U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Washington, DC 20507 Willia M. and Alonzo N.,1 Complainants v. Margaret Weichert, Acting Director, Office of Personnel Management, Agency Appeal Nos. 0120132419, 0120132420 Hearing Nos. 100-A2-7218X, 100A27219X Agency No. EOP-99-03 DECISION The Commission's decision on these appeals concerns a challenged health insurance provision from 1998 to 2000 that excluded coverage of In vitro fertilization (IVF). The Commission takes no position on the question of whether a similar blanket exclusion of IVF, as that practice may exist currently, would violate the Rehabilitation Act. The Commission determines that the health insurance provision at issue in this case was a disability-based distinction and that the Agency failed to provide an adequate justification for this disability-based distinction. Therefore, the Commission REVERSES the Agency's final decision as it relates to Complainants' disability claims. SUMMARY Section 501 of the Rehabilitation Act ("Section 501") prohibits covered entities from discriminating on the basis of disability by entering into, or participating in, a contractual or other arrangement or relationship with an insurance company that has the effect of discriminating against qualified applicants or employees with disabilities. Section 501 has been amended to adopt the standards and defenses of the Americans with Disabilities Act in non-affirmative action discrimination claims. See 29 U.S.C. §791(g). The U.S. Office of Personnel Management ("OPM") contracts with Blue Cross and Blue Shield (BCBS) for a nationwide fee-for-service plan, known as the Service Benefit Plan ("Plan"). From 1998 to 2000, the Plan excluded from coverage various Assisted Reproductive Technology (ART) procedures, including in vitro fertilization ("IVF"). From 1998 to 2000, Complainant Willia M. ("the wife") underwent several cycles of IVF and the Plan denied Complainants' insurance claims for those procedures. Complainants (wife and husband) filed complaints alleging that OPM had discriminated against the wife on the basis of disability (infertility), and the husband on the basis of his relationship or association with an individual with a disability (infertility), when they were denied insurance coverage for their IVF treatments. In 2012, a U.S. Equal Employment Opportunity Commission (Commission) Administrative Judge (AJ) held a hearing in the matter and, on April 3, 2013, issued a decision in favor of the Agency. The AJ determined that the Agency's exclusion of coverage for IVF constituted a disability-based distinction because the procedure was used nearly exclusively by individuals with the disability of infertility. The AJ determined, however, that the Agency had met its burden of demonstrating that the exclusion of IVF procedures from the Plan was not a subterfuge to evade the purposes of Section 501 and, therefore, the Agency had met the requirements of Section 501(c) of the Americans with Disabilities Act (known as the insurance "safe harbor" provision). The AJ based her decision on the testimony of a BCBS official that the Plan excluded coverage for IVF (as well as for other ART procedures) because such procedures were not medically necessary in that they did not treat or cure the underlying cause of infertility. On June 4, 2013, Complainants appealed the AJ's decision to the Commission's Office of Federal Operations (OFO). The Commission affirms the AJ's decision that the Agency's contract with the Plan - that excluded coverage for IVF - was a disability-based distinction for purposes of Section 501. The Commission reverses the AJ's decision that the Agency met the requirements of the insurance "safe harbor" provision. The Commission determines that the Agency did not justify the Plan's exclusion of coverage for IVF based on actuarial data or actual or reasonably anticipated experience presented by the Agency and BCBS at the hearing. FACTUAL AND PROCEDURAL BACKGROUND In 1997, the wife was diagnosed as missing one ovary and two fallopian tubes and was told that the only medical treatment that would allow her to reproduce was IVF. Hearing Transcript at 59. In August 1998, the wife began undergoing IVF treatment and continued such treatments through August 2000. Id. at 102. While the wife was undergoing infertility treatment, Complainants were enrolled in BCBS's Plan. The Plan was offered through the Federal Employees Health Benefits (FEHB) Program which is offered as a fringe benefit of Federal employment. By statute, the U.S. Office of Personnel Management (OPM) approves benefit