[Federal Register Volume 62, Number 14 (Wednesday, January 22, 1997)]
[Proposed Rules]
[Pages 3338-3435]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-44]



[[Page 3337]]

_______________________________________________________________________

Part II





Department of Labor





_______________________________________________________________________



Employment Standards Administration



_______________________________________________________________________



20 CFR Parts 718, et al.



Regulations Implementing the Federal Coal Mine Health and Safety Act of 
1969, as Amended; Proposed Rule

Federal Register / Vol. 62, No. 14 / Wednesday, January 22, 1997 / 
Proposed Rules

[[Page 3338]]



DEPARTMENT OF LABOR

Employment Standards Administration

20 CFR Parts 718, 722, 725, 726 and 727

RIN 1215-AA99


Regulations implementing the Federal Coal Mine Health and Safety 
Act of 1969, as Amended

AGENCY: Employment Standards Administration, Labor.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Labor proposes to amend the regulations 
implementing the Black Lung Benefits Act. Most of the affected 
regulations govern the processing and adjudication of individual claims 
filed by former coal miners and their surviving dependents, including 
the medical criteria used to adjudicate the entitlement of those who 
file claims and the criteria used to determine which of the miner's 
former employers will be liable for the payment of benefits. In 
addition, the Department proposes to eliminate outdated regulations 
setting forth criteria for approving state workers' compensation 
programs; to discontinue the annual publication, in the Code of Federal 
Regulations, of the interim criteria governing claims filed prior to 
April 1, 1980; and to revise the criteria governing the responsibility 
of coal mine operators to secure the payment of benefits to their 
employees.

DATES: Comments must be submitted on or before March 24, 1997.

ADDRESSES: All comments concerning these proposed regulations should be 
addressed to James L. DeMarce, Director, Division of Coal Mine Workers' 
Compensation, Room C-3520, Frances Perkins Building, 200 Constitution 
Ave., N.W., Washington, DC 20210.

FOR FURTHER INFORMATION CONTACT: James L. DeMarce, (202) 219-6692.

SUPPLEMENTARY INFORMATION: The Department last amended the regulations 
implementing the Black Lung Benefits Act, 30 U.S.C. 901 et seq., in 
1983, more than thirteen years ago. Since then, litigation before the 
various U.S. courts of appeals and the Benefits Review Board has 
resulted in the clarification of many substantive areas. Moreover, the 
Office of Workers' Compensation Programs' experience in administering 
the program during this period has resulted in a variety of suggestions 
for change with the goal of helping to improve services, streamline the 
adjudication process and simplify the regulations' language. Thus, the 
Department proposes numerous changes in order to streamline, update and 
clarify these program regulations.

Summary of Noteworthy Proposed Changes

Evidentiary Development

    The proposed regulations contain a limitation on the amount of 
documentary medical evidence parties may submit. The designated 
responsible coal mine operator or the Director, whichever party is 
liable, and the claimant are limited in their affirmative presentations 
to two complete pulmonary evaluations or consultative reports a piece. 
Documentary rebuttal evidence is limited to one interpretive opinion 
with respect to each part of the pulmonary evaluation submitted by a 
party's opponent. See proposed Sec. 725.414.
    The Department proposes these changes in order to ensure that 
eligibility determinations are based on the best quality evidence 
submitted rather than on the quantity of evidence submitted by each 
side. Currently, in establishing their eligibility to benefits, 
claimants must confront the vastly superior economic resources of their 
adversaries: coal mine operators and their insurance carriers. Often, 
these parties generate medical evidence in such volume that it 
overwhelms the evidence supporting entitlement that claimants can 
procure. The proposed changes limiting evidentiary development attempt 
to make more equitable the adjudication of black lung claims and reduce 
the costs associated with these cases.
    The proposed regulation also fundamentally restructures the claims 
adjudication process by focusing evidentiary development at the 
district director level. The regulation requires all parties to develop 
their documentary medical evidence and submit it to the district 
director for consideration. Once a claim is referred for a hearing 
before the Office of Administrative Law Judges, additional documentary 
medical evidence will be admitted into the record only on a showing of 
extraordinary circumstances or if the claimant has not been provided 
with an adequate complete pulmonary evaluation by doctors of the 
Department's choosing. The administrative law judge who conducts the 
hearing may permit the parties to elicit testimony only from a limited 
group of witnesses, including any physician whose report was submitted 
to the district director. The judge will base his decision on a de novo 
review of the evidentiary record developed by the district director and 
the hearing testimony. See proposed Secs. 725.414, 725.456 and 725.457.
    This proposed procedure departs from current practice by excluding 
the admission of most additional documentary evidence while a claim is 
pending before an administrative law judge. Parties presently often 
reserve the active development of medical evidence until a claim is 
referred for hearing. Permitting additional evidentiary development 
before the administrative law judge was logical when significant delays 
occurred between the district director's decision and the hearing 
before the administrative law judge. Such delays no longer occur in a 
statistically significant percentage of claims. Consequently, the 
practical need for permitting evidentiary development at the hearing 
stage has disappeared.
    The Department believes that these proposed procedural changes 
requiring evidentiary development before the district director will 
encourage prompt and complete evidentiary development at the earliest 
stages and will therefore allow the Department to conduct a thorough 
and meaningful initial adjudication of each claim. The Department 
believes that the fair, efficient and expeditious adjudication of 
claims is a desirable objective which can be promoted by limiting the 
amount of medical evidence developed and encouraging all parties to 
participate actively at the earliest stages of the process.

Identification of Responsible Operators

    The proposed regulations provide that a district director may name 
one or more ``potentially liable operators'' from among a miner's 
former employers. The potentially liable operator that most recently 
employed the claimant will generally be the responsible operator liable 
for the payment of benefits. The proposed regulations afford the 
district director considerable flexibility, however, in notifying 
potentially liable operators; they may be notified seriatim after the 
district director evaluates the response from the miner's most recent 
employer or does not receive any response. If a potentially liable 
operator contests its identification, it must submit documentary 
evidence supporting its position to the district director. In cases 
involving difficult responsible operator identification issues, the 
district director may retain more than one potentially liable operator 
as a party to the case. See proposed Secs. 725.407 and 725.408.
    The district director will choose a responsible operator from among 
the

[[Page 3339]]

identified potentially liable operators and will notify the parties of 
this determination in his initial findings. The designated responsible 
operator must respond to the notice of initial findings within 30 days 
and must specifically indicate whether it agrees or disagrees with the 
initial finding of liability. See proposed Secs. 725.410, 725.412. In 
the event further adjudication of the claim is required, the district 
director may retain as parties to the case other potentially liable 
operators in order to preserve the Department's right to compel the 
payment of benefits by the responsible operator ultimately determined 
to be liable for the claimant's benefits. See proposed Sec. 725.413.
    To ensure that the claimant is not overwhelmed by operator-
developed medical evidence, however, the proposed regulations limit all 
potentially liable operators and the designated responsible operator to 
a total of two pulmonary evaluations or consultative reports as an 
affirmative case. Because all of the named operators have an identical 
interest with respect to the claimant's eligibility, the Department 
does not believe that unfairness will result from limiting the total 
evidence submitted. The designated responsible operator will have the 
responsibility and, indeed, the obligation, to develop the operators' 
case in chief on behalf of all named operators. Any named operator, 
other than the responsible operator, must request the district 
director's permission in order to schedule the claimant for a medical 
examination. This permission may be granted only upon a showing that 
the responsible operator has not undertaken a full development of the 
evidence. In no event will the claimant be required to undergo more 
than two pulmonary examinations by the parties opposing his 
eligibility. See proposed Sec. 725.414.
    The proposed responsible operator regulations also assign both the 
Office of Workers' Compensation Programs (OWCP) and the designated 
responsible operator burdens of proof. Under proposed Sec. 725.495, the 
Department bears the burden of proof to identify the responsible 
operator initially found liable for the payment of benefits. In order 
to carry this burden of proof, OWCP must establish that the responsible 
operator is a ``potentially liable operator,'' i.e., that it was an 
operator after June 30, 1973, that it employed the miner for at least 
one year, that at least one day of that employment occurred after 
December 31, 1969, and that the miner was exposed to coal mine dust 
while working for the operator. In addition, in any case in which the 
designated responsible operator is not the miner's most recent 
employer, the record must include a statement that OWCP has 
investigated its files and has determined that it has no record that a 
more recent employer insured its liability under the Act, or was 
authorized to self-insure such liability.
    Once OWCP has met its burden of proof, the burden shifts to the 
designated responsible operator. The operator may avoid liability for 
the claim only if it establishes: (1) that it is not financially 
capable of assuming liability for the claim; or (2) that one of the 
miner's more recent employers meets all of the criteria for a 
potentially liable operator. The burden imposed on the designated 
responsible operator under this second alternative includes a showing 
that the more recent employer is financially capable of assuming 
liability. See proposed Sec. 725.495.
    If the designated responsible operator carries its burden of proof 
and establishes that it was incorrectly identified and OWCP has failed 
to name and retain as a party the coal mine operator ultimately found 
liable as the responsible operator, the Trust Fund will bear liability 
for the claim. In such a case, OWCP will make no attempt to name a new 
responsible operator and force the claimant once again to establish his 
entitlement to benefits. See proposed Sec. 725.407(d) allowing the 
district director to identify and notify a responsible operator only 
before a case is referred to the Office of Administrative Law Judges.

Civil Money Penalty

    The proposed regulations contain new provisions implementing the 
Act's civil money penalty provision, which directs the assessment of a 
penalty of up to $1,000 per day against operators that fail to secure 
the payment of benefits, either by purchasing commercial insurance or 
qualifying as a self-insurer. 30 U.S.C. 933(d). The proposed 
regulations establish criteria and streamlined procedures to be used in 
assessing penalties. They provide notice of the Department's intention 
to minimize the financial burden that uninsured operators currently 
place on those operators in compliance with the Act's security 
requirements and on the Black Lung Disability Trust Fund. See proposed 
20 CFR part 726, subpart D, Secs. 726.300-726.320.
    The proposed regulations provide a graduated series of possible 
penalties based on a set of criteria, including the operator's size, 
its prior notice of the Act's insurance requirements and the operator's 
action, or inaction, following this notification. See proposed 
Sec. 726.302. After receipt of a notice of penalty assessment and entry 
of a timely notice of contest, an operator may request a hearing before 
the Office of Administrative Law Judges. See proposed Sec. 726.307. The 
ensuing decision will address whether the operator has violated the 
Act's insurance requirements, whether the individuals identified by the 
Director as potentially severally liable for the penalty were in fact 
the president, treasurer or secretary of the corporation during the 
relevant time period and, finally, the appropriateness of the penalty 
assessment. See proposed Sec. 726.313. The Director or any party 
aggrieved by a decision of the administrative law judge may petition 
the Secretary for review, which will be conducted using a substantial 
evidence standard. See proposed Secs. 726.314, 726.318.
    The proposed regulations also impose an additional requirement on 
self-insured operators. They require that such operators continue to 
secure the payment of benefits to their employees even after the 
operator has ceased mining coal. This additional requirement is 
necessary given the limited amount of security typically required of 
operators who self-insure and the prolonged time periods after coal 
mine employment has ceased during which miners may file claims for 
benefits. See proposed Sec. 726.114(c).

Treating Physicians' Opinions

    The Department proposes a new paragraph (d) of 20 CFR 718.104, the 
regulation governing reports of physical examinations. The proposed 
paragraph would give certain treating physicians' opinions controlling 
weight in determining whether the miner is totally disabled or died due 
to pneumoconiosis. The proposed language would mandate that, when 
weighing a treating physician's opinion, the factfinder must consider 
the nature and duration of the relationship between the miner and the 
physician, the frequency and extent of the physician's treatment, and 
the credibility of the doctor's opinion in light of his reasoning and 
documentation. The factfinder must also consider the opinion's 
consistency with the other relevant evidence, and the doctor's training 
and specialization.

Waiver of Overpayments

    The Department proposes amending Sec. 725.547(a), which addresses 
the applicability of overpayment provisions to coal mine operators and 
their

[[Page 3340]]

insurance carriers. The proposed regulation would make available to all 
overpaid claimants the provisions governing waiver of recovery of an 
overpayment incorporated from the Social Security Act, 30 U.S.C. 
923(b), 940, incorporating 42 U.S.C. 404(b).
    Currently, only a claimant who receives an overpayment from the 
Black Lung Disability Trust Fund may be relieved of his repayment 
obligation. Such a claimant is entitled to waiver of recovery of the 
overpayment if he can demonstrate that permitting recovery would 
``defeat the purpose of the Act'' or ``be against equity and good 
conscience.'' Only those individuals who were not ``at fault'' in 
creating the overpayment are eligible for waiver. The Department has 
concluded that these waiver provisions should be available to all 
claimants, including those who are overpaid by operators and insurance 
carriers. Thus, under the proposed language, any individual who has 
received an overpayment will have the opportunity to establish that the 
two-part test for waiver is met.

Establishing Total Disability and Total Disability Due to 
Pneumoconiosis

    Proposed Sec. 718.204 amends the definition of ``total disability'' 
and makes explicit the Department's position with regard to 
establishing total disability due to pneumoconiosis. Both of these 
changes reflect the decisions of numerous courts of appeals. In order 
to be found ``totally disabled,'' a miner must have a respiratory or 
pulmonary impairment which, standing alone, prevents him from 
performing his usual coal mine employment. See proposed 
Sec. 718.204(b). In order to establish entitlement, the miner must also 
demonstrate that his total disability is due to pneumoconiosis. This 
showing is made by establishing that pneumoconiosis is a substantially 
contributing cause of the totally disabling respiratory or pulmonary 
impairment. See proposed Sec. 718.204(c). Finally, proposed 
Sec. 718.204(a) also makes clear that a concurrent disability due to a 
nonrespiratory or nonpulmonary condition will not disqualify the miner 
from receipt of black lung benefits if the miner can also demonstrate 
total disability due to pneumoconiosis.

Additional or Subsequent Claims

    The proposed regulations clarify claimants' right to file 
``additional'' or ``subsequent'' claims, those claims filed more than 
one year after denial of a previous claim. See proposed 
Sec. 725.309(d). Under this proposal, the claimant may escape automatic 
denial of an additional claim on the grounds of the prior denial, by 
demonstrating that a change in one of the applicable conditions of 
entitlement has occurred since the date upon which the order denying 
the prior claim became final. The changed regulatory language codifies 
the holdings of several courts of appeals.
    The applicable conditions of entitlement are limited to those 
conditions upon which the prior denial was based. If the applicable 
conditions of entitlement relate to the miner's physical condition and 
the new evidence submitted with the additional claim establishes a 
change in at least one applicable condition, the proposed regulation 
contains a rebuttable presumption that the miner's physical condition 
has changed. Once a change in an applicable condition of entitlement is 
established, none of the findings made in connection with the prior 
claim, except those based on a party's failure to contest an issue, 
shall be binding in the adjudication of the subsequent claim, and the 
claim must be adjudicated on the merits.

Medical Benefits

    Proposed Sec. 725.701(e) provides that in any claim for 
compensation for treatment of a pulmonary disorder filed by a miner 
entitled to medical benefits, there shall be a rebuttable presumption 
that the treatment was for a disorder caused or aggravated by 
pneumoconiosis. This amended regulatory language codifies a decision of 
the United States Court of Appeals for the Fourth Circuit. The 
presumption may be rebutted only by evidence that the specific 
pulmonary disorder being treated is neither related to, nor aggravated 
by, the miner's pneumoconiosis. The proposed regulation also provides 
that evidence that the miner does not have pneumoconiosis or is not 
totally disabled by pneumoconiosis arising out of coal mine employment, 
i.e., evidence which challenges the miner's underlying entitlement to 
medical benefits, is insufficient to demonstrate that the specific 
treatment for which compensation is claimed is not compensable. See 
proposed Sec. 725.701(f).

Explanation of Proposed Changes

    The Department proposes to revise the regulations implementing the 
Black Lung Benefits Act, set forth at Chapter VI of Title 20 of the 
Code of Federal Regulations. In order to make all the proposed changes 
more easily understandable, the Department proposes to re-promulgate 
Parts 718, 722, 725, and 726 in their entirety. This action is intended 
to aid the readers of the Federal Register, and should not be construed 
as inviting comments on any regulation which has not been substantively 
revised. The regulations within these parts may be divided into three 
categories: (1) those which will be substantively revised; (2) those to 
which the Department is proposing only technical changes; and (3) those 
which will not be revised at all.

Substantive revisions

    The following regulations are being substantively revised: 
Sec. 718.3, Sec. 718.101, Sec. 718.102, Sec. 718.103, Sec. 718.104, 
Sec. 718.105, Sec. 718.106, Sec. 718.107, Sec. 718.201, Sec. 718.202, 
Sec. 718.204, Sec. 718.205, Sec. 718.301, Sec. 718.307, Sec. 718.401, 
Sec. 718.402, Sec. 718.403, Sec. 718.404, Appendix B to part 718, 
Appendix C to Part 718, part 722 (entire), Sec. 725.1, Sec. 725.2, 
Sec. 725.4, Sec. 725.101, Sec. 725.103, Sec. 725.202, Sec. 725.203, 
Sec. 725.204, Sec. 725.209, Sec. 725.212, Sec. 725.213, Sec. 725.214, 
Sec. 725.215, Sec. 725.219, Sec. 725.221, Sec. 725.222, Sec. 725.223, 
Sec. 725.306, Sec. 725.309, Sec. 725.310, Sec. 725.311, Sec. 725.362, 
Sec. 725.367, Sec. 725.405, Sec. 725.406, Sec. 725.407, Sec. 725.408, 
Sec. 725.409, Sec. 725.410, Sec. 725.411, Sec. 725.412, Sec. 725.413, 
Sec. 725.414, Sec. 725.415, Sec. 725.416, Sec. 725.417, Sec. 725.418, 
Sec. 725.421, Sec. 725.423, Sec. 725.452, Sec. 725.454, Sec. 725.456, 
Sec. 725.457, Sec. 725.458, Sec. 725.459, Sec. 725.478, Sec. 725.479, 
Sec. 725.490, Sec. 725.491, Sec. 725.492, Sec. 725.493, Sec. 725.494, 
Sec. 725.495, Sec. 725.502, Sec. 725.503, Sec. 725.522, Sec. 725.530, 
Sec. 725.537, Sec. 725.547, Sec. 725.606, Sec. 725.608, Sec. 725.609, 
Sec. 725.620, Sec. 725.621, Sec. 725.701, Sec. 725.706, Sec. 726.2, 
Sec. 726.8, Sec. 726.101, Sec. 726.104, Sec. 726.105, Sec. 726.106, 
Sec. 726.109, Sec. 726.110, Sec. 726.111, Sec. 726.114, Sec. 726.300, 
Sec. 726.301, Sec. 726.302, Sec. 726.303, Sec. 726.304, Sec. 726.305, 
Sec. 726.306, Sec. 726.307, Sec. 726.308, Sec. 726.309, Sec. 726.310, 
Sec. 726.311, Sec. 726.312, Sec. 726.313, Sec. 726.314, Sec. 726.315, 
Sec. 726.316, Sec. 726.317, Sec. 726.318, Sec. 726.319, Sec. 726.320, 
and part 727 (entire). The substantive revisions to these regulations 
are explained in further detail below.

Technical revisions

    In addition, a number of regulations have been revised to make 
certain technical changes. The proposed regulations substitute the term 
``district director'' for the term ``deputy commissioner'' wherever it 
appears. This change is explained in detail at 55 FR 28604-28607, July 
12, 1990. The proposed regulations also add a cross-reference to 
Sec. 725.4(d) to each regulation

[[Page 3341]]

which currently contains a cross-reference to part 727. Section 
725.4(d) explains that although the Department is discontinuing 
publication of the interim criteria set forth in 20 CFR Part 727 in the 
Code of Federal Regulations, part 727 remains applicable to all claims 
filed prior to April 1, 1980. In addition, certain proposed regulations 
have been revised and/or renumbered in order to conform with the 
current requirements of the Office of the Federal Register. The text of 
Sec. 725.453A has been incorporated into Sec. 725.454 as paragraphs 
(a), (b) and (c) and Sec. 725.454 has been retitled. The text of 
Sec. 725.459A has been incorporated into Sec. 725.455 as paragraph (d). 
Section 725.503A has been renumbered as Sec. 725.504, and 
Secs. 725.504-.506 have been renumbered Secs. 725.505-.507. Section 
725.701A has been renumbered Sec. 725.702, and Secs. 725.702-.707 have 
been renumbered Secs. 725.703-.708. Finally, the proposed regulations 
correct minor typographical errors, revise cross references to subparts 
of part 725 which have been redesignated and regulations that have been 
renumbered, and conform the regulations to the current practices of the 
Office of the Federal Register. The Department has included technical 
changes to the following regulations: Sec. 718.1, Sec. 718.2, 
Sec. 718.4, Sec. 718.303, Sec. 725.102, Sec. 725.216, Sec. 725.217, 
Sec. 725.301, Sec. 725.302, Sec. 725.350, Sec. 725.351, Sec. 725.360, 
Sec. 725.366, Sec. 725.401, Sec. 725.402, Sec. 725.403, Sec. 725.404, 
Sec. 725.419, Sec. 725.420, Sec. 725.450, Sec. 725.451, Sec. 725.453A, 
Sec. 725.455, Sec. 725.459A, Sec. 725.462, Sec. 725.463, Sec. 725.465, 
Sec. 725.466, Sec. 725.480, Sec. 725.496, Sec. 725.501, Sec. 725.503A, 
Sec. 725.504, Sec. 725.505, Sec. 725.506, Sec. 725.507, Sec. 725.510, 
Sec. 725.513, Sec. 725.514, Sec. 725.521, Sec. 725.532, Sec. 725.533, 
Sec. 725.543, Sec. 725.603, Sec. 725.604, Sec. 725.605, Sec. 725.607, 
Sec. 725.701A, Sec. 725.702, Sec. 725.703, Sec. 725.704, Sec. 725.705, 
Sec. 725.707, Sec. 725.708, Sec. 725.711, Sec. 726.4, and Sec. 726.203. 
Pursuant to the authority set forth in 5 U.S.C. 552(b)(3)(A), which 
allows federal agencies to alter ``rules of agency organization, 
procedure, or practice'' without notice and comment, the Department is 
not accepting comments on any of these regulations.

Unchanged Regulations

    Certain regulations are merely being repromulgated without 
alteration and are also not open for public comment. To the extent 
appropriate, the Department's previous explanations of these 
regulations, set forth in the Federal Register, see 43 FR 36772-36831, 
Aug. 18, 1978; 48 FR 24272-24294, May 31, 1983, remain applicable. The 
same is true of those regulations to which the Department is making 
only technical changes. The following regulations are being 
repromulgated for the convenience of readers: Sec. 718.203, 
Sec. 718.206, Sec. 718.302, Sec. 718.304, Sec. 718.305, Sec. 718.306, 
Appendix A to Part 718, Sec. 725.3, Sec. 725.201, Sec. 725.205, 
Sec. 725.206, Sec. 725.207, Sec. 725.208, Sec. 725.210, Sec. 725.211, 
Sec. 725.218, Sec. 725.220, Sec. 725.224, Sec. 725.225, Sec. 725.226, 
Sec. 725.227, Sec. 725.228, Sec. 725.229, Sec. 725.230, Sec. 725.231, 
Sec. 725.232, Sec. 725.233, Sec. 725.303, Sec. 725.304, Sec. 725.305, 
Sec. 725.307, Sec. 725.308, Sec. 725.352, Sec. 725.361, Sec. 725.363, 
Sec. 725.364, Sec. 725.365, Sec. 725.422, Sec. 725.453, Sec. 725.460, 
Sec. 725.461, Sec. 725.464, Sec. 725.475, Sec. 725.476, Sec. 725.477, 
Sec. 725.481, Sec. 725.482, Sec. 725.483, Sec. 725.497, Sec. 725.511, 
Sec. 725.512, Sec. 725.515, Sec. 725.520, Sec. 725.531, Sec. 725.534, 
Sec. 725.535, Sec. 725.536, Sec. 725.538, Sec. 725.539, Sec. 725.540, 
Sec. 725.541, Sec. 725.542, Sec. 725.544, Sec. 725.545, Sec. 725.546, 
Sec. 725.601, Sec. 725.602, Sec. 725.710, Sec. 726.1, Sec. 726.3, 
Sec. 726.5, Sec. 726.6, Sec. 726.7, Sec. 726.102, Sec. 726.103, 
Sec. 726.107, Sec. 726.108, Sec. 726.112, Sec. 726.113, Sec. 726.115, 
Sec. 726.201, Sec. 726.202, Sec. 726.204, Sec. 726.205, Sec. 726.206, 
Sec. 726.207, Sec. 726.208, Sec. 726.209, Sec. 726.210, Sec. 726.211, 
Sec. 726.212, and Sec. 726.213.
    For purposes of this preamble, ``he'', ``his'', and ``him'' shall 
include ``she'', ``hers'', and ``her''.

20 CFR Part 718--Standards for Determining Coal Miners' Total 
Disability or Death Due to Pneumoconiosis

Subpart A--General

    20 CFR 718.3. We are specifically seeking comment on Sec. 718.3. 
Paragraph (c) of Sec. 718.3 was used to support the ``true doubt'' 
rule, which provides that an evidentiary issue will be resolved in 
favor of the claimant if the probative evidence for and against the 
claimant is in equipoise. The United States Supreme Court invalidated 
the ``true doubt'' rule in Director, OWCP v. Greenwich Collieries, 114 
S.Ct. 2251 (1994). The Court concluded that paragraph (c) failed to 
define the ``true doubt'' rule effectively. It then held that the rule, 
as applied by the Benefits Review Board, contravenes the Administrative 
Procedure Act, 5 U.S.C. 551 et seq., by relieving the claimant of the 
APA-imposed burden of proving his claim by a preponderance of the 
evidence. Paragraph (c) also appeared to conflict with Sec. 718.403, 
which requires the party alleging any fact to bear the burden of 
proving that fact. Section 718.403 more accurately reflects the 
allocation of burdens of proof under the APA, and paragraph (c) of 
Sec. 718.3 should therefore be deleted.

Subpart B--Criteria for the Development of Medical Evidence

    20 CFR 718.101. The current text of Sec. 718.101 should be 
redesignated as paragraph (a), without further amendment, and a new 
paragraph (b) should be added. The Department has consistently 
maintained the position that the ``quality'' standards addressing the 
administration of certain clinical tests and examinations apply to all 
evidence developed by any party in connection with a claim for black 
lung benefits filed after March 31, 1980. The Benefits Review Board has 
rejected this position, and held that the standards govern only the 
evidence developed by the Department; for all other parties, the 
standards are advisory. The Board has also held that evidence cannot be 
rejected by the adjudicator solely for noncompliance with the relevant 
standard. See generally Gorzalka v. Big Horn Coal Co., 16 Black Lung 
Rep. (MB) 1-48, 1-51 (1990) and authorities cited. Only the Third 
Circuit has addressed this issue, and has agreed with the Department's 
position. Director, OWCP v. Mangifest, 826 F.2d 1318 (3d Cir. 1987). 
Although the existing regulations provide ample authority for making 
the quality standards generally applicable (see paragraphs 718.3(a), 
725.406(b), 725.456(c)), Sec. 718.101 should be amended to leave no 
doubt on this point.
    The Department has also consistently maintained that the part 718 
quality standards apply to part 727 claims if the test was conducted 
after March 31, 1980. See 20 CFR 727.203(c). The Sixth Circuit has 
accepted this interpretation of the regulations. Wiley v. Consolidation 
Coal Co., 915 F.2d 1076, 1080 (6th Cir. 1990). Both the Board and the 
Seventh Circuit, however, have rejected the Department's position. 
Coleman v. Ramey Coal Co., 18 Black Lung Rep. (MB) 1-9, 1-15 (1993); 
Peabody Coal Co. v. Director, OWCP [Brinkley], 972 F.2d 880, 882 (7th 
Cir. 1992). Accordingly, the proposed paragraph (b) includes a 
reference to part 727 claims to clarify the applicability of the 
quality standards to such claims.
    The individual quality standards address the compliance requirement 
in various ways. See 20 CFR 718.102 (x-ray) and 718.103 (pulmonary 
function study): substantial compliance; 718.104 (medical report) and 
718.105 (blood gas study): no reference; 718.106 (autopsy/biopsy): 
compliance. In order to clarify

[[Page 3342]]

the criterion for compliance and place it in logical sequence in the 
regulations, language should be added to Sec. 718.101 requiring 
``substantial compliance'' with all the standards. This regulation 
applies generally to all the quality standards, making it the rational 
provision to contain the compliance requirement. A single reference in 
one regulation also eliminates repetitive language from three other 
regulations while making explicit the applicability of the standard to 
the remaining two regulations. Finally, the phrase ``[e]xcept as 
otherwise provided'' recognizes the exemption from compliance for a 
deceased miner whose only X-ray is nonconforming, and autopsies or 
biopsies of miners who died before March 31, 1980.
    The purpose of the quality standards is to ensure the utilization 
of reliable evidence in adjudicating claims. The effect of 
noncompliance in terms of proving or refuting entitlement should 
therefore be obvious. In order to emphasize the insufficiency of such 
evidence as proof, however, proposed paragraph (b) contains an 
affirmative prohibition.
    20 CFR 718.102. Paragraph (e) should be reorganized in view of the 
proposed paragraph 718.101(b) general compliance standard. As noted 
with respect to proposed paragraph 718.101(b), codifying the 
``substantial compliance'' standard in that regulation of general 
applicability eliminates the need to reiterate it in each specific 
quality standard. The proposed paragraph (e) also makes Sec. 718.102 
consistent with Sec. 718.103 (pulmonary function studies) in presuming 
compliance with the technical criteria in the Appendix. Finally, the 
parenthetical citation to ``Sec. 718.208'' in the current regulation is 
a typographical error; no such provision exists. Reference to 
``Sec. 718.202'' is therefore substituted as a correction inasmuch as 
that regulation contains definitions of Board-eligible and -certified 
radiologists and ``B'' readers. See 20 CFR 718.202(a)(1)(ii) (C)-(E).
    20 CFR 718.103. The last two sentences of paragraph (a) should be 
removed, and the content of those sentences added to paragraph (c) to 
take into account the changes to Sec. 718.101. The explanation provided 
for eliminating the ``substantial compliance'' language in Sec. 718.102 
applies with equal force to Sec. 718.103. Furthermore, the proposed 
paragraphs 718.102(e) and 718.103(c) operate in a functionally 
equivalent manner: both regulations (i) presume compliance with 
technical requirements contained in the appendices; (ii) permit 
rebuttal of that presumption with ``contrary'' evidence; and (iii) 
recognize an exception to compliance for claims involving deceased 
miners and limited evidence. Given the identity of purpose in the 
current regulations, proposed paragraph 718.103(c) mirrors proposed 
paragraph 718.102(c) to ensure similar interpretation and operation.
    20 CFR 718.104. Section 718.104 should be amended to make clear 
that the enumerated data represents the minimum information and testing 
upon which a physician's report can be based if obtained in connection 
with a claim for benefits. This regulation also is the logical 
provision to implement guidelines for the weighing of medical reports 
from a miner's treating physician. Proposed paragraph (d) describes the 
relevant factors the adjudicator must consider in determining whether 
to accord ``controlling weight'' to the treating physician's opinion. 
The primary objective in changing the format of Sec. 718.104 is to 
clarify the requirement that any physician's report developed in 
connection with a claim must be based on certain enumerated information 
and data in order to establish or refute entitlement. Furthermore, the 
proposed regulation makes clear the necessity for utilizing at least an 
x-ray and a pulmonary function test which satisfy the quality standards 
as a clinical basis for a physician's pulmonary diagnosis. See 
Director, OWCP v. Siwiec, 894 F.2d 635, 639 (3d Cir. 1990) (holding 
that physician's report which was based on nonconforming pulmonary 
function study was insufficient to prove miner was disabled). Finally, 
proposed paragraph (c) parallels similar provisions in Secs. 718.102, 
718.103 and 718.106, which permit the utilization of nonconforming 
evidence to establish entitlement if the miner is deceased and 
complying evidence is unavailable. This provision adds the requirement 
that the physician must be unavailable; otherwise, in at least some 
instances, the physician could be requested to address, and cure, the 
deficiencies in his report.
    With respect to paragraph (d), judicial precedent has long 
recognized that special weight may be given the opinion of a miner's 
treating physician, based on the doctor's opportunity to observe the 
miner over a period of time. See, e.g., Thorn v. Itmann Coal Co., 3 
F.3d 713, 717 n. 3 (4th Cir. 1993); Tussey v. Island Creek Coal Co., 
982 F.2d 1036, 1042 (6th Cir. 1993); McClendon v. Drummond Coal Co., 
861 F.2d 1512, 1514 (11th Cir. 1988); Micheli v. Director, OWCP, 846 
F.2d 632, 636 (10th Cir. 1988); Schaaf v. Matthews, 574 F.2d 157, 160 
(3d Cir. 1978). Such deference, however, is not an unqualified 
``blanket rule'' which must be applied mechanically; the adjudicator 
must still determine whether the physician's opinion is reasoned, 
documented and credible before accepting it over contrary opinions. 
Grizzle v. Pickands Mather and Co., 994 F.2d 1093, 1097 (4th Cir. 
1993); Peabody Coal Co. v. Helms, 901 F.2d 571, 573 (7th Cir. 1990); 
Halsey v. Richardson, 441 F.2d 1230, 1236 (6th Cir. 1971); Tedesco v. 
Director, OWCP, 18 Black Lung Rep. (MB) 1-104, 1-105 (1994). The 
proposed changes to Sec. 718.104 codify the principles embodied in both 
lines of cases and draw on a similar regulation adopted by the Social 
Security Administration, 20 CFR 404.1527(d)(2).
    A physician's status as the miner's treating physician can provide 
a legitimate basis for preferring that opinion over the reports of 
doctors who have examined the miner only once or reviewed only medical 
records and test data. Such status alone, however, is no substitute for 
a critical analysis of both the nature and extent of the patient-doctor 
relationship and the credibility of the opinion submitted by the 
physician. The proposed regulation enumerates the four basic factors in 
evaluating the physician's relationship with the miner: (i) nature of 
relationship (pulmonary versus non-pulmonary treatment); (ii) duration 
of relationship (length of time treating the miner); (iii) frequency of 
treatment (number of visits over time); and (iv) extent of treatment 
(types of tests and examinations conducted). Each factor will vary from 
claim to claim. Consequently, no ``bright-line'' rule can be utilized 
which defines when a treating physician's opinion should be given 
controlling weight.
    Paragraph (d)(5) underscores the requirement that, status aside, 
the treating physician must provide a reasoned and documented opinion 
before his conclusions can be accorded controlling weight. Status 
cannot cure deficiencies in testing and explanation which would be 
fatal flaws in reports from a non-treating physician. Accordingly, this 
provision requires the adjudicator to consider the treating physician's 
opinion on its own merits and in the context of the remainder of the 
record to determine whether deference to the treating physician is 
appropriate.
    20 CFR 718.105. Section 718.105 should be amended to address 
studies administered during the miner's terminal illness. During such 
an illness, arterial blood gas studies may produce qualifying results 
for reasons unrelated

[[Page 3343]]

to a chronic respiratory or pulmonary disease. In order to avoid 
reliance on ``deathbed'' qualifying data, proposed paragraph (d) should 
be added. This provision simply ensures the probative value of such 
tests as evidence of a chronic respiratory or pulmonary impairment by 
requiring the claimant to submit a physician's report attesting to the 
link between the qualifying scores and the miner's chronic pulmonary 
condition.
    20 CFR 718.106. Paragraph (b) should be rewritten to account for 
the changes to Sec. 718.101. Paragraph (b) is revised to utilize 
language similar to parallel provisions in the other quality standards 
provisions, which account for the general ``substantial compliance'' 
standard contained in the amended Sec. 718.101. The word 
``noncomplying'' is substituted for ``nonconforming'' to ensure 
consistent terminology in similar circumstances.
    20 CFR 718.107. Section 718.107 should be amended to make explicit 
the burden of proof a party bears to demonstrate that the proffered 
test or procedure is ``medically acceptable.'' Section 718.107 enables 
any party to submit medical evidence based on tests or procedures not 
covered by the other provisions of subpart B. This regulation permits 
flexibility in accommodating the use of developing or future medical 
diagnostic techniques beyond the traditional tests specifically covered 
by the quality standards. Proposed paragraph (b) emphasizes the 
requirement that the party proffering the evidence must establish both 
that the evidence is based on medically acceptable tests or procedures 
and that the evidence is relevant to determining the medical issues in 
a benefits claim.

Subpart C--Determining Entitlement to Benefits

    20 CFR 718.201. We are specifically seeking comment on 
Sec. 718.201. The regulatory definition of ``pneumoconiosis'' should be 
revised to clarify the Department's position that this disease is a 
progressive condition which, in some instances, may become detectable 
only after cessation of coal mine employment. The definition should 
also reflect the inclusive nature of the disease, such that no category 
of chronic lung disease can be categorically excluded from the ambit of 
the definition. Two important issues have emerged in recent litigation 
involving the definition of ``pneumoconiosis'': (i) whether the disease 
includes obstructive disorders; and (ii) whether pneumoconiosis is a 
latent disease which can progress after the cessation of dust exposure 
to the point of clinical manifestation. Heretofore, the Department has 
consistently taken the position in litigation and rulemaking that no 
specific lung disease could be categorically excluded from the 
definition of ``pneumoconiosis''; thus, any disease which could be 
medically linked to occupational dust exposure in a particular case 
could be pneumoconiosis. See 43 FR 36825, Aug. 18, 1978, Sec. 727.202 
Discussion and changes (a); 45 FR 13685, Feb. 29, 1980, Sec. 718.201 
Discussion and changes (a); Barber v. Director, OWCP, 43 F.3d 899 (4th 
Cir. 1995). The Department has also argued that pneumoconiosis can 
progress absent exacerbating dust exposure, and may require many years 
to reach the point of detection. The Department has been largely 
successful in litigation involving these issues. The prevalence of the 
issues and the availability of supportive medical research, however, 
warrant making explicit the current regulatory definition to codify 
both positions.

Scope of Definition

    The statutory definition of ``pneumoconiosis,'' as implemented by 
Sec. 718.201, encompasses any chronic respiratory or pulmonary disease 
or impairment caused by the inhalation of coal mine dust. See 30 U.S.C. 
902(b). Thus, any such disease or impairment which can be linked to 
occupational dust exposure by credible medical evidence may be 
considered ``pneumoconiosis'' for purposes of that particular claim. As 
such, the Act recognizes a far broader concept of the disease than does 
the medical community; the latter confines ``coal workers' 
pneumoconiosis'' to the pathologic reaction of lung tissue to dust 
inhalation, resulting in characteristic patterns or markings on chest 
X-rays. See, e.g., ``The Merck Manual of Diagnosis and Therapy'' 681 
(15th ed. 1987); ``National Institute for Occupational Safety and 
Health, Occupational Exposure to Respirable Coal Mine Dust'' Sec. 4.1.2 
(1995); Freeman United Coal Mine Co. v. Director, OWCP, 957 F.2d 302, 
303 (7th Cir. 1992). Amending Sec. 718.201 to acknowledge the 
distinction between the medical and legal definitions emphasizes the 
inclusive nature of ``pneumoconiosis'' for purposes of the black lung 
benefits program.
    In the same vein, adding the phrase ``any chronic restrictive or 
obstructive pulmonary disease'' will foreclose litigation attempting to 
narrow the definition on a claim-by-claim basis with medical opinions 
which exclude obstructive lung disorders from occupationally-related 
pathologies. The NIOSH study on occupational dust exposure contains 
ample medical authority suggesting at least some relationship between 
coal mine dust exposure and the development of chronic obstructive lung 
disease. See ``National Institute for Occupational Safety and Health, 
Occupational Exposure to Respirable Coal Mine Dust'' Sec. 4.2.2 et seq. 
Thus, leaving the issue to resolution in litigation risks inconsistent 
results; indeed, one court has invited such inconsistencies:

    The Act and its regulations define `pneumoconiosis' broadly and 
do not establish that dust exposure from coal mine work can 
necessarily cause obstructive pulmonary disease or impairment. * * * 
Rather, the facts and medical opinions in each specific case answer 
this question.

Blakley v. Amax Coal Co., 54 F.3d 1313, 1321 (7th Cir. 1995); compare 
Warth v. Southern Ohio Coal Co., 60 F.3d 173, 175 (4th Cir. 1995) 
(stating that ``[c]hronic obstructive lung disease thus is encompassed 
within the definition of pneumoconiosis for purposes of entitlement to 
Black Lung benefits[,]'' and rejecting medical opinions based on 
``erroneous assumptions'' to the contrary); Eagle v. Armco, Inc., 943 
F.2d 509, 511 n. 2 (4th Cir. 1991) (describing as ``bizarre'' a medical 
opinion which rejected occupational dust exposure as possible cause of 
chronic obstructive lung disease).

Progressive Nature

    The Department has long maintained the view that simple 
pneumoconiosis is an irreversible disease, which may cause progressive 
deterioration of the lung even after the miner has ceased inhaling coal 
mine dust. Many court and Board decisions reflect acceptance of this 
characterization of the disease's pathology. See, e.g., Mullins Coal 
Co. v. Director, OWCP, 484 U.S. 135, 151 (1987); LaBelle Processing Co. 
v. Swarrow, 72 F.3d 308, 314-315 (3d Cir. 1995); Adkins v. Director, 
OWCP, 958 F.2d 49, 51 (4th Cir. 1992); Lukman v. Director, OWCP, 896 
F.2d 1248, 1253 (10th Cir. 1990); Orange v. Island Creek Coal Co., 786 
F.2d 724, 727 (6th Cir. 1986); Consolidation Coal Co. v. Chubb, 741 
F.2d 968, 973 (7th Cir. 1984); Elkins v. Beth-Elkhorn Coal Co., 2 Black 
Lung Rep. (MB) 1-683, 1-686 (1979). But see Zeigler Coal Co. v. Lemon, 
23 F.3d 1235, 1238 (7th Cir. 1994) (chastising an administrative law 
judge for assuming that pneumoconiosis is progressive without any 
medical evidence in the record to support the assumption). Indeed, the 
propensity for progressive deterioration provides the legal 
justification for permitting additional or

[[Page 3344]]

subsequent claims, even for miners who do not return to coal mining 
after the first claim's denial. See 43 FR 36785, Aug. 18, 1978, 
Sec. 725.309 Discussion and changes (a) (``The Department agrees that a 
miner whose claim has once been finally denied * * * should be allowed 
to file a new claim on the grounds of a progression to total 
disability.''). The fact that the miner was unable to prove even the 
existence of the disease in his initial claim is no bar to a later 
claim since the disease may not have progressed to the point of 
clinical manifestation when he filed the application.
    Current medical science supports the Department's position that 
pneumoconiosis may progress. In P. Francois et al., ``Pneumoconiosis of 
Delayed Apparition: Large Scaled Screening in a Population of Retired 
Coal Miners of the Northern Coal Fields of France,'' in Seventh 
International Pneumoconiosis Conference, Abstracts of Communications 
979 (1988), 741 new cases of pneumoconiosis (out of 3070 miners, or 
24%) were discovered in miners who did not have pneumoconiosis at 
retirement and who had not been exposed to dust for at least 3 years. 
Of these 741 new cases, only 10% had large opacities (complicated 
pneumoconiosis), 69% had category 1 simple pneumoconiosis, and 21% had 
category 2 simple pneumoconiosis. Indeed, the authors specifically 
recite one example of a 66 year old ex-miner who had retired 24 years 
earlier after 25 years of dust exposure. The x-ray at retirement showed 
no evidence of pneumoconiosis, but the one taken 20 years later showed 
obvious pneumoconiosis. Thus, the authors write:

    The coalworker's pneumoconiosis may appear a long time after the 
exposure to nocive [harmful] dust has ceased. This is a well 
established fact. What we don't know is the frequency of such forms 
of pneumoconiosis of long delayed apparition.

Francois at p. 979.
    An earlier study from France provides additional support. In David 
V. Bates et al., ``A Longitudinal Study of Pulmonary Function in Coal 
Miners in Lorraine, France'', 8 Am. J. Ind. Med. 21 (1985), the authors 
observed continued and accelerated rates of decline in lung function 
after retirement from mining in both smokers and nonsmokers. The 
authors suggest that pneumoconiosis at all stages progresses, based on 
``dust loading in the lung, and once this has reached some critical 
level, it is not much affected by removal from exposure.'' Bates at p. 
29. The study includes several graphs depicting ``radiologic category 
at retirement and 10 years later.'' Bates at p. 27. These graphs 
demonstrate a decrease in the percentage of miners with normal or 0/1 
readings, and an increase in the percentage of miners with simple 
pneumoconiosis (category 1/2) as well as complicated pneumoconiosis. By 
way of explanation, Dr. Bates identified miners with normal or 0/1 
readings as ``o-p;'' miners with 1/2 were ``m, n, A, B,'' and miners 
with complicated pneumoconiosis were delineated as ``C.'' Bates at p. 
22. An x-ray showing opacity perfusion of 0/1 is considered negative 
for pneumoconiosis under the regulations. 20 CFR 718.102(b). Thus, the 
data clearly depicts a progression from normal, or negative, x-rays to 
positive x-rays, with the initial appearance of simple pneumoconiosis 
occurring some 10 years after the miners' last dust exposure.
    Other studies and treatises inferentially document, or otherwise 
support, the progressivity of simple pneumoconiosis. See, Helen Dimich-
Ward & David V. Bates, ``Reanalysis of a Longitudinal Study of 
Pulmonary Function in Coal Miners in Lorraine, France,'' 25 Am. J. Ind. 
Med. 613, 621 (1994) (lung function loss and disability may progress 
after exposure ceases); Cockcroft et al., ``Prevalence and Relation to 
Underground Exposure of Radiological Irregular Opacities in South Wales 
Coal Workers with Pneumoconiosis,'' Br. J. Ind. Med. 40: 169, 172 
(1983) (increase in irregular opacities without further dust exposure 
indicates continued tissue reaction to inhaled dust and progression of 
the disease after exposure, although increase in overall profusion of 
opacities not found); 4A Roscoe N. Gray, ``Attorneys' Textbook Of 
Medicine,'' para. 205.71 (3d ed. 1982) (while only method of preventing 
progression of pneumoconiosis is removal from dusty environment, with 
some pneumoconioses progression will continue even after exposure 
ceases); ``The Merck Manual of Diagnosis and Therapy'' 704 (16th ed. 
1992) (explaining that complicated pneumoconiosis may develop and 
progress without further dust exposure); David V. Bates, ``Respiratory 
Function in Disease'' 303 (3d ed. 1989) (silicosis commonly progresses 
after dust exposure ceases). The definition of ``pneumoconiosis'' 
includes silicosis. 20 CFR 718.202. Moreover, complicated 
pneumoconiosis normally develops on a background of category 2 or 3 
simple pneumoconiosis. See e.g. ``The Merck Manual of Diagnosis and 
Therapy'' at p. 704. Thus, the development from simple to complicated 
pneumoconiosis without further dust exposure reveals progression of the 
disease.
    In view of the ample scientific support for the Department's 
interpretation of the scope and nature of the definition of 
``pneumoconiosis,'' Sec. 718.201 should reflect that interpretation 
with more specificity.
    20 CFR 718.202. Paragraph (a)(2) should be amended to make clear 
that a finding of anthracotic pigment in a biopsy procedure, without 
more, is insufficient to establish the presence of pneumoconiosis. The 
current regulation imposes this limitation only with respect to an 
autopsy, but there is no reason to treat these two types of evidence 
differently.
    20 CFR 718.204. The proposed changes to Sec. 718.204 codify several 
of the positions which the Department has taken in litigation to 
clarify the meaning of ``total disability.'' The regulation should 
explicitly reflect the Department's view that ``total disability'' 
means a totally disabling respiratory or pulmonary impairment. The 
proposed changes also provide guidance for establishing the degree to 
which pneumoconiosis must contribute to the miner's disabling 
impairment; to date, the quantification of disability contribution has 
been articulated solely through appellate decisions. In addition, the 
proposed changes make clear that a miner who is totally disabled by a 
compensable respiratory condition is entitled to black lung benefits 
regardless of any concurrent disability by non-respiratory impairments 
or diseases. Finally, the Department proposes to revise the regulation 
to separate disability and disability causation criteria, unify the 
various provisions dealing with lay evidence, and delete paragraph (f), 
which is unnecessary in view of corresponding material in 20 CFR 
725.504.
    Two significant changes have been made to the concept of ``total 
disability.'' First, paragraph (a) makes clear that disabling 
nonrespiratory conditions are irrelevant to determining whether a miner 
is, or was, totally disabled by pneumoconiosis. This change makes clear 
the Department's disagreement with the holding in Peabody Coal Co. v. 
Vigna, 22 F.3d 1388 (7th Cir. 1994). In that case, the miner suffered a 
disabling stroke in 1971, and thereafter applied for benefits under 
part 727. He invoked the interim presumption with qualifying pulmonary 
function evidence from 1979. The Seventh Circuit held, however, that 
the operator rebutted the presumption because the miner's disability 
was caused by the stroke, which was

[[Page 3345]]

unrelated to coal mine dust exposure and occurred before the qualifying 
ventilatory study. Compare Youghiogheny and Ohio Coal Co. v. McAngues, 
996 F.2d 130 (6th Cir. 1993), cert. den. 114 S. Ct. 683 (1994) (holding 
that miner's disabling injuries from automobile accident were 
irrelevant to determining whether he was totally disabled by 
pneumoconiosis). Although Vigna was decided under part 727, the 
proposed changes to paragraph 718.204(a) are designed to ensure that 
the Seventh Circuit's view will not be applied outside that circuit to 
cases arising under part 718.
    The proposed paragraph (a) does recognize one exception to the 
irrelevancy of disabling nonrespiratory conditions in determining 
whether the miner is totally disabled by pneumoconiosis. Such 
conditions or diseases are relevant if they produce a chronic 
respiratory or pulmonary impairment. Some cardiac and neurological 
diseases, for example, may affect the respiratory musculature in such a 
way as to impair the individual's ability to breathe without actually 
affecting the lungs. See, e.g., Panco v. Jeddo-Highland Coal Co., 5 
Black Lung Rep. 1-37 (1982) (concerning respiratory impairment from 
amyotrophic lateral sclerosis, a neurological disease); Maynard v. 
Central Coal Co., 2 Black Lung Rep. 1-985 (1980) (concerning 
respiratory impairment from heart disease); Skursha v. U.S. Steel 
Corp., 2 Black Lung Rep. 1-518 (1980) (same). Similarly, a traumatic 
accident such as an injury to the spinal column may affect breathing 
but not the lungs. The effect of the disease or trauma, its 
relationship to the miner's ability to breathe, and the interplay with 
the miner's pneumoconiosis, all determine the contributing causes of 
the miner's disability.
    The second change involves the definition of ``total disability''. 
The proposed change to paragraph (b)(1) expresses what the Department 
has always maintained: that the ``disability'' which the miner suffers 
is a totally disabling respiratory or pulmonary impairment, and not 
``whole person'' disability. Although the two courts of appeals to 
consider the issue have accepted the Department's position, clarifying 
the definition will hopefully end litigation on this issue. See Beatty 
v.  Danri Corp. & Triangle Enterprises, 49 F.3d 993 (3d Cir. 1995); 
Jewell Smokeless Coal Corp. v. Street, 42 F.3d 241 (4th Cir. 1994).
    Another significant change is the addition of criteria defining 
``disability causation,'' or the degree to which pneumoconiosis must 
contribute to the miner's disability. Several courts have addressed the 
issue, and formulated various standards: Robinson v. Pickands Mather & 
Co./Leslie Coal Co., 914 F.2d 35, 38 (4th Cir. 1990) (``contributing 
cause''); Shelton v. Director, OWCP, 899 F.2d 690, 693 (7th Cir. 1990) 
(necessary though not sufficient cause); Lollar v. Alabama By-Products, 
893 F.2d 1258, 1265 (11th Cir. 1990) (``substantial contributing 
factor''); Adams v. Director, OWCP, 886 F.2d 818, 825 (6th Cir. 1989) 
(disability ``due at least in part'' to pneumoconiosis); Bonessa v. 
United States Steel Corp., 884 F.2d 726, 733 (3d Cir. 1989) 
(``substantial contributor''); Mangus v. Director, OWCP, 882 F.2d 1527, 
1531 (10th Cir. 1989) (at least a ``contributing cause''). Few, if any, 
practical differences exist in the various expressions of the 
contribution standard.
    The Department has concluded that a single standard should be 
articulated to eliminate needless confusion and litigation over the 
relationship between a miner's pneumoconiosis and his disability. The 
Department has selected the ``substantially contributing cause'' 
language because it ensures a tangible and actual contribution; a more 
demanding standard would be too harsh, especially when many miners 
suffer from a multiplicity of respiratory problems. Moreover, the 
``substantially contributing cause'' standard mirrors the criteria for 
proving that pneumoconiosis contributed to the miner's death. See 20 
CFR 718.205(c). The U.S. Court of Appeals for the Third Circuit found 
the contribution standard for death a persuasive basis for interpreting 
the disability standard: ``We perceive no reason why the phrase 'total 
disability due to pneumoconiosis' should not track the phrase `death 
due to pneumoconiosis.''' Bonessa, 884 F.2d at 733.
    Proposed paragraph (c)(1) also defines disability causation in 
terms of worsening a totally disabling respiratory or pulmonary 
condition which is itself wholly caused by non-coal mine exposures. 
Thus, a miner whose pneumoconiosis further damages his lungs may 
establish the necessary causal link even if nonoccupational exposure is 
a self-sufficient cause of the respiratory disability. The proposed 
language reflects the Department's disagreement with the result reached 
by the U.S. Court of Appeals for the Fourth Circuit in Dehue Coal Co. 
v. Ballard, 65 F.3d 1189 (4th Cir. 1995) (holding that a miner who was 
totally disabled by lung cancer was not entitled to benefits because 
his pneumoconiosis could not, by definition, contribute to the 
disability).
    The remaining changes are structural or editorial. Paragraph (c)(5) 
has been changed to paragraph (d) (i) and (ii); the remaining 
provisions addressing the use of lay evidence have been moved into 
paragraph (d) given the commonality of their purpose: establishing 
entitlement through lay evidence. The last sentence of current 
paragraph (c)(5) makes clear that proving disability through clinical 
tests or physicians' reports does not necessarily prove that 
pneumoconiosis caused the disability. This provision therefore 
underscores the difference between disability and disability causation 
as separate elements of entitlement. This point is sufficiently 
important to warrant placement in a separate paragraph as proposed 
paragraph (c)(2). Finally, current paragraph (f) is deleted because it 
simply duplicates 20 CFR 725.504 to the extent that both provisions 
preclude a working miner from receiving benefits unless the award is 
based on a finding of complicated pneumoconiosis.
    20 CFR 718.205. The Department has taken the position that 
pneumoconiosis causes the miner's death if the disease is either the 
actual cause of death or hastens death to an appreciable extent. This 
interpretation of the phrase ``death due to pneumoconiosis'' should be 
made explicit in the regulation. Under the 1981 amendments to the BLBA, 
a deceased miner's survivor who filed a claim on or after January 1, 
1982, is eligible for benefits only if pneumoconiosis caused, or 
contributed to, the miner's death. The Department added paragraph (c) 
to Sec. 718.205 to implement congressional intent that pneumoconiosis 
must play a role in the miner's death in order to entitle a survivor to 
benefits. Based on the legislative history of the 1981 amendments, the 
Department concluded that the disease must be at least a 
``substantially contributing cause'' of the miner's death. See 48 FR 
24276--24277, May 31, 1983, Sec. 718.205 Discussion and changes (h)-
(n). In order to give practical meaning to that phrase, the Department 
has consistently argued in litigation that the medical evidence must at 
least prove that the miner's pneumoconiosis actually hastened his 
death. Four courts of appeals have deferred to the agency's 
interpretation of the regulation. Brown v. Rock Creek Mining Co., 996 
F.2d 812, 816 (6th Cir. 1993); Peabody Coal Co. v. Director, OWCP, 972 
F.2d 178, 183 (7th Cir. 1992); Shuff v. Cedar Creek Coal Co., 967 F.2d 
977, 980 (4th Cir. 1992), cert. den. 113 S.Ct. 969 (1993); Lukosevicz 
v. Director, OWCP, 888 F.3d 1001, 1006

[[Page 3346]]

(3d Cir. 1989). The Benefits Review Board has refused to adopt the 
Department's position, but has not articulated an alternative standard. 
See, e.g., Tackett v. Armco, Inc., 16 Black Lung Rep. (MB) 1-88, 1-93 
(1992), vacated on remand 17 Black Lung Rep. (MB) 1-103, 1-104 (1993). 
In order to ensure consistent application of a single legal standard, 
paragraph (c) of Sec. 718.205 should be amended by adding proposed 
paragraph (c)(5), which codifies the Department's views.

