Office of Personnel Management

Retirement and Insurance Group

1920 1954 1959 

 

1986 

Benefits Administration Letter

Number: 95-204 Date: January 13, 1995 

SUBJECT: Establishing Procedures for Processing Reconsideration

Requests

 

Purpose The purpose of this Benefit Administration

Letter is to provide guidance to agencies in

setting up the administrative review

procedures for reconsideration of initial

decisions about health benefit and life

insurance enrollment issues. 

This responsibility, formerly handled by the

Office of Personnel Management, was recently

delegated to agencies. Final regulations

were published in the Federal Register on

December 27, 1994. 

 

What is

reconsideration?

Reconsideration consists of a review of an

initial decision to determine whether the law

and regulations were correctly applied to the

case. It is the employee's final level of

administrative review for enrollment and

coverage decisions under the Federal

Employees Health Benefits (FEHB) and Federal

Employees' Group Life Insurance (FEGLI)

Programs. 

The law and regulations set forth the

circumstances that allow enrollees to enroll

or change enrollment in the FEHB Program and

to cancel waivers of basic life insurance and

change optional coverage under the Federal

Employees' Group Life Insurance Program. The

regulations also give the effective dates of

enrollments and changes in enrollment. 

 

Initial decisions When an employing office receives an
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employee's SF 2809 (or when an employee 

otherwise requests a change in enrollment),

it must decide whether or not to accept the

employee's health benefits election. The

events that allow employees to enroll or

change enrollment, and the timeframes within

which the changes may be made are set forth

in 5 CFR 890.301 and additional guidance is

provided in Subchapter S7 of the FEHB

Handbook for Personnel and Payroll Offices

(formerly FPM Supplement 890-1). The

effective date of the change is also based on

FEHB regulations, primarily 5 CFR 890.306.

Similarly, when an employing office receives

an employee's SF 2817 (or the employee

otherwise requests a change in coverage), it

must decide whether or not to accept the

employee's change in life insurance coverage. 

By law, basic life insurance coverage is

automatic unless the employee waives it. 

Employees who have basic life insurance

coverage may elect or decline optional

coverage. The circumstances under which an

employee's previous waiver of basic life

insurance or declination of optional life

insurance may be cancelled and the effective

dates of changes in coverage are set forth in 

5 CFR parts 870, 871, 872, and 873. 

Additional guidance is provided in the FEGLI

Handbook for Personnel and Payroll Offices

(formerly FPM Supplement 870-1).

If the employing office decides that the

employee is not eligible to make the change,

it must give the employee a written

explanation of the reason the change in

enrollment or coverage was not allowed. The

written decision must include the address of

the office making reconsideration decisions,

the timeframe for requesting reconsideration

(30 days from the date of the written

notice), and a statement that a copy of the

written decision should be submitted with a

request for reconsideration. This written

explanation is considered the initial

decision.

 
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Deciding what

office will make

the

reconsideration

decisions

The office that makes the reconsideration

decisions must be at either a higher level or

in a different office than the office that

made the initial decision.

It is important that you notify the offices

that make initial decisions of the identity

of the office making reconsideration

decisions because they must include that

information when they give the initial

decision. 

 

Making decisions

about retroactive

corrections

In some cases, the law or regulations provide

for retroactive effective dates. In these

cases, there is no need for an employing

office to decide whether a retroactive

correction is appropriate.

Generally, however, changes are made

prospectively. That is, when the agency

decides an employee should have been allowed

to enroll or change enrollment at some time

in the past, it accepts an SF 2809 or SF 2817

from the employee making the change. Under

FEHB regulations, the SF 2809 is normally 

effective the first day of the pay period

beginning after the employing office receives

the SF 2809. In the case of the SF 2817, the

effective date depends on the election being

made.

In certain cases, the employing office may

consider an employee's request that the

change be made retroactive to an earlier

date, generally the date it would have been 

effective if he or she had been able to make

a timely election.