designs of health insurance plans, sets rules generally applicable to FEHB carriers, and adjusts policies as necessary to ensure compliance with nondiscrimination standards. See 5 U.S.C. § 8901 et seq. In April of each year, OPM issues a "call letter" to all approved and participating fee-for-service plans and HMOs to solicit proposed benefit and premium changes for the next year. See 5 CFR § 890.203(b). The call letter spells out OPM's negotiation objectives and benefit initiatives, gives guidance on the goals to be achieved, and advises on the types of cost containment efforts that plans may want to consider in order to contain premium increases. In 1993, OPM issued a call letter for fee-for-service plans that specified: All [fee-for-service] plans are to provide benefits for the diagnosis and treatment of infertility problems. This does not mandate coverage for ART procedures (artificial reproductive technology-such as artificial insemination, in vitro fertilization, and embryo transfer).2 After OPM's 1993 call letter, the BCBS Plan provided some coverage for the diagnosis and treatment of certain forms of infertility, including office visits, laboratory tests, X-rays, corrective surgical procedures, and fertility drug therapies that induce the production of multiple eggs. BCBS described the Plan's benefits as follows: The Service Benefit Plan considers infertility to be a bodily malfunction and treats the condition the same as any other illness. Therefore, benefits are available for all services medically necessary for the diagnosis and treatment of infertility. Covered services such as office visits, laboratory tests and X-ray studies to diagnose the cause of infertility are payable. FEP also provides benefits for necessary treatment of the condition. For example, corrective surgical procedures, therapeutic injections and drug therapy regimens are all covered services under FEP. The tests and procedures being used should be consistent with generally accepted medical practice and not consist of experimental or investigational services. Federal Employee Program (FEP) Administrative Manual (1998), Part IIA. However, BCBS made clear that the Plan would not cover a range of Assisted Reproductive Technology procedures, including IVF: Benefits are not provided for Assisted Reproductive Technology (ART) procedures that enable a woman with otherwise untreatable infertility to become pregnant through any artificial conception procedures such as artificial insemination, in vitro fertilization, embryo transfer and gamete intrafallopian transfer (GIFT). Services and supplies related to ART procedures are not covered. . . . ART, including artificial insemination, in vitro fertilization, embryonic transfer, including sperm banking is not treatment or care of an illness or injury. Therefore, these procedures are not covered services, and services related to these procedures are not covered. Id. at Part III. The wife underwent several IVF procedures from 1998 to 2000 and Complainants were denied reimbursement based on the Plan's exclusion of coverage for IVF. In October 1998, Complainants filed separate class complaints against OPM, alleging that the FEHP discriminated against people with the disability of infertility and those associated with such individuals by denying them insurance coverage for IVF. On May 5, 1999, an EEOC AJ remanded the complaints for processing as individual complaints, pursuant to a request from the Complainants. The Agency issued final decisions on July 8, 1999, dismissing the individual complaints. Complainants appealed the dismissals to the Commission on August 6, 1999. In opposing the appeals, OPM contended that it was not the proper defendant in this case because (1) it does not make decisions on specific health benefits; (2) the Federal Employees Health Benefits Act establishes only the minimum benefits that must be covered; and (3) OPM does not prohibit plans from covering reproductive services. The Commission reversed the Agency's dismissal of the complaints and remanded the complaints for consolidation and further investigation. Complainants v. Office of Personnel Management, EEOC Appeal Nos. 01996217 & 01996553 (Aug. 11, 2000). The Commission held that OPM was the proper defendant in claims concerning the discriminatory denial of health benefits for federal employees because it is the entity responsible for administering the FEHBP. See Klein v. Dep't of Housing and Urban Development, EEOC Appeal No. 01A53675 (Oct. 27, 2005) (dismissing complaint about denial of insurance coverage brought against the