Federal Employees' Compensation Act:

No Evidence That Labor's Physician Selection Processes Biased Claims Decisions

GGD-94-67: Published: Feb 11, 1994. Publicly Released: Feb 17, 1994.

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Pursuant to a congressional request, GAO reviewed the Department of Labor's Office of Workers' Compensation Programs' (OWCP) administration of the Federal Employees' Compensation Act, focusing on: (1) whether OWCP obtains and uses medical evidence prepared by physicians conducting second-opinion exams and impartial medical examinations (IME) to minimize the possibility of bias against claimants; (2) OWCP procedures for selecting physicians to conduct IME and second-opinion exams; (3) the timeliness and amounts of OWCP payments to OWCP-selected physicians and claimants' physicians; and (4) OWCP efforts to increase the number of physicians willing to conduct second-opinion exams and IME.

GAO found that: (1) there is no evidence that OWCP selects physicians who are predisposed against claimants; (2) OWCP has terminated claimants' benefits after second-opinion exams because of factors unrelated to conflicts in medical evidence; (3) the OWCP Physician Directory System (PDS) reasonably ensures that IME physicians are selected in an unbiased manner; (4) OWCP district offices have not established procedures to ensure impartial physician selection when PDS is not used due to the lack of physicians in the appropriate specialty or geographic area; (5) nationwide payment data show that OWCP does not rely on a group of selectively chosen physicians for second-opinion exams and IME; (6) OWCP paid most of the physicians or medical groups that conducted IME and second-opinion exams less than $10,000 in fiscal years 1991 and 1992; (7) OWCP takes longer to reimburse claimants' physicians than its selected physicians to ensure the correctness of payment, but its payments to all physicians are within established time limits; and (8) most OWCP district offices have difficulty in recruiting physicians in selected medical specialities to conduct second-opinion exams and IME.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To further ensure unbiased selection of IME physicians and to reduce the potential for perception of bias, the Secretary of Labor should direct OWCP to provide guidance on how IME physicians are to be selected when they are unable to use PDS.

    Agency Affected: Department of Labor

    Status: Closed - Implemented

    Comments: Labor revised its medical procedures manual (FECA Transmittal No. 94-12) to more clearly define methods for selecting physicians for independent medical examinations when the physician directory system cannot be used.

    Recommendation: To further ensure unbiased selection of IME physicians and to reduce the potential for perception of bias, the Secretary of Labor should direct OWCP to provide guidance on when to obtain supervisory approval before using selection methods not specified by the guidance.

    Agency Affected: Department of Labor

    Status: Closed - Not Implemented

    Comments: Labor published revised guidelines to more clearly define methods for selecting physicians who conduct independent medical examinations when the physicians directory system cannot be used and to require documentation when the system is not used. As such, the need for supervisory approval would not seem to be essential to further ensuring the unbiased selection of IME physicians.

    Recommendation: The Secretary of Labor should direct OWCP to prepare documentation in all cases in which PDS is not used to schedule IME.

    Agency Affected: Department of Labor

    Status: Closed - Implemented

    Comments: Labor revised procedures (FECA Transmittal No. 94-12) state that a manual log showing the name and case file number of the claimant, the name, location, and specialty of the physician selected, and a brief note of the reason for departing from the usual selection method should be prepared.

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