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Long Term Care Reference Materials

 

Overview

Keep up to date with the Federal benefits programs by reading the Benefits Administration Letters.

The Federal Benefits FastFacts provides basic information about the Federal Benefits Programs administered by the Insurance Services Programs at OPM. We will issue FastFacts throughout the year so be sure to check back with us. Please note: before making any final decisions, please visit the home page for more specific information.

Benefits Adminstration Letters

The Office of Personnel Management is responsible for administration and oversight of the Federal Long Term Care Insurance Program (FLTCIP). These pages contain the Benefits Administration Letters (BALs) that provide guidance to agencies on FLTCIP.

BAL NumberDateSubject
11-901 02/2011 The Federal Long Term Care Insurance Program - Open Season April 4 - June 24, 2011
10-901 06/2010 Federal Long Term Care Insurance Program (FLTCIP): Qualified Relatives now include Same-Sex Domestic Partners
Attachment 1: Declaration of Domestic Partnership

Legislation

The Federal Long Term Care Insurance Program was established by Public Law 106-265, The Long-Term Care Security Act. It is codified in Title 5, Part III, Subpart G, Chapter 90, of the U.S. Code. Chapter 90 has subsequently been amended by several additional laws, mostly pertaining to the groups eligible to apply for insurance under the program.

The links below lead to a current copy of this portion of the U.S. Code and to the original and amending laws.

Public Laws

Regulations

Subpart A - Administration and General Provisions

Sec. 875.101 Definitions

This part is written as if the reader were an applicant or enrollee. Accordingly, the terms "you," "your," etc., refer, as appropriate, to the applicant or enrollee.

In this part, the terms annuitant, employee, member of the uniformed services, retired member of the uniformed services, and qualified relative have the meanings set forth in section 9001 of title 5, United States Code, and supplement the following definitions:

Abbreviated underwriting is a type of underwriting that asks fewer questions about your health status than with full underwriting to enable the Carrier to determine whether your application for coverage will be approved. The Carrier may also require review of your medical records, a phone interview, or an in-home interview.

Actively at work means:

  1. That as an active workforce member other than a member of the uniformed services you meet all of the following conditions:
    1. You are reporting for work at an approved work location and you work at least one-half of your regularly scheduled hours for that day; and
    2. You are able to perform all the usual and customary duties of your employment on your regular work schedule.
  2. For a member of the uniformed services, that you are on active duty and are physically able to perform the duties of your position.

Carrier means a qualified carrier as defined in section 9001 of title 5, United States Code, with which OPM has contracted to provide long term care insurance coverage under this section. A Carrier may designate 1 or more administrators to perform some of its obligations.

Eligible individual means an annuitant, active workforce member, member of the uniformed services, retired member of the uniformed services or qualified relative, as defined in section 9001 of title 5, United States Code.

Enrollee means an eligible individual whose application for coverage the Carrier has approved and whose coverage is in effect.

FLTCIP means the Federal Long Term Care Insurance Program.

Free look means that within 30 days after you receive the Benefit Booklet, you may cancel your coverage if you are not satisfied with it and receive a refund of any premium you paid. It will be as if the coverage was never issued.

Full underwriting is the more comprehensive type of underwriting under the FLTCIP, which requires that you answer many questions about your health status to enable the Carrier to determine whether your application for coverage will be approved. The Carrier may also require review of your medical records, a phone interview, or an in-home interview.

Stepparent means any person, other than your mother or father, who is currently married to one of your parents, or, if one of your parents is dead, a person who was married to that parent at the time of that parent's death.

Underwriting requirements means the information about your current health status and history and other information that you must provide to the Carrier with your application for coverage to enable the Carrier to determine your insurability.

Workforce member means a Federal civilian or Postal employee, member of the uniformed services, Federal annuitant, retired member of the uniformed services, or member of any other eligible group, as defined in section 9001 of title 5, United States Code. An active workforce member is one who is currently employed or is on active duty.

Sec. 875.102 Where do I send benefit claims?

You must submit your benefit claims to the FLTCIP Carrier or its designee.

Sec. 875.103 Do I need to authorize release of my medical records when I file a claim?

Yes, if you file a claim for benefits, the Carrier needs to have a valid authorization from you to release your medical records.

Sec. 875.104 What are the steps required to resolve a dispute involving benefit eligibility or payment of a claim?