Subpart D--Presumptions Applicable to Eligibility Determinations

    20 CFR 718.301. Paragraph (b) should be removed because a new 
definition of ``year'' is added to 20 CFR 725.101(a). Paragraph (a) of 
Sec. 718.301 should be amended to make reference to proposed 
Sec. 725.101(a)(32) and its requirements. Section 718.301 is one of two 
regulations which currently define ``year'' for determining the length 
of a miner's occupational history; the other regulation is 20 CFR 
725.493(b) (identifying responsible operator). The Department has 
concluded that a single regulatory definition with program-wide 
application should replace the two current regulations. Determining the 
length of a miner's occupational history is the same inquiry for 
establishing eligibility for presumptions as for identifying a 
responsible operator, and a single standard should apply in both cases.
    20 CFR 718.307. Remove 20 CFR 718.307 (a) and (b) and add the 
contents of Sec. 718.307(a) to 20 CFR 725.103. Paragraph (a) contains 
material which concerns any claim filed under the BLBA, and not just 
claims governed by the part 718 medical criteria. Accordingly, the 
contents of paragraph (a) will be removed from part 718 and placed in 
Sec. 725.103. See proposed Sec. 725.103. Paragraph (b) effectively 
duplicates new proposed Sec. 725.103, which more broadly describes the 
burden of proof. This language should therefore be removed.

Subpart E--Miscellaneous Provisions

    20 CFR 718.401. Remove Sec. 718.401 because it duplicates proposed 
Sec. 725.406. Current Sec. 718.401 recognizes each miner's statutory 
right to a complete pulmonary evaluation at the Department's expense. 
See 30 U.S.C. 923(b). This regulation also authorizes both the miner 
and the district director to develop additional medical evidence. 
Section 718.401 duplicates material in the cross-referenced 
regulations, 20 CFR Secs. -725.405 and 725.406; the part 725 
regulations have program-wide applicability. Consequently, no need 
exists for including this regulation in part 718.
    20 CFR 718.402. Remove the first sentence of Sec. 718.402 and add 
the remainder of this provision to proposed Sec. 725.414(a)(3)(iii). 
Section 718.402 describes the consequences of a claimant's failure to 
cooperate in the development of medical evidence needed to adjudicate 
the claim. This provision duplicates the substance of proposed 
Sec. 725.414(a)(3)(iii), which deals with a claimant's unreasonable 
refusal to submit to medical examinations and testing. Section 718.402 
also penalizes the claimant who refuses to provide a complete health 
history or permit access to medical records. This aspect of the 
regulation will be added to proposed Sec. 725.414. Given the 
overlapping purposes of the two regulations, Sec. 718.402 should be 
removed from part 718 in favor of proposed Sec. 725.414, which has 
program-wide applicability.
    20 CFR 718.403. Remove 20 CFR 718.403 from part 718 and add to part 
725. Section 718.403 codifies the burden of proof imposed on any party 
alleging any fact in support of its position under part 718. The 
parties to a claim, however, are required to prove a variety of facts 
under part 725 which also bear on entitlement issues, e.g., status as a 
miner (Sec. 725.202); dependency and relationship (Secs. 725.204-
725.228); liability as a responsible operator (subpart G); and 
entitlement to medical benefits (subpart J). Part 725 does not contain 
a counterpart to Sec. 718.403. Accordingly, a single provision 
generally allocating the parties' burdens of proof under the BLBA 
logically should be placed in part 725, the regulations with program-
wide applicability. See proposed Sec. 725.103.
    20 CFR 718.404. Remove 20 CFR 718.404 from part 718 and move to 
part 725. Section 718.404(a) makes explicit a miner's obligation to 
inform the Department and the responsible operator, if any, if he 
resumes work in a coal mine or comparable and gainful work. A return to 
such work requires the termination of benefits unless the miner's award 
is based on complicated pneumoconiosis. See 20 CFR 725.504(c). 
Paragraph (b) reiterates the Department's authority to reopen a finally 
approved claim during the lifetime of the miner and develop medical 
evidence if the particular circumstances so warrant. Both provisions 
are more logically placed in part 725 as regulations of program-wide 
applicability. See proposed Sec. 725.203 (c) and (d).

Appendix B to Part 718

    Appendix B to Part 718, 2(ii). The technical requirements for the 
administration of pulmonary function studies should be amended to 
preclude taking the initial inspiration from the open air. The quality 
standards currently permit an individual performing a pulmonary 
function study to take the initial inspiration from either the open air 
or the testing machine. The proposed regulation eliminates this choice. 
Open air inspiration is not recorded on the spirogram, which documents 
the performance of the test. Consequently, the validity of such an 
initial inspiration cannot be independently verified by a reviewing 
physician. Because less than optimum inspiration will produce a ``false 
low'' result, such tests may yield erroneously abnormal values. The 
open-air inspiration option therefore must be eliminated in order to 
ensure that the validity of every pulmonary function study can be 
independently ascertained.
    The Department does not propose to change Tables B1-B6 in Appendix 
B, which are used to evaluate the results of pulmonary function tests 
(see proposed Sec. 718.204(b)(2)(i)). Accordingly, the tables will not 
be republished in either the proposed or final versions of this rule in 
the Federal Register. The tables will continue to be published as part 
of Appendix B to part 718 in the Code of Federal Regulations once this 
rule becomes final, however. Parties interested in reviewing the tables 
may consult earlier editions of the Code of Federal Regulations or the 
Federal Register in which the tables were originally promulgated, 45 FR 
13699-13710, Feb. 29, 1980.
    Appendix C to Part 718. Appendix C should be amended to specify 
that arterial blood gas studies should not be conducted during, or 
shortly after, a miner's acute respiratory illness. Such studies are 
likely to produce spurious values which are not indicative of the 
miner's true condition.

20 CFR Part 722--Criteria for Determining Whether State Workers' 
Compensation Laws Provide Adequate Coverage for Pneumoconiosis and 
Listing of Approved State Laws

    Section 421 of the Black Lung Benefits Act requires the Secretary 
of Labor to publish in the Federal Register a list of all states whose 
workers' compensation laws provide ``adequate coverage'' for 
occupational pneumoconiosis. 30 U.S.C. 931(a). The purpose of this 
provision was to allow states to assume responsibility for providing 
compensation to former coal

[[Page 3347]]

miners who were totally disabled due to pneumoconiosis and to their 
dependent survivors in the event of the miner's death due to 
pneumoconiosis. See Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 8-9 
(1976). The Secretary's certification that a state law provides 
adequate coverage prevents any claim for benefits arising in that state 
from being adjudicated under the Black Lung Benefits Act. To date, no 
state law has been approved.
    The Act provides that a state may be included on the Secretary's 
list only if its provisions governing benefit amounts, entitlement 
standards, statute of limitations, and prior and successor operator 
liability are ``substantially equivalent'' to those contained in the 
Act. 30 U.S.C. 931(b)(2). In addition, the Secretary may promulgate 
additional regulations to ensure adequate compensation for total 
disability or death due to pneumoconiosis. 30 U.S.C. 931(b)(2)(F). The 
Secretary first promulgated regulations under this authority on March 
12, 1971, and amended those regulations on March 30, 1973 in light of 
changes to the Longshore and Harbor Workers' Compensation Act in 1972. 
38 FR 8238, March 30, 1973. These regulations, codified at 20 CFR part 
722, have not been amended since 1973. In light of the subsequent 
statutory changes made by the Black Lung Benefits Reform Act of 1977 
and the Black Lung Benefits Amendments of 1981, the current regulations 
are obsolete.
    The Department has recently concluded a review of all of the 
regulations implementing the Act, and has determined that the continued 
publication of these criteria in the Code of Federal Regulations is no 
longer required. Accordingly, rather than amend the regulations to 
reflect the current law, the Department intends to simply delete the 
specific criteria and replace them with a general statement that in the 
future, upon application of any state, the Department will review the 
state's workers' compensation law in light of the current Act to 
determine whether the state law provides adequate coverage. Guided by 
the criteria set forth in 30 U.S.C. 931(b)(2), the Department will 
approve such a state law only if it guarantees at least the same 
compensation, to the same individuals, as is provided by the Act. The 
Act requires that if the Department approves any state laws, it publish 
a list of the affected states in the Federal Register, 30 U.S.C. 
931(b)(1).
    Finally, the revised regulations substitute the gender neutral term 
``workers' compensation laws'' for the term ``workmen's compensation 
laws,'' used in the statute. No substantive alteration in the statutory 
term is intended.

20 CFR Part 725--Claims for Benefits Under Part C of Title IV of the 
Federal Mine Safety and Health Act, as Amended

Subpart A--General

    20 CFR 725.1. Section 725.1 provides a broad overview of the 
various parts of the Black Lung Benefits Act (BLBA), the amendments 
thereto, and the incorporation of the Longshore and Harbor Workers' 
Compensation Act (LHWCA). The Department proposes to amend this 
regulation to include a comparable reference to the Social Security 
Act, 42 U.S.C. 301 et seq., provisions of which are also incorporated 
into Parts A, B and C of the BLBA. The BLBA is actually three statutes 
in one. The Act itself is subchapter IV of the Mine Safety and Health 
Act, chapter 30 of the United States Code. Part C of the Act, which the 
Department administers, also incorporates many provisions of the LHWCA, 
33 U.S.C. 901 et seq. Congress authorized the Department to vary the 
terms of the incorporated LHWCA provisions by regulation, and the 
Department has done so when the special requirements of the black lung 
benefits program dictated the variance. Congress also incorporated 
parts of the Social Security Act into Parts A and B of the BLBA. 
Congress once again authorized the Department to adopt and modify the 
Part B provisions ``to the extent appropriate'' for use in the 
administration of Part C. Accordingly, Sec. 725.1 should be amended to 
include a brief description of the Social Security Act incorporation 
comparable to the present discussion of the LHWCA incorporation.
    20 CFR 725.2. For an explanation of the changes to paragraph (b), 
see the explanation of the changes to Sec. 725.4. Paragraph (c) should 
be added to explain the applicability of these regulatory revisions to 
pending claims and to claims filed after the effective date of the 
revised regulations. The Department intends that the proposed revisions 
announced in this Notice will apply to the adjudication of all claims 
for benefits under the Black Lung Benefits Act pending with the 
Department on the date these revisions go into effect, to the extent 
that such application is consistent with the Department's authority 
under the Black Lung Benefits Act and with the efficient administration 
of the program. The Department considers a claim to be pending if the 
claim has not yet been finally denied, or less than one year has passed 
since the claim was finally denied. In addition, all of the proposed 
regulations will apply to any claim filed after the regulations become 
final.
    The Supreme Court has held that a statutory grant of legislative 
rulemaking authority to an agency does not confer the power to issue 
retroactive rules unless Congress expressly provides such power. Bowen 
v. Georgetown University Hospital, 488 U.S. 204, 208 (1988). The Black 
Lung Benefits Act does not contain such an express grant. Accordingly, 
the Department's ability to issue rules of retroactive application is 
circumscribed.
    Determining whether a rule is one of retroactive application, 
however, is often difficult. In Landgraf v. USI Film Products, 114 S. 
Ct. 1483 (1994), the Court adopted the definition set forth by Justice 
Story in Society for Propagation of the Gospel v. Wheeler, 22 F.Cas. 
756 (No. 13,156) (CCDNH 1814):

    [E]very statute, which takes away or impairs vested rights 
acquired under existing law, or creates a new obligation, imposes a 
new duty, or attaches a new disability, in respect to transactions 
or considerations already past, must be deemed retrospective. * * *

114 S. Ct. at 1499. The Court observed, however, that ``[a] statute 
does not operate `retrospectively' merely because it is applied in a 
case arising from conduct antedating the statute's enactment, or upsets 
expectations based in prior law.'' Ibid. (citation omitted).
    One example of an attempt to regulate retroactively was the 
Department of Health and Human Services regulation at issue in 
Georgetown University Hospital. In 1983, the U.S. District Court for 
the District of Columbia had invalidated a 1981 HHS regulation 
governing hospital reimbursement for failure to provide notice and an 
opportunity to comment. In 1984, HHS reissued the regulation following 
notice and comment, and attempted to make it retroactive to 1981. The 
Supreme Court invalidated the second regulation as an unauthorized 
attempt to promulgate a retroactive regulation. At the other end of the 
spectrum are procedural changes. As the Supreme Court noted in 
Landgraf, ``[c]hanges in procedural rules may often be applied in suits 
arising before their enactment without raising concerns about 
retroactivity.'' 114 S. Ct. at 1502.
    For purposes of retroactivity, the revisions to the Department's 
regulations implementing the Black Lung Benefits Act, 30 U.S.C. 901 et 
seq., may be divided into two groups. The first, consisting of 
revisions to part 726, have no effect on the adjudication of

[[Page 3348]]

claims filed under the Act. Those revisions, which establish procedures 
for enforcing the general obligation of coal mine operators to secure 
the payment of benefits under the Act, will be made effective 
immediately upon publication of the final rule, and will govern all 
subsequent penalty assessments.
    The Department also proposes to revise various provisions in part 
726 that address the requirements imposed on coal mine operators who 
seek the Department's authority to self-insure their liability. These 
revisions merely clarify the Department's existing interpretation of 
the Act. Accordingly, these regulations may apply to the evaluation of 
past conduct. In Pope v. Shalala, 998 F.2d 473, 483 (7th Cir. 1993), 
the court held that ``[a] rule simply clarifying an unsettled or 
confusing area of the law * * * does not change the law, but restates 
what the law according to the agency is and has always been: 'It is no 
more retroactive in its operation than is a judicial determination 
construing and applying a statute to the case.' Manhattan General 
Equip. Co. v. Commissioner, 297 U.S. 129, 135 (1936).''
    The second, and largest, group of revisions are those amending 
Parts 718 and 725, which govern the adjudication of claims for benefits 
filed by miners and their survivors, as well as the payment of benefits 
in approved claims. A number of the revisions alter the procedures to 
be used in adjudication, including those related to processing of 
claims by the district director, the adjudication of claims before the 
Office of Administrative Law Judges, responsible operator issues, and 
subsequent claims. These changes, however, significantly alter the 
parties' obligations and expectations, for example, by limiting 
evidence, creating presumptions, and establishing burdens of proof. 
Accordingly, despite the Department's authority under Georgetown 
University Hospital and Landgraf to issue procedural rules that take 
effect immediately, the Department proposes to apply the revised 
versions of the regulations governing those topics only to claims filed 
after the effective date of the amendments. Because the remaining 
revisions merely clarify the Department's interpretation of the current 
Act and regulations, the Department intends to apply them to all claims 
pending with the Department, and to the payment of all benefits that 
become due and payable, or that remain unpaid, after the effective date 
of these revisions.
    20 CFR 725.4(d). In 1978, Congress required the Department of Labor 
to promulgate interim entitlement criteria that were ``no more 
restrictive'' than criteria used to adjudicate claims that had been 
filed with the Social Security Administration under Part B of the Black 
Lung Benefits Act. These interim criteria were to be used until the 
Department could develop permanent criteria. The interim part 727 
regulations were published at 43 FR 36818, Aug. 18, 1978. Because the 
Department's permanent part 718 criteria took effect on April 1, 1980, 
see 20 CFR 718.2, the part 727 regulations apply only to claims filed 
before that date. The Department estimates that several hundred part 
727 claims remain pending in various stages of adjudication. Because 
the parties to these claims are quite familiar with the standards for 
establishing eligibility under part 727, and no new claims will be 
adjudicated under these standards, the Department intends to 
discontinue the annual publication of part 727 in the Code of Federal 
Regulations. Those standards will remain in effect for all claims to 
which they apply. Parties interested in reviewing part 727 may consult 
earlier editions of the Code of Federal Regulations or the Federal 
Register in which the regulations were originally published.
    20 CFR 725.101. The terms defined by Sec. 725.101(a)(4) et seq. 
have been put in alphabetical order to assist the reader in finding the 
appropriate definitions. The explanations below refer to the renumbered 
paragraphs.
    20 CFR 725.101(a)(6). Benefits. The regulation should be amended to 
make clear that the initial pulmonary evaluation obtained by the 
Department pursuant to 30 U.S.C. 923(b) is considered a ``benefit'' 
paid by the Trust Fund or the operator on the claimant's behalf. The 
clinical testing and medical examination required by Sec. 413(b) of the 
BLBA confer a ``benefit'' on the miner to the extent that the Trust 
Fund pays for the miner's opportunity to substantiate his claim.
    20 CFR 725.101(a)(13), Coal Preparation; (a)(19), Miner or Coal 
Miner. The regulation should be amended to reflect the Department's 
position that coke oven workers are not covered by the BLBA. The 
Department has long taken the position that the preparation activities 
undertaken at coke ovens are not covered by the BLBA. This position 
reflects Congress' understanding of the scope of coverage intended by 
the statutory definition of ``miner.'' 30 U.S.C. 902(d). See S.Rep. No. 
209, 95th Cong., 1st Sess. 21 (May 16, 1977) (``Nor does [the 
definition] include such individuals not directly related to the 
production of coal such as coke oven workers.''); 123 Congressional 
Record 24,236 (1977) (Sen. Randolph: ``* * * coke oven workers are not 
included in the definition.''). See also Fox v. Director, OWCP, 889 
F.2d 1037 (11th Cir. 1989); Sexton v. Matthews, 538 F.2d 88 (4th Cir. 
1976). This clarifying language ensures that the definitions of ``coal 
preparation'' and ``miner or coal miner'' do not encompass activities 
involving the commercial production of coke, which is outside the 
extraction and transportation processes.
    20 CFR 725.101(a)(16). District Director. The proposed change 
merely conforms the regulation to current administrative practice, and 
ensures that any action taken by, or in the name of, a district 
director shall be given full credit as the action of a deputy 
commissioner.
    20 CFR 725.101(a)(17). Division or DCMWC. The proposed change 
specifies the agency within the Department which contains the Office of 
Workers' Compensation Programs and the Division of Coal Mine Workers' 
Compensation.
    20 CFR 725.101(a)(31). Workers' Compensation Law. This definition 
should be amended to make clear that certain benefits paid from a 
state's general revenues are not workers' compensation payments for 
purposes of the BLBA. The BLBA requires the Department to offset a 
claimant's federal benefits by any benefits received from a state 
pursuant to a workers' compensation law for disability or death due to 
pneumoconiosis. 30 U.S.C. 932(g). Since the Act's inception, the 
Department has considered payments made to disabled miners by a state 
from general revenues to be excluded from benefits afforded by 
``workers' compensation laws.'' Both the Third Circuit and the Benefits 
Review Board, however, have rejected the Department's position. 
O'Brockta v. Eastern Associated Coal Co., 18 Black Lung Rep. 1-72 
(1994), aff'd sub nom. Director, OWCP v. Eastern Associated Coal Co., 
54 F.3d 141 (3d Cir. 1995). The Board held that Sec. 932(g) clearly 
refers to ``workers' compensation law'' without regard to the source of 
funding for the payments. The Third Circuit rejected this reasoning but 
agreed that the Department's position was wrong. The Court held that 
Sec. 932(g) is ambiguous, but that the Department's policy 
impermissibly implies limitations on current Sec. 725.101(a)(4) which 
are inconsistent with the unequivocal language of the regulation. The 
Court suggested that the Department amend

[[Page 3349]]

the regulation to codify its policy. The proposed regulation makes 
clear the Department's longstanding policy that payments made from a 
state's general revenues are not workers' compensation benefits subject 
to offset under the Act.
    20 CFR 725.101(a)(32). The BLBA does not define a ``year'' for 
purposes of computing the length of a miner's occupational history. In 
1978 and 1980, the Department promulgated regulations which adopted the 
current 125-day rule. 20 CFR 725.493(b), 718.301(b). The rationale for 
this policy decision is explained in detail in the comments 
accompanying the final regulations. 43 FR 36804, Aug. 18, 1978, 
Sec. 725.493, Discussion and changes (b); 45 FR 13691, Feb. 29, 1980, 
Sec. 718.301, Discussion and changes (b). The regulations are 
substantially the same, but not identical. The proposed 
Sec. 725.101(a)(32) consolidates provisions of the two existing 
regulations into a definitional term with program-wide application.
    In addition, the regulation codifies the Department's current 
position with respect to absences, such as vacation and sick leave, 
that are approved by the miner's employer. In such cases, where the 
employer/employee relationship is uninterrupted, a miner is credited 
with having worked during the period of the approved absence. Other 
absences, such as the time during a strike or layoff, are not counted 
as working days. Finally, the proposed section permits the adjudication 
officer to use the Office's methodology for computing the length of the 
miner's employment history as a fallback. See ``Coal Mine (BLBA) 
Procedure Manual,'' ch. 2-700 (1994). The Bureau of Labor Statistics 
(BLS) has compiled the average daily and annual wages for the coal mine 
industry. A table of this data appears in the Office's Manual. If the 
best available evidence consists of annual income statements, the 
amount of time the miner worked each year as a miner may be computed by 
dividing the reported income by the average daily income for that year. 
The miner may be credited with a year, or a fractional part of a year, 
based on the ratio of this data. If, however, the miner's annual income 
exceeded the average income for that year, he may not be credited with 
more than a year of employment for that income year.
    20 CFR 725.103. Section 718.403 presently codifies the burden of 
proof imposed on any party alleging any fact in support of its position 
under part 718. The parties to a claim, however, are required to prove 
a variety of facts under part 725 which also bear on entitlement 
issues, e.g., status of a miner (Sec. 725.202); dependency and 
relationship (Secs. 725.204-725.228); liability as a responsible 
operator (subpart G); and entitlement to medical benefits (subpart J). 
Part 725 does not contain a counterpart to Sec. 718.403. Accordingly, a 
single provision generally allocating the parties' burdens of proof 
under the BLBA logically should be placed in part 725 since those 
regulations have program-wide applicability.

Subpart B--Persons Entitled to Benefits, Conditions, and Duration of 
Entitlement

    20 CFR 725.202. The BLBA contains a broad definition of ``miner'' 
which the courts have liberally construed. See Dowd v. Director, OWCP, 
846 F.2d 193 (3d Cir. 1988). In keeping with that liberal construction, 
this regulation should be amended to create a rebuttable presumption 
that any individual working at a coal mine or coal preparation facility 
is a miner. The presumption is grounded in common sense: the vast 
majority of persons working at a coal mine will ordinarily have duties 
related to the mining processes of coal extraction and/or preparation. 
This presumption can be rebutted by evidence that the individual is not 
actually performing work integral to the extraction or preparation of 
coal, or the individual's work involves only casual contact with the 
coal mine operation. The structure of the regulation should also be 
changed to distinguish special provisions relating to transportation 
and construction workers. Of special note is the fact that construction 
workers alone are relieved of the burden to prove that their work 
involves the extraction or preparation of coal; working at a coal mine 
site in construction activities which involve mine dust exposure is 
sufficient to make them miners. See The Glem Company v. McKinney, 33 
F.3d 340 (4th Cir. 1994).
    20 CFR 725.203. One of the elements of entitlement required by 
Sec. 725.202 is that the miner file a claim. Section 725.203(a), as 
currently written, provides that all of the Sec. 725.202 requirements 
must be satisfied for each month of entitlement. These criteria 
effectively mean that the first month in which the miner fulfills all 
the requirements for entitlement will never be earlier than the month 
in which he files an application for benefits. A miner, however, is 
entitled to benefits for all periods of compensable disability, 
including any period of disability occurring before the claim is filed. 
20 CFR 725.503. To the extent that the cross-reference to Sec. 725.202 
improperly limits the miner's entitlement period (and conflicts with 20 
CFR 725.503), the reference will be removed, and the language clarified 
to conform to Sec. 725.503.
    New paragraphs (c) and (d) incorporate material from 20 CFR 
718.404, which has been deleted. Paragraph (c) makes explicit a miner's 
ineligibility for black lung disability benefits if the miner resumes 
his usual coal mine work or comparable and gainful work absent the 
presence of complicated pneumoconiosis. Paragraph (d) reiterates the 
Department's authority to reopen a finally approved claim during the 
lifetime of the miner and develop medical evidence if the particular 
circumstances warrant reopening. Both provisions are more logically 
placed in part 725 as regulations of program-wide applicability. See 20 
CFR 725.2(b).
    20 CFR 725.204, .214. Sections 725.204 and 725.214 should be 
amended to recognize the coexisting eligibility of both a qualified 
spouse and an individual who married the miner in ignorance of a legal 
impediment to that marriage. The BLBA incorporates Sec. 416(h)(1) of 
the Social Security Act (SSA), which describes the requirements for 
establishing the marital relationship between the wage earner and the 
spouse for purposes of qualifying as a ``wife, husband, widow or 
widower.'' 42 U.S.C. 416(h)(1), as incorporated by 30 U.S.C. 902(a)(2), 
(e). The Department has implemented Sec. 416(h)(1) in the current 
Secs. 725.204 (for spouses) and 725.214 (for surviving spouses). Recent 
amendments to the SSA require corresponding changes in the regulations.
    Section 416(h)(1) recognizes that both the ``legal'' and ``deemed'' 
spouses may be entitled to benefits. An individual qualifies as the 
miner's ``legal'' spouse by proving the existence of a valid marriage 
under state law. A ``deemed'' spouse, however, must demonstrate that he 
lived with the miner either at the time of application or the time of 
the miner's death, and:

in good faith went through a marriage with such individual resulting 
in a purported marriage between them which, but for a legal 
impediment not known to the applicant at the time of such ceremony, 
would have been a valid marriage * * *.

42 U.S.C. 416(h)(1)(B)(i). The SSA defines a ``legal impediment'' as

only an impediment (I) resulting from the lack of dissolution of a 
previous marriage or otherwise arising out of such previous marriage 
or its dissolution, or (II) resulting from a defect in the procedure 
followed in connection with such purported marriage.

42 U.S.C. 416(h)(1)(B)(iv).
    Before 1990, Sec. 416(h)(1)(B) contained a provision preventing a 
``deemed''

[[Page 3350]]

spouse from receiving benefits if a ``legal'' spouse existed and was 
receiving benefits on the wage earner's account:

    The [deemed spouse] provisions shall not apply if (i) another 
person is or has been entitled to [old age and survivor's insurance] 
benefit[s] * * * on the basis of the wages and self-employment 
income of such insured individual and such other person is (or is 
deemed to be) [the legal spouse] * * * of such insured individual 
under subparagraph (A) at the time such applicant files the 
application * * *.

42 U.S.C. 416(h)(1)(B) (1989). The Department used this version of 
Sec. 416(h)(1) in promulgating the current regulatory criteria for 
proving a relationship between the miner and spouse or surviving 
spouse.
    In 1990, Congress amended Sec. 416(h)(1)(B) by deleting the bar on 
entitlement for a deemed spouse even if a legal spouse existed and was 
receiving benefits. Omnibus Budget Reconciliation Act, Sec. 5119, 104 
Stat. 1388-278 to 1388-280 (1990). The express purpose of the amendment 
was to allow payment of concurrent benefits to both the legal and the 
deemed spouses. See H. Rep. No. 101-964, 1990 U.S.C.C.A.N. 2649, 2650 
(conference report). Congress intended that ``the existence of a legal 
spouse would no longer prevent a deemed spouse from receiving benefits 
on the worker's record or terminate the benefits of a deemed spouse who 
was already receiving benefits on the worker's record.'' Id. at 2650. 
Moreover, Congress expected that a deemed spouse would receive benefits 
``on the same basis as if * * * she were a legal spouse * * *.'' Id. 
The Social Security Administration amended its disability regulation to 
reflect the statutory changes (see 20 CFR 404.346); it has not yet 
amended the part 410 regulations, which govern its administration of 
Part B of the BLBA. See 20 CFR part 410, subpart C (``Relationship and 
Dependency'').
    The proposed changes to Secs. 725.204 and 725.214 amend the 
dependent and surviving spouse relationship criteria to conform to 
changes in the SSA. Such changes are required for the regulations 
affecting surviving spouses, given the incorporation of the SSA 
statutory definitions of ``dependent'' and ``widow''. Moreover, 
Congress has previously evidenced the intent to harmonize the SSA and 
the BLBA statutory provisions which address marital status (see 
Explanation of proposed changes to Sec. 725.212); eliminating the 
``deemed'' spouse bar is consistent with this congressional policy.
    20 CFR 725.209, .219, .221, .222. These provisions should reflect 
the age limit for a disabled dependent currently specified in 42 U.S.C. 
402(d)(1)(B), as incorporated into the BLBA by 30 U.S.C. 902(g). 
Section 402(g)(ii) of the BLBA defines ``child'' to include an 
individual who is disabled by SSA standards, provided such disability 
``began before the age specified in section 202(d)(1)(B)(ii) of the 
Social Security Act * * *.'' Congress has raised the age for the onset 
of disability for the SSA program from 18 to 22 since Sec. 725.209 was 
promulgated. Because the BLBA specifically incorporates its disability 
age limit from the SSA, the regulation should be changed to reflect the 
change in the SSA. Finally, the parenthetical cross-reference to 20 CFR 
404.320(c) in Sec. 725.209(b)(1) is corrected. The SSA regulations 
which concern full-time student criteria are 20 CFR 404.367 through 
404.369.
    20 CFR 725.212. Proposed paragraph (b) reflects the Department's 
position that the BLBA and pertinent legislative history require the 
payment of full monthly survivor's benefits to each surviving spouse 
and surviving divorced spouse who satisfies the entitlement criteria, 
regardless of the existence of any other spouse who also qualifies for 
benefits.
    Prior to 1992, the Department's policy regarding the allocation of 
benefits between (or among) multiple surviving spouses of the same 
miner, as stated in the ``Coal Mine (BLBA) Procedure Manual,'' limited 
each spouse to less than full monthly benefits:

    If more than one claimant is found entitled, no more than the 
maximum amount of benefits for the number of beneficiaries involved 
may be paid under Part C. (e.g., where a surviving spouse and a 
divorced spouse both qualify, no more than the claimant plus one 
dependent benefits may be paid). This maximum amount is divided 
equally between the eligible beneficiaries of equal status.

Ch. 2-900 para. 8(b) (February 1980). In 1992, the Department 
reconsidered this position and concluded that each surviving spouse who 
meets the criteria for eligibility is entitled to the payment of the 
full benefits due a surviving spouse. This change in position was the 
result of further reflection on pertinent provisions of the BLBA and 
their legislative history.
    The BLBA's definition of ``widow'' must be considered in the 
context of the Social Security Act's (SSA) definition because SSA's 
definition is incorporated into the BLBA, and Congress has consistently 
attempted to harmonize the two provisions. Before 1965, the SSA awarded 
widow's benefits only to a surviving spouse. See Social Security 
Amendments of 1965, Pub. L. No. 89-97, Sec. 308(b)(1), 79 Stat. 286 
(1965). The legislative history to the 1965 amendment explicates the 
intended operation of the changed definition:

    Payment of a wife's or widow's benefit to a divorced woman would 
not reduce the benefit paid to any other person on the same social 
security account and such wife's or widow's benefit would not be 
reduced because of other benefits payable on the same account.

S. Rep. No. 404, 89th Cong., 1st Sess. (1965), reprinted in 1965 
U.S.C.C. & A.N. 1943, 2047. See ``Social Security Program Operations 
Manual (POMS)'' RS 00615.682 (both surviving spouses and surviving 
divorced spouses awarded full [100 percent] benefits).
    In 1972, Congress amended the BLBA's definition of a ``widow'' to 
permit the payment of benefits to a miner's surviving divorced spouse. 
That definition, as amended, now reads:

    Such term [widow] also includes a `surviving divorced wife' as 
defined in section 216(d)(2) of the Social Security Act who for the 
month preceding the month in which the miner died, was receiving at 
least one-half of her support, as determined in accordance with 
regulations prescribed by the Secretary, from the miner, or was 
receiving substantial contributions from the miner (pursuant to a 
written agreement) or there was in effect a court order for 
substantial contributions to her support from the miner at the time 
of his death.

30 U.S.C. 902(e). The legislative history of the amendment indicates 
that Congress altered the definition of ``widow'' to make it comport 
with the SSA definition:

    The term `widow' in section 402(e) is likewise redefined to 
conform to the Social Security Administration definition.

S. Rep. No. 743, 92nd Cong., 2d Sess. (1972) reprinted in 1972 U.S.C.C. 
& A.N. 2305, 2332. See Wolfe Creek Collieries v. Robinson, 872 F.2d 
1264, 1266-67 (6th Cir. 1989). Consequently, by 1972 both statutes 
provided a full widow's benefit to a surviving spouse and a surviving 
divorced spouse. 42 U.S.C. 402(e).
    Section 412 of the BLBA also supports the payment of full benefits 
to each qualified survivor. That provision states in pertinent part:

    In the case of death of a miner due to pneumoconiosis or, except 
with respect to a claim filed under part C of this subchapter on or 
after the effective date of the Black Lung Amendments of 1981, of a 
miner receiving benefits under this part, benefits shall be paid to 
his widow (if any) at the rate the deceased miner would receive such 
benefits if he were totally disabled.

30 U.S.C. 922(a)(2). A miner, as the primary beneficiary on a claim, is

[[Page 3351]]

clearly entitled to a full basic benefit. 30 U.S.C. 922(a)(1); 20 CFR 
725.520. Upon the miner's death, the ``widow,'' as the primary 
beneficiary, must be compensated in like fashion. Id. Section 902(e) 
defines the term ``widow'' to include both a surviving spouse and a 
surviving divorced spouse. 30 U.S.C. 902(e). Nothing in Sec. 922 
provides for an alternative payment amount if a miner is survived by 
two widows. Consequently, the plain language of the statutory payment 
provisions mandates that both spouses should receive a full (100 
percent) basic benefit amount. 30 U.S.C. 922(a)(2). To utilize any 
other methodology would require payment to each ``widow'' at less than 
the statutorily prescribed ``rate the deceased miner would receive if 
he were totally disabled''. 30 U.S.C. 922(a)(2).
    20 CFR 725.213. Section 725.213(b)(3) is no longer necessary in 
view of the changes made to Sec. 725.204 to confer equal status on the 
spouse and ``deemed spouse''. A new paragraph (c) clarifies 
administrative practice with respect to survivor beneficiaries who 
become ineligible for benefits, but later reestablish eligibility. The 
most common reason for losing eligibility (among surviving spouses) is 
remarriage; if the remarriage ends through death or divorce, the ex-
beneficiary may apply for a return to entitlement. The individual need 
only notify the Office and provide such evidence as may be required to 
reestablish eligibility. The new paragraph also makes clear that the 
individual is not required to reprove the merits of entitlement.
    20 CFR 725.215. Delete paragraph (g)(3)'s reference to ``section'' 
and replace with ``paragraph''. A miner's surviving spouse may meet the 
dependency requirement pursuant to paragraph (g) if the marriage lasted 
at least nine months. If the marriage lasted fewer than nine months, a 
spouse may nevertheless be deemed the miner's dependent if the miner 
dies in an accident or in the line of duty. The purpose of paragraph 
(g)(3) is to preclude a survivor's reliance on the exception to the 
nine-month marriage rule if the adjudication officer concludes that the 
miner would not have lived nine months in any event. Use of the 
technical word ``section'', however, makes the language of the entire 
regulation inapplicable. Consequently, the reference should be changed 
to confine paragraph (g)(3) to its proper context. This change is 
consistent with the structure and meaning of the Social Security 
Administration's parallel regulation for Part B beneficiaries, 20 CFR 
410.360(b).
    20 CFR 725.223. Section 725.223 should be changed to reflect the 
age limit for a disabled dependent currently specified in 42 U.S.C. 
402(d)(1)(B), as incorporated into the BLBA by 30 U.S.C. 922(a)(5). A 
new paragraph (d) clarifies administrative practice with respect to 
sibling beneficiaries who become ineligible for benefits due to 
marriage, but later reestablish eligibility. See the Explanation 
accompanying proposed Sec. 725.209 for changing the onset date for a 
dependent beneficiary's disability. See the Explanation accompanying 
proposed Sec. 725.213(c) for explaining the procedures for the 
restoration of entitlement after termination due to marriage.

Subpart C--Filing of Claims

    20 CFR 725.306(a). The proposed change is intended to ensure that 
another proposed change, in the definition of the term ``benefits,'' 20 
CFR 725.101(a)(6), does not produce unintended consequences in cases 
where a claimant seeks to withdraw a claim. Currently, 
Sec. 725.306(a)(3) prohibits a claimant from withdrawing a claim if he 
has received benefits, defined as payments ``on account of disability 
or death due to pneumoconiosis,'' unless such benefits have been 
repaid. The Department has proposed amending the definition of the term 
``benefits'' to include amounts paid from the Trust Fund to provide the 
claimant with a complete pulmonary evaluation as required by 30 U.S.C. 
923(b). Section 725.306 must also be amended, however, to make clear 
that the Department will not require reimbursement of the amount spent 
on the claimant's complete pulmonary evaluation as a condition for 
withdrawing a claim. The proposed language is similar to language in 20 
CFR 725.465(d), which provides an administrative law judge with the 
authority to dismiss claims for cause only if the Trust Fund is 
reimbursed for any payments made pursuant to 20 CFR 725.522.
    20 CFR 725.309. The Department's current regulation governing the 
processing and adjudication of subsequent or additional claims for 
benefits has been a cause of much litigation. Subsequent claims for 
benefits, often misleadingly referred to as duplicate claims, are those 
applications filed by the same individual after final denial of a prior 
claim. Initially, the litigation dealt with procedural issues. For 
example, in Lukman v. Director, OWCP, 11 Black Lung Rep. (MB) 1-71 
(Ben. Rev. Bd. 1988), rev'd, Lukman v. Director, OWCP, 896 F.2d 1248 
(10th Cir. 1990), the Benefits Review Board held that a claimant was 
not entitled to a hearing before an administrative law judge on the 
issue of whether he had established a material change in conditions, a 
requirement under the current regulations for consideration of the 
merits of a subsequent claim.
    After the Tenth Circuit reversed the Board's decision, subsequent 
claims litigation focused on substantive issues, particularly the type 
of evidence a claimant must submit to establish a ``material change in 
conditions,'' and thereby escape denial of the subsequent claim on the 
grounds of the prior denial. The appellate courts are currently divided 
on this issue. The Seventh Circuit has rejected the Department's 
interpretation of the regulation, holding that the claimant must 
establish that his condition is substantially worse than at the time of 
the prior denial in order to avoid another denial, or that ``even a 
slight worsening could be and was a material change in condition.'' 
Sahara Coal Company v. Director, OWCP, 946 F.2d 554, 558 (7th Cir. 
1991). The Third, Fourth, and Sixth Circuits gave deference to the 
Department's interpretation, Labelle Processing Co. v. Swarrow, 72 F.3d 
308 (3d Cir. 1995); Lisa Lee Mines v. Director, OWCP, 86 F.3d 1358 (4th 
Cir. 1996); Sharondale Corporation v. Ross, 42 F.3d 993 (6th Cir. 
1994), and held that proof of a change in one of the necessary elements 
of entitlement, such as the existence of pneumoconiosis, demonstrates a 
material change in condition. The ALJ must thereafter weigh all of the 
evidence to determine whether the claimant is entitled to benefits. The 
Tenth Circuit recently fashioned yet another interpretation of the 
regulation. Wyoming Fuel Co. v. Director OWCP, ____ F.3d ____, No. 94-
9576 (10th Cir. July 23, 1996).
    This litigation is attributable, in substantial part, to the 
context in which the relevant language was drafted. First proposed on 
April 25, 1978 as part of an extensive revision of the regulations 
governing the processing and adjudication of claims under the Black 
Lung Benefits Act, Sec. 725.309 required that a subsequent claim for 
benefits be denied on the grounds of the prior denial. 43 FR 17743, 
Apr. 25, 1978. The Department received many comments objecting to the 
prohibition against filing a new claim by a miner ``whose condition has 
worsened or progressed to total disability.'' 43 FR 36785, Aug. 18, 
1978. The Department agreed, and, in an effort to remove the 
prohibition, added a clause allowing such claims if ``the deputy 
commissioner determines that there has been a material change in

[[Page 3352]]

conditions.'' Id. The Department did not foresee that this wording 
would cause such confusion.
    At the heart of the current litigation is considerable 
misunderstanding about the extent to which the common law concepts of 
res judicata, or claim preclusion, and collateral estoppel, or issue 
preclusion, apply to the adjudication of black lung benefits claims. 
The proposed regulation is intended to resolve both questions. 
Initially, the Department acknowledges that the principles of claim 
preclusion are applicable to claims under the Act. Pittston Coal Group 
v. Sebben, 488 U.S. 105, 122-23 (1988). That applicability, however, is 
limited in two important respects. First, Sec. 22 of the Longshore and 
Harbor Workers' Compensation Act, 33 U.S.C. 922, as incorporated into 
the Black Lung Benefits Act by 30 U.S.C. 932(a), permits the reopening 
and readjudication of a denied claim within one year of the order 
denying benefits, based on a showing of either a mistake in a 
determination of fact or a change in conditions. This reopening 
provision, commonly called the right to modification, is a 
Congressionally mandated exception to the application of res judicata. 
Second, and more important for purposes of the Department's treatment 
of subsequent claims, claim preclusion bars only an attempt to 
relitigate a cause of action that was previously resolved; it has no 
effect on the litigation of a cause of action which did not exist at 
the time of the initial adjudication. Lawlor v. National Screen Serv. 
Corp., 349 U.S. 322, 328 (1955); ``Restatement (Second) of Judgments'' 
Sec. 24 cmt. f (1982).
    Nowhere is the applicability of this second exception more readily 
understood than in the context of workers' compensation. ``It is almost 
too obvious for comment that res judicata does not apply if the issue 
is claimant's physical condition or degree of disability at two 
entirely different times, particularly in the case of occupational 
diseases.'' 3A Larson, ``The Law of Workmen's Compensation'' 
Sec. 79.92(f) (1982). In light of the Department's longstanding belief 
in the progressive nature of pneumoconiosis (see Explanation 
accompanying Sec. 718.201), the Department believes that the preclusive 
effect of a previous denial of benefits should be limited. Proposed 
paragraph (d)(5) reflects the most readily apparent application of 
claims preclusion. It provides that no benefits are payable, based on a 
subsequent claim, for the period of time which was at issue in the 
prior proceeding. The regulation thus gives full effect to Sec. 22's 
one-year limitation for reopening prior claims based on an allegation 
of a mistake in a determination of fact or a change in conditions.
    The Department's experience in administering the Black Lung 
Benefits Act suggests, however, that the long latency period which 
characterizes pneumoconiosis and the disease's progressive nature do 
provide cause for allowing a claimant to seek benefits by filing a new 
claim more than one year after the denial of a previous claim based on 
a change in conditions. Thus, where the evidence establishes a 
worsening in the miner's physical condition, the proposed regulation 
permits adjudication of a new cause of action based on that worsening. 
This adjudication will address the claimant's condition during a 
completely different, and later, time period.
    The Department recognizes that securing proof of a change in the 
applicable conditions of entitlement may be difficult. As the Seventh 
Circuit recognized in Sahara Coal, ``[t]o require proof that [the 
claimant] was not in fact totally disabled as a result of black lung 
disease, or that the extent of his disease or disability was unclear, 
would complicate the proceeding unduly.'' 946 F.2d at 558. Although the 
Seventh Circuit recognized this difficulty, it nonetheless required the 
claimant to bear a burden of proof that the Department believes is too 
high: ``he should be required to go further and show that he had missed 
the disability threshold the first time so that even a slight worsening 
could be and was a material change in his condition.'' Id.
    The proposed regulation addresses this evidentiary problem, but in 
a manner which recognizes the difficulty inherent in developing medical 
evidence documenting a claimant's medical condition at some time in the 
past. Paragraph (d)(3) thus creates a rebuttable presumption, based on 
a showing that the miner's physical condition has worsened. If the new 
evidence submitted by the parties establishes at least one of the 
applicable conditions of entitlement previously resolved against the 
miner, it is presumed that the miner's physical condition has changed 
since the denial of his earlier claim. For example, the miner may 
establish that his respiratory impairment is now totally disabling, or 
that he has now developed pneumoconiosis. Once invoked, the presumption 
may be rebutted if the party opposed to the claimant's entitlement 
demonstrates that the denial of the prior claim was erroneous as a 
matter of law.
    The Department intends that an operator shall not be entitled to 
rebut the presumption by taking a position contrary to the position it 
adopted in the litigation of the prior claim. For example, where the 
operator argued in the prior claim that the miner was not totally 
disabled due to pneumoconiosis arising out of coal mine employment, it 
may not, in an attempt to rebut the presumption of a change in the 
miner's condition, argue that substantial evidence in the prior claim 
supported a benefit award.
    If the presumption is properly rebutted, the claimant nevertheless 
will be entitled to benefits upon a showing that the miner's physical 
condition, albeit totally disabling earlier, has significantly 
deteriorated since the time of the prior denial. Under the Act, a 
totally disabling respiratory impairment is one which prevents the 
miner from performing his usual coal mine work. Where the miner's usual 
coal mine work required significant physical exertion, a relatively 
small respiratory impairment may be totally disabling. Accordingly, the 
miner's respiratory condition may continue to deteriorate even after it 
reaches the point where it would be considered totally disabling under 
the Act.
    The operator or Fund may also use traditional principles of issue 
preclusion to rebut the presumption. Those principles prohibit the 
relitigation of issues where the party against whom the bar is asserted 
had a full and fair opportunity to litigate the issue in question, and 
resolution of the issue was necessary to the prior judgment. Montana v. 
United States, 440 U.S. 147, 153 (1979); ``Restatement (Second) of 
Judgments'' Sec. 29 (1982). Thus, where the original claim was denied 
solely on the basis that the claimant was not a miner, and the claimant 
has not returned to work, relitigation of that issue will be barred. 
Because a claimant must establish that he worked as a miner in order to 
receive benefits, the subsequent claim must also be denied.
    If the presumption is not rebutted, the fact-finder must consider 
all of the relevant evidence of record, including the old evidence, in 
order to determine whether the claimant is entitled to receive 
benefits. The regulation thus effectuates the position advanced by the 
Department and accepted by the Third Circuit in Labelle Processing, the 
Fourth Circuit in Lisa Lee Mines, and the Sixth Circuit in Sharondale 
Corp. Accordingly, paragraph (d)(1) authorizes the admission into the 
record of any evidence developed in connection with the earlier claim. 
To the extent that the earlier evidence remains relevant to an 
evaluation of the claimant's current

[[Page 3353]]

physical condition, it must be considered by the adjudication officer. 
In addition, both the claimant and the party opposing the claimant's 
entitlement will be able to submit two new pulmonary evaluations or 
consultative reports, in accordance with the limits set forth in 
proposed Sec. 725.414.
    Paragraph (d)(4) recognizes that, once a change in one of the 
applicable conditions has been established, the relitigation of issues 
previously decided is not precluded. The only exceptions are those 
issues to which the parties stipulated and those issues which were not 
contested pursuant to Sec. 725.463. For example, assume that in a prior 
adjudication an administrative law judge found that the claimant was a 
miner but that he did not suffer from pneumoconiosis. The ALJ 
accordingly denied benefits, and the claimant did not appeal. In a 
subsequent claim, the claimant establishes that he now suffers from 
pneumoconiosis, and argues that the operator is precluded from 
relitigating his status as a miner. The claimant is incorrect. Because 
the operator was not aggrieved by the denial of benefits, it could not 
appeal the ALJ's decision to the Benefits Review Board to seek reversal 
of the finding that the claimant was a miner. The operator thus did not 
have a full and fair opportunity to litigate the claimant's status, and 
may not be bound by the prior finding. For the same reason, once a 
claimant establishes a change in an applicable condition of 
entitlement, such as the extent of disability, he is not precluded from 
relitigating any other condition of entitlement, such as the existence 
of pneumoconiosis.
    Although the Department believes that parties must be allowed to 
relitigate issues decided against them in a prior claim as a matter of 
fairness, no such concerns underlie the treatment of uncontested issues 
(see Sec. 725.463) and other stipulations into which the parties 
entered during the adjudication of the prior claim. Where a party's 
waiver of its right to litigate a particular issue represents a knowing 
relinquishment of that right, such waiver should be given the same 
force and effect in subsequent litigation of the same issue.
    The proposed regulation also recognizes that a claimant whose claim 
has been denied may file a new application within one year of an 
earlier denial. Traditionally, such a filing has been considered a 
request for modification, Consolidation Coal Co. v. Worrell, 27 F.3d 
227, 230 (6th Cir. 1994), and the proposed regulation codifies this 
practice. Treating a new application as a modification request is 
advantageous for several reasons. First, because it allows the earlier 
claim to be reopened, a modification request entitles the claimant to 
have his request adjudicated under the entitlement standards in effect 
at the time the original claim was filed. Second, if the claimant 
establishes a mistake in a determination of fact, modification entitles 
him to receive benefits from an earlier date, i.e., either from the 
date on which the medical evidence establishes the onset of total 
disability due to pneumoconiosis, or, if the evidence does not 
establish that date, from the date the original application was filed. 
Eifler v. Office of Workers' Compensation Programs, 926 F.2d 663, 666 
(7th Cir. 1991).
    20 CFR 725.310. Paragraph (b) should be amended to reflect changes 
to the procedural regulations restricting the amount of evidence each 
party to a claim may submit. Proposed Sec. 725.414 limits the parties 
to two pulmonary evaluations or consultative reports in the initial 
adjudication of the claim. This limitation would be easily avoided, 
however, if parties were free to submit whatever additional evidence 
they desired by filing a request for modification. Consequently, the 
proposed regulation places an additional restriction, of one pulmonary 
evaluation or consultative report, on the submission of evidence in 
modification proceedings. See explanation of changes Sec. 725.414.
    Proposed paragraph (c) attempts to reconcile a number of court of 
appeals cases which address the scope of the district director's 
authority to conduct modification proceedings under Sec. 22 of the 
LHWCA, 33 U.S.C. 922, as incorporated by 30 U.S.C. 932(a). Four 
courts--the Seventh, Ninth, Tenth, and Eleventh Circuits--have held 
that a district director lacks the authority to modify a decision 
issued by an administrative law judge. Director, OWCP v. Peabody Coal 
Co., 837 F.2d 295 (7th Cir. 1988); Director, OWCP v. Palmer Coking Coal 
Co., 867 F.2d 552 (9th Cir. 1989); Director, OWCP v. Kaiser Steel 
Corp., 860 F.2d 377 (10th Cir. 1988); Director, OWCP v. Drummond Coal 
Co., 831 F.2d 240 (11th Cir. 1987). In all four cases, the district 
director had initiated modification proceedings in order to correct 
allegedly erroneous determinations imposing liability on the Black Lung 
Disability Trust Fund.
    In contrast, the Fourth and Sixth Circuits have held that 
modification proceedings must be initiated before a district director. 
Saginaw Mining Co. v. Mazzulli, 818 F.2d 1278 (6th Cir. 1987); Lee v. 
Consolidation Coal Co., 843 F.2d 159 (4th Cir. 1988). In both of these 
cases, claimants sought to modify denials of benefits by filing 
requests for modification. In its decision, the Sixth Circuit correctly 
compared the initial stages of modification proceedings to the initial 
stages of a new claims proceeding. 818 F.2d at 1282. During these 
stages the district director may resolve all of the relevant issues, 
provided he has the consent of the parties. Thus, the district director 
may issue a proposed decision and order pursuant to 20 CFR 725.418. If 
no party lodges a timely objection, the proposed decision and order 
will become effective and final. 20 CFR 725.419(d). Thus, where no 
party objects to the proposed action, and the modification proceedings 
were initiated by the claimant or the responsible operator, it is 
unnecessary as well as inefficient to refer the modification request 
for a hearing.
    In reconciling the courts of appeals opinions, the proposed 
regulation distinguishes between cases in which the parties request 
modification, or in which the original adjudication of the claim did 
not proceed beyond the district director, and those in which the 
district director initiates modification proceedings sua sponte 
following an administrative law judge's order. In the first and second 
groups of cases, the district director may issue a proposed decision 
and order or deny the claim by reason of abandonment. Because under the 
proposed regulations a claimant or operator may not request a hearing 
until after issuance of a proposed decision and order, the second 
option contained in current paragraph (c)--forwarding the claim for a 
hearing--has been deleted. In cases in which the district director 
initiates modification proceedings after issuance of an ALJ's decision 
and order, the proposed regulation requires that the case be referred 
to the Office of Administrative Law Judges even if none of the parties 
requests a hearing. Although the Department views the proposed 
distinction as one with little significance, the proposed regulation is 
consistent with the four court of appeals decisions which require such 
a result.
    Paragraph (c) has also been revised to ensure that any party that 
requests reconsideration receives a full and fair adjudication of its 
request. Thus, an administrative law judge may not deny modification on 
the grounds that the party requesting modification has not submitted 
any new evidence. O'Keeffe v. Aerojet-General Shipyards, Inc., 404 U.S. 
249, 256 (1971). In such a case, the administrative law judge is 
obligated to re-weigh all of the existing evidence of record to 
determine whether it establishes that the prior decision is

[[Page 3354]]

based on a mistake in a determination of fact.
    Finally, proposed paragraph (d) addresses the effect of a 
modification decision on previously paid benefits. The Department 
believes that a distinction should be made between awards which are 
overturned on appeal and awards which are modified. Any payments made 
pursuant to an award which is overturned on appeal may be subject to 
recoupment. See 20 CFR part 725, subpart H. Such an award has never 
become final and its tentative nature is therefore apparent to all 
parties. In contrast, the proposed regulation prohibits the recoupment 
of benefit payments made pursuant to an award which is thereafter 
modified. In the Department's view, claimants whose awards have become 
final are entitled to a heightened expectation that they will be able 
to keep the monthly benefits that they receive.
    20 CFR 725.311. Paragraph (c) of current Sec. 725.311 has created 
considerable confusion regarding the due dates for replies and 
responses under the regulations in part 725. The Department does not 
believe that seven additional days should be added to the time periods 
within which to respond to major events in the claims process, such as 
the notification of a potentially liable operator, the notice of 
initial determination, and the proposed decision and order awarding 
benefits. Many of these time periods, none of which is less than 30 
days, may be extended for good cause shown. Consequently, the 
Department does not believe that the 7-day mail rule is necessary, and 
proposes to remove paragraph (c). Additionally, current paragraph (d), 
which the Department proposes to redesignate as paragraph (c), is 
amended to add the birthday of Martin Luther King, Jr., as a legal 
holiday.
    Proposed paragraph (d) addresses an issue which has created a split 
between the Fourth and Tenth Circuits. In Dominion Coal Corp. v. 
Honaker, 33 F.3d 401 (4th Cir. 1994), the Fourth Circuit held that 
where an administrative law judge's decision was not served by 
certified mail as required by the statute, the time period for 
appealing that decision commenced on the date that the aggrieved party 
received actual notice of the decision. The court held that ``[w]hen 
the record establishes actual notice, the purpose of the statutory 
certified mail requirement has been met.'' 33 F.3d at 404. In Big Horn 
Coal Co. v. Director, OWCP, 55 F.3d 545 (10th Cir. 1995), the Tenth 
Circuit reached a contrary conclusion. Although ``[a]llowing the 30-day 
period to start with actual notice would have the salutary effect of 
encouraging finality of administrative judgments when the only defect 
was the procedural one of failing to use certified mail in serving 
th[e] order,'' the court held that there was no provision in the 
statute or regulations which permitted it to reach such a result. 55 
F.3d at 550. In order to resolve this split, and to advance the policy 
considerations cited by both courts, proposed paragraph (d) provides 
that, where an adjudication officer has failed to comply with a 
statutory or regulatory certified mail requirement, but the party has 
received the document, the period for filing any responsive pleading 
shall commence as of the date of receipt.

