US Code

Public Law 119-73 (01/23/2026)

5 U.S.C. § 8902

Contracting authority

(a)
The Office of Personnel Management may contract with qualified carriers offering plans described by section 8903 or 8903a of this title, without regard to section 6101(b) to (d) of title 41 or other statute requiring competitive bidding. Each contract shall be for a uniform term of at least 1 year, but may be made automatically renewable from term to term in the absence of notice of termination by either party.
(b)
section 8903(2) of this title To be eligible as a carrier for the plan described by , a company must be licensed to issue group health insurance in all the States and the District of Columbia.
(c)
A contract for a plan described by section 8903(1) or (2) of this title shall require the carrier—
(1)
to reinsure with other companies which elect to participate, under an equitable formula based on the total amount of their group health insurance benefit payments in the United States during the latest year for which the information is available, to be determined by the carrier and approved by the Office; or
(2)
to allocate its rights and obligations under the contract among its affiliates which elect to participate, under an equitable formula to be determined by the carrier and the affiliates and approved by the Office.
(d)
Each contract under this chapter shall contain a detailed statement of benefits offered and shall include such maximums, limitations, exclusions, and other definitions of benefits as the Office considers necessary or desirable.
(e)
The Office may prescribe reasonable minimum standards for health benefits plans described by section 8903 or 8903a of this title and for carriers offering the plans. Approval of a plan may be withdrawn only after notice and opportunity for hearing to the carrier concerned without regard to subchapter II of chapter 5 and chapter 7 of this title. The Office may terminate the contract of a carrier effective at the end of the contract term, if the Office finds that at no time during the preceding two contract terms did the carrier have 300 or more employees and annuitants, exclusive of family members, enrolled in the plan.
(f)
A contract may not be made or a plan approved which excludes an individual because of race, sex, health status, or, at the time of the first opportunity to enroll, because of age.
(g)
section 8905a of this titlesection 8905a of this title A contract may not be made or a plan approved which does not offer to each employee, annuitant, family member, former spouse, or person having continued coverage under whose enrollment in the plan is ended, except by a cancellation of enrollment, a temporary extension of coverage during which he may exercise the option to convert, without evidence of good health, to a nongroup contract providing health benefits. An employee, annuitant, family member, former spouse, or person having continued coverage under who exercises this option shall pay the full periodic charges of the nongroup contract.
(h)
The benefits and coverage made available under subsection (g) of this section are noncancelable by the carrier except for fraud, over-insurance, or nonpayment of periodic charges.
(i)
Rates charged under health benefits plans described by section 8903 or 8903a of this title shall reasonably and equitably reflect the cost of the benefits provided. Rates under health benefits plans described by section 8903(1) and (2) of this title shall be determined on a basis which, in the judgment of the Office, is consistent with the lowest schedule of basic rates generally charged for new group health benefit plans issued to large employers. The rates determined for the first contract term shall be continued for later contract terms, except that they may be readjusted for any later term, based on past experience and benefit adjustments under the later contract. Any readjustment in rates shall be made in advance of the contract term in which they will apply and on a basis which, in the judgment of the Office, is consistent with the general practice of carriers which issue group health benefit plans to large employers.
(j)
section 8905a of this title Each contract under this chapter shall require the carrier to agree to pay for or provide a health service or supply in an individual case if the Office finds that the employee, annuitant, family member, former spouse, or person having continued coverage under is entitled thereto under the terms of the contract.
(k)
(1)
section 8905a of this title When a contract under this chapter requires payment or reimbursement for services which may be performed by a clinical psychologist, optometrist, nurse midwife, nursing school administered clinic, or nurse practitioner/clinical specialist, licensed or certified as such under Federal or State law, as applicable, or by a qualified clinical social worker as defined in section 8901(11), an employee, annuitant, family member, former spouse, or person having continued coverage under covered by the contract shall be free to select, and shall have direct access to, such a clinical psychologist, qualified clinical social worker, optometrist, nurse midwife, nursing school administered clinic, or nurse practitioner/nurse clinical specialist without supervision or referral by another health practitioner and shall be entitled under the contract to have payment or reimbursement made to him or on his behalf for the services performed.
(2)
Nothing in this subsection shall be considered to preclude a health benefits plan from providing direct access or direct payment or reimbursement to a provider in a health care practice or profession other than a practice or profession listed in paragraph (1), if such provider is licensed or certified as such under Federal or State law.
(3)
section 8903(4) of this title The provisions of this subsection shall not apply to comprehensive medical plans as described in .
(l)
section 8903(4) of this title1
1 See References in Text note below.
42 U.S.C. 300c–9(d) The Office shall contract under this chapter for a plan described in with any qualified health maintenance carrier which offers such a plan. For the purpose of this subsection, “qualified health maintenance carrier” means any qualified car­rier which is a qualified health maintenance organization within the meaning of section 1310(d)(1)  of title XIII of the Public Health Service Act ().
(m)
(1)
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 thereunder, which relates to health insurance or plans.
(2)
(A)
42 U.S.C. 254e Notwithstanding the provisions of paragraph (1) of this subsection, if a contract under this chapter provides for the provision of, the payment for, or the reimbursement of the cost of health services for the care and treatment of any particular health condition, the carrier shall provide, pay, or reimburse up to the limits of its contract for any such health service properly provided by any person licensed under State law to provide such service if such service is provided to an individual covered by such contract in a State where 25 percent or more of the population is located in primary medical care manpower shortage areas designated pursuant to section 332 of the Public Health Service Act ().
(B)
section 8903(4) of this title The provisions of subparagraph (A) shall not apply to contracts entered into providing prepayment plans described in .
(n)
A contract for a plan described by section 8903(1), (2), or (3), or section 8903a, shall require the carrier—
(1)
to implement hospitalization-cost-containment measures, such as measures—
(A)
for verifying the medical necessity of any proposed treatment or surgery;
(B)
for determining the feasibility or appropriateness of providing services on an outpatient rather than on an inpatient basis;
(C)
for determining the appropriate length of stay (through concurrent review or otherwise) in cases involving inpatient care; and
(D)
involving case management, if the circumstances so warrant; and
(2)
to establish incentives to encourage compliance with measures under paragraph (1).
(o)
A contract may not be made or a plan approved which includes coverage for any benefit, item, or service for which funds may not be used under the Assisted Suicide Funding Restriction Act of 1997.
(p)
Each contract under this chapter shall require the carrier to comply with requirements described in the provisions of sections 2799A–1, 2799A–2, and 2799A–7 of the Public Health Service Act, sections 716, 717, and 722 of the Employee Retirement Income Security Act of 1974, and sections 9816, 9817, and 9822 of the Internal Revenue Code of 1986 (as applicable) in the same manner as such provisions apply to a group health plan or health insurance issuer offering group or individual health insurance coverage, as described in such sections. The provisions of sections 2799B–1, 2799B–2, 2799B–3, and 2799B–5 of the Public Health Service Act shall apply to a health care provider and facility and an air ambulance provider described in such respective sections with respect to an enrollee in a health benefits plan under this chapter in the same manner as such provisions apply to such a provider and facility with respect to an enrollee in a group health plan or group or individual health insurance coverage offered by a health insurance issuer, as described in such sections.

