B-243885, Aug 27, 1991

B-243885, Aug 27, 1991

DIGEST

This decision is in response to an appeal by Ms. Anna M. Leal-Guzman of our Claims Group denial of her request for waiver of an overpayment resulting from the failure to make the proper deductions from her salary for high-option health insurance coverage. For the following reasons we hold that Ms. Leal-Guzman is not entitled to waiver. The failure to deduct the proper premiums occurred when Ms. Leal-Guzman transferred from her position with the Department of the Air Force to a position with the United States Equal Employment Opportunity Commission (EEOC), effective April 19, 1987. For the 25 years that she was with the Air Force, Ms. Leal-Guzman was enrolled in the Blue Cross/Blue Shield High-Option Health Insurance Plan. When she transferred to EEOC the Air Force initiated an SF-2810 to "Transfer Out" her high-option enrollment to the EEOC, effective April 18, and EEOC initiated an SF 2810 to "Transfer In" her insurance enrollment effective April 20. However, the EEOC administrative officer erroneously indicated that Ms. Leal-Guzman was continuing the low- option coverage. The EEOC Payroll Office acted on the basis of this erroneous information. Therefore, only premiums for the low-option family coverage were deducted from Ms. Leal-Guzman's pay. As a result, Ms. Leal- Guzman was overpaid $2,352.33 from April 25, 1987, through August 27, 1988. The error was detected when Ms. Leal-Guzman received a statement dated July 29, 1988, from Blue Cross/Blue Shield denying a claim because her plan had been terminated. For reasons not clear from the record, the insurance company had not received the SF-2810 transferring in her insurance enrollment. After she informed the EEOC administrative officer of this event, he initiated another SF-2810, retroactively continuing her enrollment in the high-option plan.

Ms. Leal-Guzman's request for waiver was forwarded to our Claims Group by EEOC. The EEOC concluded that Ms. Leal-Guzman was partially at fault only after Blue Cross/Blue Shield notified her in August 1987 that they had not received her "Transfer In" form. Thus, they recommended that the claim be partially waived in the amount of $410.77. Our Claims Group determined that she was partially at fault throughout the overpayment period and denied waiver of the overpayment in its entirety. This determination was based on the fact that she received leave and earnings statements throughout the overpayment period which specifically identified the amount deducted for health insurance, and she should have noticed that this amount was significantly lower than the amount she had been paying for high-option coverage in the Air Force.

On appeal Ms. Leal-Guzman argues that she contacted the EEOC administrative officer on several occasions to confirm that she was enrolled in the high-option plan. Furthermore, she contends that she was not covered by high-option insurance during the overpayment period.

The Comptroller General is authorized by 5 U.S.C. Sec. 5584 (1988) to waive claims of the United States against employees arising from erroneous overpayments of pay and allowances if collection would be against equity and good conscience only when there is no indication of fault or lack of good faith on the part of the employee or any other person having an interest in obtaining the waiver. We have held that the employee is not free from fault if it is determined that the employee reasonably could have been expected to know that an error had been made but failed to take corrective action. Sheldon H. Avenius, Jr., B-226465, Mar. 23, 1988; 4 C.F.R. Sec. 91.5(c) (1989).

Generally, if an employee has records which, if reviewed, would indicate an overpayment, and the employee fails to review such documents for accuracy or otherwise fails to take corrective action, then he is not without fault and waiver will be denied. George M. Dold, B-202795, Dec. 1, 1981,; Roosevelt W. Royals, B-188822, June 1, 1977; Arthur Weiner, B-184480, May 20, 1976. This rule is particularly relevant in the case of leave and earnings statements. As we stated in Frederick D. Crawford, 62 Comp.Gen. 608 (1982), we cannot stress too highly the importance of a careful review by each employee of the pay data provided by the employing agency. Such review, and reporting of discrepancies for remedial action, is an essential function in the government's attempt to reduce payroll errors.

In the present case Ms. Leal-Guzman was enrolled in the high-option plan in the Air Force and intended to continue such enrollment when she transferred to EEOC. This was reflected in the SF-2810 completed by the Air Force which states that transferred to the EEOC. The record further indicates that although Ms. Leal-Guzman did not receive the notice from Blue Cross/Blue Shield until August 1987, she received bi weekly leave and earnings statements both before and after her transfer to EEOC. believe that an examination of those statements would have revealed the under deduction, for the amount deducted was considerably less than the amount which should have been deducted for the high option plan. Although she frequently contacted the EEOC administrative officer to determine the status of her health insurance coverage and was assured that her enrollment would not change as a result of the transfer, she did not specifically question the fact that her health insurance premiums had been reduced by approximately $54.77 per pay period. Since Ms. Leal-Guzman was aware that she was to continue to be enrolled in the high-option health insurance plan, and since the agency's failure to deduct the proper premiums was apparent from an examination of her leave and earnings statements, we must conclude that she was on notice of the overpayment, and thereby deny waiver.

Ms. Leal-Guzman also asserts that because the wrong code was recorded on her SF-2810 she was not covered by the high-option plan during the overpayment period. In support of this conclusion she enclosed a notice from Blue Cross/Blue Shield stating that they had not received a "Transfer In" form and that they would be unable to process her claims until they had processed her form. She also included their subsequent denial of a claim on this same basis. Without the form, the insurance company considered her plan terminated.

However, Ms. Leal-Guzman was legally entitled to high-option coverage during the overpayment period. Indeed, in recognition of that fact her SF -2810 was retroactively corrected to indicate her enrollment in the high- option plan. According to the Federal Personnel Manual, an employee's enrollment and coverage continue without change when he transfers from one payroll office to another without a break in service of more than 3 days. The employee is not required to take any action to ensure continued coverage, but the employing office must complete certain procedures. Federal Personnel Manual (FPM) Supp. No. 890-1, S8 1a and S13-8 (Inst. 50, Mar. 10, 1989). As demonstrated in her case, errors in the enrollment code can be corrected and insurance coverage reinstated at the proper option level for the time period affected by the error. See FPM Supp. No. 890-1, S13-11. Moreover, although an employee may change from a self and family enrollment to a self-only enrollment at any time, an employee may make other changes in enrollment only in connection with certain specified events, none of which is applicable here. See FPM Supp. No. 890-1, S7-1 et seg. Thus, it is not against equity and good conscience to require

Ms. Leal-Guzman to pay for the high-option health insurance coverage.

Accordingly, we sustain the determination of our Claims Group denying Ms. Leal-Guzman's request for waiver.

/1/ Z-2901681-056, November 22, 1989.