Department of Housing and Urban Development and advising Complainant to seek counseling and re-file her complaint against OPM); Haendel v. Office of Personnel Management, EEOC Appeal No. 01963851 (May 1, 1997) (same); Polifko v. Office of Personnel Management, EEOC Appeal No. 05940611 (Jan. 4, 1995) (finding it proper to transfer complaint of discriminatory insurance coverage to OPM for processing because OPM is responsible for negotiating and approving the terms of all insurance plans offered to federal employees). Upon remand, Complainants requested a hearing before an EEOC AJ. The Blue Cross and Blue Shield Association3 sought to intervene. Blue Cross and Blue Shield ultimately pursued this issue in the U.S. District Court for the District of Columbia, which remanded the matter back to the EEOC AJ for reconsideration. The AJ conducted a hearing in 2012 and issued a decision on April 3, 2013. The AJ determined that the ART exclusion in the Blue Cross Blue Shield Plan constituted a disability-based distinction because IVF is nearly exclusively utilized by individuals with the physical impairment of infertility. The AJ also found that the physical impairment of infertility substantially limits the major life activity of reproduction. The AJ concluded that the disability-based exclusion did not, however, violate Section 501 because ART was excluded on the basis that it was not medically necessary, as defined by the Plan. The AJ found credible the testimony of BCBS's Director of OPM Relations who stated that the Plan did not cover ART procedures, including IVF, because such procedures were not considered treatment or care of an illness or injury, but rather, a means of bypassing the illness or injury. For that reason, BCBS did not consider such procedures to be "medically necessary" as required by the Plan. According to the witness, the Plan consistently applied the same principle to exclude coverage of other services, such as erectile dysfunction treatment, eyeglasses, and contact lenses. The witness distinguished ART from covered services such as insulin for diabetes and dialysis for kidney disease by stating that the latter services treated the underlying conditions and were necessary to sustain health. Complainants appealed the AJ's decision after the Agency failed to issue a final decision.4 ANALYSIS AND FINDINGS A. Standard of Review The Commission will uphold an AJ's post-hearing factual findings if they are supported by substantial evidence in the record. 29 C.F.R. § 1614.405(a). Substantial evidence is defined as "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 477 (1951) (citation omitted). In addition, the Commission will accept an AJ's credibility determination based on the demeanor of a witness or on the tone of voice of a witness, unless documents or other objective evidence so contradicts the testimony or the testimony so lacks in credibility that a reasonable fact finder would not credit it. See EEOC Management Directive 110, Chapter 9, at § VI.B. (Aug. 5, 2015). A finding on whether discriminatory intent existed is a factual finding. See Pullman-Standard Co. v. Swint, 456 U.S. 273, 293 (1982). However, the Commission will review de novo an AJ's conclusions of law, whether or not a hearing was held. B. Legal Standards In non-affirmative action discrimination claims, the requirements and defenses of the Americans with Disabilities Act apply to Section 501. See 29 U.S.C. §791(g); 29 C.F.R. § 1614.203. Title I of the ADA prohibits covered entities from discriminating on the basis of disability against a qualified individual with a disability in regard to "employee compensation . . . and other terms, conditions, and privileges of employment." 42 U.S.C. § 12112(a). Section 1614.4(f) of the Commission's regulations implementing the employment provisions of the ADA prohibits covered entities from discriminating on the basis of disability with regard to "[f]ringe benefits available by virtue of employment, whether or not administered by the covered entity." Employee benefit plans, including health insurance plans provided to employees, are a fringe benefit available by virtue of employment. The ADA, and hence Section 501, also prohibits covered entities from entering into, or participating in, a contractual or other arrangement or relationship that has the effect of discriminating against qualified applicants or employees with disabilities. 42 U.S.C. § 12112(b)(2); 29 C.F.R. § 1630.6(a). Contractual or other relationships with organizations that provide fringe benefits to employees are included in this prohibition. 