  1. If you dispute the Carrier's denial of your eligibility for benefits or your claim for payment of benefits, you must first send a written request for reconsideration to the Carrier no later than 60 days from the date of its decision.
  2. The Carrier must provide you with written notice of its review decision no later than 60 days after the date it receives your reconsideration request.
  3. If the Carrier upholds its denial (or does not respond within 60 days), you have the right to appeal its reconsideration decision directly to the Carrier. You must make this appeal in writing within 60 days from the date of the Carrier's notice upholding its decision. You will be notified of the decision on your appeal in writing no later than 60 days from receipt of your appeal request.
  4. If a denial of your eligibility for benefits or a denial of your claim is upheld upon appeal due to the evaluation of your medical condition/functional capacity, the Carrier will inform you that you may request that an independent third party, mutually agreed to by OPM and the Carrier, review the decision. You must make this request in writing within 60 days from the date of the notice informing you of the appeal decision. The independent third party must notify you in writing of its decision no later than 60 days from the Carrier's or its designee's receipt of your request for appeal to the third party. This is the final administrative remedy available to you. The decision of the independent third party is final and binding on the Carrier.
  5. You may seek judicial review of the final administrative denial of a claim. Such action may not be brought prior to exhaustion of the administrative process provided in this section. To pursue such judicial review, you must bring legal action against the Carrier in an appropriate United States district court within 2 years from the date of the final decision. You may not sue OPM, the independent reviewer, or any other entity. If you prevail in court, your recovery is limited to the amount of benefits payable under your benefit booklet and schedule of benefits.
  6. The procedures described in paragraphs (a), (b), (c), (d), and (e) of this section apply only if you have valid coverage under the FLTCIP. If the Carrier determines that your coverage was based on an erroneous application and voids the coverage as described in § 875.408 of this part, these provisions do not apply. The Carrier will provide you with information on your review rights in its rescission letter (letter voiding your coverage).

Sec. 875.105 May OPM correct errors?

OPM may order correction of administrative errors after reviewing evidence and finding that it would be against equity and good conscience not to do so.

Sec. 875.106 What responsibilities do agencies have under this Program?

Federal agencies and uniformed services establishments are responsible for:

  1. Providing access to information about the FLTCIP to eligible individuals;
  2. Responding to questions from the Carrier, including questions on the employment status of an applicant or enrollee;
  3. Providing reports as OPM requires;
  4. Complying with Benefits Administration Letters and other OPM issuances/instructions; and
  5. Deducting premiums as authorized by a workforce member and as requested by the Carrier, when possible.

Sec. 875.107 What are OPM's responsibilities as regulator under this Program?

Consistent with the authority and discretion given to OPM by the FLTCIP law, OPM's responsibilities include those functions typically associated with, and preemptive of, State insurance regulatory authorities such as:

  1. Reviewing and approving the content and format of materials associated with the FLTCIP pursuant to section 9008(d) of title 5, United States Code;
  2. Reviewing and approving rates, forms, and marketing materials; and
  3. Determining the qualifications of enrollment personnel and the Program administrator(s).

Sec. 875.108 If the Carrier approves my application, will I get a certificate of insurance?

If the Carrier approves your application for coverage, OPM and/or the Carrier will make available to you a benefit booklet and schedule of benefits with complete coverage information, which will serve as your proof of insurance. You will also get a copy of your approved application for coverage.

Sec. 875.109 Is there a delegation of authority for resolving contract disputes between OPM and the Carrier?

For the purpose of making findings of fact and to the extent that conclusions of law may be required under any proceeding conducted in accordance with the provisions of the disputes clause included in the FLTCIP master contract, OPM delegates this function to the Armed Services Board of Contract Appeals.

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Subpart B - Eligibility

Sec. 875.201 Am I eligible as a Federal civilian or Postal employee?

  1. If you are a Federal civilian or Postal employee whose current position conveys eligibility for Federal Employees Health Benefits under part 890 of this chapter, you are also eligible to apply for coverage, with the following exceptions:
    1. If you are a District of Columbia employee or retiree, you are not eligible to apply for coverage, regardless of whether you are eligible for Federal Employees Health Benefits coverage. There is a related exception, however: D.C. government employees and retirees who were first employed by the D.C. government before October 1, 1987 are eligible to apply for coverage.
    2. If you are a Tennessee Valley Authority employee or retiree, you are eligible to apply for coverage, even though you may not be eligible for Federal Employees Health Benefits coverage.
    3. If you are a Non-Appropriated Fund (NAF) employee or retiree you are eligible to apply when the Secretary of Defense determines such eligibility for the NAF instrumentality that employs you, and you will be treated the same as a Federal civilian employee or retiree (as applicable) under this Part.
  2. If you are a Federal civilian or Postal employee whose current position is excluded from Federal Employees Health Benefits eligibility under Sec. 890.102 of this chapter, you are excluded from applying for coverage unless paragraph (a)(2) of this section applies.
  3. If you are an annuitant reemployed by the Federal Government, you may apply for coverage as an employee.

