text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Federal Employee Short-Term 
  Disability Insurance Act of 2011''.
  
  SEC. 2. PURPOSE.
  
      The purpose of this Act is to offer voluntary insurance to Federal 
  employees for protection against the loss of pay resulting from--
              (1) short-term injury or disability;
              (2) short-term leave taken for the purpose of caring for a 
          family member;
              (3) the birth of a child of such an employee; or
              (4) making arrangements to adopt a child or to become a 
          foster parent.
  
  SEC. 3. NON-WORK RELATED DISABILITY INSURANCE.
  
      (a) In General.--Title 5, United States Code, is amended by 
  inserting after chapter 87 the following:
  
       ``CHAPTER 88--NON-WORK RELATED SHORT-TERM DISABILITY INSURANCE
  
  ``Sec.
  ``8801. Definitions.
  ``8802. Availability of insurance.
  ``8803. Contracting authority.
  ``8804. Benefits.
  ``8805. Premiums.
  ``8806. Preemption.
  ``8807. Studies, reports, and audits.
  ``8808. Jurisdiction of courts.
  ``8809. Administrative functions.
  ``8810. Cost accounting standards.
  ``Sec. 8801. Definitions
      ``For purposes of this chapter--
              ``(1) the term `Director' means the Director of the Office 
          of Personnel Management;
              ``(2) the term `employee' means--
                      ``(A) an employee defined in section 8901(1); and
                      ``(B) an officer or employee of the United States 
                  Postal Service or of the Postal Regulatory Commission;
              ``(3) the term `injury or disability', with respect to an 
          employee, means that such employee is unable to perform the 
          essential functions of such employee's position of employment 
          with the Federal Government;
              ``(4) the term `member of family' has the meaning given 
          such term in section 8901(5);
              ``(5) the term `carrier' means an insurance company that is 
          licensed to issue disability insurance in all States, taking 
          into account any subsidiaries or affiliates of such a company; 
          and
              ``(6) the term `State' includes the District of Columbia.
  ``Sec. 8802. Availability of insurance
      ``(a) The Director shall establish and administer a program to make 
  insurance coverage available under this chapter--
              ``(1) for an injury or disability not covered under chapter 
          81;
              ``(2) for leave to care for, or leave to make arrangements 
          to care for, a member of family, including the birth of a son 
          or a daughter; and
              ``(3) for leave to make arrangements--
                      ``(A) to become a foster parent; or
                      ``(B) to adopt a child.
      ``(b) Insurance shall not be available under this chapter if the 
  injury or disability of an employee is--
              ``(1) caused by willful misconduct of such employee;
              ``(2) caused by such employee's intention to bring about 
          such injury or disability to himself or to another individual; 
          or
              ``(3) proximately caused by the intoxication of such 
          employee.
      ``(c) In addition to the requirements otherwise applicable under 
  section 8801(5), an insurance contract under this chapter must be fully 
  insured, whether through reinsurance with other carriers or otherwise.
  ``Sec. 8803. Contracting authority
      ``(a) The Director shall, without regard to any statute requiring 
  competitive bidding, contract with one or more carriers for a policy or 
  policies of disability insurance as described under this chapter. The 
  Director shall ensure that each resulting contract is awarded on the 
  basis of contractor qualifications, price, and reasonable competition.
      ``(b)(1) Each contract under this section shall contain--
              ``(A) a detailed statement of the benefits offered 
          (including any maximums, limitations, exclusions, and other 
          definitions of benefits);
              ``(B) the premiums charged (including any limitations or 
          other conditions on their subsequent adjustment);
              ``(C) the duration of the enrollment period; and
              ``(D) such other terms and conditions (including procedures 
          for establishing eligibility for insurance under this chapter) 
          as may be determined by the Director, consistent with the 
          requirements of this chapter.
      ``(2) Premiums charged under a contract under this section shall 
  reasonably and equitably reflect the cost of the benefits provided, as 
  determined by the Director.
      ``(c)(1) Each contract under this section shall require the 
  carrier--
              ``(A) to provide payments or benefits described in section 
          8804(c) to an employee if such employee is entitled thereto 
          under the terms of the contract; and
              ``(B) with respect to disputes regarding claims for 
          payments or benefits under the terms of the contract--
                      ``(i) to establish internal procedures designed to 
                  resolve such disputes expeditiously; and
                      ``(ii) to establish, for disputes not resolved 
                  through procedures under clause (i), procedures for one 
                  or more alternative means of dispute resolution 
                  involving independent third-party review under 
                  circumstances acceptable to the Director.
      ``(2) The carrier's determination as to whether or not a particular 
