Union Calendar No. 333

103D CONGRESS

2D SESSION H. R. 512

[Report No. 103–608]

A BILL

To amend chapter 87 of title 5, United States

nally ill, and for other purposes.paid out to an insured individual who is termifits under such chapter may, upon application, beCode, to provide that group life insurance beneJULY 18, 1994

Reported with an amendment, committed to the Commitordered to be printed tee of the Whole House on the State of the Union, and
IB

Union Calendar No. 333

103D CONGRESS

2D SESSION H. R. 512

[Report No. 103–608]

To amend chapter 87 of title 5, United States Code, to provide that group

life insurance benefits under such chapter may, upon application, be

paid out to an insured individual who is terminally ill, and for other

purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 21, 1993

Mr. GILMAN introduced the following bill; which was referred to the

Committee on Post Office and Civil Service

JULY 18, 1994

Additional sponsors: Mr. ENGEL, Mr. DORNAN, Mr. EMERSON, Mrs.

MORELLA, Miss COLLINS of Michigan, Mr. FISH, Mr. FROST, Mr. HYDE,

Mr. LEWIS of Florida, Mr. COLLINS of Georgia, Mr. JOHNSON of South

Dakota, Mr. HINCHEY, Mr. NADLER, Mr. FRANK of Massachusetts, Ms.

PELOSI, Mr. REYNOLDS, Mr. FALEOMAVAEGA, Mr. GENE GREEN of

Texas, Mr. MYERS of Indiana, Mr. FOGLIETTA, Ms. FURSE, and Mr.

FINGERHUT

JULY 18, 1994

Reported with an amendment, committed to the Committee of the Whole

House on the State of the Union, and ordered to be printed

[Insert the part printed in italic]

A BILL

To amend chapter 87 of title 5, United States Code, to

provide that group life insurance benefits under such
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chapter may, upon application, be paid out to an insured

individual who is terminally ill, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘FEGLI Living

5 Benefits Act’’.

6 SEC. 2. OPTION TO RECEIVE ‘‘LIVING BENEFITS’’.

7 (a) IN GENERAL.—Chapter 87 of title 5, United

8 States Code, is amended by inserting after section 8714c

9 the following:

10 ‘‘§ 8714d. Option to receive ‘living benefits’

11 ‘‘(a) For the purpose of this section, an individual

12 shall be considered to be ‘terminally ill’ if such individual

13 has a medical prognosis that such individual’s life expect14 ancy is 9 months or less.

15 ‘‘(b) The Office of Personnel Management shall pre16 scribe regulations under which any individual covered by

17 group life insurance under section 8704(a) may, if such

18 individual is terminally ill, elect to receive a lump-sum

19 payment equal to—

20 ‘‘(1) the full amount of insurance under section

21 8704(a) (or portion thereof designated for this pur22 pose under subsection (d)(4)) which would otherwise

23 be payable under this chapter (on the establishment

24 of a valid claim)—
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1 ‘‘(A) computed based on a date determined

2 under regulations of the Office (but not later

3 than 30 days after the date on which the indi4 vidual’s application for benefits under this sec5 tion is approved or deemed approved under sub6 section (d)(3)); and

7 ‘‘(B) assuming continued coverage under

8 this chapter at that time;

9 reduced by

10 ‘‘(2) an amount necessary to assure that there

11 is no increase in the actuarial value of the benefit

12 paid (as determined under regulations of the Office).

13 ‘‘(c)(1) If a lump-sum payment is taken under this

14 section—

15 ‘‘(A) no insurance under the provisions of sec16 tion 8704 (a) or (b) shall be payable based on the

17 death or any loss of the individual involved, unless

18 the lump-sum payment represents only a portion of

19 the total benefits which could have been taken, in

20 which case benefits under those provisions shall re21 main in effect, except that the basic insurance

22 amount on which they are based—

23 ‘‘(i) shall be reduced by the percentage

24 which the designated portion comprised relative

25 to the total benefits which could have been
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1 taken (rounding the result to the nearest mul2 tiple of $1,000 or, if midway between multiples

3 of $1,000, to the next higher multiple of

4 $1,000); and

5 ‘‘(ii) shall not be subject to further adjust6 ment; and

7 ‘‘(B) deductions and withholdings under section

8 8707, and contributions under section 8708, shall be

9 terminated with respect to such individual (or re10 duced in a manner consistent with the percentage

11 reduction in the individual’s basic insurance amount,

12 if applicable), effective with respect to any amounts

13 which would otherwise become due on or after the

14 date of payment under this section.

