Claims for Compensation under the Federal Employees' Compensation Act; Compensation for Disability and Death of Noncitizen Federal Employees Outside the United States

SUMMARY: The Department of Labor proposes to revise the regulations

governing the administration of the Federal Employees' Compensation Act

(FECA), which provides benefits to all civilian Federal employees and

certain other groups of employees and individuals who are injured or

killed while performing their jobs. The Office of Workers' Compensation

Programs (OWCP) administers the FECA.

The existing rules have been entirely rewritten using plain English

and have also been reorganized into a more accessible format. A number

of significant changes are made in the proposed regulations, including

new sections implementing amendments to the law which provide for

suspension of benefits during incarceration and termination of benefits

for conviction of fraud against the program; changes to the

continuation of pay (COP) provisions, including reducing to 30 days the

time within which COP may be used where there is a recurrence of

disability; paying for an attendant as a medical expense instead of as

a supplemental payment to the claimant; inclusion of OWCP nurse

services in the definition of vocational rehabilitation services;

clarifying the review process by distinguishing between modification on

the Director's own motion (in which case no new evidence or argument is

needed to reopen claim) and reconsideration at the request of the

claimant (which will require the claimant to provide new evidence or

argument to reopen the claim); restricting opportunities to postpone

oral hearings; clarification of subpoena authority; streamlining the

standards for review of attorney fees; provision of more detailed

guidance in regard to claims involving the liability of a third party;

and clarification of procedures with respect to claims filed by non-

Federal law enforcement officers. Also included in the proposed

regulations is a major revision of the medical fee schedule to include,

for the first time, pharmacy and inpatient hospital bills.

DATES: Written comments must be submitted on or before February 23,

1998.

ADDRESSES: Send written comments to Thomas M. Markey, Director for

Federal Employees' Compensation, Employment Standards Administration,

U.S. Department of Labor, Room S-3229, 200 Constitution Avenue NW.,

Washington, DC 20210; Telephone (202) 219-7552.

FOR FURTHER INFORMATION CONTACT: Thomas M. Markey, Director for Federal

Employees' Compensation, Telephone (202) 219-7552.

SUPPLEMENTARY INFORMATION: The FECA provides compensation for wage

loss, medical care, and vocational rehabilitation to Federal employees

and certain other individuals who are injured in the performance of

their duties, or who develop illness as a result of factors of their

Federal employment. It also provides monetary benefits to the survivors

of employees who are killed in the performance of duty or die as the

result of factors of their Federal employment.

The program's regulations were last substantially revised in 1987.

Since then, new provisions have been added to the statute, and

experience has shown that certain parts of the regulations need

clarification or revision to improve and streamline the claims process.

In addition, there has been a significant increase in the number and

complexity of OWCP issues requiring adjudication, which has strained

the administrative resources available to fulfill OWCP's statutory

mandate to adjudicate and administer claims. In addition, several

developments have enabled OWCP to devise a fee schedule applicable to

hospital inpatient and pharmacy bills. For all of these reasons, the

rules have been comprehensively rewritten.

The proposed rules look significantly different than the existing

rules. This is both because they have been completely reorganized into

a format reflecting the organization of the claims process itself and

because they are presented in a question-and-answer format instead of

the narrative form used in the existing rules. We believe that the new

organization and style of the regulations presents the information in a

way consistent with the needs of the user, and will help the reader

more easily find information. In addition, unnecessary information has

been eliminated and material which simply repeats the language of the

statute itself has been removed from various portions of the

regulations.

The regulations have been re-numbered and substantially re-worded.

The sections have been grouped by type of claims, where appropriate, so

that the reader who wants to know about filing death claims, for

example, need only turn to one section to get essentially all the basic

information about how such claims are filed.

A description of other significant changes made by these

regulations follows. Cross references from new sections to the existing

ones are made to allow the reader to better follow the changes.

Subpart A, General Provisions

This subpart is substantially the same as current subpart A

(Secs. 10.1 through 10.23), with the addition of material describing

the penalties imposed as a result of the amendments to the FECA that

added 5 U.S.C. 8148.

Introduction

Section 10.2 has been revised to reflect two changes: employees of

the Alaska Railroad are no longer covered under the FECA; and

administration of the FECA for Panama Canal Commission employees was

returned to OWCP in 1989.

Definitions and Forms

Section 10.5 now includes definitions that used to appear in

several later subparts. Definitions of terms defined in the FECA

itself, such as injury, organ and United States Medical Officers and

Hospitals, no longer appear in the regulations, because it is felt to

be unnecessary to repeat these statutory provisions.

Section 10.5(a) revises the definition of Benefits or Compensation

to clarify that those terms include the amounts paid out of the

Employees' Compensation Fund for medical examinations conducted at the

request of OWCP as part of the claims adjudication process, consistent

with OWCP's longstanding practice.

Section 10.5(g) moves the definition for Earnings From Employment

Or Self-Employment from its existing location in Section 10.125(c) and

revises it to clarify that earnings from self-employment include a

reasonable estimate of the cost to have someone else perform the duties

of an individual who accepts no remuneration. This revision is

consistent with several decisions by the Employees' Compensation

Appeals Board (ECAB) in this area. See, e.g., Edward O. Hamilton, 39

ECAB 1131 (1988); William C. Austin, 39 ECAB 357 (1988).

[[Page 67121]]

Section 10.5(h) replaces the lengthy and cumbersome list which

constituted the old definition for Employee with a shorter list that

omits references to coverage afforded pursuant to other specific

statutes, since the material omitted merely referenced other statutory

provisions.

Section 10.5(i) simplifies and updates the definition of Employer

or Agency by broadening it to make clear that it encompasses the

various titles now used by different agencies for persons designated to

perform the employer's tasks in the FECA claims process. This

streamlining is not intended to in any way change existing practice.

The definition of Knowingly in section 10.5(n) is new. It adopts

the definition for this term, consistently used by the ECAB in numerous

forfeiture cases construing section 8106(b)(2). See, e.g., Garry Don

Young, 45 ECAB 621 (1994); Lewis George, 45 ECAB 144 (1993).

Section 10.5(x) replaces the existing discussion of Recurrence Of

Disability found in Sec. 10.121, which merely provides that a

recurrence occurs when the original injury causes the employee to stop

work again. The definition of recurrence being added to the regulations

reflects OWCP's understanding of the term recurrence as explained by

the ECAB in numerous cases which have thoroughly examined both the

medical and non-medical aspects of this issue. The new definition will

also enable OWCP to recognize the changes that have occurred in the

nature of federal employment in this era of continued government

downsizing by specifically addressing some situations that arise as

agencies close work sites. See, e.g., Terry R. Hedman, 38 ECAB 222

(1986); John W. Normand, 39 ECAB 1378 (1988); Don J. Mazurek (Docket

No. 93-2063, January 23, 1995).

The definitions of Occupational Disease or Illness, Physician and

Student have been shortened, with no intent to make a substantive

change, by deleting (or simply referring to) definitional material

which already appears in the FECA.

In Sec. 10.6, current Sec. 10.5(b) is updated to include a new

category of ``dependents'' for purposes of implementing new section

8148 of the FECA. That amendment requires a suspension of benefits when

a claimant is incarcerated for a felony, but allows instead payments of

a portion of those benefits to eligible dependents.

Rights and Penalties

Sections which merely repeat provisions of the statute (such as the

reference to the FECA as the exclusive remedy for employees and their

families) have been removed. Proposed Sec. 10.16 provides information

about various provisions of criminal law relating to the FECA claims

process. In addition to the description of the penalties, a statement

has been added explaining that enforcement of the criminal laws

applicable to FECA activities is solely within the jurisdiction of the

Department of Justice. This is intended to eliminate confusion on the

part of some individuals who ask that OWCP enforce these criminal law

provisions.

Section 10.17 implements a recent addition to the FECA, section

8148(a). Pursuant to section 8148(a), any beneficiary convicted of

defrauding the federal government in connection with a FECA claim

forfeits his or her right to further compensation ``as of the date of

such conviction.'' To implement this provision in a uniform manner

consistent with the intent of the statute, the term ``conviction'' is

interpreted in this section as occurring either on the date that a

guilty plea is made in open court or the date that a verdict of guilty

is returned after trial.

This interpretation, which is consistent with opinions issued by

the Comptroller General and instructions issued by that office, ensures

consistency among various government agencies and permits uniform

application of these procedures despite variations among jurisdictions

with respect to how the term ``conviction'' has been defined for other

purposes. In addition, choice of the date a guilty plea is made in open

court or a verdict of guilty is returned after trial facilitates

implementation of the statutory provisions because the date is easy to

ascertain following the submission of pertinent factual evidence, such

as a copy of a plea agreement or a judgment order that has been filed

in a criminal case.

Section 10.18 implements another recent addition to the FECA,

section 8148(b). Pursuant to section 8148(b), which is similar to

provisions of several state workers' compensation statutes and a

provision in the Social Security Act, any beneficiary incarcerated for

either a state or federal felony conviction forfeits his or her right

to compensation during the period of such incarceration. However, this

section also provides the OWCP with the discretionary authority to

allocate ``a percentage of the benefits that would have been payable''

to an incarcerated beneficiary among his or her dependents using the

percentages stated in section 8133(a)(1) through (5).

In exercise of this discretion, OWCP has selected the gross current

entitlement of an incarcerated beneficiary as a ``percentage'' of such

beneficiary's ``monthly pay'' under section 8101(4), and the proposed

regulation provides that the resulting amount will be divided, using

the percentages of section 8133(a)(1) through (5), among his or her

dependents during the period of any such incarceration.

Subpart B, Filing Notices and Claims; Submitting Evidence

This subpart contains most of the information in current

Secs. 10.100 through 10.122, 10.130, and 10.140. The material in

current Sec. 10.102(e), which addresses the employer's authority to

provide copies of forms and other records pertaining to a claim, is now

addressed generally in subpart A, Sec. 10.12. Current Sec. 10.104,

regarding physicians' reports, has been moved to subpart D (Medical and

Related Benefits). Current Sec. 10.109(a) (concerning the payment of

the balance of schedule awards) has been moved to subpart E

(Compensation and Related Benefits).

The discussion of development of claims by OWCP found in current

Sec. 10.110(b) has been omitted from the proposed regulations. This

discussion has proven to be misleading, and was mistakenly assumed to

be a commitment by OWCP to undertake development, despite the fact that

it only describes what OWCP may, on an ad hoc basis, do even though the

burden of proof to establish the elements of the claim is on the

claimant at all times. The statements in current Sec. 10.120 and

Sec. 10.121(d) requiring the employer to report termination of

disability on Form CA-3 have been removed, as this procedure is no

longer required. Current Sec. 10.150, which describes OWCP's function

within the sphere of workers' compensation law generally, has been

entirely removed as unnecessary.

Notices and Claims for Injury, Disease, and Death--Employee or

Survivor's Actions

In Sec. 10.100 and 10.102, which discuss notices of injury and

occupational disease, the statements that the employer (or another

person) may file a notice of injury on the employee's behalf are new,

although the practice it describes is a longstanding one. This

provision is being added to the regulations to encourage prompt filing

of claims. OWCP cannot provide case management services, which assist

in a rapid return to work in the crucial early days of disability,

without prompt notice. An informational statement that a claimant may

withdraw a claim before

[[Page 67122]]

it has been adjudicated has also been added to these sections as well

as to Sec. 10.106.

Section 10.101 highlights the need for the employee to file a wage

loss claim (form CA-7 or CA-8) in order to receive wage-loss benefits

(compensation); this is in addition to the initial notice of injury

(form CA-1 or CA-2) which must be filed for every injury, whether or

not the injury results in lost wages. The need to file a separate claim

for wage loss has in the past sometimes been a point of confusion among

claimants, who do not realize that even though they filed the form

notifying OWCP of an injury, OWCP has no way of knowing that the person

has stopped work and lost wages unless the CA-7 or CA-8 claims for wage

loss are also filed. In addition, the 10-day time frame within which

the employee must file the wage-loss claim has been changed to 14 days

to conform to the two-week pay cycle observed by most federal agencies

and by OWCP. The longstanding practice that an employee may file a

claim for permanent impairment (that is, for a schedule award) by

letter if Form CA-7 has already been filed is specified in Sec. 10.104.

Section 10.105 clarifies the circumstances under which a notice of

recurrence (Form CA-2a) is required, rather than a new notice of injury

(Form CA-1 or CA-2). The statement in (a) concerning the need to file a

new notice of injury or episode of occupational disease is being added

as a clarification that reflects current OWCP practice.

The statement in Sec. 10.106 that the employer may file the claim

on the survivor's behalf is new. It is added to encourage prompt filing

of claims. The regulations also explain that the claim may be withdrawn

before adjudication in order to conserve resources.

Notices and Claims for Injury, Disease, and Death--Employer's Actions

Proposed Sec. 10.110, which discusses the employer's

responsibilities when a notice of traumatic injury or occupational

disease has been received, shortens the time frame for submission of

notices of injury and occupational disease from 10 to five work days,

and the regulations now make clear that the employer should not wait

for any supporting evidence before sending the form to OWCP. These

changes reflect OWCP's increasing emphasis on early receipt of notices

of injury and claims for compensation, which enables rapid initiation

of adjudication and case management procedures, as well as payment of

benefits, and an earlier return to work.

Proposed Sec. 10.111 discusses the employer's responsibilities when

a claim for compensation due to disability or permanent impairment has

been received. It also changes the time frames for submittal of a claim

for initial disability when the employee is receiving continuation of

pay. Similarly, a statement emphasizing that the employer should

provide the employee with a Form CA-8 to claim continuing disability

has been added to Sec. 10.112. Both changes represent long-standing

practice on the part of OWCP and most federal employers.

The statement that the employer may not charge for assisting

survivors in filing claims, which is found in current Sec. 10.108, has

been removed as unnecessary from Sec. 10.113, which discusses the

employer's responsibilities when an employee dies from a work-related

injury or disease.

Evidence and Burden of Proof

Section 10.115 describes, in a more comprehensive and specific

manner than the existing regulations, the five basic requirements which

have long been required of a claimant. It supplants the description in

the existing Sec. 10.110(a), which is more procedural and technical,

and which contains information (such as what medical evidence is

required) that is already in development letters and occupational

disease checklists provided directly to the claimant. The need to

submit supporting medical evidence when wage loss benefits are claimed

is emphasized, as this requirement is not always clear to employees.

Section 10.116 includes a reference to OWCP's use of checklists to

assist the claimant and employer in determining what information needs

to be submitted for certain occupational disease cases. While these

checklists have been in use for many years, and provide specific

guidance on what information is required for different types of claims,

they have not previously been mentioned in the regulations.

Decisions on Entitlement to Benefits

New Sec. 10.125 revises the language in existing Sec. 10.130 to

include, in the list of authorities used to adjudicate claims,

decisions of the Employees' Compensation Appeals Board interpreting the

FECA itself. This statement is added to provide claimants and employers

with a general idea of the precedents used in making determinations.

Sections 10.160-10.166 of the existing regulations authorize OWCP

to appoint a representative and to supervise the management of the

claimant's funds by the representative payee. Section 10.424 of the new

regulations regarding representative payees provides that a

representative payee will be appointed only in situations in which no

court or administrative body authorized to do so has appointed a

guardian or other party to manage the financial affairs of the

claimant, since such an appointment constitutes sufficient

authorization for payment of FECA benefits by OWCP to the party so

appointed. Furthermore, OWCP no longer will attempt to supervise a

representative payee's activities, but will instead rely upon

appointment of a guardian under applicable state law and supervision in

accordance with those procedures as necessary.

Subpart C, Continuation of Pay

This subpart covers the same material as current subpart C

(Secs. 10.200 through 10.209). The general rules found in current

Sec. 10.201 have been rearranged and placed in different sections. The

criteria for eligibility in current Sec. 10.201(a) are now found in

Sec. 10.205. Current Sec. 10.201(b) is now found at Sec. 10.215;

current Sec. 10.201(d) is now found at Sec. 10.200; and current

Secs. 10.201(e) and (f) are now found at Sec. 10.223.

