With the substantial number of federal employees being subjected to reductions in force (RIFs), taking early retirement under the Voluntary Early Retirement Authority (VERA), or resigning or retiring early under the deferred resignation program, the issue arises as to what happens to employees’ long term care benefits under the Federal Employees Long-Term Care Insurance Program (FLTCIP) in that situation.
FLCTIP is ultimately governed by a statutes (5 U.S.C. Chapter 90), which cannot be modified without action by Congress, although OPM is authorized to issue implementing regulations (which it has done in 5 C.F.R. Part 875). Under those rules, separating employees are permitted to keep their FLTCIP coverage even if they are not immediately retirement, so long as they continue to pay premiums. See, e.g., Long Term Care | BENEFEDS (at “What happens to my FLTCIP coverage if I leave federal service?”). This differs significantly from other federal employee benefit programs, such as health insurance, life insurance and dental/vision insurance, as previously discussed in this blog, where non-retirees have to use more complex methods to retain their coverage post-separation.
For individuals whose FLTCIP coverage is terminated (for example, due to not paying premiums), the FLTCIP program is supposed to provide written notice of the cutoff after a 30-day grace period. It is possible to request reinstatement without underwriting (that is, without a new heath examination by the insurer to determine if the individual meets health standards for insurance coverage) if the lapse was due to “cognitive impairment or loss of functional capacity” during the grace period which prevented premiums from being paid—but the request would have to occur within 6 months of the plan terminating; outside that exception, the request (with a new underwriting determination) would have to be made within 12 months of the plan terminating. See 5 C.F.R. § 875.413. If the reinstatement rules do not apply, then reenrollment would have to await annuitant status or rehire as a federal employee. See 5 C.F.R. §§ 875.201, 875.202. However, OPM has suspended new FLTCIP enrollments (as noted on its website, as well as on the website for the program).
If you are a federal employee facing a RIF or separation under a VERA or the deferred resignation program, and wish to discuss your rights, consider contacting Gilbert Employment Law to request an initial consultation.