[Federal Register Volume 68, Number 190 (Wednesday, October 1, 2003)]
[Rules and Regulations]
[Pages 56523-56525]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-24792]



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 Rules and Regulations
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  Federal Register / Vol. 68, No. 190 / Wednesday, October 1, 2003 / 
Rules and Regulations  

[[Page 56523]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Parts 890 and 892

RIN 3206-AJ34


Federal Employees Health Benefits Children's Equity

AGENCY: Office of Personnel Management.

ACTION: Interim rule with request for comments.

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

SUMMARY: The Office of Personnel Management (OPM) is issuing interim 
regulations to implement the Federal Employees Health Benefits 
Children's Equity Act of 2000, which was enacted October 30, 2000. This 
law mandates the enrollment of a Federal employee for self and family 
coverage in the Federal Employees Health Benefits (FEHB) Program, if 
the employee is subject to a court or administrative order requiring 
him/her to provide health benefits for his/her child(ren) and the 
employee does not provide documentation of compliance with the order.

DATES: Interim rules are effective October 31, 2003. OPM must receive 
comments on or before December 1, 2003.

ADDRESSES: Send written comments to Abby L. Block, Senior Advisor for 
Employee and Family Support, Strategic Human Resources Policy Division, 
Office of Personnel Management, 1900 E Street NW., Washington DC 20415-
3666; or deliver to OPM, Room 3425, 1900 E Street NW., Washington, DC; 
or FAX to (202) 606-0633.

FOR FURTHER INFORMATION CONTACT: Nataya Battle (202) 606-0004.

SUPPLEMENTARY INFORMATION: On October 30, 2000, Public Law 106-394, 114 
Stat. 1629, was enacted. This law, the Federal Employees Health 
Benefits Children's Equity Act of 2000, mandates compliance with court 
or administrative orders requiring Federal employees to provide health 
benefits for their children. The law was effective upon enactment.
    Before the enactment of Public Law 106-394, a court or State 
administrative agency could issue an order for an individual to provide 
health benefits for his or her child(ren); however, there was nothing 
in the FEHB law to require compliance. While the issuance of such an 
order was an event that allowed an employee to enroll or to change from 
self only to self and family, the enrollment was voluntary on the 
employee's part.
    The law now makes compliance with the court or administrative order 
mandatory. A Federal employee subject to such an order must enroll for 
self and family coverage in a health plan that provides full benefits 
in the area where the children live or provide documentation to the 
agency that he or she has obtained other health benefits for the 
children. If the employee does not do so, the agency will enroll the 
employee involuntarily as follows: (1) If the employee has no FEHB 
coverage, the agency will enroll him or her for self and family 
coverage in the option of the Blue Cross and Blue Shield Service 
Benefit Plan that provides the lower level of coverage; (2) if the 
employee has a self only enrollment in a fee-for-service plan or in an 
HMO that serves the area where the children live, the agency will 
change his or her enrollment to self and family in the same option of 
the same plan; (3) if the employee is enrolled in an HMO that does not 
serve the area where the children live, the agency will change his or 
her enrollment to self and family in the lower option of the Blue Cross 
and Blue Shield Service Benefit Plan.
    As long as the court or administrative order is in effect, and the 
employee has at least one child identified in the order who is still 
eligible under the FEHB Program, the employee cannot cancel his or her 
enrollment, change to self only, or change to a plan that does not 
serve the area in which the child or children live, unless he or she 
provides documentation that he or she has other coverage for the 
children. If the court or administrative order is still in effect at 
the time the employee retires, and if at least one child is still 
eligible for FEHB, the employee must continue FEHB into retirement (if 
eligible) and cannot make any of these changes after retirement for as 
long as the order remains in effect and the child continues to be 
eligible under 5 U.S.C. 8901(5).
    If such an employee goes into a nonpay status, or if his or her 
salary becomes insufficient to make the premium withholdings, he or she 
cannot choose to terminate the enrollment. Instead, the employee must 
continue the coverage and either make direct premium payments or incur 
a debt to the Government. (By law, an employee's enrollment still 
terminates after 1 year in nonpay status.) If the annuity of an 
employee who remained subject to such a court or administrative order 
upon retirement becomes insufficient to make the premium withholdings, 
the annuitant cannot choose to terminate the enrollment. Instead, he or 
she must continue the coverage and make direct premium payments for as 
long as the order remains in effect and the child continues to be 
eligible under 5 U.S.C. 8901(5).