Sec. 875.202 Am I eligible as a Federal annuitant?

If you are a Federal annuitant, including a survivor annuitant, a deferred annuitant, or a compensationer, you are eligible to apply for coverage. Separated Federal employees with title to a deferred annuity may apply for coverage, even if they are not yet receiving that annuity.

Sec. 875.203 Am I eligible if I separated under the FERS MRA+10 provision?

If you have separated from service under the FERS Minimum Retirement Age and 10 years of service (MRA+10) provision of 5 U.S.C. 8412(g), and have postponed receiving an annuity under that provision, you are eligible to apply for coverage under this part.  For underwriting purposes, you will be considered an annuitant.

Sec. 875.204 Am I eligible as a member of the uniformed services?

  1. You are eligible to apply for coverage if you are on active duty or full-time National Guard duty for more than a 30-day period.
  2. You are eligible to apply for coverage if you are a member of the Selected Reserve, which consists of:
    1. Drilling Reservists and Guardsmembers assigned to Reserve Component Units;
    2. Individual Mobilization Augmentees who are Reservists assigned to Reserve Component billets in Active Component units (you may be performing duty in a pay or non-pay status); and
    3. Active Guard and Reserve members who are full-time Reserve members on full-time National Guard duty or active duty in support of the National Guard or Reserves.
  3. You are not eligible to apply for coverage if you belong to the Individual Ready Reserve. The Individual Ready Reserves includes Reservists who are assigned to a Voluntary Training Unit in the Naval Reserve and Category E in the Air Force Reserve.

Sec. 875.205 Am I eligible as a retired member of the uniformed services?

  1. You are eligible to apply for coverage if you are a retired member of the uniformed services entitled to retired or retainer pay (including disability retirement pay).
  2. You are eligible to apply for coverage if you are a retired reservist who is currently receiving retirement pay.
  3. You are eligible to apply for coverage as a retired ("grey") reservist, even if not yet receiving retirement pay.

Sec. 875.206 As a new active workforce member, when may I apply?

  1. As a new, newly eligible, or returning active workforce member, you may apply as follows:
    1. If you are a new active workforce member entering a position that conveys eligibility, you may apply for coverage within 60 days after becoming eligible.
    2. If you are entering a position that conveys eligibility as an active workforce member from a position that did not convey eligibility, you may apply for coverage within 60 days after becoming eligible.
    3. If you return to active service after a break in service of 180 days or more to a position that conveys eligibility, you may apply for coverage within 60 days after becoming eligible.
  2. Your spouse may also apply during that 60-day period after you become eligible.
  3. The underwriting requirements that will be required will be those applicable to active workforce members and their spouses during the last Open Season for enrollment before the date of your application.
  4. After the 60-day period ends, you may still apply for coverage, as may your spouse, but full underwriting requirements will apply.
  5. If your employing office determines that you were unable, for a cause beyond your control, to submit an application during the initial 60-day period, you may submit an application within 60 days after your employing office advises you of that determination. Similarly, your employing office may make this determination if your spouse is unable to submit an application during the same time period for a cause beyond his/her control. This employing office authority only applies within 6 months after the beginning date of the initial eligibility period. The underwriting requirements will be as specified in paragraph (c) of this section.
  6. Your other qualified relatives may apply for coverage at any time.  They will be subject to full underwriting requirements.

Sec. 875.207 What happens if I am in nonpay status during an Open Season?

  1. If you return to a pay status from nonpay status during the Open Season, you have 60 days from the date of your return, or until the end of the Open Season, whichever gives you more time, to apply for coverage pursuant to the Open Season underwriting requirements for Federal civilian or Postal employees and members of the uniformed services.
  2. If you return to pay status from nonpay status after the Open Season, you have 60 days from the date of your return to apply for coverage pursuant to the underwriting requirements specified for Federal civilian or Postal employees and members of the uniformed services in the immediately preceding Open Season.
  3. Paragraphs (a) and (b) of this section apply only when you have been in nonpay status for more than one-half of an Open Season, unless you went into nonpay status for a reason beyond your control.