Subpart D--Adjudication Officers; Parties and Representatives

    20 CFR 725.360. Technical changes to the cross references in 
paragraphs (a)(3) and (c) conform with revisions to Secs. 725.401-.422.
    20 CFR 725.362. The proposed amendment to paragraph (a) makes the 
regulation conform with the requirements of 5 U.S.C. 500(b), which 
allows an attorney to appear on behalf of a party without submitting an 
authorization signed by the party. The requirements for representation 
by any individual who is not an attorney in good standing with his 
state bar remain unchanged. In such circumstances, the Department 
requires an authorization signed by the party. Finally, the requirement 
that any written declaration or notice identify the case by OWCP number 
will allow OWCP to ensure proper and timely filing of the appearance.
    20 CFR 725.367. The current regulation governing an operator's 
payment of a claimant's attorney fee is taken nearly verbatim from 
Sec. 28 of the Longshore and Harbor Workers' Compensation Act, 33 
U.S.C. 928, without recognizing significant differences in the 
procedure for adjudicating claims under the Black Lung Benefits Act. 
Accordingly, its interpretation has caused considerable confusion, 
particularly with respect to the date on which an operator's liability 
for attorney's fees is triggered. See, e.g., Bethenergy Mines v. 
Director, OWCP, 854 F.2d 632 (3d Cir. 1988). In addition, the 
regulation originally sought to shield the Trust Fund from the payment 
of attorney's fees. A series of court decisions, however, held that the 
fund assumes all of the obligations of an operator, including liability 
for the claimant's attorney's fees, in cases where no operator can be 
held liable for the payment of benefits. Director, OWCP v. Black 
Diamond Coal Mining Co., 598 F.2d 945 (5th Cir. 1979); Director, OWCP 
v. South East Coal Co., 598 F.2d 1046 (6th Cir. 1979); Republic Steel 
Corp. v. U.S. Dept. of Labor, 590 F.2d 77 (3d Cir. 1978).
    The proposed regulation seeks to clarify the application of Sec. 28 
of the LHWCA to adjudication under the Black Lung Benefits Act. It also 
provides a non-exclusive list of specific instances in which an 
operator is required to pay attorney's fees and the dates on which the 
operator's liability commences. The proposed regulation also recognizes 
the Trust Fund's liability for attorney's fees, and makes it 
coextensive with that of a liable operator. Specifically, in proposing 
paragraph (a)(2), the Department intends to change the result of the 
decision of the Benefits Review Board in Yokley v. Director, OWCP, 3 
Black Lung Rep. (MB) 1-230 (1981). There, in the absence of a 
regulation specifically addressing the fund's liability for attorney's 
fees, the Board held that the fund became liable for the payment of 
such fees when the district director failed to award benefits within 30 
days of the date on which he learned that there was no potentially 
liable responsible operator. Yokley, 3 Black Lung Rep. at 1-239. The 
Department believes that the event triggering the fund's liability for 
attorney's fees should be identical to the event that triggers an 
operator's liability, i.e., a denial of the claimant's right to 
compensation within the time limits provided by the regulations, which 
creates the adversarial relationship requiring employment of an 
attorney. See Director, OWCP v. Bivens, 757 F.2d 781, 787 (6th Cir. 
1985).

Subpart E--Adjudication of Claims by the District Director

    20 CFR 725.405. The proposed change in paragraph (b) recognizes the 
Department's current practice of refusing to provide a complete 
pulmonary evaluation if the district director concludes, based on the 
initial evidence submitted by the claimant, that the claimant never 
worked as a miner.
    20 CFR 725.406. Section 413(b) of the Act, 30 U.S.C. 923(b), 
guarantees each miner the opportunity to have a complete pulmonary 
evaluation performed, at no expense to the miner, in order to establish 
his entitlement to benefits. Although the existing regulation allows a 
claimant to have this evaluation performed by his own physician, it 
does not address the consequences of that selection. The adequacy of 
the Sec. 413(b) examination and resulting report have been

[[Page 3355]]

frequently litigated. For example, if the report does not address all 
of the elements of entitlement, the Department has been required to 
remedy the deficiency, see, e.g., Cline v. Director, OWCP, 917 F.2d 9, 
11 (8th Cir. 1990), even if the physician who authored the report was 
one of the claimant's choosing. Given the Department's proposal to 
place limits on the amount of evidence submitted by the parties, and 
the importance of the Sec. 413(b) examination, which forms the 
evidentiary basis for the district director's initial finding, the 
Department wishes to explain in greater detail the manner in which it 
will provide the claimant with a complete pulmonary evaluation.
    The proposed regulation clarifies the consequences of a claimant's 
decision to select an alternate physician or facility to conduct his 
complete pulmonary evaluation. First, the claimant must undergo all of 
the testing necessary to produce an examination that meets the 
requirements of Sec. 718.104. If the physician or facility selected by 
the claimant cannot perform all of the tests needed, the Department 
will arrange for the claimant to undergo the additional testing before 
the miner undergoes his examination.
    Second, the Department will determine whether each component of the 
evaluation, including the chest X-ray, the pulmonary function study, 
and the blood gas study, is in substantial compliance with the 
regulatory quality standards. The Department reserves the right to have 
each such test reviewed by a medical consultant in order to assist in 
this determination. However, the Department will only guarantee 
substantial compliance with the quality standards if the testing and 
the resulting report are prepared by a Department-selected physician or 
facility. It has long been the Department's position that, with the 
exception of deficiencies attributable to poor effort on the part of 
the miner, the Department has an affirmative obligation to ensure that 
each test substantially complies with the part 718 quality standards, 
and that the physician provides a documented and reasoned medical 
opinion on each element of entitlement. For example, where the miner's 
blood gas study is non-conforming, or the physician fails to address 
the issue of total disability, or the district director does not find 
the physician's report credible, the Department must either seek 
additional information from the physician or provide the miner with a 
wholly new examination.
    The proposed regulation retains this rule with respect to 
physicians and facilities selected by the Department. With respect to 
physicians and facilities selected by the miner, the regulation 
requires the district director, after determining whether the testing 
complies with the quality standards, to inform the miner and the 
physician or facility of any deficiencies in the report, and allow 
sufficient time to correct such deficiencies. If the deficiencies are 
not corrected, however, the district director is not obligated to take 
any further action. The district director retains the authority to 
order another examination by a physician or medical facility selected 
by the district director.
    Third, proposed Sec. 725.406 specifies that if the miner selects 
the physician, that report will count as one of the two reports which a 
claimant is entitled to submit under the proposed evidentiary 
limitations in Sec. 725.414. If the Department selects the physician, 
the claimant may submit two other reports.
    Finally, the regulation, in combination with changes to 20 CFR 
725.101(a)(6), clarifies the mechanism by which the Department may seek 
recoupment of the cost of the Sec. 413(b) examination from a coal mine 
operator that has been finally determined to be liable for the 
claimant's benefits. Although the current regulation states that the 
Department is entitled to reimbursement, it fails to refer specifically 
to the most appropriate method for recouping amounts owed the Trust 
Fund, 30 U.S.C. 934. Consequently, a clarification is in order.
    20 CFR 725.407. Paragraphs (a) and (c) of the current Sec. 725.407 
have been moved to Sec. 725.406. Paragraph (b), which allowed claimants 
to develop additional evidence prior to the initial finding, has been 
eliminated. Instead, the development by the parties of evidence 
relevant to the miner's entitlement will be governed by 
Secs. 725.413-.414. For an explanation of the proposed text, see the 
explanation of changes to Sec. 725.408.
    20 CFR 725.408. The current Sec. 725.408 has been eliminated. The 
sanctions it provides for a claimant's failure to submit to medical 
examinations are contained in proposed Secs. 725.409 and 725.414. 
Proposed Secs. 725.407 and 725.408 replace the current regulations 
found at 20 CFR 725.412 and 725.413, governing the notification of, and 
response by, potential responsible operators. The proposed changes are 
part of an effort to deal with difficulties that the Department has 
encountered in effectuating Congress's mandate that liability for black 
lung benefits be borne by individual coal mine operators to the maximum 
extent feasible. See Old Ben Coal Co. v. Luker, 826 F.2d 688, 693 (7th 
Cir. 1987). Past difficulties in naming potential responsible operators 
have included: (1) the practice among operators of filing ``blanket'' 
controversions, denying every element of the liability issue, which 
generally are not supported by any evidence and are later withdrawn in 
substantial part; and (2) the tardy submission of evidence relevant to 
operator liability, often only when the claim is pending before the 
Office of Administrative Law Judges. These late evidentiary submissions 
have increased the likelihood of an incorrect responsible operator 
determination by the district director and have led to greater Trust 
Fund liability under the Board's decision in Crabtree v. Bethlehem 
Steel Corp., 7 Black Lung Rep. 1-354 (1984).
    The proposed regulations create a new subclass of operators. Out of 
all of the miner's former employers, one or more operators may be 
designated as ``potentially liable operators.'' The potentially liable 
operator that most recently employed the claimant will generally be the 
responsible operator liable for the payment of benefits. The proposed 
regulation affords the district director considerable flexibility, 
however, in notifying potentially liable operators. If the miner was 
most recently employed for a substantial period of time by a fully 
insured operator, the district director need notify only that operator 
of its potential liability. If the miner's most recent employer had no 
insurance and appears to lack other assets, or employed the miner in a 
capacity which may not be considered coal mine employment, the district 
director may choose to notify more than one potentially liable 
operator. Moreover, the district director may notify such operators 
seriatim; after evaluating the response from the miner's most recent 
employer, or failing to receive any response, the district director may 
notify additional operators.
    The district director's additional flexibility also imposes greater 
responsibility. Unlike the current version of Sec. 725.412(c), the 
proposed standards do not allow a district director to name any 
additional operators after a case has been referred to the Office of 
Administrative Law Judges, in the absence of fraudulent concealment of 
the facts relevant to the identification of the responsible operator. 
Thus, the Department will essentially assume the risk of not notifying 
the ``correct'' responsible operator.
    In order to offset this risk, the regulations require potentially 
liable operators to produce any exculpatory

[[Page 3356]]

documentary evidence while the case is still pending before the 
district director, and thus in sufficient time to allow the district 
director to notify additional operators. Each operator must either 
admit or deny its status as a potentially liable operator, and support 
its denial with specific evidence. It is hoped that this requirement 
will increase the Department's ability to correctly identify the 
responsible operator liable for the payment of benefits. For a 
discussion of the effects of the BLBA and the Administrative Procedure 
Act on the Department's ability to impose time limits on the parties' 
submission of this evidence, see the explanation of changes to 
Sec. 725.414.
    20 CFR 725.409. The proposed revisions add a new basis for denying 
a claim by reason of abandonment and clarify the procedures to be used 
in denying a claim by reason of abandonment. The Department has 
interpreted current Sec. 725.409(a)(3) to include failure to appear at 
an informal conference, and the Fourth Circuit recently confirmed the 
use of that paragraph in Wellmore Coal Co. v. Stiltner, 81 F.3d 490, 
497 (4th Cir. 1996). The proposed addition of paragraph (a)(4) will 
make that authority explicit. A corresponding change has been made to 
Sec. 725.416(c), to provide similar sanctions against a responsible 
operator for its unexcused failure to appear.
    The proposed changes also clarify the procedures for denying claims 
by reason of abandonment. Currently, the regulations allow the claimant 
to undertake a variety of actions in response to an initial notice that 
the claim will be abandoned. The proposed regulation at paragraph (b) 
allows the claimant only two options following the district director's 
initial letter: (1) correct the problem identified by the district 
director; or (2) allow the district director to deny the claim by 
reason of abandonment, and then request a hearing, which will be 
limited to the issue of whether the district director properly 
initiated abandonment proceedings.
    20 CFR 725.410-413. The proposed regulations governing the district 
director's initial adjudication of the claim, Secs. 725.410-.413, 
differ from the current regulations in several respects. In general, 
they provide for a two-track investigation, allowing the district 
director to make a preliminary determination of entitlement while 
concurrently seeking a coal mine operator that may be held liable for 
the payment of the claimant's benefits. It is anticipated that these 
two investigations will culminate in a single document, the initial 
finding. That document will contain a preliminary finding as to the 
claimant's eligibility, based on the complete pulmonary evaluation 
developed in accordance with Sec. 413(b) of the Act, and another 
finding with respect to the potentially liable responsible operator. 
The operator will then be required to accept or contest both findings 
within 30 days of the initial finding's issuance.
    The most important change in these proposed regulations involves 
the claimant's response to a district director's initial finding that 
the claimant is not eligible for benefits. Currently, the claimant is 
allowed 60 days within which to request a hearing or submit new 
evidence. If he submits new evidence, he is given an additional 60 days 
within which to request a hearing. Often, however, the Department 
receives communications from claimants which do not fit neatly into 
either option. The result has been the litigation of various procedural 
issues. See, e.g., Adkins v. Director, OWCP, 878 F.2d 151 (4th Cir. 
1989); Plesh v. Director, OWCP, 71 F.3d 103 (3d Cir. 1995). The 
Department hopes to eliminate such litigation through the proposed 
amendment.
    The proposed regulations therefore address the problems that the 
Department has encountered in applying the current regulations. They 
narrow the claimant's options following an initial finding of non-
eligibility to a single choice, but expand the time period within which 
this option may be exercised. Within one year of an initial finding of 
non-entitlement, the claimant may request further adjudication of the 
claim, but he may not request a hearing at this point. If the claimant 
fails to take any action during the one-year period following an 
initial finding which denies the claim, the denial of the claim will be 
considered effective and final as of the date of the initial finding. 
The one-year period, which incorporates the modification period of 33 
U.S.C. 922 into the initial processing of the claim, reflects the 
Department's experience in administering the program. Miners who truly 
feel that they are disabled will typically request further processing 
of their claim within one month of an initial denial. Others, perhaps 
less sure of whether their condition actually meets the Department's 
total disability due to pneumoconiosis criteria, may wait to determine 
whether their condition worsens. Such miners are entitled to take 
advantage of the one-year period in LHWCA Sec. 22, as incorporated by 
30 U.S.C. 932(a). The proposed regulation accommodates both types of 
claimants, by allowing any response within the one-year period to 
trigger further adjudication of the claim.
    After receiving responses from both parties (or after expiration of 
the time within which a response could be filed), the district director 
will proceed in accordance with those responses. Where a claimant's 
eligibility and the identity of the liable party are uncontested, the 
district director will issue a proposed decision and order. In other 
cases, the district director will issue a schedule for the submission 
of evidence by the parties. For a discussion of the effects of the BLBA 
and the Administrative Procedure Act on the Department's ability to 
impose time limits on the parties' submission of evidence, see the 
explanation of changes to Sec. 725.414.
    20 CFR 725.414. Proposed paragraph 725.414(a) reflects the 
Department's determination that the disparity in financial resources 
available to claimants, as compared to coal mine operators, has created 
an adverse impact on the fair adjudication of claims. Limitations on 
the amount of medical evidence which the parties may proffer are 
therefore necessary in order to restore some measure of balance to the 
process of determining a claimant's entitlement. Accordingly, a new 
regulation is proposed which defines the amount, and type, of medical 
evidence which each party may proffer in support of its position. We 
are specifically seeking comment on the proposed evidentiary 
limitations in Sec. 725.414. This regulation also will require the 
parties to submit their written medical evidence to the district 
director. Generally, once a claim is referred for hearing before an 
administrative law judge, the parties may only elicit oral testimony.
    The Department now has more than 20 years of experience in 
processing and adjudicating black lung benefits claims, and more than 
thirteen years of experience in adjudicating claims under the current 
program regulations. This long history demonstrates claimants' present 
difficulty in establishing their entitlement. Part of that difficulty 
can be attributed to changes in medical criteria and eligibility 
standards imposed by Congress in 1981. Also important, however, are the 
obstacles claimants face when confronted by coal mine operators and 
their insurance carriers as adversaries. Such parties possess economic 
resources far superior to most claimants, which enable them to generate 
medical evidence in such volume that it overwhelms the evidence 
supporting entitlement. The proposed changes to the program regulations 
governing claims adjudication attempt

[[Page 3357]]

to make more equitable the evidentiary development in black lung 
claims.
    When Congress amended the BLBA in 1978 to permit the reopening of 
many thousands of denied claims, it required the claimants' entitlement 
to be judged using liberal interim medical criteria (20 CFR part 727). 
30 U.S.C. 902(f)(2). As a result, claims reopened by the amendments 
enjoyed a 46.0 percent approval rate at the district level. 
(Statistical data reported in ``OWCP FY94 Annual Report to Congress,'' 
Table B-1). Congress also required the Department, in conjunction with 
the National Institute for Occupational Safety and Health (NIOSH), to 
develop permanent ``criteria for all appropriate medical tests * * * 
which accurately reflect total disability in coal miners * * * .'' 30 
U.S.C. 402(f)(1)(D). The Department thereafter promulgated the part 718 
regulations; these criteria apply to all claims filed after March 31, 
1980. For claims filed between the 1978 amendments and the effective 
date of the part 718 regulations, the Department still utilized the 
part 727 criteria. Consequently, the district level approval rate, at 
34.0 percent, was generous. Once the more rigorous part 718 standards 
took effect, however, the approval rate dropped to 10.9 percent for all 
claims filed between April 1, 1980 and December 31, 1981, and 
adjudicated at the district level.
    Congress again amended the BLBA to tighten eligibility requirements 
for claims filed after December 31, 1981. Statutory changes which 
reduced claims approvals included elimination of favorable entitlement 
presumptions and automatic survivor's entitlement upon the death of a 
miner whose claim had been awarded. See 20 CFR 725.1(a), (h). The 
district level approval rate for claims filed after December 1981 was 
5.0 percent as of the end of the 1994 fiscal year. Claimants fared 
little better if they pursued their applications beyond the district 
level by requesting hearings before the Office of Administrative Law 
Judges; the approval rate for such claims during the same period rose 
only to 7.6 percent.
    The dramatically lower approval rates reflect not only the 
statutory changes, but also the increasing percentage of claims in 
which coal mine operators or their insurers, rather than the Black Lung 
Disability Trust Fund, are potentially liable. Their superior economic 
resources simply permit evidentiary development which outweighs the 
evidence claimants can procure. The United States Court of Appeals for 
the Sixth Circuit has commented on this problem:

    This cumulative evidence inquiry also reveals certain policy 
flaws in the adjudication of claims that typically operate to 
disadvantage Black Lung Benefits Act claimants. First, experts hired 
exclusively by either party tend to obfuscate rather than facilitate 
a true evaluation of a claimant's case. Second, when one party is 
able to hire significantly more experts because it has infinitely 
more resources, the truth-seeking function of the administrative 
process is skewed and directly undermined. Third, hiring armies of 
experts often results in needless expense. If such a system 
continues unchecked, justice will not be served, while moneyed 
interests thrive.

Woodward v. Director, OWCP, 991 F.2d 314, 321 (6th Cir. 1993). See also 
Timothy Cogan, ``Is the Doctor Hostile? Obstructive Impairments and the 
Hostility Rule in Federal Black Lung Claims,'' 97 W. Va. L. Rev. 1003, 
1004 fn. 3 (1995). As a possible solution, the Sixth Circuit suggested 
that the administrative law judge prevail upon the parties to accept 
negotiated evidentiary limitations and share the cost of hiring 
physicians.
    The Department believes that the concerns expressed by the Court in 
Woodward are valid. Rather than address those concerns through an ad 
hoc resort to each adjudicator's discretion, however, a ``bright-line'' 
rule of uniform application is preferable. Such a rule imposes a known 
standard of conduct on the parties from the outset, which enables them 
to plan their litigation strategies accordingly. The proposed 
regulation therefore limits each side to two complete pulmonary 
examinations and one ``interpretive'' review (x-ray rereadings, 
clinical test validations, etc.) of each of its opponent's diagnostic 
studies and examinations. This amount of evidence should be sufficient 
to enable each party to advance or defend its position while satisfying 
the demands of ``due process.'' The Commonwealth of Kentucky has 
imposed similar limitations on the evidence submitted in connection 
with claims for workers' compensation. Kentucky Revised Statutes 
Annotated Sec. 342.033 (Michie/Bobbs-Merrill 1993). Limiting evidence 
will also have the salutary effect of reducing the costs associated 
with litigating claims and the amount of repetitive evidence which 
often burdens the record without shedding light on the medical issues.
    The proposed regulation also fundamentally restructures the claims 
adjudication process by focusing evidentiary development at the 
district director level. The regulation requires all parties to develop 
their documentary medical evidence and submit it to the district 
director for consideration. In general, once a claim is referred for a 
hearing before the Office of Administrative Law Judges, no further 
documentary medical evidence will be admitted into the record. Only if 
there are extraordinary circumstances or the pulmonary evaluation 
obtained by the Department is insufficient or incomplete may the 
Administrative Law Judge admit additional documentary medical evidence 
into the record. The Administrative Law Judge will conduct the hearing 
and permit the parties to elicit testimony from witnesses, including 
any physician whose report is in the record. The judge will base his 
decision on the evidentiary record developed by the district director 
and the hearing testimony.
    The foregoing procedure departs from current practice by severely 
limiting the admission of new documentary medical evidence while a 
claim is pending before an Administrative Law Judge. Parties presently 
often reserve the active development of medical evidence until a claim 
is scheduled for hearing. Permitting additional evidentiary development 
before the Administrative Law Judge was logical when significant delays 
occurred between the district director's decision and the hearing 
before the Administrative Law Judge. Given the progressive nature of 
pneumoconiosis, additional evidence was usually necessary for the 
Administrative Law Judge to receive an accurate understanding of the 
miner's health. Such delays no longer occur in a statistically 
significant percentage of claims. Consequently, the practical need for 
permitting evidentiary development at the hearing stage has 
disappeared.
    Litigation strategy, as well as delays, has also encouraged 
operators to defer active participation and evidentiary development 
until claims were referred for hearing. Over time, this practice has 
significantly eroded the ability of the Department to conduct a 
thorough and meaningful initial adjudication of each claim at the 
district level. Because delay is no longer a legitimate consideration, 
the proposed regulation requires full operator participation before the 
district director.
    The Department believes that the fair, efficient and expeditious 
adjudication of claims is a desirable objective which can be promoted 
by limiting the amount of medical evidence developed and encouraging 
all parties to participate actively at the earliest stages of the 
process. The Secretary clearly has the statutory authority to issue 
regulations which achieve this goal. The BLBA provides that ``[t]he 
Secretary of Labor * * * [is] authorized to issue such regulations as 
[he] deems appropriate to

[[Page 3358]]

carry out the provisions of this title.'' 30 U.S.C. 936(a). The 
legislative history of this broad grant of authority ``establishes that 
Congress intended to provide the Secretary adequate flexibility to 
assure the payment of benefits to eligible persons.'' Director, OWCP v. 
National Mines Corp., 554 F.2d 1267, 1274 (4th Cir. 1977) (footnote 
omitted). The Secretary has already issued several regulations 
(discussed below) which address the submission or exclusion of 
evidence. This proposed regulation involves the same matter, and is a 
permissible exercise of the Secretary's statutory authority.
    Moreover, Part C of the BLBA assimilates various provisions of Part 
B of the BLBA and the Social Security Act by means of a circuitous 
series of incorporations by reference. The BLBA states that ``[t]he 
amendments made by the Black Lung Benefits Act of 1972, * * * to Part B 
of [title IV] shall, to the extent appropriate, also apply to part C of 
[title IV].'' 30 U.S.C. 940. Section 923(b), in turn, incorporates 
various provisions of the Social Security Act into Part B. The 1972 
amendments revised Sec. 923(b) to make Sec. 405 of the Social Security 
Act, 42 U.S.C. 405, applicable to Part B. Consequently, Sec. 940 makes 
Sec. 405 of the Social Security Act applicable to Part C via 
Sec. 923(b). Among the incorporated SSA provisions is Sec. 405(a), 
which states as follows:

    The Secretary shall have full power and authority to make rules 
and regulations and to establish procedures, not inconsistent with 
the provisions of this subchapter, which are necessary or 
appropriate to carry out such provisions, and shall adopt reasonable 
and proper rules and regulations to regulate and provide for the 
nature and extent of the proofs and evidence and the method of 
taking and furnishing the same in order to establish the right to 
benefits hereunder.

42 U.S.C. 405(a) (1995 supp.). Section 405(a) contains ``exceptionally 
broad'' authority to prescribe standards for ``proofs and evidence'' in 
disability claims under the SSA. Heckler v. Campbell, 461 U.S. 458, 466 
(1983); see also Schweiker v. Gray Panthers, 453 U.S. 34, 43 (1981). 
Under the aegis of this authority, the Supreme Court has upheld the 
Social Security Administration's use of broad medico-vocational 
guidelines to determine whether a claimant is disabled; the guidelines 
provided an acceptable substitute for resolving classes of issues 
instead of requiring individualized findings in each case concerning 
the claimant's ability to perform work in the national economy. 
Heckler, 461 U.S. at 467. Pursuant to Sec. 405(a), the SSA has also 
validly promulgated a regulation prescribing criteria for weighing 
medical reports from treating physicians (20 CFR 404.1527). Schisler v. 
Sullivan, 3 F.3d 563, 568 (2d Cir. 1993). The proposed regulation is 
designed to regulate the ``nature and extent of the proofs and evidence 
and the method of taking and furnishing'' such evidence for 
adjudicating black lung benefits claims. Its promulgation therefore 
comes within the authority conferred on the Secretary by Congress 
through the incorporation of 42 U.S.C. 405(a) into the BLBA.
    Both individually and together, Secs. 936(a) and 405(a) authorize 
the Secretary to regulate evidentiary development under the BLBA. 
Whether the proposed procedures represent a valid exercise of that 
authority depends on their consistency with the BLBA and the 
Administrative Procedure Act, 5 U.S.C. 551 et seq. (the APA). The BLBA 
is the organic statute; the regulation must therefore be consistent 
with its enabling authority. Hearings under the BLBA must be conducted 
in accordance with the APA. 33 U.S.C. 919(d), as incorporated by 30 
U.S.C. 932(a); 20 CFR 725.452(a). Neither statute prohibits the 
Department from imposing reasonable limitations on evidence.
    Section 923(b) of the BLBA provides that ``all relevant evidence 
shall be considered.'' 30 U.S.C. 923(b). Like Sec. 405 of the Social 
Security Act, this provision applies to Part C via the incorporation 
mechanism of Sec. 940; Congress added the ``all relevant evidence'' 
language to Sec. 923 in the 1972 amendments. Section 940, however, 
contains an important qualifier: the enumerated Part B amendments apply 
only ``to the extent appropriate.'' This phrase confers on the 
Secretary the explicit authority to determine which aspects of Part B 
should be adopted, and to what extent. The proposed regulation 
represents the Secretary's judgment as to the appropriate extent to 
which ``all relevant evidence'' should be admitted for consideration by 
the factfinder. (The Department has not adopted all of the SSA 
provisions incorporated by the 1972 amendments and enumerated in 
Sec. 923(b). For example, Sec. 405(j) contains an elaborate and 
detailed procedure for certifying benefits payments to a representative 
payee rather than the beneficiary; the Department's regulations are 
less comprehensive than the statutory provisions. Compare 42 U.S.C. 
405(j) with 20 CFR 725.510, 725.511. Furthermore, the Department has 
not promulgated regulations which implement the SSA attorney fee or 
criminal penalties provisions. See 42 U.S.C. 406, 408.)
    Read literally and without regard to the remainder of the 
provision, the ``all relevant evidence'' language arguably requires the 
admission for consideration of any evidence which could be relevant to 
the adjudication of a claim. The phrase appears less than clear, 
however, when the remainder of Sec. 923(b) is considered. A literal 
reading infringes on Sec. 923(b)'s incorporation of broad agency 
authority from the Social Security Act to regulate ``the nature and 
extent of the proofs and evidence and the method of taking and 
furnishing the same,'' discussed earlier. Such a reading would 
proscribe the agency from implementing procedures which impose any 
evidentiary controls unrelated to the sole criterion of relevance.
    Section 923(b) itself contains an important limitation on the 
consideration of potentially ``relevant'' evidence by the adjudicator. 
For claims filed before January 1, 1982, the Department is required to 
accept a positive x-ray reading which meets certain requirements. For 
any claim, Sec. 923(b) requires the Department to accept the results of 
an autopsy as to the presence and stage of pneumoconiosis unless fraud 
or accuracy are implicated. Consequently, the Department is precluded 
from submitting (or, as the adjudicator, considering) relevant evidence 
which contradicts the x-rays or autopsies subject to Sec. 923(b). Thus, 
the actual scope of the phrase ``all relevant evidence'' is unclear 
when it is considered in relation to other parts of Sec. 923(b).
    If a literal reading of a statutory provision's language does not 
provide an unambiguous explanation of its intended operation, then 
resort to its legislative history is warranted. See Burlington No. R. 
Co. v. Okla. Tax Comm'n, 481 U.S. 454, 461 (1987). Congress added the 
``all relevant evidence'' language when it amended the BLBA in 1972. 
The amendment represented a reaction to the Social Security 
Administration's heavy reliance on negative x-rays in denying claims, 
and its failure to develop other evidence which might support 
entitlement. See S. Rep. No. 92-743, 92nd Cong., 2nd Sess., at pp. 13-
16 (1972), reprinted in ``Legislative History of the Federal Coal Mine 
Health and Safety Act of 1969,'' Part II--Appendix, at pp. 1958-1961. 
``Every available medical tool should be used to assist a miner in 
successfully pursuing his claim for benefits.'' Id. at 15. Thus, the 
historical context of the language demonstrates that it is a statutory 
exhortation for the agency to explore every avenue which may prove the 
claimant's entitlement. Given the policy behind the provision, its 
apparent breadth should not act as a guarantor for

[[Page 3359]]

the admission of any quantity of evidence an operator might obtain 
which refutes a claimant's entitlement.
    Under the current program regulations, Sec. 923(b) does not 
prohibit the exclusion of certain evidence despite its relevance. For 
example, an operator may not present evidence which conflicts with 
findings made by the district director if the operator fails to make 
certain responses in a timely manner. 20 CFR 725.413(b)(3) (response to 
notice of claim); 725.414(b) (response to initial finding). Any 
documentary evidence which is withheld from the district director must 
be excluded from all future proceedings unless submission is requested 
by another party or ``extraordinary circumstances'' exist. 20 CFR 
725.414(e)(1), 725.456(d). Any party's failure to submit evidence 
within specified time frames, failure to provide proper notification of 
an expert witness' hearing appearance, or failure to appear at a 
hearing without permission, are also grounds for limiting or excluding 
evidence. 20 CFR 725.456(b)(2), 725.457(a), 725.461(b). None of these 
exclusionary regulations permits relevance to excuse the infraction.
    Many of the foregoing procedures were ``intended to expedite the 
claims process, eliminate surprise, and require the parties to 
undertake a timely development of their positions.'' 43 FR 36798, Aug. 
18, 1978, Sec. 725.456, Discussion and changes (a). In promulgating 
these regulations in 1978, the Department concluded that ``[n]either 
the act, nor the Administrative Procedure Act, to the extent that it is 
incorporated, prohibits the Department from designing rules which 
diminish the element of surprise from black lung claims procedures.'' 
43 FR 36794, Aug. 18, 1978, Sec. 725.414, Discussion and changes (a). 
The proposed regulation also satisfies valid policy considerations by 
limiting evidentiary development in the interests of a fairer and more 
balanced adjudication process. It encourages the expeditious and timely 
development of the parties' positions by focusing much of that 
development at the district level. Consequently, the regulation 
promotes the same policy goals as some of the current regulations in 
excluding or limiting the admission of otherwise relevant evidence.
    The proposed regulation also affects the conduct of formal hearings 
by administrative law judges, which are governed by the APA. 5 U.S.C. 
554(a). Section 556(d) provides in pertinent part:

    * * * Any oral or documentary evidence may be received, but the 
agency as a matter of policy shall provide for the exclusion of 
irrelevant, immaterial, or unduly repetitious evidence. * * * A 
party is entitled to present his case or defense by oral or 
documentary evidence, to submit rebuttal evidence, and to conduct 
such cross-examination as may be required for a full and true 
disclosure of the facts.

5 U.S.C. 556(d). The proposed regulation obviously limits the literal 
language of Sec. 556(d), which permits receipt of ``any * * * 
documentary evidence.'' The documentary evidence which the ALJ 
generally may receive under this proposal would consist of the record 
compiled and transmitted by the district director; that record itself 
would be limited in quantity to a certain amount of documentary medical 
evidence submitted by each party. To the extent that the regulation 
departs from Sec. 556(d), the Department believes that the Secretary 
has the authority to promulgate regulations which vary the APA's 
hearing requirements.
    Section 956 of the Mine Safety and Health Act states that, 
``[e]xcept as otherwise provided in this chapter, the provisions of 
sections 551 to 559 * * * of Title 5 shall not apply to the making of 
any order, notice, or decision made pursuant to this chapter, or to any 
proceeding for the review thereof.'' 30 U.S.C. 956. ``This chapter'' is 
a reference to chapter 22 of Title 30, United States Code, which 
codifies the Mine Safety and Health Act. The BLBA is subchapter IV of 
that Act. Section 956 therefore exempts application of the APA to the 
BLBA unless ``otherwise provided in this chapter.''
    Section 932(a) of the BLBA incorporates by negative reference 
Sec. 919 of the LHWCA, which in turn requires hearings to be conducted 
in accordance with the APA. Section 932(a), however, also provides the 
Secretary with the authority to depart from the terms of the 
incorporated provisions of the LHWCA. Specifically, portions of the 
LHWCA apply to Part C of the BLBA ``except as otherwise provided * * * 
by regulations of the Secretary.'' 30 U.S.C. 932(a). Section 919 of the 
LHWCA is the vehicle by which the APA applies, since Sec. 956 generally 
exempts title 30, United States Code, from the APA. By regulation, 
therefore, the Secretary can ``otherwise provide'' the extent to which 
the incorporated provision of the LHWCA makes the APA applicable. The 
proposed regulation provides the guidelines and limitations for 
developing evidence in connection with the adjudication of a claim for 
benefits before the administrative law judge. Consequently, to the 
extent the regulation departs from the APA, that departure is 
``otherwise provided'' by part 725. The Department adopted this 
position in Director, OWCP v. Greenwich Collieries, Inc., 114 S.Ct. 
2251 (1994), as a basis for supporting the ``true doubt'' rule. The 
Court did not reach the merits of this argument because it held that 
the regulation at issue was too broad to overcome a presumption that 
the APA hearing procedures applied. 114 S.Ct. at 2254.
    In any event, the proposed regulation is consistent with the 
objective behind the allowance for the receipt of ``any'' evidence. In 
``The Attorney General's Manual on the Administrative Procedure Act'' 
at 76 (1947), reprinted in ``Federal Administrative Procedure 
Sourcebook'' 51, 125 (1985), the following discussion occurs:

    Under section [556(d)] it is clear that, as heretofore, the 
technical rules of evidence will not be applicable to administrative 
hearings. [Citation omitted.] Thus, it is stated that ``the mere 
admission of evidence is not to be taken as prejudicial error (there 
being no lay jury to be protected from improper influence) although 
irrelevant, immaterial, and unduly repetitious evidence is useless 
and is to be excluded as a matter of efficiency and good practice.'' 
[Citation omitted.]

    This gloss suggests that Sec. 556(d) cannot be read as a literal 
directive to admit all evidence any party may proffer unless the 
evidence is ``irrelevant, immaterial or unduly repetitious.'' Rather, 
the purpose of the admission/exclusion language is to eliminate 
technical evidentiary rules as grounds for assigning error to the 
liberal admission of evidence. A general policy favoring the admission 
of evidence over its exclusion on technical grounds does not thereby 
preclude an agency from determining in the first instance what 
evidence, and how much, may be admitted as ``relevant'' and 
``material''. To interpret Sec. 556(d) otherwise would effectively read 
out of the BLBA the broad authority contained in provisions like 
Sec. 405(a) to regulate the evidence used to establish entitlement to 
benefits. The APA is modeled on the hearing procedures contained in 
Sec. 205(b) of the Social Security Act, and ``the social security 
administrative procedure does not vary from that prescribed by the 
APA.'' Richardson v. Perales, 402 U.S. 389, 409 (1971), citing ``Final 
Report of the Attorney General's Committee on Administrative 
Procedure,'' contained in S. Doc. No. 8, 77th Cong., 1st Sess., 157 
(1941).
    Finally, no aspect of the proposed regulation impinges on any of 
the procedural rights afforded parties by Sec. 556(d). ``The matter 
comes down to the question of the procedure's integrity

[[Page 3360]]

and fundamental fairness.'' Richardson, 402 U.S. at 410. The APA 
permits the submission of documentary evidence, but it does not 
prescribe the juncture in the process when that evidence must be 
developed. Consequently, requiring the parties to submit all medical 
evidence to the district director is consistent with the right to 
submit that evidence to the administrative law judge for de novo 
consideration. The regulation simply eliminates the bifurcated 
evidentiary development permitted by current practice.
    The APA also affords the right to an oral hearing, the presentation 
of testimonial and rebuttal evidence, and the cross-examination of 
witnesses; the regulation preserves all of these rights.
    Evidentiary limitations seem especially apt in the context of black 
lung claims litigation. The medical issues are clearly defined by 
statute and regulation, and limited in nature since they involve only 
the individual miner's condition. Each party should therefore be able 
to obtain a comprehensive review of the miner's respiratory condition 
which supports its position. As long as each party has the right to 
rebut the opposing party's case, to subpoena and cross-examine opposing 
medical witnesses, and present its case, upon request, to an 
administrative law judge, then the requirements of the APA and due 
process are satisfied.
    As discussed above, the Black Lung Benefits Act vests the Secretary 
with broad authority to manage the adjudication of claims for black 
lung benefits. That management is particularly difficult, however, in 
cases which require adjudication of both the claimant's eligibility and 
the liability of one of the claimant's previous employers. The 
Department's goals are to: (1) provide a forum for the full and fair 
adjudication of both eligibility and liability; (2) ensure that 
potentially eligible claimants are put into interim pay status as 
quickly as possible; (3) limit the number of physically demanding and 
often invasive pulmonary evaluations that a claimant has to undergo in 
the evaluation of his entitlement; and (4) protect the Black Lung 
Disability Trust Fund by fulfilling Congress' intent that liability for 
black lung claims be borne by coal mine operators to the maximum extent 
feasible.
    Reconciling these interests in cases involving multiple potentially 
liable responsible operators has not been easy. Such cases typically 
arise where there is a dispute over whether the miner's most recent 
employer: (a) is a coal mine operator; (b) employed the claimant as a 
miner; and (c) is financially capable of assuming liability. In 
Crabtree v. Bethlehem Steel Corp., 7 Black Lung Rep. 1-354 (1984), the 
Benefits Review Board held that the Department was not entitled to a 
remand to name another responsible operator after the claimant had 
established his entitlement to benefits and the administrative law 
judge correctly dismissed the responsible operator initially designated 
by the Director. Such a remand, the Board held, would require the 
claimant to relitigate his entitlement. Instead, the Board instructed 
the Director to resolve the liability issue in a preliminary proceeding 
or proceed against all potential responsible operators at each stage of 
the adjudication. Although the Sixth Circuit has declined to apply 
Crabtree in a case in which the Director designated a new responsible 
operator before the claimant had to litigate his entitlement to 
benefits, Director, OWCP v. Oglebay Norton Co., 877 F.2d 1300, 1304 
(6th Cir. 1989), the Fourth Circuit has explicitly endorsed the Board's 
decision in the context where the claimant has already litigated and 
established his eligibility. Director, OWCP v. Trace Fork Coal Co., 67 
F.3d 503, 508 (4th Cir. 1995).
    Absent statutory amendment, however, the Department cannot simply 
resolve a disputed responsible operator determination before 
adjudicating the claimant's entitlement. Even if an operator aggrieved 
by the Director's initial decision that if the responsible operator 
were able to litigate the issue before the Office of Administrative Law 
Judges and the Benefits Review Board, the federal courts of appeals 
will not hear appeals from liability decisions prior to adjudication of 
the merits of the claimant's entitlement. Youghiogheny & Ohio Coal Co. 
v. Baker, 815 F.2d 422, 424-5 (6th Cir. 1987).
    In changing the current system, then, the Department has two basic 
choices: (a) name a single potentially liable responsible operator; or 
(b) name multiple responsible operators (either all of the miner's 
former employers or enough of them to ensure that one will likely be 
held liable). The risk of the first option falls solely on the Trust 
Fund. Since the district director has only one opportunity to designate 
a responsible operator, the Trust Fund assumes the risk that the 
district director's initial identification may be incorrect.
    The second option, however, may have a considerable negative impact 
on claimants if each responsible operator is allowed to develop medical 
evidence with respect to the claimant's eligibility. Obviously, the 
claimant in such a case would be subject to multiple physical 
examinations. In addition, such a system would increase the chances 
that the claimant's eligibility will be decided based on the sheer mass 
of evidence which multiple operators are capable of developing. For 
example, in Martinez v. Clayton Coal Co. et al., 10 Black Lung Rep. 
(MB) 1-24 (1987), the claimant faced three potentially liable 
responsible operators. The ALJ denied benefits and the claimant 
appealed, arguing that the ALJ erred in failing to resolve the 
liability issue prior to adjudicating the claimant's eligibility. The 
claimant also argued that the ALJ erred in admitting a medical opinion 
submitted by one of the three operators (presumably not the operator 
subsequently found liable for benefits). The Board rejected claimant's 
contention, holding that any potentially liable operator may submit 
evidence at the hearing bearing on the claimant's eligibility. If the 
Department were to apply this practice to all cases in which there was 
a legitimate liability dispute, it would widen the disparity in 
resources between the claimant and those with an interest in disproving 
the miner's eligibility.
    Accordingly, the Department has selected a variant of this second 
method. Although the Department may have notified several potentially 
liable operators in a case pursuant to Sec. 725.407, in most cases, the 
identity of the potential responsible operator will be clear. Thus, 
after the submission of responses to the district director's initial 
finding, the district director will dismiss all of the other 
potentially liable operators. In such cases, the potential risk to the 
Trust Fund of an incorrect responsible operator identification is 
small, and it is one that the Department is willing to assume, 
especially when weighed against the effect of multiple operator 
participation in the litigation of the claimant's eligibility.
    In cases involving more difficult liability issues (e.g., those 
involving successor operators, undercapitalized partnerships, atypical 
coal mine operators, etc.), however, the Department will continue to 
retain more than one potentially liable operator as parties to the 
case, in order to preserve its right to compel the payment of benefits 
by the responsible operator ultimately determined to be liable for 
benefit payments. To ensure that the claimant is not overwhelmed by 
operator-developed medical evidence, however, the proposed regulations 
limit all potentially liable operators to a cumulative total of two 
pulmonary evaluations or two consultative reports as an affirmative 
case. See discussion, above. Because all of the potentially

[[Page 3361]]

liable operators have an identical interest with respect to the 
eligibility issue, the Department does not believe that any unfairness 
will result from limiting the total evidence submitted. In effect, the 
responsible operator, as initially found by the district director, 
serves as ``lead counsel,'' developing a single response on behalf of 
those opposed to the claimant's entitlement. The regulations further 
provide an escape clause, allowing a potentially liable operator who is 
not the responsible operator to request permission to obtain its own 
examination upon a showing that the responsible operator is not fully 
litigating the case.
    20 CFR 725.415, .418. The proposed changes complement the 
Department's efforts to strengthen the integrity of adjudication at the 
district director level. Previously, parties were entitled to request 
hearings before the Office of Administrative Law Judges at any point 
during the initial processing of the claim. See Plesh v. Director, 
OWCP, 71 F.3d 103, 111 (3d Cir. 1995). The proposed regulations remove 
that option; instead, in each case the district director will issue a 
proposed decision and order awarding or denying benefits. Only after 
such a decision has been issued may a party request that the case be 
referred to the Office of Administrative Law Judges for a formal 
hearing. In accordance with that change, the proposed regulations also 
remove the district director's authority to forward the case to the 
Office of Administrative Law Judges prior to issuing a proposed 
decision and order.
    20 CFR 725.416. As the Fourth Circuit has recently recognized, 
``informal conferences serve several useful purposes, all of which 
would be undermined if a party could refuse to participate.'' Wellmore 
Coal Co. v. Stiltner, 81 F.3d 490, 495-96 (1996). Those purposes 
include narrowing issues, achieving stipulations, and crystallizing 
positions. Consequently, the Department proposes to modify Sec. 725.416 
to clearly provide for the imposition of sanctions on any party that 
fails to appear at a scheduled informal conference and whose absence is 
not excused. A party's belief that the conference will serve no 
function does not justify the party's absence. The proposed regulation 
further puts all parties on notice that those attending the conference 
will be deemed to have authority to stipulate to issues and/or resolve 
the entire claim. The current regulations simply provide that those 
attending ``must have'' such authority.
    20 CFR 725.417. Paragraph (b) of this regulation is revised to 
conform to the limitations on evidence established in proposed 
Sec. 725.414.
    20 CFR 725.421. The Department has determined that the maintenance 
of case files while a request for a hearing is pending is a function 
which the district offices should perform. Currently, once a request 
for hearing is received and the case is referred to the Office of 
Administrative Law Judges, the OWCP administrative file is sent to the 
national office of the Division of Coal Mine Workers' Compensation for 
Maintenance. The deletion of language in paragraph (a) indicates the 
Department's intention to alter current procedure.
    20 CFR 725.423. The Department's current regulations allow many of 
the time limits applicable to the processing and adjudication of claims 
to be extended for good cause. The proposed regulations are intended to 
be similarly flexible. Proposed Sec. 725.423 is intended to govern all 
such time periods, and to clarify when a party must request an 
extension. Two time periods are exempted from this general rule. No 
purpose would be served by including the one-year time limit for a 
claimant to respond to an initial finding of non-entitlement. Since the 
one-year period is long in any event and any response within that 
period is sufficient to trigger further adjudication of the claim, the 
Department sees no need to provide for an extension of that time.
    In addition, the 30-day time period for responding to a proposed 
decision and order may not be extended. This time limit is 
jurisdictional, see Freeman United Coal Mining Co. v. Benefits Review 
Board, 942 F.2d 415, 422 (7th Cir. 1991), and is not subject to 
extension.

