B-188058, JAN 31, 1978

B-188058, JAN 31, 1978

1. EMPLOYEE OF DEPARTMENT OF COMMERCE, WHO TRANSFERRED TO A UNITED NATIONS AGENCY, DISCONTINUED HIS COVERAGE UNDER THE FEDERAL EMPLOYEES HEALTH BENEFITS PLAN (FEHBP). UPON REEMPLOYMENT WITH COMMERCE, HE REENROLLED IN FEHBP AND RETIRED APPROXIMATELY 5-1/2 MONTHS LATER WITH A REQUEST TO CONTINUE COVERAGE. EMPLOYEE WAS CREDITED FOR THE TIME OF DISCONTINUED ENROLLMENT TO ALLOW FEHBP COVERAGE IN HIS RETIREMENT. HOWEVER, THE PAYMENT OF PREMIUMS FOR THAT PERIOD CANNOT BE WAIVED UNDER 5 U.S.C. SEC. 5584 AS THE PREMIUMS SHOULD HAVE BEEN PAID BY HIM PERSONALLY AND NO APPROPRIATED FUNDS WERE INVOLVED. 2. FEDERAL EMPLOYEE TRANSFERRED TO INTERNATIONAL ORGANIZATION AND CANCELLED ENROLLMENT UNDER FEDERAL EMPLOYEES HEALTH BENEFITS PLAN (FEHBP) DURING PERIOD OF SUCH EMPLOYMENT. RECORDS SHOWS THAT IT WOULD BE INEQUITABLE TO REQUIRE HIM TO PAY BACK PREMIUMS TO CONTINUE ENROLLMENT UPON HIS RETIREMENT SINCE HE COULD NOT HAVE RECEIVED ANY BENEFITS DURING PERIOD COVERED BY BACK PREMIUMS AND NONPAYMENT RESULTED FROM IMPROPER AGENCY COUNSELLING. THUS, THERE EXISTS SUCH ELEMENTS OF LEGAL LIABILITY AND EQUITY AS TO DESERVE CONSIDERATION OF CONGRESS UNDER THE ACT OF APRIL 10, 1928, 45 STAT. 413, 31 U.S.C. SEC. 236, REGARDING MERITORIOUS CLAIMS AGAINST THE UNITED STATES.

JACK W. HERBSTREIT - WAIVER OF INDEBTEDNESS:

THIS ACTION CONCERNS MR. JACK W. HERBSTREIT'S REQUEST FOR WAIVER OF COLLECTION OF $2,630.85, WHICH CONSTITUTES THE FULL AMOUNT OF EMPLOYEE CONTRIBUTIONS HE OWES TO THE FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM (FEHBP), 5 U.S.C. SECS. 8901, ET SEQ. (1970), AS AMENDED, FOR THE PERIOD OF DISCONTINUED ENROLLMENT WHILE HE WAS EMPLOYED IN A SPECIALIZED AGENCY OF THE UNITED NATIONS (UN) BASED IN GENEVA.

THE RECORD SHOWS THAT MR. HERBSTREIT WAS AN EMPLOYEE OF THE INSTITUTE FOR TELECOMMUNICATION SCIENCE (ITS), DEPARTMENT OF COMMERCE, UNTIL AUGUST 27, 1966. AT THAT TIME HE TRANSFERRED TO A POSITION IN A SPECIALIZED AGENCY OF THE UN BASED IN GENEVA, THE INTERNATIONAL TELECOMMUNICATIONS UNION. EFFECTIVE THE PAY PERIOD BEGINNING NOVEMBER 5, 1966, MR. HERBSTREIT CANCELLED HIS ENROLLMENT UNDER THE FEHBP, AFTER CARRYING THE HIGH OPTION OF THE SERVICE BENEFIT PLAN SINCE 1960. HE DID SO BECAUSE HE WAS COMPELLED TO ENROLL IN THE UNITED NATIONS EUROPEAN OFFICE ILO-ITU HEALTH INSURANCE FUND. MOREOVER, HE WAS NOT COUNSELLED ABOUT THE REQUIREMENT TO BE ENROLLED UNDER THE FEHBP DURING THE 5 YEARS OF SERVICE IMMEDIATELY PRECEDING RETIREMENT IN ORDER TO BE ELIGIBLE TO CONTINUE ENROLLMENT AFTER RETIREMENT.

ON OCTOBER 7, 1974, MR. HERBSTREIT RESUMED EMPLOYMENT WITH THE DEPARTMENT OF COMMERCE AND REENROLLED IN THE SERVICE BENEFIT PLAN FROM OCTOBER 13, 1974, UNTIL HIS RETIREMENT ON MARCH 29, 1975. UPON HIS RETIREMENT MR. HERBSTREIT'S COVERAGE IN FEHBP WAS CANCELLED BY THE CIVIL SERVICE COMMISSION (CSC) BECAUSE THE LAW (5 U.S.C. SEC. 8905(B)(1)(A) (1970), AS AMENDED) REQUIRES THAT AN ANNUITANT BE ENROLLED IN FEHBP FOR 5 YEARS IMMEDIATELY PRIOR TO RETIREMENT.

