Federal Employees Health Benefits Reform Act of 1991

Federal Employees Health Benefits Reform Act of 1991 - Revises the Federal Employees Health Benefits Program (the Program) to: (1) establish the Federal Employees Health Benefits Board (the Board); (2) replace current service and indemnity health benefit plans with a new Government-wide health insurance plan that offers both a standard and a high option for either self or family coverage; (3) require group- and individual-practice prepayment plans and mixed model prepayment plans to offer the same types of benefits offered under the standard option; (4) allow employee organization sponsored health plans to offer supplementary benefits; (5) establish flexible spending plans to allow employees to set aside a portion of their salary on a pretax basis to pay out-of-pocket health care expenses; and (6) allow annuitants whose annuities are insufficient to cover the full amount of required withholdings to elect to be covered under health benefits plans if they pay an amount equal to such withholdings to the Employees Health Benefits Fund (the Fund) through the retirement system that administers their health benefits enrollment.

Directs the Board to: (1) prescribe regulations governing the provision of health insurance benefits to Federal employees, their families, and retirees under the Government-wide plan in consultation with the Office of Personnel Management (OPM); and (2) establish procedures for reviewing the utilization of health care services under such plan and controlling service costs. Declares that the service providers shall not be eligible for payments under the plan unless they comply with such procedures. Specifies the benefits required to be provided under each option of the plan and the extent to which they are covered. Requires such individuals to meet specified annual deductions under each option of the plan before any benefits will be paid, except in the case of a family enrollment when the deduction will be waived once it is met by any two family members. Establishes maximum out-of-pocket expense limitations for self and family coverage under each option. Requires the plan to pay all covered expenses after out-of-pocket expenses have exceeded their appropriate maximum limitation.

Revises provisions for computing Government contributions. Establishes different requirements for each respective basic health benefits plan. Provides for the following with respect to the Government-wide plan: (1) establishment of specified biweekly employee contributions for the first administrative year to be increased for later years by the lesser of the increase in the medical care component of the consumer price index or the increase in the average enrollment charges; (2) procedures for determining average annual enrollment charges (the costs for providing benefits and administering the plan and any amounts necessary to maintain an adequate contingency reserve) in consultation with the Board for the first administrative year and for adjusting such charges for later years; (3) allocation of such costs to each option in a manner which is reasonable and equitable; (4) publication of new enrollment charges in the Federal Register and the Code of Federal Regulations; and (5) continued individual and family coverage for employees who are placed in a leave without pay status.

Revises provisions regarding contracting authority to establish separate authority for awarding competitive three-year contracts to nongovernmental organizations to administer the Government-wide plan on a regional basis in areas established by OPM. Requires plan administrators to review the utilization of health care services and implement the cost-control procedures established by the Board. Permits certain employee organizations which currently self-insure to serve as the plan administrators for employees within their bargaining unit. Repeals provisions regarding payment or reimbursement for services by: (1) psychologists or optometrists; and (2) any person licensed under State law in a State where a specified percentage of the population is located in primary medical care manpower shortage areas.

Revises provisions concerning election of coverage to: (1) provide automatic coverage under the Government-wide plan's standard option for self alone to an employee becoming eligible for Federal health insurance coverage unless the employee elects alternative coverage or to be excluded from coverage; (2) revise criteria for continuation of coverage for annuitants; and (3) extend coverage to unmarried dependent natural or adopted children of the former spouse and the employee who are students over age 22 but under age 23.

Allows temporary employees to enroll in the Government-wide plan provided they pay both employee and Government contributions.

Provides that if an individual eligible to enroll in a basic health benefits plan has a spouse who is also eligible, either may enroll for self and family or each may enroll as an individual, but no individual may be covered both as an enrollee and as a family member.

Sets forth rules to apply in administering provisions regarding: (1) election of coverage: (2) continued coverage; (3) coverage of restored employees and survivor or disability annuitants; (4) double coverage; and (5) changes in family status.

Requires any amounts forfeited under flexible spending plans to be transferred to a separate account which shall be within the Fund. Allows such amounts to be used for wellness programs for Federal employees.

Revises provisions regarding contribution set-asides in the Fund to establish new set-aside requirements for contributions to the basic health benefits plans.

Directs OPM to: (1) prescribe regulations to provide eligible individuals with an opportunity to elect coverage under the health benefits plans, to terminate their enrollment, to transfer to another such plan, or to make any other allowable changes in the terms or conditions of their enrollment; (2) on an annual basis compile statistics and submit to the Board a report on the use of the different benefits of the basic and supplemental plans and their costs to the Government as part of a continuing study of the operation and administration of the Program; (3) prescribe Program regulations providing for the establishment of wellness programs for Federal employees; and (4) prescribe regulations to ensure that, for any annuitant eligible to receive Medicare (title XVIII of the Social Security Act) and Federal health insurance benefits, deductibles and coinsurance or copayment amounts under the Program shall be waived to the same extent as before the enactment of this Act and that when an individual is eligible for Federal health insurance benefits which would be duplicative of Medicare benefits, the primary payer shall be the same as it would have been before the enactment of this Act.