Subpart F--Hearings

    20 CFR 725.451. A cross-reference to Sec. 725.419 is included to 
emphasize that the hearing request must be timely in order to be 
honored.
    20 CFR 725.452. A proposed paragraph (d) imposes on the 
administrative law judge the duty to inform parties in writing if he 
believes that a hearing is unnecessary, and afford a reasonable period 
for objections. A response by even one party requesting that an oral 
hearing be held in order to present testimonial evidence is sufficient 
to compel the hearing.
    20 CFR 725.454. Proposed Sec. 725.414(d) prohibits the introduction 
of any evidence after a claim is referred for a hearing except upon a 
showing of extraordinary circumstances or in the event a Department-
obtained Sec. 413(b) examination is not complete or fails to comply 
with the applicable quality standards. Section 725.454 should therefore 
be changed accordingly. Proposed Sec. 725.414 imposes severe 
constraints upon the development of evidence at the hearing stage. For 
example, documentary medical evidence which has not been submitted to 
the district director cannot be made a part of the record before the 
administrative law judge except upon a showing of ``extraordinary 
circumstances''. Consequently, the authority to reopen the record for 
the receipt of additional evidence for ``good cause'' in the current 
regulation must be eliminated. The conditions under which an 
administrative law judge may receive additional documentary medical 
evidence are described in proposed Sec. 725.456.
    20 CFR 725.456. Proposed Sec. 725.414 imposes significant 
constraints on the development of documentary evidence, and especially 
documentary medical evidence. The parties will be required to develop 
the documentary record at the district director level; no additional 
documentary evidence will be admitted at the hearing unless the 
proffering party establishes extraordinary circumstances or a 
Department-provided pulmonary evaluation is not complete or is of 
insufficient quality. Consequently, in most cases, the record which is 
transmitted to the administrative law judge pursuant to Sec. 725.421 
will be the record upon which the administrative law judge adjudicates 
the claim; the only additional evidence will be provided by hearing 
witnesses. Only if the administrative law judge concludes that 
extraordinary circumstances exist or that the record developed by the 
parties is incomplete or insufficient to decide the claim, may he 
remand the claim to the district director with instructions to obtain 
additional evidence on specific issues, or allow the parties to develop 
such additional evidence as is necessary.
    The purpose of proposed Secs. 725.414 and 725.456 is to force the 
parties to develop the documentary record at the district level, the 
earliest adjudicatory stage, and confine the hearing to the 
presentation of testimonial evidence. This procedure supplants the 
current system, which effectively bifurcates evidentiary development by 
permitting the parties to postpone obtaining evidence until the 
hearing. Currently, each party attempts to have the most recent medical 
opinions or tests admitted into the record, resulting in the last-
minute submission of evidence. Consequently, the introduction of 
evidence often does not cease until after the hearing because the 
parties receive additional time in which to obtain

[[Page 3362]]

rebuttal evidence. The proposed procedure eliminates this form of 
maneuvering, and its attendant delays, by eliminating the incentive and 
opportunity to delay evidentiary development. The right to a hearing 
will become the right to request de novo review of the record by the 
administrative law judge, as supplemented by whatever testimony the 
parties present. Even the medical testimony will be limited to doctors 
who have authored reports which are part of the record.
    The proposed regulation also provides some flexibility in 
permitting additional documentary evidence to be offered at the hearing 
stage. If ``extraordinary circumstances'' occur, then a party may be 
permitted to submit additional evidence. We are specifically seeking 
comment on the ``extraordinary circumstances'' provision of proposed 
Sec. 725.456. We do not contemplate, for example, that the worsening of 
a miner's physical condition, no matter how severe, would establish the 
existence of extraordinary circumstances, so as to warrant 
supplementing the evidentiary record. Such a change is properly 
addressed through the modification procedures set forth at Sec. 725.310 
which allow the submission of an additional pulmonary evaluation or 
consultative report. As another example, however, extraordinary 
circumstances might be found in the following case. Suppose that a 
miner with an eighth grade education attempts, without success, to 
retain counsel at the district director level and can document that he 
contacted at least 20 attorneys in his attempt. Proceeding without 
counsel before the district director, he submits into evidence only one 
medical report from his treating physician which does not address all 
of the elements of entitlement, but merely concludes that the miner is 
totally disabled. After the case is referred to the Office of 
Administrative Law Judges, claimant is finally successful in retaining 
counsel who requests that the claimant's evidence be supplemented with 
an additional and more detailed report from his treating physician.
    Similarly, a potentially liable operator that neglects to undertake 
the timely development of evidence while the case is pending before the 
district director may not take advantage of the ``extraordinary 
circumstances'' exception, whether or not that neglect may be 
considered excusable. See Doss v. Director, OWCP, 53 F.3d 654, 658 (4th 
Cir. 1995) (holding that a party which inadvertently withholds evidence 
developed before the district director does not meet the 
``extraordinary circumstances'' exception of the current version of 
Sec. 725.456(d)). To take another example, however, assume that a 
potentially liable operator diligently attempts to develop evidence in 
order to demonstrate it is not the operator that most recently employed 
the miner. Due to fraudulent concealment on the part of the miner's 
most recent employer, however, the potentially liable operator is 
unsuccessful in obtaining such evidence until after the claim is 
referred to the Office of Administrative Law Judges. In such a case, 
the evidence may be admissible under the ``extraordinary 
circumstances'' provision of the proposed rule.
    In other instances, the evidence may simply be incomplete or 
inadequate to permit a proper adjudication of the claim. Ordinarily, a 
party who fails to develop its evidence fully simply loses. The main 
exception is the Department's obligation to provide each miner with a 
complete pulmonary examination. See 30 U.S.C. 923(b); 20 CFR 725.406. A 
claim cannot be denied if the Department has failed to obtain such an 
examination and the remaining evidence, if any, does not credibly 
address all the entitlement issues. In such cases, the proposed 
regulation retains the current regulation's procedure for authorizing 
the administrative law judge to remand the case for additional 
development or allow the parties additional time to develop the 
evidence. Other than these two narrow exceptions, the proposed 
regulation does not contemplate the admission of additional documentary 
evidence once the claim has been referred to the Office of 
Administrative Law Judges.
    20 CFR 725.457. Proposed Sec. 725.414(c) requires the parties to 
notify the district director of the names and addresses of any 
potential hearing witnesses who have not prepared documentary evidence 
in the record. Proposed paragraph (c) conforms Sec. 725.457 to this 
procedure. Paragraph (c)(3) addresses the possibility that the 
administrative law judge may admit additional documentary evidence 
pursuant to Sec. 725.456. In that event, the person who prepared the 
evidence will be permitted to testify even though he had not previously 
been identified as a potential witness at the district level. Proposed 
paragraph (d) addresses the scope of a medical witness' testimony. If 
the witness prepared documentary medical evidence, he is restricted to 
testifying to the contents of that document. Although paragraph (c)(2) 
permits a party to identify potential witnesses for the hearing who 
have not prepared documentary evidence, paragraph (d) makes clear that 
a physician cannot be a witness unless he prepares a report in 
evidence. A physician is permitted to testify only as to the clinical 
testing, examination results and diagnoses contained in his report. 
This limitation is intended to foreclose the use of a physician at the 
hearing to review the reports and testing of all the other physicians 
in evidence, and thereby exceed the number of consultative reviews 
permitted by the regulations.
    20 CFR 725.458. The proposed new language is intended to clarify 
that any physician who testifies by deposition is subject to the same 
limitations on the scope of his testimony as any physician who 
testifies at the hearing before the administrative law judge. This 
limitation ensures that a party cannot use a deposition to elicit 
testimony which would otherwise be barred if procured at the hearing.
    20 CFR 725.459. Current paragraph (a) imposes the liability for the 
cost of compelling a witness to appear at a hearing on the party who 
desires to cross-examine the witness. The first sentence of current 
paragraph (b), however, effectively excuses the claimant from bearing 
the cost of compelling a witness to appear for the claimant to cross-
examine. The conflict is resolved by deleting the first sentence of 
paragraph (b). Regardless of the party's affiliation or status, the 
party who compels another party to produce a witness for purposes of 
cross-examination must bear the cost of the witness' appearance. 
Obviously, if the witness will appear in any event to testify on behalf 
of a party, exercising the right of cross-examination will not shift 
the liability for costs from the proponent of the witness to the other 
party.
    The remainder of the regulation is restructured and consolidated. 
References to the Black Lung Disability Trust Fund are included in 
recognition of the Fund's liability for fees and costs when no operator 
is liable.
    20 CFR 725.466. The reference to Sec. 725.477 in paragraph (a) is a 
typographical error. This paragraph directs the mode of service for an 
order of dismissal. Section 725.477, however, concerns the form and 
content of a decision and order, not its service on the parties. 
Section 725.478 is the correct regulation for purposes of setting 
criteria for service of an order.
    20 CFR 725.478. To date, the Department has interpreted 
Sec. 725.478 to make the date an administrative law judge issues a 
decision the date that it is filed in the office of the district 
director for purpose of Sec. 19(e) of the

[[Page 3363]]

Longshore and Harbor Workers' Compensation Act, 33 U.S.C. 919(e), as 
incorporated by 30 U.S.C. 932(a). This position is based on the same-
day linkage between issuance of the decision and return of the official 
record to the DCMWC, at which time it is ``considered'' filed. Three 
courts of appeals and the Benefits Review Board, however, have rejected 
this interpretation. Director, OWCP v. Seals, 942 F.2d 986 (6th Cir. 
1991); Daugherty v. Director, OWCP, 897 F.2d 740 (4th Cir. 1990); Trent 
Coal, Inc. v. Day, 739 F.2d 116 (3d Cir. 1984); Harris v. NAACO Mining, 
12 Black Lung Rep. 1-115 (1989). These decisions interpret Sec. 725.478 
as merely indicating where the official record should be housed once 
the administrative law judge issues a decision. They also hold that the 
30-day period for challenging a decision does not commence until the 
decision is actually filed with the district director. The Department's 
interpretation has been rejected as improperly shortening a statutorily 
prescribed time period for appeal. Although the Department does not 
agree with the judicial gloss put on Sec. 725.478, the regulation is 
amended to conform to the caselaw by making explicit that DCMWC's 
actual receipt of the record triggers the running of the 30 days.
    In addition, the last two sentences of this regulation require the 
district director to compute all benefits payable by an operator 
following the issuance of an administrative law judge's decision and 
order. Because the same computations must be performed following any 
effective order awarding benefits, whether by the district director, 
administrative law judge, Benefits Review Board, or court, this 
requirement will be moved to Sec. 725.502, contained in subpart H, 
``Payment of Benefits.''
    20 CFR 725.479. Proposed paragraph (d) is added to make clear that 
improper or defective service will not stay the commencement of the 30-
day period for appeal or reconsideration if the party has actually 
received the decision. Actual receipt imposes on the party a duty to 
act which cannot be mitigated by the error(s) in serving the decision. 
See generally Dominion Coal Co. v. Honaker, 33 F.3d 401 (4th Cir. 
1994).
    20 CFR 725.480. Delete ``(a)'' because section 725.480 contains 
only one provision.

Subpart G--Responsible Coal Mine Operators

    20 CFR 725.490. The regulations governing the obligations of coal 
mine operators to secure the payment of benefits have been moved to 
part 726, Black Lung Benefits; Requirements for Coal Mine Operator's 
Insurance. Subpart G henceforth will govern only the adjudication of 
issues of operator liability.
    20 CFR 725.491-.495. The material in current Sec. 725.494 will be 
moved to Sec. 725.606. The material in current Sec. 725.495 will be 
moved to part 726. Sections 725.491-.495 will be amended to effectuate 
Congress's intent that coal mine operators bear liability to the 
maximum extent feasible. The Black Lung Benefits Act contains three 
substantive provisions relevant to the potential liability of 
individual coal mine operators. Section 3(d) of the Federal Mine Safety 
and Health Act, 30 U.S.C. 802(d), provides that the term `` `operator' 
means any owner, lessee, or other person who operates, controls, or 
supervises a coal or other mine or any independent contractor 
performing services or construction at such mine.'' Section 422(b) of 
the Act, 30 U.S.C. 932(b), further provides that ``an employer, other 
than an operator of a coal mine'' shall be liable for benefits payable 
to ``any employee of such employer to the extent such employee is 
engaged in the transportation of coal or in coal mine construction.'' 
Finally, Sec. 422(i), 30 U.S.C. 932(i), provides criteria for assessing 
liability against successor operators.
    Beyond these general rules, however, the Department's authority to 
impose liability on coal mine operators is extraordinarily broad. 
Section 422(h), 30 U.S.C. 932(h), directs the Secretary to promulgate 
regulations to ``establish standards, which may include appropriate 
presumptions, for determining whether pneumoconiosis arose out of 
employment in a particular coal mine or mines,'' and to ``establish 
standards for apportioning liability for benefits * * * among more than 
one operator, where such apportionment is appropriate.'' Since it began 
administering the black lung benefits program in 1973, the Department 
has consistently sought to impose liability on the operator that most 
recently employed the miner, provided certain other conditions are met. 
These other conditions currently include: (1) the operator employed the 
miner for at least one year; (2) at least one day of such employment 
took place after December 31, 1969; and (3) the operator is financially 
capable of assuming liability for the payment of the claimant's 
benefits. 20 CFR 725.493(a)(1), 725.492 (a)(3), (a)(4). These 
regulatory requirements for the imposition of liability have withstood 
constitutional scrutiny by a three-judge panel of the United States 
District Court for the District of Columbia and the Supreme Court. 
National Independent Coal Operator's Association v. Brennan, 372 F. 
Supp. 16 (D.D.C.), aff'd, 419 U.S. 955 (1974).
    Although the Department does not intend to alter these fundamental 
requirements, some change is needed in order to address problems that 
have arisen in litigation. For example, and perhaps most importantly, 
the Fourth Circuit has recognized that ``[t]he Black Lung Benefits Act 
and its accompanying regulations do not specifically address who has 
the burden of proving the responsible operator issue.'' Director, OWCP 
v. Trace Fork Coal Co., 67 F.3d 503, 507 (1995).
    The proposed regulations are intended to clarify and amplify the 
Department's method of identifying responsible operators and assign 
appropriate burdens of proof. Sections 725.491 and 725.492 are derived 
from the specific statutory provisions defining the terms ``operator'' 
and ``successor operator,'' respectively. In effect, they identify the 
class of business entities that may be considered ``operators'' in any 
claim filed under the Act. The regulations construe the Act broadly, 
see Donovan v. McKee, 845 F.2d 70, 72 (4th Cir. 1988), in order both to 
recognize all of the various businesses which mine coal in the United 
States and to give full effect to Congress' intent that the coal mining 
industry bear liability for individual claims to the maximum extent 
feasible. S. Rep. 95-209, reprinted in Comm. on Education and Labor, 
House of Representatives, 96th Cong., ``Black Lung Benefits Reform Act 
and Black Lung Benefits Revenue Act of 1977'' (Comm. Print) at 612.
    Proposed paragraph (c) of Sec. 725.491 broadly defines the term 
``independent contractor.'' An independent contractor will incur 
liability for black lung benefits, however, only if one of its 
employees is engaged in a function covered by the Act at a covered 
situs for a cumulative period of at least one year. See proposed 
Secs. 725.495(a)(1), 725.494(c). Although this one-year requirement 
will generally ensure that the independent contractor will have had 
more than de minimis contact with coal mining, there may be cases in 
which an independent contractor's contacts with mining have been 
limited. For example, a maintenance worker employed by an independent 
contractor who visited a coal mine once a week for five years to repair 
machinery integral to the extraction of coal would be considered to 
have been a miner for a cumulative period of more than one year under 
the Department's

[[Page 3364]]

regulations. See proposed Sec. 725.101(a)(32). In such a case, the 
regulations require that the independent contractor that employed the 
miner be considered an operator for purposes of black lung liability.
    The Department thus agrees with the decision of the District of 
Columbia Circuit in Otis Elevator Co. v. Secretary of Labor, 921 F.2d 
1285 (D.C. Cir. 1990). In Otis Elevator, a case involving the mine 
safety provisions of the Federal Mine Safety and Health Act, the court 
held that the statutory definition of the term ``operator,'' 30 U.S.C. 
802(d), was not limited to independent contractors with a continuing 
presence at a mine. The court noted that the statutory definition was 
clear and unambiguous, and contained no such requirement. The 
``continuing presence'' test had been adopted by the Fourth Circuit in 
another FMSHA case, Old Dominion Power Co. v. Donovan, 772 F.2d 92 (4th 
Cir. 1985). To the extent that a black lung benefits claim presents 
this issue, the Department believes the ``continuing presence'' test 
should not be applied outside the Fourth Circuit.
    Proposed Sec. 725.492 largely tracks Sec. 422(i) of the Act and 
provisions contained in current Sec. 725.493. The proposed regulation 
is intended to clarify both the criteria for successor operator 
liability, and the priority for assigning liability in cases where 
there is more than one successor operator. As a general rule, the 
regulations impose liability on the operator that actually employed the 
miner most recently. Where that operator is no longer financially 
capable of assuming liability for the claimant's benefits, typically 
because the operator is no longer in existence and failed to purchase 
commercial insurance to secure the payment of benefits, liability 
follows the most recent purchaser of the employer's mining business. If 
neither the original employer nor any successor operator which bought 
the business can be held liable for benefits, the parent company of the 
original employer may be held liable. The proposed regulation also 
broadly defines the term ``acquisition'' to recognize any transfer of 
authority over a mine, no matter how it is effected. For example, the 
purchase of a coal mine operator's assets from a bankruptcy trustee, or 
the transfer of a coal mine from one member of a family to another, 
with or without consideration, will both be considered acquisitions for 
purposes of imposing successor operator liability.
    The proposed regulations also define the entities which may engage 
the miner in an employment relationship. Only an operator that employed 
the miner for at least one year, and for at least one day after 
December 31, 1969, may be considered liable for that miner's benefits. 
Section 725.493 broadly defines the necessary relationship. It may be a 
traditional one, involving the payment of a wage or salary and actual 
day-to-day control over the work performed, or a deemed relationship, 
such as that involving a successor operator, lessor, or parent 
corporation.
    Proposed Sec. 725.494 uses the miner's employment relationships to 
define a subclass of operators called potentially liable operators, 
i.e., those operators whose relationship with the miner was of 
sufficient duration and type to justify the imposition of liability 
against them, and whose financial capability allows them to assume such 
liability. All of the criteria for identifying a potentially liable 
operator are contained in the current regulations: proposed paragraphs 
(a), (b), (d), and (e) are found in current Sec. 725.492; and proposed 
paragraph (c) is contained in current Sec. 725.493.
    Paragraph (e) has been altered to provide more specific standards 
for establishing an operator's financial capability to assume liability 
for the payment of a claimant's benefits. The financial capability 
criterion has always been of the utmost importance, but has been the 
subject of increasing litigation in recent years. See, e.g., Director, 
OWCP v. Trace Fork Coal Co., 67 F.3d 503 (4th Cir. 1995). Like the 
current regulation, the proposed regulation recognizes three methods of 
establishing an operator's financial capability: (1) A commercial 
insurance policy covering the claim; (2) authorization to self-insure; 
and (3) the possession of assets sufficient to guarantee the payment of 
the claimant's benefits.
    The proposed regulation makes only minor changes to the first two 
methods in order to guarantee that the commercial insurance or the 
security posted by a self-insured operator remain viable sources of 
benefit payments. Thus, where the operator purchased commercial 
insurance, the regulation requires that the insurance company must be 
solvent, or that a legally obligated successor must exist. Where the 
insurance company has been declared insolvent, and no successor (either 
another insurance company or a state guaranty association) is available 
to pay benefits, the operator's prior purchase of insurance is not 
sufficient to establish the operator's ability to assume liability. 
Instead, the operator itself must possess sufficient assets to secure 
the payment of benefits. Similarly, where the operator was authorized 
to self-insure, the operator itself must still be authorized to self-
insure or the security posted by that operator must be sufficient to 
provide for the payment of benefits.
    With respect to the third method, the current regulations contain a 
presumption that if an operator is in existence, it is presumed to be 
financially capable of assuming liability for benefits. On occasion, 
that presumption has required the assessment of liability against a 
coal mine operator that is in existence, but that, because of the small 
size of its assets, clearly cannot pay benefits to a miner, even where 
a financially capable operator is next in line to assume liability. In 
such a case, the award of benefits is effectively unenforceable against 
the operator, and the Trust Fund must assume liability.
    The proposed regulation replaces the presumption with a more case-
specific inquiry into the operator's actual financial status by tying a 
determination of financial capability based on the operator's assets to 
the requirements of proposed Sec. 725.606. In the case of operators who 
are in violation of their statutory duty to secure the payment of 
benefits, Sec. 725.606 requires a minimum deposit of $175,000 to secure 
the payment of benefits on a claim. In the case of coal mine 
construction or coal transportation employers, the regulation requires 
a more particularized assessment of the benefits payable in a given 
claim based on the life expectancies of the miner and his dependents.
    The size of the pool of potentially liable operators in any given 
case will vary depending on the miner's employment history. If the 
miner spent the last thirty years working for a single coal company 
that either insured its liability under the Act or qualified as a self-
insurer, that company will be designated the responsible operator. If 
the miner worked for a number of companies, some of which thereafter 
sold their coal mining business, the number of potentially liable 
operators will be larger.
    Finally, Sec. 725.495 concludes the identification process by 
setting forth criteria for determining which of the potentially liable 
operators will be the responsible operator. The proposed regulation 
also assigns burdens of proof to the respective parties to the claim, 
thereby addressing the problem the Fourth Circuit identified in Trace 
Fork. Proposed Sec. 725.495 alters the current regulation 
(Sec. 725.493) in two important respects. First, it makes explicit 
OWCP's system for determining responsible operator liability. It 
provides that if more than one potentially liable

[[Page 3365]]

operator exists with respect to the miner's most recent employment, the 
miner's actual employer shall be primarily liable, followed, in order, 
by any potentially liable successor operator and any other operator 
that may be deemed to have employed the miner. Only if no potentially 
liable operator exists with respect to the miner's most recent 
employment does the regulation authorize looking to the miner's next 
most recent employment.
    For example, assume that the miner was employed by Megalith Coal 
Company from 1968 through 1982, and then went to work for Bob's Steel 
Company (which operated its own coal mines) until 1985. At the time, 
Bob's was insured by Shaky Insurance Company. Bob's subsequently sold 
its mines to Bill's Coal Company and merged into Ace Steel Company. The 
regulation requires that the miner's most recent employer bear the 
liability if at all possible. The regulation would therefore prioritize 
liability as follows: (1) Bob's Steel Company (as insured by Shaky 
Insurance Company, provided the insurer is still solvent); (2) Bill's 
Coal Company; and (3) Ace Steel Company. If none of these companies has 
the financial capability to pay benefits, the regulation assigns 
liability to Megalith Coal Company.
    Second, proposed Sec. 725.495 allocates the parties' burdens of 
proof with respect to determining the responsible operator. Pursuant to 
paragraph (b), the Director bears the burden of establishing that the 
responsible operator named by the district director in the initial 
finding (the ``designated responsible operator'') meets all of the 
Sec. 725.494 criteria for a potentially liable operator with the 
exception of financial capability, which is presumed. Where the 
operator failed to contest its designation as a potentially liable 
operator before the district director, see proposed Sec. 725.408(a)(3), 
none of the Sec. 725.494 requirements may be contested. Pursuant to 
paragraph (d) of proposed Sec. 725.495, where the designated 
responsible operator is not the miner's most recent employer, the 
Director is required to place into the record a statement that OWCP has 
searched its insurance and self-insurance records, and has found no 
record that any more recent employer meets the conditions of paragraphs 
725.494 (e)(1) or (e)(2).
    Once the Director meets his burden, the burden shifts to the 
designated responsible operator. That operator must prove either that 
it does not have sufficient assets to secure its liability and 
therefore is not financially capable, or that a more recent employer 
meets all of the requirements for a potentially liable operator set 
forth in proposed Sec. 725.494. As part of this burden, the designated 
responsible operator must demonstrate that the more recent employer, or 
its owners or officers, if appropriate, possesses assets sufficient to 
secure the payment of benefits in accordance with Sec. 725.606. The 
Department must be able to reach those assets through the enforcement 
mechanisms provided by the Act. For example, proof that the owner of a 
sole proprietorship possesses assets that may not be divided, such as a 
jointly owned residence, will not meet the designated responsible 
operator's burden. If the designated responsible operator meets its 
burden, then the more recent employer, if it was notified of the claim 
pursuant to proposed Sec. 725.407 and not thereafter dismissed, shall 
be considered the responsible operator. If the designated responsible 
operator meets its burden and the more recent employer is not a party 
to the claim, then liability will be borne by the Black Lung Disability 
Trust Fund.

Subpart H--Payment of Benefits

    20 CFR 725.502, .522, .530. Determining the point in time at which 
benefits become due under the Black Lung Benefits Act is important for 
several purposes. For example, once an administrative law judge issues 
a decision and order awarding benefits against a responsible coal mine 
operator, the Trust Fund may pay benefits on an interim basis only 
after the operator fails to pay benefits that become due and payable. 
See 26 U.S.C. 9501(d)(1)(A)(ii). In addition, a beneficiary will be 
entitled to additional compensation, equal to twenty percent of any 
unpaid benefits, only if the operator fails to make payments within 10 
days of the date on which they become due. See 20 CFR 725.607. Finally, 
the date on which benefits become due determines the starting point for 
computing any interest owed the beneficiary. See 20 CFR 725.608. The 
current regulations, however, offer little help in determining this 
critical date.
    The proposed changes, which are consistent with OWCP's current 
practice, generally reflect law developed under the Longshore and 
Harbor Workers' Compensation Act. Under the Longshore Act, benefits 
become due when the compensation order becomes effective. See Tidelands 
Marine Serv. v. Patterson, 719 F.2d 126, 127 n.1 (5th Cir. 1983); 
Lazarus v. Chevron USA, Inc., 958 F.2d 1297, 1299 (5th Cir. 1992). 
Section 21(a) of the LHWCA, 33 U.S.C. 921(a), as incorporated into the 
BLBA by 30 U.S.C. 932(a), provides that a compensation order issued 
under Sec. 19 of the LHWCA, whether by a district director or an 
administrative law judge, see 20 CFR 702.315, .349, .350, becomes 
effective when it is filed in the office of the district director. The 
Secretary's black lung regulation at 20 CFR 725.479 uses the same 
language with respect to orders issued by administrative law judges. 
The regulations also allow a district director to issue a compensation 
order, but provide that such an order will become effective only if no 
party requests a hearing within 30 days. 20 CFR 725.419(d); see Freeman 
United Coal Mining Co. v. Benefits Review Board, 942 F.2d 415 (7th Cir. 
1991). Proposed Sec. 725.502(a)(2) will provide all parties with notice 
as to these crucial dates. Although appellate tribunals such as the 
Benefits Review Board and the courts of appeals typically direct the 
entry of an award on remand rather than enter an award themselves, the 
proposed regulation also addresses those rare instances in which the 
Board or court does issue such an award.
    With one exception, the Department's experience in administering 
the Black Lung Benefits Act does not justify altering the Longshore Act 
procedures with respect to when benefits are payable. Thus, once an 
effective order is issued, an operator must immediately commence the 
payment of monthly benefits that become due thereafter in accordance 
with the terms of the order. Failure to pay these benefits within 10 
days of the date they become due will subject the operator to liability 
for additional compensation.
    The exception to Longshore Act practice concerns retroactive 
benefits payable by an operator after an effective order is issued. 
Such benefits are typically payable in two cases: (1) in a case in 
which the claimant was receiving interim benefit payments from the 
Trust Fund, where the claimant is entitled to benefits for periods 
prior to the initial determination of the claimant's eligibility; and 
(2) where the claimant was not receiving any interim benefit payments 
prior to the effective order because the district director had 
initially determined that the claimant was not entitled to benefits.
    Because the calculation of retroactive benefits often involves the 
consideration of factors that are not apparent in the record or the 
decision, such as the dates of previous interim payments by the Trust 
Fund, the Department believes that such a calculation is best performed 
by the district director. Under the current regulations, such 
calculations are made within 30 days of the date of the effective 
award, and the proposed

[[Page 3366]]

regulation at Sec. 725.502(b)(2) codifies that time period.
    For example, an administrative law judge may issue an order on 
August 15, 1996, awarding benefits as of August, 1994. This decision is 
effective when correctly filed and served, and the operator must 
commence monthly benefit payments within 10 days of the next date upon 
which monthly benefits become due, i.e., it must pay benefits due for 
the month of August by September 10, 1996. If the operator fails to 
make timely payment, it will incur liability for twenty percent 
additional compensation. Retroactive benefits, however, covering the 
period from August, 1994 through July, 1996, will not be due until the 
district director completes the computation of these amounts and 
notifies the parties, notification which will be completed within 30 
days of August 15, 1996.
    Currently, some operators and insurers pay monthly benefits 
following the issuance of an effective award, but few pay retroactive 
benefits while an appeal is pending. By clarifying the respective 
obligations of the district director and the operator in a case in 
which an award is issued, and by providing claimants with notice of the 
dates on which benefit payments may be expected and the consequences of 
an operator's failing to make those payments, the Department hopes to 
increase operator compliance with effective awards.
    20 CFR 725.503. As currently written, Sec. 725.503 does not provide 
any guidance for determining when benefits should commence if the 
claimant prevails in modification proceedings. A denied claim may be 
modified to an award if the claimant establishes either a factual 
mistake in the decision denying the claim, or a change in the miner's 
condition since that denial. 33 U.S.C. 922, as incorporated by 30 
U.S.C. 932(a); as implemented by 20 CFR 725.310. See generally O'Keeffe 
v. Aerojet-General Shipyards, Inc., 404 U.S. 254, 255-256 (1971); Banks 
v. Chicago Grain Trimmers Assn., Inc., 390 U.S. 459, 465 (1968). A 
``mistake'' determination requires the adjudicator to consider whether 
the original decision is premised on some significant factual error 
resulting in an improper denial of the claim. In order to prove a 
change in condition, the claimant must prove that his condition has 
deteriorated to the point of compensable disability since the prior 
denial of the claim; this inquiry effectively acknowledges the 
correctness of the earlier decision, and requires the claimant to 
proffer new evidence.
    The differences in the two grounds for modification necessarily 
require different means for determining the commencement date for 
benefits.

    A change in condition--a worsening of the applicant's black lung 
disease to the point where it is now totally disabling--entitles him 
to benefits from the date of the change. The correction of a mistake 
of fact, showing that he had totally disabling black lung disease at 
the time of the original hearing, entitles him to benefits from the 
date--which might be long before that hearing--on which he became 
totally disabled.

Eifler v. Office of Workers' Compensation Programs, 926 F.2d 663, 666 
(7th Cir. 1991).
    Proposed paragraph (d) implements the alternative modification 
grounds characterized by Eifler. If the basis for modifying the denial 
of benefits to an award is a mistake in that denial, a determination of 
the commencement date uses the same rules as apply to claims. The 
adjudicator must consider whether a miner (paragraph (b)) or a survivor 
(paragraph (c)) filed the claim, and weigh the evidence accordingly. 
If, however, the claimant has established a change in condition, a 
different method must be used. The Department has concluded that the 
most reasonable alternative is to use the earliest credible evidence 
supportive of an element of entitlement previously resolved against the 
claimant (or left unresolved), provided such evidence was obtained 
since the denial of the claim. Such evidence supports both the award 
and a finding of the date from which benefits are payable if the 
adjudicator has considered and rejected any later evidence refuting 
entitlement. Cf. Rochester & Pittsburgh Coal Co. v. Krecota, 868 F.2d 
600, 603 (3d Cir. 1989) (holding that administrative law judge 
erroneously awarded benefits from 1977 filing date when all medical 
evidence until 1985 was negative).
    Proposed Sec. 725.503 is also amended to reduce the number of 
provisions dealing with part 727 awards. Section 727.302 provides the 
criteria for determining when benefits are payable under part 727, 
which makes most of the current references to part 727 in Sec. 725.503 
unnecessary. 20 CFR 727.302. The only exception is for ``transition 
claims,'' filed between July 1, 1973, and December 31, 1973, under 
Sec. 415 of the BLBA, 30 U.S.C. 925. Section 727.302(e), which governs 
the onset date for such claims, refers to Sec. 725.503 for the 
applicable standards. Thus, proposed Sec. 725.503(e) is necessary to 
supply applicable standards. No benefits on a Sec. 415 claim can be 
awarded for any period of eligibility occurring prior to January 1, 
1974. 20 CFR 727.303(a). Consequently, a cross-reference to 
Sec. 727.303 is a necessary qualifier to making onset date 
determinations under Sec. 725.503 for Sec. 415 claims.
    20 CFR 725.537. Proposed Sec. 725.212(b) codifies the Department's 
position that full survivor's benefits must be paid to each surviving 
spouse or surviving divorced spouse who establishes eligibility. In 
order to eliminate any potential inconsistency between the proposed 
regulation and current Sec. 725.537, the latter must be amended to 
cross-reference the new Sec. 725.212(b).
    20 CFR 725.547. The Black Lung Benefits Act incorporates by 
reference certain provisions of the Social Security Act which require a 
claimant who has received benefits to which he is not entitled (an 
``overpayment'') to reimburse the benefits unless certain defined 
exceptions apply. 30 U.S.C. 923(b), 940, incorporating 42 U.S.C. 
404(b). The claimant is entitled to waiver of the overpayment recovery 
if he can demonstrate that permitting recovery would ``defeat the 
purpose of the Act'' or ``be against equity and good conscience.'' Only 
those individuals who were not ``at fault'' in creating the 
overpayments are eligible for waiver.
    Section 725.547(a) currently limits the availability of waiver to 
those individuals who received the overpayments from the Black Lung 
Disability Trust Fund. A claimant who received an overpayment from a 
responsible operator or an insurance carrier may not seek waiver. The 
Department has concluded that the waiver provisions should be available 
to all claimants. Deleting the second sentence of paragraph (a) will 
afford any individual who has received an overpayment the opportunity 
to establish that he is without fault in creating the overpayment, that 
he lacks the financial resources to repay the overpayment (``defeat the 
purpose of title IV of the Act'') or that special circumstances exist 
which demand release from liability (``be against equity and good 
conscience''). See 20 CFR 725.542-725.543.
    The Department recognizes that incorporated provisions from the 
Longshore and Harbor Workers' Compensation Act (LHWCA) permit 
recoupment only by withholding future benefits. See 33 U.S.C. 914(j), 
922, as incorporated by 30 U.S.C. 932(a); Ceres Gulf v. Cooper, 957 
F.2d 1199, 1206-07 (5th Cir. 1992); Stevedoring Services of American, 
Inc. v. Eggert, 953 F.2d 552, 557 (9th Cir. 1992). If no future 
benefits are due, then the overpayment cannot be recovered under that 
statutory

[[Page 3367]]

scheme. The Department has concluded, however, that the LHWCA 
provisions should not be generally applied to black lung overpayments. 
The statutory authority incorporated from the Social Security Act 
imposes an affirmative duty on the Department to recover overpayments 
unless waiver is appropriate: ``Whenever the Secretary finds that more 
* * * than the correct amount of payment has been made to any person * 
* *, proper adjustment or recovery shall be made * * *'' 42 U.S.C. 
404(a)(1). Since 1973, the Department has promulgated regulations 
consistent with the SSA provisions. See 38 FR 26042 et seq., Sept. 17, 
1973; 20 CFR 725.523, 725.524 (1978) (identical to present 725.542, 
725.543). Those courts which have reviewed the Department's position 
have upheld its authority to collect overpayments even when no future 
benefits are due. Napier v. Director, OWCP, 999 F.2d 1032 (6th Cir. 
1993); McConnell v. Director, OWCP, 993 F.2d 1454 (10th Cir. 1993); 
compare Bracher v. Director, OWCP, 14 F.3d 1157, 1160-61 (7th Cir. 
1994) (acknowledging difference between SSA and LHWCA statutory schemes 
and the Secretary's authority to promulgate regulations which vary 
incorporated provisions from LHWCA). Departing from the current 
procedures obviously would result in adverse financial consequences for 
the debt-laden Trust Fund. Moreover, the current procedures ensure that 
recovery is made only from those individuals who were either at fault 
in creating the overpayment or possess the financial resources to repay 
the benefits. For these reasons, the Department has adopted the LHWCA 
limitations on overpayment recovery only for overpayments which occur 
as a result of modification proceedings. See 33 U.S.C. 922, as 
incorporated by 30 U.S.C. 932(a); 20 CFR 725.310(d). See explanation of 
changes to Sec. 725.310.

Subpart I--Enforcement of Liability; Reports

    20 CFR 725.606. The current regulation at Sec. 725.494 implements 
Sec. 422(b) of the Act, 30 U.S.C. 932(b), which provides that coal mine 
construction and transportation employers are not required to comply 
with the general requirement that coal mine operators secure their 
potential liability under the BLBA. Section 422(b) further provides, 
however, that the Secretary may require a coal mine construction or 
transportation employer to ``secure a bond or otherwise guarantee the 
payment'' of benefits to an employee that the Secretary has determined 
to be eligible for benefits. The current regulation at Sec. 725.606 
implements Sec. 14(i) of the Longshore and Harbor Workers' Compensation 
Act, 33 U.S.C. 914(i), which generally gives the district director 
authority to require the deposit of money with the United States 
Treasurer whenever he deems it advisable.
    The proposed changes consolidate the two current regulations into a 
single one dealing generally with post-award security. The new 
regulation will be located in subpart I, ``Enforcement of Liability; 
Reports.'' The new regulation eliminates paragraph (a) of Sec. 725.494, 
which simply repeats the security requirement of the Act and refers to 
20 CFR part 726. Because this provision is discussed in considerable 
detail in part 726, no useful purpose is served by repeating it in part 
725. The remainder of Sec. 725.494 is integrated into Sec. 725.606. The 
latter section now establishes a clear duty on the part of otherwise 
unsecured operators to secure individual claims following issuance of 
an effective award of benefits. The new regulation also provides a 
mechanism for enforcing the duty to secure these benefit payments. 
Finally, there is currently no mechanism by which the United States 
Treasurer can hold deposits that are to be used to pay monthly 
benefits. Accordingly, the Department has altered the incorporated 
Longshore Act provision to provide authority to require a deposit of 
negotiable securities with a Federal Reserve Bank. See 30 U.S.C. 932(a) 
(authorizing the Department to depart from incorporated Longshore Act 
provisions in order to facilitate the administration of the Black Lung 
Benefits Act).
    The new regulation distinguishes between the obligations of coal 
mine operators that were required to secure the payment of benefits 
under the Act and failed to meet that obligation, and those coal mine 
construction and transportation employers that were not required to 
secure. The former are required to deposit at least $175,000 (the 
current average value of a claim) for each approved claim. This amount 
may be increased if OWCP believes that additional security is required 
because, for example, the miner is relatively young, or has a disabled 
child. In cases in which the miner's age and the number of his 
dependents would not justify the entire $175,000, that money will 
provide additional security for claims filed by other employees of the 
unsecured operator. On the other hand, because coal mine construction 
and transportation employers have not violated the Act's security 
requirement, they are entitled to a more precise calculation of their 
potential liability for the approved claim, and may not be required to 
secure other claims not yet awarded.
    Consideration was given to imposing a mandatory duty on uninsured 
operators and coal mine construction or transportation employers to 
secure benefit payments immediately following the issuance of an 
effective award of benefits, without awaiting a specific directive from 
the district director. Section 725.494 currently provides that a coal 
mine construction or transportation employer ``which may be liable for 
the payment of benefits under this part or Part 727 of this subchapter 
shall take such action as may be appropriate to guarantee the discharge 
of such liability.'' Determining the amount of security required in the 
case of a coal mine construction or transportation employer, however, 
requires an individualized calculation by OWCP. A coal mine 
construction or transportation employer cannot be expected to perform 
such a calculation without assistance. Accordingly, the regulation 
requires that OWCP request such an employer to secure the payment of 
benefits before an order can be issued. Such a request will also give 
the liable operator or other employer an opportunity to demonstrate its 
compliance with the security requirement.
    The regulation places the initial burden on OWCP. Once an effective 
award is issued, the district office (which will receive a copy of all 
such awards) will contact the Responsible Operator section of OWCP's 
Branch of Standards, Regulations, and Procedures, to determine whether 
the liable party has secured its obligations. If it has not, the 
district director will inform the operator of its obligation to secure 
the claim. If the operator fails to comply, the district director may 
direct the deposit of appropriate securities or, if the claim was 
awarded by an administrative law judge, the Benefits Review Board, or a 
court of appeals, request the appropriate Regional Solicitor's office 
to file a motion with the administrative law judge. This system will 
encourage district offices to investigate an operator's existing 
security, request the posting of security in appropriate cases, and to 
take whatever steps are necessary to require the posting of such 
security, as quickly as possible.
    Paragraph (g) represents the Department's interpretation of the 
interplay between Sec. 432(b), which excuses coal mine construction and 
transportation employers from the Act's general security requirement, 
and

[[Page 3368]]

Sec. 433(d), which imposes personal liability for benefits on the 
president, secretary, and treasurer of an incorporated operator that 
fails to secure the payment of benefits. Paragraph (g) makes clear that 
the provisions of Sec. 433(d) will apply to incorporated coal mine 
construction and transportation employers if they fail to comply with 
an order requiring post-award security.
    20 CFR 725.608. The proposed changes are intended to simplify the 
regulation, and to allow all parties to a claim to ascertain their 
obligations and rights with respect to the payment of interest. In 
general, the purpose of interest is ``to ensure that an injured party 
is fully compensated for its loss.'' City of Milwaukee v. Cement 
Division, National Gypsum Co., 115 S. Ct. 2091, 2095 (1995). The Black 
Lung Benefits Amendments of 1981 amended the Act to provide that an 
operator that withholds the payment of retroactive benefits pending 
review of an initial determination of eligibility shall begin to accrue 
liability for interest 30 days after the initial determination. 30 
U.S.C. 932(d). The initial determination serves as the first notice to 
an operator that it may have incurred a potential obligation to pay 
benefits, and the statute and regulations recognize that the 
computation of interest from an earlier point in time may not be 
equitable. See Stapleton v. Westmoreland Coal Co., 785 F.2d 424, 438 n. 
12 (4th Cir. 1986) (en banc), rev'd on other grounds sub. nom. Mullins 
Coal Co. v. Director, OWCP, 484 U.S. 135 (1987). Proposed paragraph 
(a)(3) applies the same rule governing liability for interest to 
medical benefits, an issue which the present regulation does not 
address.
    Paragraph (b) of the current regulation is unchanged. As the courts 
have recognized, the language of this provision is broad enough to 
entitle the Department to interest on any benefits paid from the Trust 
Fund, including both monthly disability benefits and medical treatment 
expenses. Reich v. Youghiogheny & Ohio Coal Co., 66 F.3d 111, 117 (6th 
Cir. 1995).
    In proposed paragraph (c), the Department recognizes that delays in 
the payment of attorney's fees under the Act have contributed to the 
unwillingness of attorneys in many areas of the country to accept black 
lung benefits cases. Under an incorporated provision of the Longshore 
and Harbor Workers' Compensation Act, attorneys may receive 
compensation only if they are successful, and only after the award of 
the claimant's benefits becomes final. 33 U.S.C. 928, as incorporated 
by 30 U.S.C. 932(a). Because an award of benefits may not become final 
until years after the attorney's fee application has been approved by 
the adjudication officer, the value of the fee that the attorney 
ultimately receives will be reduced by intervening inflation. Although 
the BLDTF may not pay interest, see 26 U.S.C. 9501(d), the Department 
believes that awarding interest on fee awards in responsible operator 
cases, the majority of cases currently litigated, will encourage 
attorneys to represent black lung claimants by reducing the cost of 
adjudicatory delays. This position is also consistent with Supreme 
Court precedent, Missouri v. Jenkins, 491 U.S. 274 (1989).
    20 CFR 725.609. Several of the Department's recent enforcement 
cases have involved responsible operators or insurers that became 
financially incapable of paying benefits after having fully litigated 
the merits of the claimant's entitlement. As a result, although the 
final award is directed against one entity, the Department must seek to 
enforce the award against another. The Act currently provides ample 
authority for such enforcement. See, e.g., 30 U.S.C. 932(i). In Donovan 
v. McKee, 845 F.2d 70, 72 (4th Cir. 1988), the Fourth Circuit refused 
to sanction ``a license for operators to avoid benefit payments by 
effecting convenient changes of the business form under which coal 
mining operations are conducted. There is no warrant in the statutory 
language or purpose for allowing operators to resort to such shell game 
maneuvers to avoid liability for paying black lung benefits.'' 
Obviously, requiring the Department and the award beneficiary to obtain 
a new order in accordance with the claims procedure outlined in part 
725 would allow such operators to delay indefinitely the enforcement of 
their obligations by undergoing frequent changes in identity. In 
addition, such an approach would have the unfortunate result of 
requiring claimants to relitigate their entitlement to benefits.
    Even if the change in the operator's identity is wholly unrelated 
to a desire to avoid liability for black lung benefits, the Act should 
be construed to effectuate Congress's stated intent to impose liability 
for benefits payable under Part C of the Act on individual coal mine 
operators. In recognizing the expansive scope of the Act's provisions 
relating to the industry's liability, and the broad authority vested in 
the Department to carry out the provisions of the Act, see 30 U.S.C. 
932(a), (h), 936(a), the proposed regulation simply codifies the 
Department's existing interpretation of the Act with respect to the 
enforcement of benefits.
    Paragraph (a) recognizes that the owners of sole proprietorships 
and the principals in partnerships are directly liable for the debts 
incurred by their companies. Moreover, as the Fourth Circuit noted in 
McKee, such individuals are ``unquestionably operators.'' 845 F.2d at 
72.
    Paragraph (b) implements Sec. 423(d) of the Act, 30 U.S.C. 933(d). 
That statutory section provides that where an operator is a corporation 
that has failed to secure its liability for benefits under the Act, the 
president, secretary, and treasurer of such corporation ``shall be 
severally personally liable, jointly with such corporation, for any 
benefit which may accrue under this title in respect to any disability 
which may occur to any employee of such corporation while it shall so 
fail to secure the payment of benefits as required by this section.'' 
Although such officers do not meet the definition of the term 
``operator'' (Sec. 725.491), they may be held liable for the payment of 
benefits once the corporation has been determined to be the responsible 
operator. Paragraph (b) further recognizes the ongoing nature of the 
duty imposed on the named corporate officers by Sec. 423. For example, 
Sec. 423(a) provides that an operator is responsible for ``insuring and 
keeping insured the payment of such benefits.'' The Department's 
proposed civil money penalty regulations (20 CFR part 726, subpart D) 
recognize a similar ongoing duty with respect to self-insured operators 
(see proposed Sec. 726.302(b)). Thus, any person who becomes a 
corporate officer of the responsible operator after the miner ceases 
his employment may be held personally liable for the payment of the 
miner's benefits. The regulation allows such a corporate officer to 
limit his personal liability by ensuring that the corporation posts 
security for the claim under Sec. 725.606.
    Paragraph (c) implements the Act's successor operator provisions in 
cases where the prior operator becomes unable to pay an award of 
benefits. 30 U.S.C. 932(i). In such cases, the Act imposes liability on 
any operator that may be considered a ``successor operator.'' For 
example, where one operator merges into another, the Department or any 
beneficiary of an award should be able to quickly and summarily enforce 
the pre-existing obligations of the first operator against the second. 
The regulation recognizes that the liability of successor operators in 
the enforcement context should be limited to those claims of which they 
have constructive notice at the time of the event which gave rise to 
the successor liability. For example, if one

[[Page 3369]]

company purchased the coal mining business of another on January 1, 
1990, it will be deemed to have notice of all claims filed against the 
seller as of that date. If the seller subsequently becomes unable to 
pay any benefits due in those claims, those obligations may be enforced 
directly against the successor operator. Any claims filed after the 
date of sale may be enforced against the successor only if the 
successor is provided with an opportunity to litigate the miner's 
entitlement to benefits in the claims process set forth in Subparts E 
and F of this part.
    Paragraph (d) deals with companies which mine coal through 
subsidiaries, joint ventures, or other business entities which they own 
or control. Such companies may be considered operators under the Act 
(see proposed Sec. 725.491), and must ensure the payment of benefits 
by, and thus assume the risk of any failure on the part of, such 
subsidiaries, joint ventures, or other business entities. For example, 
a parent company may not avoid its existing liability by dissolving or 
liquidating a subsidiary company. Any pre-existing obligations of such 
subsidiary may be enforced against such parent company without further 
resort to the claims process.
    Finally, paragraph (e) is a catch-all provision designed to put all 
parties on notice that the Department can take full advantage of any 
other applicable federal or state law. For example, the Department has 
encountered a number of cases in which the responsible operator has 
gone out of business and its insurer has been declared insolvent by the 
state in which it was established. In such a case, the Department and 
the award beneficiary may collect from a state insurance guaranty 
association where state law requires such an association to assume the 
insurer's liabilities.
    20 CFR 725.620. Paragraph (a) must be amended to conform with 
revisions to Sec. 725.495 and part 726. Section 725.495 is being 
amended and its contents moved to a more appropriate location, subpart 
D of part 726, the regulations governing enforcement of the obligation 
to insure and the assessment of a penalty for failure to secure benefit 
payments. Thus, Sec. 725.620(a) must contain a cross-reference to the 
new location of the relevant material.
    20 CFR 725.621. In accordance with the Debt Collection Improvement 
Act of 1996 (Pub. L. 104-134, Sec. 31001(s), 110 Stat. 1358), which 
amended the Federal Civil Penalties Inflation Adjustment Act of 1990 
(Pub. L. 101-410, 104 Stat. 890), the maximum penalty amount for 
failing to file a report required by the Secretary's regulations, see 
30 USC Sec. 942(b), must be increased by ten percent with respect to 
violations that take place after these proposed regulations become 
effective.

Subpart J--Medical Benefits and Vocational Rehabilitation

    20 CFR 725.701. Section 725.701 should be amended to codify the 
presumption of coverage created by the United States Court of Appeals 
for the Fourth Circuit in Doris Coal Co. v. Director, OWCP, 938 F.2d 
492 (4th Cir. 1991). In Doris Coal Co., the Fourth Circuit recognized 
that the broad definition of pneumoconiosis necessarily brought within 
its ambit most pulmonary disorders for which a miner might receive 
treatment. The Court therefore concluded that ``when a miner receives 
treatment for a pulmonary disorder, a presumption arises that the 
disorder was caused or at least aggravated by the miner's 
pneumoconiosis.'' 938 F.2d at 496. The Department endorses this 
approach, and accordingly amends Sec. 725.701 to codify it. Although 
the decision does not describe the means of rebutting the presumption, 
the proposed regulation requires evidence which completely severs the 
presumed nexus between the pulmonary disorder and the miner's 
pneumoconiosis. The proposed regulation also prohibits use of evidence 
which challenges the miner's underlying entitlement to benefits as a 
means of showing that the treatment cannot be compensable. A final 
award of benefits establishing that the miner is totally disabled due 
to pneumoconiosis arising out of coal mine employment precludes 
reliance on any medical evidence that is inconsistent with that award. 
The proper forum for such evidence is modification (see Sec. 725.310).
    20 CFR 725.706. The historical rise in treatment costs warrants 
raising the no-approval dollar amount in paragraph (b) from $100.00 to 
$300.00.

20 CFR Part 726--Black Lung Benefits; Requirements for Coal Mine 
Operators' Insurance

Subpart A--General

    20 CFR 726.2. Paragraph (e) is added to recognize the addition of 
subpart D of part 726, governing the assessment of civil money 
penalties.
    20 CFR 726.8. Proposed Sec. 726.8 is intended to define certain 
terms that are used in part 726. The terms ``employ'' and 
``employment'' are important not only to the Department's enforcement 
of the Act's civil money penalty provisions, but also to the liability 
of insurance carriers and sureties. Thus, both the required insurance 
endorsement, set forth at Sec. 726.203, and the standard surety bond 
form, use the term ``employment.'' Paragraph (d), which is identical to 
proposed paragraph 725.493(a)(1), codifies the Department's position 
that these terms should be given the broadest possible interpretation.

Subpart B--Authorization of Self-Insurers

    20 CFR 726.101, .104, .105, .109, .110, .111. The Department's 
existing self-insurance regulations do not contain a list of the 
factors that the Department currently considers in setting the amount 
of security required of an operator seeking authorization to self-
insure its benefit obligations. The formula set forth in 
Sec. 726.101(b)(4) was intended to be used only in 1974. See current 20 
CFR 726.105. The revisions to Sec. 726.101(b)(4) eliminate the 22-year 
old formula in favor of a non-exclusive list of factors, now set forth 
in Sec. 726.105. These factors are a more accurate reflection of the 
Department's current method of setting a security amount. Language 
referring to the formula in Sec. 726.101 has been deleted from 
Sec. 726.105. In addition, Sec. 726.104 has been revised to recognize 
two forms of security (letters of credit and tax-exempt trusts) that 
the Department did not allow in 1974, when these regulations were last 
amended, but that it does allow now. Paragraph (b)(4) reflects the 
Department's decision to allow self-insurers to use letters of credit 
only in combination with another form of security. Sections 726.101, 
726.109, 726.110 and 726.111 have been revised to remove specific 
references to the earlier forms of security and to substitute more 
general references.
    20 CFR 726.106. The reference in paragraph (c) to ``31 CFR 203.7 
and 203.8'' is incorrect. The regulation is revised to reference ``31 
CFR Part 225,'' which contains the appropriate regulations governing 
deposits with the United States.
    20 CFR 726.114. A new paragraph (c) has been added to codify the 
Department's position that coal mine operators authorized to self-
insure their benefit liability under 30 U.S.C. 933(a) continue to be 
responsible for maintaining adequate security even after they have 
ceased mining coal. See the explanation to Secs. 726.300-.320, below. 
Paragraph (b) is revised to eliminate the specific reference to the 
forms of security previously accepted by the Department in favor of a 
more general reference. See discussion of Sec. 726.104, above.

[[Page 3370]]

Subpart D--Civil Money Penalties

    20 CFR 726.300-.320. Section 423 of the Black Lung Benefits Act 
requires each coal mine operator to secure its liability for benefits 
by qualifying as a self-insurer in accordance with regulations 
prescribed by the Secretary, or by insuring and keeping insured the 
payment of such benefits with a licensed workers' compensation insurer. 
30 U.S.C. 933(a). Section 423 also provides that each coal mine 
operator failing to meet its insurance obligation shall be subject to a 
civil money penalty of up to $1,000 per day. 30 U.S.C. 933(d)(1). In 
accordance with the Debt Collection Improvement Act of 1996 (Pub. L. 
104-134, Sec. 31001(s), 110 Stat. 1358), which amended the Federal 
Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410, 104 
Stat. 890), the maximum penalty amount must be increased by ten percent 
with respect to violations that take place after these proposed 
regulations become effective.
    The proposed regulations are designed to enhance administration of 
the civil money penalty program. The Department intends to minimize the 
burden that uninsured operators place on those operators in compliance 
with the Act's requirements and on the Black Lung Disability Trust 
Fund. For example, in a case where the miner's most recent employer was 
not insured, potential liability for benefits will typically fall on an 
earlier employer which secured its benefits liability. This situation 
places an additional burden on an operator fully in compliance with the 
Act's insurance requirements. See Director, OWCP v. Trace Fork Coal 
Co., 67 F.3d 503, 507 (4th Cir. 1995). Similarly, if no operator may be 
held liable for the payment of a miner's benefits, the Trust Fund must 
assume liability, 26 U.S.C. 9501(d)(1)(B), placing an additional 
financial burden on the indebted Fund.
    Currently, the Department's procedural and substantive criteria for 
administering the Act's penalty provision are contained in a single 
regulation, 20 CFR 725.495, proposed in April, 1978 and promulgated, 
without comment, in August, 1978. The proposed changes, which 
significantly alter the existing regulation, are in accordance with the 
1979 recommendations of the Administrative Conference of the United 
States, 1 CFR 305.79-3. In particular, the new regulations are intended 
to accomplish three goals: (1) establish criteria to be used in 
assessing penalties against coal mine operators; (2) provide affected 
parties with notice of those criteria; and (3) streamline the 
assessment process.
    The current regulation provides only that an administrative law 
judge should impose ``the maximum penalty allowed'' in the absence of 
``mitigating'' circumstances. 20 CFR 725.495(d). The regulation, 
however, does not define mitigating circumstances. By allowing each 
administrative law judge to determine penalty amounts in this manner, 
the regulation encourages subjective and inconsistent application of 
the statutory penalty. In Kleppe v. Delta Mining, Inc., 423 U.S. 403 
(1976), the Supreme Court noted that the Interior Department had only 
recently developed formulas to be used in determining penalty amounts 
under the Federal Mine Safety and Health Act. The Court noted that 
``[u]se of the current regulations is preferable to the ad hoc 
consideration given the [statutory] criteria in this case.'' 413 U.S. 
at 409 n.2.
    The proposed regulations address this problem by presenting a 
graduated series of possible penalties based on a set of enumerated 
criteria. The regulations adjust the penalty based on an operator's 
size, its prior notice of the Act's insurance requirements, and the 
operator's action, or lack thereof, following notification of the 
insurance requirements. By publishing these regulations, the Department 
establishes penalty criteria and provides the public with notice of 
those criteria for the first time.
    The proposed regulations also make two procedural changes designed 
to streamline the penalty assessment process. Unlike the current 
regulation, which requires the Office of Workers' Compensation Programs 
to refer any case to the Office of Administrative Law Judges, whether 
contested or not, the proposed regulations allow the Department's 
initial proposed penalty to become final if no party requests a 
hearing. This proposal recognizes the wisdom and applicability of the 
Supreme Court's observation in National Independent Coal Operators' 
Association v. Kleppe, 423 U.S. 388, 399 (1976), which also arose under 
the Federal Mine Health and Safety Act. In that decision, the Court 
observed that ``[e]ffective enforcement of the Act would be weakened if 
the Secretary were required to make findings of fact for every penalty 
assessment including those cases in which the mine operator did not 
request a hearing and thereby indicated no disagreement with the 
Secretary's proposed determination.'' In addition, the proposed 
regulations provide for discretionary ``appellate'' review of 
administrative law judge decisions by the Secretary of Labor at the 
request of any party. Upon receipt of a timely petition for review, the 
Secretary will determine whether review is warranted. This change is 
designed to encourage the consistent application of the criteria used 
to assess a penalty. It is hoped that a uniform body of penalty 
decisions will result from allowing the Secretary of Labor to review 
the decisions of administrative law judges.
    Substantively, the new regulations add a definition of the time 
period within which coal mine operators must comply with the security 
requirement. The proposed regulation, Sec. 726.302(b), distinguishes 
between operators that purchase commercial insurance to secure their 
liability and those that self-insure. The obligations of the former are 
extinguished when they cease mining coal, while the latter group must 
continue to secure the payment of benefits. This distinction is based 
on important differences in the type of insurance coverage secured by 
each group.
    Under the Act, commercial insurance issued to cover black lung 
liability has no upper monetary limit; in exchange for a premium, the 
carrier agrees to assume liability for all claims arising out of 
employment during the period covered by the premium. Thus, an operator 
that has purchased insurance for the duration of its operation of a 
mine does not leave behind any unsecured liability when it ceases coal 
mining.
    In contrast, the Department typically does not require self-insured 
operators to post bonds or other security with a face value that would 
cover all of the operator's expected black lung liability. Indeed, 
requiring security for the full amount of expected benefits might well 
impose costs that many otherwise low-risk operators could not bear. 
Rather, the Department has been willing to rely in part on a company's 
size as a partial guarantor of future benefit payments. Accordingly, 
depending on the operator's assets, the Department usually requires 
security to cover only from three to fifteen years of the operator's 
payments on claims currently in award status.
    This requirement, however, has left the Department vulnerable in 
several recent bankruptcies involving large self-insured operators, 
such as the LTV Corporation and CF&I Fabricators. In both cases, the 
companies had ceased mining coal several years before filing for 
bankruptcy protection, and had not purchased bonds that reflected their 
post-mining claims experience. The proposed regulations attempt to 
remedy this problem by requiring self-insured operators to continue to 
secure the

[[Page 3371]]

payment of benefits to their employees even after the operator has 
ceased mining coal. A new paragraph (c) has been added to Sec. 726.114 
to provide notice of this duty to operators seeking authorization to 
self-insure their liabilities.
    Finally, the proposed regulations will be moved from part 725, 
which governs the processing, adjudication, payment, and enforcement of 
claims for benefits under the Act, to part 726, which deals exclusively 
with issues of insurance and self-insurance. This move is intended to 
centralize the regulations implementing Sec. 423 of the Act. The 
Department also hopes to eliminate any potential confusion about the 
applicability of certain incorporated provisions of the Longshore and 
Harbor Workers' Compensation Act. These provisions simply do not apply 
to penalty assessments.

