Federal Employees and Uniformed Services Group Long-Term Care Insurance Act of 2000

Summary: Authorizes the Office of Personnel Management, without regard to statutes requiring competitive bidding, to contract with qualified carriers to provide long-term care insurance under this Act. Sets forth contract terms, including a requirement that coverage may not be canceled except for nonpayment of premiums. Provides for five-year contracts. Describes conditions under which coverage may be terminated. Sets forth required elements of contracts, including portability of benefits.
Makes insured individuals responsible for 100 percent of the charges of coverage and requires individuals to have amounts withheld from pay for their coverage (authorizes such withholding for qualified relatives). Requires such reimbursements to be deposited into the Employees Health Benefits Fund and held in a separate Long-Term Care Insurance Account.
Preempts State and local law.
Requires qualified carriers to furnish reasonable reports and permit audits.
Requires insurance benefits claims to be filed within four years after the date on which the cost was incurred or the service was provided. Provides jurisdiction for disputed claims through U.S. district courts after exhausting all available administrative remedies.
Authorizes appropriations.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Federal Employees and Uniformed 
Services Group Long-Term Care Insurance Act of 2000''.

SEC. 2. LONG-TERM CARE INSURANCE.

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

                 ``CHAPTER 90--LONG-TERM CARE INSURANCE

``Sec.
``9001. Definitions.
``9002. Eligibility to obtain coverage.
``9003. Contracting authority.
``9004. Long-term care benefits.
``9005. Financing.
``9006. Preemption.
``9007. Studies, reports, and audits.
``9008. Claims for benefits.
``9009. Jurisdiction of courts.
``9010. Regulations.
``Sec. 9001. Definitions
    ``For purposes of this chapter, the term--
            ``(1) `activities of daily living' includes--
                    ``(A) eating;
                    ``(B) toileting;
                    ``(C) transferring;
                    ``(D) bathing;
                    ``(E) dressing; and
                    ``(F) continence;
            ``(2) `annuitant' has the meaning such term would have 
        under section 8901(3) if, for purposes of such paragraph, the 
        term `employee' were considered to have the meaning under 
        paragraph (5) of this section;
            ``(3) `appropriate Secretary' means--
                    ``(A) except as otherwise provided in this 
                paragraph, the Secretary of Defense;
                    ``(B) with respect to the United States Coast Guard 
                when it is not operating as a service of the Navy, the 
                Secretary of Transportation;
                    ``(C) with respect to the commissioned corps of the 
                National Oceanic and Atmospheric Administration, the 
                Secretary of Commerce; and
                    ``(D) with respect to the commissioned corps of the 
                Public Health Service, the Secretary of Health and 
                Human Services;
            ``(4) `eligible individual' means--
                    ``(A) an annuitant, employee, member of the 
                uniformed services, or retired member of the uniformed 
                services; or
                    ``(B) a qualified relative of an individual 
                described under subparagraph (A);
            ``(5) `employee' means--
                    ``(A) an employee as defined under section 8901(1) 
                (A) through (D) and (F) through (I), but does not 
                include an employee excluded by regulation of the 
                Office under section 9010; and
                    ``(B) an individual described under section 
                2105(e);
            ``(6) `member of the uniformed services' means a person 
        who--
                    ``(A)(i) is a member of the uniformed services on 
                active duty for a period of more than 30 days; or
                    ``(ii) is a member of the Selected Reserve as 
                defined under section 10143 of title 10, including 
                members on--
                            ``(I) full-time National Guard duty as 
                        defined under section 101(d)(5) of title 10; or
                            ``(II) active Guard and Reserve duty as 
                        defined under section 101(d)(6) of title 10; 
                        and
                    ``(B) satisfies such eligibility requirements as 
                the Office prescribes under section 9010;
            ``(7) `Office' means the Office of Personnel Management;
            ``(8) `qualified carrier' means a company or consortium 
        licensed and approved to issue group long-term care insurance 
        in all States and to do business in each of the States;
            ``(9) `qualified relative', as used with respect to an 