29 C.F.R. § 1630.6(b). OPM is responsible for offering health insurance plans as a fringe benefit of Federal employment. In that role, it approves benefit designs and premium rates, sets rules generally applicable to carriers, adjudicates and orders payment of disputed health claims, and adjusts policies as necessary to ensure compliance with nondiscrimination standards. See 5 U.S.C. § 8901 et seq. C. Disability Based Distinction When a complaint alleges that a health-related term or provision of a health insurance plan violates the Rehabilitation Act, the Commission first examines whether the challenged term or provision is a disability-based distinction. This case arose before January 1, 2009, the effective date of the Americans with Disabilities Act Amendments Act of 2008 (ADAAA). The Commission will therefore use the analytical framework as it existed before the enactment of the ADAAA. We find there is substantial evidence in the record to support the finding that the wife's infertility constituted a disability. The medical records indicate that the wife was missing one ovary and two fallopian tubes, and that her doctor diagnosed her with medical infertility and informed her she would need medical treatment in order to reproduce. See Bragdon v. Abbott, 524 U.S. 624 (1998) (holding that reproduction is a major life activity under the ADA). The challenged exclusion of ART at issue in this case was a disability-based distinction because, as the AJ correctly found, during the relevant time period, IVF procedures were nearly exclusively utilized by individuals with the physical impairment of infertility. The Agency argued that the exclusion of IVF was not disability-based because IVF was treated in a manner consistent with BCBS's policy of excluding treatments that are not "medically necessary." Consistent with the Plan's brochure and Manual, BCBS's Director of OPM Relations from 1997 to 2000 testified that IVF was excluded because it did not meet the Plan's definition of "medically necessary" in that it does not "treat the underlying condition or illness." Hearing transcript at 918. The AJ credited the Director's testimony. Our examination of the provisions of the Plan's brochure reveals that the Plan inconsistently and arbitrarily applied its definition of "medically necessary" to exclude IVF while covering other similar treatments. In addition, OPM's Chief of the Office of Insurance Programs and BCBS's Director of OPM Relations acknowledged that the Plan paid for other services that, like IVF, do not cure the underlying medical condition. Id. at 369-370, 934-935. We therefore determine that the AJ's finding that the exclusion was based on medical necessity is not supported by substantial evidence. D. The Safe Harbor Insurance Provision of the ADA The central question in this case is whether the disability-based exclusion of IVF coverage falls within the "safe harbor" insurance provision of the ADA, as applied to Section 501 of the Rehabilitation Act. The relevant section for this case is Section 501(c)(3) that provides that the law "shall not be construed to prohibit or restrict a person or organization covered by this chapter from establishing, sponsoring, observing or administering the terms of a bona fide benefit plan that is not subject to State laws that regulate insurance."5 This provision is modified by the proviso that it "not be used as a subterfuge to evade the purposes of [the titles of the ADA]."6 The Agency may prove that its disability-based exclusion of IVF treatment is not a subterfuge because it is justified, inter alia, by legitimate actuarial data, or by actual or reasonably anticipated experience.7 In support of their position that the exclusion of IVF was not disability-based, OPM and BCBS relied on an April 30, 2010 actuarial analysis by the BCBS Association's Chief Actuary. The AJ was not persuaded by the analysis, however, because it was performed nearly forty years after BCBS first began excluding ART services, in as early as 1973. The AJ concluded that, as a result, it "provides no meaningful insight" into the rationale for excluding ART at the time the exclusion-decision was made and therefore could not be used to justify the disability-based distinction. [Willia M. and Alonzo N.] v. OPM, EEOC Case Nos. 100-A2-7218X and 100-A2-7219X (Apr. 3, 2013) (AJ decision), fn. 41. Upon review, we find that OPM failed to provide sufficient evidence or testimony to establish the basis for the 1998-2000 exclusion of ART from coverage. OPM provided no evidence that the disability-based distinction that was in effect from 