Exception: If the administrative error was

made before January 1, 1995, the employing

agency does not have the authority to make a

retroactive correction. Instead, the

employee must request a retroactive

correction from:

Office of Personnel Management

Retirement and Insurance Group

Office of Insurance Programs
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P.O. Box 436

Washington D.C. 20044

 

Effective dates 1. Life insurance. 

C The FEGLI law provides that basic life

insurance coverage is automatic unless

the employee waives it. Therefore, if

an agency discovers that an employee

should have been covered by basic life

insurance, but no withholdings were

made, the correction must be made

retroactively. 

C See section S4-7 of the FEGLI Handbook

for instructions on adjusting premium

errors.

C See subchapter S2 of the FEGLI Handbook

for additional information about 

effective dates of life insurance

coverage and changes in coverage.

2. Health benefits. See subchapter S7 of

the FEHB Handbook for information about

effective dates of health benefits

enrollments and changes in enrollment.

 

 

Some initial 

decisions 

cannot be 

overruled by 

reconsideration

Initial decisions that comply with the law

and regulations cannot be overruled by

reconsideration.

Example 1: 

OFEGLI approves the medical evidence

submitted by an employee who wants to

cancel a waiver of basic life insurance

and/or a declination of optional insurance. 

The employee then elects Option C--Family

insurance. The employing office denies the

election of Option C and the employee

requests reconsideration. The office

making the reconsideration decision cannot

overrule the employing office because

OFEGLI approval of medical evidence does

not allow an employee to elect Option C--

Family insurance.
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Example 2.

An employee has a child who dies within 60

days after birth. After the death of the

child, the employee elects Option C--Family

coverage based on the birth of the child. 

The employee requests that the election be

made retroactive to the child's birth. 

Although the employee could elect Option 

C--Family coverage within 60 days after the

birth of the child, the effective date of

the election is the day the employing

office receives the election. This initial

decision to deny a retroactive effective

date cannot be overruled by a

reconsideration decision. (Employees may

submit an election of Option C--Family

insurance before an anticipated event that

will add a family member to their household

--such as marriage or birth--so that it

will become effective when the event

occurs.)

Example 3.

An employee who had declined optional life

insurance coverage separates from his or

her position and is reemployed less than

180 days later. The employee elects

optional life insurance at the new agency. 

The employing office denies the election. 

This initial decision cannot be overruled

by reconsideration because previous waivers

and declinations remain in effect when an

employee goes from one agency to another

with a break in service of less than 180

days.

Example 4.

An employee lists parents who live with and

are dependent on the employee as family

members under his or her FEHB enrollment. 

The employing office denies coverage of the

parents. This initial decision cannot be

overruled by reconsideration because the

FEHB law does not provide for coverage of

an employee's parents as family members.

Although a correct initial decision cannot be
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overruled by a reconsideration decision, the

employee has the right to request

reconsideration so that the initial decision

can be reviewed to determine whether it is

correct.

 

Incontestability 

clause

See BAL 95-203 for information about

incontestability.

 

Agencies cannot 

make decisions

about payment

of claims

The reconsideration process applies only to

enrollment issues. Agencies cannot make

decisions about payment of claims.

Example 1.

An employee with Option C--Family has a

stillborn child. The employee asks the

agency to help him or her file a claim for

the Option C--Family benefits. The employing

office may explain that benefits are not

payable for stillborn children. 

Nevertheless, if the employee persists, the

agency must assist in the filing of the

claim. It is the responsibility of the

Office of Federal Employees' Group Life

Insurance (OFEGLI) to deny the claim.

Example 2.

An employee complains to his or her employing

office that his or her plan has refused to

pay a claim. The employing offices advises

the employee to follow the procedures set

forth in the plan's brochure regarding

disputed claims. There is no action the

employing office itself can take to bring

about the payment of the claim.

 

What is an equity 

 and good 

 conscience 

 determination?