        eligible individual described under paragraph (4)(A), means--
                    ``(A) the spouse of such individual;
                    ``(B) a parent or parent-in-law of such individual; 
                and
                    ``(C) any other person bearing a relationship to 
                such individual specified by the Office in regulations;
            ``(10) `retired member of the uniformed services' means a 
        member of the uniformed services entitled to retired or 
        retainer pay (other than under chapter 1223 of title 10) who 
        satisfies such eligibility requirements as the Office 
        prescribes under section 9010; and
            ``(11) `State' means a State of the United States, and 
        includes the District of Columbia.
``Sec. 9002. Eligibility to obtain coverage
    ``(a) Any eligible individual may obtain long-term care insurance 
coverage under this chapter for such individual.
    ``(b) 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.
    ``(c) An individual shall not be eligible for coverage under this 
chapter if the individual would be immediately eligible to receive 
benefits upon obtaining coverage.
``Sec. 9003. Contracting authority
    ``(a)(1) Without regard to section 3709 of the Revised Statutes (41 
U.S.C. 5) or any other statute requiring competitive bidding, the 
Office may contract with qualified carriers for a policy or policies of 
group long-term care insurance to provide benefits as specified by this 
chapter.
    ``(2) The Office shall--
            ``(A) contract with--
                    ``(i) a primary carrier with respect to assumption 
                of risk;
                    ``(ii) no less than 2 qualified carriers to act as 
                reinsurers; and
                    ``(iii) as many qualified carriers as necessary to 
                administer this chapter, which shall also act as 
                reinsurers; and
            ``(B) ensure that each resulting contract is awarded on the 
        basis of contractor qualifications, price, and reasonable 
        competition to the maximum extent practicable.
    ``(b) The Office may design a benefits package or packages and 
negotiate final offerings with qualified carriers.
    ``(c) Each contract under this section shall contain a detailed 
statement of the benefits offered (including any maximums, limitations, 
exclusions, and other definitions of benefits), the rates charged 
(including any limitations or other conditions on any subsequent 
adjustment), and 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.
    ``(d) Premium rates charged under a contract entered into under 
this section shall reasonably reflect the cost of the benefits provided 
under that contract as determined by the Office.
    ``(e) The coverage and benefits made available to individuals under 
a contract entered into under this section shall be guaranteed to be 
renewable and may not be canceled by the carrier except for nonpayment 
of premium.
    ``(f) The Office may withdraw an offering under this section based 
on open season participation rates, the composition of the risk pool, 
or both.
    ``(g)(1) Each contract under this section shall require the carrier 
to provide insurance, payments, or benefits in an individual case if 
the Office (or a duly designated third-party) finds that the individual 
involved is entitled to such payment or benefit under the contract.
    ``(2) Each contract with a carrier described under subsection 
(a)(2)(A)(ii) shall require the carrier to participate in 
administrative procedures designed to bring about the expeditious 
resolution of disputes arising under such contract, including, in 
appropriate circumstances, 1 or more alternative means of dispute 
resolution, as prescribed by the Office.
    ``(h)(1)(A) Subject to subparagraph (B), each contract under this 
section shall be for a term of 5 years, unless terminated earlier by 
the Office.
    ``(B) The rights and responsibilities of the enrolled individual, 
the insurer, and the Office (or duly designated third-party) under any 
such contract shall continue until the termination of coverage of the 
enrolled individual.
    ``(2) Group long-term care insurance coverage obtained by an 
individual under this chapter shall terminate only upon the occurrence 
of--
            ``(A) the death of the insured;
            ``(B) exhaustion of benefits, as determined under the 
        contract; or
            ``(C) any event justifying a cancellation under subsection 
        (e).
    ``(3) Subject to paragraph (2), each contract under this section 
shall include such provisions as may be necessary and consistent with 
regulations of the Office under section 9010, to--
            ``(A) effectively preserve all parties' rights and 
        responsibilities under such contract notwithstanding the 
        termination of such contract (whether due to nonrenewal under 
        paragraph (1)(A) or otherwise); and
