``FERS'' means the Federal Employees'
Retirement System.
(9) FERS covered.--The term ``FERS covered'', with respect
to any service, means service that is subject to chapter 84
of title 5, United States Code.
(10) Former employee.--The term ``former employee'' means
an individual who was an employee, but who is not an
annuitant.
(11) OASDI taxes.--The term ``OASDI taxes'' means the OASDI
employee tax and the OASDI employer tax.
(12) OASDI employee tax.--The term ``OASDI employee tax''
means the tax imposed under section 3101(a) of the Internal
Revenue Code of 1986 (relating to Old-Age, Survivors and
Disability Insurance).
(13) OASDI employer tax.--The term ``OASDI employer tax''
means the tax imposed under section 3111(a) of the Internal
Revenue Code of 1986 (relating to Old-Age, Survivors and
Disability Insurance).
(14) OASDI trust funds.--The term ``OASDI trust funds''
means the Federal Old-Age and Survivors Insurance Trust Fund
and the Federal Disability Insurance Trust Fund.
(15) Office.--The term ``Office'' means the Office of
Personnel Management.
(16) Retirement coverage determination.--The term
``retirement coverage determination'' means a determination
by an employee or agent of the Government as to whether a
particular type of Government service is CSRS covered, CSRS-
Offset covered, FERS covered, or Social Security-Only
covered.
(17) Retirement coverage error.--The term ``retirement
coverage error'' means an erroneous retirement coverage
determination that was in effect for a minimum period of 3
years of service after December 31, 1986.
(18) Social security-only covered.--The term ``Social
Security-Only covered'', with respect to any service, means
Government service that--
(A) constitutes employment under section 210 of the Social
Security Act (42 U.S.C. 410); and
(B)(i) is subject to OASDI taxes; but
(ii) is not subject to CSRS or FERS.
(19) Survivor.--The term ``survivor'' has the meaning given
such term under section 8331(10) or 8401(28) of title 5,
United States Code.
(20) Thrift savings fund.--The term ``Thrift Savings Fund''
means the Thrift Savings Fund established under section 8437
of title 5, United States Code.

SEC. 2003. APPLICABILITY.

(a) In General.--This title shall apply with respect to
retirement coverage errors that occur before, on, or after
the date of enactment of this Act.
(b) Limitation.--Except as otherwise provided in this
title, this title shall not apply to any erroneous retirement
coverage determination that was in effect for a period of
less than 3 years of service after December 31, 1986.

SEC. 2004. IRREVOCABILITY OF ELECTIONS.

Any election made (or deemed to have been made) by an
employee or any other individual under this title shall be
irrevocable.

Subtitle A--Description of Retirement Coverage Errors to Which This
Title Applies and Measures for Their Rectification

CHAPTER 1--EMPLOYEES AND ANNUITANTS WHO SHOULD HAVE BEEN FERS COVERED,
BUT WHO WERE ERRONEOUSLY CSRS COVERED OR CSRS-OFFSET COVERED INSTEAD,
AND SURVIVORS OF SUCH EMPLOYEES AND ANNUITANTS

SEC. 2101. EMPLOYEES.

(a) Applicability.--This section shall apply in the case of
any employee or former employee who should be (or should have
been) FERS covered but, as a result of a retirement coverage
error, is (or was) CSRS covered or CSRS-Offset covered
instead.
(b) Uncorrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error has not been corrected before the
effective date of the regulations described under paragraph
(3). As soon as practicable after discovery of the error, and
subject to the right of an election under paragraph (2), if
CSRS covered or CSRS-Offset covered, such individual shall be
treated as CSRS-Offset covered, retroactive to the date of
the retirement coverage error.
(2) Coverage.--
(A) Election.--Upon written notice of a retirement coverage
error, an individual may elect to be CSRS-Offset covered or
FERS covered, effective as of the date of the retirement
coverage error. Such election shall be made not later than
180 days after the date of receipt of such notice.
(B) Nonelection.--If the individual does not make an
election by the date provided under subparagraph (A), a CSRS-
Offset covered individual shall remain CSRS-Offset covered
and a CSRS covered individual shall be treated as CSRS-Offset
covered.
(3) Regulations.--The Office shall prescribe regulations to
carry out this subsection.
(c) Corrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error was corrected before the effective
date of the regulations described under subsection (b).
(2) Coverage.--
(A) Election.--
(i) CSRS-offset covered.--Not later than 180 days after the
date of enactment of this Act, the Office shall prescribe
regulations authorizing individuals to elect, during the 18-
month period immediately following the effective date of such
regulations, to be CSRS-Offset covered, effective as of the
date of the retirement coverage error.
(ii) Thrift savings fund contributions.--If under this
section an individual elects to be CSRS-Offset covered, all
employee contributions to the Thrift Savings Fund made during
the period of FERS coverage (and earnings on such
contributions) may remain in the Thrift Savings Fund in
accordance with regulations prescribed by the Executive
Director, notwithstanding any limit that would otherwise be
applicable.
(B) Previous settlement payment.--An individual who
previously received a payment ordered by a court or provided
as a settlement of claim for losses resulting from a
retirement coverage error shall not be entitled to make an
election under this subsection unless that amount is waived
in whole or in part under section 2208, and any amount not
waived is repaid.
(C) Ineligibility for election.--An individual who,
subsequent to correction of the retirement coverage error,
received a refund of retirement deductions under section 8424
of title 5, United States Code, or a distribution under
section 8433 (b), (c), or (h)(1)(A) of title 5, United States
Code, may not make an election under this subsection.
(3) Corrective action to remain in effect.--If an
individual is ineligible to make an election or does not make
an election under paragraph (2) before the end of any time
limitation under this subsection, the corrective action taken
before such time limitation shall remain in effect.