Waiver of Notice of Proposed Rulemaking

    In accordance with Sec.  553(b)(3)(B) of title 5 of the U.S. Code, 
I find that good cause exists for waiving the general notice of 
proposed rulemaking. Notice is being waived to implement currently 
effective legislation. There is an immediate need for implementation of 
an interim regulation in order to expand the processing of child 
medical support court orders for children of Federal employees who 
become annuitants. Public Law 106-394 does not address what happens to 
the child medical support court order once the employee retires. As a 
result, the children of retirees are being harmed without regulation to 
authorize OPM to enforce the court orders that began while the parent 
was an employee. Public Law 106-394 has been in effect for three years 
and any further delay in effecting this regulation would be unnecessary 
and contrary to the public interest.

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 
will only affect health benefits of certain Federal employees and 
retirees.

[[Page 56524]]

Executive Order 12866, Regulatory Review

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

List of Subjects

5 CFR Part 890

    Administrative practice and procedure, Government employees, Health 
facilities, Health insurance, Health professions, Hostages, Iraq, 
Kuwait, Lebanon, Military personnel, Reporting and recordkeeping 
requirements, Retirement.

5 CFR Part 892

    Administrative practice and procedure, Government employees, Health 
insurance, Taxes, Wages.

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

0
Accordingly, OPM is amending 5 CFR parts 890 and 892 as follows:

PART 890--FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM

0
1. The authority citation for part 890 revised to read as follows:

    Authority: 5 U.S.C. 8913; Sec.  890.303 also issued under 50 
U.S.C. 403(p), 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), and 
11246(b) and (c) of Pub. L. 105-33, 111 Stat. 251; and section 721 
of Pub. L. 105-261, 112 Stat. 2061 unless otherwise noted.


0
2. In Sec.  890.301 revise paragraphs (e)(1) and (f)(3) and add new 
paragraphs (g)(3) and (g)(4) to read as follows:


Sec.  890.301  Opportunities for employees who are not participants in 
premium conversion to enroll or change enrollment; effective dates.

* * * * *
    (e) Change to self only. (1) Subject to two exceptions, an employee 
may change the enrollment from self and family to self only at any 
time. Exceptions:
    (i) An employee participating in health insurance premium 
conversion may change to self only during an open season or because of 
and consistent with a qualifying life event as defined in Part 892 of 
this chapter.
    (ii) An employee who is subject to a court or administrative order 
as discussed in Sec.  890.301(g)(3) cannot make this change as long as 
the court or administrative order is still in effect and the employee 
has at least one child identified in the order who is still eligible 
under the FEHB Program, unless the employee provides documentation to 
the agency that he or she has other coverage for the child(ren).
* * * * *
    (f) * * *
    (3) With one exception, during an open season, an eligible employee 
may enroll and an enrolled employee may change his or her existing 
enrollment from self only to self and family, may change from one plan 
or option to another, or may make any combination of these changes. 
Exception: An employee who is subject to a court or administrative 
order as discussed in Sec.  890.301(g)(3) cannot cancel his or her 
enrollment, change to self only, or change to a comprehensive medical 
plan that does not serve the area where his or her child or children 
live as long as the court or administrative order is still in effect 
and the employee has at least one child identified in the order who is 
still eligible under the FEHB Program, unless the employee provides 
documentation to the agency that he or she has other coverage for the 
child(ren).
* * * * *
    (g) * * *
    (3)(i) If an employing office receives a court or administrative 
order on or after October 30, 2000, requiring an employee to provide 
health benefits for his or her child or children, the employing office 
will determine if the employee has a self and family enrollment in a 
health benefits plan that provides full benefits in the area where the 
child or children live. If the employee does not have the required 
enrollment, the agency must notify him or her that it has received the 
court or administrative order and give the employee until the end of 
the following pay period to change his or her enrollment or provide 
documentation to the employing office that he or she has other coverage 
for the child or children. If the employee does not comply within these 
time frames, the employing office must enroll the employee 
involuntarily as stated in paragraph (g)(3)(ii) of this section.
    (ii) If the employee is not enrolled or does not enroll, the agency 
must enroll him or her for self and family coverage in the option that 
provides the lower level of coverage in the Service Benefit Plan. If 
the employee has a self only enrollment, the employing office must 
change the enrollment to self and family in the same option and plan, 
as long as the plan provides full benefits in the area where the child 
or children live. If the employee is enrolled in a comprehensive 
medical plan that does not serve the area in which the child or 
children live, the employing office must change the enrollment to self 
and family in the option that provides the lower level of coverage in 
the Service Benefit Plan.
    (4) Subject to two exceptions, the effective date of an involuntary 
enrollment under paragraph (g)(3) of this section is the 1st day of the 
pay period that begins after the date the employing office completes 
the enrollment request. Exceptions:
    (i) If the court or administrative order requires an earlier 
effective date, the effective date will be the 1st day of the pay 
period that includes that date. Retroactive effective dates cannot be 
to a date that is more than 2 years earlier, or prior to October 30, 
2000.
    (ii) If after an involuntary enrollment becomes effective and the 
employing office finds that circumstances beyond the employee's control 
prevented him or her from enrolling or changing the enrollment within 
the time limits in this section, the employee may change the enrollment 
prospectively within 60 days after the employing office advises the 
employee of its finding.
* * * * *