20 CFR Part 727--Review of Pending and Denied Claims under the 
Black Lung Benefits Reform Act of 1977

    In 1978, Congress required the Department of Labor to promulgate 
interim entitlement criteria that were ``no more restrictive'' than 
criteria used to adjudicate claims that had been filed with the Social 
Security Administration under Part B of the Black Lung Benefits Act. 
These interim criteria were to be used until the Department could 
develop permanent criteria. The part 727 interim regulations were 
published at 43 FR 36818, Aug. 18, 1978. Because the Department's 
permanent part 718 criteria took effect on April 1, 1980, see 20 CFR 
718.2, the part 727 regulations only apply to claims filed before that 
date. The Department estimates that several hundred part 727 claims 
remain pending in various stages of adjudication. Because the parties 
to these claims are quite familiar with the standards for establishing 
eligibility under part 727, and no new claims will be adjudicated under 
these standards, the Department intends to discontinue the annual 
publication of part 727 in the Code of Federal Regulations. Those 
standards will remain in effect for all claims to which they apply. 
Parties interested in reviewing part 727 may consult earlier editions 
of the Code of Federal Regulations or the Federal Register in which the 
regulations were originally published.

Drafting Information

    This document was prepared under the direction and supervision of 
Bernard Anderson, Assistant Secretary of Labor for Employment 
Standards.
    The principal authors of this document are Rae Ellen James, Deputy 
Associate Solicitor; Richard Seid, Counsel for Administrative 
Litigation and Legal Advice; and Michael Denney, Counsel for 
Enforcement, Black Lung Benefits Division, Office of the Solicitor, 
U.S. Department of Labor. Personnel from the Division of Coal Mine 
Workers' Compensation, Office of Workers' Compensation Programs, 
Employment Standards Administration, U.S. Department of Labor, assisted 
in the preparation of the document.

Executive Order 12866

    The Department believes that the proposed regulatory changes will 
not have a significant economic impact upon the coal industry or 
significantly affect the approval rate for black lung claims. The 
proposed changes do not pose novel legal or policy issues within the 
meaning of the Executive Order since most of the proposed changes are 
codifications of appellate decisions or procedural in nature. The 
proposed changes are intended to encourage faster, fairer and cheaper 
benefit determinations as well as make it easier to enforce employers' 
and insurers' responsibilities to pay benefits. They are part of the 
Reinvention initiatives supported by the National Performance Review 
and have been reviewed by the Office of Management and Budget for 
consistency with its objectives.

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 proposed changes would establish no new record keeping 
requirements. Moreover, they seek to reduce the volume of medical 
examination and consultants' reports which are currently created solely 
for the purpose of litigation by limiting the amount of such medical 
evidence which will be admissible in black lung proceedings.

Regulatory Flexibility Act, as Amended

    The American coal industry has produced a billion tons of coal 
(anthracite, bituminous and lignite) each year since 1990. The 
industry's output is worth approximately $20 billion per year, with the 
precise total varying depending on market conditions. Major segments of 
the industry are highly mechanized and very capital intensive, 
especially surface mining operations and underground operations using 
long wall mining technology. More traditional segments of the industry 
which still rely on the older continuous miner technology are somewhat 
more labor intensive. Overall, however, labor costs in the industry 
equal less than one fourth of the value of its product output. 
Employment in the coal industry has been steadily declining as a result 
of increased mechanization. It peaked at three-quarters of a million 
men and boys in 1918 when total production reached nearly 700 million 
tons. That production record stood until the Second World War, when new 
highs were reached with a workforce which had declined by 250,000.
    The 1995 workforce in the industry was only 97,380 according to the 
Mine Safety and Health Administration (MSHA). Bureau of Labor 
Statistics data reflects an average hourly pay rate in the coal 
industry for production or non-supervisory workers in 1995 of $18.44. 
Assuming full year round employment, but no overtime, the annual per 
employee wage costs would be $38,355 ($18.44 per hour times 2080 
hours). Projecting that figure to the 1995 workforce yields an annual 
labor cost of approximately $3.7 billion.
    Employers engaged in the extraction and preparation of coal are 
required by the Black Lung Benefits Act to ``secure the payment'' of 
any benefits to former employees for which they are found liable. They 
may either qualify with the Department of Labor as self-insurers or 
purchase insurance to satisfy that statutory obligation.
    Self-insurer status is only granted to companies with a net worth 
of at least $10 million and at least three years' operating experience 
in the industry. Approximately ten percent of the companies now active 
in the industry are authorized self-insurers or subsidiaries of a 
corporate parent which is an authorized self-insurer which has 
guaranteed their liabilities under the Act. The remaining companies in 
the industry are dependent upon insurance to meet their obligations. 
This is normally done by purchasing a Federal Black Lung rider as an 
attachment to their state workers' compensation insurance policy. 
Premium rates for this insurance are established by the individual 
states and not by the Federal Government.
    The Division of Coal Mine Workers' Compensation has published in 
its Annual Reports occupational disease insurance rates for eleven 
major coal producing states for the largest group of covered workers--
underground bituminous coal miners--since the

[[Page 3372]]

1970's. These rates are assessed per $100 of payroll. Because of the 
offset provisions, combined state and Federal occupational disease 
coverage rates were initially published. However, beginning with the 
1986 report, the state and Federal rates are now shown separately, for 
those states which calculate them separately.
    From 1986 through 1994 (the last year for which data has been 
published), the average Federal black lung insurance rates have been 
virtually constant for the nine states for which comparable data is 
available throughout the period. In 1986, the average rate was $4.23 
per $100 of payroll; for 1994 it was $4.33, an increase of only 2.4%. 
During that period, Federal coverage rates increased in four states 
(Alabama, Illinois, Kentucky and Tennessee), declined in three states 
(Colorado, Indiana and Utah) and remained unchanged in two states 
(Virginia and West Virginia). When a weighted average rate is 
calculated based on the number of underground miners in each state, the 
rate becomes $3.65 per $100 of payroll.
    Assuming a maximum impact scenario, the total coal industry cost 
for complying with the Act's insurance requirements would currently be 
$135 million ($3.7 billion of payroll times $3.65 per $100 of payroll). 
In fact, it is significantly less. Most larger employers opt for self-
insurance not only because it provides direct control over claims made 
against them by their former employees but also because it is less 
expensive than the purchase of commercial coverage. Also, some job 
classifications, especially in surface mining, carry a lower premium 
rate than that which is applicable to underground bituminous miners. To 
produce an economic impact on the coal industry of $100 million per 
year or more, these insurance costs would have to increase by over 70%. 
Insurance rates are based largely on a combination of historical 
experience and actuarial projections of future liabilities.
    The current insurance rates are based on the experience with 
eligibility criteria as they have existed since the 1981 Amendments to 
the Act became effective on January 1, 1982. Under those criteria only 
7.5% of the persons who have applied for benefits have been awarded 
them. A 70% increase in approvals would be required to carry that 
approval rate up to 13%. However, there is nothing in the proposed 
regulatory changes which alters those eligibility criteria. Most of the 
changes reflect a codification of appellate decisions. Many of those 
decisions involve liberalizing constructions of the Act and 
regulations; however, the single most important decision reflected is 
one by the Supreme Court striking down the ``true doubt'' rule. This 
decision requires the claimant to prove each element of his case by a 
preponderance of the evidence and prohibits giving the claimant the 
benefit of the doubt when the evidence is evenly balanced for and 
against entitlement. Although these changes are expected to simplify, 
expedite and make more uniform the results of the claims development 
and decision processes, they are unlikely to significantly alter case 
outcomes.
    The major changes proposed are procedural ones intended to level 
the playing field between the individual claimant and the employer or 
insurer by placing limits upon the amount of evidence which each party 
can submit. The shift from a focus on the quantity of evidence to the 
quality of the evidence is a significant one in terms of addressing 
past perceptions of unfairness in the present system.
    However, the employer or insurer, who could previously overwhelm 
the miner by the quantity of consultant reports and x-ray re-readings 
it could submit because of its greater financial resources, will still 
have an inherent advantage through possession of superior access to the 
best credentialed medical experts in the field. Even the new regulation 
which codifies the circumstances under which controlling weight can be 
given to the opinion of the miner's treating physician is unlikely to 
alter outcomes in very many cases. Few general practitioners in rural 
coal field areas are likely to meet the combination of duration of 
treatment, specialty qualifications and ability to produce a reasoned 
narrative relating their conclusions to the objective medical data 
required to invoke this special status.
    The Department projects that the approval rate will rise, but only 
from 7.5% to 8% or 9%. This increase in the approval rate by 20% or 
less would justify an increase in the premium rate of less than 75 
cents per $100 of payroll for underground bituminous miners or, using 
the maximum impact calculations provided above, no more than $28 
million industrywide per year. In fact, insurance rates may increase 
slightly more than this amount initially because actuarial projections 
used in the insurance ratemaking process tend to err on the high side 
in projecting possible future liabilities. A temporary increase in the 
number of claims filings will probably also occur in the first year 
after promulgation of the regulations. However, once a significant body 
of experience has been gained under the revised regulations, the rates 
will stabilize at the appropriate level. In no event does the 
Department anticipate an increase of as much as $40 million per year, 
even during the initial period prior to establishing a new base of 
experience under the revised procedures.
    Approximately eighty percent of all coal mined in the United States 
is purchased by utilities for use in the generation of electricity. 
Over one-half of all electricity generated in the United States is 
produced by coal-burning plants. Approximately ten percent of all coal 
mined in the United States is exported.
    The remaining ten percent of coal mined is consumed domestically 
for a variety of uses, including steelmaking, heating, etc. An increase 
of approximately $40 million per year in the costs of a $20 billion 
industry equates to only two-tenths of one percent, or four cents per 
ton of coal produced. It would not significantly adversely impact 
coal's competitive position vis-a-vis other fuel sources, such as 
petroleum, natural gas, or nuclear power.
    This analysis has not attempted to apply definitions of small 
entities in the coal mining industry which have been developed by other 
agencies, such as MSHA or the Small Business Administration (SBA) for 
other purposes for two basic reasons. First, data on the number of 
miners employed or total annual volume of business done by individual 
companies is not routinely gathered by the Division of Coal Mine 
Workers' Compensation because it is not directly relevant to the 
administration of the Black Lung Benefits Act for employers who are 
covered by insurance. The second and more relevant reason is that the 
entities active in the industry are divided into the two classes of 
those eligible to self-insure and those which are not.
    Because of the high threshold requirement of a net worth of $10 
million, plus three years' operating experience in the industry, to 
qualify for the privilege of self-insurance, all entities which MSHA 
would classify as ``small mines'' are included in the commercially 
insured category, except those which are subsidiaries of qualified 
self-insurers. The SBA definition of a coal mining company as a small 
business if it has fewer than 500 employees is not particularly 
helpful. A highly mechanized and capitalized mining company, especially 
in the Western surface mining industry, may well qualify as a self-
insurer because of its net worth and experience even though it has many 
fewer than 500 employees. It is nonetheless true that it is generally 
the smaller entities in the

[[Page 3373]]

industry which are dependent upon commercial insurance coverage to meet 
their obligations under the Act.
    The point of this analysis, however, is that all entities subject 
to the insurance requirement will be equally affected by any changes in 
insurance rates. Therefore, their relative competitive position vis-a-
vis one another or vis-a-vis those companies eligible to self-insure 
will not be adversely impacted by any changes which may result from the 
implementation of these regulatory proposals. In summary, the 
Department estimates that the proposed changes in the regulations will 
impose a maximum cost on firms of less than one percent of payroll or 
two-tenths of one percent of total revenue industrywide. Small firms 
are not expected to be disproportionately affected by these changes. 
However, the Department welcomes comments on this economic analysis, 
especially concerning the impact of the proposed changes on small 
entities and self-insured employers. Comments are also solicited on the 
projected change in the approval rate and any other factors which may 
be relevant which are not currently included in the analysis. Our 
current assessment that the proposed regulations will have no more than 
an annual $40 million impact on the industry may be affected by the 
comments received.
    Therefore, the Assistant Secretary hereby certifies that 
implementation of these proposed changes will not have a significant 
economic impact on a substantial number of small entities.

List of Subjects in 20 CFR Parts 718, 722, 725, 726 and 727.

    Black lung benefits, Lung disease, Miners, Mines, Reporting and 
recordkeeping requirements, Workers' Compensation, X-rays.

    Signed at Washington, D.C., this 27th day of December, 1996.
Robert B. Reich,
Secretary of Labor.
Gene Karp,
Acting Assistant Secretary for Employment Standards.

    For the reasons set forth in the preamble, 20 CFR Chapter VI is 
proposed to be amended as follows:
    1. The authority citation for part 718 continues to read as 
follows:

    Authority: 5 U.S.C. 301, Reorganization Plan No. 6 of 1950, 15 
FR 3174, 30 U.S.C. 901 et seq., 902(f), 925, 932, 934, 936, 945; 33 
U.S.C. 901 et seq., 42 U.S.C. 405, Secretary's Order 7-87, 52 FR 
48466, Employment Standards Order No. 90-02.

    2. Part 718 is proposed to be amended by removing subpart E, 
revising subparts A through D, revising Appendices A and C, and 
revising the text of Appendix B (the tables, B1 through B6, in Appendix 
B remain unchanged):

PART 718--STANDARDS FOR DETERMINING COAL MINERS' TOTAL DISABILITY 
OR DEATH DUE TO PNEUMOCONIOSIS

Subpart A--General

Sec.
718.1  Statutory provisions.
718.2  Applicability of this part.
718.3  Scope and intent of this part.
718.4  Definitions and use of terms.

Subpart B--Criteria for the Development of Medical Evidence

718.101  General.
718.102  Chest roentgenograms (X-rays).
718.103  Pulmonary function tests.
718.104  Report of physical examinations.
718.105  Arterial blood-gas studies.
718.106  Autopsy; biopsy.
718.107  Other medical evidence.

Subpart C--Determining Entitlement to Benefits

718.201  Definition of pneumoconiosis.
718.202  Determining the existence of pneumoconiosis.
718.203  Establishing relationship of pneumoconiosis to coal mine 
employment.
718.204  Total disability and disability causation defined; criteria 
for determining total disability and total disability due to 
pneumoconiosis.
718.205  Death due to pneumoconiosis.
718.206  Effect of findings by persons or agencies.

Subpart D--Presumptions Applicable to Eligibility Determinations

718.301  Establishing length of employment as a miner.
718.302  Relationship of pneumoconiosis to coal mine employment.
718.303  Death from a respirable disease.
718.304  Irrebuttable presumption of total disability or death due 
to pneumoconiosis.
718.305  Presumption of pneumoconiosis.
718.306  Presumption of entitlement applicable to certain death 
claims.
Appendix A to Part 718-Standards for Administration and 
Interpretation of Chest Roentgenograms (X-rays)
Appendix B to Part 718-Standards for Administration and 
Interpretation of Pulmonary Function Tests. Tables B1, B2, B3, B4, 
B5, B6
Appendix C to Part 718-Blood Gas Tables

Subpart A--General


Sec. 718.1  Statutory Provisions.

    (a) Under title IV of the Federal Coal Mine Health and Safety Act 
of 1969, as amended by the Black Lung Benefits Act of 1972, the Federal 
Mine Safety and Health Amendments Act of 1977, the Black Lung Benefits 
Reform Act of 1977, the Black Lung Benefits Revenue Act of 1977, the 
Black Lung Benefits Amendments of 1981, and the Black Lung Benefits 
Revenue Act of 1981, benefits are provided to miners who are totally 
disabled due to pneumoconiosis and to certain survivors of a miner who 
died due to or while totally or partially disabled by pneumoconiosis. 
However, unless the miner was found entitled to benefits as a result of 
a claim filed prior to January 1, 1982, benefits are payable on 
survivors' claims filed on or after January 1, 1982, only when the 
miner's death was due to pneumoconiosis, except where the survivor's 
entitlement is established pursuant to Sec. 718.306 of this part on a 
claim filed prior to June 30, 1982. Before the enactment of the Black 
Lung Benefits Reform Act of 1977, the authority for establishing 
standards of eligibility for miners and their survivors was placed with 
the Secretary of Health, Education, and Welfare. These standards were 
set forth by the Secretary of Health, Education, and Welfare in subpart 
D of part 410 of this title, and adopted by the Secretary of Labor for 
application to all claims filed with the Secretary of Labor (see 20 CFR 
718.2, 1978). Amendments made to section 402(f) of the Act by the Black 
Lung Benefits Reform Act of 1977 authorize the Secretary of Labor to 
establish criteria for determining total or partial disability or death 
due to pneumoconiosis to be applied in the processing and adjudication 
of claims filed under part C of title IV of the Act. Section 402(f) of 
the Act further authorizes the Secretary of Labor, in consultation with 
the National Institute for Occupational Safety and Health, to establish 
criteria for all appropriate medical tests administered in connection 
with a claim for benefits. Section 413(b) of the Act authorizes the 
Secretary of Labor to establish criteria for the techniques to be used 
to take chest roentgenograms (X-rays) in connection with a claim for 
benefits under the Act.
    (b) The Black Lung Benefits Reform Act of 1977 provided that with 
respect to a claim filed prior to April 1, 1980, or reviewed under 
section 435 of the Act, the standards to be applied in the adjudication 
of such claim shall not be more restrictive than the criteria 
applicable to a claim filed on June 30, 1973, with the Social Security 
Administration, whether or not the final disposition of the claim 
occurs after March 31, 1980. All such claims shall be reviewed under 
the criteria set forth in part 727 of this title (see 20 CFR 725.4(d)).

[[Page 3374]]

Sec. 718.2  Applicability of this part.

    This part is applicable to the adjudication of all claims filed 
after March 31, 1980, and considered by the Secretary of Labor under 
section 422 of the Act and part 725 of this subchapter. If a claim 
subject to the provisions of section 435 of the Act and subpart C of 
part 727 of this subchapter (see 20 CFR 725.4(d)) cannot be approved 
under that subpart, such claim may be approved, if appropriate, under 
the provisions contained in this part. The provisions of this part 
shall, to the extent appropriate, be construed together in the 
adjudication of all claims.


Sec. 718.3  Scope and intent of this part.

    (a) This part sets forth the standards to be applied in determining 
whether a coal miner is or was totally, or in the case of a claim 
subject to Sec. 718.306 partially, disabled due to pneumoconiosis or 
died due to pneumoconiosis. It also specifies the procedures and 
requirements to be followed in conducting medical examinations and in 
administering various tests relevant to such determinations.
    (b) This part is designed to interpret the presumptions contained 
in section 411(c) of the Act, evidentiary standards and criteria 
contained in section 413(b) of the Act and definitional requirements 
and standards contained in section 402(f) of the Act within a coherent 
framework for the adjudication of claims. It is intended that these 
enumerated provisions of the Act be construed as provided in this part.


Sec. 718.4  Definitions and use of terms.

    Except as is otherwise provided by this part, the definitions and 
usages of terms contained in Sec. 725.101 of subpart A of part 725 of 
this title shall be applicable to this part.

Subpart B--Criteria for the Development of Medical Evidence


Sec. 718.101  General.

    (a) The Office of Workers' Compensation Programs (hereinafter OWCP 
or the Office) shall develop the medical evidence necessary for a 
determination with respect to each claimant's entitlement to benefits. 
Each miner who files a claim for benefits under the Act shall be 
provided an opportunity to substantiate his or her claim by means of a 
complete pulmonary evaluation including, but not limited to, a chest 
roentgenogram (X-ray), physical examination, pulmonary function tests 
and a blood-gas study.
    (b) The standards for the administration of clinical tests and 
examinations contained in this subpart shall apply to all evidence 
developed by any party in connection with a claim governed by this part 
(see Secs. 725.406(b), 725.414(a), 725.456(d)). These standards shall 
also apply to claims governed by part 727 (see 20 CFR 725.4(d)), but 
only for clinical tests or examinations conducted after March 31, 1980. 
Any clinical test or examination subject to these standards shall be in 
substantial compliance with the applicable standard in order to 
constitute evidence of the fact for which it is proffered. Unless 
otherwise provided, any evidence which is not in substantial compliance 
with the applicable standard is insufficient to establish the fact for 
which it is proffered.


Sec. 718.102  Chest roentgenograms (X-rays).

    (a) A chest roentgenogram (X-ray) shall be of suitable quality for 
proper classification of pneumoconiosis and shall conform to the 
standards for administration and interpretation of chest X-rays as 
described in Appendix A to this part.
    (b) A chest X-ray to establish the existence of pneumoconiosis 
shall be classified as Category 1, 2, 3, A, B, or C, according to the 
International Labour Organization Union Internationale Contra Cancer/
Cincinnati (1971) International Classification of Radiographs of the 
Pneumoconioses (ILO-U/C 1971), or subsequent revisions thereof. A chest 
X-ray classified as Category Z under the ILO Classification (1958) or 
Short Form (1968) shall be reclassified as Category O or Category 1 as 
appropriate, and only the latter accepted as evidence of 
pneumoconiosis. A chest X-ray classified under any of the foregoing 
classifications as Category O, including sub-categories 0--, 0/0, or 0/
1 under the UICC/Cincinnati (1968) Classification or the ILO-U/C 1971 
Classification does not constitute evidence of pneumoconiosis.
    (c) A description and interpretation of the findings in terms of 
the classifications described in paragraph (b) of this section shall be 
submitted by the examining physician along with the film. The report 
shall specify the name and qualifications of the person who took the 
film and the name and qualifications of the physician interpreting the 
film. If the physician interpreting the film is a Board-certified or 
Board-eligible radiologist or a certified ``B'' reader (see 
Sec. 718.202), he or she shall so indicate. The report shall further 
specify that the film was interpreted in compliance with this 
paragraph.
    (d) The original film on which the X-ray report is based shall be 
supplied to the Office, unless prohibited by law, in which event the 
report shall be considered as evidence only if the original film is 
otherwise available to the Office and other parties. Where the chest X-
ray of a deceased miner has been lost, destroyed or is otherwise 
unavailable, a report of a chest X-ray submitted by any party shall be 
considered in connection with the claim.
    (e) No chest X-ray shall constitute evidence of the presence or 
absence of pneumoconiosis unless it is conducted and reported in 
accordance with the requirements of this section and Appendix A. In the 
absence of evidence to the contrary, compliance with the requirements 
of Appendix A shall be presumed. In the case of a deceased miner where 
the only available X-ray does not substantially comply with this 
subpart, such X-ray shall be considered and shall be accorded 
appropriate weight in light of all relevant evidence if it is of 
sufficient quality for determining the presence or absence of 
pneumoconiosis and such X-ray was interpreted by a Board-certified or 
Board-eligible radiologist or a certified ``B'' reader (see 
Sec. 718.202).

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 718.103  Pulmonary function tests.

    (a) Any report of pulmonary function tests submitted in connection 
with a claim for benefits shall record the results of the forced 
expiratory volume in one second (FEV1) and either the forced vital 
capacity (FVC) or the maximum voluntary ventilation (MVV) or both. If 
the MVV is reported, the results of such test shall be obtained 
independently rather than calculated from the results of the FEV1.
    (b) All pulmonary function test results submitted in connection 
with a claim for benefits shall be accompanied by three tracings of 
each test performed, unless the results of two tracings of the MVV are 
within 5% of each other, in which case two tracings for that test shall 
be sufficient. Pulmonary function test results submitted in connection 
with a claim for benefits shall also include a statement signed by the 
physician or technician conducting the test setting forth the 
following:
    (1) Date and time of test;
    (2) Name, DOL claim number, age, height, and weight of claimant at 
the time of the test;
    (3) Name of technician;
    (4) Name and signature of physician supervising the test;

[[Page 3375]]

    (5) Claimant's ability to understand the instructions, ability to 
follow directions and degree of cooperation in performing the tests. If 
the claimant is unable to complete the test, the person executing the 
report shall set forth the reasons for such failure;
    (6) Paper speed of the instrument used;
    (7) Name of the instrument used;
    (8) Whether a bronchodilator was administered. If a bronchodilator 
is administered, the physician's report must detail values obtained 
both before and after administration of the bronchodilator and explain 
the significance of the results obtained; and
    (9) That the requirements of paragraphs (b) and (c) of this section 
have been complied with.
    (c) No results of a pulmonary function study shall constitute 
evidence of the presence or absence of a respiratory or pulmonary 
impairment unless it is conducted and reported in accordance with the 
requirements of this section and Appendix B to this part. In the 
absence of evidence to the contrary, compliance with the requirements 
of Appendix B shall be presumed. In the case of a deceased miner, 
special consideration shall be given to noncomplying tests if, in the 
opinion of the adjudication officer, the only available tests 
demonstrate technically valid results obtained with good cooperation of 
the miner.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 718.104  Report of physical examinations.

    (a) A report of any physical examination conducted in connection 
with a claim shall be prepared on a medical report form supplied by the 
Office or in a manner containing substantially the same information. 
Any such report shall include the following information and test 
results:
    (1) The miner's medical and employment history;
    (2) All manifestations of chronic respiratory disease;
    (3) Any pertinent findings not specifically listed on the form;
    (4) If heart disease secondary to lung disease is found, all 
symptoms and significant findings;
    (5) The results of a chest X-ray conducted and interpreted as 
required by Sec. 718.102; and
    (6) The results of a pulmonary function test conducted and reported 
as required by Sec. 718.103.
    (b) In addition to the requirements of paragraph (a), a report of 
physical examination may be based on any other procedures such as 
electrocardiogram, blood-gas studies conducted and reported as required 
by Sec. 718.105, and other blood analyses which, in the physician's 
opinion, aid in his or her evaluation of the miner.
    (c) In the case of a deceased miner, a report prepared by a 
physician who is unavailable, which fails to meet the criteria of 
paragraph (a), may be given appropriate consideration and weight by the 
adjudicator in light of all relevant evidence provided no report which 
does comply with this section is available.
    (d) Treating physician. The medical opinion of a miner's treating 
physician may be entitled to controlling weight in determining whether 
the miner is, or was, totally disabled by pneumoconiosis or died due to 
pneumoconiosis. The adjudication officer shall take into consideration 
the following factors in weighing the opinion of a treating physician:
    (1) Nature of relationship. The opinion of a physician who has 
treated the miner for respiratory or pulmonary conditions is entitled 
to more weight than a physician who has treated the miner for non-
respiratory conditions;
    (2) Duration of relationship. The length of the treatment 
relationship demonstrates whether the physician has observed the miner 
long enough to obtain a superior understanding of his or her condition;
    (3) Frequency of treatment. The frequency of physician-patient 
visits demonstrates whether the physician has observed the miner often 
enough to obtain a superior understanding of his or her condition; and
    (4) Extent of treatment. The types of testing and examinations 
conducted during the treatment relationship demonstrate whether the 
physician has obtained superior and relevant information concerning the 
miner's condition.
    (5) Whether controlling weight is given to the opinion of a miner's 
treating physician shall also be based on the credibility of the 
physician's opinion in light of its reasoning and documentation, other 
relevant evidence and the record as a whole.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 718.105  Arterial blood-gas studies.

    (a) Blood-gas studies are performed to detect an impairment in the 
process of alveolar gas exchange. This defect will manifest itself 
primarily as a fall in arterial oxygen tension either at rest or during 
exercise. No blood-gas study shall be performed if medically 
contraindicated.
    (b) A blood-gas study shall initially be administered at rest and 
in a sitting position. If the results of the blood-gas test at rest do 
not satisfy the requirements of Appendix C to this part, an exercise 
blood-gas test shall be offered to the miner unless medically 
contraindicated. If an exercise blood-gas test is administered, blood 
shall be drawn during exercise.
    (c) Any report of a blood-gas study submitted in connection with a 
claim shall specify:
    (1) Date and time of test;
    (2) Altitude and barometric pressure at which the test was 
conducted;
    (3) Name and DOL claim number of the claimant;
    (4) Name of technician;
    (5) Name and signature of physician supervising the study;
    (6) The recorded values for pCO2, pO2, and pH, which have been 
collected simultaneously (specify values at rest and, if performed, 
during exercise);
    (7) Duration and type of exercise;
    (8) Pulse rate at the time the blood sample was drawn;
    (9) Time between drawing of sample and analysis of sample; and
    (10) Whether equipment was calibrated before and after each test.
    (d) If one or more blood-gas studies producing results which meet 
the appropriate table in Appendix C is administered during a 
hospitalization which ends in the miner's death, then any such study 
must be accompanied by a physician's report establishing that the test 
results were produced by a chronic respiratory or pulmonary condition 
related to coal mine dust exposure, and not by a disease unrelated to 
such exposure. Failure to produce such a report will prevent reliance 
on the blood-gas study as evidence that the miner was totally disabled 
at death.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 718.106  Autopsy; biopsy.

    (a) A report of an autopsy or biopsy submitted in connection with a 
claim shall include a detailed gross macroscopic and microscopic 
description of the lungs or visualized portion of a lung. If a surgical 
procedure has been performed to obtain a portion of a lung, the 
evidence shall include a copy of the surgical note and the pathology 
report of the gross and microscopic examination of the surgical 
specimen. If an autopsy has been performed, a complete copy of the 
autopsy report shall be submitted to the Office.
    (b) In the case of a miner who died prior to March 31, 1980, an 
autopsy or

[[Page 3376]]

biopsy report shall be considered even when the report does not 
substantially comply with the requirements of this section. A 
noncomplying report concerning a miner who died prior to March 31, 
1980, shall be accorded the appropriate weight in light of all relevant 
evidence.


Sec. 718.107  Other medical evidence.

    (a) The results of any medically acceptable test or procedure 
reported by a physician and not addressed in this subpart, which tends 
to demonstrate the presence or absence of pneumoconiosis, the sequelae 
of pneumoconiosis or a respiratory impairment, may be submitted in 
connection with a claim and shall be given appropriate consideration.
    (b) The party submitting the test or procedure pursuant to this 
section bears the burden to demonstrate that the test or procedure is 
medically acceptable and relevant to establishing or refuting a 
claimant's entitlement to benefits.

Subpart C--Determining Entitlement to Benefits


Sec. 718.201  Definition of pneumoconiosis.

    (a) For the purpose of the Act, ``pneumoconiosis'' means a chronic 
dust disease of the lung and its sequelae, including respiratory and 
pulmonary impairments, arising out of coal mine employment. This 
definition includes both medical, or ``clinical,'' pneumoconiosis and 
statutory, or ``legal,'' pneumoconiosis.
    (1) Clinical pneumoconiosis. ``Clinical pneumoconiosis'' consists 
of those diseases, recognized by the medical community as 
pneumoconioses, i.e., the conditions characterized by permanent 
deposition of substantial amounts of particulate matter in the lungs 
and the fibrotic reaction of the lung tissue to that deposition caused 
by dust exposure in coal mine employment. This definition includes, but 
is not limited to, coal workers' pneumoconiosis, anthracosilicosis, 
anthracosis, anthrosilicosis, massive pulmonary fibrosis, silicosis or 
silicotuberculosis, arising out of coal mine employment.
    (2) Legal pneumoconiosis. ``Legal pneumoconiosis'' includes any 
chronic lung disease or impairment and its sequelae arising out of coal 
mine employment. This definition includes, but is not limited to, any 
chronic restrictive or obstructive pulmonary disease arising out of 
coal mine employment.
    (b) For purposes of this section, a disease ``arising out of coal 
mine employment'' includes any chronic pulmonary disease or respiratory 
or pulmonary impairment significantly related to, or substantially 
aggravated by, dust exposure in coal mine employment.
    (c) For purposes of this definition, ``pneumoconiosis'' is 
recognized as a latent and progressive disease which may first become 
detectable only after the cessation of coal mine dust exposure.


Sec. 718.202  Determining the existence of pneumoconiosis.

    (a) A finding of the existence of pneumoconiosis may be made as 
follows:
    (1) A chest X-ray conducted and classified in accordance with 
Sec. 718.102 may form the basis for a finding of the existence of 
pneumoconiosis. Except as otherwise provided in this section, where two 
or more X-ray reports are in conflict, in evaluating such X-ray reports 
consideration shall be given to the radiological qualifications of the 
physicians interpreting such X-rays.
    (i) In all claims filed before January 1, 1982, where there is 
other evidence of pulmonary or respiratory impairment, a Board-
certified or Board-eligible radiologist's interpretation of a chest X-
ray shall be accepted by the Office if the X-ray is in compliance with 
the requirements of Sec. 718.102 and if such X-ray has been taken by a 
radiologist or qualified radiologic technologist or technician and 
there is no evidence that the claim has been fraudulently represented. 
However, these limitations shall not apply to any claim filed on or 
after January 1, 1982.
    (ii) The following definitions shall apply when making a finding in 
accordance with this paragraph.
    (A) The term other evidence means medical tests such as blood-gas 
studies, pulmonary function studies or physical examinations or medical 
histories which establish the presence of a chronic pulmonary, 
respiratory or cardio-pulmonary condition, and in the case of a 
deceased miner, in the absence of medical evidence to the contrary, 
affidavits of persons with knowledge of the miner's physical condition.
    (B) Pulmonary or respiratory impairment means inability of the 
human respiratory apparatus to perform in a normal manner one or more 
of the three components of respiration, namely, ventilation, perfusion 
and diffusion.
    (C) Board-certified means certification in radiology or diagnostic 
roentgenology by the American Board of Radiology, Inc. or the American 
Osteopathic Association.
    (D) Board-eligible means the successful completion of a formal 
accredited residency program in radiology or diagnostic roentgenology.
    (E) Certified `B' reader or `B' reader means a physician who has 
demonstrated proficiency in evaluating chest roentgenograms for 
roentgenographic quality and in the use of the ILO-U/C classification 
for interpreting chest roentgenograms for pneumoconiosis and other 
diseases by taking and passing a specially designed proficiency 
examination given on behalf of or by the Appalachian Laboratory for 
Occupational Safety and Health. See 42 CFR 37.51(b)(2).
    (F) Qualified radiologic technologist or technician means an 
individual who is either certified as a registered technologist by the 
American Registry of Radiologic Technologists or licensed as a 
radiologic technologist by a state licensing board.
    (2) A biopsy or autopsy conducted and reported in compliance with 
Sec. 718.106 may be the basis for a finding of the existence of 
pneumoconiosis. A finding in an autopsy or biopsy of anthracotic 
pigmentation, however, shall not be sufficient, by itself, to establish 
the existence of pneumoconiosis. A report of autopsy shall be accepted 
unless there is evidence that the report is not accurate or that the 
claim has been fraudulently represented.
    (3) If the presumptions described in Secs. 718.304, 718.305 or 
718.306 are applicable, it shall be presumed that the miner is or was 
suffering from pneumoconiosis.
    (4) A determination of the existence of pneumoconiosis may also be 
made if a physician, exercising sound medical judgment, notwithstanding 
a negative X-ray, finds that the miner suffers or suffered from 
pneumoconiosis as defined in Sec. 718.201. Any such finding shall be 
based on objective medical evidence such as blood-gas studies, 
electrocardiograms, pulmonary function studies, physical performance 
tests, physical examination, and medical and work histories. Such a 
finding shall be supported by a reasoned medical opinion.
    (b) No claim for benefits shall be denied solely on the basis of a 
negative chest X-ray.
    (c) A determination of the existence of pneumoconiosis shall not be 
made solely on the basis of a living miner's statements or testimony. 
Nor shall such a determination be made upon a claim involving a 
deceased miner filed on or after January 1, 1982, solely based upon the 
affidavit(s) (or equivalent sworn testimony) of the claimant and/or his 
or

[[Page 3377]]

her dependents who would be eligible for augmentation of the claimant's 
benefits if the claim were approved.


Sec. 718.203  Establishing relationship of pneumoconiosis to coal mine 
employment.

    (a) In order for a claimant to be found eligible for benefits under 
the Act, it must be determined that the miner's pneumoconiosis arose at 
least in part out of coal mine employment. The provisions in this 
section set forth the criteria to be applied in making such a 
determination.
    (b) If a miner who is suffering or suffered from pneumoconiosis was 
employed for ten years or more in one or more coal mines, there shall 
be a rebuttable presumption that the pneumoconiosis arose out of such 
employment.
    (c) If a miner who is suffering or suffered from pneumoconiosis was 
employed less than ten years in the nation's coal mines, it shall be 
determined that such pneumoconiosis arose out of that employment only 
if competent evidence establishes such a relationship.


Sec. 718.204  Total disability and disability causation defined; 
criteria for determining total disability and total disability due to 
pneumoconiosis.

    (a) General. Benefits are provided under the Act for or on behalf 
of miners who are totally disabled due to pneumoconiosis, or who were 
totally disabled due to pneumoconiosis at the time of death. For 
purposes of this section, any nonpulmonary or nonrespiratory condition 
or disease, which causes an independent disability unrelated to the 
miner's pulmonary or respiratory disability, shall not be considered in 
determining whether a miner is totally disabled due to pneumoconiosis. 
If, however, a nonpulmonary or nonrespiratory condition or disease 
causes a chronic respiratory or pulmonary impairment, that condition or 
disease shall be considered in determining whether the miner is or was 
totally disabled due to pneumoconiosis.
    (b)(1) Total disability defined. A miner shall be considered 
totally disabled if the irrebuttable presumption described in 
Sec. 718.304 applies. If that presumption does not apply, a miner shall 
be considered totally disabled if the miner has a pulmonary or 
respiratory impairment which, standing alone, prevents or prevented the 
miner:
    (i) From performing his or her usual coal mine work; and
    (ii) From engaging in gainful employment in the immediate area of 
his or her residence requiring the skills or abilities comparable to 
those of any employment in a mine or mines in which he or she 
previously engaged with some regularity over a substantial period of 
time.
    (2) Medical criteria. In the absence of contrary probative 
evidence, evidence which meets the standards of either paragraphs 
(b)(2) (i), (ii), (iii), or (iv) of this section shall establish a 
miner's total disability:
    (i) Pulmonary function tests showing values equal to or less than 
those listed in Table B1 (Males) or Table B2 (Females) in Appendix B to 
this part for an individual of the miner's age, sex, and height for the 
FEV1 test; if, in addition, such tests also reveal the values specified 
in either paragraph (b)(2)(i) (A) or (B) or (C) of this section:
    (A) Values equal to or less than those listed in Table B3 (Males) 
or Table B4 (Females) in Appendix B of this part, for an individual of 
the miner's age, sex, and height for the FVC test, or
    (B) Values equal to or less than those listed in Table B5 (Males) 
or Table B6 (Females) in Appendix B to this part, for an individual of 
the miner's age, sex, and height for the MVV test, or
    (C) A percentage of 55 or less when the results of the FEV1 test 
are divided by the results of the FVC test (FEV1/FVC equal to or less 
than 55%), or
    (ii) Arterial blood-gas tests show the values listed in Appendix C 
to this part, or
    (iii) The miner has pneumoconiosis and has been shown by the 
medical evidence to be suffering from cor pulmonale with right-sided 
congestive heart failure, or
    (iv) A physician exercising reasoned medical judgment, based on 
medically acceptable clinical and laboratory diagnostic techniques, 
concludes that a miner's respiratory or pulmonary condition prevents or 
prevented the miner from engaging in employment as described in 
paragraph (b)(1) of this section.
    (c)(1) Total disability due to pneumoconiosis defined. A miner 
shall be considered totally disabled due to pneumoconiosis if 
pneumoconiosis, as defined in Sec. 718.201, is a substantially 
contributing cause of the miner's totally disabling respiratory or 
pulmonary impairment. Pneumoconiosis is a ``substantially contributing 
cause'' of the miner's disability if it:
    (i) Has an adverse effect on the miner's respiratory or pulmonary 
condition; or
    (ii) Worsens a totally disabling respiratory or pulmonary 
impairment which is caused by a disease or exposure unrelated to coal 
mine employment.
    (2) Except as provided in Sec. 718.305 and paragraph (b)(2)(iii) of 
this section, proof that the miner suffers or suffered from a totally 
disabling respiratory or pulmonary impairment as defined in paragraphs 
(b)(2)(i), (b)(2)(ii), (b)(2)(iv) and (d) of this section shall not, by 
itself, be sufficient to establish that the miner's impairment is or 
was due to pneumoconiosis. Except as provided in paragraph (d), the 
cause or causes of a miner's total disability shall be established by 
means of a physician's documented and reasoned medical report.
    (d) Lay evidence. In establishing total disability, lay evidence 
may be used in the following cases:
    (1) In a case involving a deceased miner in which the claim was 
filed prior to January 1, 1982, affidavits (or equivalent sworn 
testimony) from persons knowledgeable of the miner's physical condition 
shall be sufficient to establish total (or under Sec. 718.306 partial) 
disability due to pneumoconiosis if no medical or other relevant 
evidence exists which addresses the miner's pulmonary or respiratory 
condition.
    (2) In a case involving a survivor's claim filed on or after 
January 1, 1982, but prior to June 30, 1982, which is subject to 
Sec. 718.306, affidavits (or equivalent sworn testimony) from persons 
knowledgeable of the miner's physical condition shall be sufficient to 
establish total or partial disability due to pneumoconiosis if no 
medical or other relevant evidence exists which addresses the miner's 
pulmonary or respiratory condition; however, such a determination shall 
not be based solely upon the affidavits or testimony of the claimant 
and/or his or her dependents who would be eligible for augmentation of 
the claimant's benefits if the claim were approved.
    (3) In a case involving a deceased miner whose claim was filed on 
or after January 1, 1982, affidavits (or equivalent sworn testimony) 
from persons knowledgeable of the miner's physical condition shall be 
sufficient to establish total disability due to pneumoconiosis if no 
medical or other relevant evidence exists which addresses the miner's 
pulmonary or respiratory condition; however, such a determination shall 
not be based solely upon the affidavits or testimony of any person who 
would be eligible for benefits (including augmented benefits) if the 
claim were approved.
    (4) Statements made before death by a deceased miner about his or 
her physical condition are relevant and shall be considered in making a

[[Page 3378]]

determination as to whether the miner was totally disabled at the time 
of death.
    (5) In the case of a living miner's claim, a finding of total 
disability due to pneumoconiosis shall not be made solely on the 
miner's statements or testimony.
    (e) In determining total disability to perform usual coal mine 
work, the following shall apply in evaluating the miner's employment 
activities:
    (1) In the case of a deceased miner, employment in a mine at the 
time of death shall not be conclusive evidence that the miner was not 
totally disabled. To disprove total disability, it must be shown that 
at the time the miner died, there were no changed circumstances of 
employment indicative of his or her reduced ability to perform his or 
her usual coal mine work.
    (2) In the case of a living miner, proof of current employment in a 
coal mine shall not be conclusive evidence that the miner is not 
totally disabled unless it can be shown that there are no changed 
circumstances of employment indicative of his or her reduced ability to 
perform his or her usual coal mine work.
    (3) Changed circumstances of employment indicative of a miner's 
reduced ability to perform his or her usual coal mine work may include 
but are not limited to:
    (i) The miner's reduced ability to perform his or her customary 
duties without help; or
    (ii) The miner's reduced ability to perform his or her customary 
duties at his or her usual levels of rapidity, continuity or 
efficiency; or
    (iii) The miner's transfer by request or assignment to less 
vigorous duties or to duties in a less dusty part of the mine.


Sec. 718.205  Death due to pneumoconiosis.

    (a) Benefits are provided to eligible survivors of a miner whose 
death was due to pneumoconiosis. In order to receive benefits, the 
claimant must prove that:
    (1) The miner had pneumoconiosis (see Sec. 718.202);
    (2) The miner's pneumoconiosis arose out of coal mine employment 
(see Sec. 718.203); and
    (3) The miner's death was due to pneumoconiosis as provided by this 
section.
    (b) For the purpose of adjudicating survivors' claims filed prior 
to January 1, 1982, death will be considered due to pneumoconiosis if 
any of the following criteria is met:
    (1) Where competent medical evidence established that the miner's 
death was due to pneumoconiosis, or
    (2) Where death was due to multiple causes including pneumoconiosis 
and it is not medically feasible to distinguish which disease caused 
death or the extent to which pneumoconiosis contributed to the cause of 
death, or
    (3) Where the presumption set forth at Sec. 718.304 is applicable, 
or
    (4) Where either of the presumptions set forth at Sec. 718.303 or 
Sec. 718.305 is applicable and has not been rebutted.
    (5) Where the cause of death is significantly related to or 
aggravated by pneumoconiosis.
    (c) For the purpose of adjudicating survivors' claims filed on or 
after January 1, 1982, death will be considered to be due to 
pneumoconiosis if any of the following criteria is met:
    (1) Where competent medical evidence establishes that 
pneumoconiosis was the cause of the miner's death, or
    (2) Where pneumoconiosis was a substantially contributing cause or 
factor leading to the miner's death or where the death was caused by 
complications of pneumoconiosis, or
    (3) Where the presumption set forth at Sec. 718.304 is applicable.
    (4) However, survivors are not eligible for benefits where the 
miner's death was caused by a traumatic injury or the principal cause 
of death was a medical condition not related to pneumoconiosis, unless 
the evidence establishes that pneumoconiosis was a substantially 
contributing cause of death.
    (5) Pneumoconiosis is a ``substantially contributing cause'' of a 
miner's death if it hastens the miner's death.
    (d) To minimize the hardships to potentially entitled survivors due 
to the disruption of benefits upon the miner's death, survivors' claims 
filed on or after January 1, 1982, shall be adjudicated on an expedited 
basis in accordance with the following procedures. The initial burden 
is upon the claimant, with the assistance of the district director, to 
develop evidence which meets the requirements of paragraph (c) of this 
section. Where the initial medical evidence appears to establish that 
death was due to pneumoconiosis, the survivor will receive benefits 
unless the weight of the evidence as subsequently developed by the 
Department or the responsible operator establishes that the miner's 
death was not due to pneumoconiosis as defined in paragraph (c). 
However, no such benefits shall be found payable before the party 
responsible for the payment of such benefits shall have had a 
reasonable opportunity for the development of rebuttal evidence. See 
Sec. 725.414 concerning the operator's opportunity to develop evidence 
prior to an initial determination.


Sec. 718.206  Effect of findings by persons or agencies.

    Decisions, statements, reports, opinions, or the like, of agencies, 
organizations, physicians or other individuals, about the existence, 
cause, and extent of a miner's disability, or the cause of a miner's 
death, are admissible. If properly submitted, such evidence shall be 
considered and given the weight to which it is entitled as evidence 
under all the facts before the adjudication officer in the claim.

Subpart D--Presumptions Applicable to Eligibility Determinations


Sec. 718.301  Establishing length of employment as a miner.

    The presumptions set forth in Secs. 718.302, 718.303, 718.305 and 
718.306 apply only if a miner worked in one or more coal mines for the 
number of years required to invoke the presumption. The length of the 
miner's coal mine work history must be computed as provided by 20 CFR 
725.101(a)(32).


Sec. 718.302  Relationship of pneumoconiosis to coal mine employment.

    If a miner who is suffering or suffered from pneumoconiosis was 
employed for ten years or more in one or more coal mines, there shall 
be a rebuttable presumption that the pneumoconiosis arose out of such 
employment. (See Sec. 718.203.)


Sec. 718.303  Death from a respirable disease.

    (a)(1) If a deceased miner was employed for ten or more years in 
one or more coal mines and died from a respirable disease, there shall 
be a rebuttable presumption that his or her death was due to 
pneumoconiosis.
    (2) Under this presumption, death shall be found due to a 
respirable disease in any case in which the evidence establishes that 
death was due to multiple causes, including a respirable disease, and 
it is not medically feasible to distinguish which disease caused death 
or the extent to which the respirable disease contributed to the cause 
of death.
    (b) The presumption of paragraph (a) of this section may be 
rebutted by a showing that the deceased miner did not have 
pneumoconiosis, that his or her death was not due to pneumoconiosis or 
that pneumoconiosis did not contribute to his or her death.
    (c) This section is not applicable to any claim filed on or after 
January 1, 1982.

[[Page 3379]]

Sec. 718.304  Irrebuttable presumption of total disability or death due 
to pneumoconiosis.

    There is an irrebuttable presumption that a miner is totally 
disabled due to pneumoconiosis, that a miner's death was due to 
pneumoconiosis or that a miner was totally disabled due to 
pneumoconiosis at the time of death, if such miner is suffering or 
suffered from a chronic dust disease of the lung which:
    (a) When diagnosed by chest X-ray (see Sec. 718.202 concerning the 
standards for X-rays and the effect of interpretations of X-rays by 
physicians) yields one or more large opacities (greater than 1 
centimeter in diameter) and would be classified in Category A, B, or C 
in:
    (1) The ILO-U/C International Classification of Radiographs of the 
Pneumoconioses, 1971, or subsequent revisions thereto; or
    (2) The International Classification of the Radiographs of the 
Pneumoconioses of the International Labour Office, Extended 
Classification (1968) (which may be referred to as the ``ILO 
Classification (1968)''); or
    (3) The Classification of the Pneumoconioses of the Union 
Internationale Contra Cancer/Cincinnati (1968) (which may be referred 
to as the ``UICC/Cincinnati (1968) Classification''); or
    (b) When diagnosed by biopsy or autopsy, yields massive lesions in 
the lung; or
    (c) When diagnosed by means other than those specified in 
paragraphs (a) and (b) of this section, would be a condition which 
could reasonably be expected to yield the results described in 
paragraph (a) or (b) of this section had diagnosis been made as therein 
described: Provided, however, That any diagnosis made under this 
paragraph shall accord with acceptable medical procedures.


Sec. 718.305  Presumption of pneumoconiosis.

    (a) If a miner was employed for fifteen years or more in one or 
more underground coal mines, and if there is a chest X-ray submitted in 
connection with such miner's or his or her survivor's claim and it is 
interpreted as negative with respect to the requirements of 
Sec. 718.304, and if other evidence demonstrates the existence of a 
totally disabling respiratory or pulmonary impairment, then there shall 
be a rebuttable presumption that such miner is totally disabled due to 
pneumoconiosis, that such miner's death was due to pneumoconiosis, or 
that at the time of death such miner was totally disabled by 
pneumoconiosis. In the case of a living miner's claim, a spouse's 
affidavit or testimony may not be used by itself to establish the 
applicability of the presumption. The Secretary shall not apply all or 
a portion of the requirement of this paragraph that the miner work in 
an underground mine where it is determined that conditions of the 
miner's employment in a coal mine were substantially similar to 
conditions in an underground mine. The presumption may be rebutted only 
by establishing that the miner does not, or did not, have 
pneumoconiosis, or that his or her respiratory or pulmonary impairment 
did not arise out of, or in connection with, employment in a coal mine.
    (b) In the case of a deceased miner, where there is no medical or 
other relevant evidence, affidavits of persons having knowledge of the 
miner's condition shall be considered to be sufficient to establish the 
existence of a totally disabling respiratory or pulmonary impairment 
for purposes of this section.
    (c) The determination of the existence of a totally disabling 
respiratory or pulmonary impairment, for purposes of applying the 
presumption described in this section, shall be made in accordance with 
Sec. 718.204.
    (d) Where the cause of death or total disability did not arise in 
whole or in part out of dust exposure in the miner's coal mine 
employment or the evidence establishes that the miner does not or did 
not have pneumoconiosis, the presumption will be considered rebutted. 
However, in no case shall the presumption be considered rebutted on the 
basis of evidence demonstrating the existence of a totally disabling 
obstructive respiratory or pulmonary disease of unknown origin.
    (e) This section is not applicable to any claim filed on or after 
January 1, 1982.


Sec. 718.306  Presumption of entitlement applicable to certain death 
claims.

    (a) In the case of a miner who died on or before March 1, 1978, who 
was employed for 25 or more years in one or more coal mines prior to 
June 30, 1971, the eligible survivors of such miner whose claims have 
been filed prior to June 30, 1982, shall be entitled to the payment of 
benefits, unless it is established that at the time of death such miner 
was not partially or totally disabled due to pneumoconiosis. Eligible 
survivors shall, upon request, furnish such evidence as is available 
with respect to the health of the miner at the time of death, and the 
nature and duration of the miner's coal mine employment.
    (b) For the purpose of this section, a miner will be considered to 
have been ``partially disabled'' if he or she had reduced ability to 
engage in work as defined in Sec. 718.204(b).
    (c) In order to rebut this presumption the evidence must 
demonstrate that the miner's ability to perform work as defined in 
Sec. 718.204(b) was not reduced at the time of his or her death or that 
the miner did not have pneumoconiosis.
    (d) None of the following items, by itself, shall be sufficient to 
rebut the presumption:
    (1) Evidence that a deceased miner was employed in a coal mine at 
the time of death;
    (2) Evidence pertaining to a deceased miner's level of earnings 
prior to death;
    (3) A chest X-ray interpreted as negative for the existence of 
pneumoconiosis;
    (4) A death certificate which makes no mention of pneumoconiosis.