1998 to 2000 was attributable to, inter alia, any application of legitimate risk classification, underwriting procedures, or verifiable actuarial data. See, e.g., E.E.O.C. v. Sears Roebuck and Co., 243 F.3d 846, 853 (4th Cir. 2001) (stating that "a factfinder could infer from the late appearance of [the employer's] current justification that it is a post-hoc rationale, not a legitimate explanation for [the employer's] decision . . . .") (citing Tyler v. Re/Max Mountain States, Inc., 232 F.3d 808, 813 (10th Cir. 2000) ("We are disquieted . . . by an employer who 'fully' articulates its reasons for the first time months after the decision was made.")); University Hospitals of Cleveland v. Emerson Elec. Co., 202 F.3d 839, 848 n.7 (6th Cir. 2000) ("[I]t strikes us as problematic to . . . allow the [plan] administrator to 'shore up' a decision after-the-fact by testifying as to the 'true' basis for the decision after the matter is in litigation, possible deficiencies in the decision are identified, and an attorney is consulted to defend the decision by developing creative post hoc arguments that can survive deferential review. The concerns inherent in this scenario are even more pronounced where, as here, the administrator has a financial incentive to deny benefits."). In addition, because OPM could not obtain any relevant data for the time-period in question, the study offers no predictions or relevant insights into the potential effect on the Plan had it covered ART from 1998 to 2000. See Polifko v. Office of Personnel Mngt, EEOC Appeal No. 01960976 (holding that the "agency made no argument and presented no evidence establishing that the disability-based distinction was attributable to the application of legitimate risk classification and underwriting procedures....). CONCLUSION Based on an exhaustive review of the record and the contentions on appeal, including those not specifically addressed here, we find that the Agency violated the Rehabilitation Act when it contracted for employee health benefits with an insurance carrier that discriminated against Complainants on the bases of disability (infertility) and disability by association in the provision of health care insurance coverage. The Agency did not meet its burden of showing that the health insurance plan's 1998-2000 exclusion of IVF from coverage was based on sound actuarial principles or related to actual or reasonably anticipated experience, or otherwise justified as not medically necessary. We therefore REVERSE the AJ's decision, and REMAND the matter for a determination of appropriate remedies including, but not limited to, compensatory damages and attorney's fees. ORDER Within fifteen (15) calendar days of the date this decision becomes final, the Agency shall submit a copy of this decision and the complaint file to the EEOC AJ who initially adjudicated this case in the Hearings Unit of the Washington Field Office. The Agency shall provide written notification to the Compliance Officer at the address set forth below that the complaint file has been transmitted to the Hearings Unit. Thereafter, the AJ shall hold a hearing on appropriate remedies, including, but not limited to, compensatory damages, attorney's fees and costs, and training for responsible Agency management officials, and issue a decision on remedies, in accordance with 29 C.F.R. § 1614.109. The Agency shall then issue a final action, in accordance with 29 C.F.R. § 1614.110. POSTING ORDER (G0617) The Agency is ordered to post at its Office of Health Care and Insurance and Office of the Actuaries in Washington, D.C., copies of the attached notice. Copies of the notice, after being signed by the Agency's duly authorized representative, shall be posted both in hard copy and electronic format by the Agency within 30 calendar days of the date this decision was issued, and shall remain posted for 60 consecutive days, in conspicuous places, including all places where notices to employees are customarily posted. The Agency shall take reasonable steps to ensure that said notices are not altered, defaced, or covered by any other material. The original signed notice is to be submitted to the Compliance Officer as directed in the paragraph entitled "Implementation of the Commission's Decision," within 10 calendar days of the expiration of the posting period. The report must be in digital format, and must be submitted via the Federal Sector EEO Portal (FedSEP). See 29 C.F.R. § 1614.403(g). ATTORNEY'S FEES (H1016) If Complainant has been represented by an attorney (as defined by 29 C.F.R. § 1614.501(e)(1)(iii)), he or she is entitled to an award of reasonable attorney's fees incurred in the processing of the complaint. 