            ``(B) ensure that, once an individual becomes duly 
        enrolled, long-term care insurance coverage obtained by such 
        individual under that enrollment shall not be terminated due to 
        any change in status (as described under section 9001(4)), such 
        as separation from Government service or the uniformed 
        services, or ceasing to meet the requirements for being 
        considered a qualified relative (whether due to divorce or 
        otherwise).
    ``(i) Nothing in this chapter may be construed to grant authority 
for the Office or a third party to change the rules under which the 
contract operates for disputed claims purposes.
``Sec. 9004. Long-term care benefits
    ``(a) Benefits under this chapter shall be--
            ``(1) provided under qualified long-term care insurance 
        contracts, within the meaning of section 7702B of the Internal 
        Revenue Code of 1986; and
            ``(2) to the extent determined appropriate by the Office, 
        consistent with the more stringent of--
                    ``(A) the most recent standards recommended by the 
                National Association of Insurance Commissioners; or
                    ``(B) such standards as recommended in calendar 
                year 1993.
    ``(b) Each contract under section 9003, in addition to any matter 
otherwise required under this chapter, shall provide for--
            ``(1) adequate consumer protections (including through 
        establishment of sufficient reserves or reinsurance);
            ``(2) adequate protections in the event of carrier 
        bankruptcy (or other similar event);
            ``(3) availability of benefits upon appropriate 
        certification as to an individual's--
                    ``(A) inability (without substantial assistance 
                from another individual) to perform at least 2 
                activities of daily living for a period of at least 90 
                days due to a loss of functional capacity; or
                    ``(B) requiring substantial supervision to protect 
                such individual from threats to health and safety due 
                to severe cognitive impairment as defined in the 
                contract;
            ``(4) choice of service benefits (such as the expense-
        incurred method or the indemnity method);
            ``(5) the availability of inflation protection;
            ``(6) portability of benefits (consistent with section 9003 
        (e) and (h));
            ``(7) length-of-benefit options;
            ``(8) options relating to long-term care benefits designed 
        to provide maximum flexibility regarding care modalities, 
        including nursing home care, assisted living care, home care, 
        and care by family members;
            ``(9) options relating to elimination periods; and
            ``(10) options relating to nonforfeiture benefits.
``Sec. 9005. Financing
    ``(a) Each individual having long-term care insurance coverage 
under this chapter shall be responsible for 100 percent of the charges 
for such coverage.
    ``(b) The amount necessary to pay the premium for enrollment 
shall--
            ``(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 under section 9001(6), be withheld from the basic pay 
        of such member; and
            ``(4) in the case of a retired member of the uniformed 
        services described in section 9001(10), be withheld from the 
        retired pay or retainer pay payable to such member.
    ``(c) Withholdings to pay the charges for enrollment of a qualified 
relative may, upon election of the eligible individual related to the 
qualified relative, be withheld under subsection (b) in the same manner 
as if enrollment were for such eligible individual.
    ``(d) Any enrollee whose pay, annuity, or retired or retainer pay 
(as referred to in subsection (b)) 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), 
from which any such withholdings may be made) shall pay the full amount 
of those charges directly to the carrier.
    ``(e) Each carrier participating under this chapter shall account 
for all funds received under this chapter separate and apart from all 
other funds relating to contracts or matters that are unrelated to this 
chapter.
    ``(f)(1) A contract under this chapter shall include appropriate 
provisions under which the carrier shall reimburse the Office or other 
administering Federal agency for the administrative costs incurred by 
the Office or such agency under this chapter (such as for dispute 
resolution), and including the costs of the initial implementation of 
this chapter, which are allocable to such carrier.
    ``(2) Reimbursements required under this subsection, except those 
relating to the costs of the initial implementation of this chapter, 
shall be deposited in the Employees Health Benefits Fund established 
under section 8909, and held in a separate Long-Term Care Insurance 
Account. This account shall be available to the Office without 
