The United States Office of Personnel Management (OPM) has just issued a final rule to amend the Federal Employees Health Benefits (FEHB) Program regulations to reaffirm the exempt nature of the FEHBP plan as not subject to State laws. (see OPM FEHPB conditional payment regs). 5 U.S.C. 8902(m)(1), provides: “The terms of any contract under this chapter which relate to the nature, provision, or extent of coverage or benefits (including payments with respect to benefits) shall supersede and preempt any State or local law, or any regulation issued there under, which relates to health insurance or plans”
The conditional nature of FEHB Program benefits and benefit payments was again reiterated as was the express requirement that Plans have express language in their contracts. By issuing a final rule in this fashion, OPM is exercising its rule making authority under 5 U.S.C. 8913 to ensure that carriers enjoy the full subrogation and reimbursement rights provided for under their contracts thus overruling any Courts opinions such as Empire Healthchoice Assurance, Inc. v. McVeigh which sought to apply state laws to hinder the administration of FEHBP plans.