Energy Employees Compensation:

Even with Needed Improvements in Case Processing, Program Structure May Result in Inconsistent Benefit Outcomes

GAO-04-515: Published: May 28, 2004. Publicly Released: May 28, 2004.

Additional Materials:

Contact:

Daniel Bertoni
(202) 512-9889
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Subtitle D of the Energy Employees Occupational Illness Compensation Program Act of 2000 allows the Department of Energy (Energy) to help its contractors' employees file state workers' compensation claims for illnesses determined by a panel of physicians to be caused by exposure to toxic substances while employed at an Energy facility. Congress mandated that GAO study the effectiveness of the benefit program under Subtitle D. GAO focused on four key areas: (1) the number, status, and characteristics of claims filed with Energy; (2) the extent to which Energy policies and procedures help employees file timely claims for these state benefits; (3) the extent to which there will be a "willing payer" of workers' compensation benefits, that is, an insurer that--by order from or agreement with Energy--will not contest these claims; and (4) a framework that could be used for evaluating possible options for changing the program.

During the first 2 1/2 years of the program, ending December 31, 2003, Energy had completely processed about 6 percent of the more than 23,000 cases that had been filed. Energy had begun processing nearly 35 percent of the cases, but processing had not yet begun on nearly 60 percent of the cases. Further, insufficient strategic planning and systems limitations complicate the assessment of Energy's achievement of goals related to case processing, as well as goals related to program objectives, such as the quality of the assistance provided to claimants in filing for state workers' compensation. While Energy got off to a slow start in processing cases, it is now processing enough cases that there is a backlog of cases waiting for review by a physician panel. Energy has taken some steps intended to reduce this backlog, such as reducing the number of physicians needed for some panels. Nonetheless, a shortage of qualified physicians continues to constrain the agency's capacity to decide cases more quickly. Consequently, claimants will likely continue to experience lengthy delays in receiving the determinations they need to file workers' compensation claims. In the meantime, Energy has not kept claimants sufficiently informed about the delays in the processing of their claims as well as what claimants can expect as they proceed with state workers' compensation claims. GAO estimates that more than half of the cases associated with Energy facilities in 9 states that account for more than three-quarters of all Subtitle D cases filed are likely to have a willing payer of benefits. Another quarter of the cases in these 9 states, while not technically having a willing payer, have workers' compensation coverage provided by an insurer that has stated that it will not contest these claims. However, the remaining 20 percent of the cases in these 9 states lack willing payers and are likely to be contested. This has created concerns about program equity in that many of these cases may be less likely to receive compensation. Because of data limitations, these percentages provide an order of magnitude estimate of the extent to which claimants will have willing payers. These estimates could change as better data become available or as circumstances change, such as new contractors taking over at individual facilities. The estimates are not a prediction of actual benefit outcomes for claimants. Various options are available to improve payment outcomes for the cases that receive a positive physician panel determination, but lack willing payers. While not recommending any particular option, GAO provides a framework that includes a range of issues to help the Congress assess options if it chooses to change the current program. One of these issues in particular--the federal cost implications--should be carefully considered in the context of the current and projected federal fiscal environment.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DOL now systematically tracks the reasons for ineligibility by making it a part of the case file in the case management system. Whether the claimant was determined ineligible on the front end, meaning they did not have standing to file a claim, or ineligibility is determined on the back end, meaning a final determination was made, that information would be a part of the record. Labor can break out a case of ineligibility where a claimant did not have standing or where a final determination was made. This would make it relatively easy to identify a case in the event a policy or program change occurred or if, for example, a special exposure cohort was created. In addition, DOL gathers feedback from claimants who have received compensation to determine how the process worked, and to identify what worked well and what could be improved. DOL aggregates these data to improve program implementation and address program issues. DOL does not track state workers compensation outcomes since this process has been decoupled from the program. The same recommendation is also included in GAO-04-516.

    Recommendation: To improve Energy's effectiveness in assisting Subtitle D claimants in obtaining compensation for occupational illnesses, the Secretary of Energy should, in order to facilitate program management and oversight, develop cost-effective methods for improving the quality of the data in its case management system and increasing its capabilities to aggregate these data to address program issues. In addition, Energy should develop and implement plans to track the outcomes of cases that progress through the state workers' compensation systems and use this information to evaluate the quality of the assistance it provides to claimants in the Subtitle D program. Such data could also be used by policy makers to assess the extent to which this program is achieving its goals and purposes.