0
3. In Sec.  890.304 revise paragraph (d)(1) and the section heading to 
read as follows:


Sec.  890.304  Termination of enrollment.

* * * * *
    (d) Cancellation or suspension. (1)(i) An employee who participates 
in health insurance premium conversion as provided in Part 892 of this 
chapter may cancel his or her enrollment only during an open season or 
because of and consistent with a qualifying life event defined in Sec.  
892.101 of this chapter.
    (ii) Subject to the provisions of paragraph (d)(iii) of this 
section, an enrollee who does not participate in premium conversion may 
cancel his or her enrollment at anytime by filing an appropriate 
request with the employing office. The cancellation is effective at the 
end of the last day of the pay period in which the employing office 
receives the appropriate request canceling the enrollment.
    (iii) An employee who is subject to a court or administrative order 
as discussed in Sec.  890.301(g)(3), or an annuitant who was subject to 
such a court or administrative order at the time of his or her 
retirement, cannot cancel or suspend his or her enrollment as long as 
the court or administrative order is still in effect and the enrollee 
has at least one child identified in the order who is still eligible 
under the FEHB Program, unless the employee or annuitant provides 
documentation to

[[Page 56525]]

the agency that he or she has other coverage for the child or children.
* * * * *
0
4. In Sec.  890.306 revise paragraphs (e)(1) and (f)(1)(i) to read as 
follows:


Sec.  890.306  Opportunities for annuitants to change enrollment or to 
reenroll; effective dates.

* * * * *
    (e) Enrollment change to self only. (1) With one exception, an 
annuitant may change the enrollment from self and family to self only 
at any time. Exception: An annuitant who, as an employee, was subject 
to a court or administrative order as discussed in Sec.  890.301(g)(3) 
at the time he or she retired cannot change to self only after 
retirement as long as the court or administrative order is still in 
effect and the annuitant has at least one child identified in the order 
who is still eligible under the FEHB Program, unless the annuitant 
provides documentation to the retirement system that he or she has 
other coverage for the child or children.
* * * * *
    (f) * * *
    (1) * * *
    (i) With one exception, an enrolled annuitant may change the 
enrollment from self only to self and family, may change from one plan 
or option to another, or may make any combination of these changes. 
Exception: An annuitant who, as an employee, was subject to a court or 
administrative order as discussed in Sec.  890.301(g)(3) at the time he 
or she retired cannot cancel or suspend his or her enrollment, change 
to self only, or change to a comprehensive medical plan that does not 
serve the area where his or her children live after retirement as long 
as the court or administrative order is still in effect and the 
annuitant has at least one child identified in the order who is still 
eligible under the FEHB Program, unless the annuitant provides 
documentation to the retirement system that he or she has other 
coverage for the child or children.
* * * * *