Appendix A to Part 718-Standards for Administration and Interpretation 
of Chest Roentgenograms (X-rays)

    The following standards are established in accordance with 
sections 402(f)(1)(D) and 413(b) of the Act. They were developed in 
consultation with the National Institute for Occupational Safety and 
Health. These standards are promulgated for the guidance of 
physicians and medical technicians to insure that uniform procedures 
are used in administering and interpreting X-rays and that the best 
available medical evidence will be submitted in connection with a 
claim for black lung benefits. If it is established that one or more 
standards have not been met, the claims adjudicator may consider 
such fact in determining the evidentiary weight to be assigned to 
the physician's report of an X-ray.
    (1) Every chest roentgenogram shall be a single postero-anterior 
projection at full inspiration on a 14 by 17 inch film. Additional 
chest films or views shall be obtained if they are necessary for 
clarification and classification. The film and cassette shall be 
capable of being positioned both vertically and horizontally so that 
the chest roentgenogram will include both apices and costophrenic 
angles. If a miner is too large to permit the above requirements, 
then a projection with minimum loss of costophrenic angle shall be 
made.
    (2) Miners shall be disrobed from the waist up at the time the 
roentgenogram is given. The facility shall provide a dressing area 
and, for those miners who wish to use one, the facility shall 
provide a clean gown. Facilities shall be heated to a comfortable 
temperature.
    (3) Roentgenograms shall be made only with a diagnostic X-ray 
machine having a rotating anode tube with a maximum of a 2 mm source 
(focal spot).
    (4) Except as provided in paragraph (5), roentgenograms shall be 
made with units having generators which comply with the following: 
(a) the generators of existing roentgenographic units acquired by 
the examining facility prior to July 27, 1973, shall have a minimum 
rating of 200 mA at

[[Page 3380]]

100 kVp; (b) generators of units acquired subsequent to that date 
shall have a minimum rating of 300 mA at 125 kVp.

    Note: A generator with a rating of 150 kVp is recommended.

    (5) Roentgenograms made with battery-powered mobile or portable 
equipment shall be made with units having a minimum rating of 100 mA 
at 110 kVp at 500 Hz, or 200 mA at 110 kVp at 60 Hz.
    (6) Capacitor discharge, and field emission units may be used.
    (7) Roentgenograms shall be given only with equipment having a 
beam-limiting device which does not cause large unexposed 
boundaries. The use of such a device shall be discernible from an 
examination of the roentgenogram.
    (8) To insure high quality chest roentgenograms:
    (i) The maximum exposure time shall not exceed 1/20 of a second 
except that with single phase units with a rating less than 300 mA 
at 125 kVp and subjects with chest over 28 cm postero-anterior, the 
exposure may be increased to not more than 1/10 of a second;
    (ii) The source or focal spot to film distance shall be at least 
6 feet;
    (iii) Only medium-speed film and medium-speed intensifying 
screens shall be used;
    (iv) Film-screen contact shall be maintained and verified at 6-
month or shorter intervals;
    (v) Intensifying screens shall be inspected at least once a 
month and cleaned when necessary by the method recommended by the 
manufacturer;
    (vi) All intensifying screens in a cassette shall be of the same 
type and made by the same manufacturer;
    (vii) When using over 90 kV, a suitable grid or other means of 
reducing scattered radiation shall be used;
    (viii) The geometry of the radiographic system shall insure that 
the central axis (ray) of the primary beam is perpendicular to the 
plane of the film surface and impinges on the center of the film.
    (9) Radiographic processing:
    (i) Either automatic or manual film processing is acceptable. A 
constant time-temperature technique shall be meticulously employed 
for manual processing.
    (ii) If mineral or other impurities in the processing water 
introduce difficulty in obtaining a high-quality roentgenogram, a 
suitable filter or purification system shall be used.
    (10) Before the miner is advised that the examination is 
concluded, the roentgenogram shall be processed and inspected and 
accepted for quality by the physician, or if the physician is not 
available, acceptance may be made by the radiologic technologist. In 
a case of a substandard roentgenogram, another shall be made 
immediately.
    (11) An electric power supply shall be used which complies with 
the voltage, current, and regulation specified by the manufacturer 
of the machine.
    (12) A densitometric test object may be required on each 
roentgenogram for an objective evaluation of film quality at the 
discretion of the Department of Labor.
    (13) Each roentgenogram made hereunder shall be permanently and 
legibly marked with the name and address of the facility at which it 
is made, the miner's DOL claim number, the date of the 
roentgenogram, and left and right side of film. No other identifying 
markings shall be recorded on the roentgenogram.

Appendix B to Part 718--Standards for Administration and Interpretation 
of Pulmonary Function Tests

Tables B1, B2, B3, B4, B5, B6

    The following standards are established in accordance with 
section 402(f)(1)(D) of the Act. They were developed in consultation 
with the National Institute for Occupational Safety and Health 
(NIOSH). These standards are promulgated for the guidance of 
physicians and medical technicians to insure that uniform procedures 
are used in administering and interpreting ventilatory function 
tests and that the best available medical evidence will be submitted 
in support of a claim for black lung benefits. If it is established 
that one or more standards have not been met, the claims adjudicator 
may consider such fact in determining the evidentiary weight to be 
given to the results of the ventilatory function tests.
    (1) Instruments to be used for the administration of pulmonary 
function tests shall be approved by NIOSH and shall conform to the 
following criteria:
    (i) The instrument shall be accurate within +/-50 ml or within 
+/-3 percent of reading, whichever is greater.
    (ii) The instrument shall be capable of measuring vital capacity 
from 0 to 7 liters BTPS.
    (iii) The instrument shall have a low inertia and offer low 
resistance to airflow such that the resistance to airflow at 12 
liters per second must be less than 1.5 cm H2O/liter/sec.
    (iv) The zero time point for the purpose of timing the FEV1 
shall be determined by extrapolating the steepest portion of the 
volume-time curve back to the maximal inspiration volume or by an 
equivalent method.
    (v) Instruments incorporating measurements of airflow to 
determine volume shall conform to the same volume accuracy stated in 
subparagraph (1)(i) of this Appendix B when presented with flow 
rates from at least 0 to 12 liters per second.
    (vi) The instrument or user of the instrument must have a means 
of correcting volumes to body temperature saturated with water vapor 
(BTPS) under conditions of varying ambient spirometer temperatures 
and barometric pressures.
    (vii) The instrument used shall provide a tracing of either flow 
versus volume or volume versus time during the entire forced 
expiration and volume versus time during the MVV maneuver. A tracing 
is necessary to determine whether the patient has performed the test 
properly. The tracing must be of sufficient size that hand 
measurements may be made within the requirement of subparagraph 
(1)(i) of this Appendix B. If a paper record is made it must have a 
paper speed of at least 2 cm/sec and a volume sensitivity of at 
least 10.0 mm of chart per liter of volume. The recorder tracing 
must display the entire FVC maneuver at a constant speed for at 
least 10 seconds after the onset of exhalation. This constant speed 
must be reached prior to the onset of exhalation.
    (viii) The instrument shall be capable of accumulating volume 
for a minimum of 10 seconds after the onset of exhalation.
    (ix) The forced expiratory volume in 1 sec (FEV1) measurement 
shall comply with the accuracy requirements stated in subparagraph 
(1)(i) of this Appendix B. That is, they shall be accurately 
measured to within <plus-minus> 50 ml or with <plus-minus> 3 percent 
of reading, whichever is greater.
    (x) The instrument must be capable of being calibrated in the 
field with respect to the FEV1. This calibration of the FEV1 may be 
done either directly or indirectly through volume and time base 
measurements. The volume calibration source shall provide a volume 
displacement of at least 3 liters and shall be accurate to within 
<plus-minus> 30 ml.
    (xi) For measuring maximum voluntary ventilation (MVV) the 
instrument shall have a response which is flat within <plus-minus> 
10 percent up to 4 Hz at flow rates up to 12 liters per second over 
the volume range. The time for exhaled volume integration or 
recording shall be no less than 12 sec. and no more than 15 sec. The 
indicated time shall be accurate to within <plus-minus> 3 percent.
    A recording of the spirometer tracing is required, and the 
volume sensitivity shall be such that 10 mm or more deflection 
corresponds to 1 liter volume.
    (2) The administration of pulmonary function tests shall conform 
to the following criteria:
    (i) Tests shall not be performed during or soon after an acute 
respiratory illness.
    (ii) For the FEV1 and FVC, use of a nose clip is required. The 
procedures shall be explained in simple terms to the patient who 
shall be instructed to loosen any tight clothing and stand in front 
of the apparatus. The subject may sit, or stand, but care should be 
taken on repeat testing that the same position be used. Particular 
attention shall be given to insure that the chin is slightly 
elevated with the neck slightly extended. The patient shall be 
instructed to make a full inspiration from the spirometer, using a 
normal breathing pattern and then blow into the apparatus, without 
interruption, as hard, fast, and completely as possible. At least 
three forced expirations shall be carried out. During the maneuvers, 
the patient shall be observed for compliance with instructions. The 
expirations shall be checked visually for reproducibility from the 
flow-volume or volume-time tracings. The effort shall be judged 
unacceptable when the patient:
    (A) Has not reached full inspiration preceding the forced 
expiration; or
    (B) Has not used maximal effort during the entire forced 
expiration; or
    (C) Has not continued the expiration for at least 5 sec. or 
until an obvious plateau in the volume-time curve has occurred; or
    (D) Has coughed or closed his glottis; or
    (E) Has an obstructed mouthpiece or a leak around the mouthpiece 
(obstruction due to tongue being placed in front of mouthpiece, 
false teeth falling in front of mouthpiece, etc.); or
    (F) Has an unsatisfactory start of expiration, one characterized 
by excessive

[[Page 3381]]

hesitation (or false starts), and therefore not allowing back 
extrapolation of time 0 (extrapolated volume on the volume-time 
tracing must be less than 10 percent of the FVC); or
    (G) Has an excessive variability between the three acceptable 
curves. The variation between the two largest FEV1's of the three 
acceptable tracings should not exceed 5 percent of the largest FEV1 
or 100 ml, whichever is greater.
    (iii) For the MVV, the subject shall be instructed before 
beginning the test that he or she will be asked to breathe as deeply 
and as rapidly as possible for approximately 15 seconds.
    The test shall be performed with the subject in the standing 
position, if possible. Care shall be taken on repeat testing that 
the same position be used. The subject shall breathe normally into 
the mouthpiece of the apparatus for 10 to 15 seconds to become 
accustomed to the system. The subject shall then be instructed to 
breathe as deeply and as rapidly as possible, and shall be 
continually encouraged during the remainder of the maneuver. Subject 
shall continue the maneuver for 15 seconds. At least 5 minutes of 
rest shall be allowed between maneuvers. At least three MVV's shall 
be carried out. (But see Sec. 718.103(b).) During the maneuvers the 
patient shall be observed for compliance with instructions. The 
effort shall be judged unacceptable when the patient:
    (A) Has not maintained consistent effort for at least 12 to 15 
seconds; or
    (B) Has coughed or closed his glottis; or
    (C) Has an obstructed mouthpiece or a leak around the mouthpiece 
(obstruction due to tongue being placed in front of mouthpiece, 
false teeth falling in front of mouthpiece, etc.); or
    (D) Has an excessive variability between the three acceptable 
curves. The variation between the two largest MVV's of the three 
satisfactory tracings shall not exceed 10 percent.
    (iv) A calibration check shall be performed on the instrument 
each day before use, using a volume source of at least three liters, 
accurate to within <plus-minus>1 percent of full scale. The room air 
in the syringe is introduced into the spirometer once with a flow 
rate of approximately 0.5 liters per second (six seconds emptying 
time with a 3-liter syringe) and once with a higher flow rate of 
approximately 3.0 liters per second (one second emptying time with a 
3-liter syringe). The volume measured by the spirometer shall be 
between 2.90 and 3.10 liters for both trials. Accuracy of the time 
measurement used in determining the FEV1 shall be checked using the 
manufacturer's stated procedure and shall be within <plus-minus>3 
percent of actual. The procedure described herein shall be performed 
as well as any other procedures suggested by the manufacturer of the 
spirometer being used.
    (v)(A) The first step in evaluating a spirogram for the FEV1 
shall be to determine whether or not the patient has performed the 
test properly or as described in (2)(ii) above. From the three 
satisfactory tracings, the forced expiratory volume in one second 
(FEV1) shall be measured and recorded. The largest observed FEV1 
shall be used in the analysis, corrected to BTPS.
    (B) Only MVV maneuvers which demonstrate consistent effort for 
at least 12 seconds shall be considered acceptable. The largest 
accumulated volume for a 12 second period corrected to BTPS and 
multiplied by five is to be reported as the MVV.
* * * * *

Appendix C to Part 718--Blood-Gas Tables

    The following tables set forth the values to be applied in 
determining whether total disability may be established in 
accordance with Secs. 718.204(b)(2)(ii) and 718.305(a) and (c). The 
values contained in the tables are indicative of impairment only. 
They do not establish a degree of disability except as provided in 
Secs. 718.204(b)(2)(ii) and 718.305 (a) and (c) of this subchapter, 
nor do they establish standards for determining normal alveolar gas 
exchange values for any particular individual. Tests shall not be 
performed during or soon after an acute respiratory or cardiac 
illness.
    A miner who meets the following medical specifications shall be 
found to be totally disabled, in the absence of rebutting evidence, 
if the values specified in one of the following tables are met:
    (1) For arterial blood-gas studies performed at test sites up to 
2,999 feet above sea level:

------------------------------------------------------------------------
                                                               Arterial 
                                                              pO2 equal 
                   Arterial pCO2 (mm Hg)                      to or less
                                                               than (mm 
                                                                 Hg)    
------------------------------------------------------------------------
25 or below................................................          75 
26.........................................................          74 
27.........................................................          73 
28.........................................................          72 
29.........................................................          71 
30.........................................................          70 
31.........................................................          69 
32.........................................................          68 
33.........................................................          67 
34.........................................................          66 
35.........................................................          65 
36.........................................................          64 
37.........................................................          63 
38.........................................................          62 
39.........................................................          61 
40-49......................................................          60 
Above 50...................................................          (1)
------------------------------------------------------------------------

    (1) Any value.
    (2) For arterial blood-gas studies performed at test sites 3,000 
to 5,999 feet above sea level:

------------------------------------------------------------------------
                                                               Arterial 
                                                              pO2 equal 
                   Arterial pCO2 (mm Hg)                      to or less
                                                               than (mm 
                                                                 Hg)    
------------------------------------------------------------------------
25 or below................................................          70 
26.........................................................          69 
27.........................................................          68 
28.........................................................          67 
29.........................................................          66 
30.........................................................          65 
31.........................................................          64 
32.........................................................          63 
33.........................................................          62 
34.........................................................          61 
35.........................................................          60 
36.........................................................          59 
37.........................................................          58 
38.........................................................          57 
39.........................................................          56 
40-49......................................................          55 
Above 50...................................................          (2)
------------------------------------------------------------------------

    (2) Any value.
    (3) For arterial blood-gas studies performed at test sites 6,000 
feet or more above sea level:

------------------------------------------------------------------------
                                                               Arterial 
                                                              pO2 equal 
                   Arterial pCO2 (mm Hg)                      to or less
                                                               than (mm 
                                                                 Hg)    
------------------------------------------------------------------------
25 or below................................................          65 
26.........................................................          64 
27.........................................................          63 
28.........................................................          62 
29.........................................................          61 
30.........................................................          60 
31.........................................................          59 
32.........................................................          58 
33.........................................................          57 
34.........................................................          56 
35.........................................................          55 
36.........................................................          54 
37.........................................................          53 
38.........................................................          52 
39.........................................................          51 
40-49......................................................          50 
Above 50...................................................          (3)
------------------------------------------------------------------------

    (3) Any value.
    3. Part 722 is proposed to be revised as follows.

PART 722--CRITERIA FOR DETERMINING WHETHER STATE WORKERS' 
COMPENSATION LAWS PROVIDE ADEQUATE COVERAGE FOR PNEUMOCONIOSIS AND 
LISTING OF APPROVED STATE LAWS

Sec.
722.1  Purpose.
722.2  Definitions.
722.3  General criteria; inclusion in and removal from the 
Secretary's list.
722.4  The Secretary's list.

    Authority: 5 U.S.C. 301, Reorganization Plan No. 6 of 1950, 15 
FR 3174, 30 U.S.C. 901 et seq., 921, 932, 936; 33 U.S.C. 901 et 
seq., Secretary's Order 7-87, 52 FR 48466, Employment Standards 
Order No. 90-02.


Sec. 722.1  Purpose.

    Section 421 of the Black Lung Benefits Act provides that a claim 
for benefits based on the total disability or death of a coal miner due 
to pneumoconiosis must be filed under a State workers' compensation law 
where such law provides adequate coverage for pneumoconiosis. A State 
workers' compensation law may be deemed to provide adequate coverage 
only when it is included on a list of such laws maintained by the 
Secretary. The purpose of this part is to set forth the

[[Page 3382]]

procedures and criteria for inclusion on that list, and to provide that 
list.


 Sec. 722.2  Definitions.

    (a) The definitions and use of terms contained in subpart A of part 
725 of this title shall be applicable to this part.
    (b) For purposes of this part, the following definitions apply:
    (1) State agency means, with respect to any State, the agency, 
department or officer designated by the workers' compensation law of 
the State to administer such law. In any case in which more than one 
agency participates in the administration of a State workers' 
compensation law, the Governor of the State may designate which of the 
agencies shall be the State agency for purposes of this part.
    (2) The Secretary's list means the list published by the Secretary 
of Labor in the Federal Register (see Sec. 722.4) containing the names 
of those States which have in effect a workers' compensation law which 
provides adequate coverage for death or total disability due to 
pneumoconiosis.


Sec. 722.3  General criteria; inclusion in and removal from the 
Secretary's list.

    (a) The Governor of any State or any duly authorized State agency 
may, at any time, request that the Secretary include such State's 
workers' compensation law on his list of those State workers' 
compensation laws providing adequate coverage for total disability or 
death due to pneumoconiosis. Each such request shall include a copy of 
the State workers' compensation law and any other pertinent State laws, 
a copy of any regulations, either proposed or promulgated, implementing 
such laws; and a copy of any administrative or court decision 
interpreting such laws or regulations, or, if such decisions are 
published in a readily available report, a citation to such decision.
    (b) Upon receipt of a request that a State be included on the 
Secretary's list, the Secretary shall include the State on the list if 
he finds that the State's workers' compensation law guarantees the 
payment of monthly and medical benefits to all persons who would be 
entitled to such benefits under the Black Lung Benefits Act at the time 
of the request, at a rate no less than that provided by the Black Lung 
Benefits Act. The criteria used by the Secretary in making such 
determination shall include, but shall not be limited to, the criteria 
set forth in section 421(b)(2) of the Act.
    (c) The Secretary may require each State included on the list to 
submit reports detailing the extent to which the State's workers' 
compensation laws, as reflected by statute, regulation, or 
administrative or court decision, continues to meet the requirements of 
paragraph (b) of this section. If the Secretary concludes that the 
State's workers' compensation law does not provide adequate coverage at 
any time, either because of changes to the State workers' compensation 
law or the Black Lung Benefits Act, he shall remove the State from the 
Secretary's list after providing the State with notice of such removal 
and an opportunity to be heard.


Sec. 722.4  The Secretary's list.

    (a) The Secretary has determined that publication of the 
Secretary's list in the Code of Federal Regulations is appropriate. 
Accordingly, in addition to its publication in the Federal Register as 
required by section 421 of the Black Lung Benefits Act, the list shall 
also appear in paragraph (b) of this section.
    (b) Upon review of all requests filed with the Secretary under 
section 421 of the Black Lung Benefits Act and this part, and 
examination of the workers' compensation laws of the States making such 
requests, the Secretary has determined that the workers' compensation 
law of each of the following listed States, for the period from the 
date shown in the list until such date as the Secretary may make a 
contrary determination, provides adequate coverage for pneumoconiosis.

State            Period commencing
None............................................................

    4. Part 725 is proposed to be revised as follows:

PART 725--CLAIMS FOR BENEFITS UNDER PART C OF TITLE IV OF THE 
FEDERAL MINE SAFETY AND HEALTH ACT, AS AMENDED

Subpart A--General

Sec.
725.1  Statutory provisions.
725.2  Purpose and applicability of this part.
725.3   Contents of this part.
725.4  Applicability of other parts in this title.
725.101  Definitions and use of terms.
725.102  Disclosure of program information.
725.103  Burden of proof.

Subpart B--Persons Entitled to Benefits, Conditions, and Duration of 
Entitlement

725.201  Who is entitled to benefits; contents of this subpart.

Conditions and Duration of Entitlement: Miner

725.202  Miner defined; conditions of entitlement, miner.
725.203  Duration and cessation of entitlement, miner.

Conditions and Duration of Entitlement: Miner's Dependents (Augmented 
Benefits)

725.204  Determination of relationship; spouse.
725.205  Determination of dependency; spouse.
725.206  Determination of relationship; divorced spouse.
725.207  Determination of dependency; divorced spouse.
725.208  Determination of relationship; child.
725.209  Determination of dependency; child.
725.210  Duration of augmented benefits.
725.211  Time of determination of relationship and dependency of 
spouse or child for purposes of augmentation of benefits.

Conditions and Duration of Entitlement: Miner's Survivors

725.212  Conditions of entitlement; surviving spouse or surviving 
divorced spouse.
725.213  Duration of entitlement; surviving spouse or surviving 
divorced spouse.
725.214  Determination of relationship; surviving spouse.
725.215  Determination of dependency; surviving spouse.
725.216  Determination of relationship; surviving divorced spouse.
725.217  Determination of dependency; surviving divorced spouse.
725.218  Conditions of entitlement; child.
725.219  Duration of entitlement; child.
725.220  Determination of relationship; child.
725.221  Determination of dependency; child.
725.222  Conditions of entitlement; parent, brother or sister.
725.223  Duration of entitlement; parent, brother or sister.
725.224  Determination of relationship; parent, brother or sister.
725.225  Determination of dependency; parent, brother or sister.
725.226  ``Good cause'' for delayed filing of proof of support.
725.227  Time of determination of relationship and dependency of 
survivors.
725.228  Effect of conviction of felonious and intentional homicide 
on entitlement to benefits.

Terms Used in This Subpart

725.229  Intestate personal property.
725.230  Legal impediment.
725.231  Domicile.
725.232  Member of the same household--``living with,'' ``living in 
the same household,'' and ``living in the miner's household,'' 
defined.
725.233  Support and contributions.

Subpart C--Filing of Claims

725.301  Who may file a claim
725.302  Evidence of authority to file a claim on behalf of another.
725.303  Date and place of filing of claims.
725.304  Forms and initial processing.
725.305  When a written statement is considered a claim.

[[Page 3383]]

725.306  Withdrawal of a claim.
725.307  Cancellation of a request for withdrawal.
725.308  Time limits for filing claims.
725.309  Additional claims; effect of a prior denial of benefits.
725.310  Modification of awards and denials.
725.311  Communications with respect to claims; time computations.

Subpart D--Adjudication Officers; Parties and Representatives

725.350  Who are the adjudication officers.
725.351  Powers of adjudication officers.
725.352  Disqualification of adjudication officer.
725.360  Parties to proceedings
725.361  Party amicus curiae.
725.362  Representation of parties.
725.363  Qualification of representative.
725.364  Authority of representative.
725.365  Approval of representative's fees; lien against benefits.
725.366  Fees for representatives.
725.367  Payment of a claimant's attorney's fee by responsible 
operator or fund.

Subpart E--Adjudication of Claims by the District Director

725.401  Claims development--general.
725.402  Approved State workers' compensation law.
725.403  Requirement to file under State workers' compensation law--
section 415 claims.
725.404  Development of evidence--general.
725.405  Development of medical evidence; scheduling of medical 
examinations and tests.
725.406  Medical examinations and tests.
725.407  Identification and notification of responsible operator.
725.408  Operator's response to notification.
725.409  Denial of a claim by reason of abandonment.
725.410  Initial findings by the district director.
725.411  Initial finding--eligibility.
725.412  Initial finding--liability.
725.413  Initial adjudication by the district director.
725.414  Development of evidence.
725.415  Action by the district director after development of 
operator's evidence.
725.416  Conferences.
725.417  Action at the conclusion of conference.
725.418  Proposed decision and order.
725.419  Response to proposed decision and order.
725.420  Initial determinations.
725.421  Referral of a claim to the Office of Administrative Law 
Judges.
725.422  Legal Assistance.
725.423  Extensions of time.

Subpart F--Hearings

725.450  Right to a hearing.
725.451  Request for hearing.
725.452  Type of hearing; parties.
725.453  Notice of hearing.
725.454  Time and place of hearing; transfer of cases.
725.455  Hearing procedures; generally.
725.456  Introduction of documentary evidence.
725.457  Witnesses.
725.458  Depositions; interrogatories.
725.459  Witness fees.
725.460  Consolidated hearings.
725.461  Waiver of right to appear and present evidence.
725.462  Withdrawal of controversion of issues set for formal 
hearing; effect.
725.463  Issues to be resolved at hearing; new issues.
725.464  Record of hearing.
725.465  Dismissals for cause.
725.466  Order of dismissal.
725.475  Termination of hearings.
725.476  Issuance of decision and order.
725.477  Form and contents of decision and order.
725.478  Filing and service of decision and order.
725.479  Finality of decisions and orders.
725.480  Modification of decisions and orders.
725.481  Right to appeal to the Benefits Review Board.
725.482  Judicial review.
725.483  Costs in proceedings brought without reasonable grounds.

Subpart G--Responsible Coal Mine Operators

725.490  Statutory provisions and scope.
725.491  Operator defined.
725.492  Successor operator defined.
725.493  Employment relationship defined.
725.494  Potentially liable operators.
725.494  Criteria for determining a responsible operator.
725.496  Special claims transferred to the Trust Fund.
725.497  Procedures in special claims transferred to the Trust Fund.

Subpart H--Payment of Benefits

General Provisions

725.501  Payment provisions generally.
725.502  When benefit payments are due; manner of payment.
725.503  Date from which benefits are payable.
725.504  Payments to a claimant employed as a miner.
725.505  Payees.
725.506  Payment on behalf of another; ``legal guardian'' defined.
725.507  Guardian for minor or incompetent.
725.510  Representative payee.
725.511  Use and benefit defined.
725.512  Support of legally dependent spouse, child, or parent.
725.513  Accountability; transfer.
725.514  Certification to dependent of augmentation portion of 
benefit.
725.515  Assignment and exemption from claims of creditors.
725.520  Computation of benefits.
725.521  Commutation of payments; lump sum awards.
725.522  Payments prior to final adjudication.
725.530  Operator payments; generally.
725.531  Receipt for payment.

Increases and Reductions of Benefits

725.532  Suspension, reduction, or termination of payments.
725.533  Modification of benefit amounts; general.
725.534  Reduction of State benefits.
725.535  Reductions; receipt of State or Federal benefit.
725.536  Reductions; excess earnings.
725.537  Reductions; retroactive effect of an additional claim for 
benefits.
725.538  Reductions; effect of augmentation of benefits based on 
subsequent qualification of individual.
725.539  More than one reduction event.

Overpayments; Underpayments

725.540  Overpayments.
725.541  Notice of waiver of adjustment or recovery of overpayment.
725.542  When waiver of adjustment or recovery may be applied.
725.543  Standards for waiver of adjustment or recovery.
725.544  Collection and compromise of claims for overpayment.
725.545  Underpayments.
725.546  Relation to provisions for reductions or increases.
725.547  Applicability of overpayment and underpayment provisions to 
operator or carrier.

Subpart I--Enforcement of Liability; Reports

725.601  Enforcement generally.
725.602  Reimbursement of the fund.
725.603  Payments by the fund on behalf of an operator; liens.
725.604  Enforcement of final awards.
725.605  Defaults.
725.606  Security for the payment of benefits.
725.607  Payments in addition to compensation.
725.608  Interest.
725.609  Enforcement against other persons.
725.620  Failure to secure benefits; other penalties.
725.621  Reports.

Subpart J--Medical Benefits and Vocational Rehabilitation

725.701  Availability of medical benefits.
725.702  Claims for medical benefits only under section 11 of the 
Reform Act.
725.703  Physician defined.
725.704  Notification of right to medical benefits; authorization of 
treatment.
725.705  Arrangements for medical care.
725.706  Authorization to provide medical services.
725.707  Reports of physicians and supervision of medical care.
725.708  Disputes concerning medical benefits.
725.710  Objective of vocational rehabilitation.
725.711  Requests for referral to vocational rehabilitation 
assistance.

    Authority: 5 U.S.C. 301, Reorganization Plan No. 6 of 1950, 15 
FR 3174, 30 U.S.C. 901 et seq., 921, 932, 936; 33 U.S.C. 901 et 
seq., 42 U.S.C. 405, Secretary's Order 7-87, 52 FR 48466, Employment 
Standards Order No. 90-02.

[[Page 3384]]

Subpart A--General


Sec. 725.1   Statutory provisions.

    (a) General. Title IV of the Federal Mine Safety and Health Act of 
1977, as amended by the Black Lung Benefits Reform Act of 1977, the 
Black Lung Benefits Revenue Act of 1977, the Black Lung Benefits 
Revenue Act of 1981 and the Black Lung Benefits Amendments of 1981, 
provides for the payment of benefits to a coal miner who is totally 
disabled due to pneumoconiosis (black lung disease) and to certain 
survivors of a miner who dies due to pneumoconiosis. For claims filed 
prior to January 1, 1982, certain survivors could receive benefits if 
the miner was totally (or for claims filed prior to June 30, 1982, in 
accordance with section 411(c)(5) of the Act, partially) disabled due 
to pneumoconiosis, or if the miner died due to pneumoconiosis.
    (b) Part B. Part B of title IV of the Act provided that all claims 
filed between December 30, 1969, and June 30, 1973, are to be filed 
with, processed, and paid by the Secretary of Health, Education, and 
Welfare through the Social Security Administration; claims filed by the 
survivor of a miner before January 1, 1974, or within 6 months of the 
miner's death if death occurred before January 1, 1974, and claims 
filed by the survivor of a miner who was receiving benefits under part 
B of title IV of the Act at the time of death, if filed within 6 months 
of the miner's death, are also adjudicated and paid by the Social 
Security Administration.
    (c) Section 415. Claims filed by a miner between July 1 and 
December 31, 1973, are adjudicated and paid under section 415. Section 
415 provides that a claim filed between the appropriate dates shall be 
filed with and adjudicated by the Secretary of Labor under certain 
incorporated provisions of the Longshoremen's and Harbor Workers' 
Compensation Act (33 U.S.C. 901 et seq.). A claim approved under 
section 415 is paid under part B of title IV of the Act for periods of 
eligibility occurring between July 1 and December 31, 1973, by the 
Secretary of Labor and for periods of eligibility thereafter, is paid 
by a coal mine operator which is determined liable for the claim or the 
Black Lung Disability Trust Fund if no operator is identified or if the 
miner's last coal mine employment terminated prior to January 1, 1970. 
An operator which may be found liable for a section 415 claim is 
notified of the claim and allowed to participate fully in the 
adjudication of such claim. A claim filed under section 415 is for all 
purposes considered as if it were a part C claim (see paragraph (d) of 
this section) and the provisions of part C of title IV of the Act are 
fully applicable to a section 415 claim except as is otherwise provided 
in section 415.
    (d) Part C. Claims filed by a miner or survivor on or after January 
1, 1974, are filed, adjudicated, and paid under the provisions of part 
C of title IV of the Act. Part C requires that a claim filed on or 
after January 1, 1974, shall be filed under an applicable approved 
State workers' compensation law, or if no such law has been approved by 
the Secretary of Labor, the claim may be filed with the Secretary of 
Labor under section 422 of the Act. Claims filed with the Secretary of 
Labor under part C are processed and adjudicated by the Secretary and 
paid by a coal mine operator. If the miner's last coal mine employment 
terminated before January 1, 1970, or if no responsible operator can be 
identified, benefits are paid by the Black Lung Disability Trust Fund. 
Claims adjudicated under part C are subject to certain incorporated 
provisions of the Longshoremen's and Harbor Workers' Compensation Act.
    (e) Section 435. Section 435 of the Act affords each person who 
filed a claim for benefits under part B, section 415, or part C, and 
whose claim had been denied or was still pending as of March 1, 1978, 
the effective date of the Black Lung Benefits Reform Act of 1977, the 
right to have his or her claim reviewed on the basis of the 1977 
amendments to the Act, and under certain circumstances to submit new 
evidence in support of the claim.
    (f) Changes made by the Black Lung Benefits Reform Act of 1977. In 
addition to those changes which are reflected in paragraphs (a) through 
(e) of this section, the Black Lung Benefits Reform Act of 1977 
contains a number of significant amendments to the Act's standards for 
determining eligibility for benefits. Among these are:
    (1) A provision which clarifies the definition of 
``pneumoconiosis'' to include any ``chronic dust disease of the lung 
and its sequelae, including respiratory and pulmonary impairments, 
arising out of coal mine employment'';
    (2) A provision which defines ``miner'' to include any person who 
works or has worked in or around a coal mine or coal preparation 
facility, and in coal mine construction or coal transportation under 
certain circumstances;
    (3) A provision which limits the denial of a claim solely on the 
basis of employment in a coal mine;
    (4) A provision which authorizes the Secretary of Labor to 
establish standards and develop criteria for determining total 
disability or death due to pneumoconiosis with respect to a part C 
claim;
    (5) A new presumption which requires the payment of benefits to the 
survivors of a miner who was employed for 25 or more years in the mines 
under certain conditions;
    (6) Provisions relating to the treatment to be accorded a 
survivor's affidavit, certain X-ray interpretations, and certain 
autopsy reports in the development of a claim; and
    (7) Other clarifying, procedural, and technical amendments.
    (g) Changes made by the Black Lung Benefits Revenue Act of 1977. 
The Black Lung Benefits Revenue Act of 1977 established the Black Lung 
Disability Trust Fund which is financed by a specified tax imposed upon 
each ton of coal (except lignite) produced and sold or used in the 
United States after March 31, 1978. The Secretary of the Treasury is 
the managing trustee of the fund and benefits are paid from the fund 
upon the direction of the Secretary of Labor. The fund was made liable 
for the payment of all claims approved under section 415, part C and 
section 435 of the Act for all periods of eligibility occurring on or 
after January 1, 1974, with respect to claims where the miner's last 
coal mine employment terminated before January 1, 1970, or where 
individual liability can not be assessed against a coal mine operator 
due to bankruptcy, insolvency, or the like. The fund was also 
authorized to pay certain claims which a responsible operator has 
refused to pay within a reasonable time, and to seek reimbursement from 
such operator. The purpose of the fund and the Black Lung Benefits 
Revenue Act of 1977 was to insure that coal mine operators, or the coal 
industry, will fully bear the cost of black lung disease for the 
present time and in the future. The Black Lung Benefits Revenue Act of 
1977 also contained other provisions relating to the fund and 
authorized a coal mine operator to establish its own trust fund for the 
payment of certain claims.
    (h) Changes made by the Black Lung Benefits Amendments of 1981. In 
addition to the change reflected in paragraph (a) of this section, the 
Black Lung Benefits Amendments of 1981 made a number of significant 
changes in the Act's standards for determining eligibility for benefits 
and concerning the payment of such benefits. The following changes are 
all applicable to claims filed on or after January 1, 1982:
    (1) The Secretary of Labor may re-read any X-ray submitted in 
support of a claim and may rely upon a second opinion concerning such 
an X-ray as a

[[Page 3385]]

means of auditing the validity of the claim;
    (2) The rebuttable presumption that the death of a miner with ten 
or more years employment in the coal mines, who died of a respirable 
disease, was due to pneumoconiosis is no longer applicable;
    (3) The rebuttable presumption that the total disability of a miner 
with fifteen or more years employment in the coal mines, who has 
demonstrated a totally disabling respiratory or pulmonary impairment, 
is due to pneumoconiosis is no longer applicable;
    (4) In the case of deceased miners, where no medical or other 
relevant evidence is available, only affidavits from persons not 
eligible to receive benefits as a result of the adjudication of the 
claim will be considered sufficient to establish entitlement to 
benefits;
    (5) Unless the miner was found entitled to benefits as a result of 
a claim filed prior to January 1, 1982, benefits are payable on 
survivors' claims filed on and after January 1, 1982, only when the 
miner's death was due to pneumoconiosis;
    (6) Benefits payable under this part are subject to an offset on 
account of excess earnings by the miner; and
    (7) Other technical amendments.
    (i) Changes made by the Black Lung Benefits Revenue Act of 1981. 
The Black Lung Benefits Revenue Act of 1981 temporarily doubles the 
amount of the tax upon coal until the fund shall have repaid all 
advances received from the United States Treasury and the interest on 
all such advances. The fund is also made liable for the payment of 
certain claims previously denied under the 1972 version of the Act and 
subsequently approved under section 435 and for the reimbursement of 
operators and insurers for benefits previously paid by them on such 
claims. With respect to claims filed on or after January 1, 1982, the 
fund's authorization for the payment of interim benefits is limited to 
the payment of prospective benefits only. These changes also define the 
rates of interest to be paid to and by the fund.
    (j) Longshoremen's Act provisions. The adjudication of claims filed 
under sections 415, 422 and 435 of the Act is governed by various 
procedural and other provisions contained in the Longshoremen's and 
Harbor Workers' Compensation Act (LHWCA), as amended from time to time, 
which are incorporated within the Act by sections 415 and 422. The 
incorporated LHWCA provisions are applicable under the Act except as is 
otherwise provided by the Act or as provided by regulations of the 
Secretary. Although occupational disease benefits are also payable 
under the LHWCA, the primary focus of the procedures set forth in that 
Act is upon a time definite of traumatic injury or death. Because of 
this and other significant differences between a black lung and 
longshore claim, it is determined, in accordance with the authority set 
forth in section 422 of the Act, that certain of the incorporated 
procedures prescribed by the LHWCA must be altered to fit the 
circumstances ordinarily confronted in the adjudication of a black lung 
claim. The changes made are based upon the Department's experience in 
processing black lung claims since July 1, 1973, and all such changes 
are specified in this part or part 727 of this subchapter (see 
Sec. 725.4(d)). No other departure from the incorporated provisions of 
the LHWCA is intended.
    (k) Social Security Act provisions. Section 402 of the Act 
incorporates certain definitional provisions from the Social Security 
Act, 42 U.S.C. 301 et seq. Section 430 provides that the 1972, 1977 and 
1981 amendments to part B of the Act shall also apply to part C ``to 
the extent appropriate.'' Sections 412 and 413 incorporate various 
provisions of the Social Security Act into part B of the Act. To the 
extent appropriate, these provisions also apply to part C. In certain 
cases, the Department has varied the terms of the Social Security Act 
provisions to accommodate the unique needs of the black lung benefits 
program. Parts of the Longshore and Harbor Workers' Compensation Act 
are also incorporated into part C. Where the incorporated provisions of 
the two acts are inconsistent, the Department has exercised its broad 
regulatory powers to choose the extent to which incorporation is 
appropriate.


Sec. 725.2  Purpose and applicability of this part.

    (a) It is the purpose of this part to set forth the procedures to 
be followed and standards to be applied in the filing, processing, 
adjudication, and payment of claims filed under part C of title IV of 
the Act.
    (b) This part is applicable to all claims filed under part C of 
title IV of the Act on or after August 18, 1978 and shall also be 
applicable to claims that were pending on August 18, 1978.
    (c) The provisions of this part reflect revisions that became 
effective on [the effective date of the final rule]. This part is 
applicable to all claims filed, and all benefits payments made, after 
[the effective date of the final rule]. With the exception of the 
following sections, this part shall also be applicable to the 
adjudication of claims that were pending on [the effective date of the 
final rule]: Secs. 725.309, 725.310, 725.360, 725.406, 725.407, 
725.408, 725.410, 725.411, 725.412, 725.413, 725.414, 725.415, 725.417, 
725.418, 725.423, 725.454, 725.456, 725.457, 725.459, 725.491, 725.492, 
725.493, 725.494, 725.495, 725.547. The version of those sections set 
forth in 20 CFR, parts 500 to end, edition revised as of April 1, 1996, 
are applicable to the adjudications of claims that were pending on [the 
effective date of the final rule]. For purposes of construing the 
provisions of this section, a claim shall be considered pending on [the 
effective date of the final rule] if it was not finally denied more 
than one year prior to that date.


Sec. 725.3  Contents of this part.

    (a) This subpart describes the statutory provisions which relate to 
claims considered under this part, the purpose and scope of this part, 
definitions and usages of terms applicable to this part, and matters 
relating to the availability of information collected by the Department 
of Labor in connection with the processing of claims.
    (b) Subpart B contains criteria for determining who may be found 
entitled to benefits under this part and other provisions relating to 
the conditions and duration of eligibility of a particular individual.
    (c) Subpart C describes the procedures to be followed and action to 
be taken in connection with the filing of a claim under this part.
    (d) Subpart D sets forth the duties and powers of the persons 
designated by the Secretary of Labor to adjudicate claims and 
provisions relating to the rights of parties and representatives of 
parties.
    (e) Subpart E contains the procedures for developing evidence and 
adjudicating entitlement and liability issues by the district director.
    (f) Subpart F describes the procedures to be followed if a hearing 
before the Office of Administrative Law Judges is required.
    (g) Subpart G contains provisions governing the identification of a 
coal mine operator which may be liable for the payment of a claim.
    (h) Subpart H contains provisions governing the payment of benefits 
with respect to an approved claim.
    (i) Subpart I describes the statutory mechanisms provided for the 
enforcement of a coal mine operator's liability, sets forth the 
penalties which may be applied in the case of a defaulting coal mine 
operator, and describes the obligation of coal

[[Page 3386]]

operators and their insurance carriers to file certain reports.
    (j) Subpart J describes the right of certain beneficiaries to 
receive medical treatment benefits and vocational rehabilitation under 
the Act.


Sec. 725.4  Applicability of other parts in this title.

    (a) Part 718. Part 718 of this subchapter, which contains the 
criteria and standards to be applied in determining whether a miner is 
or was totally disabled due to pneumoconiosis, or whether a miner died 
due to pneumoconiosis, shall be applicable to the determination of 
claims under this part. Claims filed after March 31, 1980, are subject 
to part 718 as promulgated by the Secretary in accordance with section 
402(f)(1) of the Act on February 29, 1980 (see Sec. 725.2(c)). The 
criteria contained in subpart C of part 727 of this subchapter are 
applicable in determining claims filed prior to April 1, 1980, under 
this part, and such criteria shall be applicable at all times with 
respect to claims filed under this part and under section 11 of the 
Black Lung Benefits Reform Act of 1977.
    (b) Parts 715, 717, and 720. Pertinent and significant provisions 
of Parts 715, 717, and 720 of this subchapter (formerly contained in 20 
CFR, parts 500 to end, edition revised as of April 1, 1978), which 
established the procedures for the filing, processing, and payment of 
claims filed under section 415 of the Act, are included within this 
part as appropriate.
    (c) Part 726. Part 726 of this subchapter, which sets forth the 
obligations imposed upon a coal operator to insure or self-insure its 
liability for the payment of benefits to certain eligible claimants, is 
applicable to this part as appropriate.
    (d) Part 727. Part 727 of this subchapter, which governs the 
review, adjudication and payment of pending and denied claims under 
section 435 of the Act, is applicable with respect to such claims. The 
criteria contained in subpart C of part 727 for determining a 
claimant's eligibility for benefits are applicable under this part with 
respect to all claims filed before April 1, 1980, and to all claims 
filed under this part and under section 11 of the Black Lung Benefits 
Reform Act of 1977. Because the part 727 regulations affect an 
increasingly smaller number of claims, however, the Department has 
discontinued publication of the criteria in the Code of Federal 
Regulations. The part 727 criteria may be found at 43 FR 36818, Aug. 
18, 1978 or 20 CFR, parts 500 to end, edition revised as of April 1, 
1996.
    (e) Part 410. Part 410 of this title, which sets forth provisions 
relating to a claim for black lung benefits under part B of title IV of 
the Act, is inapplicable to this part except as is provided in this 
part, or in part 718 of this subchapter.


Sec. 725.101  Definitions and use of terms.

    (a) Definitions. For purposes of this subchapter, except where the 
content clearly indicates otherwise, the following definitions apply:
    (1) The Act means the Federal Coal Mine Health and Safety Act, 
Public Law 91-173, 83 Stat. 742, 30 U.S.C. 801-960, as amended by the 
Black Lung Benefits Act of 1972, the Mine Safety and Health Act of 
1977, the Black Lung Benefits Reform Act of 1977, the Black Lung 
Benefits Revenue Act of 1977, the Black Lung Benefits Revenue Act of 
1981, and the Black Lung Benefits Amendments of 1981.
    (2) The Longshoremen's Act or LHWCA means the Longshoremen's and 
Harbor Workers' Compensation Act of March 4, 1927, c. 509, 44 Stat. 
1424, 33 U.S.C. 901-950, as amended from time to time.
    (3) The Social Security Act means the Social Security Act, Act of 
August 14, 1935, c. 531, 49 Stat. 620, 42 U.S.C. 301-431, as amended 
from time to time.
    (4) Administrative law judge means a person qualified under 5 
U.S.C. 3105 to conduct hearings and adjudicate claims for benefits 
filed pursuant to section 415 and part C of the Act. Until March 1, 
1979, it shall also mean an individual appointed to conduct such 
hearings and adjudicate such claims under Public Law 94-504.
    (5) Beneficiary means a miner or any surviving spouse, divorced 
spouse, child, parent, brother or sister, who is entitled to benefits 
under either section 415 or part C of title IV of the Act.
    (6) Benefits means all money or other benefits paid or payable 
under section 415 or part C of title IV of the Act on account of 
disability or death due to pneumoconiosis. The term also includes any 
expenses related to the medical examination and testing authorized by 
the district director pursuant to Sec. 725.406.
    (7) Benefits Review Board or Board means the Benefits Review Board, 
U.S. Department of Labor, an appellate tribunal appointed by the 
Secretary of Labor pursuant to the provisions of section 21(b)(1) of 
the LHWCA. See parts 801 and 802 of this title.
    (8) Black Lung Disability Trust Fund or the fund means the Black 
Lung Disability Trust Fund established by the Black Lung Benefits 
Revenue Act of 1977, as amended by the Black Lung Benefits Revenue Act 
of 1981, for the payment of certain claims adjudicated under this part 
(see subpart G of this part).
    (9) Chief Administrative Law Judge means the Chief Administrative 
Law Judge of the Office of Administrative Law Judges, U.S. Department 
of Labor, 800 K Street, NW., suite 400, Washington, DC 20001-8002.
    (10) Claim means a written assertion of entitlement to benefits 
under section 415 or part C of title IV of the Act, submitted in a form 
and manner authorized by the provisions of this subchapter.
    (11) Claimant means an individual who files a claim for benefits 
under this part.
    (12) Coal mine means an area of land and all structures, 
facilities, machinery, tools, equipment, shafts, slopes, tunnels, 
excavations and other property, real or personal, placed upon, under or 
above the surface of such land by any person, used in, or to be used 
in, or resulting from, the work of extracting in such area bituminous 
coal, lignite or anthracite from its natural deposits in the earth by 
any means or method, and in the work of preparing the coal so 
extracted, and includes custom coal preparation facilities.
    (13) Coal preparation means the breaking, crushing, sizing, 
cleaning, washing, drying, mixing, storing and loading of bituminous 
coal, lignite or anthracite, and such other work of preparing coal as 
is usually done by the operator of a coal mine. For purposes of this 
definition, the term does not include coal preparation performed by 
coke oven workers.
    (14) Department means the United States Department of Labor.
    (15) Director means the Director, OWCP, or his or her designee.
    (16) District Director means a person appointed as provided in 
sections 39 and 40 of the LHWCA, or his or her designee, who is 
authorized to develop and adjudicate claims as provided in this 
subchapter (see Sec. 725.350). The term District Director is 
substituted for the term Deputy Commissioner wherever that term appears 
in this subchapter. This substitution is for administrative purposes 
only and in no way affects the power or authority of the position as 
established in the statute. Any action taken by a person under the 
authority of a district director will be considered the action of a 
deputy commissioner.
    (17) Division or DCMWC means the Division of Coal Mine Workers' 
Compensation in the OWCP, Employment Standards Administration, United 
States Department of Labor.

[[Page 3387]]

    (18) Insurer or carrier means any private company, corporation, 
mutual association, reciprocal or interinsurance exchange, or any other 
person or fund, including any State fund, authorized under the laws of 
a State to insure employers' liability under workers' compensation 
laws. The term also includes the Secretary of Labor in the exercise of 
his or her authority under section 433 of the Act.
    (19) Miner or coal miner means any individual who works or has 
worked in or around a coal mine or coal preparation facility in the 
extraction or preparation of coal. The term also includes an individual 
who works or has worked in coal mine construction or transportation in 
or around a coal mine, to the extent such individual was exposed to 
coal dust as a result of such employment (see Sec. 725.202). For 
purposes of this definition, the term does not include coke oven 
workers whose activities involve the preparation or use of coal for the 
coke manufacturing process.
    (20) The Nation's coal mines means all coal mines located in any 
State.
    (21) Office or OWCP means the Office of Workers' Compensation 
Programs, United States Department of Labor.
    (22) Office of Administrative Law Judges means the Office of 
Administrative Law Judges, U.S. Department of Labor.
    (23) Operator means any owner, lessee, or other person who 
operates, controls or supervises a coal mine, including a prior or 
successor operator as defined in section 422 of the Act and certain 
transportation and construction employers (see subpart G of this part).
    (24) Person means an individual, partnership, association, 
corporation, firm, subsidiary or parent of a corporation, or other 
organization or business entity.
    (25) Pneumoconiosis means a chronic dust disease of the lung and 
its sequelae, including respiratory and pulmonary impairments, arising 
out of coal mine employment (see part 718 of this subchapter).
    (26) Responsible operator means an operator which has been 
determined to be liable for the payment of benefits to a claimant for 
periods of eligibility after December 31, 1973, with respect to a claim 
filed under section 415 or part C of title IV of the Act or reviewed 
under section 435 of the Act.
    (27) Secretary means the Secretary of Labor, United States 
Department of Labor, or a person, authorized by him or her to perform 
his or her functions under title IV of the Act.
    (28) State includes any state of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, American 
Samoa, Guam, the Trust Territory of the Pacific Islands, and prior to 
January 3, 1959, and August 21, 1959, respectively, the territories of 
Alaska and Hawaii.
    (29) Total disability and partial disability, for purposes of this 
part, have the meaning given them as provided in part 718 of this 
subchapter.
    (30) Underground coal mine means a coal mine in which the earth and 
other materials which lie above and around the natural deposit of coal 
(i.e., overburden) are not removed in mining; including all land, 
structures, facilities, machinery, tools, equipment, shafts, slopes, 
tunnels, excavations and other property, real or personal, appurtenant 
thereto.
    (31) A workers' compensation law means a law providing for payment 
of benefits to employees, and their dependents and survivors, for 
disability on account of injury, including occupational disease, or 
death, suffered in connection with their employment. A payment funded 
wholly out of general revenues shall not be considered a payment under 
a workers' compensation law.
    (32) Year means a period of one calendar year (365 days), or 
partial periods totalling one year, during which the miner worked in or 
around a coal mine or mines. A ``working day'' means any day or part of 
a day for which a miner received pay for work as a miner, including any 
day for which the miner received pay while on an approved absence, such 
as vacation or sick leave.
    (i) If the evidence establishes that the miner worked in or around 
coal mines at least 125 working days during a calendar year or partial 
periods totalling one year, then the miner has worked one year in coal 
mine employment for all purposes under the Act. If a miner worked fewer 
than 125 working days in a year, he or she has worked a fractional year 
based on the ratio of the actual number of days worked to 125. Proof 
that the miner worked more than 125 working days in a calendar year or 
partial periods totalling a year, shall not establish more than one 
year.
    (ii) To the extent the evidence permits, the beginning and ending 
dates of all periods of coal mine employment shall be ascertained. The 
dates and length of employment may be established by any credible 
evidence including (but not limited to) company records, pension 
records, earnings statements, coworker affidavits, and sworn testimony. 
If the evidence establishes that the miner's employment lasted for a 
calendar year, it shall be presumed, in the absence of evidence to the 
contrary, that the miner spent at least 125 working days in such 
employment.
    (iii) If the evidence is insufficient to establish the beginning 
and ending dates of the miner's coal mine employment, or the miner's 
employment lasted less than a calendar year, then the adjudication 
officer may use the following formula: divide the miner's yearly income 
from work as a miner by the coal mine industry's average daily earnings 
for that year, as reported by the Bureau of Labor Statistics (BLS). A 
copy of the BLS table shall be made a part of the record if the 
adjudication officer uses this method to establish the length of the 
miner's work history.
    (iv) No periods of coal mine employment occurring outside the 
United States shall be considered in computing the miner's work 
history.
    (b) Statutory terms. The definitions contained in this section 
shall not be construed in derogation of terms of the Act.
    (c) Dependents and survivors. Dependents and survivors are those 
persons described in subpart B of this part.


Sec. 725.102  Disclosure of program information.