Eligibility for COP

Sections 10.205 (d) and 10.207 address the time frames applicable

for paying continuation of pay (COP) when there is a recurrence of

injury. Under the current rule, COP is payable only when the disability

begins within 90 days of the date of injury (see current Sec. 10.201).

Similarly, when an injured employee returns to work but stops again,

any remaining COP is payable for the additional time lost (see current

Sec. 10.208(b)(3)). The proposed rules shorten the 90-day period to a

30-day period in both situations.

The 90-day period presently set forth in Sec. 10.202(a) and (b) was

initially adopted to ensure that injured workers (who filed claims for

COP within 30 days) would receive the full 45 days of COP, while at the

same time affording employers and OWCP sufficient time to develop and

adjudicate claims. Such a grace period is no longer necessary since the

employing agencies are referring Form CA-7s and CA-8s (claims for

compensation) to OWCP in a timely manner and OWCP is adjudicating about

93 percent of these claims and, where appropriate, authorizing the

payment of claims for disability compensation (CA-7s and CA-8s) within

14 days of receipt.

OWCP has focused on minimizing or eliminating lost work time

entirely,

[[Page 67123]]

which requires early intervention in the case. When the employer pays

COP, OWCP may not necessarily even know about lost work time. The

artificial extension of the COP period under the 90-day rules makes it

difficult to intervene in cases where lost time is continuing at the

point when early intervention is crucial. It is no longer necessary to

forego the opportunity for this early intervention to ensure that

income is not disrupted. Indeed, since COP was first introduced,

payment performance has improved measurably, and the time frames were

reduced in 1987 from six months to the current 90 days. OWCP's early

intervention efforts now support an additional reduction of the period

to 30 days, which is the period chosen by Congress as the time frame

within which the initial claim has to be filed.

Calculation of COP

Proposed Sec. 10.217 reworks material found in current

Sec. 10.201(b), which contains a lengthy discussion of when COP is

payable. Among other things, the discussion addresses situations where

an employee continues to work in a different position because he or she

is unable to work in the job held on the date of injury. The existing

rule has been re-written to remove excess verbiage and to make clear

that COP is chargeable where the employee who continues to work, but in

a different job, would otherwise incur a reduction in pay because of

the injury, but for COP. There is no intention to change the substance

of the current rule. Since the methods of computing pay differ among

agencies, it is difficult to capture all the variables, so we invite

comments particularly from agencies on whose practices these new rules

could inadvertently have an unintended adverse effect.

Controversion and Termination of COP

Section 10.222(b) allows an employer to terminate COP when a

preliminary notice of a disciplinary action issued before the injury

becomes final or otherwise effective during the COP period. Current

Sec. 10.201 states that the final written notice of termination of

employment for cause must have been issued before the date of injury.

The proposed change corrects an overly rigid rule and better reflects

the disciplinary process itself. It simply ensures that the employee

and the employer are put in the same position as that which would have

existed but for the injury; the salary would not have continued because

of the disciplinary action and therefore COP should not be paid.

Subpart D, Medical and Related Benefits

This subpart contains most of the information found in current

subpart E (Secs. 10.401 through 10.413), except that some of the

material about medical reports and payments (Secs. 10.410 through

10.413) has been moved to new subpart I. The definitions contained in

current Sec. 10.400 have been shortened and moved to subpart A. This

subpart also addresses the subjects of current Secs. 10.104(a) and

10.305. Current Sec. 10.401(d), which addresses the status of federal

health units, has been removed as superfluous. Current Sec. 10.406,

which concerns dental benefits, has been removed entirely as dental

care is just one of many specialized forms of treatment authorized

under the FECA, and it presents no special issues which need to be

addressed.

Emergency Medical Care

In Sec. 10.300, the statement that the employer need not issue a

Form CA-16 more than one week after the occurrence of the claimed

injury has been added. This statement reflects long-standing practice,

consistent with a purpose behind the issuance of this form, which is

designed to ensure that necessary immediate medical care is not

hindered through uncertainty by the provider of who is responsible for

payment. Section 10.301 addresses often-asked questions and reflects

long-standing policy, by making clear that the physician designated on

the CA-16 may refer a claimant for additional treatment and OWCP will

pay the appropriate associated costs.

Section 10.303 is new and is intended to provide uniform guidance

to employers who have questions about whether it is proper to use a

Form CA-16 to authorize medical testing at OWCP expense when their

employees experience an exposure to a workplace hazard. It has been a

matter of longstanding practice for OWCP to discourage the use of Form

CA-16 in this kind of situation and to remind employers that they may

be under an obligation independent of the FECA to provide their

employees with medical testing and/or other services. This regulation

reflects this practice, as well as OWCP's policy regarding payment for

preventive treatment.

Medical Treatment and Related Issues

In Sec. 10.310, the references to cost-effectiveness with respect

to appliances and supplies and to generic equivalents of prescribed

medications are new. They reflect the need for OWCP to control costs

wherever possible in the current medical environment. OWCP will not

approve an elaborate appliance or service where a more basic one is

suitable, and full reimbursement for the appliance or service may not

be made without prior approval by OWCP.

OWCP receives many questions from employees and chiropractors

concerning the parameters of chiropractic care, and Sec. 10.311

provides more specific guidance. Two changes to current practice are

made for administrative convenience: the definition of ``subluxation''

which appears in current Sec. 10.400(e) has been moved to new

Sec. 10.5(aa), and a statement that OWCP will not necessarily require

the x-ray or a report of the x-ray before adjudication has been added.

Section 10.312, which concerns the services of clinical

psychologists, is also new. Treatment of FECA claimants by clinical

psychologists has become much more common. Cases where a claimant

exhibits or alleges both physiological and psychological conditions

have presented problems concerning the proper scope of practice and the

needs of OWCP for comprehensive medical reports addressing both

conditions. Section 10.312 specifies that a clinical psychologist may

treat a FECA claimant as a physician within the scope of practice

allowed by applicable state law.

Section 10.313 has been added to address frequently asked questions

concerning preventive measures. It reflects OWCP policy as stated in

its internal procedures. What distinguishes situations where preventive

treatment may be authorized from those where it may not be authorized

is the presence of a verifiable work-related injury. Without such an

injury, preventive treatment cannot be authorized.

Attendants

Section 10.314, which concerns the services of attendants,

represents a significant departure from current practice. At present,

an allowance may be paid directly to a claimant for the services of an

attendant (limited by statute to a maximum of $1,500 per month).

Because the payment is made directly to the claimant, OWCP has no

opportunity to properly account for the expenditures, nor to monitor

the quality of the services provided.

The payment is a tax-free augmentation of compensation, and as the

proposed rule makes clear, the Director has determined that requests

for this augmentation will no longer be considered. Individuals who

have been awarded an attendant allowance before the effective date of

the final rule, however, would continue to receive it as

[[Page 67124]]

long as the service is otherwise necessary. Although the augmentation

payment will no longer be considered, and no new awards made, any

necessary services will still be payable (up to $1500 per month) but by

direct payments to the provider, as is generally the case for all other

services.

There are several reasons for this change. Foremost among these is

that it offers OWCP greater fiscal control and quality review, while

continuing to ensure that any necessary personal care services will

continue to be available to the claimant. First, augmentation itself is

paid very rarely. The attendant services for which the supplemental

income provided for under 5 U.S.C. 8111(a) is intended, is not often

necessary without the concurrent need for medical services. Under these

circumstances, the trained medical personnel necessary to perform the

medical functions also take care of the personal care needs, and both

are, and can continue to be paid for as a medical service.

Second, even when only personal care services are necessary, OWCP

may pay for them directly under 5 U.S.C. 8103. The administrative

resources expended in considering applications for this augmentation of

compensation under section 8111(a) are excessive, and most are denied

because there is no showing that the services are necessary. It is

expected that fewer requests for these services will be received when

the payments are made directly to the provider like almost all other

services. Where the claimant can show that the services are necessary

(by providing sufficient medical documentation), however, they will

still be provided for.

Another reason for this change is that by paying the providers of

such service, OWCP will gain both increased financial accountability

and better quality control than now exists. Currently, the allowance is

paid directly to the claimant resulting in OWCP having no effective

administrative control; we are unable to determine whether the provider

is charging too much for the services, for example, or even in some

cases whether the allowance is actually being spent for the services.

By paying for any necessary services directly, under section 8103,

instead of providing an allowance to the claimant, under section

8111(a), these costs will be subject to the same administrative

controls to which most other bills for services and supplies are

subject. Bills will be submitted to OWCP directly by the provider; they

will be subject through the OWCP fee schedule to a maximum monthly

charge of $1,500; bills for services will be scrutinized to ensure the

charges are correct; it will be OWCP, not the claimant, who will be

responsible for resolving any problems with the payments; and a record

of payments to the provider will be reported to the Internal Revenue

Service on form 1099 at the end of each year.

In addition to financial accountability, the quality of services

can better be monitored. Providing supplemental compensation to the

injured employee under section 8111 has in many instances encouraged

family members to take on the personal care services, even though they

may not be trained or well-suited to this task. Paying the provider

directly will give OWCP an added degree of review to ensure that the

necessary services are being provided by a home health aide, licensed

practical nurse or similarly trained individual better able to provide

the care needed. Where a family member can show he or she has the

appropriate qualifications and training, there will be nothing to

prevent them from providing the service and receiving payment.

Section 10.316, which concerns an employee's request to change his

or her primary treating physician, clarifies that an employee need not

consult OWCP for approval when the physician initially selected refers

the employee to a specialist appropriate to the nature of the injury.

Examples of frequently-approved requests for a change of physician are

also provided to illustrate the decision-making process.

Directed Medical Examinations

Sections 10.320 and 10.321 concern second opinion and referee

examinations. A statement has been added to make clear that the

claimant is not entitled to have anyone attend such examinations

(except for a physician of his or her choice, at a second opinion

examination) unless OWCP finds that exceptional circumstances, such as

the need for having an interpreter for a hearing-impaired claimant,

exist. This statement was added to address situations where

representatives and other parties wished to sit in on examinations,

even though this action can be disruptive. The statement that a case

file may be sent for second opinion or referee review where an actual

examination is not needed, or where the employee is deceased, reflects

long-standing practice and is consistent with ECAB precedent on this

issue.

In Sec. 10.323, which addresses failure to report for or

obstruction of a second opinion or referee examination, a sentence has

been added providing that actions of an employee's representative will

be considered the actions of the employee for the purposes of this

section. This statement was added to address situations where

representatives prevent or disrupt examinations, thereby hindering OWCP

from obtaining information needed to adjudicate and manage claims and

is consistent with ECAB precedent on this issue.

Medical Reports

In Sec. 10.330, the list of contents for medical reports has been

expanded to include the extent of disability and prognosis for

recovery, as these items are especially useful in managing disability

cases. Inclusion of these items reflects OWCP practice, and should help

medical providers and employees provide OWCP the information it

requires to reach a decision in the case.

To reduce confusion about submission of medical reports, the

statement that use of form reports is not required has been added to

Sec. 10.331. Also, this section makes clear that reports must have

signatures, although recognizing that many medical providers use

signature stamps in lieu of actual signatures. OWCP reserves the right

to request an original signature on any medical report. The use of Form

CA-17 to obtain interim medical reports is expressly confined to

employees with disabling traumatic injuries, as this form is not

properly used with occupational disease cases.

Subpart E, Compensation and Related Benefits

This subpart contains most of the information found in current

subpart D (Secs. 10.300 through 10.324), and it addresses the subjects

of current Secs. 10.109, 10.126 through 10.128, and Secs. 10.160

through 10.166. The very detailed guidance currently given with respect

to the appointment and responsibilities of representative payees has

been condensed into one paragraph, new Sec. 10.424, as most of the

current material is procedural rather than regulatory in nature.

No counterpart to current Sec. 10.310, which provided for buy-back

of annual or sick leave, is included in the new regulations. This

process is not authorized or required by the FECA, nor is it controlled

by OWCP. It is controlled by each employing agency, in accordance with

its general rules regarding leave repurchase. The only relationship

between those rules and FECA is the general prohibition against paying

wage-loss compensation benefits for any specific period where leave has

been used. OWCP needs to know, therefore, whether leave has been taken

in order to determine whether

[[Page 67125]]

compensation is payable for the same period. By including a reference

in the regulations to the repurchase of leave, however, OWCP has

inadvertently given the impression that OWCP controls or supervises

leave buy-back for injured workers, and disputes concerning leave buy-

back have often been incorrectly submitted to OWCP for resolution. To

avoid this confusion, the reference to leave buy-back has been removed.

Individuals who wish to repurchase leave should consult with their

employing agency. Compensation will not be paid where leave has been

used. Once restoration of leave has been authorized, however, OWCP will

entertain a claim for benefits for that period of time.

Compensation for Disability and Impairment; Compensation for Death

In Sec. 10.400, which defines total disability, a statement

explicitly recognizing OWCP's view that most employees will eventually

return to work has been added. This statement represents long-standing

policy as reflected in OWCP's case management procedures.

In Sec. 10.404, which concerns payment of compensation for schedule

impairment, a statement that OWCP uses the American Medical

Association's Guides to the Evaluation of Permanent Impairment as its

frame of reference for calculating such awards has been added. OWCP has

used this publication in calculating schedule awards for many years,

and the ECAB has approved its use. Since the publication is

periodically updated, OWCP generally uses the newest edition in effect

at the time of the decision in calculating loss of use.

OWCP has received a number of petitions over the years to add

various internal organs to the list of schedule members. We have

considered each organ suggested and, after much deliberation, decided

against any additions. This decision is consistent with most state

workers' compensation systems, which generally do not provide schedule

awards for internal organs.

In Sec. 10.406 and Sec. 10.411, which concern maximum and minimum

rates of compensation, the word ``basic'' has been prefixed to

``monthly pay'' to indicate that locality adjustments are not included

in determinations of maximum and minimum rates of compensation. Also,

statements have been added to recognize that compensation paid due to

an assault which occurred during an attempted or actual assassination

of a federal official in the performance of duty is exempted from the

maximum rates.

In Sec. 10.413, the provisions of current Sec. 10.109 have been

shortened so as not to repeat those appearing in the FECA itself.

In Sec. 10.417, the second and third paragraphs provide that OWCP

may, at least twice each year, request reports to verify student status

or the inability of a child over 18 years of age to support himself or

herself. This reporting schedule is consistent with most school

enrollment schedules, and helps avoid situations where overpayments

occur, by reminding recipients that individuals over the age of 18 who

are not enrolled in school for any particular semester are not eligible

for survivor benefits.

Adjustments to Compensation

Section 10.421(c) is new and reflects long-standing practice

regarding the concurrent receipt of compensation from OWCP and

severance or separation pay from the employer. With the increasing use

of such benefits as the government downsizes, the frequency with which

this is an issue has increased, and so a provision addressing this

issue was included in the regulation. This provision is consistent with

ECAB precedent on this issue.

Section 10.421(d) is also new and implements the changes made to

the FECA when the Federal Employees' Retirement System (FERS) was

instituted. Federal employees whose retirement benefits are provided by

the FERS receive benefits under the Social Security (SSA) retirement

system as part of their package of retirement benefits. Federal

employees eligible to receive retirement benefits under the Civil

Service Retirement Act (CSRA) must elect between FECA benefits and CSRS

retirement benefits and cannot receive both at the same time. With the

enactment of the FERS, Congress amended the dual benefit provisions of

the FECA (section 8116(d)). A FECA beneficiary may receive FECA

benefits and SSA benefits, except that OWCP is required to reduce FECA

benefits by the amount of any SSA retirement benefits attributable to

the individual's Federal employment.

In Sec. 10.423, which concerns assignment of compensation payments

to creditors, a statement concerning garnishment of benefits for

alimony and child support has been added. The language reflects changes

to various federal laws, making clear that FECA as well as other

Federal benefits may be attached to fulfill alimony and child support

obligations.