  employee is eligible to obtain insurance coverage under this chapter 
  shall be subject to review to the extent and in the manner provided in 
  the applicable contract.
      ``(3) Nothing in this chapter shall be considered to grant 
  authority for a third-party reviewer to change the terms of any 
  contract under this chapter.
      ``(d)(1) Each contract under this section shall be for a term of 
  not less than 3 years and not greater than 7 years, and may be 
  terminated earlier than the termination date of such contract by the 
  Director in accordance with the terms of such contract. However, the 
  rights and responsibilities of the enrolled employee, the insurer, and 
  the Director under each contract shall continue with respect to such 
  employee until the termination of coverage of the enrolled employee or 
  the effective date of a successor contract.
      ``(2) A contract described in paragraph (1) may be made 
  automatically renewable, for a term of 1 year each January 1, unless 
  written notice of non-renewal is given either by the Director or the 
  carrier not less than 180 days before the renewal date, or unless 
  modified by mutual agreement.
      ``(3) A contract described in paragraph (1) shall include such 
  provisions as may be necessary to ensure that, once an employee becomes 
  duly enrolled, insurance coverage pursuant to that enrollment shall be 
  terminated only if the individual is separated from Federal service or, 
  where appropriate, for non-payment of premiums.
  ``Sec. 8804. Benefits
      ``(a) The Director may prescribe reasonable minimum standards for 
  benefit plans offered under this chapter.
      ``(b)(1) Benefits provided to an employee under this chapter shall 
  offset other benefits received by such employee for the same injury or 
  disability, leave to care for or make arrangements to care for a member 
  of family (including the birth of a son or a daughter), or leave to 
  make arrangements to adopt a child or become a foster parent including 
  worker's compensation and disability retirement income.
      ``(2) A contract providing benefits under this chapter--
              ``(A) shall not provide for a preexisting condition 
          exclusion; and
              ``(B) shall not charge higher premiums, deny coverage, or 
          drop coverage of an employee with a preexisting condition.
      ``(3) A contract providing benefits under this chapter shall 
  provide incentives for an employee who is receiving benefits under such 
  contract to return to work.
      ``(c)(1) For each instance that such employee suffers an injury or 
  disability, takes leave to care for or make arrangements to care for a 
  member of family (including the birth of a son or a daughter), or takes 
  leave to make arrangements to adopt a child or become a foster parent, 
  and is eligible for benefits under this chapter, such employee may 
  receive benefits under this chapter for a period not to exceed 12 
  months beginning on the date on which such employee qualifies for such 
  benefits. An employee shall receive such benefits after the expiration 
  of the waiting period selected by such employee under paragraph (2)(A). 
  The amount of benefits shall be equal to the lesser of--
              ``(A) 70 percent of the annual rate of pay, excluding 
          bonuses, of an employee at the time of the injury or disability 
          of such employee occurs; or
              ``(B) 70 percent of the maximum rate of basic pay provided 
          for grade GS-15 of the General Schedule.
      ``(2)(A) The period for which benefits are payable to an employee 
  under this subsection shall begin after the completion of a waiting 
  period, subject to the requirement in subparagraph (C). An employee 
  shall elect one of the following waiting period options:
              ``(i) On the 8th day of continuous injury or disability, 
          leave to care for or to make arrangements to care for a member 
          of family (including the birth of a son or a daughter), or 
          leave to make arrangements to adopt a child or become a foster 
          parent.
              ``(ii) On the 31st day of continuous disability, leave to 
          care for or to make arrangements to care for a member of family 
          (including the birth of a son or a daughter), or leave to make 
          arrangements to adopt a child or become a foster parent.
              ``(iii) On the 91st day of continuous disability, leave to 
          care for or to make arrangements to care for a member of family 
          (including the birth of a son or a daughter), or leave to make 
          arrangements to adopt a child or become a foster parent.
              ``(iv) On the 181st day of continuous disability, leave to 
          care for or to make arrangements to care for a member of family 
          (including the birth of a son or a daughter), or leave to make 
          arrangements to adopt a child or become a foster parent.
      ``(B) An employee who elects to receive benefits earlier shall pay 
  a higher premium.
      ``(C) A waiting period selected under subparagraph (A) shall begin 
  on the first day of an employee's injury or disability.
  ``Sec. 8805. Premiums
      ``(a) Each eligible individual obtaining insurance coverage under 
  this chapter shall be responsible for 100 percent of the premiums for 
  such coverage.
      ``(b) The amount necessary to pay the premiums for enrollment shall 
  be withheld from the pay of the enrolled individual.
      ``(c) The carrier participating under this chapter shall maintain 