SEC. 2102. ANNUITANTS AND SURVIVORS.

(a) In General.--This section shall apply in the case of an
individual who is--
(1) an annuitant who should have been FERS covered but, as
a result of a retirement coverage error, was CSRS covered or
CSRS-Offset covered instead; or
(2) a survivor of an employee who should have been FERS
covered but, as a result of a retirement coverage error, was
CSRS covered or CSRS-Offset covered instead.
(b) Coverage.--
(1) Election.--Not later than 180 days after the date of
enactment of this Act, the Office shall prescribe regulations
authorizing an individual described under subsection (a) to
elect CSRS-Offset coverage or FERS coverage, effective as of
the date of the retirement coverage error.
(2) Time limitation.--An election under this subsection
shall be made not later than 18 months after the effective
date of the regulations prescribed under paragraph (1).
(3) Reduced annuity.--
(A) Amount in account.--If the individual elects CSRS-
Offset coverage, the amount in the employee's Thrift Savings
Fund account under subchapter III of chapter 84 of title 5,
United States Code, on the date of retirement that represents
the Government's contributions and earnings on those
contributions (whether or not such amount was subsequently
distributed from the Thrift Savings Fund) will form the basis
for a reduction in the individual's annuity, under
regulations prescribed by the Office.
(B) Reduction.--The reduced annuity to which the individual
is entitled shall be equal to an amount which, when taken
together with the amount referred to in subparagraph (A),
would result in the present value of the total being
actuarially equivalent to the present value of an unreduced
CSRS-Offset annuity that would have been provided the
individual.
(4) Reduced benefit.--If--
(A) a surviving spouse elects CSRS-Offset benefits; and
(B) a FERS basic employee death benefit under section
8442(b) of title 5, United States Code, was previously paid;

then the survivor's CSRS-Offset benefit shall be subject to a
reduction, under regulations prescribed by the Office. The
reduced annuity to which the individual is entitled shall be
equal to an amount which, when taken together with the amount
of the payment referred to under subparagraph (B) would
result in the present value of the total being actuarially
equivalent to the present value of an unreduced CSRS-Offset
annuity that would have been provided the individual.
(5) Previous settlement payment.--An individual who
previously received a payment ordered by a court or provided
as a settlement of claim for losses resulting from a
retirement coverage error may not make an election under this
subsection unless repayment of that amount is waived in whole
or in part under section 2208, and any amount not waived is
repaid.
(c) Nonelection.--If the individual does not make an
election under subsection (b) before any time limitation
under this section, the retirement coverage shall be subject
to the following rules:
(1) Corrective action previously taken.--If corrective
action was taken before the end of any time limitation under
this section, that corrective action shall remain in effect.
(2) Corrective action not previously taken.--If corrective
action was not taken before such time limitation, the
employee shall be CSRS-Offset covered, retroactive to the
date of the retirement coverage error.

[[Page H7185]]

CHAPTER 2--EMPLOYEE WHO SHOULD HAVE BEEN FERS COVERED, CSRS-OFFSET
COVERED, OR CSRS COVERED, BUT WHO WAS ERRONEOUSLY SOCIAL SECURITY-ONLY
COVERED INSTEAD

SEC. 2111. APPLICABILITY.

This chapter shall apply in the case of any employee who--
(1) should be (or should have been) FERS covered but, as a
result of a retirement coverage error, is (or was) Social
Security-Only covered instead;
(2) should be (or should have been) CSRS-Offset covered
but, as a result of a retirement coverage error, is (or was)
Social Security-Only covered instead; or
(3) should be (or should have been) CSRS covered but, as a
result of a retirement coverage error, is (or was) Social
Security-Only covered instead.

SEC. 2112. CORRECTION MANDATORY.

(a) Uncorrected Error.--If the retirement coverage error
has not been corrected, as soon as practicable after
discovery of the error, such individual shall be covered
under the correct retirement coverage, effective as of the
date of the retirement coverage error.
(b) Corrected Error.--If the retirement coverage error has
been corrected, the corrective action previously taken shall
remain in effect.

CHAPTER 3--EMPLOYEE WHO SHOULD OR COULD HAVE BEEN SOCIAL SECURITY-ONLY
COVERED BUT WHO WAS ERRONEOUSLY CSRS-OFFSET COVERED OR CSRS COVERED
INSTEAD

SEC. 2121. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY
COVERED, BUT WHO IS ERRONEOUSLY CSRS OR CSRS-
OFFSET COVERED INSTEAD.

