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Oregon Bulletin

November 1, 2013

Oregon Health Authority, Public Employees’ Benefit Board, Chapter 101

Rule Caption: Amends rules for conformance with federal healthcare reform and Board By-Laws; clarifies language.

Adm. Order No.: PEBB 1-2013

Filed with Sec. of State: 9-24-2013

Certified to be Effective: 9-24-13

Notice Publication Date: 9-1-2013

Rules Amended: 101-010-0005, 101-020-0020, 101-020-0025, 101-020-0066, 101-030-0005, 101-030-0070

Subject: Amends rules for conformance with federal healthcare reform and Board By-Laws; clarifies language.

Rules Coordinator: Cherie Taylor—(503) 378-6296

101-010-0005

Definitions

Unless the context indicates otherwise, as used in OAR chapter 101, divisions 1 through 60, the following definitions will apply:

(1) “Actively at work” for medical and dental insurance coverage means an active eligible employee at work, in paid status and scheduled for work during the month. Optional plan policies or plan certificates contain “actively at work” criteria specific to the individual plan.

(2) “Active Participation” in reference to a Flexible Spending Account (FSA) means an eligible employee currently enrolled in the plan and who each month deposits the required dollar contribution in the account.

(3) “Affidavit of Dependency” means a notarized document that attests a dependent child meets the criteria for a dependent child under OAR 101-015-0011.

(4) “Affidavit of Domestic Partnership” means a notarized document that attests the eligible employee and one other individual meet the criteria in OAR 101-015-0026(2).

(5) “Agency” means a PEBB participating organization such as an individual state of Oregon public agency, semi-independent agency, and individual OUS University.

(6) “Benefit amount” means the amount of money paid by a PEBB participating organization for the purchase of core benefit plans on behalf of active eligible employees. PEBB does not determine the benefit amount.

(7) “CBIW” means Continuation of Benefits for Injured Workers.

(8) “Certificate of Registered Domestic Partnership” means the certificate issued by an Oregon county clerk to two individuals of the same sex after they file a Declaration of Domestic Partnership with the county clerk.

(9) “COBRA” means the federal Consolidated Omnibus Reconciliation Act of 1985.

(10) “Core Benefits” means the specific benefit plans that a PEBB employer pays a benefit amount for plan coverage of active eligible employees (e.g., medical, dental and employee basic term life coverage).

(11) “Dependent Care Flexible Spending Account” or “Dependent Care FSA” means the Dependent Care Assistance Program (DCAP) that PEBB has adopted in accordance with section 129 of the Internal Revenue Code.

(12) “Dependent child” means a child that satisfies the conditions of OAR 101-015-0011, as applicable.

(13) “Domestic partner” means an eligible employee’s partner in a registered domestic partnership under Chapter 99 Oregon Laws 2007 or unmarried partner of the same or opposite sex that meets the requirements as outlined in OAR 101-015-0026(2).

(14) “Eligible employee” means an individual eligible to enroll in PEBB plan benefits and includes:

(a) “Active eligible employee” means an employee of a PEBB participating organization, including state officials, in exempt, unclassified, classified and management service positions who are expected to work at least 90 days; and who work at least half-time or are in a position classified as job share. These employees are eligible for PEBB core benefits and some optional plans depending on their job classification.

(b) “Retired eligible employee” means a previously active eligible employee, who meets retiree eligibility as defined in OAR 101-050-0005. A retired eligible employee is eligible to self-pay for only the benefit plans established in division 50 of this chapter.

(c) “Other eligible employee” means an individual of a specific self-pay group as established by ORS 243.140 and 243.200. These groups are eligible only for medical or dental benefits as approved by PEBB.

(15) “Family member” means a spouse, domestic partner, or a qualifying child.

(16) “FMLA” means the federal Family Medical Leave Act.

(17) “FTE” means full time equivalent job position.

(18) “Grandchild Affidavit” means a notarized document that attests a grandchild of an eligible employee, spouse, or domestic partner meets the eligibility criteria for PEBB grandchild coverage as defined in OAR 101-015-0011(1)(B).

(19) “Half-time” means an eligible employee who works less than full time but at least:

(a) Eighty paid regular hours per month; or

(b) 0.5 FTE for unclassified OUS employees; or

(c) Eighty paid hours per month and is employed at a minimum of .5 FTE, for Oregon Judicial Department employees; or

(d) As defined by collective bargaining.

(20) “Health Flexible Spending Account” or “Health FSA” means the health flexible spending arrangement that PEBB has adopted in accordance with the Internal Revenue Code.

