§ 890.1608 - Disenrollment, removal, termination, cancellation, and suspension.

§ 890.1608 Disenrollment, removal, termination, cancellation, and suspension.

(a) Enrollment in FEHB plan terminates prior to the initial PSHB contract year. For individuals who are eligible to enroll under this subpart pursuant to § 890.1603(a), enrollment in an FEHB plan and coverage of the enrollee and covered family members under that FEHB plan will terminate at the end of the contract year preceding the initial contract year.

(1) Coverage under

a

an FEHB plan will remain available for an eligible family member who is or becomes covered as a member of family of

a

an FEHB plan enrollee who is not eligible for a PSHB plan pursuant to § 890.1603(a)(1) or (2).

(2) Coverage as a family member under an FEHB plan will remain available for a Postal Service employee or Postal Service annuitant who is or becomes covered under their family member's FEHB enrollment. A Postal Service annuitant's or Postal Service employee's family member who meets the eligibility requirements for their own enrollment in an FEHB plan will remain eligible to enroll in an FEHB plan.

(3) Individuals whose coverage is terminated under this paragraph (a) are not eligible for temporary continuation of coverage under subpart K of this part pursuant to § 890.1103(b).

(b) Disenrollment and removal from enrollment: Postal Service Medicare covered annuitants and Medicare covered members of family not enrolled in Medicare Part B. An individual who is required to be enrolled in Medicare Part B and is not enrolled in Medicare Part B will not be disenrolled or removed from PSHB coverage immediately and will be given one opportunity to remain enrolled in or covered by PSHB if they enroll or reenroll in Medicare Part B during their next available Medicare enrollment period, which may be the next Medicare General Enrollment Period, except that an individual who was excepted from the Medicare Part B requirement pursuant to § 890.1604(d)(1)(iii) or (d)(2)(ii) must enroll not later than the end of the Medicare General Enrollment Period beginning January 1 of the following calendar year. Failure to enroll or reenroll in Medicare Part B at the next enrollment period may result in disenrollment from PSHB or removal from coverage under a PSHB enrollment. If disenrolled, a Postal Service annuitant will not be permitted to reenroll in PSHB, as described in paragraph (b)(5) of this section, and a family member who is removed from coverage under a PSHB enrollment, may have their PSHB coverage reinstated only as described in paragraph (b)(9) of this section.

(1) Unless the individual qualifies for an exception under § 890.1604(c), a Postal Service Medicare covered annuitant may be disenrolled and a Medicare covered member of family may be removed from PSHB coverage if not enrolled in Medicare Part B either:

(i) By the end of their Medicare initial enrollment period or applicable Medicare special enrollment period; or,

(ii) Any time after January 1, 2025, that the PSHB Carrier, the Postal Service, or OPM determines that the individual was required to be enrolled but has not enrolled in Medicare Part B.

(2) A Postal Service Medicare covered annuitant will not be disenrolled from PSHB and a Medicare covered member of family will not be removed from PSHB coverage in a case where that individual was not informed of their obligation to enroll in Medicare Part B, or it would be against equity and good conscience to remove the individual. In such a case, that individual will be permitted to stay enrolled in or covered by PSHB if they enroll in Medicare during their next enrollment opportunity, such as the next Medicare general enrollment period.

(3) A Postal Service Medicare covered annuitant will not be disenrolled and a Medicare covered member of family will not be removed from PSHB coverage due to not being enrolled in Medicare Part B if such individual qualifies for one of the exceptions in § 890.1604(c).

(4) A Postal Service Medicare covered annuitant may not be disenrolled if they have suspended PSHB enrollment while enrolled in a Medicare-sponsored plan under section 1833, 1876, or 1851 of the Social Security Act as described in § 890.304(d)(2).

(5) Disenrollment of a Postal Service Medicare covered annuitant from a PSHB plan under this section shall be considered a termination with entitlement of the enrollee and PSHB their covered family members to a 31-day temporary extension of coverage and the right of conversion under § 890.401, except as provided at paragraph (b)(5)(ii) of this section.

(i) A Postal Service annuitant will have no further opportunity to reenroll in a PSHB plan. Disenrollment of a Postal Service annuitant will also result in the removal of covered family members from PSHB coverage.

(ii) Disenrollment or removal from coverage under an enrollment will be prospective in all cases except where fraud or intentional misrepresentation of material fact is found, in which case the individual's coverage will be terminated retroactively, as applicable, and no right to a 31-day temporary extension of coverage or to conversion under § 890.401 will be available.

(iii) Disenrollment or removal under this section will occur only after a notice process under § 890.1612, if applicable, is completed and an initial decision to disenroll or remove, subject to reconsideration under § 890.1607(b), is issued.