(a) Applicability.--This section applies in the case of a
retirement coverage error in which a Social Security-Only
covered employee was erroneously CSRS covered or CSRS-Offset
covered.
(b) Uncorrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error has not been corrected before the
effective date of the regulations described in paragraph (3).
(2) Coverage.--In the case of an individual who is
erroneously CSRS covered, as soon as practicable after
discovery of the error, and subject to the right of an
election under paragraph (3), such individual shall be CSRS-
Offset covered, effective as of the date of the retirement
coverage error.
(3) Election.--
(A) In general.--Upon written notice of a retirement
coverage error, an individual may elect to be CSRS-Offset
covered or Social Security-Only covered, effective as of the
date of the retirement coverage error. Such election shall be
made not later than 180 days after the date of receipt of
such notice.
(B) Nonelection.--If the individual does not make an
election before the date provided under subparagraph (A), the
individual shall remain CSRS-Offset covered.
(C) Regulations.--The Office shall prescribe regulations to
carry out this paragraph.
(c) Corrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error was corrected before the effective
date of the regulations described under subsection (b)(3).
(2) Election.--Not later than 180 days after the date of
enactment of this Act, the Office shall prescribe regulations
authorizing individuals to elect, during the 18-month period
immediately following the effective date of such regulations,
to be CSRS-Offset covered or Social Security-Only covered,
effective as of the date of the retirement coverage error.
(3) Nonelection.--If an eligible individual does not make
an election under paragraph (2) before the end of any time
limitation under this subsection, the corrective action taken
before such time limitation shall remain in effect.

CHAPTER 4--EMPLOYEE WHO WAS ERRONEOUSLY FERS COVERED

SEC. 2131. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY
COVERED, CSRS COVERED, OR CSRS-OFFSET COVERED
AND IS NOT FERS-ELIGIBLE, BUT WHO IS
ERRONEOUSLY FERS COVERED INSTEAD.

(a) Applicability.--This section applies in the case of a
retirement coverage error in which a Social Security-Only
covered, CSRS covered, or CSRS-Offset covered employee not
eligible to elect FERS coverage under authority of section
8402(c) of title 5, United States Code, was erroneously FERS
covered.
(b) Uncorrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error has not been corrected before the
effective date of the regulations described in paragraph (2).
(2) Coverage.--
(A) Election.--
(i) In general.--Upon written notice of a retirement
coverage error, an individual may elect to remain FERS
covered or to be Social Security-Only covered, CSRS covered,
or CSRS-Offset covered, as would have applied in the absence
of the erroneous retirement coverage determination, effective
as of the date of the retirement coverage error. Such
election shall be made not later than 180 days after the date
of receipt of such notice.
(ii) Treatment of fers election.--An election of FERS
coverage under this subsection is deemed to be an election
under section 301 of the Federal Employees Retirement System
Act of 1986 (5 U.S.C. 8331 note; Public Law 99-335; 100 Stat.
599).
(B) Nonelection.--If the individual does not make an
election before the date provided under subparagraph (A), the
individual shall remain FERS covered, effective as of the
date of the retirement coverage error.
(3) Employee contributions in thrift savings fund.--If
under this section, an individual elects to be Social
Security-Only covered, CSRS covered, or CSRS-Offset covered,
all employee contributions to the Thrift Savings Fund made
during the period of erroneous FERS coverage (and all
earnings on such contributions) may remain in the Thrift
Savings Fund in accordance with regulations prescribed by the
Executive Director, notwithstanding any limit under section
8351 or 8432 of title 5, United States Code.
(4) Regulations.--Except as provided under paragraph (3),
the Office shall prescribe regulations to carry out this
subsection.
(c) Corrected Error.--
(1) Applicability.--This subsection applies if the
retirement coverage error was corrected before the effective
date of the regulations described under paragraph (2).
(2) Election.--Not later than 180 days after the date of
enactment of this Act, the Office shall prescribe regulations
authorizing individuals to elect, during the 18-month period
immediately following the effective date of such regulations
to remain Social Security-Only covered, CSRS covered, or
CSRS-Offset covered, or to be FERS covered, effective as of
the date of the retirement coverage error.
(3) Nonelection.--If an eligible individual does not make
an election under paragraph (2), the corrective action taken
before the end of any time limitation under this subsection
shall remain in effect.
(4) Treatment of fers election.--An election of FERS
coverage under this subsection is deemed to be an election
under section 301 of the Federal Employees Retirement System
Act of 1986 (5 U.S.C. 8331 note; Public Law 99-335; 100 Stat.
599).

SEC. 2132. FERS-ELIGIBLE EMPLOYEE WHO SHOULD HAVE BEEN CSRS
COVERED, CSRS-OFFSET COVERED, OR SOCIAL
SECURITY-ONLY COVERED, BUT WHO WAS ERRONEOUSLY
FERS COVERED INSTEAD WITHOUT AN ELECTION.