    (a) All reports, records, or other documents filed with the OWCP 
with respect to claims are the records of the OWCP. The Director or his 
or her designee shall be the official custodian of those records 
maintained by the OWCP at its national office. The District Director 
shall be the official custodian of those records maintained at a 
district office.
    (b) The official custodian of any record sought to be inspected 
shall permit or deny inspection in accordance with the Department of 
Labor's regulations pertaining thereto (see 29 CFR part 70). The 
original record in any such case shall not be removed from the Office 
of the custodian for such inspection. The custodian may, in his or her 
discretion, deny inspection of any record or part thereof which is of a 
character specified in 5 U.S.C. 552(b) if in his or her opinion such 
inspection may result in damage, harm, or harassment to the beneficiary 
or to any other person. For special provisions concerning release of 
information regarding injured employees undergoing vocational 
rehabilitation, see Sec. 702.508 of this title.
    (c) Any person may request copies of records he or she has been 
permitted to inspect. Such requests shall be addressed to the official 
custodian of the records sought to be copied. The official

[[Page 3388]]

custodian shall provide the requested copies under the terms and 
conditions specified in the Department of Labor's regulations relating 
thereto (see 29 CFR part 70).
    (d) Any party to a claim (Sec. 725.360) or his or her duly 
authorized representative shall be permitted upon request to inspect 
the file which has been compiled in connection with such claim. Any 
party to a claim or representative of such party shall upon request be 
provided with a copy of any or all material contained in such claim 
file. A request for information by a party or representative made under 
this paragraph shall be answered within a reasonable time after receipt 
by the Office. Internal documents prepared by the district director 
which do not constitute evidence of a fact which must be established in 
connection with a claim shall not be routinely provided or presented 
for inspection in accordance with a request made under this paragraph.


Sec. 725.103  Burden of proof.

    Except as otherwise provided in this part and part 718, the burden 
of proving a fact alleged in connection with any provision shall rest 
with the party making such allegation.

Subpart B--Persons Entitled to Benefits, Conditions, and Duration 
of Entitlement


Sec. 725.201  Who is entitled to benefits; contents of this subpart.

    (a) Section 415 and part C of the Act provide for the payment of 
periodic benefits in accordance with this part to:
    (1) A miner (see Sec. 725.202) who is determined to be totally 
disabled due to pneumoconiosis; or
    (2) The surviving spouse or surviving divorced spouse or, where 
neither exists, the child of a deceased miner, where the deceased 
miner:
    (i) Was receiving benefits under section 415 or part C of title IV 
of the Act as a result of a claim filed prior to January 1, 1982; or
    (ii) Is determined as a result of a claim filed prior to January 1, 
1982, to have been totally disabled due to pneumoconiosis at the time 
of death, or to have died due to pneumoconiosis. Survivors of miners 
whose claims are filed on or after January 1, 1982, must establish that 
the deceased miner's death was due to pneumoconiosis in order to 
establish their entitlement to benefits, except where entitlement is 
established under Sec. 718.306 of part 718 on a survivor's claim filed 
prior to June 30, 1982, or;
    (3) The child of a miner's surviving spouse who was receiving 
benefits under section 415 or part C of title IV of the Act at the time 
of such spouse's death; or
    (4) The surviving dependent parents, where there is no surviving 
spouse or child, or the surviving dependent brothers or sisters, where 
there is no surviving spouse, child, or parent, of a miner, where the 
deceased miner;
    (i) Was receiving benefits under section 415 or part C of title IV 
of the Act as a result of a claim filed prior to January 1, 1982; or
    (ii) Is determined as a result of a claim filed prior to January 1, 
1982, to have been totally disabled due to pneumoconiosis at the time 
of death, or to have died due to pneumoconiosis. Survivors of miners 
whose claims are filed on or after January 1, 1982, must establish that 
the deceased miner's death was due to pneumoconiosis in order to 
establish their entitlement to benefits, except where entitlement is 
established under Sec. 718.306 of part 718 on a survivor's claim filed 
prior to June 30, 1982.
    (b) Section 411(c)(5) of the Act provides for the payment of 
benefits to the eligible survivors of a miner employed for 25 or more 
years in the mines prior to June 30, 1971, if the miner's death 
occurred on or before March 1, 1978, and if the claim was filed prior 
to June 30, 1982, unless it is established that at the time of death, 
the miner was not totally or partially disabled due to pneumoconiosis. 
For the purposes of this part the term ``total disability'' shall mean 
partial disability with respect to a claim for which eligibility is 
established under section 411(c)(5) of the Act. See Sec. 718.306 of 
part 718 which implements this provision of the Act.
    (c) The provisions contained in this subpart describe the 
conditions of entitlement to benefits applicable to a miner, or a 
surviving spouse, child, parent, brother, or sister, and the events 
which establish or terminate entitlement to benefits.
    (d) In order for an entitled miner or surviving spouse to qualify 
for augmented benefits because of one or more dependents, such 
dependents must meet relationship and dependency requirements with 
respect to such beneficiary prescribed by or pursuant to the Act. Such 
requirements are also set forth in this subpart.

Conditions and Duration of Entitlement: Miner


Sec. 725.202  Miner defined; condition of entitlement, miner.

    (a) Miner defined. A ``miner'' for the purposes of this part is any 
person who works or has worked in or around a coal mine or coal 
preparation facility in the extraction, preparation, or transportation 
of coal, and any person who works or has worked in coal mine 
construction or maintenance in or around a coal mine or coal 
preparation facility. There shall be a rebuttable presumption that any 
person working in or around a coal mine or coal preparation facility is 
a miner. This presumption may be rebutted by proof that:
    (1) The person was not engaged in the extraction, preparation or 
transportation of coal while working at the mine site, or in 
maintenance or construction of the mine site; or
    (2) The individual was not regularly employed in or around a coal 
mine or coal preparation facility.
    (b) Coal mine construction and transportation workers; special 
provisions. A coal mine construction or transportation worker shall be 
considered a miner to the extent such individual is or was exposed to 
coal mine dust as a result of employment in or around a coal mine or 
coal preparation facility. A transportation worker shall be considered 
a miner to the extent that his or her work is integral to the 
extraction or preparation of coal. A construction worker shall be 
considered a miner to the extent that his or her work is integral to 
the building of a coal or underground mine (see Sec. 725.101(a) (12) 
and (30)).
    (1) There shall be a rebuttable presumption that such individual 
was exposed to coal mine dust during all periods of such employment 
occurring in or around a coal mine or coal preparation facility for 
purposes of:
    (i) Determining whether such individual is or was a miner;
    (ii) Establishing the applicability of any of the presumptions 
described in section 411(c) of the Act and part 718 of this subchapter; 
and
    (iii) Determining the identity of a coal mine operator liable for 
the payment of benefits in accordance with Sec. 725.495.
    (2) The presumption may be rebutted by evidence which demonstrates 
that:
    (i) The individual was not regularly exposed to coal mine dust 
during his or her work in or around a coal mine or coal preparation 
facility; or
    (ii) The individual did not work regularly in or around a coal mine 
or coal preparation facility.
    (c) A person who is or was a self-employed miner or independent 
contractor, and who otherwise meets the requirements of this paragraph, 
shall be considered a miner for the purposes of this part.

[[Page 3389]]

    (d) Conditions of entitlement; miner. An individual is eligible for 
benefits under this subchapter if the individual:
    (1) Is a miner as defined in this section; and
    (2) Has met the requirements for entitlement to benefits by 
establishing that he or she:
    (i) Has pneumoconiosis (see Sec. 718.202); and
    (ii) The pneumoconiosis arose out of coal mine employment (see 
Sec. 718.203); and
    (iii) Is totally disabled (see Sec. 718.204(c)); and
    (iv) The pneumoconiosis contributes to the total disability (see 
Sec. 718.204(c)); and
    (3) Has filed a claim for benefits in accordance with the 
provisions of this part.


Sec. 725.203  Duration and cessation of entitlement; miner.

     (a) An individual is entitled to benefits as a miner for each 
month beginning with the first month on or after January 1, 1974, in 
which the miner is totally disabled due to pneumoconiosis arising out 
of coal mine employment.
    (b) The last month for which such individual is entitled to 
benefits is the month before the month during which either of the 
following events first occurs:
    (1) The miner dies; or
    (2) The miner's total disability ceases (see Sec. 725.504).
    (c) An individual who has been finally adjudged to be totally 
disabled due to pneumoconiosis and is receiving benefits under the Act 
shall promptly notify the Office and the responsible coal mine 
operator, if any, if he or she engages in his or her usual coal mine 
work or comparable and gainful work.
    (d) Upon reasonable notice, an individual who has been finally 
adjudged entitled to benefits shall submit to any additional tests or 
examinations the Office deems appropriate if an issue arises pertaining 
to the validity of the original award.

Conditions and Duration of Entitlement: Miner's Dependents 
(Augmented Benefits)


Sec. 725.204  Determination of relationship; spouse.

    (a) For the purpose of augmenting benefits, an individual will be 
considered to be the spouse of a miner if:
    (1) The courts of the State in which the miner is domiciled would 
find that such individual and the miner validly married; or
    (2) The courts of the State in which the miner is domiciled would 
find, under the law they would apply in determining the devolution of 
the miner's intestate personal property, that the individual is the 
miner's spouse; or
    (3) Under State law, such individual would have the right of a 
spouse to share in the miner's intestate personal property; or
    (4) Such individual went through a marriage ceremony with the miner 
resulting in a purported marriage between them and which, but for a 
legal impediment, would have been a valid marriage, unless the 
individual entered into the purported marriage with knowledge that it 
was not a valid marriage, or if such individual and the miner were not 
living in the same household in the month in which a request is filed 
that the miner's benefits be augmented because such individual 
qualifies as the miner's spouse.
    (b) The qualification of an individual for augmentation purposes 
under this section shall end with the month before the month in which:
    (1) The individual dies, or
    (2) The individual who previously qualified as a spouse for 
purposes of Sec. 725.520(c), entered into a valid marriage without 
regard to this section, with a person other than the miner.


Sec. 725.205  Determination of dependency; spouse.

    For the purposes of augmenting benefits, an individual who is the 
miner's spouse (see Sec. 725.204) will be determined to be dependent 
upon the miner if:
    (a) The individual is a member of the same household as the miner 
(see Sec. 725.232); or
    (b) The individual is receiving regular contributions from the 
miner for support (see Sec. 725.233(c)); or
    (c) The miner has been ordered by a court to contribute to such 
individual's support (see Sec. 725.233(e)); or
    (d) The individual is the natural parent of the son or daughter of 
the miner; or
    (e) The individual was married to the miner (see Sec. 725.204) for 
a period of not less than 1 year.


Sec. 725.206  Determination of relationship; divorced spouse.

    For the purposes of augmenting benefits with respect to any claim 
considered or reviewed under this part or part 727 of this subchapter 
(see Sec. 725.4(d)), an individual will be considered to be the 
divorced spouse of a miner if the individual's marriage to the miner 
has been terminated by a final divorce on or after the 10th anniversary 
of the marriage unless, if such individual was married to and divorced 
from the miner more than once, such individual was married to the miner 
in each calendar year of the period beginning 10 years immediately 
before the date on which any divorce became final.


Sec. 725.207  Determination of dependency; divorced spouse.

    For the purpose of augmenting benefits, an individual who is the 
miner's divorced spouse (Sec. 725.206) will be determined to be 
dependent upon the miner if:
    (a) The individual is receiving at least one-half of his or her 
support from the miner (see Sec. 725.233(g)); or
    (b) The individual is receiving substantial contributions from the 
miner pursuant to a written agreement (see Sec. 725.233 (c) and (f)); 
or
    (c) A court order requires the miner to furnish substantial 
contributions to the individual's support (see Sec. 725.233 (c) and 
(e)).


Sec. 725.208  Determination of relationship; child.

     As used in this section, the term ``beneficiary'' means only a 
surviving spouse entitled to benefits at the time of death (see 
Sec. 725.212), or a miner. An individual will be considered to be the 
child of a beneficiary if:
    (a) The courts of the State in which the beneficiary is domiciled 
(see Sec. 725.231) would find, under the law they would apply, that the 
individual is the beneficiary's child; or
    (b) The individual is the legally adopted child of such 
beneficiary; or
    (c) The individual is the stepchild of such beneficiary by reason 
of a valid marriage of the individual's parent or adopting parent to 
such beneficiary; or
    (d) The individual does not bear the relationship of child to such 
beneficiary under paragraph (a), (b), or (c) of this section, but 
would, under State law, have the same right as a child to share in the 
beneficiary's intestate personal property; or
    (e) The individual is the natural son or daughter of a beneficiary 
but is not a child under paragraph (a), (b), or (c) of this section, 
and is not considered to be the child of the beneficiary under 
paragraph (d) of this section if the beneficiary and the mother or the 
father, as the case may be, of the individual went through a marriage 
ceremony resulting in a purported marriage between them which but for a 
legal impediment (see Sec. 725.230) would have been a valid marriage; 
or
    (f) The individual is the natural son or daughter of a beneficiary 
but is not a child under paragraph (a), (b), or (c) of this section, 
and is not considered to

[[Page 3390]]

be the child of the beneficiary under paragraph (d) or (e) of this 
section, such individual shall nevertheless be considered to be the 
child of the beneficiary if:
    (1) The beneficiary, prior to his or her entitlement to benefits, 
has acknowledged in writing that the individual is his or her son or 
daughter, or has been decreed by a court to be the parent of the 
individual, or has been ordered by a court to contribute to the support 
of the individual (see Sec. 725.233(e)) because the individual is his 
or her son or daughter; or
    (2) Such beneficiary is shown by satisfactory evidence to be the 
father or mother of the individual and was living with or contributing 
to the support of the individual at the time the beneficiary became 
entitled to benefits.


Sec. 725.209  Determination of dependency; child.

    (a) For purposes of augmenting the benefits of a miner or surviving 
spouse, the term ``beneficiary'' as used in this section means only a 
miner or surviving spouse entitled to benefits (see Sec. 725.202 and 
Sec. 725.212). An individual who is the beneficiary's child 
(Sec. 725.208) will be determined to be, or to have been dependent on 
the beneficiary, if the child:
    (1) Is unmarried; and
    (2)(i) Is under 18 years of age; or
    (ii) Is under a disability as defined in section 223(d) of the 
Social Security Act, 42 U.S.C. 423(d), which began before the age of 
22; or
    (iii) Is 18 years of age or older and is a student.
    (b)(1) The term ``student'' means a ``full-time student'' as 
defined in section 202(d)(7) of the Social Security Act, 42 U.S.C. 
402(d)(7) (see Secs. 404.367 through 404.369 of this title), or an 
individual under 23 years of age who has not completed 4 years of 
education beyond the high school level and who is regularly pursuing a 
full-time course of study or training at an institution which is:
    (i) A school, college, or university operated or directly supported 
by the United States, or by a State or local government or political 
subdivision thereof; or
    (ii) A school, college, or university which has been accredited by 
a State or by a State-recognized or nationally-recognized accrediting 
agency or body; or
    (iii) A school, college, or university not so accredited but whose 
credits are accepted, on transfer, by at least three institutions which 
are so accredited; or
    (iv) A technical, trade, vocational, business, or professional 
school accredited or licensed by the Federal or a State government or 
any political subdivision thereof, providing courses of not less than 3 
months' duration that prepare the student for a livelihood in a trade, 
industry, vocation, or profession.
    (2) A student will be considered to be ``pursuing a full-time 
course of study or training at an institution'' if the student is 
enrolled in a noncorrespondence course of at least 13 weeks duration 
and is carrying a subject load which is considered full-time for day 
students under the institution's standards and practices. A student 
beginning or ending a full-time course of study or training in part of 
any month will be considered to be pursuing such course for the entire 
month.
    (3) A child is considered not to have ceased to be a student:
    (i) During any interim between school years, if the interim does 
not exceed 4 months and the child shows to the satisfaction of the 
Office that he or she has a bona fide intention of continuing to pursue 
a full-time course of study or training; or
    (ii) During periods of reasonable duration in which, in the 
judgment of the Office, the child is prevented by factors beyond the 
child's control from pursuing his or her education.
    (4) A student whose 23rd birthday occurs during a semester or the 
enrollment period in which such student is pursuing a full-time course 
of study or training shall continue to be considered a student until 
the end of such period, unless eligibility is otherwise terminated.


Sec. 725.210  Duration of augmented benefits.

    Augmented benefits payable on behalf of a spouse or divorced 
spouse, or a child, shall begin with the first month in which the 
dependent satisfies the conditions of relationship and dependency set 
forth in this subpart. Augmentation of benefits on account of a 
dependent continues through the month before the month in which the 
dependent ceases to satisfy these conditions, except in the case of a 
child who qualifies as a dependent because such child is a student. In 
the latter case, benefits continue to be augmented through the month 
before the first month during no part of which such child qualifies as 
a student.


Sec. 725.211  Time of determination of relationship and dependency of 
spouse or child for purposes of augmentation of benefits.

    With respect to the spouse or child of a miner entitled to 
benefits, and with respect to the child of a surviving spouse entitled 
to benefits, the determination as to whether an individual purporting 
to be a spouse or child is related to or dependent upon such miner or 
surviving spouse shall be based on the facts and circumstances present 
in each case, at the appropriate time.

Conditions and Duration of Entitlement: Miner's Surviviors


Sec. 725.212  Condition of entitlement; surviving spouse or surviving 
divorced spouse.

    (a) An individual who is the surviving spouse or surviving divorced 
spouse of a miner is eligible for benefits if such individual:
    (1) Is not married;
    (2) Was dependent on the miner at the pertinent time; and
    (3) The deceased miner either:
    (i) Was receiving benefits under section 415 or part C of title IV 
of the Act at the time of death as a result of a claim filed prior to 
January 1, 1982; or
    (ii) Is determined as a result of a claim filed prior to January 1, 
1982, to have been totally disabled due to pneumoconiosis at the time 
of death or to have died due to pneumoconiosis. A surviving spouse or 
surviving divorced spouse of a miner whose claim is filed on or after 
January 1, 1982, must establish that the deceased miner's death was due 
to pneumoconiosis in order to establish entitlement to benefits, except 
where entitlement is established under Sec. 718.306 of part 718 on a 
claim filed prior to June 30, 1982.
    (b) If more than one spouse meets the conditions of entitlement 
prescribed in paragraph (a), then each spouse will be considered a 
beneficiary for purposes of section 412(a)(2) of the Act without regard 
to the existence of any other entitled spouse or spouses.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.213  Duration of entitlement; surviving spouse or surviving 
divorced spouse.

    (a) An individual is entitled to benefits as a surviving spouse, or 
as a surviving divorced spouse, for each month beginning with the first 
month in which all of the conditions of entitlement prescribed in 
Sec. 725.212 are satisfied.
    (b) The last month for which such individual is entitled to such 
benefits is the month before the month in which either of the following 
events first occurs:
    (1) The surviving spouse or surviving divorced spouse marries; or

[[Page 3391]]

    (2) The surviving spouse or surviving divorced spouse dies.
    (c) A surviving spouse or surviving divorced spouse whose 
entitlement to benefits has been terminated pursuant to 
Sec. 725.213(b)(1) may thereafter again become entitled to such 
benefits upon filing application for such reentitlement, beginning with 
the first month after the marriage ends and such individual meets the 
requirements of Sec. 725.212. The individual shall not be required to 
reestablish the miner's entitlement to benefits (Sec. 725.212(a)(3)(i)) 
or the miner's death due to pneumoconiosis (Sec. 725.212(a)(3)(ii)).

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.214  Determination of relationship; surviving spouse.

    An individual shall be considered to be the surviving spouse of a 
miner if:
    (a) The courts of the State in which the miner was domiciled (see 
Sec. 725.231) at the time of his or her death would find that the 
individual and the miner were validly married; or
    (b) The courts of the State in which the miner was domiciled (see 
Sec. 725.231) at the time of the miner's death would find that the 
individual was the miner's surviving spouse; or
    (c) Under State law, such individual would have the right of the 
spouse to share in the miner's interstate personal property; or
    (d) Such individual went through a marriage ceremony with the miner 
resulting in a purported marriage between them and which but for a 
legal impediment (see Sec. 725.230) would have been a valid marriage, 
unless such individual entered into the purported marriage with 
knowledge that it was not a valid marriage, or if such individual and 
the miner were not living in the same household at the time of the 
miner's death.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.215  Determination of dependency; surviving spouse.

    An individual who is the miner's surviving spouse (see 
Sec. 725.214) shall be determined to have been dependent on the miner 
if, at the time of the miner's death:
    (a) The individual was living with the miner (see Sec. 725.232); or
    (b) The individual was dependent upon the miner for support or the 
miner has been ordered by a court to contribute to such individual's 
support (see Sec. 725.233); or
    (c) The individual was living apart from the miner because of the 
miner's desertion or other reasonable cause; or
    (d) The individual is the natural parent of the miner's son or 
daughter; or
    (e) The individual had legally adopted the miner's son or daughter 
while the individual was married to the miner and while such son or 
daughter was under the age of 18; or
    (f) The individual was married to the miner at the time both of 
them legally adopted a child under the age of 18; or
    (g) (1) The individual was married to the miner for a period of not 
less than 9 months immediately before the day on which the miner died, 
unless the miner's death:
    (i) Is accidental (as defined in paragraph (g)(2) of this section), 
or
    (ii) Occurs in line of duty while the miner is a member of a 
uniformed service serving on active duty (as defined in Sec. 404.1019 
of this title), and the surviving spouse was married to the miner for a 
period of not less than 3 months immediately prior to the day on which 
such miner died.
    (2) For purposes of paragraph (g)(l)(i) of this section, the death 
of a miner is accidental if such individual received bodily injuries 
solely through violent, external, and accidental means, and as a direct 
result of the bodily injuries and independently of all other causes, 
dies not later than 3 months after the day on which such miner receives 
such bodily injuries. The term ``accident'' means an event that was 
unpremeditated and unforeseen from the standpoint of the deceased 
individual. To determine whether the death of an individual did, in 
fact, result from an accident the adjudication officer will consider 
all the circumstances surrounding the casualty. An intentional and 
voluntary suicide will not be considered to be death by accident; 
however, suicide by an individual who is so incompetent as to be 
incapable of acting intentionally and voluntarily will be considered to 
be a death by accident. In no event will the death of an individual 
resulting from violent and external causes be considered a suicide 
unless there is direct proof that the fatal injury was self-inflicted.
    (3) The provisions of paragraph (g) shall not apply if the 
adjudication officer determines that at the time of the marriage 
involved, the miner would not reasonably have been expected to live for 
9 months.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.216  Determination of relationship; surviving divorced spouse.

    An individual will be considered to be the surviving divorced 
spouse of a deceased miner in a claim considered under this part or 
reviewed under part 727 of this subchapter (see Sec. 725.4(d)), if such 
individual's marriage to the miner had been terminated by a final 
divorce on or after the 10th anniversary of the marriage unless, if 
such individual was married to and divorced from the miner more than 
once, such individual was married to such miner in each calendar year 
of the period beginning 10 years immediately before the date on which 
any divorce became final and ending with the year in which the divorce 
became final.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.217  Determination of dependency; surviving divorced spouse.

    An individual who is the miner's surviving divorced spouse (see 
Sec. 725.216) shall be determined to have been dependent on the miner 
if, for the month before the month in which the miner died:
    (a) The individual was receiving at least one-half of his or her 
support from the miner (see Sec. 725.233(g)); or
    (b) The individual was receiving substantial contributions from the 
miner pursuant to a written agreement (see Sec. 725.233 (c) and (f)); 
or
    (c) A court order required the miner to furnish substantial 
contributions to the individual's support (see Sec. 725.233 (c) and 
(e)).

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.218  Conditions of entitlement; child.

    (a) An individual is entitled to benefits where he or she meets the 
required standards of relationship and dependency under this subpart 
(see Sec. 725.220 and Sec. 725.221) and is the child of a deceased 
miner who:
    (1) Was receiving benefits under section 415 or part C of title IV 
of the Act as a result of a claim filed prior to January 1, 1982, or
    (2) Is determined as a result of a claim filed prior to January 1, 
1982, to have been totally disabled due to pneumoconiosis at the time 
of death, or to have died due to pneumoconiosis. A surviving dependent 
child of a miner whose claim is filed on or after January 1, 1982, must 
establish that the miner's death was due to pneumoconiosis in order to 
establish entitlement to benefits, except where entitlement is

[[Page 3392]]

established under Sec. 718.306 of part 718 on a claim filed prior to 
June 30, 1982.
    (b) A child is not entitled to benefits for any month for which a 
miner, or the surviving spouse or surviving divorced spouse of a miner, 
establishes entitlement to benefits.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.219  Duration of entitlement; child.

    (a) An individual is entitled to benefits as a child for each month 
beginning with the first month in which all of the conditions of 
entitlement prescribed in Sec. 725.218 are satisfied.
    (b) The last month for which such individual is entitled to such 
benefits is the month before the month in which any one of the 
following events first occurs:
    (1) The child dies;
    (2) The child marries;
    (3) The child attains age 18; and
    (i) Is not a student (as defined in Sec. 725.209(b)) during any 
part of the month in which the child attains age 18; and
    (ii) Is not under a disability (as defined in 
Sec. 725.209(a)(2)(ii)) at that time;
    (4) If the child's entitlement beyond age 18 is based on his or her 
status as a student, the earlier of:
    (i) The first month during no part of which the child is a student; 
or
    (ii) The month in which the child attains age 23 and is not under a 
disability (as defined in Sec. 725.209(a)(2)(ii)) at that time;
    (5) If the child's entitlement beyond age 18 is based on 
disability, the first month in no part of which such individual is 
under a disability.
    (c) A child whose entitlement to benefits terminated with the month 
before the month in which the child attained age 18, or later, may 
thereafter (provided such individual is not married) again become 
entitled to such benefits upon filing application for such 
reentitlement, beginning with the first month after termination of 
benefits in which such individual is a student and has not attained the 
age of 23.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.220  Determination of relationship; child.

    For purposes of determining whether an individual may qualify for 
benefits as the child of a deceased miner, the provisions of 
Sec. 725.208 shall be applicable. As used in this section, the term 
``beneficiary'' means only a surviving spouse entitled to benefits at 
the time of such surviving spouse's death (see Sec. 725.212), or a 
miner. For purposes of a survivor's claim, an individual will be 
considered to be a child of a beneficiary if:
    (a) The courts of the State in which such beneficiary is domiciled 
(see Sec. 725.231) would find, under the law they would apply in 
determining the devolution of the beneficiary's intestate personal 
property, that the individual is the beneficiary's child; or
    (b) Such individual is the legally adopted child of such 
beneficiary; or
    (c) Such individual is the stepchild of such beneficiary by reason 
of a valid marriage of such individual's parent or adopting parent to 
such beneficiary; or
    (d) Such individual does not bear the relationship of child to such 
beneficiary under paragraph (a), (b), or (c) of this section, but 
would, under State law, have the same right as a child to share in the 
beneficiary's intestate personal property; or
    (e) Such individual is the natural son or daughter of a beneficiary 
but does not bear the relationship of child to such beneficiary under 
paragraph (a), (b), or (c) of this section, and is not considered to be 
the child of the beneficiary under paragraph (d) of this section, such 
individual shall nevertheless be considered to be the child of such 
beneficiary if the beneficiary and the mother or father, as the case 
may be, of such individual went through a marriage ceremony resulting 
in a purported marriage between them which but for a legal impediment 
(see Sec. 725.230) would have been a valid marriage; or
    (f) Such individual is the natural son or daughter of a beneficiary 
but does not have the relationship of child to such beneficiary under 
paragraph (a), (b), or (c) of this section, and is not considered to be 
the child of the beneficiary under paragraph (d) or (e) of this 
section, such individual shall nevertheless be considered to be the 
child of such beneficiary if:
    (1) Such beneficiary, prior to his or her entitlement to benefits, 
has acknowledged in writing that the individual is his or her son or 
daughter, or has been decreed by a court to be the father or mother of 
the individual, or has been ordered by a court to contribute to the 
support of the individual (see Sec. 725.233(a)) because the individual 
is a son or daughter; or
    (2) Such beneficiary is shown by satisfactory evidence to be the 
father or mother of the individual and was living with or contributing 
to the support of the individual at the time such beneficiary became 
entitled to benefits.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.221  Determination of dependency; child.

    For the purposes of determining whether a child was dependent upon 
a deceased miner, the provisions of Sec. 725.209 shall be applicable, 
except that for purposes of determining the eligibility of a child who 
is under a disability as defined in section 223(d) of the Social 
Security Act, such disability must have begun before the child attained 
age 22, or in the case of a student, before the child ceased to be a 
student.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.222  Conditions of entitlement; parent, brother, or sister.

    (a) An individual is eligible for benefits as a surviving parent, 
brother or sister if all of the following requirements are met:
    (1) The individual is the parent, brother, or sister of a deceased 
miner;
    (2) The individual was dependent on the miner at the pertinent 
time;
    (3) Proof of support is filed within 2 years after the miner's 
death, unless the time is extended for good cause (Sec. 725.226);
    (4) In the case of a brother or sister, such individual also:
    (i) Is under 18 years of age; or
    (ii) Is under a disability as defined in section 223(d) of the 
Social Security Act, 42 U.S.C. 423(d), which began before such 
individual attained age 22, or in the case of a student, before the 
student ceased to be a student; or
    (iii) Is a student (see Sec. 725.209(b)); or
    (iv) Is under a disability as defined in section 223(d) of the 
Social Security Act, 42 U.S.C. 423(d), at the time of the miner's 
death;
    (5) The deceased miner:
    (i) Was entitled to benefits under section 415 or part C of title 
IV of the Act as a result of a claim filed prior to January 1, 1982; or
    (ii) Is determined as a result of a claim filed prior to January 1, 
1982, to have been totally disabled due to pneumoconiosis at the time 
of death or to have died due to pneumoconiosis. A surviving dependent 
parent, brother or sister of a miner whose claim is filed on or after 
January 1, 1982, must establish that the miner's death was due to 
pneumoconiosis in order to establish entitlement to benefits, except 
where entitlement is established under Sec. 718.306 of part 718 on a 
claim filed prior to June 30, 1982.

[[Page 3393]]

    (b)(1) A parent is not entitled to benefits if the deceased miner 
was survived by a spouse or child at the time of such miner's death.
    (2) A brother or sister is not entitled to benefits if the deceased 
miner was survived by a spouse, child, or parent at the time of such 
miner's death.

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.223  Duration of entitlement; parent, brother, or sister.

    (a) A parent, sister, or brother is entitled to benefits beginning 
with the month all the conditions of entitlement described in 
Sec. 725.222 are met.
    (b) The last month for which such parent is entitled to benefits is 
the month in which the parent dies.
    (c) The last month for which such brother or sister is entitled to 
benefits is the month before the month in which any of the following 
events first occurs:
    (1) The individual dies;
    (2)(i) The individual marries or remarries; or
    (ii) If already married, the individual received support in any 
amount from his or her spouse;
    (3) The individual attains age 18; and
    (i) Is not a student (as defined in Sec. 725.209(b)) during any 
part of the month in which the individual attains age 18; and
    (ii) Is not under a disability (as defined in 
Sec. 725.209(a)(2)(ii)) at that time;
    (4) If the individual's entitlement beyond age 18 is based on his 
or her status as a student, the earlier of:
    (i) The first month during no part of which the individual is a 
student; or
    (ii) The month in which the individual attains age 23 and is not 
under a disability (as defined in Sec. 725.209(a)(2)(ii)) at that time;
    (5) If the individual's entitlement beyond age 18 is based on 
disability, the first month in no part of which such individual is 
under a disability.
    (d) A brother or sister whose entitlement to benefits terminated 
pursuant to Sec. 725.223(c)(2)(i) may thereafter again become entitled 
to such benefits upon filing application for such reentitlement, 
beginning with the first month after the marriage ends and such 
individual meets the requirements of Sec. 725.222. The individual shall 
not be required to reestablish the miner's entitlement to benefits 
(Sec. 725.222(a)(5)(i)) or the miner's death due to pneumoconiosis 
(Sec. 725.222(a)(5)(ii)).

(Approved by the Office of Management and Budget under control 
number 1215-0087)

(Pub. L. No. 96-511)


Sec. 725.224   Determination of relationship; parent, brother, or 
sister.

    (a) An individual will be considered to be the parent, brother, or 
sister of a miner if the courts of the State in which the miner was 
domiciled (see Sec. 225.231) at the time of death would find, under the 
law they would apply, that the individual is the miner's parent, 
brother, or sister.
    (b) Where, under State law, the individual is not the miner's 
parent, brother, or sister, but would, under State law, have the same 
status (i.e., right to share in the miner's intestate personal 
property) as a parent, brother, or sister, the individual will be 
considered to be the parent, brother, or sister as appropriate.


Sec. 725.225   Determination of dependency; parent, brother, or sister.

    An individual who is the miner's parent, brother, or sister will be 
determined to have been dependent on the miner if, during the 1-year 
period immediately prior to the miner's death:
    (a) The individual and the miner were living in the same household 
(see Sec. 725.232); and
    (b) The individual was totally dependent on the miner for support 
(see Sec. 725.233(h)).


Sec. 725.226   ``Good cause'' for delayed filing of proof of support.

    (a) What constitutes ``good cause.'' ``Good cause'' may be found 
for failure to file timely proof of support where the parent, brother, 
or sister establishes to the satisfaction of the Office that such 
failure to file was due to:
    (1) Circumstances beyond the individual's control, such as extended 
illness, mental, or physical incapacity, or communication difficulties; 
or
    (2) Incorrect or incomplete information furnished the individual by 
the Office; or
    (3) Efforts by the individual to secure supporting evidence without 
a realization that such evidence could be submitted after filing proof 
of support.
    (b) What does not constitute ``good cause.'' ``Good cause'' for 
failure to file timely proof of support (see Sec. 725.222(a)(3)) does 
not exist when there is evidence of record in the Office that the 
individual was informed that he or she should file within the 
prescribed period and he or she failed to do so deliberately or through 
negligence.


Sec. 725.227   Time of determination of relationship and dependency of 
survivors.

    The determination as to whether an individual purporting to be an 
entitled survivor of a miner or beneficiary was related to, or 
dependent upon, the miner is made after such individual files a claim 
for benefits as a survivor. Such determination is based on the facts 
and circumstances with respect to a reasonable period of time ending 
with the miner's death. A prior determination that such individual was, 
or was not, a dependent for the purposes of augmenting the miner's 
benefits for a certain period, is not determinative of the issue of 
whether the individual is a dependent survivor of such miner.


Sec. 725.228   Effect of conviction of felonious and intentional 
homicide on entitlement to benefits.

    An individual who has been convicted of the felonious and 
intentional homicide of a miner or other beneficiary shall not be 
entitled to receive any benefits payable because of the death of such 
miner or other beneficiary, and such person shall be considered 
nonexistent in determining the entitlement to benefits of other 
individuals.

Terms Used in this Subpart


Sec. 725.229   Intestate personal property.

    References in this subpart to the ``same right to share in the 
intestate personal property'' of a deceased miner (or surviving spouse) 
refer to the right of an individual to share in such distribution in 
the individual's own right and not the right of representation.


Sec. 725.230   Legal impediment.

    For purposes of this subpart, ``legal impediment'' means an 
impediment resulting from the lack of dissolution of a previous 
marriage or otherwise arising out of such previous marriage or its 
dissolution or resulting from a defect in the procedure followed in 
connection with the purported marriage ceremony--for example, the 
solemnization of a marriage only through a religious ceremony in a 
country which requires a civil ceremony for a valid marriage.


Sec. 725.231   Domicile.

    (a) For purposes of this subpart, the term ``domicile'' means the 
place of an individual's true, fixed, and permanent home.
    (b) The domicile of a deceased miner or surviving spouse is 
determined as of the time of death.
    (c) If an individual was not domiciled in any State at the 
pertinent time, the law of the District of Columbia is applied.

[[Page 3394]]

Sec. 725.232   Member of the same household--''living with,'' ``living 
in the same household,'' and ``living in the miner's household,'' 
defined.

    (a) Defined. (1) The term ``member of the same household'' as used 
in section 402(a)(2) of the Act (with respect to a spouse); the term 
``living with'' as used in section 402(e) of the Act (with respect to a 
surviving spouse); and the term ``living in the same household'' as 
used in this subpart, means that a husband and wife were customarily 
living together as husband and wife in the same place.
    (2) The term ``living in the miner's household'' as used in section 
412(a)(5) of the Act (with respect to a parent, brother, or sister) 
means that the miner and such parent, brother, or sister were sharing 
the same residence.
    (b) Temporary absence. The temporary absence from the same 
residence of either the miner, or the miner's spouse, parent, brother, 
or sister (as the case may be), does not preclude a finding that one 
was ``living with'' the other, or that they were ``members of the same 
household.'' The absence of one such individual from the residence in 
which both had customarily lived shall, in the absence of evidence to 
the contrary, be considered temporary:
    (1) If such absence was due to service in the Armed Forces of the 
United States; or
    (2) If the period of absence from his or her residence did not 
exceed 6 months and the absence was due to business or employment 
reasons, or because of confinement in a penal institution or in a 
hospital, nursing home, or other curative institution; or
    (3) In any other case, if the evidence establishes that despite 
such absence they nevertheless reasonably expected to resume physically 
living together.
    (c) Relevant period of time. (1) The determination as to whether a 
surviving spouse had been ``living with'' the miner shall be based upon 
the facts and circumstances as of the time of the death of the miner.
    (2) The determination as to whether a spouse is a ``member of the 
same household'' as the miner shall be based upon the facts and 
circumstances with respect to the period or periods of time as to which 
the issue of membership in the same household is material.
    (3) The determination as to whether a parent, brother, or sister 
was ``living in the miner's household'' shall take account of the 1-
year period immediately prior to the miner's death.


Sec. 725.233   Support and contributions.

    (a) Support defined. The term ``support'' includes food, shelter, 
clothing, ordinary medical expenses, and other ordinary and customary 
items for the maintenance of the person supported.
    (b) Contributions defined. The term ``contributions'' refers to 
contributions actually provided by the contributor from such 
individual's property, or the use thereof, or by the use of such 
individual's own credit.
    (c) Regular contributions and ``substantial contributions'' 
defined. The terms ``regular contributions'' and ``substantial 
contributions'' mean contributions that are customary and sufficient to 
constitute a material factor in the cost of the individual's support.
    (d) Contributions and community property. When a spouse receives 
and uses for his or her support income from services or property, and 
such income, under applicable State law, is the community property of 
the wife and her husband, no part of such income is a ``contribution'' 
by one spouse to the other's support regardless of the legal interest 
of the donor. However, when a spouse receives and uses for support, 
income from the services and the property of the other spouse and, 
under applicable State law, such income is community property, all of 
such income is considered to be a contribution by the donor to the 
spouse's support.
    (e) Court order for support defined. References to a support order 
in this subpart means any court order, judgment, or decree of a court 
of competent jurisdiction which requires regular contributions that are 
a material factor in the cost of the individual's support and which is 
in effect at the applicable time. If such contributions are required by 
a court order, this condition is met whether or not the contributions 
were actually made.
    (f) Written agreement defined. The term ``written agreement'' in 
the phrase ``substantial contributions pursuant to a written 
agreement'', as used in this subpart means an agreement signed by the 
miner providing for substantial contributions by the miner for the 
individual's support. It must be in effect at the applicable time but 
it need not be legally enforceable.
    (g) One-half support defined. The term ``one-half support'' means 
that the miner made regular contributions, in cash or in kind, to the 
support of a divorced spouse at the specified time or for the specified 
period, and that the amount of such contributions equalled or exceeded 
one-half the total cost of such individual's support at such time or 
during such period.
    (h) Totally dependent for support defined. The term ``totally 
dependent for support'' as used in Sec. 725.225(b) means that the miner 
made regular contributions to the support of the miner's parents, 
brother, or sister, as the case may be, and that the amount of such 
contributions at least equalled the total cost of such individual's 
support.

Subpart C--Filing of Claims


Sec. 725.301   Who may file a claim.

    (a) Any person who believes he or she may be entitled to benefits 
under the Act may file a claim in accordance with this subpart.
    (b) A claimant who has attained the age of 18, is mentally 
competent and physically able, may file a claim on his or her own 
behalf.
    (c) If a claimant is unable to file a claim on his or her behalf 
because of a legal or physical impairment, the following rules shall 
apply:
    (1) A claimant between the ages of 16 and 18 years who is mentally 
competent and not under the legal custody or care of another person, or 
a committee or institution, may upon filing a statement to the effect, 
file a claim on his or her own behalf. In any other case where the 
claimant is under 18 years of age, only a person, or the manager or 
principal officer of an institution having legal custody or care of the 
claimant may file a claim on his or her behalf.
    (2) If a claimant over 18 years of age has a legally appointed 
guardian or committee, only the guardian or committee may file a claim 
on his or her behalf.
    (3) If a claimant over 18 years of age is mentally incompetent or 
physically unable to file a claim and is under the care of another 
person, or an institution, only the person, or the manager or principal 
officer of the institution responsible for the care of the claimant, 
may file a claim on his or her behalf.
    (4) For good cause shown, the Office may accept a claim executed by 
a person other than one described in paragraphs (c) (2) or (3) of this 
section.
    (d) Except as provided in Sec. 725.305 of this part, in order for a 
claim to be considered, the claimant must be alive at the time the 
claim is filed.


Sec. 725.302  Evidence of authority to file a claim on behalf of 
another.

    A person filing a claim on behalf of a claimant shall submit 
evidence of his or her authority to so act at the time of filing or at 
a reasonable time thereafter in accordance with the following:
    (a) A legally appointed guardian or committee shall provide the 
Office with certification of appointment by a proper official of the 
court.
    (b) Any other person shall provide a statement describing his or 
her

[[Page 3395]]

relationship to the claimant, the extent to which he or she has care of 
the claimant, or his or her position as an officer of the institution 
of which the claimant is an inmate. The Office may, at any time, 
require additional evidence to establish the authority of any such 
person.


Sec. 725.303  Date and place of filing of claims.

    (a)(1) Claims for benefits shall be delivered, mailed to, or 
presented at, any of the various district offices of the Social 
Security Administration, or any of the various offices of the 
Department of Labor authorized to accept claims, or, in the case of a 
claim filed by or on behalf of a claimant residing outside the United 
States, mailed or presented to any office maintained by the Foreign 
Service of the United States. A claim shall be considered filed on the 
day it is received by the office in which it is first filed.
    (2) A claim submitted to a Foreign Service Office or any other 
agency or subdivision of the U.S. Government shall be forwarded to the 
Office and considered filed as of the date it was received at the 
Foreign Service Office or other governmental agency or unit.
    (b) A claim submitted by mail shall be considered filed as of the 
date of delivery unless a loss or impairment of benefit rights would 
result, in which case a claim shall be considered filed as of the date 
of its postmark. In the absence of a legible postmark, other evidence 
may be used to establish the mailing date.


Sec. 725.304  Forms and initial processing.

    (a) Claims shall be filed on forms prescribed and approved by the 
Office. The district office at which the claim is filed will assist 
claimants in completing their forms.
    (b) If the place at which a claim is filed is an office of the 
Social Security Administration, such office shall forward the completed 
claim form to an office of the DCMWC, which is authorized to process 
the claim.


Sec. 725.305  When a written statement is considered a claim.

    (a) The filing of a statement signed by an individual indicating an 
intention to claim benefits shall be considered to be the filing of a 
claim for the purposes of this part under the following circumstances:
    (1) The claimant or a proper person on his or her behalf (see 
Sec. 725.301) executes and files a prescribed claim form with the 
Office during the claimant's lifetime within the period specified in 
paragraph (b) of this section.
    (2) Where the claimant dies within the period specified in 
paragraph (b) of this section without filing a prescribed claim form, 
and a person acting on behalf of the deceased claimant's estate 
executes and files a prescribed claim form within the period specified 
in paragraph (c) of this section.
    (b) Upon receipt of a written statement indicating an intention to 
claim benefits, the Office shall notify the signer in writing that to 
be considered the claim must be executed by the claimant or a proper 
party on his or her behalf on the prescribed form and filed with the 
Office within six months from the date of mailing of the notice.
    (c) If before the notice specified in paragraph (b) of this section 
is sent, or within six months after such notice is sent, the claimant 
dies without having executed and filed a prescribed form, or without 
having had one executed and filed in his or her behalf, the Office 
shall upon receipt of notice of the claimant's death advise his or her 
estate, or those living at his or her last known address, in writing 
that for the claim to be considered, a prescribed claim form must be 
executed and filed by a person authorized to do so on behalf of the 
claimant's estate within six months of the date of the later notice.
    (d) Claims based upon written statements indicating an intention to 
claim benefits not perfected in accordance with this section shall not 
be processed.


Sec. 725.306  Withdrawal of a claim.

    (a) A claimant or an individual authorized to execute a claim on a 
claimant's behalf or on behalf of claimant's estate under Sec. 725.305, 
may withdraw a previously filed claim provided that:
    (1) He or she files a written request with the appropriate 
adjudication officer indicating the reasons for seeking withdrawal of 
the claim;
    (2) The appropriate adjudication officer approves the request for 
withdrawal on the grounds that it is in the best interests of the 
claimant or his or her estate, and;
    (3) Any payments made to the claimant in accordance with 
Sec. 725.522 are reimbursed.
    (b) When a claim has been withdrawn under paragraph (a) of this 
section, the claim will be considered not to have been filed.


Sec. 725.307  Cancellation of a request for withdrawal.

    At any time prior to approval, a request for withdrawal may be 
canceled by a written request of the claimant or a person authorized to 
act on the claimant's behalf or on behalf of the claimant's estate.


Sec. 725.308  Time limits for filing claims.

    (a) A claim for benefits filed under this part by, or on behalf of, 
a miner shall be filed within three years after a medical determination 
of total disability due to pneumoconiosis which has been communicated 
to the miner or a person responsible for the care of the miner, or 
within three years after the date of enactment of the Black Lung 
Benefits Reform Act of 1977, whichever is later. There is no time limit 
on the filing of a claim by the survivor of a miner.
    (b) A miner who is receiving benefits under part B of title IV of 
the Act and who is notified by HEW of the right to seek medical 
benefits may file a claim for medical benefits under part C of title IV 
of the Act and this part. The Secretary of Health, Education, and 
Welfare is required to notify each miner receiving benefits under part 
B of this right. Notwithstanding the provisions of paragraph (a) of 
this section, a miner notified of his or her rights under this 
paragraph may file a claim under this part on or before December 31, 
1980. Any claim filed after that date shall be untimely unless the time 
for filing has been enlarged for good cause shown.
    (c) There shall be a rebuttable presumption that every claim for 
benefits is timely filed. However, except as provided in paragraph (b) 
of this section, the time limits in this section are mandatory and may 
not be waived or tolled except upon a showing of extraordinary 
circumstances.


Sec. 725.309  Additional claims; effect of a prior denial of benefits.

    (a) A claimant whose claim for benefits was previously approved 
under part B of title IV of the Act may file a claim for benefits under 
this part as provided in Secs. 725.308(b) and 725.702.
    (b) If a claimant files a claim under this part while another claim 
filed by the claimant under this part is still pending, the later claim 
shall be merged with the earlier claim for all purposes. For purposes 
of this section, a claim shall be considered pending if it has not yet 
been finally denied.
    (c) If a claimant files a claim under this part within one year 
after the effective date of a final order denying a claim previously 
filed by the claimant under this part (see Sec. 725.502(a)(2)), the 
later claim shall be considered a request for modification of the prior 
denial and shall be processed and adjudicated under Sec. 725.310 of 
this part.
    (d) If a claimant files a claim under this part more than one year 
after the effective date of a final order denying a

[[Page 3396]]

claim previously filed by the claimant under this part (see 
Sec. 725.502(a)(2)), the later claim shall be considered a subsequent 
claim for benefits. A subsequent claim shall be processed and 
adjudicated in accordance with the provisions of subparts E and F of 
this part, except that the claim shall be denied unless the claimant 
demonstrates that one of the applicable conditions of entitlement (see 
Secs. 725.202(d) (miner), 725.212 (spouse), 725.218 (child), and 
725.222 (parent, brother, or sister)) has changed since the date upon 
which the order denying the prior claim became final. The applicability 
of this paragraph may be waived by the operator or fund, as 
appropriate. The following additional rules shall apply to the 
adjudication of a subsequent claim:
    (1) Any evidence submitted in connection with any prior claim shall 
be made a part of the record in the subsequent claim, provided that it 
was not excluded in the adjudication of the prior claim.
    (2) For purposes of this section, the applicable conditions of 
entitlement shall be limited to those conditions upon which the prior 
denial was based. For example, if the claim was denied solely on the 
basis that the individual was not a miner, the subsequent claim must be 
denied unless the individual worked as a miner following the prior 
denial. Similarly, if the claim was denied because the miner did not 
meet one or more of the eligibility criteria contained in part 718 of 
this subchapter, the subsequent claim must be denied unless the miner 
meets at least one of the criteria that he or she did not meet 
previously.
    (3) If the applicable condition(s) of entitlement relate to the 
miner's physical condition and the new evidence submitted in connection 
with the subsequent claim pursuant to Sec. 725.413 of this part 
establishes at least one applicable condition of entitlement, there 
shall be a rebuttable presumption that the miner's physical condition 
has changed. The presumption may be rebutted only if an evaluation of 
the record compiled in the prior claim reveals that the order denying 
that claim is clearly erroneous and that the claim should have been 
approved as a matter of law. If the presumption is rebutted, the 
claimant shall bear the burden of proving that his pulmonary or 
respiratory condition has significantly deteriorated since the date 
upon which the order denying the prior claim became final. The 
provisions of paragraph (d)(3) shall not be applicable in the case of a 
claim filed by a surviving spouse, child, parent, brother, or sister.
    (4) If the claimant demonstrates a change in one of the applicable 
conditions of entitlement, no findings made in connection with the 
prior claim, except those based on a party's failure to contest an 
issue (see Sec. 725.463), shall be binding on any party in the 
adjudication of the subsequent claim. However, any stipulation made by 
any party in connection with the prior claim shall be binding on that 
party in the adjudication of the subsequent claim.
    (5) In any case in which a subsequent claim is awarded, no benefits 
may be paid for any period prior to the date upon which the order 
denying the prior claim became final.
    (e) Notwithstanding any other provision of this part or part 727 of 
this subchapter (see Sec. 725.4(d)), a person may exercise the right of 
review provided in paragraph (c) of Sec. 727.103 at the same time such 
person is pursuing an appeal of a previously denied part B claim under 
the law as it existed prior to March 1, 1978. If the part B claim is 
ultimately approved as a result of the appeal, the claimant must 
immediately notify the Secretary of Labor and, where appropriate, the 
coal mine operator, and all duplicate payments made under part C shall 
be considered an overpayment and arrangements shall be made to insure 
the repayment of such overpayments to the fund or an operator, as 
appropriate.
    (f) In any case involving more than one claim filed by the same 
claimant, under no circumstances are duplicate benefits payable for 
concurrent periods of eligibility. Any duplicate benefits paid shall be 
subject to collection or offset under subpart H of this part.


Sec. 725.310  Modification of awards and denials.

    (a) Upon his or her own initiative, or upon the request of any 
party on grounds of a change in conditions or because of a mistake in a 
determination of fact, the district director may, at any time before 
one year from the date of the last payment of benefits, or at any time 
before one year after the denial of a claim, reconsider the terms of an 
award or denial of benefits.
    (b) Modification proceedings shall be conducted in accordance with 
the provisions of this part as appropriate, except that the claimant 
and the operator, or group of operators or the fund, as appropriate, 
shall each be entitled to submit no more than one additional pulmonary 
evaluation or consultative report, in accordance with the provisions of 
Sec. 725.414 of this part, along with such rebuttal evidence as may be 
required. Modification proceedings shall not be initiated before an 
administrative law judge or the Benefits Review Board.
    (c) At the conclusion of modification proceedings before the 
district director, the district director may issue a proposed decision 
and order (Sec. 725.418) or, if appropriate, deny the claim by reason 
of abandonment (Sec. 725.409). In any case in which the district 
director has initiated modification proceedings on his own initiative 
to alter the terms of an award or denial of benefits issued by an 
administrative law judge, the district director shall, at the 
conclusion of modification proceedings, forward the claim for a hearing 
(Sec. 725.421). In any case forwarded for a hearing, the administrative 
law judge assigned to hear such case shall consider whether any 
additional evidence submitted by the parties demonstrates a change in 
condition and, regardless of whether the parties have submitted new 
evidence, whether the evidence of record demonstrates a mistake in a 
determination of fact.
    (d) An order issued following the conclusion of modification 
proceedings may terminate, continue, reinstate, increase or decrease 
benefit payments or award benefits. Such order shall not affect any 
benefits previously paid, except that an order increasing the amount of 
benefits payable based on a finding of a mistake in a determination of 
fact may be made effective on the date from which benefits were 
determined payable by the terms of an earlier award. In the case of an 
award which is decreased, no payment made in excess of the decreased 
rate prior to the date upon which the party requested reconsideration 
under paragraph (a) or, in a case in which no request was made, the 
district director initiated modification proceedings, shall be subject 
to collection or offset under subpart H of this part. In the case of an 
award which is terminated, no payment made prior to the date upon which 
the party requested reconsideration under paragraph (a) or, in a case 
in which no request was made, the district director initiated 
modification proceedings, shall be subject to collection or offset 
under subpart H of this part.


Sec. 725.311  Communications with respect to claims; time computations.

    (a) Unless otherwise specified by this part, all requests, 
responses, notices, decisions, orders, or other communications required 
or permitted by this part shall be in writing.
    (b) If required by this part, any document, brief, or other 
statement

[[Page 3397]]

submitted in connection with the adjudication of a claim under this 
part shall be sent to each party to the claim by the submitting party. 
If proof of service is required with respect to any communication, such 
proof of service shall be submitted to the appropriate adjudication 
officer and filed as part of the claim record.
    (c) In computing any period of time described in this part, by any 
applicable statute, or by the order of any adjudication officer, the 
day of the act or event from which the designated period of time begins 
to run shall not be included. The last day of the period shall be 
included unless it is a Saturday, Sunday, or legal holiday, in which 
event the period extends until the next day which is not a Saturday, 
Sunday, or legal holiday. ``Legal holiday'' includes New Year's Day, 
Birthday of Martin Luther King, Jr., Washington's Birthday, Memorial 
Day, Independence Day, Labor Day, Columbus Day, Veterans Day, 
Thanksgiving Day, Christmas Day and any other day appointed as a 
holiday by the President or the Congress of the United States.
    (d) In any case in which a provision of this part requires a 
document to be sent to a person or party by certified mail, and the 
document is not sent by certified mail, but the person or party 
actually received the document, the document shall be deemed to have 
been sent in compliance with the provisions of this part. In such a 
case, any time period which commences upon the service of the document 
shall commence on the date the document was received.

Subpart D--Adjudication Officers; Parties and Representatives


Sec. 725.350  Who are the adjudication officers.