Pub. L. 89–55480 Stat. 601Pub. L. 93–246, § 388 Stat. 4Pub. L. 93–363, § 188 Stat. 398Pub. L. 94–183, § 2(43)89 Stat. 1059Pub. L. 94–460, title I, § 110(b)90 Stat. 1952Pub. L. 95–368, § 192 Stat. 606Pub. L. 95–454, title IX, § 906(a)(2)92 Stat. 1224Pub. L. 96–179, § 393 Stat. 1299Pub. L. 98–615, § 3(2)98 Stat. 3203Pub. L. 99–53, § 2(a)99 Stat. 94Pub. L. 99–251, title I100 Stat. 15Pub. L. 100–202, § 101(m) [title VI, § 626]101 Stat. 1329–390Pub. L. 100–654, title II102 Stat. 3845Pub. L. 101–508, title VII, § 7002(a)104 Stat. 1388–329Pub. L. 101–509, title IV, § 1104 Stat. 1421Pub. L. 102–393, title V, § 537(a)106 Stat. 1765Pub. L. 105–12, § 9(g)111 Stat. 27Pub. L. 105–266112 Stat. 2366Pub. L. 111–350, § 5(a)(15)124 Stat. 3842Pub. L. 116–260, div. BB, title I, § 102(d)(1)134 Stat. 2797(, , ; , , ; , , ; , , ; , , ; , , ; , (3), , ; , , ; , , ; , , ; , §§ 105(b), 106(a)(3), , , 16; , , , 1329–430; , §§ 201(b), 202(a), , ; , , ; , , ; , (b), , ; , , ; , §§ 3(c), 8, , , 2370; , , ; , , .)

Historical and Revision Notes

Derivation

U.S. Code

Revised Statutes and

Statutes at Large

 

5 U.S.C. 3005.

Sept. 28, 1959, Pub. L. 86–382, § 6, 73 Stat. 712.