(a) In General.--
(1) FERS election prevented.--If an individual was
prevented from electing FERS coverage because the individual
was erroneously FERS covered during the period when the
individual was eligible to elect FERS under title III of the
Federal Employees Retirement System Act or the Federal
Employees' Retirement System Open Enrollment Act of 1997
(Public Law 105-61; 111 Stat. 1318 et seq.), the individual--
(A) is deemed to have elected FERS coverage; and
(B) shall remain covered by FERS, unless the individual
declines, under regulations prescribed by the Office, to be
FERS covered.
(2) Declining fers coverage.--If an individual described
under paragraph (1)(B) declines to be FERS covered, such
individual shall be CSRS covered, CSRS-Offset covered, or
Social Security-Only covered, as would apply in the absence
of a FERS election, effective as of the date of the erroneous
retirement coverage determination.
(b) Employee Contributions in Thrift Savings Fund.--If
under this section, an individual declines to be FERS covered
and instead is Social Security-Only covered, CSRS covered, or
CSRS-Offset covered, as would apply in the absence of a FERS
election, all employee contributions to the Thrift Savings
Fund made during the period of erroneous FERS coverage (and
all earnings on such contributions) may remain in the Thrift
Savings Fund in accordance with regulations prescribed by the
Executive Director, notwithstanding any limit that would
otherwise be applicable.
(c) Inapplicability of Duration of Erroneous Coverage.--
This section shall apply regardless of the length of time the
erroneous coverage determination remained in effect.

SEC. 2133. RETROACTIVE EFFECT.

This chapter shall be effective as of January 1, 1987,
except that section 2132 shall not apply to individuals who
made or were deemed to have made elections similar to those
provided in this section under regulations prescribed by the
Office before the effective date of this title.

CHAPTER 5--EMPLOYEE WHO SHOULD HAVE BEEN CSRS-OFFSET COVERED, BUT WHO
WAS ERRONEOUSLY CSRS COVERED INSTEAD

SEC. 2141. APPLICABILITY.

This chapter shall apply in the case of any employee who
should be (or should have been) CSRS-Offset covered but, as a
result of a retirement coverage error, is (or was) CSRS
covered instead.

SEC. 2142. CORRECTION MANDATORY.

(a) Uncorrected Error.--If the retirement coverage error
has not been corrected, as soon as practicable after
discovery of the error, such individual shall be covered
under the correct retirement coverage, effective as of the
date of the retirement coverage error.
(b) Corrected Error.--If the retirement coverage error has
been corrected before the effective date of this title, the
corrective action taken before such date shall remain in
effect.

CHAPTER 6--EMPLOYEE WHO SHOULD HAVE BEEN CSRS COVERED, BUT WHO WAS
ERRONEOUSLY CSRS-OFFSET COVERED INSTEAD

SEC. 2151. APPLICABILITY.

This chapter shall apply in the case of any employee who
should be (or should have been) CSRS covered but, as a result
of a retirement coverage error, is (or was) CSRS-Offset
covered instead.

SEC. 2152. CORRECTION MANDATORY.

(a) Uncorrected Error.--If the retirement coverage error
has not been corrected, as soon as practicable after
discovery of the error, such individual shall be covered
under the correct retirement coverage, effective as of the
date of the retirement coverage error.
(b) Corrected Error.--If the retirement coverage error has
been corrected before the effective date of this title, the
corrective action taken before such date shall remain in
effect.

[[Page H7186]]

Subtitle B--General Provisions

SEC. 2201. IDENTIFICATION AND NOTIFICATION REQUIREMENTS.

Government agencies shall take all such measures as may be
reasonable and appropriate to promptly identify and notify
individuals who are (or have been) affected by a retirement
coverage error of their rights under this title.

SEC. 2202. INFORMATION TO BE FURNISHED TO AND BY AUTHORITIES
ADMINISTERING THIS TITLE.

(a) Applicability.--The authorities identified in this
subsection are--
(1) the Director of the Office of Personnel Management;
(2) the Commissioner of Social Security; and
(3) the Executive Director of the Federal Retirement Thrift
Investment Board.
(b) Authority To Obtain Information.--Each authority
identified in subsection (a) may secure directly from any
department or agency of the United States information
necessary to enable such authority to carry out its
responsibilities under this title. Upon request of the
authority involved, the head of the department or agency
involved shall furnish that information to the requesting
authority.
(c) Authority To Provide Information.--Each authority
identified in subsection (a) may provide directly to any
department or agency of the United States all information
such authority believes necessary to enable the department or
agency to carry out its responsibilities under this title.
(d) Limitation; Safeguards.--Each of the respective
authorities under subsection (a) shall--
(1) request or provide only such information as that
authority considers necessary; and
(2) establish, by regulation or otherwise, appropriate
safeguards to ensure that any information obtained under this
section shall be used only for the purpose authorized.

SEC. 2203. SERVICE CREDIT DEPOSITS.

