OPM issues proposed rule governing access to Federal Employee Health Benefits for tribal employers and employees

The U.S. Office of Personnel Management (OPM) published a proposed rule in the FEDERAL REGISTER today, August 31, 2016, governing access to Federal Employee Health Benefits (FEHB) for tribal employers and employees under section 409 of the Indian Health Care Improvement Act (IHCIA), as amended by section 10221 of the Affordable Care Act. According to the preamble, the proposed rule is intended to codify existing guidance and to adopt the FEHB program for Federal employees with “slight variations to meet the needs of the tribal population.” The FEDERAL REGISTER notice may be found here:

Comments are due October 31, 2016.

The proposed regulations would incorporate statutory eligibility provisions that extend the right to offer FEHB coverage to any tribe, tribal organization, or urban Indian organization carrying out at least one program under the Indian Self-Determination and Education Assistance Act (ISDEAA) or Title V of the IHCIA. See 25 U.S.C. § 1647b. However, under the proposed regulations, as long as a tribal employer purchases FEHB coverage for at least one “billing unit” that carries out at least one program under the ISDEAA or IHCIA, that tribal employer would also be entitled to purchase FEHB coverage for other billing units regardless of whether those other billing units carry out any programs under the ISDEAA or IHCIA. Tribal employers that elect to purchase FEHB coverage for their tribal employees must contribute a share of the premium that is at least equivalent to what the Federal Government contributes for Federal employees, but would be permitted to vary their contribution amount by enrollment type or by billing unit.

Consistent with existing FEHB and federal tax standards, the proposed regulations would define the term “tribal employee” to mean a common law employee of a tribal employer. Certain tribal employees, such as employees whose employment is limited to one year or less and employees expected to work less than 6 months in one year, would be excluded. Eligible tribal employees would have the same plan options and be entitled to select self only, self plus one, or self and family enrollment to the same extent as Federal employees in the same geographic area.

In order to purchase FEHB coverage, the proposed regulations would require tribal employers to enter into an agreement with OPM confirming the tribal employer’s eligibility and setting out various conditions of participation. These conditions include, among several others: agreement by the tribal employer not to offer alternate tribal employer-sponsored health insurance coverage to FEHB-eligible employees concurrently with FEHB; acknowledgement that the tribal employer will be subject to Federal audit with respect to FEHB participation; an agreement to establish or identify an independent dispute resolution panel to adjudicate employee disputes; and agreement that the tribal employer will notify OPM if it ceases to carry out at least one program under the ISDEAA or title V of the IHCIA. Responsibilities of tribal employers administering FEHB would also include eligibility determinations, enrollment, and notification requirements.

Among other things, the proposed regulations would also codify procedures and rules for payment; revocation and re-election of purchase of coverage; employee eligibility; enrollment and cancellation or termination of employee coverage; temporary extension of coverage and conversion to individual policy; and enrollment and eligibility appeal rights.

Please let us know if we may provide additional information or assistance regarding the OPM proposed rule.