15 ‘‘(2) An individual who takes a lump-sum payment

16 under this section (whether full or partial) remains eligible

17 for optional benefits under sections 8714a–8714c (subject

18 to payment of the full cost of those benefits in accordance

19 with applicable provisions of the section or sections in20 volved, to the same extent as if no election under this sec21 tion had been made).

22 ‘‘(d)(1) The Office’s regulations shall include provi23 sions regarding the form and manner in which an applica24 tion under this section shall be made and the procedures
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1 in accordance with which any such application shall be

2 considered.

3 ‘‘(2) An application shall not be considered to be com4 plete unless it includes such information and supporting

5 evidence as the regulations require, including certification

6 by an appropriate medical authority as to the nature of

7 the individual’s illness and that the individual is not ex8 pected to live more than 9 months because of that illness.

9 ‘‘(3)(A) In order to ascertain the reliability of any

10 medical opinion or finding submitted as part of an applica11 tion under this section, the covered individual may be re12 quired to submit to a medical examination under the direc13 tion of the agency or entity considering the application.

14 The individual shall not be liable for the costs associated

15 with any examination required under this subparagraph.

16 ‘‘(B) Any decision by the reviewing agency or entity

17 with respect to an application for benefits under this sec18 tion (including one relating to an individual’s medical

19 prognosis) shall not be subject to administrative review.

20 ‘‘(4)(A) An individual making an election under this

21 section may designate that only a limited portion (ex22 pressed as a multiple of $1,000) of the total amount other23 wise allowable under this section be paid pursuant to such

24 election.
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1 ‘‘(B) A designation under this paragraph may not be

2 made by an individual described in paragraph (1) or (2)

3 of section 8706(b).

4 ‘‘(5) An election to receive benefits under this section

5 shall be irrevocable, and not more than one such election

6 may be made by any individual.

7 ‘‘(6) The regulations shall include provisions to ad8 dress the question of how to apply section 8706(b)(3)(B)

9 in the case of an electing individual who has attained 65

10 years of age.’’.

11 (b) TABLE OF SECTIONS.—The table of sections for

12 chapter 87 of title 5, United States Code, is amended by

13 inserting after the item relating to section 8714c the

14 following:

‘‘8714d. Option to receive ‘living benefits’.’’.

15 SEC. 3. EFFECTIVE DATE; OPEN SEASON AND NOTICE.

16 (a) EFFECTIVE DATE.—The amendments made by

17 section 2 shall take effect 9 months after the date of the

18 enactment of this Act.

19 (b) OPEN SEASON; NOTICE.—(1) The Office of Per20 sonnel Management shall prescribe regulations under

21 which, beginning not later than 9 months after the date

22 of the enactment of this Act, and over a period of not

23 less than 8 weeks—

24 (A) an employee (as defined by section 8701(a)

25 of title 5, United States Code) who declined or vol-
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1 untarily terminated coverage under chapter 87 of

2 such title—

3 (i) may elect to begin, or to resume, group

4 life insurance and group accidental death and

5 dismemberment insurance; and

6 (ii) may make such other elections under

7 such chapter as the Office may allow; and

8 (B) such other elections as the Office allows

9 may be made.

10 (2) The Office shall take such action as may be nec11 essary to ensure that employees and any other individuals

12 who would be eligible to make an election under this sub13 section are afforded advance notification to that effect.

14 SEC. 4. FUNDING.

15 Notwithstanding section 8714(a)(1) of title 5, United

16 States Code, the Office of Personnel Management shall re17 tain in the Employees’ Life Insurance Fund such portion

18 of premium payments otherwise due as will, no later than

19 September 30, 1995, permanently reduce the contingency

20 reserve established under the third sentence of section 8712

21 of such title 5 by an amount equal to the amount by which

22 payments from the Employees’ Life Insurance Fund during

23 the fiscal year ending September 30, 1995, exceed the pay24 ments that would have been paid had the amendments made

25 by this Act not been enacted.