29 C.F.R. § 1614.501(e). The award of attorney's fees shall be paid by the Agency. The attorney shall submit a verified statement of fees to the Agency -- not to the Equal Employment Opportunity Commission, Office of Federal Operations -- within thirty (30) calendar days of the date this decision was issued. The Agency shall then process the claim for attorney's fees in accordance with 29 C.F.R. § 1614.501. IMPLEMENTATION OF THE COMMISSION'S DECISION (K0617) Compliance with the Commission's corrective action is mandatory. The Agency shall submit its compliance report within thirty (30) calendar days of the completion of all ordered corrective action. The report shall be in the digital format required by the Commission, and submitted via the Federal Sector EEO Portal (FedSEP). See 29 C.F.R. § 1614.403(g). The Agency's report must contain supporting documentation, and the Agency must send a copy of all submissions to the Complainant. If the Agency does not comply with the Commission's order, the Complainant may petition the Commission for enforcement of the order. 29 C.F.R. § 1614.503(a). The Complainant also has the right to file a civil action to enforce compliance with the Commission's order prior to or following an administrative petition for enforcement. See 29 C.F.R. §§ 1614.407, 1614.408, and 29 C.F.R. § 1614.503(g). Alternatively, the Complainant has the right to file a civil action on the underlying complaint in accordance with the paragraph below entitled "Right to File a Civil Action." 29 C.F.R. §§ 1614.407 and 1614.408. A civil action for enforcement or a civil action on the underlying complaint is subject to the deadline stated in 42 U.S.C. 2000e-16(c) (1994 & Supp. IV 1999). If the Complainant files a civil action, the administrative processing of the complaint, including any petition for enforcement, will be terminated. See 29 C.F.R. § 1614.409. STATEMENT OF RIGHTS - ON APPEAL RECONSIDERATION (M0617) The Commission may, in its discretion, reconsider the decision in this case if the Complainant or the Agency submits a written request containing arguments or evidence which tend to establish that: 1. The appellate decision involved a clearly erroneous interpretation of material fact or law; or 2. The appellate decision will have a substantial impact on the policies, practices, or operations of the Agency. Requests to reconsider, with supporting statement or brief, must be filed with the Office of Federal Operations (OFO) within thirty (30) calendar days of receipt of this decision. A party shall have twenty (20) calendar days of receipt of another party's timely request for reconsideration in which to submit a brief or statement in opposition. See 29 C.F.R. § 1614.405; Equal Employment Opportunity Management Directive for 29 C.F.R. Part 1614 (EEO MD-110), at Chap. 9 § VII.B (Aug. 5, 2015). All requests and arguments must be submitted to the Director, Office of Federal Operations, Equal Employment Opportunity Commission. Complainant's request may be submitted via regular mail to P.O. Box 77960, Washington, DC 20013, or by certified mail to 131 M Street, NE, Washington, DC 20507. In the absence of a legible postmark, the request to reconsider shall be deemed timely filed if it is received by mail within five days of the expiration of the applicable filing period. See 29 C.F.R. § 1614.604. The agency's request must be submitted in digital format via the EEOC's Federal Sector EEO Portal (FedSEP). See 29 C.F.R. § 1614.403(g). The request or opposition must also include proof of service on the other party. Failure to file within the time period will result in dismissal of your request for reconsideration as untimely, unless extenuating circumstances prevented the timely filing of the request. Any supporting documentation must be submitted with your request for reconsideration. The Commission will consider requests for reconsideration filed after the deadline only in very limited circumstances. See 29 C.F.R. § 1614.604(c). COMPLAINANTS' RIGHT TO FILE A CIVIL ACTION (R0610) This is a decision requiring the Agency to continue its administrative processing of your complaint. However, if you wish to file a civil action, you have the right to file such action in an appropriate United States District Court within ninety (90) calendar days from the date that you receive this decision. In the alternative, you may file a civil action after one hundred and eighty (180) calendar days of the date you filed your complaint with the Agency, or