Overpayments

The regulations concerning overpayments have been extensively re-

written to highlight and clarify a FECA beneficiary's obligation to be

aware of the period for which benefits are paid, and the manner in

which overpayments are declared, contested, and collected.

The language in Sec. 10.430 has been added to describe how OWCP

notifies a recipient of compensation that a payment has been made,

whether by paper check or electronically. This language was added to

clarify that a recipient is required to be aware of the time period for

which each payment of compensation for wage loss or schedule award is

received and to advise OWCP of any discrepancies noted. Absent

affirmative evidence to the contrary, the beneficiary will be presumed

to have received the notice of payment, whether mailed or transmitted

electronically.

Sections 10.436 and 10.437 discuss the two circumstances under

which an overpayment can be waived pursuant to section 8129(b). Section

10.436 discusses the criteria to be used in determining whether

recovery would ``defeat the purpose'' of the FECA. Section 10.437

discusses the criteria to be used in determining whether recovery would

``be against equity and good conscience.'' Waiver under Sec. 10.436

because recovery would defeat the purposes of FECA is available only to

currently or formerly entitled beneficiaries, which continues the

application of that provision in the existing regulations. In

Sec. 10.437, the manner in which OWCP applies the ``against equity and

good conscience'' test for waiver of an overpayment is revised to

provide that this particular test applies to all individuals who are

``without fault'' and have received compensation because of an error of

fact or law, regardless of whether or not they are present or former

beneficiaries under the Act. This change restores the statutory

distinction between the application of the two tests for waiver

contained in section 8129(b), which was unintentionally removed as a

result of the 1987 revision of the regulations.

In new section 10.441, language has been added to clarify that an

overpayment is a debt that is subject to the Debt Collection Act of

1982 and that if such a debt is not repaid OWCP will attempt to recover

the debt by any available means including offset of salary, annuity

benefits or referral for collection to a collection agency or to the

Department of Justice.

Subpart F, Continuing Entitlement to Benefits

This subpart contains most of the information found in current

Secs. 10.123 through 10.128. It also includes some

[[Page 67126]]

material from current Secs. 10.107 and 10.110.

Claims for Continuing Disability

The regulation concerning continuing receipt of compensation

benefits, new Sec. 10.500, has been written to include a specific

statement that OWCP's goal is to return each disabled employee to work

as soon as medically able. The definition of ``suitable work'' has also

been revised to clarify the criteria by which it is determined that

work is ``suitable''. These changes were made because these concepts

are important to the program and important for both employees and

employers to understand.

The language in Sec. 10.500(a) has been added to inform claimants,

employing agencies and others of OWCP's long-standing practice of

requiring claimants to periodically submit medical evidence in support

of continuing disability. It also includes a description, based on a

consistent line of ECAB precedent, of the type of medical evidence

necessary to support a claim for continuing compensation.

The language in new Sec. 10.500(b) has been added to clarify that

OWCP can require non-invasive testing and functional capacity

evaluations and that failure to undergo such testing may result in

suspension of benefits.

The discussion of weighing medical evidence in Sec. 10.500(c) has

been added to describe OWCP's long-standing method of evaluating

medical evidence. It explains that the conclusions reached in medical

reports are not necessarily accepted at face value. Instead, OWCP

considers the entire report and determines the weight to be accorded it

based on a number of factors, including the extent to which the report

shows a familiarity with the history of the case, whether it contains

objective findings (as opposed, for example, to unsubstantiated

complaints), and the strength of the reasoning supporting any opinion

rendered.

Return to Work--Employer's Responsibilities

The discussion of an employer's responsibilities to return an

employee to work in Sec. 10.505 has been revised to specifically

reference the provisions of section 8151, which grants reinstatement

rights to injured employees and requires employers to take steps to

reemploy them. Language has also been added to inform employees,

employers and others that the Office of Personnel Management (not OWCP)

administers this provision. In the past, employees and former employees

have sought OWCP intervention in disputes concerning reemployment

rights based upon the mistaken belief that OWCP had jurisdiction over

such matters and authority over agency decisions concerning employment

decisions. This provision of the regulations is being added to correct

that misunderstanding of OWCP's role in regard to reemployment.

Section 10.506 includes a new provision allowing employers to

contact employees at reasonable intervals to request periodic medical

reports addressing their ability to return to work. This statement is

consistent with OWCP's case management procedures, which are designed

to include the employing agency in the effort to return the injured

employee to work. The provision is not intended to allow employers to

obtain medical reports for any reason other than evaluation of an

employee's ability to return to work.

The discussion of payment of relocation expenses, in Sec. 10.508,

has been revised to include a provision that OWCP may pay relocation

expenses when the new employer is other than a federal employer, a

situation which the current Sec. 10.123(f) does not address. Requests

for reimbursement in this context do not arise frequently, and the

expenses claimed are usually modest.

Section 10.509 adds a discussion, not contained in the current

regulations, of OWCP's practice with respect to injured employees who

have returned to light-duty work and are separated when their employers

eliminate their light-duty positions in a subsequent reduction-in-force

(RIF) as part of a general agency downsizing at a particular work site.

Consistent with established ECAB precedent, OWCP does not consider such

a termination of employment to be a recurrence of employment-related

disability, since it is not caused by a change in the nature or extent

of the employee's accepted medical condition or a change in the duties

of the light-duty position, which clearly would have continued to be

available in the absence of the RIF.

In such cases, OWCP will determine the employee's wage-earning

capacity based on his or her actual earnings in the former light-duty

position, if such a determination is appropriate and has not already

been made. Unless the employee has been working in a position for which

the employer has prepared a written position description, OWCP will

assume that the employee was engaged in non-competitive employment that

does not represent the employee's wage-earning capacity. This

requirement is consistent with ECAB precedent concerning wage-earning

capacity determinations, which provides that OWCP may not use an

unclassified or ``odd-lot'' position that has been specifically

tailored to fit the work limitations of a particular injured employee

to determine the wage-earning capacity of that employee.

Return to Work--Employee's Responsibilities

Section 10.516 incorporates into the regulations the procedures

followed when OWCP rejects an employee's reasons for refusing a

position that OWCP has found suitable. OWCP adopted these procedures

several years ago in accordance with the decision of the ECAB in Maggie

Moore, 42 ECAB 484 (1991). The proposed regulation provides for a 15-

day period during which an employee may accept the offered job without

penalty after OWCP has determined that his or her proffered reasons for

declining to accept an offer of suitable work are not reasonable.

Section 10.518 adds a discussion of ``vocational rehabilitation

services'' to the regulations. This definition is intended to clarify

that such services include the services of registered nurses working at

the direction of OWCP to assist employees in returning to work. These

nursing services, which generally take place in the weeks immediately

following the injury, are an integral part of OWCP's efforts to return

injured employees to work. Vocational rehabilitation includes a variety

of services, all of which are designed to assist an injured employee's

return to work. Including this definition of vocational rehabilitation

services clarifies that OWCP considers nursing services to be such

services and that the benefits and sanctions set forth in section 8104

and section 8113(b), which apply to other vocational services, will

also apply to nurse services. This discussion also states that OWCP

considers vocational evaluation, testing, training and placement

services, and functional capacity evaluations to be vocational

rehabilitation services.

Section 10.520 incorporates into the regulations an explanation of

how OWCP determines an employee's wage-earning capacity after

completion of a vocational rehabilitation program. This discussion is

intended to inform employees and others of OWCP's long-standing

practice in this area and is consistent with ECAB precedent concerning

determination of wage-earning capacity.

Reports of Earnings From Employment and Self-Employment

The FECA authorizes OWCP to require FECA claimants to report

[[Page 67127]]

earnings from employment or self-employment. The ``earnings'' from

employment or self-employment that must be reported by any employee who

is receiving compensation for either partial or total disability are

defined in Sec. 10.5(g). The language in Sec. 10.525(b) has been added

to clarify the distinction between the effects of having earnings,

which may or may not result in a reduction of FECA compensation, and

the effects of failing to report earnings, which can result in the

forfeiture of all compensation paid or found to be payable during the

reporting period.

The discussion of volunteer activity in Sec. 10.526 has been added

to clarify that employees receiving compensation for partial or total

disability are required to report volunteer activity as part of their

report of earnings from employment and self-employment. Volunteer

service can be a valuable indicator of the kind of gainful employment

that the employee may be able to undertake, and thus OWCP may be able

to use this information to help determine the employee's wage-earning

capacity.

The language in Sec. 10.527 has been added to the regulations to

inform employees and others of the fact that OWCP attempts to verify

reports of earnings in a number of ways, including computer matches

with the Office of Personnel Management and state workers' compensation

agencies.

Reduction and Termination of Compensation

Sections 10.540 and 10.541 are new and reflect OWCP's long-standing

practices with respect to how and under what circumstances it will

provide beneficiaries with written notice that it intends to either

reduce or terminate their compensation in the next 30 days, as well as

the administrative steps it will take after it provides such notice.

These provisions are to inform employees and others when and how OWCP

notifies beneficiaries of its intention to terminate compensation and

to clarify that, in situations when the beneficiary has no reasonable

expectation that compensation will continue, OWCP will not provide this

pre-termination notice.

Subpart G, Disallowances and Appeals

This subpart contains most of the information found in current

Secs. 10.130 through 10.145, except for the material found in current

Sec. 10.142, which is moved to subpart H.

Reconsiderations and Reviews by the Director

Review of a decision on application of the claimant is addressed in

current Sec. 10.138(b), and review of a decision on the Director's own

motion is addressed in current Sec. 10.138(a). Sections 10.605 through

10.610 revise and expand the description of reviewing a decision on

application of the claimant and on the Director's own motion in order

to clarify the difference between these two separate procedures. These

provisions state that the Director's authority is not subject to a

request or application. Further, these provisions adopt OWCP's long-

standing position that the Director does not need new evidence or

argument to review a decision and that the decision by the Director to

review a decision is not a proper subject for review or appeal.

In many cases, claimants appear not to have understood the

distinction between the two distinct review procedures authorized by

section 8128(a). Some individuals, who remain dissatisfied with an OWCP

decision after exhausting all their review and appeal rights, have

asked the Director to review the decision with which they disagree

pursuant to the Secretary's authority under section 8128(a), delegated

to the Director, to review a decision on his or her own motion. The

distinction between the Director's authority to review a decision on

his or her own motion and a claimant's application for review is not

new in practice. Claimants have never been entitled to ``apply'' for

review outside the process described as a ``reconsideration'' in the

review and appeal options accompanying all adverse decisions. When a

request to the Director to review a decision on his or her own motion

is received, it has been OWCP's long-standing practice to treat it as a

reconsideration request rather than an additional avenue for claimants

to seek review.

To alleviate the confusion that has been demonstrated in regard to

this issue, Sec. 10.610 specifically states that OWCP will not consider

a request for review on the Director's own motion. The statutory

provision authorizing a claimant to request review of a decision ``upon

application'' is fulfilled by the application for reconsideration.

Since no other mechanism for a claimant dissatisfied with a decision to

obtain a review ``upon application'' is available, OWCP will continue

to treat requests that the Director review a decision on his or her own

motion as requests for reconsideration.

A number of ECAB cases have addressed the question of whether the

Director is required to have new evidence or argument to review a

decision under section 8128(a). In Eli Jacobs, 32 ECAB 1147 (1981), the

ECAB held that the Director may reopen a claim at any time without

specifying what standard, if any, applied to that decision. In a later

decision, Daniel E. Phillips, 40 ECAB 1111, petition for

reconsideration denied, 41 ECAB 201 (1989), however, over the dissent

of one member of the panel, the ECAB held that to reopen and rescind

acceptance of a claim, the Director must establish that the original

decision was erroneous through the use of ``new or different

evidence.'' The ECAB reached this conclusion without specifying any

statutory or regulatory basis for this limitation. Its only rationale

was its opinion that reopening a decision should not become a

surreptitious route for OWCP to readjudicate a claim. In later cases

that formulation was expanded to include allowing reopening and

rescission of a prior decision through new or different evidence, legal

argument or rationale. See, e.g., Beth A. Quimby, 41 ECAB 683 (1990);

Billie C. Rae, 43 ECAB 192 (1991); Shelby J. Rycroft, 44 ECAB 795

(1993); Laura H. Hoexter (Nicholas P. Hoexter), 44 ECAB 987 (1993).

Section 10.610 adopts the long-standing position of the Director

that the plain language of section 8128(a) authorizes the Director,

without pre-condition, to review a decision ``at any time.'' The

existing regulations contain a provision, carried over in Sec. 10.608,

limiting the right of a claimant to obtain a merit review and a new

decision from OWCP to those situations in which the claimant meets one

of the requirements set out in Sec. 10.138(b). Without this limitation,

the effective administration of the program could be undermined by

taxing the limited resources available to administer the program

through frivolous requests for review. Allowing the claimant to reopen

the claim just to have the same evidence reviewed again would both

waste the claims staff time and slow down the appellate process.

In view of the fact that the statute imposes no limitation upon the

right of the Director to review a decision ``at any time,'' Sec. 10.610

grants the Director an unconditional right to review any decision

without requiring new evidence or argument. Effective administration of

the program requires that the Director be able to review decisions at

any time without having to supply new evidence or argument.

This does not mean, however, that the claimant has no recourse when

the

[[Page 67128]]

Director reviews a decision and issues a new decision with which he or

she disagrees. Any adverse decision is subject to the full range of

review and appeal options which protects the claimant from arbitrary

action. Congress clearly did not contemplate restricting the Director's

ability to reopen a claim when it gave the Director authority to review

a decision ``at any time''.

Consistent with this broad authority, Sec. 10.610 provides that the

determination whether or not to review a decision on his or her own

motion is not subject to reconsideration, review or appeal. Since the

Director has unfettered discretion in deciding whether or not to review

a decision, and any claimant unhappy with a new decision issued after

such a review by the Director is provided the same rights to seek

reconsideration, review or appeal associated with any OWCP decision, no

purpose would be served by allowing further review of the Director's

decision to review a previous decision.

Hearings

In Sec. 10.615 a provision has been added granting hearing

representatives discretion to conduct an oral hearing by telephone or

teleconference. Section 10.616(b) revises the time period in which a

claimant can request a change in the format of a hearing. A request

received by the Branch of Hearings and Review before the date OWCP

issues a notice that the record is closed for written review, or has

set a date for an oral hearing, will be granted. Later requests will be

subject to OWCP's discretion.

Section 10.617(g) makes clear that the hearing representative may

terminate a hearing at any time that he or she deems the actions of the

claimant and his or her representative to be disruptive. This provision

reflects current practice.

The discussion of issuing subpoenas, Sec. 10.619, has been revised

to set forth the criteria for issuing a subpoena. To alleviate

confusion that has been demonstrated concerning the circumstances under

which subpoenas can be issued, Sec. 10.619(a) specifically provides,

consistent with practice based upon ECAB precedent, that subpoenas will

be issued at the request of a claimant only in connection with

hearings. Moreover, it makes clear that this method of gathering

evidence is to be used as a last resort. Because the hearing is an

informal procedure, not bound by rules of evidence or formal rules of

procedure, the need for subpoenas is limited and is sufficiently

accommodated by providing that a subpoena can be issued for documents

when the information is not available by other means and for witnesses

when oral testimony is the best way to ascertain the facts. To avoid

disruptions of the hearing process and encourage early and active

development of the evidence, Sec. 10.619(a)(1) provides that a subpoena

must be requested within 60 days after the date of the original hearing

request.

To clarify the role of a representative of the employer at a

hearing, the discussion of this subject, in Sec. 10.621(b), has been

revised to specifically note that a hearing representative may deny a

request by the claimant that the agency representative testify where

the claimant cannot establish that such testimony would be relevant or

because the representative does not have the appropriate level of

knowledge.