Under the FEHB and FEGLI regulations, OPM has

retained its authority to make equity and

good conscience determinations. This

authority allows OPM to order a correction of

an administrative error, but it is not a part

of the administrative review process. The

administrative review process ends with the

agency's reconsideration.
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OPM does not intend to use its authority to

make equity and good conscience decisions

simply to "second guess" agency

reconsideration decisions. However, OPM, as

administrator of the FEHB and FEGLI Programs,

must have the ability to overrule an agency

decision that is obviously in disregard of

law and regulations and has serious adverse

consequences for the employee.

The circumstances that would give rise to an

order to correct an administrative error on

the basis of equity and good conscience are

rare. Normally, OPM will inform an employee

who asks OPM to overrule an agency's

reconsideration decision that the agency's

decision is final.

 

Sample letters Sample letters are attached as an aid to

offices making reconsideration decisions. 

Agencies may tailor these letters to meet

their specific needs.

Job Aid 1:

This sample letter may be used when an

employee requests reconsideration, but does

not send a written initial decision.

Job Aid 2:

This sample letter denies a reconsideration

request from an employee whose election to

change health benefits enrollment was not

based on an event allowing change in

enrollment.

Job Aid 3:

This sample letter denies a request to

overrule a FEGLI decision concerning

medical insurability.

 
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Job Aid 1: Sample letter instructing employee 

about obtaining an initial decision

(Name and address of employee)

Dear (employee's name):

This office does not make initial decisions concerning (health

benefits/life insurance) enrollments for employees of (Department

or Agency). That is the responsibility of your personnel office. 

You may request this office to reconsider your personnel office's

written decision refusing your election (to enroll or change your

health benefits enrollment) (to acquire or increase your life

insurance coverage). Since your personnel office has not yet

made its decision in writing, it is premature to request this

office to issue its reconsideration decision. If your personnel

office gives a negative written decision, you may request this

office to reconsider it within 30 calendar days from the date of

the decision. Please include a copy of the initial decision in

your request for reconsideration.

We are forwarding your request to your personnel office at the

address shown below so that they may make their initial decision. 

Your request has been forwarded to:

(name and address of personnel office 

responsible for initial decision)

Sincerely,
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Job Aid 2: Sample letter denying a request to 

change health benefits enrollment when there was 

no event allowing change

(Name and address of employee)

Dear (employee's name):

This is in response to your letter requesting that this office

reconsider your personnel office's initial decision to deny you

an opportunity to change your enrollment under the Federal

Employees Health Benefits (FEHB) Program. I am sorry, but I must

also deny your request.

As you may know, opportunities to enroll or change enrollment in

the FEHB Program are tied to the occurrence of certain events. 

The events that permit an employee to change enrollment and the

time limits for submitting an election to change enrollments are

listed in section 890.301 of title 5 of the Code of Federal

Regulations, as well as on Standard Form 2809, Health Benefits

Registration Form.

Every employee is allowed to change plans during open season and

there are many other events that allow change as well. It is

your responsibility to submit a timely election when a

permissible event occurs. Since your request to change your

enrollment was not received by your personnel office within the

timeframe for any event allowing you to change, I must concur

with your personnel office's initial decision.

This is your final administrative review concerning this matter. 

You have no further reconsideration rights.

Sincerely,
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Job Aid 3: Sample letter denying a request to 

overrule an OFEGLI decision 

concerning medical insurability

(Name and address of employee)

Dear (employee's name):

The Office of Federal Employees' Group Life Insurance (OFEGLI)

determines whether an applicant's proof of insurability is

acceptable based on medical underwriting standards. You do have

the right to an administrative reconsideration made by this

office of an initial decision made by your employing office

concerning your enrollment in the FEGLI Program. However, you do

not have the right to an administrative reconsideration of an

OFEGLI decision to deny coverage based on medical reasons.

If you have further questions regarding the denial of your

request, you or your physician may write to OFEGLI at 200 Park

Avenue, New York, NY 10166-0188.

This is your final administrative review concerning this matter. 

You have no further reconsideration rights.

 Sincerely,