filed your appeal with the Commission. If you file a civil action, you must name as the defendant in the complaint the person who is the official Agency head or department head, identifying that person by his or her full name and official title. Failure to do so may result in the dismissal of your case in court. "Agency" or "department" means the national organization, and not the local office, facility or department in which you work. Filing a civil action will terminate the administrative processing of your complaint. RIGHT TO REQUEST COUNSEL (Z0815) If you want to file a civil action but cannot pay the fees, costs, or security to do so, you may request permission from the court to proceed with the civil action without paying these fees or costs. Similarly, if you cannot afford an attorney to represent you in the civil action, you may request the court to appoint an attorney for you. You must submit the requests for waiver of court costs or appointment of an attorney directly to the court, not the Commission. The court has the sole discretion to grant or deny these types of requests. Such requests do not alter the time limits for filing a civil action (please read the paragraph titled Complainant's Right to File a Civil Action for the specific time limits). FOR THE COMMISSION: _____________________________ Bernadette B. Wilson's signature Bernadette B. Wilson Executive Officer Executive Secretariat _12/21/18_________________ Date 1 These cases have been randomly assigned pseudonyms that will replace Complainants' names when the decisions are published to non-parties and the Commission's website. 2 OPM issued a subsequent call letter in April 1999 that repeated the same requirements and exclusions of coverage for infertility treatments. 3 Blue Cross and Blue Shield Association is a national organization that represents and lends the "Blue Cross and Blue Shield" name and trademark to individual health insurance plans throughout the country. In order to be part of the Blue Cross and Blue Shield system and use its name and trademark, affiliated plans must follow certain policies and requirements of the national organization. For purposes of participating in the Federal Employees Health Benefits Program, the national organization negotiates with OPM for one benefit package and premium, and all affiliates participate and offer the federal benefit package at the same premium. Carolyn L. Merck, Health Insurance for Federal Employees and Retirees in HEALTH INSURANCE CURRENT ISSUES AND BACKGROUND 94 n. 5 (Nova Science Publishers, NY 2003). For purposes of this decision, we will refer to Blue Cross and Blue Shield Association simply as "Blue Cross and Blue Shield." 4 If an agency does not issue a final order within forty (40) days of receipt of the AJ's decision, then the decision becomes the final action of the agency. 29 C.F.R. § 1614.109(i). 5 To be a bona fide plan, a plan must exist, pay benefits, and accurately communicate the terms of the plan to eligible employees. The parties do not dispute that the BCBS Plan meets these requirements. The BCBS Plan is also not subject to State laws that regulate insurance because it is a national plan, established pursuant to OPM's authority under the Federal Employee Health Benefits Act (FEHBA), which includes a clause that preempts national plans from state or local insurance regulation. See 5 U.S.C. § 8902(m)(1). 6 The full text Section 501(c) provides that the ADA "shall not be construed to prohibit or restrict- 1) an insurer; hospital or medical service company, health maintenance organization, or any agent, or entity that administers benefits plans, or similar organizations from underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with State law; or 2) a person or organization covered by this Act from establishing, sponsoring, observing or administering the terms of a bona fide benefits plan that are based on underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with State law; or 3) a person or organization covered by this chapter from establishing, sponsoring, observing or administering the terms of a bona fide benefit plan that is not subject to State laws that regulate insurance. Paragraphs (1), (2), and (3) shall not be used as a subterfuge to evade the purposes of [titles I and III of the Act]." 7 EEOC Compliance Manual, Chapter 3: Employee Benefits, EEOC No. 915.003 (Oct. 3, 2000). --------------- ------------------------------------------------------------ --------------- ------------------------------------------------------------ 2 0120132419 12 0120132419, 0120132420