(21) “Imputed value” means a dollar amount established yearly for an insurance premium at fair market value. The IRS or the Oregon Department of Revenue may view the imputed value as taxable income. The imputed value dollar amount is added to the eligible employee’s taxable wages.

(22) “Ineligible individual” means an individual who does not meet the definition of an eligible employee, spouse, domestic partner, or dependent child as defined in PEBB administrative rules.

(23) “Job share” means two eligible employees sharing one full time equivalent position. Each eligible employee’s percentage of the total position determines the benefit amount the employee receives. The monthly benefit percentage amount remains the same regardless of each individual’s hours worked per month. Job share employees may not donate their portion of the benefit amount to the job share co-worker.

Example 1: John and Jill share one full time equivalent position. When they were hired into the position in July, John’s percentage of the total position was 40 percent; Jill’s percentage was 60 percent. John worked 70 percent of the available hours in September. John’s benefit amount percentage for September remains at 40 percent. Jill’s benefit amount percentage remains at 60 percent.

(24) “Midyear plan change event” means an event that provides an eligible employee an exception to the general plan year irrevocability rule that applies to PEBB plan elections. Permissible midyear events fall into three broad groups with allowable subgroups: (1) change in status (QSC), (2) cost or coverage changes, or (3) other laws or court orders.

(25) “OFLA” means the Oregon Family Leave Act.

(26) “OSPS” means the Oregon State Payroll System.

(27) “OUS” means the Oregon University System.

(28) “Open enrollment period” means an annual period chosen by PEBB when both active and other eligible employees and COBRA participants can make benefit plan changes or elections for the next plan year.

(29) “Optional plans” means, but is not limited to:

(a) Dependent life insurance;

(b) Employee, spouse, or domestic partner optional life insurance;

(c) Accidental Death & Dismemberment (AD&D) insurance;

(d) Short Term Disability insurance;

(e) Long Term Disability insurance;

(f) Flexible Spending Accounts (Health and Dependent Care); and

(g) Long Term Care insurance.

(30) “Paid regular status” means in current payroll status, and receiving payment for work time. Paid regular status includes the use of vacation, sick, holiday, or personal leave accruals, compensatory time, or other employer approved paid status such as furlough.

(31) “Pebb.benefits” means the electronic benefit management system sponsored by PEBB. The system allows electronic enrollment and termination of an eligible individual’s benefit plans, personal information updates, and the transmittal of data to plans, payroll centers, and third party administrators.

(32) “PEBB participating organization” means a state agency, board, commission, university, or other entity that receives approval to participate in PEBB benefit plans.

(33) “Plan change period” means a period chosen by PEBB when retirees can make limited benefit plan changes.

(34) “Plan year” means a period of twelve consecutive months. PEBB’s plan year is a calendar year.

(35) “Qualified status change” (QSC) means a change in family or work status that allows or requires limited mid-year changes of benefit plans consistent with the individual event.

(36) “Rescission” means a cancellation or discontinuance of coverage that has a retroactive effect. A cancellation or discontinuation of coverage that is prospective only, or one that is effective retroactively but is attributable to nonpayment of premiums or contributions, is not a rescission.

(37) “Reinstate” means to reactivate previous benefits and enrollments, if they are available, to an eligible employee returning to eligible status within a specific time frame. Reinstated enrollment does not include FSAs or Long Term Care.

(38) “Spouse” means a person of the opposite sex who is a husband or wife. A relationship recognized as a marriage in another state between two opposite sex partners will be recognized in Oregon even though such a relationship would not be a marriage if the same facts had been relied upon to create a marriage in Oregon. The definition of spouse does not include a former spouse and a former spouse does not qualify as a dependent.

Stat. Auth.: ORS 243.061 - 243.302

Stats. Implemented: ORS 243.061 - 302, 659A.060 - 069, 743.600 - 602, 743.707

Hist.: PEBB 1-1999, f. 12-8-99, cert. ef. 1-1-00; PEBB 1-2000, f. 11-15-00, cert. ef. 1-1-01; PEBB 1-2001, f. & cert. ef. 9-6-01; PEBB 1-2002, f. 7-30-02, cert. ef. 8-1-02; PEBB 1-2003, f. & cert. ef. 12-4-03; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 3-2004, f. & cert. ef. 10-7-04; PEBB 3-2005, f. 8-31-05, cert. ef. 9-1-05; PEBB 2-2006(Temp), f. & cert. ef. 12-14-06 thru 6-12-07; PEBB 1-2007(Temp), f. & cert. ef. 6-11-07 thru 12-8-07; PEBB 2-2007, f. 9-28-07, cert. ef. 10-1-07; PEBB 1-2008(Temp), f. & cert. ef. 2-4-08 thru 8-1-08; PEBB 2-2008, f. & cert. ef. 8-1-08; PEBB 3-2009, f. 9-29-09 cert. ef. 10-1-09; HLA 4-2010, f. & cert. ef. 5-18-10; PEBB 1-2010(Temp), f. & cert. ef. 6-1-10 thru 11-28-10; PEBB 7-2010, f. 12-10-10, cert. ef. 1-1-11; PEBB 1-2013, f. & cert. ef. 9-24-13

