Miller v. Office of Personnel Management

• Decision Date: 08 June 2006
• Docket Number: No. 05-3358.,05-3358.
• Parties: Anna MILLER, Petitioner, v. OFFICE OF PERSONNEL MANAGEMENT, Respondent.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1374

449 F.3d 1374

Anna MILLER, Petitioner, v. OFFICE OF PERSONNEL MANAGEMENT, Respondent.

No. 05-3358.

United States Court of Appeals, Federal Circuit.

June 8, 2006.

Catherine E. Stetson, Hogan & Hartson L.L.P., of Washington, DC for petitioner.

Joan Stentiford, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, for respondent. On the brief were Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director; Donald E. Kinner, Assistant Director; Christian J. Moran, Trial Attorney. Of counsel on the brief was Paul N. St. Hillaire, Attorney, Office of the General Counsel, Office of Personnel Management, of Washington, DC. Of counsel was John H. Williamson, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice.

Martha B. Schneider, General Counsel; and Rosa M. Koppel, Deputy General Counsel, Office of the General Counsel, United States Merit Systems Protection Board, of Washington, DC for amicus curiae.

Before SCHALL, BRYSON, and DYK, Circuit Judges.

Opinion for the court filed by Circuit Judge BRYSON.

Dissenting opinion filed by Circuit Judge DYK.

BRYSON, Circuit Judge.

Anna Miller, a retired federal employee, petitions this court for review of a decision of the Merit Systems Protection Board, Docket No. CH-0845-04-0285-I-1. In the matter on appeal, the Office of Personnel Management ("OPM") ruled that Ms. Miller owed more than $8,000 in back premiums for coverage under the Federal Employees' Group Life Insurance program ("FEGLI"). OPM sought to collect that sum by reducing the amount of the retirement annuity payments that Ms. Miller received from the federal government under the Federal Employees' Retirement System ("FERS"). She challenged the reduction by appealing to the Board and requesting that the Board adjudicate her claim that she should not have been required to pay the back premiums. The Board held that it lacked jurisdiction to consider the merits of her appeal. We affirm.

I

Ms. Miller worked as a registered nurse for the Department of Veterans Affairs in Danville, Illinois, until January 5, 1991. She was removed from her position because the agency determined that she was unable to perform her duties for medical reasons. Despite the agency's finding, OPM denied her application for disability retirement. She appealed that denial, but her appeal was unsuccessful.

In November 2001, Ms. Miller applied for a "deferred or postponed" annuity under FERS. OPM reviewed her application and determined that she had been eligible for immediate retirement in January 1991 when she was terminated, because at that time she was 63 years old and had completed 16 years of service. See 5 U.S.C. § 8412(c). Based on its finding as to her eligibility date, OPM determined that Ms. Miller was entitled to a retirement annuity retroactive to January 6, 1991, the day after her employment was terminated. OPM calculated the amount of annuity benefits that had accrued between January 6, 1991, and March 30, 2002, to be $98,823.67. On April 2, 2002, OPM sent Ms. Miller an annuity adjustment payment of $78,774.71, which represented the accrued annuity benefits less certain deductions.

After determining that Ms. Miller was entitled to a retroactive annuity payment, OPM sent her a letter in which it asked her to make an election for basic life insurance coverage, choosing one of three options: 75% reduction in coverage, 50% reduction in coverage, and no reduction in coverage. The letter advised her that there would be no retroactive premium charge if she selected the 75% reduction option, but that the 50% reduction and no reduction options would give rise to retroactive premium charges of $2527.33 and $8372.10, respectively. OPM stated that it was required to "start the collection of premiums on your annuity commencing date," which was in 1991 after the retroactive annuity determination.

Ms. Miller selected the "no reduction" option, but she returned the form to OPM with a letter in which she contended that she should not be charged life insurance premiums for the period 1991 through 2002, since she had not had life insurance coverage during that period. An exchange of letters between OPM and Ms. Miller followed. OPM ultimately decided that Ms. Miller was required to pay the premiums for the period 1991 to 2002 and that the retroactive premium obligation would be treated as an overpayment of her retroactive annuity award. OPM advised Ms. Miller that it would collect the overpayment through deductions from future annuity payments. Ms. Miller also requested that OPM waive collection of the overpayment, but OPM refused to do so. Ms. Miller requested reconsideration, but OPM affirmed its initial decision.