Section 10.622 revises the rules concerning postponement of oral

hearings to address problems that have arisen since the institution of

the current rules concerning postponements in 1987. Oral hearings are

scheduled at locations within a reasonable proximity to claimants'

places of residence. As a result, hearings are scheduled throughout the

country, several times a year in some locations and only once a year in

other locations. For each trip, one hearing representative is assigned

a number of cases as the ``docket''. Before the trip, the hearing

representative must review each file, research the issues, and prepare

the record, all of which requires many hours of work.

Scheduling and workload constraints prevent OWCP from sending the

same hearing representative to the same city each time. Thus, when a

hearing is postponed, it often requires that another hearing

representative repeat the preparation for the hearing undertaken by the

previous representative. Furthermore, in many cases it is too late to

schedule another case for that slot on the docket, thus needlessly

delaying hearings for other claimants.

The current rule, found at Sec. 10.137, which allows a postponement

for ``good cause'' if the request is received at least three days prior

to the date of the hearing, has proven completely ineffective at

controlling the waste of resources caused by postponements. Disputes

over what constitutes ``good cause'' sometimes take longer and require

more resources than rescheduling the hearing itself. The result is

delay, not only for the claimant whose hearing was scheduled and

postponed, but for other claimants adversely affected by the

inefficiency of the current process.

Thus, new procedures are being adopted which provide that, once the

oral hearing is scheduled, it cannot be postponed unless the hearing

can be rescheduled on that same trip. In the event that an oral hearing

cannot be rescheduled on that same trip, the claimant will be provided

a review of the written record instead. The proposed limitation is a

reasonable compromise which will improve the administration of the

program. The program's resources must be preserved to ensure the best

service to all those seeking a hearing. Constant and repeated

postponement of oral hearings constitute a serious drain on those

resources. The review of the written record by a hearing representative

as a substitute for an oral hearing has served as an effective way to

provide the review contemplated by the FECA on a more timely basis than

resources otherwise would permit.

In most cases, the issues relate to written evidence (particularly

medical evidence). A face-to-face hearing does little to clarify

medical issues, since the determination, in most cases, must be made on

the basis of written medical evidence in the file. A review of the

written record has been selected, therefore, as an effective way to

provide the review of the decision by a hearing representative where

the claimant must postpone the hearing.

Another change to the oral hearing procedure is to allow a claimant

to express a preference for scheduling an oral hearing. OWCP will

attempt to comply with any scheduling preferences of which it is

advised at the time of the original request. Once the notice of hearing

is sent, the claimant can request a change in the day and the time of

the hearing within the same docket.

Review by the Employees' Compensation Appeals Board (ECAB)

Claims on appeal often have continuing issues, such as payments of

bills or actions on collateral issues such as recurrences, requiring

actions by OWCP. Sometimes, because the case is under the jurisdiction

of the ECAB, there are questions as to what can and cannot be done by

OWCP when cases are before the ECAB. To clarify this issue, language

has been added to the regulations, in Sec. 10.626, which explains the

circumstances under which OWCP still has jurisdiction over issues in

cases pending before the ECAB.

Subpart H, Specialized Topics

This subpart contains most of the information found in current

subparts G and H (Secs. 10.500 through 10.624), as well as the material

found in Sec. 10.142.

[[Page 67129]]

Representation

Current Sec. 10.143 states, with no elaboration, that a claimant

may authorize any individual as a representative in a claim before

OWCP. Section 10.700 more fully describes who may act as a

representative, what authority a representative has, and specifies that

there can be only one representative in a claim at a time. These

provisions essentially incorporate current practice.

The FECA gives to the Director, as the Secretary's delegate, the

authority to approve fees associated with representation of a claim

under the FECA. In the past, OWCP claims personnel have reviewed all

bills for representatives' services, even if the claimant did not

disagree with the amount billed. To reduce the workload imposed by

extensive review of bills with which claimants do not disagree,

Sec. 10.702 implements a new procedure by which OWCP would

automatically approve all fees unless the represented party objects to

the amount billed. In that case, OWCP will give that party an

opportunity to submit further information. OWCP will then adjudicate

the request according to the criteria set forth in Sec. 10.703(c). This

section adopts the criteria in the existing regulations at

Sec. 10.145(b), after removing items that are essentially duplicative.

Third-Party Liability

Current Sec. 10.501 through Sec. 10.507 essentially restate

provisions of sections 8131 and 8132 of the FECA. Much of that material

has, therefore, been removed as redundant. Sections 10.704 to 10.719

explain, interpret and clarify duties of FECA claimants and their

counsel pursuant to sections 8131 and 8132 of the FECA. Section

10.705(b) incorporates into the regulations a specific reference to the

fact that the Office of the Solicitor (SOL) administers the subrogation

aspects of certain FECA claims for OWCP. (This does not, however,

preclude an employing agency from participating in administering the

subrogation aspect of its employees' cases under a specific agreement

with OWCP.) Section 10.706 explains how a FECA beneficiary is informed

of the obligation to pursue a claim against a third party. Section

10.707 provides a list of all actions that must be taken by a FECA

beneficiary in order to comply with the requirement in section 8131 of

the FECA that a claimant prosecute an action against a third party when

required to do so by OWCP. The purpose of this section is to inform

claimants that failure to comply with any of the requirements in this

section could result in forfeiture of all FECA benefits arising out of

the injury at issue. Section 10.708 further details the penalties that

can be applied to a FECA beneficiary who fails to prosecute a claim or

to assign it to the United States when requested to do so by indicating

that OWCP may order forfeiture of such benefits or alternatively could

suspend such benefits until the request to assign or prosecute is

complied with. In many instances, review of the information available

to OWCP indicates that there is a possibility of third party liability,

which, upon further investigation by private counsel consulted by the

FECA beneficiaries, is either not economical to pursue or simply not

meritorious. Section 10.709 sets forth the procedure to be followed by

a FECA beneficiary to be released from the obligation to prosecute an

action against a third party.

Section 10.710 is being added to the regulations to clarify that

any person who has filed a FECA claim that has been accepted or who has

received FECA benefits in connection with a claim filed by another

person must report any receipt of money or other property as a result

of the liability arising out of that injury to OWCP or SOL within 30

days of receipt. Section 10.711 is being added to the regulations in

order to provide a step by step explanation of the calculation of the

refund to be paid to the United States and any credit against future

benefits calculated in accordance with the formula contained in section

8132 of the FECA. The only change contemplated from existing practice

by this formula is elimination of the opportunity to offset payment of

medical expenses to federal facilities or other parties from any

recovery. This practice has been allowed as an administrative

accommodation, but rarely occurs and is no longer considered necessary.

Any medical expenses paid directly by the FECA beneficiary should be

submitted directly to OWCP for reimbursement as appropriate.

Section 10.712 incorporates into the regulations OWCP's

longstanding practices in regard to what amounts are included in the

gross recovery reported in connection with third party liability for an

injury covered by the FECA. Section 10.713 is being incorporated into

the regulations to require that a FECA beneficiary who receives a

structured settlement (one which provides for payment of funds over a

specified period of time rather than immediately) report as the gross

recovery the present value of the right to receive all of the payments

called for in the settlement. This requirement is in keeping with the

plain language of section 8132 of the FECA, which covers the receipt of

``money or other property'' and the recognition that the right to

receive a stream of payments in the future is clearly a valuable

property right. This definition is intended to overrule the holding of

the ECAB in Benjamin S. Purser, Jr., 42 ECAB 204 (1990).

Section 10.714 sets forth the manner in which OWCP calculates

disbursements which it makes in connection with a FECA claim to be

refunded in accordance with the formula set out in section 8132 and

Sec. 10.711 of these regulations. The only change from existing

practice is to allow for subtraction from the total of refundable

disbursements of the cost of any medical examination that the FECA

beneficiary establishes that the employing agency should have made

available at no charge to the employee under a statute other than the

FECA. This change is being made to ensure that employees who sustain

injuries covered by the FECA are not treated less favorably than those

who receive such treatment but have not sustained injuries covered by

the FECA.

OWCP has decided to impose interest charges on refunds due to the

United States pursuant to section 8132 of the FECA as set forth in

Sec. 10.715. This is a change in current policy and is consistent with

the Debt Collection Act of 1982. In view of the fact that certain FECA

beneficiaries currently receiving compensation payments owe refunds and

have refused to pay, a provision is being added to the regulations at

Sec. 10.716 allowing collection of such refund by withholding from

payments currently payable under FECA. Section 10.717 is being added to

the regulations to clarify OWCP's longstanding interpretation that,

since an injury caused by medical malpractice in treating a FECA-

covered injury is itself an injury covered by FECA, any recovery

received in a negligence suit arising out of such malpractice is a

recovery subject to section 8132 of the FECA. Similarly, Sec. 10.718 is

being added to the regulations to make clear another longstanding OWCP

interpretation: that insurance payments to a beneficiary pursuant to a

policy the beneficiary has purchased do not constitute a recovery

pursuant to section 8132.

Section 10.719 is being added to the regulations to interpret the

phrase ``same injury'' for the purposes of implementing section 8132 of

the FECA. While an argument can be made that the statute intended that

each recovery for a medical condition or wound should be

[[Page 67130]]

treated separately for the purpose of calculating any required refund

or credit against future benefits (an argument which has been accepted

by one district court, in Benjamin S. Purser, Jr. v. United States

Department of Labor, 943 F.Supp. 898 (M.D. Tenn. 1996), the approach

being adopted by these regulations is more consistent with the intent

of section 8132 and the administration of the FECA. Attempting to

separate out each different ``injury'' incurred in, for example, an

automobile accident as a result of which an injured employee may have

multiple medical conditions affecting numerous body parts in order to

allocate a single settlement from the other driver into pieces appears

to be an artificial exercise that serves no purpose set forth by the

statute. Such an interpretation invites artful drafting of settlement

agreements designed to negate the intended effect of the statute to, in

part, shift the costs of FECA onto parties who have caused injuries

covered under the FECA. Since each claim for FECA benefits arising out

of a single incident is administered as one file, regardless of the

number of wounds or medical conditions involved, attempting to

separately account for the recovery attributable to each wound and to

offset any credit against future benefits only to medical payments

attributable to that wound would be nearly impossible, except in the

most arbitrary manner and even then would be time-consuming, cumbersome

and a source of immense delay and confusion.

Federal Grand and Petit Jurors

Current Sec. 10.620 on the definition of jurors has been moved to

the list of definitions at Sec. 10.5(h), while current Sec. 10.621 on

the applicability of the other subparts of the regulations has been

removed as unnecessary.

Peace Corps Volunteers

Current Sec. 10.600 on the definition of Peace Corps volunteers,

Sec. 10.601 on the applicability of the FECA, Sec. 10.602 on when

disability compensation commences, Sec. 10.603(a) through (c) on

special pay rate considerations, and Sec. 10.604 on the period of

service of volunteers essentially restated provisions of the FECA and

other relevant statutes and have therefore been removed as redundant.

Non-Federal Law Enforcement Officers

Current Sec. 10.612(d) on the eligibility of non-federal law

enforcement officers, Sec. 10.617(c) on the adjudication of these

claims, Sec. 10.618 regarding consultation with the Attorney General

and other agencies, and Sec. 10.619 on cooperation with state and local

agencies essentially restated provisions of the FECA and have therefore

been removed as redundant.

Subsections (a) and (c) of Sec. 10.735 combine current Secs. 10.611

and 10.612, which have been rewritten to accommodate the question and

answer format and to delete material that simply restated provisions of

the FECA, without any attempt to make a substantive change. Subsection

(b) is new and restates other parts of the FECA for use as a general

rule. The last sentence of subsection (b) reflects OWCP's longstanding

practice with respect to the issue of coverage under this subpart for

individuals who only perform administrative functions in support of

eligible officers.

The last sentence of Sec. 10.736 is new and reflects a recent ECAB

decision which construed the time limitation provision of 5 U.S.C.

8193(c)(3).

Section 10.738 has been rewritten with minor changes throughout to

address a growing body of ECAB precedent regarding the nature and

extent of coverage for officers who are injured in situations that

involve potential federal crimes (as distinguished from actual crimes

that have resulted in a criminal prosecution).

Section 10.739 is new and describes the type of objective evidence

necessary to establish the existence of a potential federal crime for

purposes of coverage consistent with several ECAB decisions on this

point. An enumeration of the various methods for making this type of

showing is necessary to assist OWCP in its adjudication of a growing

number of these sorts of claims.

Section 10.741 is new and substantially rewrites the existing

regulation at Sec. 10.616 to reflect longstanding administrative

practices regarding the interpretation of what constitutes

``comparable'' benefits consistent with ECAB precedent. Section

10.741(c) is added to the regulations to explain how these benefits are

calculated in certain circumstances where the officer contributes to

the fund which is the source of the benefit. These provisions are

needed to provide OWCP with guidance in adjudicating these matters,

which have generated a number of inquiries from officers and their

representatives. This interpretation is consistent with OWCP's current

practice in calculating how much of the eligible officer's FECA benefit

must be offset as a result of the receipt of comparable benefits.

Subpart I, Information for Medical Providers

This subpart is designed to gather in one section all of the

information needed by medical providers. It combines some of current

Secs. 10.410 through 10.413 with Secs. 10.450 through 10.457.

It also contains proposed revisions in the rules establishing

procedures for submission and reimbursement of inpatient hospital

services and pharmaceutical bills under the FECA. These revisions would

supplement rules in effect since 1986, which provide for a fee schedule

for reimbursement of medical procedures and services. This fee schedule

currently applies to all physician services as defined under the FECA,

and to outpatient professional services.

Medical Bills

In Sec. 10.801, references to National Drug Codes and Revenue

Center Codes have been added to the list of codes which the medical

provider must specify. References to UB-82 have been changed to UB-92,

as the latter has become the standard billing form for hospitals. A

statement that pharmacy bills are to be submitted on the Universal

Claim Form has also been added.

Medical Fee Schedule

Sections 10.809 and 10.810 are new. OWCP believes that expanding

its ability to control and monitor medical costs is a critical element

in ongoing efforts to enhance the management of injuries under FECA.

Under these rules, both pharmacy bills and inpatient hospital bills

will be subject to cost containment methods.

Under the FECA, OWCP authorizes payment for medical services and

establishes limits for fees for such services (March 10, 1986, 51 FR

8276-82, as amended). Since 1994, the schedule for payment of

professional services has been based on the relative value units

(RVU's) devised by the Department of Health and Human Services, Health

Care Financing Administration (HCFA). When appropriate for the

schedule, OWCP devises its own RVU's for procedures not covered under

the HCFA schedule, for procedures without an assigned RVU under the

HCFA schedule, for services HCFA covers under other schedules, and for

services unique to OWCP, such as second opinion and impartial medical

evaluations. In addition, OWCP devises its own conversion factors to

meet program needs.

The Department recognizes the worth of using a schedule to

reimburse

[[Page 67131]]

covered medical services in that it provides an equitable method to

implement cost control measures, and it enhances the ability to manage

injury claims, especially the appropriateness of the medical services

provided and their relatedness to the compensable injury. These same

principles underlie the extension of cost controls to pharmacy and

hospital bills.

Pharmacy bills: At present, pharmacy payments, which constitute

nearly 6% of the total medical outlays of the program, are not

controlled by the fee schedule. These rules would reimburse pharmacies

under a set schedule. To standardize payments for medicinal drugs, the

program has devised a fee schedule based on the Average Wholesale Price

(AWP) of each individual drug plus a dispensing fee established by the

Director. AWP prices will be obtained from a file provided by a

nationally recognized vendor containing medicinal drugs listed by their

unique National Drug Codes (NDCs). AWP prices will be updated on a

regular basis.

The AWP is set by the industry, and represents what pharmacies are

expected to pay for the drug. The dispensing fee will be twenty percent

of the cost of the drug up to a maximum of $12.50. Thus, if the AWP of

a drug is $20.00, there would be a dispensing fee of $4.00, and the

maximum allowable charge for the drug would be $24.00. If the AWP of

the drug was $500.00, however, the dispensing fee would be limited to

$12.50, and the maximum allowable charge would be $512.50.