101-020-0020

Newborn and Adopted Child Enrollment

(1) An eligible employee’s biological newborn child receives PEBB-sponsored medical and dental insurance coverage under the newborn’s own coverage from the moment of birth through the first 31 days of life without completing PEBB forms. To continue coverage beyond the first 31 days of coverage the eligible employee must enroll the newborn child to their benefit plans within 30 days from the date of birth by submitting the correct enrollment update forms.

(2) An eligible employee’s newly adopted child receives PEBB-sponsored medical and dental insurance coverage under the adopted child’s own coverage from the date of the adoption decree or date of placement for adoption through the first 31 days without completing PEBB forms. To continue coverage beyond the first 31 days of coverage the eligible employee must enroll the adopted child to their benefit plans within 30 days from the date of the decree or placement by submitting the correct enrollment update forms. Placement for adoption requires the submission of an Affidavit of Dependency with enrollment forms with legal documentation of the placement.

(a) The eligible employee must submit the adoption agreement or placement agreement with the enrollment forms to the agency. Upon adoption completion, a copy of the finalized adoption document must be submitted to the employee’s agency.

(b) Claims payment will not occur prior to the adoption decree or placement for adoption date.

(3) A request to enroll a biological newborn or newly adopted child beyond 30 days of the date of birth, adoption decree, or placement for adoption is late enrollment as specified in OAR 101-020-0040.

Stat. Auth.: ORS 243.061 - 302

Stats. Implemented: ORS 243.061-302, 659A.060-069, 743.600-602 & 743.707

Hist.: PEBB 1-1999, f. 12-8-99, cert. ef. 1-1-00; PEBB 1-2000, f. 11-15-00, cert. ef. 1-1-01; PEBB 1-2001, f. & cert. ef. 9-6-01; PEBB 1-2002, f. 7-30-02, cert. ef. 8-1-02; PEBB 1-2003, f. & cert. ef 12-4-03; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 3-2004, f. & cert. ef. 10-7-04; PEBB 1-2005, f. & cert. ef. 4-14-05; PEBB 2-2007, f. 9-28-07, cert. ef. 10-1-07; PEBB 2-2008, f. & cert. ef. 8-1-08; PEBB 1-2013, f. & cert. ef. 9-24-13

101-020-0025

Removing an Ineligible Individual from Benefit Plans

(1) All eligible employees have 30 days from the date a spouse, domestic partner, or dependent child loses eligibility to remove the individual from PEBB coverage. When agencies receive update forms to remove ineligible individuals within the required 30 days coverage terminations are prospective, ending the last day of the month following agency receipt of the appropriate forms.

Example: Ann’s divorce is final on June 6 and she submits the update form to remove her ex spouse to her agency on June 22. The agency terminates Ann’s former spouse PEBB coverage effective June 30. Ann’s former spouse will receive a COBRA notice of availability.

(2) An employee’s failure to report a spouse, domestic partner, or dependent child’s loss of eligibility within 30 days of the event is an intentional misrepresentation of a material fact of enrollment by the employee. PEBB will rescind all coverage back to the last day of the month and plan year when eligibility was lost. Ineligible individuals removed more than 60 days from the eligibility loss date will receive a COBRA unavailability letter due to the employee’s late notification.

(a) At an agency’s discretion, an employee may become liable to repay the agency for premiums paid by the agency while the individual was ineligible.

(b) An employee may become liable for repayment of insurance claims incurred and paid by a plan for the ineligible individual according to contract agreements between PEBB and the plan.

(c) An employee may face disciplinary action by an agency.

Example: Ann’s divorce is final on June 6. Ann submits her update form to her agency October 10. The agency forwards the update forms to PEBB. PEBB terminates the ineligible individual’s coverage the last day of the month that the divorce was final. The ex spouse will receive a COBRA unavailability letter.

(3) Premium refunds to agencies:

(a) Premium refunds for rescinded coverage may be available according to PEBB’s contract agreement with each plan.

(b) An agency will not receive a premium equivalent refund from a PEBB self-insured plan for an ineligible individual whose coverage is rescinded.