limitation for the purposes of this chapter.
``Sec. 9006. Preemption
    ``Except with regard to any financial requirement imposed by a 
State or the District of Columbia which is more stringent than the 
analogous requirement imposed by section 9004(b)(1), this chapter shall 
supersede and preempt any State or local law, or law of a territory or 
possession, which is determined by the Office to be inconsistent with--
            ``(1) the provisions of this chapter; or
            ``(2) after consultation with appropriate State Insurance 
        Commissioners, the efficient provision of a nationwide long-
term care insurance program for Federal employees.
``Sec. 9007. Studies, reports, and audits
    ``(a) Each qualified carrier entering into a contract under this 
chapter shall--
            ``(1) furnish such reasonable reports as the Office 
        determines to be necessary to enable the Office to carry out 
        its functions under this chapter; and
            ``(2) permit the Office and representatives of the General 
        Accounting Office to examine such records of the carrier as may 
        be necessary to carry out the purposes of this chapter.
    ``(b) 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.
``Sec. 9008. Claims for benefits
    ``(a) A claim for benefits under this chapter shall be filed within 
4 years after the date on which the reimbursable cost was incurred or 
the service was provided.
    ``(b)(1) Except as provided under paragraph (2), benefits payable 
under this chapter for any reimbursable cost incurred or service 
provided are secondary to any other benefit payable for such cost or 
service. No payment may be made where there is no legal obligation for 
such payment.
    ``(2)(A) Benefits payable under the programs described under 
subparagraph (B) shall be secondary to benefits payable under this 
chapter.
    ``(B) The programs referred to under subparagraph (A) are--
            ``(i) the program of medical assistance under title XIX of 
        the Social Security Act (42 U.S.C. 1396 et seq.); and
            ``(ii) any other Federal or State programs that the Office 
        may specify in regulations that provide health benefit coverage 
        designed to be secondary to other insurance coverage.
``Sec. 9009. Jurisdiction of courts
    ``A claimant under this chapter may file suit against the carrier 
of the long-term care insurance policy covering such claimant in the 
district courts of the United States, after exhausting all available 
administrative remedies.
``Sec. 9010. Regulations
    ``(a) The Office shall prescribe regulations necessary to carry out 
this chapter.
    ``(b) The regulations of the Office shall--
            ``(1) prescribe the time at which and the manner and 
        conditions under which an individual may obtain or continue 
        long-term care insurance under this chapter, including--
                    ``(A) the length of time constituting the first 
                opportunity to enroll; and
                    ``(B) the minimum period of coverage required for 
                portability; and
            ``(2) provide for periodic coordinated enrollment promotion 
        and education efforts.
    ``(c) The regulations of the Office may not exclude--
            ``(1) an employee or group of employees solely on the basis 
        of the hazardous nature of employment; or
            ``(2) an employee who is occupying a position on a part-
        time career employment basis, as defined under section 3401(2).
    ``(d) Any regulations necessary to effect the application and 
operation of this chapter with respect to an eligible individual or a 
qualified relative of such individual shall be prescribed by the Office 
in consultation with the appropriate Secretary.''.
    (b) Technical and Conforming Amendment.--The table of chapters for 
part III of title 5, United States Code, is amended by inserting after 
the item relating to chapter 89 the following:

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

SEC. 3. AUTHORIZATION OF APPROPRIATIONS FOR IMPLEMENTATION.

    There are authorized to be appropriated such sums as may be 
necessary to pay costs incurred by the Office of Personnel Management 
for implementation of chapter 90 of title 5, United States Code, during 
the period between the date of enactment of this Act and the date on 
which long-term care insurance coverage first becomes effective under 
that chapter. Any reimbursement of such costs by a carrier under 
section 9005(f) of title 5, United States Code (as added by this Act) 
shall be deposited in the General Fund.

SEC. 4. EFFECTIVE DATE.

    (a) In General.--The amendments made by this Act shall take effect 
on the date of enactment of this Act.
    (b) Coverage.--Coverage under this Act shall become effective as 
specified by the Office of Personnel Management, except that such 
coverage shall be effective not later than the first day of the first 
fiscal year beginning more than 2 years after the date of enactment of 
this Act.