[Federal Register Volume 69, Number 26 (Monday, February 9, 2004)]
[Proposed Rules]
[Pages 5935-5936]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-2666]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 69 , No. 26 / Monday, February 9, 2004 / 
Proposed Rules  

[[Page 5935]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 890

RIN 3206-AK04


Changes in Health Benefits Enrollment

AGENCY: Office of Personnel Management.

ACTION: Proposed rule.

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SUMMARY: The Office of Personnel Management (OPM) is issuing proposed 
regulations on changes in health benefits enrollment for annuitants or 
survivor annuitants when a carrier terminates participation in the 
Federal Employees Health Benefits (FEHB) Program. We are proposing to 
amend the regulations to give OPM the authority to enroll annuitants in 
whichever option of the BC/BS Service Benefit Plan it determines will 
most closely approximate the terminated plan.

DATES: OPM must receive comments on or before April 9, 2004.

ADDRESSES: Send written comments to Abby L. Block, Deputy Associate 
Director for Employee and Family Support Policy, Strategic Human 
Resources Policy Division, Office of Personnel Management, 1900 E 
Street, NW., Washington, DC 20415-3666; or deliver to OPM, Room 3400, 
1900 E Street, NW., Washington, DC; or FAX to (202) 606-0633.

FOR FURTHER INFORMATION CONTACT: Nataya Battle, (202) 606-1874, or e-
mail to [email protected].

SUPPLEMENTARY INFORMATION:

Background

    Effective August 18, 1997, OPM amended 5 CFR 890.306(l)(4) to 
authorize OPM to enroll an annuitant in the standard option of the 
Service Benefit Plan when the annuitants' health plan terminates 
participation in whole or in part in the FEHB Program and the annuitant 
fails to elect to change to another participating health plan. At that 
time, the BC/BS Service Benefit Plan offered the high option and the 
standard option. The standard option was the lower level of benefits 
with a lower premium cost. Beginning with the January 1, 2002 contract 
year, the BC/BS Service Benefit Plan merged the high option coverage 
into the standard option coverage and added a basic option. The 
standard option is now the highest level of coverage offered with the 
more costly premium rate.
    In the existing regulation, an annuitant who does not elect to 
change health plans is deemed to have enrolled in the standard option, 
or if the plan he or she was enrolled in had two options, he or she is 
deemed to have enrolled in the same option previously enrolled in 
(either high or low), if the annuity is sufficient to pay the high 
option premium. The annuitant may not change to another health plan 
until the next open season.
    The more costly premium rate may not be affordable for many 
annuitants. Amending this regulation will allow OPM the flexibility to 
consider the premium rate and the benefits that the annuitant was 
receiving under his or her terminated health plan, and enroll the 
annuitant in the option of the BC/BS Service Benefit Plan that most 
closely approximates the terminated plan. In addition, this amendment 
will give the annuitant the opportunity to change the option or to 
change to another health plan of his or her choice within 60 days of 
the date OPM sent notification that he or she has been deemed enrolled 
in a particular option of the BC/BS Service Benefit Plan.

Regulatory Flexibility Act

    OPM has determined 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 
retirees.

Executive Order 12866, Regulatory Review

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

Federalism

    We have examined this rule in accordance with Executive Order 
13132, Federalism, and have determined that this rule will not have any 
negative impact on the rights, roles, and responsibilities of State, 
local, or Tribal governments.

List of Subjects in 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.

    Office of Personnel Management.
Kay Coles James,
Director.
    Accordingly, OPM is proposing to amend 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. In Sec. 890.306 revise paragraphs (l)(4)(ii), (l)(4)(iv) and 
(q)(1)(ii) to read as follows:


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

* * * * *
    (l) * * *
    (4) * * *
    (ii) If a plan discontinues all of its existing options, an 
annuitant who does not change the enrollment is deemed to have enrolled 
in the option of the Blue Cross and Blue Shield Service Benefit Plan 
that OPM determines most closely approximates the terminated plan.
* * * * *
    (iv) After an involuntary enrollment under paragraph (l)(4)(ii) or 
(iii) of this section becomes effective, the annuitant may change the 
enrollment to the other option of the Blue Cross and Blue Shield 
Service Benefit Plan or to another health plan of his or her choice 
retroactively within 60 days after OPM advises the annuitant of the new 
enrollment;
* * * * *
    (q) * * *
    (1) * * *
    (ii) Enroll in any plan in which the annuitant's share of the 
premium is less

[[Page 5936]]

than the amount of annuity. If the annuitant elects to change to a 
lower cost enrollment, the change takes effect immediately upon loss of 
coverage under the prior enrollment. The exemptions from debt 
collection procedures that are provided under Sec. 831.1305(d)(2) and 
Sec. 845.205(d)(2) of this chapter apply to elections under this 
paragraph (q)(1)(ii).
* * * * *

[FR Doc. 04-2666 Filed 2-6-04; 8:45 am]
BILLING CODE 6325-50-P