 

 

Mar. 17, 1964, Pub. L. 88–284, § 1(7)–(9), 78 Stat. 165.

Standard changes are made to conform with the definitions applicable and the style of this title as outlined in the preface to the report.

Editorial Notes

References in Text

42 U.S.C. 300c–9(d)lsection 300e–9(d) of Title 42Section 300e–9(d) of Title 42section 300e–9(c) of Title 42Pub. L. 100–517, § 7(b)102 Stat. 2580Section 1310(d)(1) of title XIII of the Public Health Service Act (), referred to in subsec. (), probably is intended as a reference to , The Public Health and Welfare. was redesignated by , , .

oPub. L. 105–12111 Stat. 23section 14401 of Title 42The Assisted Suicide Funding Restriction Act of 1997, referred to in subsec. (), is , , , which is classified principally to chapter 138 (§ 14401 et seq.) of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under and Tables.

Sections 2799A–1, 2799A–2, 2799A–7, 2799B–1, 2799B–2, 2799B–3, and 2799B–5 of the Public Health Service Act, referred to in subsec. (p), are classified to sections 300gg–111, 300gg–112, 300gg–117, 300gg–131, 300gg–132, 300gg–133, and 300gg–135, respectively, of Title 42, The Public Health and Welfare.

Sections 716, 717, and 722 of the Employee Retirement Income Security Act of 1974, referred to in subsec. (p), are classified to sections 1185e, 1185f, and 1185k, respectively, of Title 29, Labor.

Sections 9816, 9817, and 9822 of the Internal Revenue Code of 1986, referred to in subsec. (p), are classified to sections 9816, 9817, and 9822, respectively, of Title 26, Internal Revenue Code.

Codification

section 1 of title IV of Pub. L. 101–509104 Stat. 1416section 2102 of Title 44Another , , enacted sections 2701 to 2706 of Title 44, Public Printing and Documents, and provisions set out as a note under .

Amendments

Pub. L. 116–2602020—Subsec. (p). added subsec. (p).

Pub. L. 111–350section 5 of title 412011—Subsec. (a). substituted “section 6101(b) to (d) of title 41” for “”.

Pub. L. 105–266, § 81998—Subsec. (k)(2), (3). , added par. (2) and redesignated former par. (2) as (3).

Pub. L. 105–266, § 3(c)Subsec. (m)(1). , added par. (1) and struck out former par. (1) which read as follows: “The provisions of any contract under this chapter which relate to the nature 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 thereunder, which relates to health insurance or plans to the extent that such law or regulation is inconsistent with such contractual provisions.”

oPub. L. 105–12o1997—Subsec. (). added subsec. ().

Pub. L. 102–3931992— amended subsec. (k) generally. Prior to amendment, subsec. (k) read as follows:

section 8905a of this title“(1) When a contract under this chapter requires payment or reimbursement for services which may be performed by a clinical psychologist, optometrist, nurse midwife, or nurse practitioner/clinical specialist, licensed or certified as such under Federal or State law, as applicable, or by a qualified clinical social worker as defined in section 8901(11), an employee, annuitant, family member, former spouse, or person having continued coverage under covered by the contract shall be free to select, and shall have direct access to, such a clinical psychologist, qualified clinical social worker, optometrist, nurse midwife, or nurse practitioner/nurse clinical specialist without supervision or referral by another health practitioner and shall be entitled under the contract to have payment or reimbursement made to him or on his behalf for the services performed.

“(2) The provisions of this subsection shall not apply to group practice prepayment plans.”

Pub. L. 101–5091990—Subsec. (k)(1). substituted “performed by a clinical psychologist, optometrist, nurse midwife, or nurse practitioner/clinical specialist” for “performed by a clinical psychologist or optometrist” and “qualified clinical social worker, optometrist, nurse midwife, or nurse practitioner/nurse clinical specialist” for “qualified clinical social worker or optometrist”.

Pub. L. 101–508Subsec. (n). added subsec. (n).

Pub. L. 100–654section 8905a of this title1988—Subsecs. (g), (j), (k)(1). substituted “former spouse, or person having continued coverage under ” for “or former spouse” wherever appearing.

Pub. L. 100–202, § 101(m) [title VI, § 626(1), (2)]1987—Subsec. (k)(1). , inserted “or by a qualified clinical social worker as defined in section 8901(11),” after “as applicable,”, and “, qualified clinical social worker” after “such a clinical psychologist”.