The basic methodology is widely practiced. In all, 23 state

workers' compensation programs have some form of control over drug

costs through the use of a maximum allowable schedule; 17 of these

states have a set schedule for prescription drugs and six more have

reimbursement formulas based on average wholesale price similar to that

proposed for the FECA program or comparable data. OWCP's Division of

Coal Mine Workers' Compensation uses this formula for reimbursement of

drugs under the Black Lung Benefits Act.

Hospital bills: Proposed Sec. 10.810 concerns hospital bills.

Currently, only hospital outpatient services are subject to a fee

schedule. The OWCP now proposes to reimburse hospital inpatient

services under a prospective payment system (PPS) that is based on the

systems used by the Health Care Financing Administration's Medicare

program (42 CFR parts 412 et al).

The OWCP now proposes to use the HCFA prospective payment system

(PPS) using Diagnostic Related Groups (DRGs) (42 CFR part 412, et al.)

as the foundation of a PPS for determining the allowable reimbursement

for inpatient services covered under FECA. OWCP has already

successfully converted the foundation of its professional medical fee

schedule to the HCFA RVUs, and the use of the HCFA PPS will establish a

common base for payment of medical services under both agencies. OWCP's

proposal to use the HCFA PPS is compatible with hospital inpatient cost

control measures used by other federal agencies such as the Department

of Veterans Affairs (VA) and the Department of Defense, Civilian Health

and Medical Program of the Uniformed Services (CHAMPUS), who are also

using DRG-based reimbursement systems. In addition, several state

workers' compensation programs are using DRG-based systems to control

the cost of inpatient services for work-related injuries.

The HCFA PPS is based on the premise that similar medical

conditions and surgeries require similar inpatient services and

resources, and that those conditions and surgeries can be categorized

into DRGs according to the primary diagnoses and major surgical

procedures performed, as coded under the International Classification

of Diseases, 9th Revision (ICD-9-CM). Under the HCFA PPS, hospitals

receive a fixed, predetermined reimbursement for each beneficiary's

inpatient stay according to the assigned DRG and whether or not the

length of stay is considered to be an outlier (the number of inpatient

days is not within the nationally calculated range for the assigned

DRG).

Under the HCFA PPS, the reimbursement rate is hospital-specific and

is determined through a complex formula that considers national average

costs for all inpatient services, geographic wage and overhead indices,

medical education costs, patient mix, indigent care costs, and capital

investments. The HHS PPS DRG rates are updated each year and are

described in detail in the Federal Register (42 CFR part 412, et al.)

OWCP's decision to use the HCFA PPS as the foundation of its

reimbursement system is based on research that explored available

options, and on a study of FECA inpatient bills. OWCP reviewed a

representative sample of inpatient services reimbursed under FECA,

assigned DRGs in accordance with the HCFA DRG grouper rules, and used

the HCFA pricer program to determine allowable amounts under Medicare.

In the study, fourteen DRGs accounted for 61% of the dollars billed

and 64% of the inpatient stays. A wide range of diagnostic conditions

and medical procedures were represented in the study, nevertheless, and

they comprised a diverse list of DRGs. It is evident from the study

analyses that there is considerable variation in the amounts different

hospitals bill FECA for similar services. These billed amounts are

greater by a mean of 45% than the amounts that would be allowed if the

inpatient stay were paid under the HCFA PPS.

In instances of musculoskeletal soft tissue injuries, however, the

OWCP study indicated that the injured worker under FECA may at times

require a very short stay compared to that common for a patient under

HCFA's Medicare program. For that reason, the billed amounts under FECA

were in some cases actually less than that allowed under the HCFA PPS

for the same DRG. Short inpatient stays, however, are not uncommon for

work-related injuries and often are considered appropriate for post-

trauma observation and for diagnostic procedures. Services at

psychiatric and rehabilitation hospitals were excluded from this

portion of the analysis because they are not currently subject to the

HHS PPS for acute care.

Although there are differences in the medical conditions treated

under the HCFA and the FECA beneficiary populations, the study

indicated that the HCFA PPS using DRGs is well-suited to OWCP's efforts

to expand its ability to monitor and control inpatient costs covered

under FECA. Other federal agencies have reached similar conclusions,

such as CHAMPUS (32 CFR part 199) and the VA (38 CFR 17.55).

HCFA currently collects comprehensive hospital-specific fiscal

data, and has considerable experience in this regard. They have been

paying for inpatient services under a PPS since October 1983. OWCP does

not have the resources to collect such data now or in the foreseeable

future. In addition, the Department believes that duplicate collection

of data is not an efficient use of staff and resources.

It is proposed, therefore, that OWCP base reimbursement of

inpatient services covered under FECA on the HCFA PPS as described

below:

a. Hospitals must submit bills for inpatient services covered under

FECA on the Standard Form UB-92, or its equivalent, with all common

information completed. This information includes the hospital's

Medicare number, the patient's Social Security number, the FECA claim

number when available, the billed amount, and the primary conditions

[[Page 67132]]

treated and procedures performed coded under the current edition of the

International Classification of Diseases, 9th Revision, Clinical

Modification (ICD-9-CM), Volumes I, II, and III, and/or in accordance

with that specified in the yearly update of the HCFA regulations (42

CFR part 412, et. al.)

b. OWCP's adaptation of the HCFA PPS includes use of the HCFA

grouper and pricer programs, and an adjustment factor (AF) to the HCFA

DRG maximum allowable, which considers the uniqueness of work-related

injuries. For example, the median age of the FECA patient is about 42

years, rather than over 65, as is the case under the Medicare program.

Secondly, a low volume of FECA patients is expected at any one hospital

compared to the number of patients covered under the Medicare program.

Thirdly, at times there will be a need for more comprehensive

diagnostic and test procedures to determine the work-relatedness of

conditions, and/or conditions that may delay return to work. Finally,

FECA patients may have nationally common length of stays (LOSs)

different than those for Medicare patients, and FECA's goal to return

injured employees to work as soon as possible is not a Medicare goal

for a retired population.

OWCP believes, however, that the HCFA PPS is well-suited to be the

foundation of an OWCP PPS for inpatient services, and that it provides

a comprehensive data resource not otherwise available to the

Department. OWCP's proposal to use an adjustment factor (AF) to adapt

the HCFA PPS to individual program needs is consistent with similar

methods used by other federal and state agencies. The AFs used under

the OWCP PPS are based on the results of comprehensive studies of

inpatient services conducted by OWCP in 1996 and 1990, and on ongoing

analyses of medical costs and services provided under FECA.

c. Under OWCP's proposed PPS, the HCFA allowable for a specific DRG

at a particular facility constitutes OWCP's Threshold Amount (TA) for

the DRG. The OWCP AF to each TA considers: (1) Lengths of stay (LOS)

that are outside the HCFA LOS parameters; (2) LOS that are within the

HCFA LOS parameters but under OWCP are consistently on the short or

long end of the parameter for particular DRGs; and (3) cost outliers

that are the result of unique care requirements, particularly expensive

hardware such as that frequently used in joint replacements, or are

attributable to inflated charges.

In addition: (1) The proposed OWCP PPS per diem rate will not be

less than that allowable under the HCFA DRG program when based on the

50th percentile LOS as reported in the Federal Register by HCFA for the

Medicare program; and (2) the total dollar amounts reduced from billed

amounts will be consistent with reduction rates under other portions of

the OWCP medical fee schedule and with cost to charge ratios for

inpatient services reported by HCFA.

The following abbreviations are used in OWCP's formulae for setting

the AF:

TA--Threshold Amount--the HCFA Medicare program maximum allowable for a

specific DRG at a particular facility.

TA/H50--Threshold Amount Per Diem rate--the daily rate when the TA is

divided by the HCFA national 50th percentile LOS days.

HCFA LOS--The length of stay days as defined under the HCFA national

data sets reported in the Federal Register yearly; three sets are used

for these formulae:

H25 = 25th percentile

H50 = 50th percentile

H75 = 75th percentile

OWCP LOS--The actual number of inpatient days billed for covered

services provided a claimant under FECA.

OWCP's formulae for setting the AF are:

(1) The OWCP DRG standard maximum allowable (MA)

The OWCP LOS is within the HCFA LOS parameters, the 25th (H25) to

the 75th (H75) percentiles, and the billed amount is not greater than

twice the OWCP TA.

(TA x 1.24)--[(TA/H50*0.12) * (H75-LOS)] = MA

(2) The OWCP Short Stay Maximum Allowable (MASS)

The OWCP LOS is less than the HCFA 25th percentile (H25). Short

stays regardless of billed amounts are covered under this formula.

[(TA/H50) * (1.72*LOS)] + [(TA/H50*0.33) * (H50-LOS)] = MASS

This formula allows for higher costs typically associated with the

first days of an inpatient stay, and an incentive allowance for IP days

less than the H25.

(3) The OWCP Long Stay and/or Cost Outlier Maximum Allowable (MACO)

The OWCP LOS is (a) greater than the HCFA 75th (H75) percentile

LOS, considered a long stay, or (b) the billed amount is considered a

cost outlier (greater than twice the TA) but the LOS is within the HCFA

LOS parameters (H25 to H75).

(TA x 1.24) + [(Billed Amount-(TA x 1.24)) x 0.50] = MACO

This formula adjusts for the outlier length of stay, or

confinements with documented outlier costs when the length of stay is

within the H25-H75. The costs beyond the OWCP MA, however, are only

paid at 50% of the billed amount. There is no additional adjustment for

number of inpatient days. If the long stay billed amount is less than

the TA x 1.24, then no charges are paid at the 50% rate.

These formulae always result in a payment greater than the HCFA

Medicare program allowable per diem rate (TA/H50). They are consistent

with reimbursement principles used by CHAMPUS, the VA, and state

workers' compensation programs for short and long stays, and for cost

outliers.

d. OWCP proposes to use a separate schedule to reimburse facilities

not covered (FNCs) under the HCFA PPS, such as those that only provide

rehabilitation or psychiatric services. The information required on

each bill will be the same as that required of acute care facilities,

including ICD-9-CM coding of diagnostic conditions being treated and

any major procedures performed. During a two-year phase-in period, this

FNC schedule is to be based on HCFA-calculated cost to charge ratio

(CCR) data for acute care inpatient services, currently set at about

55%, on data shared by CHAMPUS and state workers' compensation

programs, and on the 1996 OWCP inpatient hospital services study.

The FNC schedule will be applied to inpatient services provided at

FNCs when CCR data is available to OWCP. When CCR data is not

available, reimbursements will be negotiated prior to services based on

locality FNC estimated CCR and available cost data.

FNC Per diem rate * CCR * 1.24 = FNC MA

Outlier costs will be negotiated based on the FNC formula.

20 CFR Part 25

Subpart A--General Provisions

Former Sec. 25.3 regarding the use of local workers' compensation

law and the Special Schedule has been deleted as unnecessary.

Subpart C--Extensions of the Special Schedule of Compensation

Section 25.200(a) now includes a specific statement that direct-

hire employees of the U.S. Military Forces covered by the Philippine

Medical Care Program and the Employees' Compensation Program pursuant

to the agreement signed by the United States and the Republic of the

Philippines on March 10, 1982 who are also members

[[Page 67133]]

of the Philippine Social Security System are not covered by the

modified Special Schedule that is otherwise applicable in the Republic

of the Philippines.

In addition, old reserved Secs. 25.23 and 25.24 have been deleted

as unnecessary. Furthermore, old Sec. 25.25 has also been deleted to

reflect OWCP's prior policy determination (and concomitant

administrative practice) to apply the lesser of the provisions of local

law in the Republic of Korea or FECA (not the special schedule).

Statutory Authority

Section 8149 of the Federal Employees' Compensation Act, (5 U.S.C.

8101, et seq.), provides the general statutory authority for the

Secretary to prescribe rules and regulations necessary for

administration and enforcement of the Act. Section 5 U.S.C. 8103

provides specific authority regarding medical treatment and care,

including determining the appropriateness of charges. The Debt

Collection Act of 1982, as amended authorizes imposition of interest

charges and collection of debts by withholding funds due the debtor.

Executive Order 12866

This proposed regulatory action constitutes a ``significant'' rule

within the meaning of Executive Order 12866. The Department believes,

however, that this regulatory action will not have a significant

economic impact on the economy, or any person or organization subject

to the proposed changes. The proposed changes will have little or no

effect on the level of benefits paid (which in any case involve

payments almost exclusively to Federal employees from funds

appropriated by Congress); nor will there be a significant economic

impact upon the hospitals and pharmacies which, for the first time,

will be subject to the fee schedules established by these rules. The

total dollar amount paid for inpatient hospital services in fiscal year

1996 was $81,955,562.00, and subjecting these charges to the DRG

schedule is expected to result in a 20 percent decrease in the amount

paid, or about $16.4 million. The total dollar amount paid for pharmacy

costs in fiscal year 1996 was $31.9 million, and subjecting these

charges to the fee schedule is expected to result in a 10 to 15 percent

decrease in the amount paid, or about $3-4.5 million. Insofar as the

proposed amendments make it easier to seek benefits under the FECA and

streamline the administration of the program, they would decrease

administrative costs. The proposed changes have been reviewed by the

Office of Management and Budget for consistency with the President's

priorities and the principles set forth in Executive Order 12866.

Unfunded Mandates Reform Act

For purposes of the Unfunded Mandates Reform Act of 1995, as well

as E.O. 12875, this rule does not include any federal mandate that may

result in increased expenditures by state, local and tribal

governments, or increased expenditures by the private sector of more

than $100 million.

Paperwork Reduction Act

The new collection of information contained in this rulemaking has

been submitted for review to the Office of Management and Budget (OMB)

in accordance with the Paperwork Reduction Act of 1995. No person is

required to respond to a collection of information request unless the

collection of information displays a valid OMB control number.

The new information collection requirements contained in this

proposed rule are set forth in Secs. 10.801 and 10.802, and they relate

to information required to be submitted by pharmacies and hospitals

covering certain in-patient bills. The Department is proposing to

create a new form (Universal Pharmacy Billing Form) which will be used

by pharmacies in submitting claims for payment. Another form (the

claimant reimbursement form) will be used by claimants seeking

reimbursement for medical expenses for which they have paid the

providers directly. The public reporting burden for these collections

of information is estimated to average as follows: Universal Pharmacy

Billing Form--It will take five (5) minutes to complete the form,

including time for reviewing instructions, searching existing data

sources, gathering and maintaining the data needed and completing and

reviewing the collection of information; Claimant Reimbursement Form--

we estimate it will take an average of ten (10) minutes to complete

this form, including reviewing instructions, searching for existing

data sources, gathering and maintaining the data needed, and completing

and reviewing the collection of information.

The Department would like to solicit comments to:

(1) Evaluate whether the proposed collection of information is

necessary for the proper performance of the functions of the agency,

including whether the information will have practical utility;

(2) Evaluate the accuracy of the agency's estimate of the burden of

the proposed collection of information, including the validity of the

methodology and assumptions used;

(3) Enhance the quality, utility, and clarity of the information to

be collected; and

(4) Minimize the burden of the collection of information on those

who are to respond, including through the use of appropriate automated

electronic, mechanical, or other technological collection techniques or

other forms of information technology, e.g., permitting electronic

submission of responses.

Type of Review: New Collection.

Agency: Employment Standards Administration.

Title: Claimant Medical Reimbursement Form (CA-915).

OMB Number: None.

Affected Public: Individuals or households, Federal Government.

Total Respondents: 40,500.

Frequency: On occasion.

Total Responses: 40,500.

Average Time per Response: 10 minutes.

Total Hours: 6,723.

Total Burden Cost (capital/startup): 0.

Total Burden Cost (operating/maintenance): 0.

Type of Review: New Collection.

Agency: Employment Standards Administration.

Title: NCPDP Universal Pharmacy Billing Form (79-1A).

OMB Number: None.