(a) CSRS Deposit.--In the case of a retirement coverage
error in which--
(1) a FERS covered employee was erroneously CSRS covered or
CSRS-Offset covered;
(2) the employee made a service credit deposit under the
CSRS rules; and
(3) there is a subsequent retroactive change to FERS
coverage;

the excess of the amount of the CSRS civilian or military
service credit deposit over the FERS civilian or military
service credit deposit, together with interest computed in
accordance with paragraphs (2) and (3) of section 8334(e) of
title 5, United States Code, and regulations prescribed by
the Office, shall be paid to the employee, the annuitant or,
in the case of a deceased employee, to the individual
entitled to lump-sum benefits under section 8424(d) of title
5, United States Code.
(b) FERS Deposit.--
(1) Applicability.--This subsection applies in the case of
an erroneous retirement coverage determination in which--
(A) the employee owed a service credit deposit under
section 8411(f) of title 5, United States Code; and
(B)(i) there is a subsequent retroactive change to CSRS or
CSRS-Offset coverage; or
(ii) the service becomes creditable under chapter 83 of
title 5, United States Code.
(2) Reduced annuity.--
(A) In general.--If at the time of commencement of an
annuity there is remaining unpaid CSRS civilian or military
service credit deposit for service described under paragraph
(1), the annuity shall be reduced based upon the amount
unpaid together with interest computed in accordance with
section 8334(e) (2) and (3) of title 5, United States Code,
and regulations prescribed by the Office.
(B) Amount.--The reduced annuity to which the individual is
entitled shall be equal to an amount that, when taken
together with the amount referred to under subparagraph (A),
would result in the present value of the total being
actuarially equivalent to the present value of the unreduced
annuity benefit that would have been provided the individual.
(3) Survivor annuity.--
(A) In general.--If at the time of commencement of a
survivor annuity, there is remaining unpaid any CSRS service
credit deposit described under paragraph (1), and there has
been no actuarial reduction in an annuity under paragraph
(2), the survivor annuity shall be reduced based upon the
amount unpaid together with interest computed in accordance
with section 8334(e) (2) and (3) of title 5, United States
Code, and regulations prescribed by the Office.
(B) Amount.--The reduced survivor annuity to which the
individual is entitled shall be equal to an amount that, when
taken together with the amount referred to under subparagraph
(A), would result in the present value of the total being
actuarially equivalent to the present value of an unreduced
survivor annuity benefit that would have been provided the
individual.

SEC. 2204. PROVISIONS RELATED TO SOCIAL SECURITY COVERAGE OF
MISCLASSIFIED EMPLOYEES.

(a) Definitions.--In this section, the term--
(1) ``covered individual'' means any employee, former
employee, or annuitant who--
(A) is or was employed erroneously subject to CSRS coverage
as a result of a retirement coverage error; and
(B) is or was retroactively converted to CSRS-offset
coverage, FERS coverage, or Social Security-only coverage;
and
(2) ``excess CSRS deduction amount'' means an amount equal
to the difference between the CSRS deductions withheld and
the CSRS-Offset or FERS deductions, if any, due with respect
to a covered individual during the entire period the
individual was erroneously subject to CSRS coverage as a
result of a retirement coverage error.
(b) Reports to Commissioner of Social Security.--
(1) In general.--In order to carry out the Commissioner of
Social Security's responsibilities under title II of the
Social Security Act, the Commissioner may request the head of
each agency that employs or employed a covered individual to
report (in coordination with the Office of Personnel
Management) in such form and within such timeframe as the
Commissioner may specify, any or all of--
(A) the total wages (as defined in section 3121(a) of the
Internal Revenue Code of 1986) paid to such individual during
each year of the entire period of the erroneous CSRS
coverage; and
(B) such additional information as the Commissioner may
require for the purpose of carrying out the Commissioner's
responsibilities under title II of the Social Security Act
(42 U.S.C. 401 et seq.).
(2) Compliance.--The head of an agency or the Office shall
comply with a request from the Commissioner under paragraph
(1).
(3) Wages.--For purposes of section 201 of the Social
Security Act (42 U.S.C. 401), wages reported under this
subsection shall be deemed to be wages reported to the
Secretary of the Treasury or the Secretary's delegates
pursuant to subtitle F of the Internal Revenue Code of 1986.
(c) Payment Relating to OASDI Employee Taxes.--
(1) In general.--The Office shall transfer from the Civil
Service Retirement and Disability Fund to the General Fund of
the Treasury an amount equal to the lesser of the excess CSRS
deduction amount or the OASDI taxes due for covered
individuals (as adjusted by amounts transferred relating to
applicable OASDI employee taxes as a result of corrections
made, including corrections made before the date of enactment
of this Act). If the excess CSRS deductions exceed the OASDI
taxes, any difference shall be paid to the covered individual
or survivors, as appropriate.
(2) Transfer.--Amounts transferred under this subsection
shall be determined notwithstanding any limitation under
section 6501 of the Internal Revenue Code of 1986.
(d) Payment of OASDI Employer Taxes.--
(1) In general.--Each employing agency shall pay an amount
equal to the OASDI employer taxes owed with respect to
covered individuals during the applicable period of erroneous
coverage (as adjusted by amounts transferred for the payment
of such taxes as a result of corrections made, including
corrections made before the date of enactment of this Act).
(2) Payment.--Amounts paid under this subsection shall be
determined subject to any limitation under section 6501 of
the Internal Revenue Code of 1986.
(e) Application of OASDI Tax Provisions of the Internal
Revenue Code of 1986 to Affected Individuals and Employing
Agencies.--A covered individual and the individual's
employing agency shall be deemed to have fully satisfied in a
timely manner their responsibilities with respect to the
taxes imposed by sections 3101(a), 3102(a), and 3111(a) of
the Internal Revenue Code of 1986 on the wages paid by the
employing agency to such individual during the entire period
such individual was erroneously subject to CSRS coverage as a
result of a retirement coverage error based on the payments
and transfers made under subsections (c) and (d). No credit
or refund of taxes on such wages shall be allowed as a result
of this subsection.

