H. R. 512
One Hundred Third Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Tuesday,
the twenty-fifth day of January, one thousand nine hundred and ninety-four
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; to provide for continuation of health
benefits coverage for certain individuals enrolled in health benefits plans adminis-
tered by the Office of the Comptroller of the Currency or the Office of Thrift
Supervision; and for other purposes.
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘FEGLI Living Benefits Act’’.
SEC. 2. OPTION TO RECEIVE ‘‘LIVING BENEFITS’’.
(a) IN GENERAL.—Chapter 87 of title 5, United States Code,
is amended by inserting after section 8714c the following:
‘‘§ 8714d. Option to receive ‘living benefits’
‘‘(a) For the purpose of this section, an individual shall be
considered to be ‘terminally ill’ if such individual has a medical
prognosis that such individual’s life expectancy is 9 months or
less.
‘‘(b) The Office of Personnel Management shall prescribe regula-
tions under which any individual covered by group life insurance
under section 8704(a) may, if such individual is terminally ill,
elect to receive a lump-sum payment equal to—
‘‘(1) the full amount of insurance under section 8704(a)
(or portion thereof designated for this purpose under subsection
(d)(4)) which would otherwise be payable under this chapter
(on the establishment of a valid claim)—
‘‘(A) computed based on a date determined under regu-
lations of the Office (but not later than 30 days after
the date on which the individual’s application for benefits
under this section is approved or deemed approved under
subsection (d)(3)); and
‘‘(B) assuming continued coverage under this chapter
at that time;
reduced by
‘‘(2) an amount necessary to assure that there is no increase
in the actuarial value of the benefit paid (as determined under
regulations of the Office).
‘‘(c)(1) If a lump-sum payment is taken under this section—
‘‘(A) no insurance under the provisions of section 8704
(a) or (b) shall be payable based on the death or any loss
of the individual involved, unless the lump-sum payment rep-
H. R. 512—2
resents only a portion of the total benefits which could have
been taken, in which case benefits under those provisions shall
remain in effect, except that the basic insurance amount on
which they are based—
‘‘(i) shall be reduced by the percentage which the des-
ignated portion comprised relative to the total benefits
which could have been taken (rounding the result to the
nearest multiple of $1,000 or, if midway between multiples
of $1,000, to the next higher multiple of $1,000); and
‘‘(ii) shall not be subject to further adjustment; and
‘‘(B) deductions and withholdings under section 8707, and
contributions under section 8708, shall be terminated with
respect to such individual (or reduced in a manner consistent
with the percentage reduction in the individual’s basic insur-
ance amount, if applicable), effective with respect to any
amounts which would otherwise become due on or after the
date of payment under this section.
‘‘(2) An individual who takes a lump-sum payment under this
section (whether full or partial) remains eligible for optional benefits
under sections 8714a–8714c (subject to payment of the full cost
of those benefits in accordance with applicable provisions of the
section or sections involved, to the same extent as if no election
under this section had been made).
‘‘(d)(1) The Office’s regulations shall include provisions regard-
ing the form and manner in which an application under this section
shall be made and the procedures in accordance with which any
such application shall be considered.
‘‘(2) An application shall not be considered to be complete
unless it includes such information and supporting evidence as
the regulations require, including certification by an appropriate
medical authority as to the nature of the individual’s illness and
that the individual is not expected to live more than 9 months
because of that illness.
‘‘(3)(A) In order to ascertain the reliability of any medical opin-
ion or finding submitted as part of an application under this section,
the covered individual may be required to submit to a medical
examination under the direction of the agency or entity considering
the application. The individual shall not be liable for the costs
associated with any examination required under this subparagraph.
‘‘(B) Any decision by the reviewing agency or entity with respect
to an application for benefits under this section (including one
relating to an individual’s medical prognosis) shall not be subject
to administrative review.
‘‘(4)(A) An individual making an election under this section
may designate that only a limited portion (expressed as a multiple
of $1,000) of the total amount otherwise allowable under this section
be paid pursuant to such election.
‘‘(B) A designation under this paragraph may not be made
by an individual described in paragraph (1) or (2) of section 8706(b).
‘‘(5) An election to receive benefits under this section shall
be irrevocable, and not more than one such election may be made
by any individual.
‘‘(6) The regulations shall include provisions to address the
question of how to apply section 8706(b)(3)(B) in the case of an
electing individual who has attained 65 years of age.’’.
H. R. 512—3
(b) TABLE OF SECTIONS.—The table of sections for chapter 87
of title 5, United States Code, is amended by inserting after the
item relating to section 8714c the following:
‘‘8714d. Option to receive ‘living benefits’.’’.
SEC. 3. EFFECTIVE DATE; OPEN SEASON AND NOTICE.
(a) EFFECTIVE DATE.—The amendments made by section 2 shall
take effect 9 months after the date of the enactment of this Act.