Ms. Miller appealed OPM's decision to the Merit Systems Protection Board. She challenged OPM's determination that when it retroactively awarded her a retirement annuity and she elected full life insurance coverage, it was required by 5 U.S.C. § 8707(b)(1) to charge her for premiums retroactive to 1991. In particular, she argued that because she did not enjoy federal life insurance protection between 1991 and 2002, she should not have to make a retroactive payment of the premiums for insurance coverage during that period. She also appealed from OPM's refusal to waive recovery of the overpayment.

The administrative judge who was assigned to the case disagreed with Ms. Miller and held that OPM had reasonably construed 5 U.S.C. § 8707(b)(1) to require it to charge her for insurance premiums beginning as of the date from which her retroactive annuity payments began to accrue. The administrative judge rejected Ms. Miller's argument that OPM's interpretation of the statute was at odds with its regulations governing the payment of life insurance premiums, which require that premiums be withheld from the date that an "annuity begins." 5 C.F.R. § 870.404(a)-(b). The administrative judge concluded that although Ms. Miller's annuity payments began in 2002, her actual entitlement to the annuity was retroactive to the date she was separated from employment in 1991 and that "her annuity is deemed to have begun in January 1991, notwithstanding the fact that the annuity payments were first tendered to her over ten years later." As to Ms. Miller's request for waiver of the back premium payments, the administrative judge held that Ms. Miller had not shown that she was entitled, under 5 C.F.R. § 845.301, to a waiver of OPM's right to recover the overpayment.

With respect to Ms. Miller's challenge to the amount of the overpayment, the administrative judge held that the Board did not have jurisdiction to review OPM's determination as to that issue. The administrative judge noted that by statute, 5 U.S.C. § 8461(e), individuals may appeal to the Board from actions affecting their right to retirement benefits under FERS. However, the administrative judge ruled that because FERS is codified in chapter 84 of title 5 of the United States Code, while the FEGLI program is codified in a different chapter—chapter 87—OPM's rulings regarding FEGLI benefits and coverage are not governed by the provisions of the FERS statute.

On its own motion, the full Board reopened the case and held that it had no jurisdiction over Ms. Miller's challenge to the overpayment. Because it concluded that the overpayment in this case "resulted from a change in the appellant's life insurance coverage and not from anything related to the computation of her retirement annuity," the Board held that it "lacks jurisdiction over issues regarding the existence and amount of the overpayment." With respect to the portion of the appeal in which Ms. Miller sought a waiver of the repayment obligation, however, the Board held that it did have jurisdiction. On that issue, the Board concluded that because Ms. Miller had received her overpayment knowing that it was subject to OPM's claim for an additional premium payment, waiver of the repayment obligation was not required. Accordingly, the Board upheld OPM's decision in part and dismissed the appeal in part for lack of jurisdiction. Ms. Miller seeks review by this court.

II

The jurisdiction of the Merit Systems Protection Board is confined to those matters assigned to it by statute, rule, or regulation. See Meeker v. Merit Sys. Prot. Bd., 319 F.3d 1368, 1374 (Fed. Cir.2003); Schmidt v. Dep't of the Interior, 153 F.3d 1348, 1356 (Fed.Cir.1998); 5 U.S.C. § 7701(a). The Board has jurisdiction over appeals arising from OPM's administration of the Federal Employees' Retirement System Act ("FERSA"), 5 U.S.C. §§ 8401-79, but it does not have jurisdiction over appeals arising from OPM's administration of the Federal Employees' Group Life Insurance Act ("FEGLIA"), 5 U.S.C. §§ 8701-16. The jurisdictional provision that governs review of disputes concerning annuity payments made under FERSA, 5 U.S.C § 8461(e)(1), provides that, subject to an exception not applicable here, "an administrative action or order affecting the rights or interests of an individual or of the United States under the provisions of [FERSA] administered by [OPM] may be appealed to the Merit Systems Protection Board under procedures prescribed by the Board." The jurisdictional provision that governs review of disputes concerning FEGLIA, 5 U.S.C. § 8715, provides that "[t]he 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 founded on [FEGLIA]." The question in this case is whether Ms. Miller's claim may be characterized as a challenge to an order affecting her rights under FERSA, as she contends, or whether it should be characterized as a claim founded on FEGLIA, as the Board held and as the Board and the United States argue in this appeal. We conclude that the dispute is properly characterized as one founded on FEGLIA, and...