(3) A plan may remove from coverage or deny the claims of an eligible employee, a family member, domestic partner, or domestic partner’s dependent child because of fraud, intentional misrepresentation of a material fact, eligibility violations, or policy term violations. Violations include but are not limited to, fraud, material misrepresentation, or concealment. When a plan removes an employee from coverage for violations:

(a) The employee may choose, as a midyear plan change, an alternative plan to replace the terminated plan. If no alternative plan is available, there is no coverage.

(b) The plan may retain all premiums paid and has the right to recover from the employee, the benefits paid as a result of such wrongful activity that are in excess of the premiums.

(c) The plan may deny future enrollments of the individual.

(4) When discovered, PEBB may rescind coverage for individuals identified as ineligible to the end of the month that eligibility is lost, whether or not requested by the employee within the 30 day period.

Example 1: Cindy’s divorce was final September 14. Cindy did not submit update forms; instead, she removed her spouse’s coverage during open enrollment in October. Open Enrollment removal by the employee will result in continued coverage for the former spouse until December 31 of the current plan year. PEBB and the agency identify and verify the former spouse as ineligible for coverage early in December. PEBB retro terminates the ex-spouse’s coverage to September 30. The ex spouse receives a notice of COBRA unavailability due to the late employee notification. Cindy may be responsible for claims paid or agency premiums paid for her former spouse after September 30.

Stat. Auth.: ORS 243.061 - 302

Stats. Implemented: ORS 243.061-302, 659A.060-069, 743.600-602 & 743.707

Hist.: PEBB 1-1999, f. 12-8-99, cert. ef. 1-1-00; PEBB 1-2002, f. 7-30-02, cert. ef. 8-1-02; PEBB 1-2002, f. 7-30-02, cert. ef. 8-1-02; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 3-2004, f. & cert. ef. 10-7-04; PEBB 2-2007, f. 9-28-07, cert. ef. 10-1-07; PEBB 2-2008, f. & cert. ef. 8-1-08; PEBB 3-2009, f. 9-29-09 cert. ef. 10-1-09; PEBB 7-2010, f. 12-10-10, cert. ef. 1-1-11; Suspended by PEBB 1-2011(Temp), f. & cert. ef. 3-9-11 thru 8-4-11; PEBB 2-2011(Temp), f. & cert. ef. 8-5-11 thru 1-31-12; Administrative correction 2-24-12; PEBB 1-2013, f. & cert. ef. 9-24-13

101-020-0066

Public Employees’ Benefit Board Appeal Procedure

(1) Eligible employees may submit appeal requests to PEBB concerning PEBB policy, eligibility, or plan enrollments. PEBB staff and the Board Appeals Subcommittee use relevant state and federal regulations, policy, PEBB’s documented Internal Revenue Code (IRC) 125 Cafeteria plan, and Oregon Administrative Rules to provide appeal decisions.

(2) PEBB does not accept appeals related to contracted plans or plan administrators, such as but not limited to medical, dental, life, disability, COBRA, and long term care, services, decisions, or claims. The Board’s Appeal Committee may hear appeals concerning benefit design.

(3) If PEBB rescinds plan coverage due to an individual’s ineligibility for coverage, the ineligible individual may appeal the rescission decision to PEBB using this rule. Until the appeal process for the rescission is exhausted the individual’s premium and claim payments will continue as if the rescission had not occurred. Upon final appeal determination and the rescission is upheld the employee will be responsible to pay all claims and premium payments paid by the Plan or PEBB during the period of ineligibility.

(4) Eligible Employees, or individuals who believe they received an incorrect or unfair decision from PEBB staff, an employing agency, retiree plan administrator, or an individual notified of a rescission have three levels of PEBB appeal.

(a) Level One: An eligible employee who believes he or she received an incorrect or unfair decision from PEBB, an employing agency, or retiree plan administrator, or an individual notified of a rescission may appeal the decision to PEBB. The appeal must be within 30 days the decision or action considered by the employee or individual as unfair or incorrect.

(A) The employee or individual must submit the appeal to PEBB using the correct forms and provide any supporting documentation for the appeal.

(B) A PEBB Benefit Analyst will review the appeal documents and may request additional information from the employee, individual, employer, or plan. Information requested from the employee must be received within 10 business days or PEBB will close the appeal.

(C) The analyst will complete the review of the appeal within 30 days from the date PEBB receives all necessary appeal documentation. PEBB will notify the employee or individual of any delay.

(D) When the review is complete, the analyst will provide a written letter of explanation and determination to the employee or individual. If the appeal is denied, continued appeal steps will be included in the document.

(b) Level Two: An eligible employee or an individual who is dissatisfied with a Level One appeal determination may within 30 days of the level one determination letter request a Level Two review from the PEBB Plan Design Manager.