SEC. 2205. THRIFT SAVINGS PLAN TREATMENT FOR CERTAIN
INDIVIDUALS.

(a) Applicability.--This section applies to an individual
who--
(1) is eligible to make an election of coverage under
section 2101 or 2102, and only if FERS coverage is elected
(or remains in effect) for the employee involved; or
(2) is described in section 2111, and makes or has made
retroactive employee contributions to the Thrift Savings Fund
under regulations prescribed by the Executive Director.
(b) Payment Into Thrift Savings Fund.--
(1) In general.--
(A) Payment.--With respect to an individual to whom this
section applies, the employing agency shall pay to the Thrift
Savings Fund under subchapter III of chapter 84 of title 5,
United States Code, for credit to the account of the employee
involved, an amount equal to the earnings which are
disallowed under section 8432a(a)(2) of such title on the
employee's retroactive contributions to such Fund.
(B) Amount.--Earnings under subparagraph (A) shall be
computed in accordance with the procedures for computing lost
earnings under section 8432a of title 5, United States Code.
The amount paid by the employing agency shall be treated for
all purposes as if that amount had actually been earned on
the basis of the employee's contributions.
(C) Exceptions.--If an individual made retroactive
contributions before the effective date of the regulations
under section 2101(c), the Director may provide for an
alternative calculation of lost earnings to the extent that a
calculation under subparagraph (B) is not administratively
feasible. The alternative calculation shall yield an amount
that is as close as practicable to the amount computed under
subparagraph (B), taking into account earnings previously
paid.
(2) Additional employee contribution.--In cases in which
the retirement coverage error was corrected before the
effective date of the regulations under section 2101(c), the
employee involved shall have an additional opportunity to
make retroactive contributions for the period of the
retirement coverage error (subject to applicable limits), and
such contributions (including any contributions made after
the date of the correction) shall be treated in accordance
with paragraph (1).
(c) Regulations.--
(1) Executive director.--The Executive Director shall
prescribe regulations appropriate to

[[Page H7187]]

carry out this section relating to retroactive employee
contributions and payments made on or after the effective
date of the regulations under section 2101(c).
(2) Office.--The Office, in consultation with the Federal
Retirement Thrift Investment Board, shall prescribe
regulations appropriate to carry out this section relating to
the calculation of lost earnings on retroactive employee
contributions made before the effective date of the
regulations under section 2101(c).

SEC. 2206. CERTAIN AGENCY AMOUNTS TO BE PAID INTO OR REMAIN
IN THE CSRDF.

(a) Certain Excess Agency Contributions To Remain in the
CSRDF.--
(1) In general.--Any amount described under paragraph (2)
shall--
(A) remain in the CSRDF; and
(B) may not be paid or credited to an agency.
(2) Amounts.--Paragraph (1) refers to any amount of
contributions made by an agency under section 8423 of title
5, United States Code, on behalf of any employee, former
employee, or annuitant (or survivor of such employee, former
employee, or annuitant) who makes an election to correct a
retirement coverage error under this title, that the Office
determines to be excess as a result of such election.
(b) Additional Employee Retirement Deductions To Be Paid by
Agency.--If a correction in a retirement coverage error
results in an increase in employee deductions under section
8334 or 8422 of title 5, United States Code, that cannot be
fully paid by a reallocation of otherwise available amounts
previously deducted from the employee's pay as employment
taxes or retirement deductions, the employing agency--
(1) shall pay the required additional amount into the
CSRDF; and
(2) shall not seek repayment of that amount from the
employee, former employee, annuitant, or survivor.

SEC. 2207. CSRS COVERAGE DETERMINATIONS TO BE APPROVED BY
OPM.

No agency shall place an individual under CSRS coverage
unless--
(1) the individual has been employed with CSRS coverage
within the preceding 365 days; or
(2) the Office has agreed in writing that the agency's
coverage determination is correct.

SEC. 2208. DISCRETIONARY ACTIONS BY DIRECTOR.

(a) In General.--The Director of the Office of Personnel
Management may--
(1) extend the deadlines for making elections under this
title in circumstances involving an individual's inability to
make a timely election due to a cause beyond the individual's
control;
(2) provide for the reimbursement of necessary and
reasonable expenses incurred by an individual with respect to
settlement of a claim for losses resulting from a retirement
coverage error, including attorney's fees, court costs, and
other actual expenses;
(3) compensate an individual for monetary losses that are a
direct and proximate result of a retirement coverage error,
excluding claimed losses relating to forgone contributions
and earnings under the Thrift Savings Plan under subchapter
III of chapter 84 of title 5, United States Code, and all
other investment opportunities; and
(4) waive payments required due to correction of a
retirement coverage error under this title.
(b) Similar Actions.--In exercising the authority under
this section, the Director shall, to the extent practicable,
provide for similar actions in situations involving similar
circumstances.
(c) Judicial Review.--Actions taken under this section are
final and conclusive, and are not subject to administrative
or judicial review.
(d) Regulations.--The Office of Personnel Management shall
prescribe regulations regarding the process and criteria used
in exercising the authority under this section.
(e) Report.--The Office of Personnel Management shall, not
later than 180 days after the date of enactment of this Act,
and annually thereafter for each year in which the authority
provided in this section is used, submit a report to each
House of Congress on the operation of this section.

