[Federal Register Volume 67, Number 117 (Tuesday, June 18, 2002)]
[Rules and Regulations]
[Pages 41305-41307]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-15275]



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 Rules and Regulations
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  Federal Register / Vol. 67, No. 117 / Tuesday, June 18, 2002 / Rules 
and Regulations  

[[Page 41305]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 890

RIN 3206-AJ36


Suspension of CHAMPVA or TRICARE or TRICARE-for-Life Eligibles' 
Enrollment in the Federal Employees Health Benefits (FEHB) Program

AGENCY: Office of Personnel Management.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management is issuing a final rule to 
allow CHAMPVA or TRICARE or TRICARE-for-Life eligible FEHB Program 
annuitants, survivors, and former spouses to suspend their FEHB 
enrollments, and then return to the FEHB Program during the Open 
Season, or return to FEHB coverage immediately, if they involuntarily 
lose CHAMPVA or TRICARE or TRICARE-for-Life coverage. The intent of 
this rule is to allow these beneficiaries to avoid the expense of 
continuing to pay FEHB Program premiums while they are using TRICARE or 
TRICARE-for-Life or CHAMPVA coverage, without endangering their ability 
to return to the FEHB Program in the future.

EFFECTIVE DATE: Effective July 18, 2002.

FOR FURTHER INFORMATION CONTACT: Michael W. Kaszynski, Policy Analyst, 
Insurance Policy and Information Division, OPM, Room 3425, 1900 E 
Street, NW., Washington, DC 20415-0001. Phone: (202) 606-0004.

SUPPLEMENTARY INFORMATION: Effective October 1, 2001, the National 
Defense Authorization Act for 2001 reinstated TRICARE coverage for 
Medicare-eligible uniformed services retirees, their survivors and 
eligible dependents under the new TRICARE-for-Life program. TRICARE or 
TRICARE-for-Life coverage can be advantageous to many uniformed 
services beneficiaries who now are covered under the FEHB Program as 
Federal civilian annuitants, survivors, or former spouses.
    Also, recent legislation, Public Law 107-14, provides beneficiaries 
over age 65 of the Department of Veterans Affairs (VA) with coverage 
secondary to Medicare under the Civilian Health and Medical Program of 
the Department of Veterans Affairs (CHAMPVA). CHAMPVA provides 
similarly attractive benefits to VA eligible beneficiaries as those 
benefits provided to uniformed services beneficiaries under the TRICARE 
or new TRICARE-for-Life programs.
    Under previous FEHB regulations, however, an annuitant, survivor, 
or former spouse who canceled his or her FEHB coverage to use CHAMPVA 
or TRICARE would not be allowed to return to FEHB coverage. Therefore, 
OPM is issuing these final regulations to allow these FEHB participants 
to suspend, rather than cancel, their FEHB coverage to use CHAMPVA or 
TRICARE or the new TRICARE-for-Life coverage. Under this rule, eligible 
individuals are allowed to return to FEHB coverage immediately if they 
involuntarily lose CHAMPVA or TRICARE or TRICARE-for-Life coverage or 
during a future FEHB Open Season.
    We are also amending our regulations to clarify a similar situation 
involving FEHB-covered annuitants, survivors, and former spouses. The 
regulations allow an individual who drops FEHB coverage when he or she 
enrolls in a Medicare-sponsored plan, or in Medicaid or a similar 
State-sponsored program of medical assistance for the needy, to return 
to FEHB coverage during the annual Open Season or immediately upon 
being involuntarily disenrolled from the non-FEHB coverage.
    On September 26, 2001, OPM published an interim regulation in the 
Federal Register (66 FR 49086). OPM received comments from a number of 
individuals as well as the Department of Veterans Affairs on the 
regulation. Three commenters were not sure if the regulation allowed 
surviving spouses of Federal annuitants to suspend their FEHB coverage 
to use TRICARE or TRICARE-for-Life. One commenter also wanted to know 
if a surviving spouse could reenroll in the FEHB Program if the 
annuitant passed away during the suspension period. The regulation 
authorizes a surviving spouse, who is eligible for health benefits 
coverage as a survivor annuitant, to suspend FEHB coverage while 
maintaining the right to reenroll in the future. In order to qualify 
for health benefit coverage as a survivor annuitant, a surviving spouse 
must have been enrolled as a family member under the annuitant's Self 
and Family enrollment and qualify to receive a portion of the 
annuitant's annuity upon his/her death. The regulation also allows 
individuals who become survivor annuitants during a period of suspended 
FEHB coverage to reenroll even though the survivor didn't make the 
original decision to suspend coverage. The survivor must have been 
enrolled under the annuitant's Self and Family coverage immediately 
preceding the annuitant's suspension of FEHB coverage and otherwise 
qualify as a survivor annuitant.
    We received a comment from the VA stating that CHAMPVA provides the 
same or similar benefits to VA eligible beneficiaries as those benefits 
provided to TRICARE beneficiaries. Because of this, the VA believes 
that individuals eligible for CHAMPVA should be permitted to suspend 
FEHB coverage under the same conditions as those individuals eligible 
for TRICARE or TRICARE-for-Life. We agree with the VA and have revised 
the regulation to allow annuitants, survivors, and former spouses to 
suspend FEHB coverage with the right to reenroll in the future.
    One commenter requested that we make the regulation retroactive to 
the effective date of the TRICARE-for-Life legislation. The commenter 
stated that many eligible individuals canceled rather than suspended 
their FEHB enrollments because that was the only option available at 
the time. The actual date that the new TRICARE-for-Life program became 
effective for medical, hospital, and surgical coverage was October 1, 
2001. Our interim regulation was published and effective on September 
26, 2001. Therefore, the authority to suspend, rather than cancel, was 
available to annuitants and former spouses on the effective date of 
TRICARE-for-Life coverage. We see no need to make further changes to 
the regulation's effective date.
    One commenter requested that OPM give spouses of living civilian 
annuitants the opportunity to enroll in