(A) The employee or individual must submit the request to the Plan Design Manager in writing and provide any new supporting documentation. The manager may request additional information from the employee, the employer, or plan. Information requested from the employee must be received within 10 business days or PEBB will close the appeal.

(B) The Plan Design Manager will review the request and determine whether to provide a determination to the employee or individual, or to move the request directly to the third level of appeals.

(C) If the Plan Design Manager completes a review, the employee or individual will receive a written letter of explanation and determination. If the appeal is denied, continued appeal steps will be included in the document.

(D) If the Plan Design Manager sends the appeal directly to Level Three without providing a determination, the employee will receive written notice.

(c) Level Three: An eligible employee or individual receiving both a first and second level appeal denial can request that the Board Appeals Subcommittee review the appeal. The Subcommittee can also review appeals submitted directly to them by the Plan Design Manager. The Board Appeals Subcommittee will provide a final decision to the employee or the individual.

(A) An employee or individual requesting a Level Three review must submit the request in writing to the Plan Design Manager within 30 days of the Level Two determination letter date.

(B) The Subcommittee appeal determination requires a majority vote of the members. If an agreement cannot be reached, the appeal may be referred to the full Board. Decisions by the full Board require a majority vote. The Appeals Subcommittee may render a decision to the employee or individual and also refer the issue to the full Board for a benefit policy review.

(C) When the Subcommittee completes a review, or in the case of a full Board review, the employee or individual will receive a written explanation and determination within 30 days after the meeting.

(5) An individual may appeal the Subcommittee or Board’s decision as provided under the Oregon Administrative Procedures Act, ORS Chapter 183

Stat. Auth.: ORS 243.061 - 302

Stats. Implemented: ORS 243.061 - 302

Hist.: PEBB 3-2010, f. 9-23-10, cert. ef. 10-1-10; PEBB 1-2013, f. & cert. ef. 9-24-13

101-030-0005

Continuation of Group Medical and Dental Insurance Coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA)

COBRA allows an eligible individual who is losing an employer’s group health plan coverage due to a qualifying event to continue coverage for a limited time. PEBB COBRA is a self-pay premium by the eligible individual.

(1) PEBB participating organizations will issue an initial COBRA notice to all newly eligible employees and individuals that explains the right to continue employer medical and dental insurance plans if lost.

(a) The notice must be mailed to the eligible employee’s address of record immediately following enrollment in PEBB medical or dental insurance plans or personally delivered to the employee. The notice must include all PEBB covered individuals residing at the address, including family members, a domestic partner, and a domestic partner’s dependent children. Agencies must send a separate notice to the address of record for eligible individuals residing separately from the eligible employee.

(b) An initial COBRA notice must be mailed to individuals who become newly eligible for PEBB coverage due to marriage or the formation of a domestic partnership.

(2) To initiate COBRA eligibility a COBRA triggering event must occur causing the loss of benefit coverage. COBRA triggering events include:

(a) An involuntary reduction in hours or layoff.

(b) A strike or lockout.

(c) The beginning of an unpaid leave of absence.

(d) The termination of employment.

(e) Retirement.

(f) A dependent child no longer satisfying eligibility requirements.

(g) The loss of employer-sponsored group coverage for dependents due to Medicare eligibility.

(h) A divorce or termination of a domestic partnership.

(i) The death of the employee.

(3) All individuals losing eligibility due to a triggering event must receive a COBRA continuation notice. PEBB participating organizations must notify PEBB’s Third Party Administrator (TPA) within 30 days of the date of benefit eligibility. The date eligibility is lost is the COBRA triggering event date.

(a) The PEBB TPA mails a COBRA notice of continuation, which includes a Certificate of Group Health Plan Coverage, to each eligible individual at their last address of record when eligibility for PEBB-sponsored insurance coverage is lost. The TPA must mail the notice to each eligible individual within 14 days of receiving the notification.

(b) An eligible employee has 60 days from the receipt of the COBRA notice to activate their COBRA rights of continuation. PEBB-sponsored insurance coverage must be continuous through COBRA implementation.

(4) Generally, health plans may be continued under COBRA provisions for the following basic maximum coverage periods:

(a) For termination or reduction in hours, section (2)(a)–(e) of this rule, 18 months after the date of the triggering event; or

(b) For Section (2)(f)–(i) of this rule, 36 months after the date of the triggering event.

(5) An eligible employee’s spouse or domestic partner who is 55 years of age or older and who loses benefit coverage due to divorce, termination of a domestic partnership, or death of the employee, section (2)(h) and (i) of this rule, may continue PEBB health insurance coverage for themselves and their dependent children beyond the general 36 month COBRA continuation period. An eligible spouse or domestic partner may continue their PEBB health insurance coverage until they are entitled to Medicare, are covered under another group medical insurance plan, or otherwise lose eligibility.