Affected Public: Businesses or other for-profit; Not-for-profit

Institutions; Individuals or households; Federal Government; State,

Local or Tribal Government.

Total Respondents: 406,198.

Frequency: On occasion.

Total Responses: 406,198.

Average Time per Response: 5 minutes.

Total Hours: 33,714.

Total Burden Cost (capital/startup): 0.

Total Burden Cost (operating/maintenance): 0.

Send comments regarding this burden estimate or any other aspect of

this collection of information, including suggestions for reducing this

burden to the Office of information Management, U.S. Department of

Labor, Room N-1301, 200 Constitution Avenue, Washington, DC, 20210; and

to the Office of Information and Regulatory Affairs, Attn: ESA Desk

Officer, OMB New Executive Office Bldg., 725 17th Street NW., Room

10235, Washington, DC 20003.

Regulatory Flexibility Act

The Department believes that the rule will have ``no significant

economic impact upon a substantial number of small entities'' within

the meaning of

[[Page 67134]]

section 3(a) of the Regulatory Flexibility Act. Pub. L. No. 96-354, 91

Stat. 1164 (5 U.S.C. 605(b)). The provisions of the proposed rules

extending cost control measures to hospital inpatient services and

pharmacies is the only provision of the regulations which may have a

monetary effect on small businesses. That effect will not be

significant on a substantial number of those businesses, however, for

no one business bills a significant amount to OWCP for FECA-related

services, and the effect on those bills which are submitted, while a

worthwhile savings for the government in the aggregate, will not be

significant for individual businesses affected.

The two new cost containment provisions are: (1) a set schedule for

payment of pharmacy bills; and (2) a prospective payment system for

hospital inpatient services. The two methodologies are fully explained

in the text of the preamble, including the fact that the use of

Diagnostic Related Groups (DRGs) for setting payment for in-patient

hospital charges essentially is an adaptation of a system used by the

Health Care Finance Agency (HCFA) in payment of Medicare bills. The use

of Average Wholesale Prices (AWP) in setting the maximum reimbursable

amount for pharmacy bills is also commonplace in the industry.

The method selected by OWCP is therefore one which contains

efficiencies both for the government and providers. The government

benefits because OWCP did not reinvent the wheel, but minimized

resources by adopting existing and well-recognized systems already in

place. The providers benefit because submitting a bill to OWCP and

receiving payment will be almost the same process as submitting it to

Medicare, a program with which hospitals are already familiar and have

in place for billing, so they will not have to learn a new process and

the FECA bills will not represent an unnecessary administrative cost

because the FECA bill process will not be essentially distinguished

from that for Medicare. Similarly, the pharmacies are used to billing

through clearing houses and having charges subject to limits by private

insurers. By adopting the uniform billing statement and a familiar cost

control methodology, OWCP has kept close to the environment with which

the pharmacies are already familiar. The methods chosen, therefore,

represent a familiar environment to the providers.

The costs savings resulting from the implementation of these cost

containment methods are significant only in the aggregate and will have

no significant effect on any individual businesses. First, the need for

cost containment in the FECA program is self evident and these methods

are already utilized by Medicare, CHAMPUS and Veterans Administration

among government entities, and for the private insurance carriers which

cover Federal employees as part of the Federal employees' health

benefit insurance programs. The costs to providers whose charges may be

reduced are relatively small, both in incremental and in actual terms.

Incrementally, FECA bills simply do not represent a large share of

any one provider's total business. Since Federal employees are spread

throughout the United States and this system covers only those Federal

employees who are injured on the job and require either prescription

drugs or inpatient hospital care (a tiny subset of all employees), the

number of bills submitted by any one provider which may be subject to

these provisions is likely to be very small.

Second, in actual terms, the amount by which these bills might be

reduced will not have a significant impact on any business. As noted

earlier in this preamble, in fiscal year (FY) 1996, the program paid

$81.9 million dollars on about 15,700 bills received for in-patient

hospital services (an average charge of $5,225.00 per stay). The total

number of hospitals on our provider files is about 5,000, for an

average patient load of slightly over three FECA-claimant patients per

hospital. If we assume that no hospital had more than three patients,

then the average annual billings subject to these rules for any

hospital would be about $15,775 (3 x $5,225). As also noted earlier in

the preamble, the DRG method will reduce the $81.9 million by about 20

percent, or $16.4 million. Thus, the average dollar amount of the

reduction in bills submitted by any one hospital resulting from these

rules would be about $3,150.00.

A similarly small actual dollar reduction applies to pharmacy

charges. OWCP paid about $32,000,000 for pharmacy charges, although we

cannot identify exactly what portion of this amount was paid to

institutions, since much of this dollar figure represents

reimbursements directly to claimants. We cannot identify with certainty

the number of pharmacies who provided supplies, for the same reason,

but there are about 4,000 pharmacies in our provider files. Similarly,

we cannot determine the exact number of bills paid, since we capture

only those submitted by a provider for direct payment and not those

submitted by a claimant for reimbursement. Assuming for purposes of

this analysis that the reimbursements were evenly divided among

pharmacies already part of our provider files, we divide 4,000

providers in to the total number of dollars paid to get an average

annual aggregate of charges paid to a provider of about $8,000.00. It

is estimated that the schedule would result in an average reduction of

five percent in pharmacy charges; based on these figures, the average

pharmacy would see a reduction in the total amount of charges submitted

of about $400.

These figures illustrate that the ``cost'' of these rules to any

one provider is negligible. On the other hand, OWCP will see

substantial aggregate cost savings as a result (estimated at

$18,000,000). These savings benefit OWCP (by strengthening the

integrity of the program), the employing agencies (which ultimately

foot the bill for FECA through the chargeback system), and taxpayer and

rate payers to whom the ultimate costs of the program are eventually

charged through appropriations.

The Assistant Secretary for Employment Standards has certified to

the Chief Counsel for Advocacy of the Small Business Administration

that these rules will not have a significant impact on a substantial

number of small entities. Accordingly, no regulatory impact analysis is

required.

List of Subjects for 20 CFR Parts 10 and 25

Administrative practice and procedures, Claims, Government

employees, Labor, Workers' compensation.

For the reasons set forth in the preamble, it is proposed that 20

CFR Chapter I be amended as follows:

1. It is proposed that part 10 be revised to read as follows:

PART 10--CLAIMS FOR COMPENSATION UNDER THE FEDERAL EMPLOYEES'

COMPENSATION ACT, AS AMENDED

Subpart A--General Provisions

Sec.

Introduction

10.0 What are the provisions of the FECA, in general?

10.1 What rules govern the administration of the FECA and this

chapter?

10.2 What do these regulations contain?

10.3 Have the collection of information requirements of this part

been approved by OMB?

Definitions and Forms

10.5 What definitions apply to these regulations?

10.6 What special statutory definitions apply to dependents and

survivors?

[[Page 67135]]

10.7 What forms are needed to process claims under the FECA?

Information in Program Records

10.10 Are all documents relating to claims filed under the FECA

considered confidential?

10.11 Who maintains custody and control of FECA records?

10.12 How may a FECA claimant or beneficiary obtain copies of

protected records?

10.13 What process is used by a person who wants to correct FECA-

related documents?

Rights and Penalties

10.15 May compensation rights be waived?

10.16 What are the criminal law penalties for making a false report

in connection with a claim under the FECA?

10.17 Is a beneficiary who defrauds the government in connection

with a claim for benefits still entitled to those benefits?

10.18 Can a beneficiary who is incarcerated based on a felony

conviction still receive benefits?

Subpart B--Filing Notices and Claims; Submitting Evidence

Notices and Claims for Injury, Disease and Death--Employee or

Survivor's Actions

10.100 How and when is a notice of traumatic injury filed?

10.101 How and when is a claim for wage loss compensation on

account of traumatic injury filed?

10.102 How and when is a notice of occupational disease filed?

10.103 How and when is a claim for wage loss compensation on

account of occupational disease filed?

10.104 How and when is a claim for permanent impairment filed?

10.105 How and when is a claim for recurrence filed?

10.106 How and when is a notice of death and claim for benefits

filed?

Notices and Claims for Injury, Disease and Death--Employer's

Actions

10.110 What should the employer do when an employee files a notice

of traumatic injury or occupational disease?

10.111 What should the employer do when an employee files an

initial claim for compensation due to disability or permanent

impairment?

10.112 What should the employer do when an employee files a claim

for continuing compensation due to disability?

10.113 What should the employer do when an employee dies from a

work-related injury or disease?

Evidence and Burden of Proof

10.115 What evidence is needed to establish a claim?

10.116 What additional evidence is needed in cases based on

occupational disease?

10.117 What happens if the employer contests any of the facts as

stated by the claimant?

10.118 Does the employer participate in the claims process in any

other way?

10.119 What action will OWCP take with respect to information

submitted by the employer?

10.120 May a claimant submit additional evidence?

10.121 What happens if OWCP needs more evidence from the claimant?

Decisions on Entitlement to Benefits

10.125 How does OWCP determine entitlement to benefits?

10.126 What does the decision contain?

10.127 To whom is the decision sent?

Subpart C--Continuation of Pay

10.200 What is continuation of pay?

Eligibility for COP

10.205 What other conditions must be met to receive COP?

10.206 May an employee who uses leave after an injury later decide

to use COP instead?

10.207 May an employee who returns to work, then stops work again

due to the effects of the injury, receive COP?

Responsibilities

10.210 What are the employee's responsibilities in COP cases?

10.211 What are the employer's responsibilities in COP cases?

Calculation of COP

10.215 How does OWCP compute the number of days of COP used?

10.216 How is the pay rate for COP calculated?

10.217 Is COP charged if the employee continues to work, but in a

different job that pays less?

Controversion and Termination of COP

10.220 When is an employer not required to pay COP?

10.221 How is a claim for COP controverted?

10.222 When may an employer terminate COP which has already begun?

10.223 Are there other circumstances under which OWCP will not

authorize payment of COP?

10.224 What happens if OWCP finds that the employee is not entitled

to COP after it has been paid?

Subpart D--Medical and Related Benefits

Emergency Medical Care

10.300 What are the basic rules for authorizing emergency medical

care?

10.301 May the physician designated on Form CA-16 refer the

employee to another medical specialist or medical facility?

10.302 Should the employer authorize medical care if he or she

doubts that the injury occurred, or that it is work-related?

10.303 Should the employer use a Form CA-16 to authorize medical

testing when an employee is exposed to a workplace hazard just once?

10.304 Are there any exceptions to these procedures?

Medical Treatment and Related Issues

10.310 What are the basic rules for obtaining medical care?

10.311 What are the special rules for the services of

chiropractors?

10.312 What are the special rules for the services of clinical

psychologists?

10.313 Will OWCP pay for preventive treatment?

10.314 Will OWCP pay for the services of an attendant?

10.315 Will OWCP pay for transportation to obtain medical

treatment?

10.316 After selecting a treating physician, may an employee choose

to be treated by another physician instead?

Directed Medical Examinations

10.320 Can OWCP require an employee to be examined by another

doctor?

10.321 What happens if the physician selected by OWCP does not

agree with the physician selected by the employee?

10.322 Who pays for second opinion and referee examinations?

10.323 What are the consequences of failing to report for or

obstructing a second opinion or referee examination?

10.324 May an employer require an employee to undergo a physical

examination in connection with a work-related injury?

Medical Reports

10.330 What are the requirements for medical reports?

10.331 How and when should the medical report be submitted?

10.332 What additional medical information will OWCP require to

support continuing payment of benefits?

10.333 What additional medical information will OWCP require to

support a claim for a schedule award?

Medical Bills

10.335 How are medical bills submitted?

10.336 What are the time frames for submitting bills?

10.337 If OWCP reimburses an employee only partially for a medical

expense, must the provider refund the balance of the amount paid to

the employee?

Subpart E--Compensation and Related Benefits

Compensation for Disability and Impairment

10.400 What is total disability?

10.401 When and how is compensation for total disability paid?

10.402 What is partial disability?

10.403 When and how is compensation for partial disability paid?

10.404 When and how is compensation for a schedule impairment paid?

10.405 Who is considered a dependent in a claim based on disability

or impairment?

10.406 What are the maximum and minimum rates of compensation in

disability cases?

[[Page 67136]]

Compensation for Death

10.410 What are the rates of compensation payable in death cases?

10.411 What are the maximum and minimum rates of compensation in

death cases?

10.412 Will OWCP pay the costs of burial and transportation of the

remains?

10.413 If a person dies while receiving a schedule award, to whom

is the balance of the schedule award payable?

10.414 What reports of dependents are needed in death cases?

10.415 What must a beneficiary do if the number of beneficiaries

decreases?

10.416 How does a change in the number of beneficiaries affect the

amount of compensation paid to the other beneficiaries?

10.417 What reports are needed when compensation payments continue

for children over age 18?

Adjustments to Compensation

10.420 How are cost-of-living adjustments applied?

10.421 May a beneficiary receive other kinds of payments from the

federal government concurrently with compensation?

10.422 May compensation payments be issued in a lump sum?

10.423 May compensation payments be assigned to, or attached by,

creditors?

10.424 May someone other than the beneficiary be designated to

receive compensation payments?

Overpayments

10.430 How does OWCP notify an individual of a payment made?

10.431 What does OWCP do when an overpayment is identified?

10.432 How can an individual present evidence to OWCP in response

to a preliminary notice of an overpayment?

10.433 Under what circumstances can OWCP waive recovery of an

overpayment?

10.434 If OWCP finds that the recipient of an overpayment was not

at fault, what criteria are used to decide whether to waive recovery

of it?

10.435 Is an individual responsible for an overpayment that

resulted from an error by OWCP or another government agency?

10.436 Under what circumstances would recovery of an overpayment

defeat the purpose of the FECA?

10.437 Under what circumstances would recovery of an overpayment be

against equity and good conscience?

10.438 Can OWCP require the individual who received the overpayment

to submit additional financial information?

10.439 May other issues be addressed at the pre-recoupment hearing?

10.440 How does OWCP communicate its final decision concerning

recovery of an overpayment, and what appeal right accompanies it?

10.441 How are overpayments collected?

Subpart F--Continuing Entitlement to Benefits

10.500 What are the basic rules governing continuing receipt of

compensation benefits?

Return to Work--Employer's Responsibilities

10.505 What actions must the employer take?

10.506 May the employer monitor the employee's medical care?

10.507 How should the employer make an offer of suitable work?

10.508 May relocation expenses be paid for an employee who would

need to move to accept an offer of reemployment?

10.509 If an employee's light-duty job is eliminated due to

downsizing, what is the effect on compensation?

Return to Work--Employee's Responsibilities

10.515 What actions must the employee take?

10.516 How will an employee know if OWCP considers a job to be

suitable?

10.517 What are the penalties for refusing to accept a suitable job

offer?

10.518 Does OWCP provide services to help employees return to work?

10.519 What action will OWCP take if an employee refuses to undergo

vocational rehabilitation?

10.520 How does OWCP determine compensation after an employee

completes a vocational rehabilitation program?

Reports of Earnings From Employment and Self-Employment

10.525 What information must the employee report?

10.526 Must the employee report self-employment?

10.527 Does OWCP verify reports of earnings?

10.528 What action will OWCP take if the employee fails to file a

report of activity indicating an ability to work?

10.529 What action will OWCP take if the employee files an

incomplete report?

Reports of Dependents

10.535 How are dependents defined, and what information must the

employee report?

10.536 What is the penalty for failing to submit a report of

dependents?

10.537 What reports are needed when compensation payments continue

for children over age 18?

Reduction and Termination of Compensation

10.540 When and how is compensation reduced or terminated?

10.541 What action will OWCP take after issuing written notice of

its intention to reduce or terminate compensation?

Subpart G--Appeals Process

10.600 How can final decisions of OWCP be reviewed?

Reconsiderations and Reviews by the Director

10.605 What is reconsideration?

10.606 How does a claimant request reconsideration?

10.607 What is the deadline for requesting reconsideration?

10.608 How does OWCP decide whether to grant or deny the request

for reconsideration?