SUBSEQUENTLY, THE CSC CHANGED ITS POSITION AND ALLOWED MR. HERBSTREIT TO CONTINUE COVERAGE AS AN ANNUITANT IN FEHBP FOR THE FOLLOWING REASONS. MR. HERBSTREIT HAD ORIGINALLY CANCELLED HIS FEHBP COVERAGE WHEN HE TRANSFERRED TO THE ITU BECAUSE IT WAS COMPULSORY THAT HE BE COVERED UNDER THE UNITED NATIONS EUROPEAN OFFICE ILO-ITO HEALTH INSURANCE FUND. MOREOVER, THE CSC FOUND THAT THE DEPARTMENT OF COMMERCE DID NOT PROPERLY ADVISE MR. HERBSTREIT AT THE TIME HE DROPPED THE FEHBP COVERAGE ON TRANSFER TO THE ITU THAT THERE WAS A REQUIREMENT THAT HE BE ENROLLED UNDER THE FEHBP DURING 5 YEARS OF SERVICE IMMEDIATELY PRECEDING RETIREMENT IN ORDER THAT HE BE ELIGIBLE TO CONTINUE HIS ENROLLMENT AFTER RETIREMENT.

THE COMMISSION, HOWEVER, CONCLUDED THAT THE LAW REQUIRED MR. HERBSTREIT TO PAY HIS SHARE OF THE COST OF FEHBP COVERAGE FOR THE PERIOD FROM NOVEMBER 11, 1966, THROUGH OCTOBER 12, 1974, AS IF HE HAD ACTUALLY HAD SUCH COVERAGE. MR. HERBSTREIT, THEREFORE, REQUESTS THAT THE REPAYMENT OF THESE PREMIUMS RETROSPECTIVELY FOUND DUE, BE WAIVED. THE DEPARTMENT OF COMMERCE HAS CONCURRED IN AND EXPRESSED FULL SUPPORT FOR MR. HERBSTREIT'S REQUEST.

THERE IS NO AUTHORITY UNDER THE LAW, 5 U.S.C. SEC. 5584, TO RELIEVE MR. HERBSTREIT OF HIS INDEBTEDNESS. SECTION 5584 OF TITLE 5, U.S.C. AUTHORIZES THE COMPTROLLER GENERAL TO WAIVE CLAIMS OF THE UNITED STATES AGAINST PERSONS ARISING OUT OF ERRONEOUS PAYMENTS OF PAY OR ALLOWANCES. THIS LAW, HOWEVER, BY ITS TERMS, DOES NOT EXTEND ITS BENEFITS TO MR. HERBSTREIT. DURING THE PERIOD INVOLVED MR. HERBSTREIT WAS AN EMPLOYEE OF A UN ORGANIZATION AND NOT OF THE FEDERAL GOVERNMENT. THEREFORE, EVEN IF HE HAD BEEN PROPERLY COUNSELED IN 1966 CONCERNING HIS HEALTH BENEFITS AND HE HAD ELECTED TO CONTINUE PAYING THE PREMIUMS FOR THE PERIOD OF NON- FEDERAL EMPLOYMENT IN ORDER TO QUALIFY HIM FOR CONTINUATION OF THE HEALTH BENEFITS INTO RETIREMENT AT SOME LATER DATE, SUCH PAYMENTS WOULD NOT HAVE COME FROM ANY FEDERAL SALARY EITHER BY DIRECT WITHHOLDING OR OTHERWISE. SINCE THERE WAS NO PAY DUE FROM THE FEDERAL GOVERNMENT, IF MR. HERBSTREIT HAD CONTINUED COVERAGE UNDER THE FEHBP, PAYMENT OF THE PREMIUM WOULD HAVE COME FROM HIS OWN PERSONAL FUNDS AND NOT FROM APPROPRIATED FUNDS. UNDER SUCH CIRCUMSTANCES IT CANNOT BE SAID THAT THE FAILURE TO COLLECT THE PREMIUMS RESULTED IN AN ERRONEOUS PAYMENT OF PAY. ACCORDINGLY, WE CANNOT WAIVE MR. HERBSTREIT'S INDEBTEDNESS.

WHILE WE CANNOT WAIVE THE INDEBTEDNESS UNDER 5 U.S.C. SEC. 5584, WE RECOGNIZE THAT THE COMMISSION'S REQUIREMENT THAT MR. HERBSTREIT PAY PREMIUMS FOR ALMOST 8 YEARS IN ORDER TO CONTINUE COVERAGE UNDER THE FEHBP, IMPOSES A SEVERE HARDSHIP UPON HIM. MOREOVER, DURING THE PERIOD IN QUESTION MR. HERBSTREIT WAS REQUIRED TO PAY PREMIUMS FOR THE UN HEALTH INSURANCE. ALSO, THE TIME DURING WHICH MR. HERBSTREIT COULD HAVE FILED CLAIMS FOR MEDICAL EXPENSES FOR THE PERIOD COVERED BY THE PAYMENT OF BACK PREMIUMS HAS EXPIRED. IN VIEW OF THE UNUSUAL CIRCUMSTANCES AND SINCE MR. HERBSTREIT DID NOT MAKE TIMELY PREMIUM PAYMENTS DUE TO THE FAILURE OF HIS AGENCY TO COUNSEL HIM PROPERLY, WE BELIEVE THAT HE IS ENTITLED TO EQUITABLE RELIEF. THEREFORE, WE ARE REFERRING MR. HERBSTREIT'S REQUEST FOR RELIEF OF LIABILITY TO CONGRESS UNDER THE ACT OF APRIL 10, 1928, 45 STAT. 413, 31 U.S.C. SEC. 236, REGARDING MERITORIOUS CLAIMS AGAINST THE UNITED STATES.