Sec. 875.208 May I apply as a qualified relative if the person on whom I am basing my eligibility status has died?

You may not apply as a qualified relative if the workforce member on whom you are basing your qualified relative status died prior to the time you apply for coverage, unless you are receiving a survivor annuity as the spouse of a deceased workforce member. In this case, your adult children and your current spouse are also considered to be qualified relatives.

Sec. 875.209 How do I demonstrate that I am eligible to apply for coverage?

  1. When you submit your application for coverage, you must make known your status as a member of an eligible group.
  2. If the Carrier finds that you misrepresented your eligibility status, the Carrier has the right to void your coverage and return to you any premiums you paid, without interest.  The incontestability provisions in Sec. 875.408 do not apply to this section.

Sec. 875.210 What happens if I become ineligible after I submit an application?

  1. You must be eligible at the time of your application and at the time your coverage is scheduled to go into effect. Except as noted in paragraph (b) of this section, if you lose your status as part of an eligible group before your coverage goes into effect, you are no longer eligible for FLTCIP coverage. You are required to inform the Carrier that you are no longer eligible.
  2. In two instances, you will continue to be eligible for coverage even if you lose your status as part of an eligible group after you submit an application for coverage, but before your coverage becomes effective. The two instances are:
    1. When you are involuntarily separated from Federal civilian service (except for misconduct) or from the uniformed services (except for a dishonorable discharge). In either of these events, your qualified relatives will continue to be eligible.
    2. When you are the qualified relative of a workforce member who dies.

Sec. 875.211 What happens if my eligibility status changes after I submit an application?

  1. If you applied as an active workforce member, and separate from service under the MRA+10 provisions of 5 U.S.C. 8412(g), or retire after you submit an application for coverage, but before your coverage becomes effective, you must reapply as an annuitant and submit to full underwriting requirements.
  2. If you applied as an active workforce member, and otherwise separate from service, but you are a qualified relative of another workforce member, you must reapply based on the additional underwriting requirements specified for that type of qualified relative.

Sec. 875.212 Is there a minimum application age?

Yes, there is a minimum application age. You must be at least 18 years old at the time you submit an application for coverage.

Sec. 875.213 May I apply as a qualified relative if I am the domestic partner of an employee or annuitant?

Final Regulations (June 1, 2010)

Subpart C - Cost

Sec. 875.301 Is there a Government contribution toward premiums?

There is no Government premium contribution toward the cost of long term care insurance.

Sec. 875.302 What are the options for making premium payments?

  1. Premium payments may be made by Federal payroll or annuity deduction, uniformed services retirement pay deduction, by pre- authorized debit, or by direct billing.
  2. You must continue to make premium payments when they are due for your coverage to stay in effect.

Sec. 875.303 How are premium payment errors corrected?

  1. If the Carrier finds that you have underpaid the premium rate for your age and/or level of coverage, you must pay retroactive premiums to the Carrier for the amount due. If you fail to pay back premiums within the time provided by the Carrier to correct the error, the Carrier may terminate your coverage.
  2. If the Carrier finds that you have overpaid premiums, the Carrier will either reimburse you or reduce a future premium payment(s) by the amount of the overpayment.
  3. If you die while you have coverage, any premiums paid for the period beyond the date of your death will be refunded to your estate or to an alternate payee. If there is no estate, the Carrier will determine whether to pay the refund to an alternate payee. If you cancel your coverage, any premiums paid in advance for the period following the effective date of your cancellation will be refunded to you.
  4. Any premiums you paid will be returned if you cancel coverage within the "free look" period specified in the benefit booklet.

Sec. 875.304 How does the Carrier account for FLTCIP funds?

The Carrier must keep account of all funds received under this section separate from all other funds. The Carrier may use FLTCIP funds only for purposes specifically related to the FLTCIP.

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Subpart D - Coverage

Sec. 875.401 How do I apply for coverage?

  1. To apply for coverage, you must complete the application in a form appropriate for your eligibility status as prescribed by the Carrier and approved by OPM.
  2. If you are the qualified relative of a workforce member, you may apply for coverage even if the workforce member does not apply for coverage.

Sec. 875.402 When will Open Seasons be held?