(b) OPEN SEASON; NOTICE.—(1) The Office of Personnel Manage-
ment shall prescribe regulations under which, beginning not later
than 9 months after the date of the enactment of this Act, and
over a period of not less than 8 weeks—
(A) an employee (as defined by section 8701(a) of title
5, United States Code) who declined or voluntarily terminated
coverage under chapter 87 of such title—
(i) may elect to begin, or to resume, group life insurance
and group accidental death and dismemberment insurance;
and
(ii) may make such other elections under such chapter
as the Office may allow; and
(B) such other elections as the Office allows may be made.
(2) The Office shall take such action as may be necessary
to ensure that employees and any other individuals who would
be eligible to make an election under this subsection are afforded
advance notification to that effect.
SEC. 4. FUNDING.
Notwithstanding section 8714(a)(1) of title 5, United States
Code, the Office of Personnel Management shall retain in the
Employees’ Life Insurance Fund such portion of premium payments
otherwise due as will, no later than September 30, 1995, perma-
nently reduce the contingency reserve established under the third
sentence of section 8712 of such title 5 by an amount equal to
the amount by which payments from the Employees’ Life Insurance
Fund during the fiscal year ending September 30, 1995, exceed
the payments that would have been paid had the amendments
made by this Act not been enacted.
SEC. 5. CONTINUATION 
OF 
HEALTH 
BENEFITS 
COVERAGE 
FOR
INDIVIDUALS ENROLLED IN A PLAN ADMINISTERED BY THE
OFFICE OF THE COMPTROLLER OF THE CURRENCY OR THE
OFFICE OF THRIFT SUPERVISION.
(a) ENROLLMENT IN CHAPTER 89 PLAN.—For purposes of the
administration of chapter 89 of title 5, United States Code, any
period of enrollment under a health benefits plan administered
by the Office of the Comptroller of the Currency or the Office
of Thrift Supervision before the termination of such plans on Janu-
ary 7, 1995, shall be deemed to be a period of enrollment in
a health benefits plan under chapter 89 of such title.
(b) CONTINUED COVERAGE.—(1) Any individual who, on January
7, 1995, is covered by a health benefits plan administered by the
Office of the Comptroller of the Currency or the Office of Thrift
Supervision may enroll in an approved health benefits plan
described under section 8903 or 8903a of title 5, United States
Code—
(A) either as an individual or for self and family, if such
individual is an employee, annuitant, or former spouse as
defined under section 8901 of such title; and
H. R. 512—4
(B) for coverage effective on and after January 8, 1995.
(2) An individual who, on January 7, 1995, is entitled to contin-
ued coverage under a health benefits plan administered by the
Office of the Comptroller of the Currency or the Office of Thrift
Supervision—
(A) shall be deemed to be entitled to continued coverage
under section 8905a of title 5, United States Code, for the
same period that would have been permitted under the plan
administered by the Office of the Comptroller of the Currency
or the Office of Thrift Supervision; and
(B) may enroll in an approved health benefits plan
described under section 8903 or 8903a of such title in accord-
ance with section 8905a of such title for coverage effective
on and after January 8, 1995.
(3) An individual who, on January 7, 1995, is covered as an
unmarried dependent child under a health benefits plan adminis-
tered by the Office of the Comptroller of the Currency or the
Office of Thrift Supervision and who is not a member of family
as defined under section 8901(5) of title 5, United States Code—
(A) shall be deemed to be entitled to continued coverage
under section 8905a of such title as though the individual
had, on January 7, 1995, ceased to meet the requirements
for being considered an unmarried dependent child under chap-
ter 89 of such title; and
(B) may enroll in an approved health benefits plan
described under section 8903 or 8903a of such title in accord-
ance with section 8905a for continued coverage effective on
and after January 8, 1995.
(c) TRANSFERS TO THE EMPLOYEES HEALTH BENEFITS FUND.—
The Office of the Comptroller of the Currency and the Office of
Thrift Supervision shall transfer to the Employees Health Benefits
Fund established under section 8909 of title 5, United States Code,
amounts determined by the Director of the Office of Personnel
Management, after consultation with the Office of the Comptroller
of the Currency and the Office of Thrift Supervision, to be necessary
to reimburse the Fund for the cost of providing benefits under
this section not otherwise paid for by the individuals covered by
this section. The amounts so transferred shall be held in the Fund
and used by the Office in addition to amounts available under
section 8906(g)(1) of such title.
(d) ADMINISTRATION AND REGULATIONS.—The Office of Person-
nel Management—
(1) shall administer the provisions of this section to provide
for—
(A) a period of notice and open enrollment for individ-
uals affected by this section; and
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(B) no lapse of health coverage for individuals who
enroll in a health benefits plan under chapter 89 of title
5, United States Code, in accordance with this section;
and
(2) may prescribe regulations to implement this section.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.