(6) An eligible individual continuing PEBB medical or dental insurance coverage or both under COBRA provisions has the same rights as active eligible employees for making changes during the open enrollment period and is eligible for qualified midyear changes.

(7) An eligible employee ending employment may continue to participate in the Healthcare Flexible Spending Account through COBRA up to the end of the current plan year if when the triggering event occurs:

(a) They have a positive balance in their account; and

(b) They self-pay contributions to the account. Contributions after employment ends are paid on an after-tax basis.

Stat. Auth.: ORS 243.061 - 302

Stats. Implemented: ORS 243.061-302, 659A.060-069 & 743.600-602

Hist.: PEBB 1-1999, f. 12-8-99, cert. ef. 1-1-00; PEBB 1-2002, f. 7-30-02, cert. ef. 8-1-02; PEBB 1-2003, f. & cert. ef 12-4-03; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 3-2004, f. & cert. ef. 10-7-04; PEBB 2-2007, f. 9-28-07, cert. ef. 10-1-07; PEBB 1-2013, f. & cert. ef. 9-24-13

101-030-0070

Life, Disability, and Accidental Death and Dismemberment Insurance — Continuation of Coverage

(1) When an eligible employee separates from state service optional life insurance coverage may continue through the plan, not PEBB, as follows:

(a) Portability. An eligible employee terminating employment, other than for disability or retirement, may continue the employee’s optional employee, spouse, and domestic partner life insurance coverage at the group rate, plus billing fees. The policy remains a term life insurance policy. The employee must apply directly to the plan within 30 days of the date coverage ends. Portability is not available for employee basic life or dependent life coverage. A survivor of a covered eligible employee may continue optional life insurance through the plan upon the death of the employee.

(b) Conversion Rights. An eligible employee terminating employment for any reason, including disability or retirement, or experiencing a reduction in hours to less than 80 paid regular hours in the month, may be eligible to convert the employee’s term life insurance coverage. Not all policy types are available for conversion. The employee must apply directly to the plan within 30 days of the date insurance coverage ends. A survivor of a covered eligible employee may convert life insurance coverage through the plan upon the death of the employee.

(c) Retiree Life Insurance Option. An eligible employee who retires may purchase the Retiree Life Insurance Option without submitting evidence of insurability. The employee must apply directly to the insurance plan within 30 days of the date insurance coverage ends.

(d) Transfer of Premium Payment for Optional Employee Life Insurance. When two active eligible employees are married or in a domestic partnership and both are state employees, one employee can transfer their optional life insurance coverage to the other employee’s life insurance coverage or to themselves upon:

(A) Terminating employment for any reason;

(B) Beginning an active military leave;

(C) Divorce;

(D) Termination of their domestic partnership, or;

(E) Retirement. The remaining employed eligible employee must submit the completed and signed transfer form to their agency within 30 days of the date of the events listed in (1)(d) of this rule.

(2) There are no portability, conversion, or rollover continuation options for short term or long term disability or accidental death and dismemberment insurance coverage.

Stat. Auth.: ORS 243.061 – 302

Stats. Implemented: ORS 243.061 – 302

Hist.: PEBB 2-2007, f. 9-28-07, cert. ef. 10-1-07; Renumbered from 101-020-0070, PEBB 7-2010, f. 12-10-10, cert. ef. 1-1-11; PEBB 1-2013, f. & cert. ef. 9-24-13


Rule Caption: Division 5 rules are being amended to support the Board’s procurement and renewal processes.

Adm. Order No.: PEBB 2-2013(Temp)

Filed with Sec. of State: 10-2-2013

Certified to be Effective: 10-2-13 thru 3-28-14

Notice Publication Date:

Rules Amended: 101-005-0040, 101-005-0105, 101-005-0110

Subject: Division 5 rules are being amended to support the Board’s procurement and renewal processes.

Rules Coordinator: Cherie Taylor—(503) 378-6296

101-005-0040

Procurement and Renewal Processes

(1) Formal Selection Procedure: This procedure will be used for the procurement of Benefits. Exceptions to this procedure are specified in sections (2), (3), (4) and (5).

(a) Announcement: The Board will give notice of intent to contract for Benefits via the Oregon Procurement Information Network (ORPIN). The notice shall include a description of the Benefits or services sought, the scope of the services required, and a description of special requirements, if any. The notice will invite qualified prospective contractors to apply. The notice will specify when and where the application may be obtained, to whom it must be returned, and the closing date.