  1. The first Open Season for enrollment under this section began July 1, 2002, as described in a Federal Register Notice (67 FR 43691, June 28, 2002), including the Open Season ending date(s) and which eligible individuals may apply based on abbreviated underwriting.
  2. There are no regularly scheduled Open Seasons for long term care insurance. OPM will announce any subsequent Open Seasons via a Federal Register Notice. The Notice will include the requirements for applicants during the Open Season.
  3. In situations where new eligibility groups are added to the Program, and OPM determines that it is appropriate to have an Open Season, OPM will provide notice and set the requirements for a special Open Season limited to those eligible individuals.

Sec. 875.403 May I apply for coverage outside of an Open Season?

If you are eligible for coverage, you may submit an application at any time outside of an Open Season. You will be subject to full underwriting requirements. The only exceptions to the full underwriting requirements outside of an Open Season are described in §875.206 and §875.405.

Sec. 875.404 What is the effective date of coverage?

  1. The effective dates of coverage under Open Season enrollments will be announced in a Federal Register Notice that announces Open Season dates.
    1. If you enroll at any time outside of an Open Season, your coverage effective date is the 1st day of the month after the date your application is approved.
    2. If you are an active workforce member and you are applying for coverage under abbreviated underwriting, you also must be actively at work at least 1 day during the calendar week immediately before the week which contains your coverage effective date for your coverage to become effective. You must inform the Carrier if you do not meet this requirement. In the event you do not meet this requirement, the Carrier will issue you a revised effective date, which will be the 1st day of the next month. You also must meet the actively at work requirement for any revised effective date for coverage to become effective, or you will be issued another revised effective date in the same manner.

Sec. 875.405 If I marry, may my new spouse apply for coverage?

    1. If you are an active workforce member and you have married, your spouse is eligible to submit an application for coverage under this section within 60 days from the date of your marriage, and will be subject to the underwriting requirements in force for the spouses of active workforce members during the most recent Open Season. You, however, are not eligible for abbreviated underwriting because of your marriage. You may apply for coverage along with your spouse, but full underwriting will be required for you.
    2. After 60 days, your spouse may still apply for coverage but will be subject to full underwriting. Your new qualified relatives (such as parents-in-law) may apply for coverage with full underwriting at any time following the marriage.
  1. The new spouse and other qualified relatives of an annuitant or retired member of the uniformed services may apply for coverage with full underwriting at any time following the marriage.

Sec. 875.406 May I change my coverage?

  1. You may make the following changes to your coverage:
    1. You may apply to increase your coverage at any time.  Full underwriting is required, except when an Open Season allows abbreviated underwriting.
    2. If you increase your coverage by adding to your daily benefit amount, the premiums for the additional coverage will be based on your age, prevailing premium rates, and coverage rules in effect at the time you purchase the additional coverage.
    3. For other types of coverage increases, your entire premium will be based on your age, prevailing premium rates, and coverage rules in effect at the time you purchase the increased coverage. Any increase in coverage will take effect on the 1st day of the month following the date the Carrier approves your request for an increase.
  2. You may decrease your coverage at any time, although any decrease will be subject to coverage rules at the time of the decrease. Decreased coverage takes effect on the 1st day of the month after the Carrier receives your request. You will not receive any refund of premiums paid for coverage you held before the decrease; however, your subsequent premiums will be reduced based on your new, lower level of coverage. The Carrier will refund or credit any portion of premium paid in advance for the period following the date on which you decrease your coverage.
  3. You may cancel your coverage at any time.
    1. If you cancel during the free look period, your premiums will be refunded to you.
    2. If you cancel your coverage at any time other than during the free look period, cancellation will take effect on your requested cancellation date or at the end of the period covered by your last premium payment, whichever occurs first.  You will not receive any refund of premiums paid, other than any premiums paid in advance for the period following the effective date of your cancellation of coverage, and you will not have to pay any more premiums unless you owed retroactive premiums.

Sec. 875.407 Who makes insurability decisions?

The Carrier determines the insurability of all applicants. The Carrier's decision may not be appealed to OPM.

Sec. 875.408 What is the significance of incontestability?