SEC. 2209. REGULATIONS.

(a) In General.--In addition to the regulations
specifically authorized in this title, the Office may
prescribe such other regulations as are necessary for the
administration of this title.
(b) Former Spouse.--The regulations prescribed under this
title shall provide for protection of the rights of a former
spouse with entitlement to an apportionment of benefits or to
survivor benefits based on the service of the employee.

Subtitle C--Other Provisions

SEC. 2301. PROVISIONS TO AUTHORIZE CONTINUED CONFORMITY OF
OTHER FEDERAL RETIREMENT SYSTEMS.

(a) Foreign Service.--Sections 827 and 851 of the Foreign
Service Act of 1980 (22 U.S.C. 4067 and 4071) shall apply
with respect to this title in the same manner as if this
title were part of--
(1) the Civil Service Retirement System, to the extent this
title relates to the Civil Service Retirement System; and
(2) the Federal Employees' Retirement System, to the extent
this title relates to the Federal Employees' Retirement
System.
(b) Central Intelligence Agency.--Sections 292 and 301 of
the Central Intelligence Agency Retirement Act (50 U.S.C.
2141 and 2151) shall apply with respect to this title in the
same manner as if this title were part of--
(1) the Civil Service Retirement System, to the extent this
title relates to the Civil Service Retirement System; and
(2) the Federal Employees' Retirement System, to the extent
this title relates to the Federal Employees' Retirement
System.

SEC. 2302. AUTHORIZATION OF PAYMENTS.

All payments authorized or required by this title to be
paid from the Civil Service Retirement and Disability Fund,
together with administrative expenses incurred by the Office
in administering this title, shall be deemed to have been
authorized to be paid from that Fund, which is appropriated
for the payment thereof.

SEC. 2303. INDIVIDUAL RIGHT OF ACTION PRESERVED FOR AMOUNTS
NOT OTHERWISE PROVIDED FOR UNDER THIS TITLE.

Nothing in this title shall preclude an individual from
bringing a claim against the Government of the United States
which such individual may have under section 1346(b) or
chapter 171 of title 28, United States Code, or any other
provision of law (except to the extent the claim is for any
amounts otherwise provided for under this title).

Subtitle D--Effective Date

SEC. 2401. EFFECTIVE DATE.

Except as otherwise provided in this title, this title
shall take effect on the date of enactment of this Act.

Amend the title so as to read: ``An Act to amend title 5,
United States Code, to provide for the establishment of a
program under which long-term care insurance is made
available to Federal employees, members of the uniformed
services, and civilian and military retirees, provide for the
correction of retirement coverage errors under chapters 83
and 84 of such title, and for other purposes.''.
____

House amendments to Senate amendments:
Page 2, line 7, strike ``and''.
Page 2, line 9, strike the comma and insert ``; and''.
Page 2, after line 9, insert the following:
``(C) an individual employed by the Tennessee Valley
Authority,
Page 29, line 18, insert ``under title 5, United States
Code,'' after ``limit''.
Page 42, line 1, insert ``under title 5, United States
Code,'' after ``limit''.
Page 50, strike line 3 and all that follows through
``Office'' in line 5, and insert the following:
(c) Payment Relating to OASDI Employee Taxes.--The Office

(and run-in the remaining text of paragraph (1)).
Page 50, strike lines 16 through 19.
Page 51, strike lines 7 through 19.

Mr. SCARBOROUGH (during the reading). Mr. Speaker, I ask unanimous
consent that the amendments be considered as read and printed in the
Record.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Florida?
There was no objection.
The SPEAKER pro tempore. Is there objection to the original request
of the gentleman from Florida?
Mr. CUMMINGS. Mr. Speaker, reserving the right to object, today is a
cause for celebration. H.R. 4040 is a testament to how good process can
lead to good results for the people we serve.

{time} 1800

Commitment, bipartisanship and hard work on the part of the gentleman
from Florida (Mr. Scarborough), the gentleman from California (Mr.
Waxman), the gentlewoman from the District of Columbia (Ms. Norton),
the gentleman from Maine (Mr. Allen) and the gentlewoman from Maryland
(Mrs. Morella), our congressional staff, the Office of Personnel
Management, and the long-term care industry culminated in H.R. 4040,
the Long-term Care Security Act.
I am pleased that the framework proposed in H.R. 110, my long-term
care proposal, allowing OPM to contract with a single carrier or
consortia to provide long-term care insurance to Federal employees in
permitting OPM to negotiate premiums and benefits on behalf of Federal
employees is adopted in H.R. 4040.
This employer group model will allow Federal employees to realize
from 15 percent to 20 percent in premium savings. In addition to
establishing a program to provide long-term care insurance to Federal
employees and military personnel, the Senate amended H.R. 4044 with the
text of S. 2420, which included the Federal Erroneous Retirement
Coverage Corrections Act.
S. 2420 provides relief to those Federal employees who were placed in
the wrong retirement system during transition to the Federal employment
retirement system from the civil service retirement system during the
1980s. Under current law, Federal agencies are required to correct a
retirement coverage error by forcing the affected employers into FERS.
The Federal Erroneous Coverage Corrections Act will permit the
employees who had been victims of an enrollment error to remain in the
retirement system they were erroneously placed in.

