It also provides procedures for implementing and supplementing the FPR and Chapter 16 and sets forth deviation procedures.

§ 16-1.102 Purpose.

Chapter 16 is prescribed by the Director, Office of Personnel Management to provide direction and uniformity in the agency's procurement of health coverage under the FEHB Program.

§ 16-1.103 Authority.

Chapter 16 is issued under the authority of 5 U.S.C. Chapter 89 and 40 U.S.C. 486(c).

§ 16-1.104 Relationship of Chapter 16 to the FPR.

(a) The Federal Procurement Regulations set forth in Chapter 1, 41 CFR are applicable to contracts between the Office of Personnel Management (OPM) and health benefits plans for Federal employees and annuitants. Chapter 16 provides guidance to the contracting officer, health benefit carriers and other interested parties for implementing, supplementing and in certain instances, deviating from the FPR. Except as necessary to assure continuity or understanding, material published in the FPR will not be repeated, paraphrased, or otherwise restated in Chapter 16.

(b) Implementing material is that which expands upon related FPR material. Supplementing material is that for which there is no counterpart in the FPR.

(c) Material in Chapter 16 may supersede the FPR as when deviation (see OPMPR 16-1.109-1) is authorized, but only when the deviation contains an explicit cross reference to the FPR. (d) In order to make FEHBP carriers fully aware of which portions of the FPR are applicable to contracts with FEHBP, and to establish official OPM policy for internal contract evaluations, all parts of 41 CFR Chapter 1 which are deemed to have practical application to the administration of FEHBP contracts are specifically dealt with in this Chapter 16. Any portions of the FPR which, because of a change in the contracting procedure under the Program, become practical

to apply at a future date will be published in the FEDERAL REGISTER prior to implementation by OPM.

§ 16-1.106 Issuance.

(a) Policies and procedures which are issued in this chapter will be published in the FEDERAL REGISTER as Chapter 16 of Title 41 CFR.

(b) The FEDERAL REGISTER and Title 41 CFR may be purchased by the public from the Superintendent of Documents, Government Printing Office, Washington, D.C. 20402.

§ 16-1.107 Arrangement.

§ 16-1.107-1 General plan.

Chapter 16 conforms with the FPR system with respect to divisional arrangements into parts, subparts, sections, subsections, and further subdivisions as necessary.

§ 16-1.107-2 Numbering.

(a) Generally, the numbering system used in Chapter 16 conforms to that of Chapter 1 (see FPR 1-1.007-2). Thus, a particular procurement policy or procedure is identified by the same number in both Chapter 1 and Chapter 16, except that the first number in Chapter 1 will be 1 rather than 16.

(b) Where Chapter 16 implements a part, subpart, section or subsection of the FPR, the implementing part, subpart, section or subsection of Chapter 16 is numbered to correspond to the FPR part, subpart, section or subsection, e.g., § 16-3.807-3 implements § 13.807-3 of the FPR. Paragraph and subparagraph designations of Chapter 16, however, are independently developed and do not necessarily correspond to a paragraph or subparagraph of the FPR.

(c) Where Chapter 16 supplements the FPR and thus deals with subject matter not contained in the FPR, the numbers in the group 50 through 99 are assigned to the respective supplementing parts, subparts or sections.

(d) Where the subject matter contained in the part, subpart, section or subsection of the FPR has no practical application at this time to FEHBP contracts, this Chapter 16 contains no corresponding part, subpart, section or

(3) Section 1-3.807-50(a). The word "section" or its symbol (§) is used in making a cross reference even though the reference may be to a subsection, paragraph or subparagraph. For example, this reference is actually to a paragraph.

(b) Within Chapter 16, cross reference to parts, subparts and sections of Chapter 16 will be in a manner generally similar to that used in making references to the FPR. For example, this paragraph would be referred to as § 16-1.107-4(b).

§ 16-1.108 Implementation.

As portions of the FPR are prescribed, procurement policies and procedures which have practical application to the FPR will be issued in Chapter 16 by the Director, Office of Personnel Management.

§ 16-1.109 Deviation.

§ 16-1.109-1 Description.

(a) The term "deviation" as used in Chapter 16 is defined in the same manner as described in FPR 1-1.009-1.

(b) In order to maintain uniformity to the greatest extent feasible, deviation from the FPR will be kept to a minimum.

§ 16-1.150 Use of designees.

Throughout the regulations in Chapter 16, responsibilities and duties are assigned to certain individuals by position title, and, in many instances, the submission of reports to and by these individuals is also prescribed. Whenever these titles are used, the individual occupying these positions may, unless otherwise restricted by law or the regulations in 5 CFR Part 890 or this Chapter 16, designate a subordinate to act for him or her.

Subpart 16-1.2—Definition of Terms § 16-1.250 Definitions.

Definitions pertaining to this Chapter 16 are contained in Part 16-4, "Special Types and Methods of Procurement."

Subpart 16-1.3-General Policies

§ 16-1.301 Method of procurement. § 16-1.301-3 Negotiation.

Use of formal advertising in connection with the award of FEHBP contracts is determined not to be feasible or practicable. Pub. L. 86-382, as amended and codified at 5 U.S.C. chapter 89, authorizes the negotiation of FEHBP contracts. FEHBP contracts, accordingly, will be negotiated pursuant to the provisions of FPR 13.215 and the authority in 41 U.S.C. 252(c)(15) which permits the negotiation of contracts "otherwise authorized by law."

§ 16-1.302 Procurement sources.

§ 16-1.302-1 Who may contract.

The OPM may contract with health benefits carriers for plans meeting the requirements of 5 U.S.C. Chapter 89, 5 CFR Part 890, and this Chapter 16 for the provision of health coverage.