[[Page 41306]]

Self-Only coverage under the FEHB Program while allowing annuitants the 
opportunity to suspend FEHB coverage for TRICARE or TRICARE-for-Life. 
Another commenter requested that OPM give spouses of living annuitants 
the opportunity to suspend their FEHB enrollment with the right to 
reenroll in the FEHB Program in the future. Existing FEHB law does not 
authorize spouses of living employees or annuitants to enroll in the 
FEHB Program on their own behalf. Therefore, we cannot create this 
authority through regulation.
    One commenter asked if active civil service employees could suspend 
their FEHB coverage to use TRICARE or TRICARE-for-Life. The regulation 
does not allow employees to suspend their coverage. This is because 
employees have always had the option of canceling their coverage with 
the right to reenroll in the FEHB Program during a future Open Season, 
or immediately if they involuntarily lose TRICARE coverage. In the 
past, annuitants, survivors, and former spouses never had the option to 
reenroll in the FEHB Program after leaving for TRICARE. Our new 
regulation creates this authority.
    We have clarified the period for submitting suspension 
documentation to OPM and the effective date of suspensions. In the case 
of an involuntary disenrollment from non-FEHB coverage, if an eligible 
individual does not request to reenroll in the FEHB Program within the 
time period specified by the regulation, he or she must wait until the 
next Open Season to reenroll.

Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic 
impact on a substantial number of small entities because the regulation 
only affects health insurance carriers under the Federal Employees 
Health Benefits Program.

Executive Order 12866, Regulatory Review

    This regulation has been reviewed by the Office of Management and 
Budget in accordance with Executive Order 12866.

List of Subjects in 5 CFR Part 890

    Administrative practice and procedure, Government employees, Health 
facilities, Health insurance, Health professionals, Hostages, Iraq, 
Kuwait, Lebanon, Reporting and record keeping requirements, Retirement.

U.S. Office of Personnel Management.
Kay Coles James,
Director.


    For the reasons set forth in the preamble, OPM is amending 5 CFR 
Part 890 as follows:

PART 890--FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM

    1. The authority citation for Part 890 continues to read as 
follows:

    Authority: 5 U.S.C. 8913; Sec. 890.803 also issued under 50 
U.S.C. 403p, 22 U.S.C. 4069c and 4069c-1; subpart L also issued 
under sec. 599C of Pub. L. 101-513, 104 Stat. 2064, as amended; 
Sec. 890.102 also issued under sections 11202(f), 11232(e), 11246 
(b) and (c) of Pub. L. 105-33, 111 Stat. 251; and section 721 of 
Pub. L. 105-261, 112 Stat. 2061.


    2. The section heading in Sec. 890.304 and paragraph (d)(2) are 
revised to read as follows:


Sec. 890.304  When do enrollments terminate, cancel or suspend?