Pub. L. 100–202, § 101(m) [title VI, § 626(3)]Subsec. (k)(2), (3). , redesignated par. (3) as (2) and struck out former par. (2) which read as follows: “When a contract under this chapter requires payment or reimbursement for services which may be performed by a qualified clinical social worker, an employee, annuitant, family member, or former spouse covered by the contract shall be entitled under the contract to have payment or reimbursement made to him or on his behalf for the services performed. As a condition for the payment or reimbursement, the contract—

“(A) may require that the services be performed pursuant to a referral by a psychiatrist; but

“(B) may not require that the services be performed under the supervision of a psychiatrist or other health practitioner.”

Pub. L. 100–202, § 101(m) [title VI, § 626(4)]Subsec. (m)(2)(A). , struck out “This paragraph shall apply with respect to a qualified clinical social worker covered by subsection (k)(2) of this section without regard to whether such contract contains the requirement authorized by clause (i) of the second sentence of subparagraph (A) of such subsection (k)(2).”

Pub. L. 99–251, § 105(b)1986—Subsec. (k). , designated existing provisions as par. (1), struck out last sentence providing that the provisions of this subsection shall not apply to group practice prepayment plans, and added pars. (2) and (3).

Pub. L. 99–251, § 106(a)(3)Subsec. (m)(2)(A). , inserted last sentence relating to applicability of this paragraph with respect to a qualified clinical social worker covered by subsection (k)(2) of this section.

Pub. L. 99–53section 8903a of this title1985—Subsecs. (a), (e), (i). inserted reference to .

Pub. L. 98–615, § 3(2)(A)1984—Subsec. (g). , substituted “employee, annuitant, family member, or former spouse” for “employee or annuitant” in two places.

Pub. L. 98–615, § 3(2)(B)Subsecs. (j), (k). , substituted “family member, or former spouse” for “or family member”.

Pub. L. 96–17942 U.S.C. 254e42 U.S.C. 300e–171980—Subsec. (m)(2)(A). substituted “in a State where 25 percent or more of the population is located in primary medical care manpower shortage areas designated pursuant to section 332 of the Public Health Service Act ()” for “who is a member of a medically underserved population (within the meaning of section 1302(7) of the Public Health Service Act ())”.

lPub. L. 95–4541978—Subsecs. (a), (c) to (e), (i), (j), (). substituted “Office of Personnel Management” for “Civil Service Commission” and “Office” for “Commission” wherever appearing.

Pub. L. 95–368Subsec. (m). added subsec. (m).

lPub. L. 94–460l1976—Subsec. (). added subsec. ().

Pub. L. 94–183Pub. L. 93–3631975—Subsecs. (j), (k). redesignated subsec. (j), added by and relating to services performed by a clinical psychologist or optometrist, as (k).

Pub. L. 93–3631974—Subsec. (j). added subsec. (j) covering services performed by a clinical psychologist or optometrist.

Pub. L. 93–246 added subsec. (j) requiring the carrier to pay for or provide a health service or supply in specified cases.

Statutory Notes and Related Subsidiaries

Effective Date of 2020 Amendment

Pub. L. 116–260, div. BB, title I, § 102(e)134 Stat. 2797

section 223 of Title 26“The amendments made by this section [enacting sections 9816 and 9822 of Title 26, Internal Revenue Code, sections 1185e and 1185k of Title 29, Labor, and sections 300gg–111 and 300gg–117 of Title 42, The Public Health and Welfare, and amending this section, , and sections 300gg–19a, 300gg–21, 300gg–22, 300gg–23, and 18011 of Title 42] shall apply with respect to plan years (or, in the case of the amendment made by subsection (d)(1) [amending this section], with respect to contracts entered into or renewed for contract years) beginning on or after .”
, , , provided that:

Effective Date of 1997 Amendment

Pub. L. 105–12section 11 of Pub. L. 105–12section 14401 of Title 42Amendment by effective , and applicable to Federal payments made pursuant to obligations incurred after , for items and services provided on or after such date, subject to also being applicable with respect to contracts entered into, renewed, or extended after , as well as contracts entered into before , to the extent permitted under such contracts, see , set out as an Effective Date note under , The Public Health and Welfare.