§ 16-1.302-3 Contracts between the Government and Government employees or business concerns substantially owned or controlled by Government employ

ees.

FPR 1-1.302-3 is applicable to the administration of the FEHBP contracts. Except where OPM is directed by statute to contract with Government employees.

§ 16-1.303 Approval signatures.

FPR 1-1.303 is applicable to the administration of the FEHBP contracts.

§ 16-1.313 Records of contract actions.

FPR 1-1.313 is applicable to the administration of the FEHBP contracts. § 16-1.318 Disputes.

FPR 1-1.318 is applicable to FEHBP contracts and a clause conforming in substance to the Disputes clause set forth in OPMPR 16-7.502-2 shall be included in all FEHBP contracts.

§ 16-1.320 Subcontractor gifts and kickbacks.

FPR 1-1.320 is applicable to the administration of the FEHBP contracts.

§ 16-1.323 Preference for U.S. Flag Air Carriers.

FPR 1-1.323 is applicable to the administration of the FEHBP contracts. § 16-1.328 Fraudulent claims.

FPR 1-1.328 is applicable to the administration of the FEHBP contracts. § 16-1.341 Reporting Contract Actions (Federal Procurement Data System). (a) The contracting officer shall comply with FPR 1-1.341 set out in Temporary Regulation 48 by submitting Standard Form 279, "Federal Procurement Data Systems Individual Contract Action Report (Over $10,000)" or Standard Form 281, "Fed

eral Procurement Data System Sum of Contract Actions of $10,000 or Less and Subcontract Data on Selected Prime Contracts", as appropriate, to the Administrative Services Division, Acquisition Branch, for each procurement action.

(b) Costs under FEHB contracts include those for (1) carrier's administrative expenses, (2) a service charge for carriers and (3) benefit costs. The first two categories of costs reflect the costs for operating the Program under contract and shall be reported on Standard Form 279. Benefit costs are compensation expenses of an employer/employee relationship and shall be reported by OPM as a part of its annual reports on Federal employee compensation.

(c) FEHBP contract awards take place only during the first quarter of the calendar year. Dollar values reported on Standard Form 279 shall be the amounts of such costs estimated for the coming year during the rate setting process for experience rated carriers. For community rated carriers, such costs shall be actuarily estimated as a percentage of total subscription income.

Subpart 16-1.4-Procurement Responsibility and Authority

§ 16-1.400 Scope of subpart.

This subpart sets forth the authority of the Director, Office of Personnel Management and the FEHBP contracting officer.

§ 16-1.401 Responsibility of the Director, Office of Personnel Management.

The director is responsible for approval of the basic policies affecting the administration of the FEHB law and issuance of regulations implementing these policies.

§ 16-1.402 Authority of the FEHBP contracting officer.

The FEHBP contracting officer is authorized to enter into and administer FEHBP contracts on behalf of the Government and make related findings and determinations within the limitations of his or her prescribed duties and authority. In the exercise

of such authority, the FEHBP contracting officer is subject to the requirements in FPR 1-1.403 and any further requirements, consistent with the Federal Procurement Regulations, imposed by OPM.

§ 16-1.403 Requirements to be met before entering into contracts.

No contract shall be entered into unless all applicable requirements of law, Executive Orders and regulations have been met. The term "regulations" includes those issued by any regulatory agency whether or not incorporated or referenced in the Federal Procurement Regulations.

§ 16-1.405 Ratification of unauthorized contract awards.

FPR 1-1.405 is applicable to the administration of the FEHBP contracts.

§ 16-1.406 Cost accounting standards.

FPR 1-1.406 is applicable to the administration of the FEHBP contracts (see OPMPR 16-3.12).

Subpart 16-1.5-Contingent Fees

§ 16-1.500 Scope of subpart.

FPR 1-1.5 is applicable to the administration of FEHBP contracts.

Subpart 16-1.6-Debarred, Suspended, and Ineligible Carriers

§ 16-1.600 Scope of subpart.

This subpart sets forth OPM's policy with regard to the debarment, suspension and ineligibility of carriers.

§ 16-1.601 Applicability.

OPM shall enforce the provisions of FPR 1-1.6 with respect to health insurance carriers and shall maintain a consolidated list of concerns to whom contracts will not be awarded. Hearing provisions shall be those set forth at 5 CFR 890.205.

Subpart 16-1.9-Reporting Possible Antitrust Violations

§ 16-1.901 General policy.

Where proposals received in FEHBP procurements evidence violations of the antitrust laws, the procedures in FPR 1-1.9 may be used in referring such proposals to the Attorney General. Subpart 16-1.10—Publicizing Procurement Actions

§ 16-1.1001 General policy.

FPR 1-1.10 is applicable to the administration of FEHBP contracts. In addition, OPM will implement the following sections in the manner prescribed below.

§ 16-1.1003 Synopses of proposed procurements.

At least 60 days prior to the beginning of the annual negotiation process for new FEHBP contracts, OPM shall publish a notice of its proposed procurement action in the Department of Commerce Synopsis. Interested carriers shall be directed to OPM for information concerning submission of applications for participation.

§ 16-1.1004 Synopses of contract awards.

At the close of the negotiation period, OPM shall publish in the Department of Commerce Synopsis a list of all carriers approved for participation in the FEHBP during the next contract year.

Subpart 16-1.12-Responsible

Prospective Contractors

§ 16-1.1200 Scope of subpart.

This subpart prescribes the policies concerning the responsibility of prospective carriers.

§ 16-1.1201 Applicability.

FPR subpart 1-1.12 is applicable to the administration of FEHBP contracts. In addition, carriers must meet the requirements of 5 U.S.C. chapter 89, and 5 CFR Part 890, and this Chapter 16.