  1. Incontestability means coverage issued based on an erroneous application may remain in effect. Such coverage will not remain in effect, and your claim may be denied, under any of the following conditions:
    1. If your coverage has been in force for less than 6 months, the Carrier may void your coverage upon a showing that information on your signed application that was material to your approval for coverage is different than what is shown in your medical records.
    2. If your coverage has been in force for at least 6 months but less than 2 years, the Carrier may void your coverage oupon a showing that information on your signed application that was material to your approval for coverage is different from what is shown in your medical records, and pertains to the condition for which benefits are sought.
    3. After your coverage has been in effect for 2 years, the Carrier may void your coverage only upon a showing that you knowingly and intentionally made a false or misleading statement or omitted information in your signed application for coverage regarding your health status that was material to your approval for coverage..
    4. If your coverage is voided, as described in paragraph (a)(1), (a)(2), or (a)(3) of this section, no claims will be paid. In addition, the provision of §875.104 relating to the procedures for resolving a dispute involving benefits eligibility or claims denials do not apply to your situation. You may request a review by the Carrier if you believe that your coverage was voided in error. You must submit your request in writing to the Carrier within 30 days of the date of the rescission letter (letter voiding your coverage).
  2. Your coverage can be contested at any time when the Carrier finds that you were not an eligible individual at the time you applied and were approved for coverage.
  3. If the Carrier voids coverage after it has paid benefits, it cannot recover the benefits already paid.
  4. Incontestability does not apply when you have not paid your premiums on a timely basis.

Sec. 875.409 Must I provide an authorization to release medical information?

You must provide the Carrier with an authorization to release medical information when requested. The Carrier may deny a claim for benefits or void your coverage if the Carrier does not receive an authorization to release medical information within 3 weeks after its request (4 weeks for those outside the United States).

Sec. 875.410 May I continue my coverage when I leave Federal or military service?

If you are an active workforce member, your coverage will automatically continue when you leave active service, as long as the Carrier continues to receive the required premium when due. However, once you leave active service, you are no longer eligible for any abbreviated underwriting provided during any future Open Season.

Sec. 875.411 May I continue my coverage when I am no longer a qualified relative?

If you are already enrolled as a qualified relative, you may continue your FLTCIP coverage if you subsequently lose qualified relative status (such as upon divorce), as long as the Carrier receives the required premium when due.

Sec. 875.412 When will my coverage terminate?

Your coverage will terminate on the earliest of the following dates:

  1. The date you specify to the Carrier that you wish your coverage to end;
  2. The date of your death;
  3. The end of the period covered by your last premium payment if you do not pay the required premiums when due, after a grace period of 30 days; or
  4. The date you have exhausted your maximum lifetime benefit.

    (However, in this event, care coordination services will continue.)

Sec. 875.413 Is it possible to have coverage reinstated?

  1. Under certain circumstances, your coverage can be reinstated. The Carrier will reinstate your coverage if it receives proof satisfactory to it, within 6 months from the termination date, that you suffered from a cognitive impairment or loss of functional capacity, before the grace period ended, that caused you to miss making premium payments. In that event, you will not be required to submit to underwriting. Your coverage will be reinstated retroactively to the termination date but you must pay back premiums for that period. The premium will be the same as it was prior to termination.
  2. If your coverage has terminated because you did not pay premiums or because you requested cancellation, the Carrier may reinstate your coverage within 12 months from the termination date at your request. You will be required to reapply based on full underwriting, and the Carrier will determine whether you are still insurable. If you are insurable, your coverage will be reinstated retroactively to the termination date and you must pay back premiums for that period. The premium will be the same as it was prior to termination.

Sec. 875.414 Will benefits be coordinated with other coverage?

Yes, benefits will be coordinated with other plans, following the coordination of benefits (COB) guidelines set by the National Association of Insurance Commissioners.  The total benefits from all plans that pay a long term care benefit to you should not exceed the actual costs you incur. The other plans that are considered for COB purposes include government programs, group medical benefits, and other employer-sponsored long term care insurance plans.  Medicaid, individual insurance policies, and association group insurance policies are not taken into consideration under this provision.

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Public Laws

National Defense Authorization Act for Fiscal Year 2004

SEC. 561. ADDITIONAL CLASSES OF INDIVIDUALS ELIGIBLE TO PARTICIPATE IN THE FEDERAL LONG - TERM CARE INSURANCE PROGRAM.

