Multiple Problems With the 1974 Amendments to the Federal Employees' Compensation Act

HRD-79-80: Published: Jun 11, 1979. Publicly Released: Jun 11, 1979.

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The number of lost-time injury claims filed by federal workers increased sharply following legislative changes in 1974 which allowed employees' pay to continue uninterrupted for 45 days after a traumatic injury and gave them free choice of a physician.

Removal of a previously required waiting period has encouraged employees to file claims for minor and frivolous injuries and for injuries of short duration. A random selection of 410 continuation-of-pay (COP) claims showed that, based on the duration of the injuries and on other available factors, as many as 46 percent of all claims might have been eliminated by a 3-day waiting period. Lacking agency controls, the free-choice-of-physician provision has contributed to COP abuse. The Department of Labor has not provided employing agencies with sufficient authority to carry out their responsibility for managing injury claims; and the degree of management varies widely among agencies. A large backlog of claims in Labor's district offices has hindered the COP program; while short-cuts taken to try to control the volume of claims has allowed erroneous and unsupported claims to get through the system.

Matters for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: When we determine what steps the Congress has taken, we will provide updated information.

    Matter: Congress should provide employing agencies with the authority, if there is a question about the initial diagnosis of an employee's injury or the length of disability resulting from that injury, to require an employee to submit to a second medical examination by a federal medical officer or a physician designated by the Secretary of Labor.

  2. Status: Closed - Not Implemented

    Comments: Any legislation to amend the Federal Employees' Compensation Act is not likely to pass in the near future.

    Matter: Congress should require that the 3-day waiting period for traumatic injuries be applied before the payment of COP, rather than 45 days later, in order to reduce the number of minor and frivolous claims which are diverting Labor's efforts from more serious claims, to reduce the cost to taxpayers, and to give federal employees an incentive to return to work.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should have the Assistant Secretary for Employment Standards instruct the Office of Workers' Compensation Programs to assist employing agencies with establishing uniform policies for dealing with COP. These policies should include provisions for investigating questionable claims, monitoring the progress of an employee recovering from an injury, contacting the employee's physician, developing a light-duty program, and recovering the COP paid for denied claims.

    Agency Affected: Department of Labor

  2. Status: Closed - Not Implemented

    Comments: Labor believed that a complicated scheme would be necessary to ensure that uniform standards would be applied in these cases.

    Recommendation: The Secretary of Labor should require the Assistant Secretary for Employment Standards to instruct the Office of Workers' Compensation Programs to give employing agencies the authority to controvert and withhold COP in controversial claims or in claims for which the agencies have found a basis for denial. Labor should give priority adjudication to these controverted claims.

    Agency Affected: Department of Labor

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should have the Assistant Secretary for Employment Standards instruct the Office of Workers' Compensation Programs to require district office claims examiners to obtain sufficient evidence for all COP claims before rendering final decisions.

    Agency Affected: Department of Labor

  4. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should actively encourage employing agencies to develop programs for working with employees and their physicians, including contacting the employee's physician at the earliest possible opportunity and working with the physician in determining the best resolution of the employee's claim and length and extent of the disability.

    Agency Affected: Department of Labor

  5. Status: Closed - Not Implemented

    Comments: Labor believed that it would require a complicated administrative scheme to ensure uniform standards to withhold COP until the injured employee provided an agency with sufficient medical evidence to substantiate a claim and that the agencies already have the authority to terminate COP when an employee refuses to return to work.

    Recommendation: The Secretary of Labor should require the Assistant Secretary for Employment Standards to instruct the Office of Workers' Compensation Programs to provide all employing agencies with the authority to withhold COP: (1) until employees have provided agencies with sufficient medical evidence to substantiate their claims; and (2) when the employee refuses to return to work on a suitable light-duty assignment when such an assignment is in accordance with the attending physician's diagnosis.

    Agency Affected: Department of Labor

 

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