10.609 How does OWCP decide whether new evidence requires

modification of the prior decision?

10.610 What is a review by the Director?

Hearings

10.615 What is a hearing?

10.616 How does a claimant obtain a hearing?

10.617 How is an oral hearing conducted?

10.618 How is a review of the written record conducted?

10.619 May subpoenas be issued for witnesses and documents?

10.620 Who pays the costs associated with subpoenas?

10.621 What is the employer's role when an oral hearing has been

requested?

10.622 May a claimant withdraw a request for or postpone a hearing?

Reviews by the Employees' Compensation Appeals Board (ECAB)

10.625 What kinds of decisions may be appealed?

10.626 Who has jurisdiction of cases on appeal to the ECAB?

Subpart H--Special Provisions

Representation

10.700 May a claimant designate a representative?

10.701 Who may serve as a representative?

10.702 How are fees for services paid?

10.703 How are fee applications approved?

Third Party Liability

10.705 When must an employee or other FECA beneficiary take action

against a third party?

10.706 How will a beneficiary know if OWCP or SOL has determined

that action against a third party is required?

10.707 What must a FECA beneficiary who is required to take action

against a third party do to satisfy the requirement that the claim

be ``prosecuted''?

10.708 Can a FECA beneficiary who refuses to comply with a request

to assign a claim to the United States or to prosecute the claim in

his or her own name be penalized?

10.709 What happens if a beneficiary directed by OWCP or SOL to

take action against a third party does not believe that a claim can

be successfully prosecuted at a reasonable cost?

10.710 Under what circumstances must a recovery of money or other

property in connection with an injury or death for which benefits

are payable under the FECA be reported to OWCP or SOL?

10.711 How much of any settlement or judgment must be paid to the

United States?

10.712 What amounts are included in the gross recovery?

[[Page 67137]]

10.713 How is a structured settlement (that is, a settlement

providing for receipt of funds over a specified period of time)

treated for purposes of reporting the gross recovery?

10.714 What amounts are included in the refundable disbursements?

10.715 Is a beneficiary required to pay interest on the amount of

the refund due to the United States?

10.716 If the required refund is not paid within 30 days of the

request for repayment, can it be collected from payments due under

the FECA?

10.717 Is a settlement or judgment received as a result of

allegations of medical malpractice in treating an injury covered by

the FECA a gross recovery that must be reported to OWCP or SOL?

10.718 Are payments to a beneficiary as a result of an insurance

policy which the beneficiary has purchased a gross recovery that

must be reported to OWCP or SOL?

10.719 If a settlement or judgment is received for more than one

wound or medical condition, can the refundable disbursements paid on

a single FECA claim be attributed to different conditions for

purposes of calculating the refund or credit owed to the United

States?

Federal Grand and Petit Jurors

10.725 When is a federal grand or petit juror covered under the

FECA?

10.726 When does a juror's entitlement to disability compensation

begin?

10.727 What is the pay rate of jurors for compensation purposes?

Peace Corps Volunteers

10.730 What are the conditions of coverage for Peace Corps

volunteers and volunteer leaders injured while serving outside the

United States?

10.731 What is the pay rate of Peace Corps volunteers and volunteer

leaders for compensation purposes?

Non-Federal Law Enforcement Officers

10.735 When is a non-federal law enforcement officer covered under

the FECA?

10.736 What are the time limits for filing a claim?

10.737 How is a claim filed, and who can file a claim?

10.738 Under what circumstances are benefits payable?

10.739 What kind of objective evidence of a potential federal crime

must exist for coverage to be extended?

10.740 In what situations will OWCP automatically presume that a

law enforcement officer is covered by the FECA?

10.741 How are benefits calculated?

Subpart I--Information for Medical Providers

Medical Records and Bills

10.800 What kind of medical records must providers keep?

10.801 How are medical bills to be submitted?

10.802 How should an employee prepare and submit requests for

reimbursement for medical expenses, transportation costs, loss of

wages, and incidental expenses?

10.803 What are the time limitations on OWCP's payment of bills?

Medical Fee Schedule

10.805 What services are covered by the OWCP fee schedule?

10.806 How are the maximum fees defined?

10.807 How are payments for particular services calculated?

10.808 Does the fee schedule apply to every kind of procedure?

10.809 How are payments for medicinal drugs determined?

10.810 How are payments for inpatient medical services determined?

10.811 When and how are fees reduced?

10.812 If OWCP reduces a fee, may a provider request

reconsideration of the reduction?

10.813 If OWCP reduces a fee, may a provider bill the claimant for

the balance?

Exclusion of Providers

10.815 What are the grounds for excluding a provider from payment

under the FECA?

10.816 What will cause OWCP to automatically exclude a physician or

other provider of medical services and supplies?

10.817 When are OWCP's exclusion procedures initiated?

10.818 How is a provider notified of OWCP's intent to exclude him

or her?

10.819 What requirements must the provider's reply and OWCP's

decision meet?

10.820 How can an excluded provider request a hearing?

10.821 How are hearings assigned and scheduled?

10.822 How are subpoenas or advisory opinions obtained?

10.823 How will the administrative law judge conduct the hearing

and issue the recommended decision?

10.824 How can a party request review by the Director of the

administrative law judge's recommended decision?

10.825 What are the effects of exclusion?

10.826 How can an excluded provider be reinstated?

Authority: 5 U.S.C. 301, 8103, 8145 and 8149; 31 U.S.C. 3716 and

3717; Reorganization Plan No. 6 of 1950, 15 FR 3174, 64 Stat. 1263;

Secretary's Order 5-96, 62 FR 107.

Subpart A--General Provisions

Introduction

Sec. 10.0 What are the provisions of the FECA, in general?

The Federal Employees' Compensation Act (FECA) as amended (5 U.S.C.

8101 et seq.) provides for the payment of workers' compensation

benefits to civilian officers and employees of all branches of the

Government of the United States. The regulations in this part describe

the rules for filing, processing, and paying claims for benefits under

the FECA.

(a) The FECA has been amended and extended a number of times to

provide workers' compensation benefits to volunteers in the Civil Air

Patrol (5 U.S.C. 8141), members of the Reserve Officers' Training Corps

(5 U.S.C. 8140), Peace Corps Volunteers (5 U.S.C. 8142), Job Corps

enrollees and Volunteers In Service to America (5 U.S.C. 8143), members

of the National Teachers Corps (5 U.S.C. 8143a), certain student

employees (5 U.S.C. 5351 and 8144), certain law enforcement officers

not employed by the United States (5 U.S.C. 8191-8193), and various

other classes of persons who provide or have provided services to the

Government of the United States.

(b) The FECA provides for payment of several types of benefits,

including compensation for wage loss, schedule awards, medical and

related benefits, and vocational rehabilitation services for conditions

resulting from injuries sustained in performance of duty while in

service to the United States.

(c) The FECA also provides for payment of monetary compensation to

specified survivors of an employee whose death resulted from a work-

related injury and for payment of certain burial expenses subject to

the provisions of 5 U.S.C. 8134.

(d) All types of benefits and conditions of eligibility listed in

this section are subject to the provisions of the FECA and of this

part. This section shall not be construed to modify or enlarge upon the

provisions of the FECA.

Sec. 10.1 What rules govern the administration of the FECA and this

chapter?

In accordance with 5 U.S.C. 8145 and Secretary's Order 5-96, the

responsibility for administering the FECA, except for 5 U.S.C. 8149 as

it pertains to the Employees' Compensation Appeals Board, has been

delegated to the Assistant Secretary for Employment Standards. The

Assistant Secretary, in turn, delegated the authority and

responsibility for administering the FECA to the Director of the Office

of Workers' Compensation Programs (OWCP). Except as otherwise provided

by law, the Director, OWCP and his or her designees have the exclusive

authority to administer, interpret and enforce the provisions of the

Act.

[[Page 67138]]

Sec. 10.2 What do these regulations contain?

Part 10 of this chapter sets forth the regulations governing

administration of all claims filed under the FECA, except to the extent

specified in certain particular provisions. Its provisions are intended

to assist persons seeking compensation benefits under the FECA, as well

as personnel in the various federal agencies and the Department of

Labor who process claims filed under the FECA or who perform

administrative functions with respect to the FECA. Part 10 applies to

part 25 of this chapter except as modified by part 25. The various

subparts of this part contain the following:

(a) Subpart A: The general statutory and administrative framework

for processing claims under the FECA. It contains a statement of

purpose and scope, together with definitions of terms, descriptions of

basic forms, information about the disclosure of OWCP records, and a

description of rights and penalties under the FECA, including

convictions for fraud.

(b) Subpart B: The rules for filing notices of injury and claims

for benefits under the FECA. It also addresses evidence and burden of

proof, as well as the process of making decisions concerning

eligibility for benefits.

(c) Subpart C: The rules governing claims for and payment of

continuation of pay.

(d) Subpart D: The rules governing emergency and routine medical

care, second opinion and referee medical examinations directed by OWCP,

and medical reports and records in general. It also addresses the kinds

of treatment which may be authorized and how medical bills are paid.

(e) Subpart E: The rules relating to the payment of monetary

compensation benefits for disability, impairment and death. It includes

the provisions for identifying and processing overpayments of

compensation.

(f) Subpart F: The rules governing the payment of continuing

compensation benefits. It includes provisions concerning the employee's

and the employer's responsibilities in returning the employee to work.

It also contains provisions governing reports of earnings and

dependents, recurrences, and reduction and termination of compensation

benefits.

(g) Subpart G: The rules governing the appeals of decisions under

the FECA. It includes provisions relating to hearings,

reconsiderations, and appeals before the Employees' Compensation

Appeals Board.

(h) Subpart H: The rules concerning legal representation and for

adjustment and recovery from a third party. It also contains provisions

relevant to three groups of employees whose status requires special

application of the provisions of the FECA: federal grand and petit

jurors, Peace Corps volunteers, and non-federal law enforcement

officers.

(i) Subpart I: Information for medical providers. It includes rules

for medical reports, medical bills, and the OWCP medical fee schedule,

as well as the provisions for exclusion of medical providers.

Sec. 10.3 Have the collection of information requirements of this part

been approved by OMB?

The collection of information requirements in this part have been

approved by the Office of Management and Budget and assigned OMB

control numbers 1215-0055, 1215-0067, 1215-0103, 1215-0115, 1215-0154,

1215-0155, 1215-0167, 1215-0176 and 1215-0182.

Definitions and Forms

Sec. 10.5 What definitions apply to these regulations?

Certain words and phrases found in this part are defined in this

section or in the FECA statute. Some other words and phrases that are

used only in limited situations are defined in the later subparts of

these regulations.

(a) Benefits or Compensation means the money OWCP pays to or on

behalf of a beneficiary from the Employees' Compensation Fund for lost

wages, a loss of wage-earning capacity or a permanent physical

impairment, as well as the money paid to beneficiaries for an

employee's death. These two terms also include any other amounts paid

out of the Employees' Compensation Fund for such things as medical

treatment, medical examinations conducted at the request of OWCP as

part of the claims adjudication process, vocational rehabilitation

services, services of an attendant and funeral expenses, but does not

include continuation of pay.

(b) Beneficiary means an individual who is entitled to a benefit

under the FECA and this part.

(c) Claim means a written assertion of an individual's entitlement

to benefits under the FECA, submitted in a manner authorized by this

part.

(d) Claimant means an individual whose claim has been filed.

(e) Director means the Director of OWCP or a person designated to

carry out his or her functions.

(f) Disability means the incapacity, because of an employment

injury, to earn the wages the employee was receiving at the time of

injury. It may be partial or total.

(g) Earnings from employment or self-employment means:

(1) Gross earnings or wages before any deductions and includes the

value of subsistence, quarters, reimbursed expenses and any other goods

or services received in kind as remuneration; or

(2) A reasonable estimate of the cost to have someone else perform

the duties of an individual who accepts no remuneration. Neither lack

of profits, nor the characterization of the duties as a hobby, removes

an unremunerated individual's responsibility to report the estimated

cost to have someone else perform his or her duties.

(h) Employee means, but is not limited to, an individual who fits

within one of the following listed groups:

(1) A civil officer or employee in any branch of the Government of

the United States, including an officer or employee of an

instrumentality wholly owned by the United States;

(2) An individual rendering personal service to the United States

similar to the service of a civil officer or employee of the United

States, without pay or for nominal pay, when a statute authorizes the

acceptance or use of the service, or authorizes payment of travel or

other expenses of the individual;

(3) An individual, other than an independent contractor or an

individual employed by an independent contractor, employed on the

Menominee Indian Reservation in Wisconsin in operations conducted under

a statute relating to tribal timber and logging operations on that

reservation;

(4) An individual appointed to a position on the office staff of a

former President; or

(5) An individual selected and serving as a federal petit or grand

juror.

(i) Employer or Agency means any civil agency or instrumentality of

the United States Government, or any other organization, group or

institution employing an individual defined as an ``employee'' by this

section. These terms also refer to officers and employees of an

employer having responsibility for the supervision, direction or

control of employees of that employer as an ``immediate superior,'' and

to other employees designated by the employer to carry out the

functions vested in the employer under the FECA and this part,

including officers or employees delegated responsibility by an employer

for authorizing medical treatment for injured employees.

(j) Entitlement means entitlement to benefits as determined by OWCP

under the FECA and the procedures described in this part.

[[Page 67139]]

(k) FECA means the Federal Employees' Compensation Act, as amended.

(l) Hospital services means services and supplies provided by

hospitals within the scope of their practice as defined by State law.

(m) Impairment means any anatomic or functional abnormality or

loss. A permanent impairment is any such abnormality or loss after

maximum medical improvement has been achieved.

(n) Knowingly means with knowledge, consciously, willfully or

intentionally.

(o) Medical services means services and supplies provided by or

under the supervision of a physician. Reimbursable chiropractic

services are limited to physical examinations (and related laboratory

tests), x-rays performed to diagnose a subluxation of the spine and

treatment consisting of manual manipulation of the spine to correct a

subluxation.

(p) Medical support services means services, drugs, supplies and

appliances provided by a person other than a physician or hospital.

(q) Occupational disease or illness means a condition produced by

the work environment over a period longer than a single workday or

shift.

(r) OWCP means the Office of Workers' Compensation Programs.

(s) Pay rate for compensation purposes means the employee's pay, as

determined under 5 U.S.C. 8114, at the time of injury, the time

disability begins or the time compensable disability recurs if the

recurrence begins more than six months after the injured employee

resumes regular full-time employment with the United States, whichever

is greater, except as otherwise determined under 5 U.S.C. 8113 with

respect to any period.

(t) Physician means an individual defined as such in 5 U.S.C.

8101(2), except during the period for which his or her license to

practice medicine has been suspended or revoked by a State licensing or

regulatory authority.

(u) Qualified hospital means any hospital licensed as such under

State law which has not been excluded under the provisions of subpart I

of this part. Except as otherwise provided by regulation, a qualified

hospital shall be deemed to be designated or approved by OWCP.

(v) Qualified physician means any physician who has not been

excluded under the provisions of subpart I of this part. Except as

otherwise provided by regulation, a qualified physician shall be deemed

to be designated or approved by OWCP.

(w) Qualified provider of medical support services or supplies

means any person, other than a physician or a hospital, who provides

services, drugs, supplies and appliances for which OWCP makes payment,

who possesses any applicable licenses required under State law and who

has not been excluded under the provisions of subpart I of this part.

(x) Recurrence of disability means an inability to work after an

employee has returned to work, caused by a spontaneous and material

change in a medical condition which had resulted from a previous injury

or illness without an intervening injury or new exposure to the work

environment that caused the illness. This term also means an inability

to work that takes place when a light-duty assignment made specifically

to accommodate an employee's physical restrictions due to his or her

work-related injury or illness is withdrawn (except when such

withdrawal occurs for reasons of misconduct, non-performance of job

duties or a reduction-in-force), or when the physical requirements of

such an assignment are altered so that they exceed his or her

established physical restrictions.

