Office of Personnel Management

Retirement and Insurance Service

1920 1954 1959 1986 

 

Benefits Administration Letter

Number: 96-208 Date: December 4, 1996 

SUBJECT: Waivers of the FEHB participation requirement for employees

accepting voluntary incentive payments under P.L. 104-208 or other

statutes and certain employees retiring under early optional or

discontinued service provisions during the buyout period

 

Purpose This letter explains how OPM intends to apply its waiver

authority for retiring employees who accept buyouts under

Public Law 104-208 or other statutes and certain employees

retiring under early optional or discontinued service

provisions during the buyout period.

 

General Public Law 103-226, the Federal Workforce Restructuring

Act of 1994 (FWRA), enacted March 30, 1994, authorized

certain Federal agencies to offer voluntary incentive

payments to their employees who separated during an

established period beginning with the date of enactment. In

support of this effort and in view of the legislative history of

P.L. 103-226, OPM decided to grant waivers of the FEHB

participation requirement to Executive agency employees

who received voluntary incentive payments under P.L. 103-

226 if the employee retired during the period beginning

March 30, 1994 (the effective date of P.L. 103-226), and

ending March 31, 1995 (or if the agency retained the

employee due to the agency need, not later than March 31,

1997). In addition, OPM decided to grant waivers to

employees authorized voluntary incentive payments by

similar legislation, such as the program for the Department

of Defense, for a period beginning March 30, 
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1994, and ending at the termination of the statutory buyout

authority applicable to the agency.

Concurrently, OPM granted waivers of the FEHB participation requirement to employees who took early optional

retirement as a result of early out authority for their agency,

and to employees who took discontinued service retirement

based on an involuntary separation due to RIF, directed

reassignment, reclassification to a lower grade, or

abolishment of position. 

Since OPM had already established its waiver policy on

these cases, we instituted a procedure for agencies to give

effect to the OPM decision in processing retirement claims

for affected employees. This obviated the need for each

retiree to send OPM a written request for a waiver. 

However, to qualify for these special procedures, the retiring

employee had to have been enrolled under the FEHB

Program on March 30, 1994, and to have been enrolled

continuously thereafter.

On September 30, 1996, a law very similar to P.L. 103-226

was passed. Public Law 104-208 provides for voluntary

separation incentives for all Executive branch agencies other

than those who have such authority under other statutes

(which would include Defense, Agriculture, and AID),

effective October 1, 1996. Thus, we have determined that it

is appropriate to revise our waiver policy to take

congnizance of P.L. 104-208 and its October 1, 1996

effective date. 

 

OPM's revised

 waiver policy

OPM's revised policy for granting waivers to retiring

employees who receive buyouts under P.L. 104-208 or who

take early optional retirement or a discontinued service

retirement on and after October 1 1996, is as follows.

OPM will grant waivers to Executive agency employees,

who separate for retirement on or after October 1, 1996, who

were covered under the FEHB Program on and after 
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October 1, 1996, and who:

receive a voluntary incentive payment under P.L.

104-208; or

during the statutory buyout period (October 1,

1996, through December 30, 1997), take early

optional retirement as a result of early out

authority in the agency; or

during the statutory buyout period (October 1,

1996, through December 30, 1997), take a

discontinued service retirement based on an

involuntary separation due to RIF, directed

reassignment, reclassification to a lower grade, or

abolishment of position.

As in the past, since OPM has already established its waiver

policy, employees who meet these requirements do not need

to write a letter requesting a waiver. Instead, agencies must

attach a memorandum to the employee's retirement

application stating that the employee meets the requirements

for waiver by OPM as set forth in this BAL 96-208.

 

Statutory buyout 

 authority other than 

 P.L. 104-208

Some agencies have separate buyout authority. For

example, the Department of Defense has separate statutory

buyout authority that has continued since 1994 and the

Department of Agriculture received new statutory buyout

authority in August 1996. The policy set forth in IOIB No.

296 and subsequent Benefit Administration Letters (that is,

continuous FEHB coverage since March 30, 1994) applies to

employees of these agencies who separate for retirement

before October 1, 1996. The policy set forth in this letter

applies to employees of these agencies who separate for

retirement on and after October 1, 1996.

To the extent that these statutes allow the agency to postpone

an employee's departure beyond the expiration of the

statutory buyout period, employees who separated after the

statutory buyout period and who actually receive buyouts
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will be eligible for waivers under the policy set forth in this

letter. Employees who separate after the statutory buyout

period who do not receive buyouts will not be eligible for

waivers under this policy.

 

Employees who do 

 not meet 

requirements for an 

automatic waiver

Retiring employees who do not meet the requirements for an

automatic waiver may ask OPM to waive the participa-tion

requirement in their case. They should send their waiver

requests to the following address:

Office of Personnel Management

Retirement and Insurance Service

Office of Retirement Programs

P.O. Box 14172

Washington, D.C. 20044-4172

 

Unusual

circumstances

If Insurance Officers become aware of a class of employees

who do not meet the requirements for an automatic waiver as

outlined in this letter, but should be considered for a waiver,

they should contact OPM's Insurance Policy and Information

Division on 202-606-0191.

 

Inquiries Employees who need more information about this subject

should contact their personnel offices. Personnel office staff

should contact their headquarters Retirement Counselor or

Insurance Officer. Others may contact OPM's Insurance

Policy and Information Division on 202-606-0191.

 

Abby L. Block, Chief

Insurance Policy and

 Information Division