    Agency Affected: Department of Energy

  2. Status: Closed - Implemented

    Comments: DOL took several steps to provide claimants with complete information and ensure good communication. DOL's web site includes information on the compensation program, such as the claims process procedures and the process that claimants will encounter when they file claims for state workers' compensation. The site also identifies the appropriate district office that claimants should contact to determine the status of their individual claim. In addition, the agency regularly holds Town Hall meetings, which include briefings on the compensation program to explain the claims process. They also go into communities to take claims, check the status of claims, and sometimes provide one-on-one counseling. Information on time frames is generally not available on the web site: DOL cannot provide specific information on timeframes because all cases are different and it would depend on whether NIOSH was involved. However, claimants receive more specific information on how long the process will take when a preliminary decision has been issued. The same recommendation is also included in GAO-04-516.

    Recommendation: To improve Energy's effectiveness in assisting Subtitle D claimants in obtaining compensation for occupational illnesses, the Secretary of Energy should, in order to provide claimants with more complete information, expand and expedite its plans to enhance communications with claimants. These plans should focus on providing more complete information describing the assistance Energy will provide to claimants, the timeframes for claims processing, the status of claims, and the process that claimants will encounter when they file claims for state workers' compensation benefits.

    Agency Affected: Department of Energy

  3. Status: Closed - Implemented

    Comments: The Department of Labor, which now administers the program, stated that there is no longer a backlog of cases. As of August 13, 2008, over 90% of the approximately 26,000 cases DOL inherited from Energy have had a final decision by DOL. About 3,100 cases do not have a final decision. Of those 3,100 cases, about 2,500 cases have been administratively closed so no decision will ever be made; the remainder are in process. DOL has made a concerted effort to put those cases at the top of the list. In addition, DOL employs district medical consultants rather than physician panels, who specialize in these toxic diseases. DOL sends medical evidence to the consultants and provides information through its site exposure matrix (SEM), which contains comprehensive information about the type and degree of toxic chemicals present by facility, and scientific links between toxic substances and recognized occupational illnesses. The agency instructs the claims examiners to use the SEM and other evidence examination techniques, as appropriate, and, if necessary, refer the case to DOL's industrial hygienist or district medical consultant. These procedures, as well as the available of more complete site reference data, help account for the lack of a backlog. The same recommendation is also included in GAO-04-516.

    Recommendation: To improve Energy's effectiveness in assisting Subtitle D claimants in obtaining compensation for occupational illnesses, the Secretary of Energy should, in order to reduce the backlog of cases waiting for review by a physician panel, take additional steps to expedite the processing of claims though its physician panels and focus its efforts on initiatives designed to allow the panels to function more efficiently. For example, Energy should pursue the completion of site reference data to provide physicians with more complete information about the type and degree of toxic exposures that may have occurred at each Energy facility.

    Agency Affected: Department of Energy

  4. Status: Closed - Implemented

    Comments: In 2004, the House and Senate introduced legislation that would federalize the payment of energy employees' compensation benefits and provide a schedule of uniform benefit payments for eligible individuals. The bill was enacted in October 2004 as the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 (Public Law 108-375). The same recommendation is also included in GAO-04-516.

    Recommendation: To improve Energy's effectiveness in assisting Subtitle D claimants in obtaining compensation for occupational illnesses, the Secretary of Energy should, in order to reduce disparities in potential outcomes between claimants with and without willing payers, consider developing a legislative proposal for modifying the EEOICPA statute to address the willing payer issue. When assessing different options, several issues such as those discussed in this report should be considered, including the purpose and type of benefit, eligibility criteria and equity of benefit outcomes, and effects on federal costs.

    Agency Affected: Department of Energy

 

Explore the full database of GAO's Open Recommendations »

Sep 2, 2014

Jul 15, 2014

Jun 6, 2014

May 8, 2014

Apr 9, 2014

Mar 4, 2014

Jan 29, 2014

Jul 18, 2013

Jul 8, 2013

Apr 16, 2013

Looking for more? Browse all our products here