(b) Proposal: The Proposal from the prospective contractors will consist of a statement that describes the prospective contractor’s credentials, performance data and other information sufficient to establish contractor’s qualifications for providing the Benefits or services sought, as well as any other information requested in the announcement.

(c) Evaluation: The Board or its designees will evaluate the qualifications of all applicants and select prospective contractors as set forth in OAR 101-005-0110.

(d) Award of Contracts: The Board will make final selections based on the criteria included in OAR 101-002-005(3) in addition to criteria included in the Request for Proposals.

(2)(a) Informal Selection Procedure: This procedure may be used at the Board’s discretion, when the informal selection procedure will not interfere with competition among prospective contractors, reduce the quality of services, is an amount less than $150,000 in contract costs, or will not increase costs. The Board will contact a minimum of three prospective contractors known to the Board to be qualified to propose the sought-after services. The selection will be made by the Board based upon the factors described in paragraph (1)(d) of this rule. If three quotes are not received, the Board will make a written record of its efforts to obtain quotes.

(b) When informal selection procedure has been used, the cumulative amendment(s) to the contract shall not increase the total contract cost to sum that is greater than twenty-five percent (25%) of the original contract cost.

(3)(a) Sole Source Procedure: PEBB may award a contract for Benefits without competition when the Administrator of PEBB determines in writing that the services are available from only one source, or the contractor is defined as a Qualified Rehabilitation Facility as defined in Oregon’s public contracting code.

(b) The determination of a sole source must be based on written findings that may include:

(A) That the efficient utilization of existing services requires the acquisition of compatible services;

(B) That the services required for the exchange of software or data with other public or private agencies are available from only one source;

(C) That the services are for use in a pilot or an experimental project, or;

(D) Other findings that support the conclusion that the goods or services are available from only one source.

(c) To the extent reasonably practical, PEBB shall negotiate with the sole source to obtain contract terms advantageous to PEBB.

(4) Renewal Procedure: If the Board does not issue an RFP or Single Source procurements to solicit formal proposals from qualified potential Contractors or Vendors, the Board may directly negotiate and enter into renewal contracts each plan year with Renewal Contractors to provide Benefits and other services without following the procedures set forth in sections (1) and (2) above. The Board may renew contracts with Renewal Contractors for as many years as the Board determines is in the best interest of the state and employees. The Board may invite renewal Proposals from those Contractors or Vendors who provided the same or similar employee Benefit Plan or other services in the year immediately prior. An employee Benefit Plan or other services contract is similar if it is reasonable related to the scope of work described in the procurement under which such a contract was awarded. The Board will negotiate with Renewal Contractors and enter into contracts with them after giving full consideration to the factors listed in paragraph (1)(d) or to such of those factors as the Board determines shall be evaluated for the renewal.

(5) Emergency Appointment Procedure: The Board may select a Benefit Plan or other service Contractor without following any of the above procedures when Emergency conditions require. In such instance, the recommended appointment and a written description of the conditions requiring the use of this appointment procedure shall be submitted to the Board. The Board will determine if an Emergency exists, declare the Emergency and negotiate a contract with the Contractor after giving full consideration to the factors listed in paragraph (1)(d).

Stat. Auth.: ORS 243.061 - 243.302

Stats. Implemented: ORS 243.135

Hist.: PEBB 1-2003, f. & cert. ef. 12-4-03; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 2-2005, f. 7-26-05, cert. ef. 7-29-05; PEBB 1-2009(Temp), f. & cert. ef. 2-24-09 thru 8-22-09; PEBB 2-2009, f. 7-29-09, cert. ef. 8-1-09; PEBB 3-2010, f. 9-23-10, cert. ef. 10-1-10, PEBB 2-2013(Temp), f. & cert. ef. 10-2-13 thru 3-28-14

101-005-0105

Submission of Proposals; Format; Timing

(1) All Proposals submitted as a result of a Formal Solicitation, Informal Solicitation, or Single Source Solicitation shall comply with the procurement’s specifications. If portions of the Proposal to any solicitation are deemed unacceptable or non-responsive to the specifications of the solicitation, the Proposal will be deemed non-responsive and will not be given further evaluation or consideration. If a Proposal to any solicitation is delivered late, it will be deemed non-responsive to the specification of the solicitation and will be returned to the Proposer unopened.

(2) Unless otherwise specified in the procurement, submission of Proposals shall be in writing and shall be delivered in the written format, as required by the specifications of the solicitation. Proposals may be submitted entirely electronically in a reasonable format if required by the solicitation documents.