  records that permit it to account for all amounts received under this 
  chapter (including investment earnings on those amounts) separate and 
  apart from all other funds.
      ``(d)(1)(A) The Employees' Life Insurance Fund is available, 
  without fiscal year limitation, for reasonable expenses incurred in 
  administering this chapter before the start of the first term described 
  in section 8803(d)(1), including reasonable implementation costs.
      ``(B) Such Fund shall be reimbursed, before the end of the first 
  year of a contract described in section 8803(d)(1), for all amounts 
  obligated or expended under subparagraph (A) (including lost investment 
  income). Reimbursement under this subparagraph shall be made by the 
  carrier in accordance with applicable provisions included in the 
  relevant contract.
      ``(C)(i) There is hereby established in the Employees' Life 
  Insurance Fund a Non-Work Related Disability Insurance Administrative 
  Account, which shall be available to the Office of Personnel 
  Management, without fiscal year limitation, to defray reasonable 
  expenses incurred by the Office in administering this chapter after the 
  start of the first term described in section 8803(d)(1).
      ``(ii) A contract under this chapter shall include appropriate 
  provisions under which the carrier involved shall, during each year, 
  make such periodic contributions to the Non-Work Related Disability 
  Insurance Administrative Account as necessary to ensure that the 
  reasonable anticipated expenses of the Office of Personnel Management 
  in administering this chapter during such year (adjusted to reconcile 
  for any earlier overestimates or underestimates under this 
  subparagraph) are defrayed.
      ``(e) Nothing in this chapter shall, in the case of an enrolled 
  individual applying for an extension of insurance coverage under this 
  chapter after the expiration of such enrolled individual's first 
  opportunity to enroll, preclude the application of underwriting 
  standards for later enrollment.
  ``Sec. 8806. Preemption
      ``(a) 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, territorial, tribal, or local law, or any regulation issued 
  thereunder, which relates to non-work related disability insurance or 
  contracts.
      ``(b)(1) No tax, fee, or other monetary payment may be imposed or 
  collected, directly or indirectly, by any State, territory, tribe, or 
  locality, or by any political subdivision or other governmental 
  authority thereof, on, or with respect to, any premium paid for an 
  insurance policy under this chapter.
      ``(2) Paragraph (1) shall not be construed to exempt any company or 
  other entity issuing a policy of insurance under this chapter from the 
  imposition, payment, or collection of a tax, fee, or other monetary 
  payment on the net income or profit accruing to or realized by such 
  entity from business conducted under this chapter, if that tax, fee, or 
  payment is applicable to a broad range of business activity.
      ``(c) No law of a State, territory, tribe, or locality, pertaining 
  to subrogation or reimbursement with respect to benefits provided under 
  this chapter, shall operate except as expressly adopted by the 
  Director.
  ``Sec. 8807. Studies, reports, and audits
      ``(a) A contract under this chapter shall contain provisions 
  requiring the carrier to furnish such reasonable reports as the 
  Director determines to be necessary to enable the Director to carry out 
  the Director's functions under this chapter.
      ``(b) Each Federal agency shall keep such records, make such 
  certifications, and furnish the Director, the carrier, or both, with 
  such information and reports as the Director may require.
      ``(c) The Director shall conduct periodic reviews of each plan 
  under this chapter to ensure its competitiveness.
  ``Sec. 8808. Jurisdiction of courts
      ``The district courts of the United States have original 
  jurisdiction, concurrent with the United States Court of Federal 
  Claims, of a civil action or claim against the United States under this 
  chapter after such administrative remedies as required under section 
  8803(c) have been exhausted, but only to the extent judicial review is 
  not precluded by any dispute resolution or other remedy under this 
  chapter.
  ``Sec. 8809. Administrative functions
      ``(a)(1) Except as otherwise provided in this chapter, the Director 
  shall prescribe regulations necessary to carry out this chapter and to 
  make arrangements as necessary with other agencies and payroll systems 
  to implement the program.
      ``(2) Except as otherwise provided by law, the Director shall 
  specify in regulation the treatment of time spent by an individual in 
  receipt of benefits under this chapter for the purposes of periodic 
  increases in pay, retention purposes, and other rights, benefits, and 
  conditions of employment for which length of service is a factor.
      ``(b) The carrier shall provide for periodic coordinated 
  enrollment, promotion, and education efforts, as specified by the 
  Director.
  ``Sec. 8810. Cost accounting standards
      ``The cost accounting standards issued pursuant to section 1502 of 
  title 41 shall not apply with respect to an insurance contract under 
  this chapter.''.
      (b) Conforming Amendment.--Section 1005(f) of title 39, United 
  States Code, is amended by inserting ``88,'' after ``87,''.
      (c) Clerical Amendment.--The analysis for part III of title 5, 
  United States Code, is amended by adding at the end of subpart G the 
  following:
  