Effective Date of 1992 Amendment

Pub. L. 102–393, title V, § 537(c)106 Stat. 1765

“The amendments made by this section [amending this section] shall be effective with respect to contract years beginning after the date of enactment of this Act [].”
, , , provided that:

Effective Date of 1990 Amendment

Pub. L. 101–508, title VII, § 7002(g)104 Stat. 1388–331

section 8904 of this titlesection 8906 of this title“Except as provided in subsection (f) [set out as a note under ], the amendments made by this section [amending this section, sections 8904, 8909, and 8910 of this title, and provisions set out as a note under ] shall apply with respect to contract years beginning on or after .”
, , , provided that:

Effective Date of 1988 Amendment

Pub. L. 100–654, title II, § 203102 Stat. 3845

“(a)

In General .—

section 8905a of this titleThe amendments made by this title [enacting and amending this section and sections 8903, 8905, and 8909 of this title] shall apply with respect to—
“(1)
any calendar year beginning, and contracts entered into or renewed for any calendar year beginning, after the end of the 9-month period beginning on the date of the enactment of this Act []; and
“(2)
any qualifying event occurring on or after the first day of the first calendar year beginning after the end of the 9-month period referred to in paragraph (1).
“(b)

Definition .—

For the purpose of this section, the term ‘qualifying event’ means any of the following events:
“(1)
A separation from Government service.
“(2)
A divorce, annulment, or legal separation.
“(3)
Any change in circumstances which causes an individual to become ineligible to be considered an unmarried dependent child under chapter 89 of such title [section 8901 et seq. of this title].”
, , , provided that:

Effective Date of 1986 Amendment

section 105(b) of Pub. L. 99–251section 105(c) of Pub. L. 99–251section 8901 of this titleAmendment by effective with respect to contracts entered into or renewed for calendar years beginning after , see , set out as a note under .

Pub. L. 99–251, title I, § 106(b)100 Stat. 16

“The amendments made by subsection (a) [amending this section and provisions set out as notes under this section] shall take effect with respect to services provided after .”
, , , provided that:

Effective Date of 1984 Amendment

Pub. L. 98–615section 4(a)(2) of Pub. L. 98–615section 8341 of this titleAmendment by effective , with enumerated exceptions, and applicable to any individual who is married to an employee or annuitant on or after that date, see , as amended, set out as a note under .

Effective Date of 1980 Amendment

Pub. L. 96–179, § 5(b)93 Stat. 1300Pub. L. 99–251, title I, § 106(a)(2)100 Stat. 16

“The amendments made by section 3 [amending this section] shall apply to services provided after , under any contract entered into or renewed after .”
, , , as amended by , , , provided that:

Effective Date of 1978 Amendments

Pub. L. 95–454section 907 of Pub. L. 95–454section 1101 of this titleAmendment by effective 90 days after , see , set out as a note under .

Pub. L. 95–368, § 392 Stat. 606Pub. L. 99–251, title I, § 106(a)(1)100 Stat. 16

section 8902(m)(2) of title 5“The provisions of , United States Code, as added by the first section of this Act, shall apply to services provided under any contract entered into or renewed after .”
, , , as amended by , , , provided that:

Effective Date of 1976 Amendment

Pub. L. 94–460section 118 of Pub. L. 94–460section 300e of Title 42Amendment by effective , see , set out as a note under , The Public Health and Welfare.

Effective Date of 1974 Amendments

Pub. L. 93–363, § 288 Stat. 398

“The amendment made by this Act [amending this section] shall become effective with respect to any contract entered into or renewed on or after the date of enactment of this Act [].”
, , , provided that:

Pub. L. 93–246, § 4(c)88 Stat. 4

“Section 3 [amending this section] shall become effective with respect to any contract entered into or renewed on or after the date of enactment of this Act [].”
, , , provided that:

Full Disclosure in Health Plan Contracts

Pub. L. 105–266, § 5112 Stat. 2368

section 8903a of title 5“The Office of Personnel Management shall encourage carriers offering health benefits plans described by section 8903 or , United States Code, with respect to contractual arrangements made by such carriers with any person for purposes of obtaining discounts from providers for health care services or supplies furnished to individuals enrolled in such plan, to seek assurance that the conditions for such discounts are fully disclosed to the providers who grant them.”
, , , provided that:

Rate Reduction for Medicare Eligible Federal Annuitants

Pub. L. 100–360, title IV, § 422102 Stat. 810Pub. L. 101–234, title III, § 301(a)103 Stat. 1985, , , which directed the Office of Personnel Management to reduce the rates charged medicare eligible individuals participating in health benefit plans by a prorated amount, was repealed by , , .

Authority of Carrier To Contract for Comprehensive Medical Services From a Group Practice Unit or Organization

Pub. L. 91–515, title IV, § 40184 Stat. 1309, , , authorized Secretary of Health, Education, and Welfare to permit any carrier which is a party to a contract entered into under this chapter or under the Retired Federal Employees Health Benefits Act, or which participates in carrying out of any such contract, to issue in any State contracts entitling any person as a beneficiary to receive comprehensive medical services from a group practice unit or organization with which such carrier has contracted or otherwise arranged for the provision of such services.