Stat. Auth.: ORS 243.061 - 243.302

Stats. Implemented: ORS.243.125(1)

Hist.: PEBB 2-2005, f. 7-26-05, cert. ef. 7-29-05; PEBB 3-2010, f. 9-23-10, cert. ef. 10-1-10, PEBB 2-2013(Temp), f. & cert. ef. 10-2-13 thru 3-28-14

101-005-0110

Evaluation of Proposals

(1) Evaluation. The evaluation process described in this rule applies to the Formal Selection Procedure set forth in OAR 101-005-0040(1). The Board and any assigned representatives, including but not limited to, PEBB stakeholders staff, or Consultants, hereinafter identified as the Selection Committee, shall evaluate Proposals only in accordance with criteria set forth in the RFP and applicable law. The Board shall evaluate Proposals to determine the Responsible Proposer or Proposers submitting the best responsive Proposal or Proposals.

(2) Competitive Range; Protest; Award.

(a) Determining Competitive Range. If the Board does not cancel the solicitation, the Board will evaluate all Proposals in accordance with the evaluation criteria set forth in the RFP. After evaluation of all Proposals in accordance with the criteria set forth in the RFP, the Board will determine the Proposers in the competitive range.

(b) Protesting Competitive Range. The Board shall provide written notice to all Proposers identifying Proposers in the competitive range. A Proposer that is not within the competitive range may protest the Board’s evaluation and determination of the competitive range in not more than two (2) business days after the Board has sent written e-mail notice of the competitive range to all Proposers.

(c) Intent to Award; Discuss or Negotiate. After the protest period provided in accordance with paragraph (2) (b) expires, or after the Board has provided a final response to any protest, whichever date is later, the Board may engage in discussions and negotiations with Proposers in the competitive range.

(3) Discussions and Negotiations. If the Board chooses to enter into discussions and negotiations with the Proposers in the competitive range, the Board shall proceed as follows:

(a) Initiating Discussions. The Board shall initiate oral or written discussions and negotiations with all of the Proposers in the competitive range regarding their Proposals.

(b) Conducting Discussions. The Board may conduct discussions and negotiations with each Proposer in the competitive range necessary to fulfill the purposes of this section, but need not conduct the same amount of discussions or negotiations with each Proposer. The Board may terminate discussions and negotiations with any Proposer in the competitive range at any time. However, the Board shall offer all Proposers in the competitive range the opportunity to discuss their Proposals with the Board before the Board notifies Proposers of the award decisions. The Proposers’ opportunity to discuss their Proposals with the Board before Proposers are notified of the award decisions may be satisfied by interviewing Proposers in the competitive range, as specified in the RFP.

(A) In conducting discussions, the Board and any designated representatives:

(i) Shall treat all Proposers fairly and shall not favor any Proposer over another;

(ii) Shall determine whether other factors, including but not limited to, Oregon residency of the primary business office and Proposer demonstration of services and products, will be used to determine the apparent successful Proposer, should a tie between Proposers occur.

(B) At any time during the time allowed for discussions and negotiations, the Board may:

(i) Continue discussions and negotiations with a particular Proposer or Proposers, or;

(ii) Terminate discussions with a particular Proposer and continue discussions with other Proposers in the competitive range;

(C) The Board may continue discussions and negotiations with Proposers until the Board has determined which Proposer or Proposers shall be awarded contracts.

(c) Intent to Award; Protest. The Board shall provide written notice to all Proposers in the competitive range of the Board’s intent to award the contracts. An unsuccessful Proposer may protest the Board’s intent to award in accordance with OAR 101-005-0140. After the protest period provided in accordance with OAR 101-005-0140 expires, or after the Board has provided a final response to any protest, whichever date is later, the Board may commence final Contract execution with the successful Proposer or Proposers.

Stat. Auth.: ORS 243.061 - 243.302

Stats. Implemented: ORS 243.135 & 243.125

Hist.: PEBB 1-2003, f. & cert. ef. 12-4-03; PEBB 1-2004, f. & cert. ef. 7-2-04; PEBB 2-2005, f. 7-26-05, cert. ef. 7-29-05; PEBB 3-2010, f. 9-23-10, cert. ef. 10-1-10, PEBB 2-2013(Temp), f. & cert. ef. 10-2-13 thru 3-28-14

Notes
1.) This online version of the OREGON BULLETIN is provided for convenience of reference and enhanced access. The official, record copy of this publication is contained in the original Administrative Orders and Rulemaking Notices filed with the Secretary of State, Archives Division. Discrepancies, if any, are satisfied in favor of the original versions. Use the OAR Revision Cumulative Index found in the Oregon Bulletin to access a numerical list of rulemaking actions after November 15, 2012.

2.) Copyright 2013 Oregon Secretary of State: Terms and Conditions of Use

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