[[Page H7188]]

CSRS ought to be covered by the system they should have been in, in
most cases FERS.
Unlike the House retirement corrections bill, if the employee chooses
to be placed in FERS, he or she will be responsible for the lost
contributions to his or her thrift savings account. The House bill
sought to achieve accountability by holding those agencies guilty of
making enrollment errors responsible for the lost contributions to the
employee's TSP account.
Mr. Speaker, though we would have preferred the House bill, we worked
with the Senate to reach consensus on a bill that would result in some,
if not optimal relief for employees placed in the wrong retirement
system. H.R. 4040 is a lesson in how the legislative process through
bipartisanship and compromise can work to better the lives of the
American people. I enthusiastically support this legislation and urge
my colleagues to do the same.
Mr. Speaker, I withdraw my reservation of objection.
The SPEAKER pro tempore (Mr. Pease). Is there objection to the
initial request of the gentleman from Florida?
Mrs. MORELLA. Mr. Speaker, reserving the right to object, I do not
object, but I do want to celebrate this time when we in this House
accept this bill, H.R. 4040, as amended, and send it back for the
clarification from the Senate. This long-term care insurance bill has
taken a lot of time. It has been long term, but it has been worth it.
I introduced legislation; my colleagues introduced legislation. We
all worked together on it. The legislation I introduced was H.R. 1111,
and it included not only Federal employees and annuitants, but it
included also the military employees and retirees, which made the pool
20 million, which will allow OPM, the Office of Personnel Management,
to be able to negotiate to get the very best plan that will have
consumer protections and will also have choices within it.
Mr. Speaker, a lot of groups helped out with it, my colleagues; the
gentleman from Florida (Mr. Scarborough), who chaired the committee;
the gentleman from Maryland (Mr. Cummings), the ranking member; others
on the committee worked on it also, as well as organizations, like the
National Association of Retired Federal Employees, the Postal Workers,
Alzheimer's, retired military, and OPM was engaged also in the process,
so all of us will be able to gain from this, the United States will be
able to gain from it.
We hope that the premiums would be reduced 15 percent to 20 percent,
and people will be able to plan for their futures through this bill. So
I urge this bill's approval as amended, H.R. 4040.
Mr. SCARBOROUGH. Mr. Speaker, will the gentlewoman yield?
Mrs. MORELLA. I yield to the gentleman from Florida.
Mr. SCARBOROUGH. Mr. Speaker, I thank the gentlewoman from Maryland
(Mrs. Morella) and also certainly thank the gentleman from Maryland
(Mr. Cummings), the ranking member of the committee, he and the
gentlewoman from Maryland have both worked diligently on their own
versions of this bill, both believed very much that their versions were
the best versions of the bill, as did I on mine. Both of them worked
around the clock.
The great thing is, I think we have got the best of all worlds from
every bill. And I know there are so many people in my district that
have a better long-term health care insurance plan because of what the
gentleman from Maryland (Mr. Cummings) did, and obviously because of
what the gentlewoman from Maryland (Mrs. Morella) did.
I have so many Federal retirees, military retirees, in my district
that are grateful for the hard work they have done, work they did
before I even became chairman of this committee, the work that the
gentleman from Florida (Mr. Mica) did. The gentleman from Indiana
(Chairman Burton) certainly helped; the gentleman from California (Mr.
Waxman), the ranking member, helped a great deal; the gentleman from
Virginia (Mr. Davis); the gentleman from Texas (Chairman Archer).
I would also like to thank our staffs that worked for a very, very
long time on this bill, on my staff in particular, Gary Ewing and
Jennifer Hemingway, but it is going to help everybody.
Long-term care security is a consensus bill. It is reflective of the
hard work of Members on both sides of the aisle, and it is going to
provide really assurance to Federal employees and retirees and military
retirees, and so many others that they are going to be taken care of,
and they are going to be able to get long-term health care insurance.
It is important for all us.
The Senate language on long-term care is identical to the language
that the House passed just last May. The bill also contains provisions
to correct a long-standing inequity for Federal employees who, through
no fault of their own, were erroneously placed in the wrong retirement
system.
The amendments make several technical changes to the retirement
corrections portion of this bill. And, in addition, in consultation,
with Senator Thompson, I am pleased to include employees of the
Tennessee Valley Authority, among the list of those eligible to
purchase long-term care insurance. It is not only good for them, it is
not only good for Federal employees that work here and throughout
Washington, the country, it is good for all of America.
Mr. Speaker, I am confident that this bill is going to be landmark
legislation that the private sector will be able to follow and we will
be able to provide long-term health care to all Americans.
Mr. Speaker, I urge Members to support H.R. 4040, as amended.
Mrs. MORELLA. Mr. Speaker, I withdraw my reservation of objection.
The SPEAKER pro tempore. Is there objection to the initial request of
the gentleman from Florida?
There was no objection.
A motion to reconsider was laid on the table.

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