(y) Representative means an individual properly authorized by a

claimant in writing to act for the claimant in connection with a claim

or proceeding under the FECA or this part.

(z) Student means an individual defined at 5 U.S.C. 8101(17). Two

terms used in that particular definition are further defined as

follows:

(1) ``Additional type of educational or training institution''

means a technical, trade, vocational, business or professional school

accredited or licensed by the United States Government or a state

government or any political subdivision thereof providing courses of

not less than three months' duration, that prepares the individual for

a livelihood in a trade, industry, vocation or profession.

(2) ``Year beyond the high school level'' means:

(i) The 12-month period beginning the month after the individual

graduates from high school, provided he or she had indicated an

intention to continue schooling within four months of high school

graduation, and each successive 12-month period in which there is

school attendance or the payment of compensation based on student

attendance; or

(ii) If the individual has indicated that he or she will not

continue schooling within four months of high school graduation, the

12-month period beginning with the month that the individual enters

school to continue his or her education, and each successive 12-month

period in which there is school attendance or the payment of

compensation based on student status.

(aa) Subluxation means an incomplete dislocation, off-centering,

misalignment, fixation or abnormal spacing of the vertebrae which must

be demonstrable on any x-ray film to an individual trained in the

reading of x-rays.

(bb) Surviving spouse means the husband or wife living with or

dependent for support upon a deceased employee at the time of his or

her death, or living apart for reasonable cause or because of the

deceased employee's desertion.

(cc) Temporary aggravation of a pre-existing condition means that

factors of employment have directly caused that condition to be more

severe for a limited period of time and have left no greater impairment

than existed prior to the employment injury.

(dd) Traumatic injury means a condition of the body caused by a

specific event or incident or series of events or incidents within a

single workday or shift. Such condition must be caused by external

force, including stress or strain, which is identifiable as to time and

place of occurrence and member or function of the body affected.

Sec. 10.6 What special statutory definitions apply to dependents and

survivors?

(a) 5 U.S.C. 8133 provides that certain benefits are payable to

certain enumerated survivors of employees who have died from an injury

sustained in the performance of duty.

(b) 5 U.S.C. 8148 also provides that certain other benefits are

payable to certain family members of employees who have been

incarcerated due to a felony conviction.

(c) 5 U.S.C. 8110(b) further provides that any employee who is

found to be eligible for a basic benefit shall be entitled to have such

basic benefit augmented at a specified rate for certain persons who

live in the beneficiary's household or who are dependent upon the

beneficiary for support.

(d) 5 U.S.C. 8101, 8110, 8133 and 8148, which define the nature of

such survivorship or dependency necessary to qualify a beneficiary for

a survivor's benefit or an augmented benefit, apply to the provisions

of this part.

Sec. 10.7 What forms are needed to process claims under the FECA?

(a) Notice of injury, claims and certain specified reports shall be

made on forms prescribed by OWCP. Employers are expected to maintain an

adequate

[[Page 67140]]

supply of the basic forms needed for the proper recording and reporting

of injuries.

------------------------------------------------------------------------

Form No. Title

------------------------------------------------------------------------

(1) CA-1................. Federal Employee's Notice of Traumatic Injury

and Claim for Continuation of Pay/

Compensation.

(2) CA-2................. Notice of Occupational Disease and Claim for

Compensation.

(3) CA-2a................ Notice of Employee's Recurrence of Disability

and Claim for Pay/Compensation.

(4) CA-3................. Report of Termination of Disability and/or

Payment.

(5) CA-5................. Claim for Compensation by Widow, Widower and/

or Children.

(6) CA-5b................ Claim for Compensation by Parents, Brothers,

Sisters, Grandparents, or Grandchildren.

(7) CA-6................. Official Superior's Report of Employee's

Death.

(8) CA-7................. Claim for Compensation Due to Traumatic

Injury or Occupational Disease.

(9) CA-8................. Claim for Continuing Compensation on Account

of Disability.

(10) CA-12............... Claim for Continuance of Compensation.

(11) CA-16............... Authorization of Examination and/or

Treatment.

(12) CA-17............... Duty Status Report.

(13) CA-20............... Attending Physician's Report.

(14) CA-20a.............. Attending Physician's Supplemental Report.

------------------------------------------------------------------------

(b) Copies of the forms listed in this paragraph are available for

public inspection at the Office of Workers' Compensation Programs,

Employment Standards Administration, U.S. Department of Labor,

Washington, DC 20210. They may also be obtained from district offices,

employers (i.e., safety and health offices, supervisors), and the

Internet.

Information in Program Records

Sec. 10.10 Are all documents relating to claims filed under the FECA

considered confidential?

All records relating to claims for benefits, including copies of

such records maintained by an employer, are considered confidential and

may not be released, inspected, copied or otherwise disclosed except as

provided in the Freedom of Information Act and the Privacy Act of 1974.

All FECA-related records are covered by the government-wide Privacy Act

system of records entitled DOL/GOVT-1 (Office of Workers' Compensation

Programs, Federal Employees' Compensation Act File). The routine uses

to which such records may be put are set forth in the Notice published

in the Federal Register by the Department of Labor. The regulations and

routine uses promulgated by the Department of Labor control decisions

regarding access to all FECA-related records.

Sec. 10.11 Who maintains custody and control of FECA records?

All documents covered by DOL/GOVT-1 are official records of OWCP

and, as such, are maintained by and under the control of OWCP. While an

employer may establish procedures an injured employee or FECA

beneficiary should follow in requesting access to documents it

maintains, any decision issued in response to such a request must

comply with the rules and regulations of the Department of Labor.

Sec. 10.12 How may a FECA claimant or beneficiary obtain copies of

protected records?

(a) A claimant seeking copies of his or her official FECA file

should address a request to the District Director of the OWCP office

having custody of the file. A claimant seeking copies of FECA-related

documents in the custody of the employer should follow the procedures

established by that agency. In responding to a claimant's request, the

employer must comply with the rules and regulations of the Department

of Labor which govern all aspects of safeguarding the records.

(b) Any appeal from a decision denying access to the FECA-related

documents must be filed with the Solicitor of Labor as provided in 29

CFR part 71.

Sec. 10.13 What process is used by a person who wants to correct FECA-

related documents?

Any request to amend a record covered by DOL/GOVT-1 should be

directed to the district office having custody of the official file. No

employer has the authority to issue determinations with regard to

requests for the correction of records contained in or covered by DOL/

GOVT-1. Any request for correction received by an employer must be

referred to OWCP for review and decision.

Rights and Penalties

Sec. 10.15 May compensation rights be waived?

No employer or other person may require an employee or other

claimant to enter into any agreement, either before or after an injury

or death, to waive his or her right to claim compensation under the

FECA. No waiver of compensation rights shall be valid.

Sec. 10.16 What are the criminal law penalties for making a false

report in connection with a claim under the FECA?

(a) A number of statutory provisions make it a crime to file a

false or fraudulent claim or statement with the government in

connection with a claim under the FECA. Included among these provisions

are sections 287, 1001, 1920, and 1922 of title 18, United States Code.

Enforcement of these and other criminal provisions that may apply to

claims under the FECA are within the jurisdiction of the Department of

Justice.

(b) In addition, administrative proceedings may be initiated under

the Program Fraud Civil Remedies Act of 1986 (PFCRA), 31 U.S.C. 3801-

12, to impose civil penalties and assessments against persons who make,

submit, or present, or cause to be made, submitted or presented, false,

fictitious or fraudulent claims or written statements to OWCP in

connection with a claim under the FECA. The Department of Labor's

regulations implementing the PFRCA are found at 29 CFR part 22.

Sec. 10.17 Is a beneficiary who defrauds the government in connection

with a claim for benefits still entitled to those benefits?

When a beneficiary either pleads guilty to or is found guilty on

charges of defrauding the federal government in connection with a claim

for benefits, the beneficiary's entitlement to any further compensation

benefits will terminate effective the date either the guilty plea is

accepted or a verdict of guilty is returned after trial, for any injury

occurring on or before the date of such guilty plea or verdict.

Termination of entitlement under this section is not affected by any

subsequent change in or recurrence of the beneficiary's medical

condition.

[[Page 67141]]

Sec. 10.18 Can a beneficiary who is incarcerated based on a felony

conviction still receive benefits?

(a) Whenever a beneficiary is incarcerated in a state or federal

jail, prison, penal institution or other correctional facility due to a

state or federal felony conviction, he or she forfeits all rights to

compensation benefits during the period of incarceration. A

beneficiary's right to compensation benefits for the period of his or

her incarceration is not restored after such incarceration ends, even

though payment of compensation benefits may resume.

(b) If the beneficiary has eligible dependents, OWCP will pay

compensation to such dependents at a reduced rate during the period of

his or her incarceration, by applying the percentages of 5 U.S.C.

8133(a)(1) through (5) to the beneficiary's gross current entitlement.

(c) If OWCP's decision on entitlement is pending when the period of

incarceration begins, and compensation is due for a period of time

prior to such incarceration, payment for that period will only be made

to the beneficiary following his or her release.

Subpart B--Filing Notices and Claims; Submitting Evidence

Notices and Claims for Injury, Disease, and Death--Employee or

Survivor's Actions

Sec. 10.100 How and when is a notice of traumatic injury filed?

(a) To claim benefits under the FECA, an employee who sustains a

work-related traumatic injury must give notice of the injury in writing

on Form CA-1, which may be obtained from the employer. The employee

must forward this notice to the employer. Another person, including the

employer, may give notice of injury on the employee's behalf. The

person submitting a notice shall include the Social Security Number

(SSN) of the injured employee.

(b) For injuries sustained on or after September 7, 1974, a notice

of injury must be filed within three years of the injury. (The form

contains the necessary words of claim.) The requirements for filing

notice are further described in 5 U.S.C. 8119. Also see Sec. 10.205

concerning time requirements for filing claims for continuation of pay.

(1) If the claim is not filed within three years, compensation may

still be allowed if notice of injury was given within 30 days or the

employer had actual knowledge of the injury or death within 30 days

after occurrence. This knowledge may consist of written records or

verbal notification. An entry into an employee's medical record may

also satisfy this requirement if it is sufficient to place the employer

on notice of a possible work-related injury or disease.

(2) OWCP may excuse failure to comply with the three-year time

requirement because of truly exceptional circumstances (for example,

being held prisoner of war).

(3) The claimant may withdraw his or her claim (but not the notice

of injury) by so requesting in writing to OWCP at any time before OWCP

determines eligibility for benefits.

Sec. 10.101 How and when is a claim for wage loss compensation on

account of traumatic injury filed?

(a) Form CA-7 is used to claim compensation for initial periods of

disability.

(1) An employee who is disabled with loss of pay for more than

three calendar days due to an injury, or someone acting on his or her

behalf, must file Form CA-7 before compensation can be paid.

(2) The employee shall complete the front of Form CA-7 and submit

the form to the employer for completion and transmission to OWCP. The

form should be completed as soon as possible, but no more than 14

calendar days after the date pay stops due to the injury or disease.

(3) The requirements for filing claims are further described in 5

U.S.C. 8121.

(b) Form CA-8 is used to claim compensation for additional periods

of disability after Form CA-7 is submitted to OWCP.

(1) It is the employee's responsibility to submit Form CA-8.

Without receipt of such claim, OWCP has no knowledge of continuing wage

loss. Therefore, while disability continues, the employee should submit

a claim on Form CA-8 each two weeks until otherwise instructed by OWCP.

(2) The employee shall complete the front of Form CA-8 and submit

the form to the employer for completion and transmission to OWCP.

(3) The employee is responsible for submitting, or arranging for

the submittal of, medical evidence which establishes both that

disability continues and that the disability is due to the work-related

injury. Form CA-20a is attached to Form CA-8 for this purpose.

Sec. 10.102 How and when is a notice of occupational disease filed?

(a) To claim benefits under the FECA, an employee who has a disease

which he or she believes to be work-related must give notice of the

condition in writing on Form CA-2, which may be obtained from the

employer. The employee must forward this notice to the employer.

Another person, including the employer, may do so on the employee's

behalf. The person submitting a notice shall include the Social

Security Number (SSN) of the injured employee. The claimant may

withdraw his or her claim (but not the Notice of Injury) by so

requesting in writing to OWCP at any time before OWCP determines

eligibility for benefits.

(b) For occupational diseases sustained as a result of exposure to

injurious work factors that occurs on or after September 7, 1974, a

notice of occupational disease must be filed within three years of the

onset of the condition. (The form contains the necessary words of

claim.) The requirements for timely filing are described in

Sec. 10.100(b)(1) through (3).

(c) However, in cases of latent disability, the time for filing

claim does not begin to run until the employee has a compensable

disability and is aware, or reasonably should have been aware, of the

causal relationship between the disability and the employment (see 5

U.S.C. 8122(b)).

Sec. 10.103 How and when is a claim for wage loss compensation on

account of occupational disease filed?

Compensation for the initial period of disability, additional

periods of disability, and impairment of a body part is claimed as

described in Secs. 10.101 and 10.104.

Sec. 10.104 How and when is a claim for permanent impairment filed?

Form CA-7 is used to claim compensation for impairment to a body

part covered under the schedule established by 5 U.S.C. 8107. If Form

CA-7 has already been filed to claim disability compensation, an

employee may file a claim for impairment compensated according to the

schedule by sending a letter to OWCP which specifies the nature of the

benefit claimed.

Sec. 10.105 How and when is a claim for recurrence filed?

(a) A recurrence should be reported on Form CA-2a if it causes the

employee to lose time from work and incur a wage loss. However, a

notice of recurrence should not be filed for time loss due to traumatic

injury during the period covered by continuation of pay. Also, a notice

of recurrence should not be filed when a new injury or event

contributing to an occupational disease has occurred. In these

instances, the employee should file Form CA-1 or CA-2.

[[Page 67142]]

(b) The employee has the burden of establishing by the weight of

reliable, probative and substantial evidence that the recurrence of

disability is causally related to the original injury.

(1) The employee must include a statement with Form CA-2a

describing his or her duties upon return to work after the original

injury, stating whether there were any other injuries or illness, and

giving a general description of his or her physical condition during

the intervening period. The employer may submit comments concerning the

employee's statement.

(2) The employee should arrange for the submittal of a detailed

medical report from the attending physician as described on Form CA-2a.

The employee should also submit, or arrange for the submittal of,

similar medical reports for any examination and/or treatment received

after returning to work following the original injury.

Sec. 10.106 How and when is a notice of death and claim for benefits

filed?

(a) If an employee dies from a work-related traumatic injury or an

occupational disease, any survivor may file a claim for death benefits

using Form CA-5 or CA-5b, which may be obtained from the employer. The

survivor must provide this notice in writing and forward it to the

employer. Another person, including the employer, may do so on the

survivor's behalf. The claimant may also submit the completed Form CA-5

or CA-5b directly to OWCP. The claimant shall disclose the SSNs of the

survivors in addition to the SSN of the deceased employee. The claimant

may withdraw his or her claim (but not the notice of death) by so

requesting in writing to OWCP at any time before OWCP determines

eligibility for benefits.

(b) For deaths that occur on or after September 7, 1974, a notice

of death must be filed within three years of the death. The form

contains the necessary words of claim. The requirements for timely

filing are described in Sec. 10.100(b) (1) through (3).

(c) However, in cases of death due to latent disability, the time

for filing the claim does not begin to run until the claimant is aware,

or reasonably should have been aware, of the causal relationship

between the death and the employment (see 5 U.S.C. 8122(b)).

(d) The filing of a notice of injury will satisfy the time

requirements for a death claim based on the same injury. If an injured

employee or someone acting on the employee's behalf does not file a

claim before the employee's death, the right to claim compensation for

disability other than medical expenses ceases and does not survive.

(e) A survivor must be alive to receive any payment; there is no

vested right to such payment. A report as described in Sec. 10.414 of

this part must be filed onc

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