  ``88. Non-Work Related Short-Term Disability Insurance......    8801''.
      (d) Date of Application.--The amendment made by subsection (a) 
  shall apply to contracts that take effect with respect to the first 
  calender year that begins more than 18 months after the date of 
  enactment of this section.
target: Federal Employee Short-Term Disability Insurance Act of 2011 - Requires the Director of the Office of Personnel Management (OPM) to establish and administer a program for short-term (i.e., up to 12 months) disability insurance coverage for federal employees for: (1) an injury or disability that is not work related, (2) leave to care for a family member, and (3) leave to make arrangements to become a foster parent or to adopt a child. Disqualifies an employee for such insurance if an injury or disability is caused by willful misconduct, a self-inflicted injury, or intoxication.
  
  Requires the Director to contract with one or more insurance carriers for disability insurance coverage plans, without regard to competitive bidding requirements. Requires such plans to contain a detailed statement of benefits offered, the premiums charged, and the duration of the enrollment period.
  
  Authorizes the Director to prescribe reasonable minimum standards for benefits offered by such plans, including a prohibition against excluding or penalizing an employee for a preexisting condition.
  
  Requires individuals eligible for coverage under a disability insurance plan to be responsible for 100% of the premiums for the coverage offered.
  
  Establishes in the Employees' Life Insurance Fund a Non-Work Related Disability Insurance Administrative Account, which shall be available to OPM to defray reasonable expenses incurred in administering this Act and to which contracted carriers shall make contributions necessary to cover such expenses.
feat_title: To provide a short-term disability insurance program for Federal employees for disabilities that are not work-related, and for other purposes.