(6) An individual who is disenrolled from Medicare Part B, where the individual is required to be enrolled in Medicare Part B and does not have an exception under this subpart, will be issued an initial decision disenrolling them from PSHB or removing them from coverage under a PSHB enrollment at the time OPM becomes aware of the Medicare disenrollment. Individuals disenrolled or removed from PSHB coverage will be entitled to a 31-day temporary extension of coverage and rights to conversion.

(7) Within 60 days of OPM's initial decision, a Postal Service Medicare covered annuitant or Medicare covered member of family, as applicable, may request reconsideration of OPM's initial decision to disenroll or remove the individual from PSHB coverage. OPM will notify the carrier when a request for reconsideration of the decision to disenroll or remove the individual from the enrollment is made. The time limit for filing may be extended as noted in § 890.1607.

(8) If the Postal Service Medicare covered annuitant provides acceptable proof of PSHB eligibility subsequent to disenrollment which renders the disenrollment inappropriate, the enrollment shall be reinstated retroactively so that there is no gap in enrollment, as appropriate. A Postal Service Medicare covered annuitant's PSHB enrollment cannot be reinstated after disenrollment from a PSHB plan based on failure to enroll in, disenrolling from, or being disenrolled from Medicare Part B, except that a one-time opportunity as set forth at § 890.1608(b) may be available if the Postal Service annuitant has not previously invoked and used it.

(9) If the Postal Service Medicare covered member of family, who is required to be enrolled in Medicare Part B and is removed from a Postal Service Medicare covered annuitant's PSHB enrollment because the family member failed to enroll in, disenrolls from, or is disenrolled from Medicare Part B, the family member's PSHB coverage may be reinstated. Reinstatement of the family member's PSHB coverage will be permitted only if the Postal Service Medicare covered annuitant's PSHB enrollment continues, and only if proof of the family member's Medicare Part B enrollment which renders the removal inappropriate, is provided by the Postal Service Medicare covered annuitant or Medicare covered member of family, as applicable. The family member's PSHB coverage will be reinstated upon request by the Postal Service Medicare covered annuitant to reinstate the family member's PSHB coverage subsequent to removal, at the Postal Service Medicare covered annuitant's option, as follows:

(i) Prospectively, within 60 days of the Medicare covered family member gaining coverage under Medicare Part B, or

(ii) Retroactively to the date of termination of PSHB coverage, so that there is no gap in coverage, provided that the proof demonstrates the family member was continuously enrolled in Medicare Part B since that date and subsequent to removal, as appropriate.

(c) Ineligibility under this subpart. The PSHB Carrier, Postal Service, other applicable employing offices, or OPM, as appropriate, may take action to disenroll ineligible individuals from enrollment or remove covered members of family from an enrollment pursuant to § 890.308.

(d) Removal due to fraud or misrepresentation. Pursuant to § 890.308(e)(3) and (f)(3), fraud or intentional misrepresentation of the fact of non-enrollment in, or disenrollment from, Medicare Part B may be grounds for retroactive disenrollment and removal to the date of loss of eligibility.

(e) Cancellation of PSHB in writing to the Postal Service due to lack of Medicare coverage. As required by 5 U.S.C. 8903c(g)(3)(D), the Postal Service Medicare covered annuitant or a Medicare covered member of family may cancel coverage under this subpart in writing to the Postal Service because the individuals choose not to enroll in or to disenroll from Medicare Part B. In such a case, PSHB enrollment or coverage under this subpart will be cancelled as described in paragraphs (e)(1) through (4) of this section.

(1) The cancellation of a Postal Service Medicare covered annuitant's PSHB plan enrollment—

(i) Is effective as of the last day of the last pay period in which the Postal Service Medicare covered annuitant was enrolled in Medicare Part B, or the last day of the last pay period before the individual became a Postal Service Medicare covered annuitant; and

(ii) Cancels the PSHB plan coverage of any family members covered under a self plus one or self and family enrollment, subject to applicable provisions at § 890.1609.

(2) The cancellation of a Medicare covered member of family's PSHB plan coverage is effective the last day in which the Medicare covered family member was enrolled in Medicare Part B, or the last day before the individual became eligible for Medicare but did not enroll.

(3) When writing to notify the Postal Service that a Medicare covered member of family will not enroll in or will disenroll from Medicare Part B, the Postal Service Medicare covered annuitant may elect to decrease their PSHB plan enrollment type as described in § 890.306(e).

(4) Cancellation of PSHB enrollment or coverage under this paragraph (e) shall be treated as a termination and an enrollee or covered family member whose enrollment or coverage is canceled is entitled to a 31-day temporary extension of coverage and right of conversion in accordance with § 890.401.

(f) Temporary extension of coverage and conversion. A Postal Service employee, Postal Service annuitant, or their covered family member whose enrollment or coverage is terminated other than by cancellation of the enrollment or discontinuance of the plan, in whole or part, is entitled to a 31-day temporary extension of coverage and right of conversion in accordance with § 890.401.

[88 FR 20403, Apr. 6, 2023, as amended at 89 FR 85029, Oct. 24, 2024]