  1. CERTAIN EMPLOYEES OF THE DISTRICT OF COLUMBIA GOVERNMENT- Section 9001(1) of title 5, United States Code, is amended by striking '2105(c),' and all that follows and inserting '2105(c).'.
  2. FORMER FEDERAL EMPLOYEES WHO WOULD BE ELIGIBLE TO BEGIN RECEIVING AN ANNUITY UPON ATTAINING THE REQUISITE MINIMUM AGE- Section 9001(2) of title 5, United States Code, is amended--
    1. in subparagraph (A), by striking 'and' at the end;
    2. in subparagraph (B), by striking the period and inserting '; and'
    3. by adding at the end the following new subparagraph:

      C) any former employee who, on the basis of his or her service, would meet all requirements for being considered an 'annuitant' within the meaning of subchapter III of chapter 83, chapter 84, or any other retirement system for employees of the Government, but for the fact that such former employee has not attained the minimum age for title to annuity.'
  3. Reservists Transferred to the Retired Reserve Who Are Under Age 60- Section 9001(4) of title 5, United States Code, is amended by striking 'including' and all that follows through 'who has' and inserting 'and a member who has been transferred to the Retired Reserve and who would be entitled to retired pay under chapter 1223 of title 10 but for not having'.
  4. REFERENCE AMENDMENT - Section 9001(2)(A) of title 5, United States Code, as amended by subsection (b), is further amended by striking 'of this subsection'.

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U.S. Code, Title 5, Part III, Subpart G

CHAPTER 90 - LONG-TERM CARE INSURANCE

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

Sec. 9001. Definitions

For purposes of this chapter:

  1. EMPLOYEE- The term ‘employee’ means--
    1. an employee as defined by section 8901(1);
    2. an individual described in section 2105(e);
    3. an individual employed by the Tennessee Valley Authority; and
    4. an employee of a nonappropriated fund instrumentality of the Department of Defense described in section 2105(c).
  2. Annuitant.--The term ‘annuitant’ means--
    1. any individual who would satisfy the requirements of 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);
    2. any individual who--
      1. satisfies all requirements for title to an annuity under subchapter III of chapter 83, chapter 84, or any other retirement system for employees of the Government (whether based on the service of such individual or otherwise), and files application therefor;
      2. is at least 18 years of age; and
      3. would not (but for this subparagraph) otherwise satisfy the requirements of this paragraph; and
    3. any former employee who, on the basis of his or her service, would meet all requirements for being considered an ‘annuitant’ within the meaning of subchapter III of chapter 83, chapter 84, or any other retirement system for employees of the Government, but for the fact that such former employee has not attained the minimum age for title to annuity.
  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--
    1. on active duty or full-time National Guard duty for a period of more than 30 days; and
    2. 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, and a member who has been transferred to the Retired Reserve and who would be entitled to retired pay under chapter 1223 of title 10 but for not having 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:
    1. The spouse of an individual described in paragraph (1), (2), (3), or (4).
    2. A parent, stepparent, or parent-in-law of an individual described in paragraph (1) or (3).
    3. 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.
    4. 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--
    1. except as otherwise provided in this paragraph, the Secretary of Defense;
    2. with respect to the Coast Guard when it is not operating as a service of the Navy, the Secretary of Transportation;
    3. with respect to the commissioned corps of the National Oceanic and Atmospheric Administration, the Secretary of Commerce; and
    4. with respect to the commissioned corps of the Public Health Service, the Secretary of Health and Human Services.

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Sec. 9002. Availability of insurance

  1. IN GENERAL- The Office of Personnel Management shall establish and, in consultation with the appropriate Secretaries, administer 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.
  2. DISCRETIONARY AUTHORITY REGARDING NONAPPROPRIATED FUND INSTRUMENTALITIES- The Secretary of Defense may determine that a nonappropriated fund instrumentality of the Department of Defense is covered under this chapter or is covered under an alternative long-term care insurance program.
  3. 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.
  4. 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.
  5. 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.
    6. 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).

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Sec. 9003. Contracting authority

  1. 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.
  2. TERMS AND CONDITIONS-
    1. IN GENERAL- Each master contract under this chapter shall contain--
      1. a detailed statement of the benefits offered (including any maximums, limitations, exclusions, and other definitions of benefits);
      2. the premiums charged (including any limitations or other conditions on their subsequent adjustment);
      3. the terms of the enrollment period; and
      4. 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.
  3. PAYMENT OF REQUIRED BENEFITS; DISPUTE RESOLUTION-
    1. IN GENERAL- Each master contract under this chapter shall require the carrier to agree--
      1. to provide payments or benefits to an eligible individual if such individual is entitled thereto under the terms of the contract; and
      2. with respect to disputes regarding claims for payments or benefits under the terms of the contract--
        1. to establish internal procedures designed to expeditiously resolve such disputes; and
        2. 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--
      1. 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);
      2. 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.
  4. 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-
      1. 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’.
      2. 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).

