103D CONGRESS

2D SESSION H. R. 512

AN ACT

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.

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.
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1 ‘‘(b) The Office of Personnel Management shall pre2 scribe regulations under which any individual covered by

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

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

5 payment equal to—

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

7 8704(a) (or portion thereof designated for this pur8 pose under subsection (d)(4)) which would otherwise

9 be payable under this chapter (on the establishment

10 of a valid claim)—

11 ‘‘(A) computed based on a date determined

12 under regulations of the Office (but not later

13 than 30 days after the date on which the indi14 vidual’s application for benefits under this sec15 tion is approved or deemed approved under sub16 section (d)(3)); and

17 ‘‘(B) assuming continued coverage under

18 this chapter at that time;

19 reduced by

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

21 is no increase in the actuarial value of the benefit

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

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

24 section—
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1 ‘‘(A) no insurance under the provisions of sec2 tion 8704 (a) or (b) shall be payable based on the

3 death or any loss of the individual involved, unless

4 the lump-sum payment represents only a portion of

5 the total benefits which could have been taken, in

6 which case benefits under those provisions shall re7 main in effect, except that the basic insurance

8 amount on which they are based—

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

10 which the designated portion comprised relative

11 to the total benefits which could have been

12 taken (rounding the result to the nearest mul13 tiple of $1,000 or, if midway between multiples

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

15 $1,000); and

16 ‘‘(ii) shall not be subject to further adjust17 ment; and

18 ‘‘(B) deductions and withholdings under section

19 8707, and contributions under section 8708, shall be

20 terminated with respect to such individual (or re21 duced in a manner consistent with the percentage

22 reduction in the individual’s basic insurance amount,

23 if applicable), effective with respect to any amounts

24 which would otherwise become due on or after the

25 date of payment under this section.
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1 ‘‘(2) An individual who takes a lump-sum payment

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

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

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

5 with applicable provisions of the section or sections in6 volved, to the same extent as if no election under this sec7 tion had been made).

8 ‘‘(d)(1) The Office’s regulations shall include provi9 sions regarding the form and manner in which an applica10 tion under this section shall be made and the procedures

11 in accordance with which any such application shall be

12 considered.

13 ‘‘(2) An application shall not be considered to be com14 plete unless it includes such information and supporting

15 evidence as the regulations require, including certification

16 by an appropriate medical authority as to the nature of

17 the individual’s illness and that the individual is not ex18 pected to live more than 9 months because of that illness.

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

20 medical opinion or finding submitted as part of an applica21 tion under this section, the covered individual may be re22 quired to submit to a medical examination under the direc23 tion of the agency or entity considering the application.

24 The individual shall not be liable for the costs associated

25 with any examination required under this subparagraph.
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1 ‘‘(B) Any decision by the reviewing agency or entity

2 with respect to an application for benefits under this sec3 tion (including one relating to an individual’s medical

4 prognosis) shall not be subject to administrative review.

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

6 section may designate that only a limited portion (ex7 pressed as a multiple of $1,000) of the total amount other8 wise allowable under this section be paid pursuant to such

9 election.

10 ‘‘(B) A designation under this paragraph may not be

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

12 of section 8706(b).

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

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

15 may be made by any individual.

16 ‘‘(6) The regulations shall include provisions to ad17 dress the question of how to apply section 8706(b)(3)(B)

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

19 years of age.’’.

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

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

22 inserting after the item relating to section 8714c the

23 following:

‘‘8714d. Option to receive ‘living benefits’.’’.
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1 SEC. 3. EFFECTIVE DATE; OPEN SEASON AND NOTICE.

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

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

4 enactment of this Act.

5 (b) OPEN SEASON; NOTICE.—(1) The Office of Per6 sonnel Management shall prescribe regulations under

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

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

9 less than 8 weeks—

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

11 of title 5, United States Code) who declined or vol12 untarily terminated coverage under chapter 87 of

13 such title—

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

15 life insurance and group accidental death and

16 dismemberment insurance; and

17 (ii) may make such other elections under

18 such chapter as the Office may allow; and

19 (B) such other elections as the Office allows

20 may be made.

21 (2) The Office shall take such action as may be nec22 essary to ensure that employees and any other individuals

23 who would be eligible to make an election under this sub24 section are afforded advance notification to that effect.
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1 SEC. 4. FUNDING.

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

3 States Code, the Office of Personnel Management shall

4 retain in the Employees’ Life Insurance Fund such por5 tion of premium payments otherwise due as will, no later

6 than September 30, 1995, permanently reduce the contin7 gency reserve established under the third sentence of sec8 tion 8712 of such title 5 by an amount equal to the

9 amount by which payments from the Employees’ Life In10 surance Fund during the fiscal year ending September 30,

11 1995, exceed the payments that would have been paid had

12 the amendments made by this Act not been enacted.

Passed the House of Representatives July 19, 1994.

Attest:

Clerk.
103D CONGRESS

2D SESSION H. R. 512

AN ACT

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 bene-