0
5. In Sec.  890.502 add a new sentence after the first sentence in 
paragraph (b)(2), redesignate paragraph (b)(4) as paragraph (b)(4)(i), 
and add a new paragraph (b)(4)(ii) to read as follows:


Sec.  890.502  Employee withholdings and contributions.

* * * * *
    (b) * * *
    (2) * * * Exception: An employee who is subject to a court or 
administrative order as discussed in Sec.  890.301(g)(3) cannot elect 
to terminate his or her enrollment as long as the court/administrative 
order is still in effect and the employee has at least one child 
identified in the order who is still eligible under the FEHB Program, 
unless the employee provides documentation that he or she has other 
coverage for the child or children. * * *
* * * * *
    (4)(ii) If the employee is subject to a court or administrative 
order as discussed in Sec.  890.301(g)(3), the coverage cannot 
terminate. If the employee does not return the signed form, the 
coverage will continue and the employee will incur a debt to the 
Government as discussed in paragraphs (b)(2)(i) and (b)(2)(ii) of this 
section.
* * * * *

PART 892--FEDERAL FLEXIBLE BENEFITS PLAN: PRE-TAX PAYMENT OF HEALTH 
BENEFITS PREMIUMS

0
6. The authority citation for part 892 continues to read as follows:

    Authority: 5 U.S.C. 8913; 26 U.S.C. 125.


0
7. Amend by revising Sec.  892.207 to read as follows:


Sec.  892.207  Can I make changes to my FEHB enrollment while I am 
participating in premium conversion?

    (a) Subject to the exceptions described in paragraphs (b) and (c) 
of this section, you can make changes to your FEHB enrollment for the 
same reasons and with the same effective dates listed in Sec.  890.301 
of this chapter.
    (b) However, if you are participating in premium conversion there 
are two exceptions: you must have a qualifying life event to change 
from self and family enrollment to self only enrollment or to drop FEHB 
coverage entirely. (See Sec.  892.209 and Sec.  892.210.) Your change 
in enrollment must be consistent with and correspond to your qualifying 
life event as described in Sec.  892.101. These limitations apply only 
to changes you may wish to make outside open season.
    (c) If you are subject to a court or administrative order as 
discussed in Sec.  890.301(g)(3) of this chapter, your employing agency 
can limit a change to your enrollment as long as the court or 
administrative order is still in effect and you have at least one child 
identified in the order who is still eligible under the FEHB Program, 
unless you provide documentation to your agency that you have other 
coverage for your child or children. See also Sec.  892.208 and Sec.  
892.209.

0
8. Revise the section heading and add a new paragraph (c) to Sec.  
892.208 to read as follows:


Sec.  892.208  Can I change my enrollment from self and family to self 
only at any time?

* * * * *

    (c) If you are subject to a court or administrative order as 
discussed in Sec.  890.301(g)(3) of this chapter, you cannot change 
your enrollment to self only as long as the court or administrative 
order is still in effect and you have at least one child identified in 
the order who is still eligible under the FEHB Program, unless you 
provide documentation to your agency that you have other coverage for 
your child or children. See also Sec.  892.207 and Sec.  892.209.

0
9. Add a new paragraph (c) to Sec.  892.209 to read as follows:


Sec.  892.209  Can I cancel FEHB coverage at any time?

* * * * *
    (c) If you are subject to a court or administrative order as 
discussed in Sec.  890.301(g)(3) of this chapter, you cannot cancel 
your coverage as long as the court or administrative order is still in 
effect and you have at least one child identified in the order who is 
still eligible under the FEHB Program, unless you provide documentation 
to your agency that you have other coverage for your child or children.

[FR Doc. 03-24792 Filed 9-30-03; 8:45 am]
BILLING CODE 6325-50-P