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Sec. 9004. Financing

  1. 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.
  2. WITHHOLDINGS-
    1. IN GENERAL- The amount necessary to pay the premiums for enrollment may--
      1. in the case of an employee, be withheld from the pay of such employee;
      2. in the case of an annuitant, be withheld from the annuity of such annuitant;
      3. in the case of a member of the uniformed services described in section 9001(3), be withheld from the pay of such member; and
      4. 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.
  3. DIRECT PAYMENTS- All amounts withheld under this section shall be paid directly to the carrier.
  4. 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.
  5. 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.
  6. REIMBURSEMENTS-
    1. REASONABLE INITIAL COSTS-
      1. 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.
      2. 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 rata basis, in accordance with appropriate provisions which shall be included in master contracts under this chapter.
    2. SUBSEQUENT COSTS-
      1. 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).
      2. 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.

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Sec. 9005. Preemption

  1. CONTRACTUAL PROVISIONS.—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.
  2. PREMIUMS.--
    1. IN GENERAL.--No tax, fee, or other monetary payment may be imposed or collected, directly or indirectly, by any State, the District of Columbia, or the Commonwealth of Puerto Rico, or by any political subdivision or other governmental authority thereof, on, or with respect to, any premium paid for an insurance policy under this chapter.
    2. RULE OF CONSTRUCTION.--Paragraph (1) shall not be construed to exempt any company or other entity issuing a policy of insurance under this chapter from the imposition, payment, or collection of a tax, fee, or other monetary payment on the net income or profit accruing to or realized by such entity from business conducted under this chapter, if that tax, fee, or payment is applicable to a broad range of business activity.'

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Sec. 9006. Studies, reports, and audits

  1. 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.
  2. 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.
  3. 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.

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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.

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Sec. 9008. Administrative functions

  1. IN GENERAL- The Office of Personnel Management shall prescribe regulations necessary to carry out this chapter.
  2. ENROLLMENT PERIODS- The Office shall provide for periodic coordinated enrollment, promotion, and education efforts in consultation with the carriers.
  3. 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.
  4. 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--
      1. the projected effect of inflation on the value of those benefits; and
      2. 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--
      1. 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
        1. a summary description of how and when premiums for long-term care insurance under this chapter may be raised;
        2. the premium history during the last 10 years for each qualified carrier offering long-term care insurance under this chapter; and
        3. 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.

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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.’.

  1. 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.

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Public Law 107-314

[View the Entire Law]

One Hundred Seventh Congress of the United States of America

AT THE SECOND SESSION

Begun and held at the City of Washington on Wednesday, the twenty-third day of January, two thousand and two

An Act

To authorize appropriations for fiscal year 2003 for military activities of the Department of Defense, for military construction, and for defense activities of the Department of Energy, to prescribe personnel strengths for such fiscal year for the Armed Forces, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; FINDINGS.

  1. SHORT TITLE- This Act may be cited as the `Bob Stump National Defense Authorization Act for Fiscal Year 2003'.

. . . . .

SEC. 1101. ELIGIBILITY OF DEPARTMENT OF DEFENSE NONAPPROPRIATED FUND EMPLOYEES FOR LONG-TERM CARE INSURANCE.

  1. IN GENERAL- Section 9001(1) of title 5, United States Code, is amended--
    1. in subparagraph (B), by striking `and';
    2. in subparagraph (C), by striking the comma at the end and inserting `; and'; and
    3. by inserting after subparagraph (C) the following new subparagraph:

      (D) an employee of a nonappropriated fund instrumentality of the Department of Defense described in section 2105(c),'.

  2. DISCRETIONARY AUTHORITY- Section 9002 of such title is amended--
    1. by redesignating subsections (b), (c), (d), and (e) as subsections (c), (d), (e), and (f), respectively; and
    2. by inserting after subsection (a) the following new subsection (b):

      ‘(b) DISCRETIONARY AUTHORITY REGARDING NONAPPROPRIATED FUND INSTRUMENTALITIES- The Secretary of Defense may determine that a nonappropriated fund instrumentality of the Department of Defense is covered under this chapter or is covered under an alternative long-term care insurance program.’.

. . . . .

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