* * * * *
    (d) * * *
    (2) An annuitant or survivor annuitant may suspend enrollment in 
FEHB for the purpose of enrolling in a Medicare-sponsored plan under 
sections 1833, 1876, or 1851 of the Social Security Act, or to enroll 
in the Medicaid program or a similar State-sponsored program of medical 
assistance for the needy, or to use CHAMPVA or TRICARE (including 
coverage provided by the Uniformed Services Family Health Plan) or 
TRICARE-for-Life instead of FEHB coverage. To suspend FEHB coverage, 
documentation of eligibility for coverage under the non-FEHB program 
must be submitted to the retirement system. If the documentation is 
received within the period beginning 31 days before and ending 31 days 
after the effective date of the enrollment in the Medicare-sponsored 
plan, or the Medicaid or similar program, or within 31 days before or 
after the day designated by the annuitant or survivor annuitant as the 
day he or she wants to suspend FEHB coverage to use CHAMPVA or TRICARE 
(including the Uniformed Services Family Health Plan) or TRICARE-for-
Life instead of FEHB coverage, then suspension will be effective at the 
end of the day before the effective date of the enrollment or the end 
of the day before the day designated. Otherwise, the suspension is 
effective the first day of the first pay period that begins after the 
date the retirement system receives the documentation.
* * * * *

    3. The section heading in Sec. 890.306 and paragraph (f)(1)(ii) are 
revised, paragraphs (f)(1)(iii) and (f)(1)(iv) are removed, paragraph 
(h) is revised, and paragraph (i) is removed and reserved to read as 
follows:


Sec. 890.306  When can annuitants or survivor annuitants change 
enrollment or reenroll and what are the effective dates?

* * * * *
    (f) * * *
    (1) * * *
    (ii) An annuitant or survivor annuitant who suspended enrollment 
under this part to enroll in a Medicare-sponsored plan under sections 
1833, 1876, or 1851 of the Social Security Act, or to enroll in a 
Medicaid or similar State-sponsored program of medical assistance for 
the needy, or to use CHAMPVA or TRICARE (including the Uniformed 
Services Family Health Plan) or TRICARE-for-Life coverage instead of 
FEHB coverage, may reenroll.
* * * * *
    (h) Reenrollment of annuitants or survivor annuitants who suspended 
enrollment to enroll in a Medicare-sponsored plan, or a Medicaid or 
similar State-sponsored program; or to use CHAMPVA or TRICARE 
(including the Uniformed Services Family Health Plan) or TRICARE-for-
Life coverage instead of FEHB coverage.
    (1) An annuitant or survivor annuitant who had been enrolled (or 
was eligible to enroll) for coverage under this part and suspended the 
enrollment for the purpose of enrolling in a Medicare sponsored plan 
under sections 1833, 1876, or 1851 of the Social Security Act, or to 
enroll in the Medicaid program or a similar State-sponsored program of 
medical assistance for the needy, or to use CHAMPVA or TRICARE 
(including the Uniformed Services Family Health Plan) or TRICARE-for-
Life coverage instead of the FEHB Program (as provided by 
Sec. 890.304(d)), and who subsequently involuntarily loses coverage 
under one of these programs, may immediately reenroll in any available 
FEHB plan under this part at any time beginning 31 days before and 
ending 60 days after the loss of coverage. A reenrollment under this 
paragraph (h) of this section takes effect on the date following the 
effective date of the loss of coverage as shown on the documentation 
from the non-FEHB coverage. If the request to reenroll is not received 
by the retirement system within the time period specified, the 
annuitant must wait until the next available Open Season to reenroll.
    (2) An annuitant or survivor annuitant who suspended enrollment in 
the FEHB Program to enroll in a Medicare sponsored plan or the Medicaid 
or similar State-sponsored program of

[[Page 41307]]

medical assistance for the needy, or to use CHAMPVA or TRICARE 
(including the Uniformed Services Family Health Plan) or TRICARE-for-
Life, but now wants to reenroll in the FEHB Program for any reason 
other than an involuntary loss of coverage, may do so during the next 
available Open Season (as provided by paragraph (f) of this section).
    (i) [Reserved]
* * * * *

    4. The section heading in Sec. 890.806 and paragraphs (f)(1)(ii) 
are revised, paragraphs (f)(1)(iii) and (f)(1)(iv) are removed, 
paragraph (h) is revised, and paragraph (i) is removed and reserved to 
read as follows:


Sec. 890.806  When can former spouses change enrollment or reenroll and 
what are the effective dates?

