§9003 Contracting authority

Summary

The Office of Personnel Management (OPM) must hire one or more qualified insurance companies to offer group long-term care plans without using the usual competitive-bid rules. OPM must pick contractors based on qualifications, price, and fair competition. Each contract must spell out the benefits, the premiums and any rules about changing them, the enrollment rules, and any other agreed terms. Premiums must fairly match the cost of benefits and cannot be changed during the contract unless both OPM and the insurer agree. Contracts cannot be automatically renewed. Insurers must pay benefits when the contract says they must. They must have quick internal procedures to handle claims disputes and offer independent third-party review if needed. Decisions about who is eligible can be reviewed only as the contract allows. For disputes between an insurer and OPM, appeals go to a board of contract appeals named by the OPM Director, and federal district courts share original jurisdiction with the U.S. Court of Federal Claims for certain actions under 41 U.S.C. 7104(b)(1). OPM or a reviewer may not change the contract terms. Contracts last 7 years unless ended earlier, and enrollees’ rights continue until their coverage ends or a successor contract starts. Within 180 days after OPM receives the program’s second report, the President must send Congress a recommendation on whether to continue, end, or change the program, and OPM may not rebid coverage that would start after the 7-year period during the 180-day review. Coverage cannot be ended because someone leaves government service, loses qualified-relative status, or—if an employee or service member is furloughed during a funding lapse—because premiums were not paid due to that lapse.