* * * * *
    (f) * * *
    (1) * * *
    (ii) A former spouse who suspended the enrollment under this part 
for the purpose of enrolling in a Medicare sponsored plan under 
sections 1833, 1876, or 1851 of the Social Security Act, or to enroll 
in the Medicaid program or a similar State-sponsored program of medical 
assistance for the needy, or to use CHAMPVA or TRICARE (including the 
Uniformed Services Family Health Plan) or TRICARE-for-Life coverage 
instead of FEHB coverage, may reenroll.
* * * * *
    (h) Reenrollment of former spouses who suspended enrollment to 
enroll in a Medicare sponsored plan, or the Medicaid or similar State-
sponsored program, or to use CHAMPVA or TRICARE (including the 
Uniformed Services Family Health Plan) or TRICARE-for-Life coverage 
instead of FEHB coverage.
    (1) A former spouse who had been enrolled for coverage under this 
part and suspended enrollment for the purpose of enrolling in a 
Medicare sponsored plan under sections 1833, 1876, or 1851 of the 
Social Security Act, or to enroll in Medicaid or similar State-
sponsored program of medical assistance for the needy, or to use 
CHAMPVA or TRICARE (including the Uniformed Services Family Health 
Plan) or TRICARE-for-Life coverage instead of FEHB (as provided in 
Sec. 890.807(e)), or who meets the eligibility requirements of 
Sec. 890.803 and the application time limitation requirements of 
Sec. 890.805, but postponed enrollment in the FEHB Program for the 
purpose of enrolling in one of these non-FEHB programs, and who 
subsequently involuntarily loses coverage under one of these programs, 
may immediately reenroll in any available FEHB plan under this part at 
any time beginning 31 days before and ending 60 days after the loss of 
coverage. A reenrollment under this paragraph (h) of this section takes 
effect on the date following the effective date of the loss of coverage 
as shown on the documentation from the non-FEHB coverage. If the 
request to reenroll is not received by the employing office or 
retirement system within the time period specified, the former spouse 
must wait until the next available Open Season to reenroll.
    (2) A former spouse who suspended enrollment in the FEHB Program to 
enroll in a Medicare sponsored plan, or the Medicaid program or a 
similar State-sponsored program of medical assistance for the needy, or 
to use CHAMPVA or TRICARE (including the Uniformed Services Family 
Health Plan) or the TRICARE-for-Life program, but now wants to reenroll 
in the FEHB Program for any reason other than an involuntary loss of 
coverage, may do so during the next available Open Season (as provided 
by paragraph (f) of this section).
    (i) [Reserved]
* * * * *

    5. The section heading in Sec. 890.807 and paragraphs (e)(2) and 
(e)(4) are revised to read as follows:


Sec. 890.807  When do enrollments terminate, cancel or suspend?

* * * * *
    (e) * * *
    (2) A former spouse may suspend enrollment in FEHB for the purpose 
of enrolling in a Medicare sponsored plan under sections 1833, 1876, or 
1851 of the Social Security Act, or to enroll in the Medicaid program 
or a similar State-sponsored program of medical assistance for the 
needy, or to use CHAMPVA or TRICARE (including the Uniformed Services 
Family Health Plan) or TRICARE-for-Life coverage instead of FEHB 
coverage. To suspend FEHB coverage, documentation of eligibility for 
coverage under the non-FEHB Program must be submitted to the employing 
office or retirement system. If the documentation is received within 
the period beginning 31 days before and ending 31 days after the 
effective date of the enrollment in the Medicare sponsored plan, or the 
Medicaid or similar program, or within 31 days before or after the day 
designated by the former spouse as the day he or she wants to suspend 
FEHB coverage to use CHAMPVA or TRICARE (including the Uniformed 
Services Family Health Plan) or TRICARE-for-Life coverage instead of 
FEHB coverage, then the suspension will be effective at the end of the 
day before the effective date of the enrollment or the end of the day 
before the day designated. Otherwise, the suspension is effective the 
first day of the first pay period that begins after the date the 
employing office or retirement system receives the documentation.
* * * * *
    (4) A former spouse who cancels his or her enrollment for any 
reason may not later reenroll in the FEHB Program.

[FR Doc. 02-15275 Filed 6-17-02; 8:45 am]
BILLING CODE 6325-50-P