    (a) General. The persons authorized by the Secretary of Labor to 
accept evidence and decide claims on the basis of such evidence are 
called ``adjudication officers.'' This section describes the status of 
black lung claims adjudication officers.
    (b) District Director. The district director is that official of 
the DCMWC or his designee who is authorized to perform functions with 
respect to the development, processing, and adjudication of claims in 
accordance with this part.
    (c) Administrative law judge. An administrative law judge is that 
official appointed pursuant to 5 U.S.C. 3105 (or Public Law 94-504) who 
is qualified to preside at hearings under 5 U.S.C. 557 and is empowered 
by the Secretary to conduct formal hearings with respect to, and 
adjudicate, claims in accordance with this part. A person appointed 
under Public Law 94-504 shall not be considered an administrative law 
judge for purposes of this part for any period after March 1, 1979.


Sec. 725.351  Powers of adjudication officers.

    (a) District Director. The district director is authorized to:
    (1) Make determinations with respect to claims as is provided in 
this part;
    (2) Conduct conferences and informal discovery proceedings as 
provided in this part;
    (3) Compel the production of documents by the issuance of a 
subpoena, with the written approval of the Director;
    (4) Prepare documents for the signature of parties;
    (5) Issue appropriate orders as provided in this part; and
    (6) Do all other things necessary to enable him or her to discharge 
the duties of the office.
    (b) Administrative Law Judge. An administrative law judge is 
authorized to:
    (1) Conduct formal hearings in accordance with the provisions of 
this part;
    (2) Administer oaths and examine witnesses;
    (3) Compel the production of documents and appearance of witnesses 
by the issuance of subpoenas;
    (4) Issue decisions and orders with respect to claims as provided 
in this part; and
    (5) Do all other things necessary to enable him or her to discharge 
the duties of the office.
    (c) If any person in proceedings before an adjudication officer 
disobeys or resists any lawful order or process, or misbehaves during a 
hearing or so near the place thereof as to obstruct the same, or 
neglects to produce, after having been ordered to do so, any pertinent 
book, paper or document, or refuses to appear after having been 
subpoenaed, or upon appearing refuses to take the oath as a witness, or 
after having taken the oath refuses to be examined according to law, 
the district director with the approval of the Director, or the 
administrative law judge responsible for the adjudication of the claim, 
shall certify the facts to the Federal district court having 
jurisdiction in the place in which he or she is sitting (or to the U.S. 
District Court for the District of Columbia if he or she is sitting in 
the District) which shall thereupon in a summary manner hear the 
evidence as to the acts complained of, and, if the evidence so 
warrants, punish such person in the same manner and to the same extent 
as for a contempt committed before the court, or commit such person 
upon the same condition as if the doing of the forbidden act had 
occurred with reference to the process or in the presence of the court.


Sec. 725.352  Disqualification of adjudication officer.

    (a) No adjudication officer shall conduct any proceedings in a 
claim in which he or she is prejudiced or partial, or where he or she 
has any interest in the matter pending for decision. A decision to 
withdraw from the consideration of a claim shall be within the 
discretion of the adjudication officer. If that adjudication officer 
withdraws, another officer shall be designated by the Director or the 
Chief Administrative Law Judge, as the case may be, to complete the 
adjudication of the claim.
    (b) No adjudication officer shall be permitted to appear or act as 
a representative of a party under this part while such individual is 
employed as an adjudication officer. No adjudication officer shall be 
permitted at any time to appear or act as a representative in 
connection with any case or claim in which he or she was personally 
involved. No fee or reimbursement shall be awarded under this part to 
an individual who acts in violation of this paragraph.
    (c) No adjudication officer shall act in any claim involving a 
party which employed such adjudication officer within one year before 
the adjudication of such claim.
    (d) Notwithstanding paragraph (a) of this section, no adjudication 
officer shall be permitted to act in any claim involving a party who is 
related to the adjudication officer by consanguinity or affinity within 
the third degree as determined by the law of the place where such party 
is domiciled. Any action taken by an adjudication officer in knowing 
violation of this paragraph shall be void.


Sec. 725.360  Parties to proceedings.

    (a) Except as provided in Sec. 725.361, no person other than the 
Secretary of Labor and authorized personnel of the Department of Labor 
shall participate at any stage in the adjudication of a claim for 
benefits under this part, unless such person is determined by the 
appropriate adjudication officer to qualify under the provisions of 
this section as a party to the claim. The following persons shall be 
parties:
    (1) The claimant;
    (2) A person other than a claimant, authorized to execute a claim 
on such claimant's behalf under Sec. 725.301;

[[Page 3398]]

    (3) Any coal mine operator notified under Sec. 725.407 of its 
possible liability for the claim;
    (4) Any insurance carrier of such operator; and
    (5) The Director in all proceedings relating to a claim for 
benefits under this part.
    (b) A widow, child, parent, brother, or sister, or the 
representative of a decedent's estate, who makes a showing in writing 
that his or her rights with respect to benefits may be prejudiced by a 
decision of an adjudication officer, may be made a party.
    (c) Any coal mine operator or prior operator or insurance carrier 
which has not been notified under Sec. 725.407 and which makes a 
showing in writing that its rights may be prejudiced by a decision of 
an adjudication officer may be made a party.
    (d) Any other individual may be made a party if that individual's 
rights with respect to benefits may be prejudiced by a decision to be 
made.


Sec. 725.361  Party amicus curiae.

    At the discretion of the Chief Administrative Law Judge or the 
administrative law judge assigned to the case, a person or entity which 
is not a party may be allowed to participate amicus curiae in a formal 
hearing only as to an issue of law. A person may participate amicus 
curiae in a formal hearing upon written request submitted with 
supporting arguments prior to the hearing. If the request is granted, 
the administrative law judge hearing the case will inform the party of 
the extent to which participation will be permitted. The request may, 
however, be denied summarily and without explanation.


Sec. 725.362  Representation of parties.

    (a) Except for the Secretary of Labor, whose interests shall be 
represented by the Solicitor of Labor or his or her designee, each of 
the parties may appoint an individual to represent his or her interest 
in any proceeding for determination of a claim under this part. Such 
appointment shall be made in writing or on the record at the hearing. 
An attorney qualified in accordance with Sec. 725.363(a) shall file a 
written declaration that he or she is authorized to represent a party, 
or declare his or her representation on the record at a formal hearing. 
Any other person (see Sec. 725.363(b)) shall file a written notice of 
appointment signed by the party or his or her legal guardian, or enter 
his or her appearance on the record at a formal hearing if the party he 
or she seeks to represent is present and consents to the 
representation. Any written declaration or notice required by this 
section shall include the OWCP number assigned by the Office and shall 
be sent to the Office or, for representation at a formal hearing, to 
the Chief Administrative Law Judge. In any case, such representative 
must be qualified under Sec. 725.363. No authorization for 
representation or agreement between a claimant and representative as to 
the amount of a fee, filed with the Social Security Administration in 
connection with a claim under part B of title IV of the Act, shall be 
valid under this part. A claimant who has previously authorized a 
person to represent him or her in connection with a claim originally 
filed under part B of title IV may renew such authorization by filing a 
statement to such effect with the Office or appropriate adjudication 
officer.
    (b) Any party may waive his or her right to be represented in the 
adjudication of a claim. If an adjudication officer determines, after 
an appropriate inquiry has been made, that a claimant who has been 
informed of his or her right to representation does not wish to obtain 
the services of a representative, such adjudication officer shall 
proceed to consider the claim in accordance with this part, unless it 
is apparent that the claimant is, for any reason, unable to continue 
without the help of a representative. However, it shall not be 
necessary for an adjudication officer to inquire as to the ability of a 
claimant to proceed without representation in any adjudication taking 
place without a hearing. The failure of a claimant to obtain 
representation in an adjudication taking place without a hearing shall 
be considered a waiver of the claimant's right to representation. 
However, at any time during the processing or adjudication of a claim, 
any claimant may revoke such waiver and obtain a representative.


Sec. 725.363  Qualification of representative.

    (a) Attorney. Any attorney in good standing who is admitted to 
practice before a court of a State, territory, district, or insular 
possession, or before the Supreme Court of the United States or other 
Federal court and is not, pursuant to any provision of law, prohibited 
from acting as a representative, may be appointed as a representative.
    (b) Other person. With the approval of the adjudication officer, 
any other person may be appointed as a representative so long as that 
person is not, pursuant to any provision of law, prohibited from acting 
as a representative.


Sec. 725.364  Authority of representative.

    A representative, appointed and qualified as provided in 
Secs. 725.362 and 725.363, may make or give on behalf of the party he 
or she represents, any request or notice relative to any proceeding 
before an adjudication officer, including formal hearing and review, 
except that such representative may not execute a claim for benefits, 
unless he or she is a person designated in Sec. 725.301 as authorized 
to execute a claim. A representative shall be entitled to present or 
elicit evidence and make allegations as to facts and law in any 
proceeding affecting the party represented and to obtain information 
with respect to the claim of such party to the same extent as such 
party. Notice given to any party of any administrative action, 
determination, or decision, or request to any party for the production 
of evidence shall be sent to the representative of such party and such 
notice or request shall have the same force and effect as if it had 
been sent to the party represented.


Sec. 725.365  Approval of representative's fees; lien against benefits.

    No fee charged for representation services rendered to a claimant 
with respect to any claim under this part shall be valid unless 
approved under this subpart. No contract or prior agreement for a fee 
shall be valid. In cases where the obligation to pay the attorney's fee 
is upon the claimant, the amount of the fee awarded may be made a lien 
upon the benefits due under an award and the adjudication officer shall 
fix, in the award approving the fee, such lien and the manner of 
payment of the fee. Any representative who is not an attorney may be 
awarded a fee for services under this subpart, except that no lien may 
be imposed with respect to such representative's fee.


Sec. 725.366  Fees for representatives.

    (a) A representative seeking a fee for services performed on behalf 
of a claimant shall make application therefor to the district director, 
administrative law judge, or appropriate appellate tribunal, as the 
case may be, before whom the services were performed. The application 
shall be filed and served upon the claimant and all other parties 
within the time limits allowed by the district director, administrative 
law judge, or appropriate appellate tribunal. The application shall be 
supported by a complete statement of the extent and character of the 
necessary work done, and shall indicate the professional status (e.g., 
attorney, paralegal, law clerk, lay representative or clerical) of the 
person performing such work, and

[[Page 3399]]

the customary billing rate for each such person. The application shall 
also include a listing of reasonable unreimbursed expenses, including 
those for travel, incurred by the representative or an employee of a 
representative in establishing the claimant's case. Any fee requested 
under this paragraph shall also contain a description of any fee 
requested, charged, or received for services rendered to the claimant 
before any State or Federal court or agency in connection with a 
related matter.
    (b) Any fee approved under paragraph (a) of this section shall be 
reasonably commensurate with the necessary work done and shall take 
into account the quality of the representation, the qualifications of 
the representative, the complexity of the legal issues involved, the 
level of proceedings to which the claim was raised, the level at which 
the representative entered the proceedings, and any other information 
which may be relevant to the amount of fee requested. No fee approved 
shall include payment for time spent in preparation of a fee 
application. No fee shall be approved for work done on claims filed 
between December 30, 1969, and June 30, 1973, under part B of title IV 
of the Act, except for services rendered on behalf of the claimant in 
regard to the review of the claim under section 435 of the Act and part 
727 of this subchapter (see Sec. 725.4(d)).
    (c) In awarding a fee, the appropriate adjudication officer shall 
consider, and shall add to the fee, the amount of reasonable and 
unreimbursed expenses incurred in establishing the claimant's case. 
Reimbursement for travel expenses incurred by an attorney shall be 
determined in accordance with the provisions of Sec. 725.459(a). No 
reimbursement shall be permitted for expenses incurred in obtaining 
medical or other evidence which has previously been submitted to the 
Office in connection with the claim.
    (d) Upon receipt of a request for approval of a fee, such request 
shall be reviewed and evaluated by the appropriate adjudication officer 
and a fee award issued. Any party may request reconsideration of a fee 
awarded by the adjudication officer. A revised or modified fee award 
may then be issued, if appropriate.
    (e) Each request for reconsideration or review of a fee award shall 
be in writing and shall contain supporting statements or information 
pertinent to any increase or decrease requested. If a fee awarded by a 
district director is disputed, such award shall be appealable directly 
to the Benefits Review Board. In such a fee dispute case, the record 
before the Board shall consist of the order of the district director 
awarding or denying the fee, the application for a fee, any written 
statement in opposition to the fee and the documentary evidence 
contained in the file which verifies or refutes any item claimed in the 
fee application.


Sec. 725.367  Payment of a claimant's attorney's fee by responsible 
operator or fund.

    (a) An attorney who represents a claimant in the successful 
prosecution of a claim for benefits may be entitled to collect a 
reasonable attorney's fee from the responsible operator that is 
ultimately found liable for the payment of benefits, or, in a case in 
which there is no operator who is liable for the payment of benefits, 
from the fund. Generally, an attorney who represents a successful 
claimant may obtain payment of his or her fee where the operator or 
fund, as appropriate, took action, or acquiesced in action, that 
created an adversarial relationship between itself and the claimant. 
Circumstances in which a successful attorney's fees shall be payable by 
the responsible operator or the fund include, but are not limited to, 
the following:
    (1) If the responsible operator initially found to be liable for 
the payment of benefits by the district director (see Sec. 725.410(a)) 
contests the claimant's eligibility for benefits, either by filing a 
response pursuant to Sec. 725.411(b)(1), or, in a case in which the 
district director issues an initial finding that the claimant is not 
eligible for benefits, by failing to file a response. The operator that 
is ultimately determined to be liable for benefits shall be liable for 
an attorney's fee with respect to all reasonable services performed by 
the claimant's attorney after the date of the responsible operator's 
response or the date on which it was due, whichever is earlier;
    (2) If there is no operator that may be held liable for the payment 
of benefits, and the district director issues an initial finding that 
the claimant is not eligible for benefits. The fund shall be liable for 
an attorney's fee with respect to all reasonable services performed by 
the claimant's attorney after the date on which the district director 
issued the initial finding;
    (3) If the claimant submits a bill for medical treatment, and the 
party liable for the payment of benefits declines to pay the bill on 
the grounds that the treatment is unreasonable, or is for a condition 
that is not compensable. The responsible operator or fund, as 
appropriate, shall be liable for an attorney's fee with respect to all 
reasonable services performed by the claimant's attorney after the date 
on which the liable party declined to pay;
    (4) If a beneficiary seeks an increase in the amount of benefits 
payable, and the responsible operator or fund issues a notice of 
controversion contesting the claimant's right to that increase. If the 
beneficiary is successful in securing an increase in the amount of 
benefits payable, the operator or fund shall be liable for an 
attorney's fee with respect to all reasonable services performed by the 
beneficiary's attorney after the date on which the operator or fund 
contested the increase; and
    (5) If the responsible operator or fund seeks a decrease in the 
amount of benefits payable. If the beneficiary is successful in 
resisting the request for a decrease in the amount of benefits payable, 
the operator or fund shall be liable for an attorney's fee with respect 
to all reasonable services performed by the beneficiary's attorney 
after the date of the request by the operator or fund. A request for 
information clarifying the amount of benefits payable shall not be 
considered a request to decrease that amount.
    (b) In no event shall an operator or the fund be liable for the 
payment of attorney's fees with respect to any services performed prior 
to the dates specified in this section.
    (c) Any fee awarded under this section shall be in addition to the 
award of benefits, and shall be awarded, in an order, by the district 
director, administrative law judge, Board or court, before whom the 
work was performed. The operator or fund shall pay such fee promptly 
and directly to the claimant's attorney in a lump sum after the award 
of benefits becomes final.
    (d) Section 205(a) of the Black Lung Benefits Amendments of 1981, 
Public Law 97-119, amended section 422 of the Act and relieved 
operators and carriers from liability for the payment of benefits on 
certain claims. Payment of benefits on those claims was made the 
responsibility of the fund. The claims subject to this transfer of 
liability are described in Sec. 725.496 of this part. On claims subject 
to the transfer of liability described in this paragraph the fund will 
pay all fees and costs which have been or will be awarded to claimant's 
attorneys which were or would have become the liability of an operator 
or carrier but for the enactment of the 1981 Amendments and which have 
not already been paid by such operator or carrier. Section 9501(d)(7) 
of the Internal Revenue Code, which was also enacted as a part of the 
1981 Amendments to the Act, expressly prohibits the fund from 
reimbursing an

[[Page 3400]]

operator or carrier for any attorney fees or costs which it has paid on 
cases subject to the transfer of liability provisions.

Subpart E--Adjudication of Claims by the District Director


Sec. 725.401  Claims development--general.

    After a claim has been received by the district director, the 
district director shall take such action as is necessary to develop, 
process, and make determinations with respect to the claim as provided 
in this subpart.


Sec. 725.402  Approved State workers' compensation law.

    If a district director determines that any claim filed under this 
part is one subject to adjudication under a workers' compensation law 
approved under part 722 of this subchapter, he or she shall advise the 
claimant of this determination and of the Act's requirement that the 
claim must be filed under the applicable State workers' compensation 
law. The district director shall then prepare a proposed decision and 
order dismissing the claim for lack of jurisdiction pursuant to 
Sec. 725.418 and proceed as appropriate.


Sec. 725.403  Requirement to file under State workers' compensation 
law--section 415 claims.

    (a) No benefits shall be payable to or on behalf of a claimant who 
has filed a claim under section 415 of part B of title IV of the Act, 
for any period of eligibility occurring between July 1, and December 
31, 1973, unless the claimant has filed and diligently pursued a claim 
for benefits under an applicable State workers' compensation law. A 
State workers' compensation claim need not be filed where filing would 
be futile. It shall be determined that the filing of a State claim 
would be futile when:
    (1) The period within which the claim may be filed under such law 
has expired; or
    (2) Pneumoconiosis as defined in part 718 of this subchapter is not 
compensable under such law; or
    (3) The maximum amount of compensation or the maximum number of 
compensation payments allowable under such law has already been paid; 
or
    (4) The claimant does not meet one or more conditions of 
eligibility for workers' compensation payments under applicable State 
law; or
    (5) The claimant otherwise establishes to the satisfaction of the 
Office that the filing of a claim under State law would be futile.
    (b) Where the Office determines that a claimant is required to file 
a State claim under this section, the Office shall so notify the 
claimant. Such notice shall instruct the claimant to file a State claim 
within 30 days of such notice. If no such State claim is filed within 
the 30-day period, no benefits shall be payable under this part to the 
claimant for any period between July 1, and December 31, 1973.
    (c) The failure of a claimant to comply with paragraph (a) of this 
section shall not absolve any operator of its liability for the payment 
of benefits to a claimant for periods of eligibility occurring on or 
after January 1, 1974.
    (d) The district director may determine that a claimant is 
ineligible for benefits under section 415 of part B of title IV of the 
Act without requiring the claimant to file a claim under a State 
workers' compensation law.


Sec. 725.404  Development of evidence--general.

    (a) Employment history. Each claimant shall furnish the district 
director with a complete and detailed history of the coal miner's 
employment and, upon request, supporting documentation.
    (b) Matters of record. Where it is necessary to obtain proof of 
age, marriage or termination of marriage, death, family relationship, 
dependency (see subpart B of this part), or any other fact which may be 
proven as a matter of public record, the claimant shall furnish such 
proof to the district director upon request.
    (c) Documentary evidence. If a claimant is required to submit 
documents to the district director, the claimant shall submit either 
the original, a certified copy or a clear readable copy thereof. The 
district director or administrative law judge may require the 
submission of an original document or certified copy thereof, if 
necessary.
    (d) Submission of insufficient evidence. In the event a claimant 
submits insufficient evidence regarding any matter, the district 
director shall inform the claimant of what further evidence is 
necessary and request that such evidence be submitted within a 
specified reasonable time which may, upon request, be extended for good 
cause.


Sec. 725.405  Development of medical evidence; scheduling of medical 
examinations and tests.

    (a) Upon receipt of a claim, the district director shall ascertain 
whether the claim was filed by or on account of a miner as defined in 
Sec. 725.202, and in the case of a claim filed on account of a deceased 
miner, whether the claim was filed by an eligible survivor of such 
miner as defined in subpart B of this part.
    (b) In the case of a claim filed by or on behalf of a miner, the 
district director shall, where necessary, schedule the miner for a 
medical examination and testing under Sec. 725.406.
    (c) In the case of a claim filed by or on behalf of a survivor of a 
miner, the district director shall obtain whatever medical evidence is 
necessary and available for the development and evaluation of the 
claim.
    (d) The district director shall, where appropriate, collect other 
evidence necessary to establish:
    (1) The nature and duration of the miner's employment; and
    (2) All other matters relevant to the determination of the claim.
    (e) If at any time during the processing of the claim by the 
district director, the evidence establishes that the claimant is not 
entitled to benefits under the Act, the district director may terminate 
evidentiary development of the claim and proceed as appropriate.


Sec. 725.406  Medical examinations and tests.

    (a) The Act requires the Department to provide each miner who 
applies for benefits with the opportunity to undergo a complete 
pulmonary evaluation at no expense to the miner. A complete pulmonary 
evaluation includes a report of physical examination, a pulmonary 
function study, a chest roentgenogram and, unless medically 
contraindicated, a blood gas study.
    (b) The district director will arrange for each miner to be given a 
complete pulmonary evaluation by a physician or medical facility 
selected by the Office. The evaluation shall be conducted, if possible, 
in the vicinity of the miner's residence. The district director will 
notify the miner of these arrangements, and inform the miner that he 
may select an alternate physician or facility. The district director 
will also inform the miner of the consequences of selecting an 
alternate physician or facility, as provided by paragraphs (c) and (d) 
of this section.
    (c) If the miner selects an alternate physician or facility, the 
complete pulmonary evaluation performed under this section shall count 
as one of the two evaluations which the claimant may submit in support 
of his claim (see Sec. 725.414). If the physician or facility selected 
by the miner cannot perform one or more of the tests which make up a 
complete pulmonary evaluation, the district director will arrange for 
the miner to have these tests performed at a facility selected by the 
Office prior to

[[Page 3401]]

his examination by the physician or facility he has selected. A copy of 
any such tests shall be provided to the physician or facility selected 
by the miner.
    (d) If any medical examination or test conducted under paragraph 
(a) of this section is not administered or reported in substantial 
compliance with the provisions of part 718 of this subchapter, or does 
not provide sufficient information to allow the district director to 
decide whether the miner is eligible for benefits, the district 
director shall schedule the miner for further examination and testing 
where necessary and appropriate, provided that the deficiencies in the 
report are not the result of any lack of effort on the part of the 
miner. In order to determine whether any medical examination or test 
was administered and reported in substantial compliance with the 
provisions of part 718 of this subchapter, the district director may 
have any component of such examination or test reviewed by a physician 
selected by the district director. If the miner selected the physician 
or facility that performed the test, the district director shall notify 
the miner, and the physician or facility, of the reasons why the report 
is not in substantial compliance with the provisions of part 718, or 
does not provide sufficient information, and shall allow the miner 
reasonable additional time within which to correct any deficiency.
    (e) If, at any time after the completion of the initial complete 
pulmonary evaluation, unresolved medical questions remain, the district 
director may cause the claimant to be examined by a physician or 
medical facility selected by the district director. If additional 
medical evidence is obtained in accordance with this paragraph, the 
district director may order the physician selected to retest or 
reexamine the miner to do so without the presence or participation of 
any other physician who previously examined the miner, and without 
benefit of the conclusions of any other physician who has examined the 
miner.
    (f) The cost of any medical examination or test authorized under 
this section, including the cost of travel to and from the examination, 
shall be paid by the fund. No reimbursement for overnight 
accommodations shall be authorized unless the district director 
determines that an adequate testing facility is unavailable within one 
day's round trip travel by automobile from the miner's residence. The 
fund shall be reimbursed for such payments by an operator, if any, 
found liable for the payment of benefits to the claimant. If an 
operator fails to repay such expenses, with interest, upon request of 
the Office, the entire amount may be collected in an action brought 
under section 424 of the Act and Sec. 725.603 of this part.


Sec. 725.407  Identification and notification of responsible operator.

    (a) Upon receipt of the miner's employment history, the district 
director shall investigate whether any operator may be held liable for 
the payment of benefits as a responsible operator in accordance with 
the criteria contained in subpart G of this part.
    (b) Prior to issuing an initial finding pursuant to Sec. 725.410, 
the district director may identify one or more operators potentially 
liable for the payment of benefits in accordance with the criteria set 
forth in Sec. 725.495 of this part. The district director shall notify 
each such operator of the existence of the claim. Where the records 
maintained by the Office pursuant to part 726 of this subchapter 
indicate that the operator had obtained a policy of insurance, and the 
claim falls within such policy, the notice provided pursuant to this 
section shall also be sent to the operator's carrier. Any operator or 
carrier notified of the claim shall thereafter be considered a party to 
the claim in accordance with Sec. 725.360 of this part unless it is 
dismissed by an adjudication officer and is not thereafter notified 
again of its potential liability.
    (c) The notification issued pursuant to this section shall include 
a copy of the claimant's application and a copy of all evidence 
obtained by the district director relating to the miner's employment. 
The district director may request the operator to answer specific 
questions, including, but not limited to, questions related to the 
nature of its operations, its relationship with the miner, its 
financial status, including any insurance obtained to secure its 
obligations under the Act, and its relationship with other potentially 
liable operators. A copy of any notification issued pursuant to this 
section shall be sent to the claimant by regular mail.
    (d) If at any time before a case is referred to the Office of 
Administrative Law Judges, the district director determines that an 
operator which may be liable for the payment of benefits has not been 
notified under this section or has been incorrectly dismissed pursuant 
to Sec. 725.413(c)(1), the district director shall give such operator 
notice of its potential liability in accordance with this section. The 
adjudication officer shall then take such further action on the claim 
as may be appropriate. There shall be no time limit applicable to a 
later identification of an operator under this paragraph if the 
operator fraudulently concealed its identity as an employer of the 
miner.


Sec. 725.408  Operator's response to notification.

    (a)(1) An operator which receives notification under Sec. 725.407 
shall, within 30 days of receipt, file a response, and shall indicate 
its intent to accept or contest its identification as a potentially 
liable operator. The operator's response shall also be sent to the 
claimant by regular mail.
    (2) If the operator contests its identification, it shall, on a 
form supplied by the district director, state the precise nature of its 
disagreement by admitting or denying each of the following assertions. 
In answering these assertions, the term ``operator'' shall include any 
operator for which the identified operator may be considered a 
successor operator pursuant to Sec. 725.492.
    (i) That the named operator was an operator for any period after 
June 30, 1973;
    (ii) That the operator employed the miner as a miner for a 
cumulative period of not less than one year;
    (iii) That the miner was exposed to coal mine dust while working 
for the operator;
    (iv) That the miner's employment with the operator included at 
least one working day after December 31, 1969; and
    (v) That the operator is capable of assuming liability for the 
payment of benefits.
    (3) An operator which receives notification under Sec. 725.407, and 
which fails to file a response within the time limit provided by this 
section, shall not be allowed to contest its liability for the payment 
of benefits on the grounds set forth in paragraph (a)(2).
    (b)(1) Within 60 days of the date on which it receives notification 
under Sec. 725.407, an operator may submit documentary evidence in 
support of its position.
    (2) No documentary evidence relevant to the grounds set forth in 
paragraph (a)(2) may be admitted in any further proceedings unless it 
is submitted within the time limits set forth in this section.


Sec. 725.409  Denial of a claim by reason of abandonment.

    (a) A claim may be denied at any time by the district director by 
reason of abandonment where the claimant fails:
    (1) To undergo a required medical examination without good cause; 
or,

[[Page 3402]]

    (2) To submit evidence sufficient to make a determination of the 
claim; or,
    (3) To pursue the claim with reasonable diligence; or,
    (4) To attend an informal conference without good cause.
    (b) If the district director determines that a denial by reason of 
abandonment is appropriate, he or she shall notify the claimant of the 
reasons for such denial and of the action which must be taken to avoid 
a denial by reason of abandonment. If the claimant completes the action 
requested within the time allowed, the claim shall be developed, 
processed and adjudicated as specified in this part. If the claimant 
does not fully comply with the action requested by the district 
director, the district director shall notify the claimant that the 
claim has been denied by reason of abandonment. Any request for a 
hearing prior to the issuance of such notification shall be considered 
invalid and of no effect. Such notification shall be served on the 
claimant and all other parties to the claim by certified mail. The 
denial shall become effective and final unless, within 30 days after 
the denial is issued, the claimant requests a hearing. If the claimant 
timely requests a hearing, the district director shall refer the case 
to the Office of Administrative Law Judges in accordance with 
Sec. 725.421. The hearing will be limited to the issue of whether the 
claim was properly denied by reason of abandonment. Following the 
expiration of the 30-day period, a new claim may be filed at any time 
pursuant to Sec. 725.309.


Sec. 725.410  Initial findings by the district director.

    (a) Based upon the evidence developed, the district director shall 
make an initial finding with respect to the claim. The initial finding 
shall include a determination with respect to the claimant's 
eligibility and a determination with respect to whether any of the 
operators notified of potential liability under Sec. 725.407 of this 
part is the responsible operator in accordance with Sec. 725.495 of 
this part.
    (b) The district director shall serve the initial finding, together 
with a copy of all of the evidence developed, on the claimant, the 
responsible operator, and all other operators which received 
notification pursuant to Sec. 725.407 of this part. The initial finding 
shall be served on each party by certified mail.
    (c) If the evidence submitted does not support a finding of 
eligibility, the initial finding shall specify the reasons why the 
claim cannot be approved and the additional evidence necessary to 
establish entitlement. The initial finding shall notify the claimant 
that he has the right to obtain further adjudication of his eligibility 
in accordance with this subpart, that he has the right to submit 
additional evidence in accordance with this subpart, and that he has 
the right to obtain counsel, under the terms set forth in subpart D, in 
order to assist him. The initial finding shall further notify the 
claimant that, if he establishes his entitlement to benefits, the cost 
of obtaining additional evidence, along with a reasonable attorney's 
fee, shall be reimbursed by the responsible operator, or, if no 
operator can be held liable, the fund.


Sec. 725.411  Initial finding--eligibility.

    (a) Claimant response--(1) Finding that the claimant is not 
eligible for benefits. (i) Within one year after the district director 
issues an initial finding that the claimant is not eligible for 
benefits, the claimant may request further adjudication of the claim. 
Any statement filed during the applicable time period demonstrating the 
claimant's intention to pursue his or her claim shall be considered a 
request for further adjudication in accordance with this section. The 
claimant may not request a hearing at this point. Any request for a 
hearing prior to the issuance of a proposed decision and order shall be 
considered invalid and of no effect.
    (ii) If the claimant does not request further adjudication of the 
claim within the time limits set forth in this section, the claim shall 
be deemed to have been denied, effective as of the date of the issuance 
of the initial finding. Any submission by the claimant after the time 
limits set forth in this section will be treated as an intent to file a 
new claim for benefits in accordance with Sec. 725.305. Such a claim 
may be approved only if it meets the conditions of Sec. 725.309.
    (2) Finding that the claimant is eligible for benefits. If the 
district director issues an initial finding that the evidence submitted 
supports a finding of eligibility, the claimant may, within 30 days of 
the issuance of the initial finding, request revision of any of the 
terms of the initial finding. If the claimant does not file a timely 
request pursuant to this paragraph, he shall be deemed to have accepted 
the district director's initial finding.
    (b) Operator response. (1) Within 30 days of the issuance of an 
initial finding, the responsible operator initially found liable for 
the payment of benefits shall file a response with regard to the 
claimant's eligibility for benefits. The response shall specifically 
indicate whether the operator agrees or disagrees with the initial 
finding of eligibility. A response that the operator is not liable for 
benefits shall not be sufficient to contest the claimant's eligibility 
under this section. A response to the initial finding of eligibility 
shall be filed regardless of whether the district director finds the 
claimant eligible for benefits.
    (2) If the operator initially found liable for the payment of 
benefits does not file a timely response, it shall be deemed to have 
accepted the district director's initial finding with respect to the 
claimant's eligibility, and shall not, except as provided in 
Sec. 725.463, be permitted to raise issues or present evidence with 
respect to issues inconsistent with the initial findings in any further 
proceeding conducted with respect to the claim.


Sec. 725.412  Initial finding-liability.

    (a) Within 30 days of the issuance of an initial finding, the 
responsible operator initially found liable for the payment of benefits 
shall file a response with regard to its liability for benefits. The 
response shall specifically indicate whether the operator agrees or 
disagrees with the initial finding of liability. A response that the 
operator is not liable for benefits under this section shall not be 
sufficient to contest the claimant's eligibility. A response to the 
initial finding of liability shall be filed regardless of whether or 
not the district director finds the claimant eligible for benefits.
    (b) If the responsible operator initially found liable for the 
payment of benefits does not file a timely response, it shall be deemed 
to have accepted the district director's initial finding with respect 
to its liability, and to have waived its right to contest its liability 
in any further proceeding conducted with respect to the claim.


Sec. 725.413  Initial adjudication by the district director.

    (a) If the district director issues an initial finding that the 
evidence submitted supports a finding of eligibility, and
    (1) The responsible operator does not file a timely response under 
either Sec. 725.411 or Sec. 725.412, or
    (2) There is no operator responsible for the payment of benefits, 
the district director shall, after considering any request filed by the 
claimant pursuant to Sec. 725.411(a)(2), issue a proposed decision and 
order in accordance with Sec. 725.418.
    (b) If the district director issues an initial finding that the 
evidence submitted does not support a finding of eligibility, and the 
claimant does not file a timely response pursuant to Sec. 725.411,

[[Page 3403]]

the claim shall be considered to have been denied, effective as of the 
date of the issuance of the initial finding. Any later submission by 
the claimant will be treated as an intent to file a claim for benefits 
in accordance with Sec. 725.305. Such a claim may be approved only if 
it meets the conditions of Sec. 725.309.
    (c)(1) In all other cases, the district director shall, following 
the expiration of all applicable time periods for filing responses, or 
the receipt of responses, notify all parties of any responses received 
from the claimant and the responsible operator. The district director 
may, in his discretion, dismiss as parties any of the operators 
notified of their potential liability pursuant to Sec. 725.407. If the 
district director thereafter determines that the participation of a 
party dismissed pursuant to this section is required, he may once again 
notify the operator in accordance with Sec. 725.407(d).
    (2) The district director shall notify the parties of a schedule 
for submitting documentary evidence. Such schedule shall allow the 
parties not less than 60 days within which to submit evidence in 
support of their contentions, and shall provide not less than an 
additional 30 days within which the parties may respond to evidence 
submitted by other parties. Any such evidence must meet the 
requirements set forth in Sec. 725.414 in order to be admitted into the 
record.


Sec. 725.414  Development of evidence.

    (a) Medical evidence--(1)(i) Pulmonary evaluation. For purposes of 
this section, a pulmonary evaluation shall consist of one chest 
roentgenogram, one pulmonary function study, one report of physical 
examination, and the results of such other testing, including arterial 
blood gas testing, as the physician who prepares the report of physical 
examination deems necessary to fully evaluate the claimant's 
respiratory and pulmonary condition. The tests need not be performed at 
the same facility, nor be administered or supervised by the same 
physician.
    (ii) Consultative report. For purposes of this section, a 
consultative report shall consist of the opinion of a physician based 
on a review of any medical evidence relevant to the miner's respiratory 
or pulmonary condition.
    (2) The claimant shall be entitled to submit the results of up to 
two pulmonary evaluations or consultative reports. If the claimant 
selected the physician who prepared the report of physical examination 
pursuant to Sec. 725.406 of this part, the complete pulmonary 
evaluation obtained pursuant to that section shall be considered one of 
the two evaluations or reports that the claimant may submit.
    (3) The Department intends that all parties to a claim, including 
all operators notified of their potential liability under Sec. 725.407 
that have not been dismissed, shall be bound by a final adjudication of 
the claimant's eligibility. Accordingly, any operator notified of its 
potential liability in accordance with Sec. 725.407 shall not be 
entitled to require the claimant to re-adjudicate his eligibility in 
the event the district director's initial finding with respect to the 
responsible operator is determined to have been erroneous.
    (i) The responsible operator and any other operators that remain 
parties to the case shall collectively be entitled to obtain and submit 
the results of no more than two pulmonary evaluations or consultative 
reports. In obtaining such evaluations, no miner shall be required to 
travel more than 100 miles from his or her place of residence for the 
purpose of submitting to a pulmonary evaluation requested by an 
operator, unless a trip of greater distance is authorized in writing by 
the district director. If a miner unreasonably refuses--
    (A) To provide the Office or a coal mine operator with a complete 
statement of his or her medical history and/or to authorize access to 
his or her medical records, or
    (B) To submit to an evaluation or test requested by the district 
director or a potentially liable operator, the miner's claim may be 
denied by reason of abandonment (See Sec. 725.409 of this part).
    (ii) In a case in which the district director has not identified 
any potentially liable operators, the district director shall be 
entitled to exercise the rights of a responsible operator under this 
section, except that in any case where the complete pulmonary 
evaluation performed pursuant to Sec. 725.406 was performed by a 
physician selected by the district director, the evaluation shall be 
admitted into evidence, and shall be considered one of the two 
evaluations or reports that the district director may submit.
    (iii) Except for the responsible operator, any operator notified of 
its potential liability pursuant to Sec. 725.407, and which has not 
been dismissed as a party by the district director, must request 
permission of the district director to obtain an independent pulmonary 
evaluation of the miner, or to submit a consultative report. Such 
permission shall be granted only upon a showing that the responsible 
operator has not undertaken a full development of the evidence, and 
that without such permission, the potentially liable operator will be 
unable to secure a full and fair litigation of the claimant's 
eligibility. In granting such permission, the district director may 
take such action as is necessary to prevent the miner from undergoing 
unnecessary testing, and shall ensure that the record contains no more 
than two pulmonary evaluations or consultative reports submitted by the 
parties opposing the claimant's eligibility.
    (4) Notwithstanding the limitations in paragraph (a)(3) of this 
section, any record of a miner's hospitalization for a pulmonary or 
related disease, medical treatment for a pulmonary or related disease, 
or a biopsy or autopsy may be received into evidence.
    (5) A copy of any documentary evidence submitted by a party must be 
served on all other parties to the claim. If the claimant is not 
represented by an attorney, the district director shall mail a copy of 
all documentary evidence submitted by the claimant to all other parties 
to the claim. Following the development and submission of affirmative 
medical evidence, the parties may submit rebuttal evidence in 
accordance with the schedule issued by the district director. Such 
rebuttal evidence shall include no more than one interpretive opinion 
with respect to the results of each component of the pulmonary 
evaluations submitted by the opposing party, and may not include a 
third pulmonary evaluation of the miner.
    (6) The district director shall admit into the record all evidence 
submitted in accordance with this section, and shall also admit the 
results of any medical evaluation or review conducted by a physician 
selected by the district director pursuant to Sec. 725.406.
    (b) Evidence pertaining to liability.  (1) Except as provided by 
Sec. 725.408(b)(2), the potential responsible operator may submit 
evidence to demonstrate that it is not the potentially liable operator 
that most recently employed the claimant. Failure to submit such 
evidence shall be deemed an acceptance of the district director's 
initial finding of liability.
    (2) Any other party may submit evidence regarding the liability of 
the potential responsible operator or any other operator.
    (3) A copy of any documentary evidence submitted under this 
paragraph must be mailed to all other parties to the claim. Following 
the submission of affirmative evidence, the parties may submit rebuttal 
evidence in accordance with the schedule issued by the district 
director.
    (c) Testimony. The claimant, and any person who prepared 
documentary evidence submitted pursuant to this

[[Page 3404]]

section, may testify at any formal hearing conducted in accordance with 
subpart F of this part with respect to the claim. In accordance with 
the schedule issued by the district director, all parties shall notify 
the district director of the name and current address of any other 
witness that the party intends to call at such hearing. No testimony by 
any witness who is not identified as a witness in accordance with this 
section shall be admitted in any hearing conducted with respect to the 
claim.
    (d) Except to the extent permitted by Sec. 725.456, no documentary 
evidence shall be admitted in any further proceeding conducted with 
respect to a claim unless it is submitted to the district director in 
accordance with this section.


Sec. 725.415  Action by the district director after development of 
operator's evidence.

    (a) At the end of the period permitted under Sec. 725.413(c)(2) for 
the submission of evidence, the district director shall review the 
claim on the basis of all evidence submitted in accordance with 
Sec. 725.414.
    (b) After review of all evidence submitted, the district director 
may schedule a conference in accordance with Sec. 725.416, issue a 
proposed decision and order in accordance with Sec. 725.418, or take 
such other action as the district director considers appropriate.


Sec. 725.416  Conferences.

    (a) At the conclusion of the period permitted by Sec. 725.413(c)(2) 
for the submission of evidence, the district director may conduct an 
informal conference in any claim where it appears that such conference 
will assist in the voluntary resolution of any issue raised with 
respect to the claim. The conference proceedings shall not be 
stenographically reported and sworn testimony shall not be taken.
    (b) The district director shall notify the parties of a definite 
time and place for the conference and may in his or her discretion, or 
on the motion of any party, cancel or reschedule a conference.
    (c) The unexcused failure of any party to appear at an informal 
conference shall be grounds for the imposition of sanctions. If the 
claimant fails to appear, the district director may take such steps as 
are authorized by Sec. 725.409 to deny the claim by reason of 
abandonment. If the responsible operator fails to appear, it shall be 
deemed to have waived its right to contest its potential liability for 
an award of benefits and, in the discretion of the district director, 
its right to contest any issue related to the claimant's eligibility.
    (d) Any representative of an operator, of an operator's insurance 
carrier, or of a claimant, authorized to represent such party in 
accordance with Sec. 725.362, shall be deemed to have sufficient 
authority to stipulate facts or issues or agree to a final disposition 
of the claim.
    (e) Procedures to be followed at a conference shall be within the 
discretion of the district director. In the case of a conference 
involving an unrepresented claimant, the district director shall fully 
inform the claimant of the consequences of any agreement the claimant 
is asked to sign. If it is apparent that the unrepresented claimant 
does not understand the nature or effect of the proceedings, the 
district director shall not permit the execution of any stipulation or 
agreement in the claim unless it is clear that the best interests of 
the claimant are served thereby.


Sec. 725.417  Action at the conclusion of conference.

    (a) At the conclusion of a conference, the district director shall 
prepare a stipulation of contested and uncontested issues which shall 
be signed by the parties and the district director. If a hearing is 
conducted with respect to the claim, this stipulation shall be 
submitted to the Office of Administrative Law Judges and placed in the 
claim record.
    (b) In any case, where appropriate, the district director may 
permit a reasonable time for the submission of additional evidence 
following a conference, provided that such evidence does not exceed the 
limits set forth in Sec. 725.414.
    (c) Within 20 days after the termination of all conference 
proceedings, the district director shall prepare and send to the 
parties by certified mail a memorandum of conference, on a form 
prescribed by the Office, summarizing the conference and including the 
following:
    (1) Date, time and place of conference;
    (2) Names, addresses, telephone numbers, and status (i.e., 
claimant, attorney, operator, carrier's representative, etc.);
    (3) Issues discussed at conference;
    (4) Additional material presented (i.e., medical reports, 
employment reports, marriage certificates, birth certificates, etc.);
    (5) Issues resolved at conference; and
    (6) District director's recommendation.
    (d) Each party shall, in writing, either accept or reject, in whole 
or in part, the district director's recommendation, stating the reasons 
for such rejection. If no reply is received within 30 days from the 
date on which the recommendation was sent to parties, the 
recommendation shall be deemed accepted.


Sec. 725.418  Proposed decision and order.

    (a) After evaluating the parties' responses to the district 
director's recommendation pursuant to Sec. 725.417, or, if no informal 
conference is to be held, at the conclusion of the period permitted by 
Sec. 725.413(c)(2) for the submission of evidence, the district 
director shall issue a proposed decision and order. A proposed decision 
and order is a document, issued by the district director after the 
evidentiary development of the claim is completed and all contested 
issues, if any, are joined, which purports to resolve a claim on the 
basis of the evidence submitted to or obtained by the district 
director. A proposed decision and order shall be considered a final 
adjudication of a claim only as provided in Sec. 725.419. A proposed 
decision and order may be issued by the district director in any claim 
and at any time during the adjudication of a claim if:
    (1) Issuance is authorized or required by this part; or,
    (2) The district director determines that its issuance will 
expedite the adjudication of the claim.
    (b) A proposed decision and order shall contain findings of fact 
and conclusions of law and an appropriate order shall be served on all 
parties to the claim by certified mail.


Sec. 725.419  Response to proposed decision and order.

    (a) Within 30 days after the date of issuance of a proposed 
decision and order, any party may, in writing, request a revision of 
the proposed decision and order or a hearing. If a hearing is 
requested, the district director shall refer the claim to the Office of 
Administrative Law Judges (see Sec. 725.421).
    (b) Any response made by a party to a proposed decision and order 
shall specify the findings and conclusions with which the responding 
party disagrees, and shall be served on the district director and all 
other parties to the claim.
    (c) If a timely request for revision of a proposed decision and 
order is made, the district director may amend the proposed decision 
and order, as circumstances require, and serve the revised proposed 
decision and order on all parties or take such other action as is 
appropriate. If a revised proposed decision and order is issued, each 
party to the claim shall have 30 days from the date of issuance of that 
revised

[[Page 3405]]

proposed decision and order within which to request a hearing.
    (d) If no response to a proposed decision and order is sent to the 
district director within the period described in paragraph (a) of this 
section, or if no response to a revised proposed decision and order is 
sent to the district director within the period described in paragraph 
(c) of this section, the proposed decision and order shall become a 
final decision and order, which is effective upon the expiration of the 
applicable 30-day period. Once a proposed decision and order or revised 
proposed decision and order becomes final and effective, all rights to 
further proceedings with respect to the claim shall be considered 
waived, except as provided in Sec. 725.310.


Sec. 725.420  Initial determinations.

    (a) Section 9501(d)(1)(A)(1) of the Internal Revenue Code provides 
that the Black Lung Disability Trust Fund shall begin the payment of 
benefits on behalf of an operator in any case in which the operator 
liable for such payments has not commenced payment of such benefits 
within 30 days after the date of an initial determination of 
eligibility by the Secretary. For claims filed on or after January 1, 
1982, the payment of such interim benefits from the fund is limited to 
benefits accruing after the date of such initial determination.
    (b) Except as provided in Sec. 725.415 of this subpart, after the 
district director has determined that a claimant is eligible for 
benefits, on the basis of all evidence submitted by a claimant and 
operator, and has determined that a hearing will be necessary to 
resolve the claim, the district director shall in writing so inform the 
parties and direct the operator to begin the payment of benefits to the 
claimant in accordance with Sec. 725.522. The date on which this 
writing is sent to the parties shall be considered the date of initial 
determination of the claim.
    (c) If a notified operator refuses to commence payment of a claim 
within 30 days from the date on which an initial determination is made 
under this section, benefits shall be paid by the fund to the claimant 
in accordance with Sec. 725.522, and the operator shall be liable to 
the fund, if such operator is determined liable for the claim, for all 
benefits paid by the fund on behalf of such operator, and, in addition, 
such penalties and interest as are appropriate.


Sec. 725.421  Referral of a claim to the Office of Administrative Law 
Judges.

    (a) In any claim for which a formal hearing is requested or 
ordered, and with respect to which the district director has completed 
development and adjudication without having resolved all contested 
issues in the claim, the district director shall refer the claim to the 
Office of Administrative Law Judges for a hearing.
    (b) In any case referred to the Office of Administrative Law Judges 
under this section, the district director shall transmit to that office 
the following documents, which shall be placed in the record at the 
hearing subject to the objection of any party:
    (1) Copies of the claim form or forms;
    (2) Any statement, document, or pleading submitted by a party to 
the claim;
    (3) A copy of the notification to an operator of its possible 
liability for the claim;
    (4) All evidence submitted to the district director under this 
part;
    (5) Any written stipulation of law or fact or stipulation of 
contested and uncontested issues entered into by the parties;
    (6) Any pertinent forms submitted to the district director;
    (7) The statement by the district director of contested and 
uncontested issues in the claim; and
    (8) The district director's initial determination of eligibility or 
other documents necessary to establish the right of the fund to 
reimbursement, if appropriate. Copies of the transmittal notice shall 
also be sent to all parties to the claim by regular mail.
    (c) A party may at any time request and obtain from the district 
director copies of documents transmitted to the Office of 
Administrative Law Judges under paragraph (b) of this section. If the 
party has previously been provided with such documents, additional 
copies may be sent to the party upon the payment of a copying fee to be 
determined by the district director.


Sec. 725.422  Legal assistance.

    The Secretary or his or her designee may, upon request, provide a 
claimant with legal assistance in processing a claim under the Act. 
Such assistance may be made available to a claimant in the discretion 
of the Solicitor of Labor or his or her designee at any time prior to 
or during the time in which the claim is being adjudicated and shall be 
furnished without charge to the claimant. Representation of a claimant 
in adjudicatory proceedings shall not be provided by the Department of 
Labor unless it is determined by the Solicitor of Labor that such 
representation is in the best interests of the black lung benefits 
program. In no event shall representation be provided to a claimant in 
a claim with respect to which the claimant's interests are adverse to 
those of the Secretary of Labor or the fund.


Sec. 725.423  Extensions of time.

    Except for the one-year time limit set forth in 
Sec. 725.411(a)(1)(i) and the 30-day time limit set forth in 
Sec. 725.419, any of the time periods set forth in this subpart may be 
extended, for good cause shown, by filing a request for an extension 
with the district director prior to the expiration of the time period.

Subpart F--Hearings


Sec. 725.450  Right to a hearing.

    Any party to a claim (see Sec. 725.360) shall have a right to a 
hearing concerning any contested issue of fact or law unresolved by the 
district director. There shall be no right to a hearing until the 
processing and adjudication of the claim by the district director has 
been completed. There shall be no right to a hearing in a claim with 
respect to which a determination of the claim made by the district 
director has become final and effective in accordance with this part.


Sec. 725.451  Request for hearing.

    After the completion of proceedings before the district director, 
or as is otherwise indicated in this part, any party may in writing 
request a hearing on any contested issue of fact or law (see 
Sec. 725.419). A district director may on his or her own initiative 
refer a case for hearing. If a hearing is requested, or if a district 
director determines that a hearing is necessary to the resolution of 
any issue, the claim shall be referred to the Chief Administrative Law 
Judge for a hearing under Sec. 725.421.


Sec. 725.452  Type of hearing; parties.

    (a) A hearing held under this part shall be conducted by an 
administrative law judge designated by the Chief Administrative Law 
Judge. Except as otherwise provided by this part, all hearings shall be 
conducted in accordance with the provisions of 5 U.S.C. 554 et seq.
    (b) All parties to a claim shall be permitted to participate fully 
at a hearing held in connection with such claim.
    (c) A full evidentiary hearing need not be conducted if a party 
moves for summary judgment and the administrative law judge determines 
that there is no genuine issue as to any material fact and that the 
moving party is entitled to the relief requested as a matter of law. 
All parties shall be entitled to respond to the motion for summary 
judgment prior to decision thereon.

[[Page 3406]]

    (d) If the administrative law judge believes that an oral hearing 
is not necessary (for any reason other than on motion for summary 
judgment), the judge shall notify the parties by written order and 
allow at least 30 days for the parties to respond. The administrative 
law judge shall hold the oral hearing if any party makes a timely 
request in response to the order.


Sec. 725.453  Notice of hearing.

    All parties shall be given at least 30 days written notice of the 
date and place of a hearing and the issues to be resolved at the 
hearing. Such notice shall be sent to each party or representative by 
certified mail.


Sec. 725.454  Time and place of hearing; transfer of cases.

    (a) The Chief Administrative Law Judge shall assign a definite time 
and place for a formal hearing, and shall, where possible, schedule the 
hearing to be held at a place within 75 miles of the claimant's 
residence unless an alternate location is requested by the claimant.
    (b) If the claimant's residence is not in any State, the Chief 
Administrative Law Judge may, in his or her discretion, schedule the 
hearing in the country of the claimant's residence.
    (c) The Chief Administrative Law Judge or the administrative law 
judge assigned the case may in his or her discretion direct that a 
hearing with respect to a claim shall begin at one location and then 
later be reconvened at another date and place.
    (d) The Chief Administrative Law Judge or administrative law judge 
assigned the case may change the time and place for a hearing, either 
on his or her own motion or for good cause shown by a party. The 
administrative law judge may adjourn or postpone the hearing for good 
cause shown, at any time prior to the mailing to the parties of the 
decision in the case. Unless otherwise agreed, at least 10 days notice 
shall be given to the parties of any change in the time or place of 
hearing.
    (e) The Chief Administrative Law Judge may for good cause shown 
transfer a case from one administrative law judge to another.


Sec. 725.455  Hearing procedures; generally.

    (a) General. The purpose of any hearing conducted under this 
subpart shall be to resolve contested issues of fact or law. Except as 
provided in Sec. 725.421(b)(8), any findings or determinations made 
with respect to a claim by a district director shall not be considered 
by the administrative law judge.
    (b) Evidence. The administrative law judge shall at the hearing 
inquire fully into all matters at issue, and shall not be bound by 
common law or statutory rules of evidence, or by technical or formal 
rules of procedure, except as provided by 5 U.S.C. 554 and this 
subpart. The administrative law judge shall receive into evidence the 
testimony of the witnesses and parties, the evidence submitted to the 
Office of Administrative Law Judges by the district director under 
Sec. 725.421, and such additional evidence as may be submitted in 
accordance with the provisions of this subpart. The administrative law 
judge may entertain the objections of any party to the evidence 
submitted under this section.
    (c) Procedure. The conduct of the hearing and the order in which 
allegations and evidence shall be presented shall be within the 
discretion of the administrative law judge and shall afford the parties 
an opportunity for a fair hearing.
    (d) Oral argument and written allegations. The parties, upon 
request, may be allowed a reasonable time for the presentation of oral 
argument at the hearing. Briefs or other written statements or 
allegations as to facts or law may be filed by any party with the 
permission of the administrative law judge. Copies of any brief or 
other written statement shall be filed with the administrative law 
judge and served on all parties by the submitting party.


Sec. 725.456  Introduction of documentary evidence.

    (a) All documents transmitted to the Office of Administrative Law 
Judges under Sec. 725.421 shall be placed into evidence by the 
administrative law judge, subject to objection by any party.
    (b) Documentary evidence which is obtained by any party either 
after the district director forwards the claim to the Office of 
Administrative Law Judges or in excess of the limitations contained in 
Sec. 725.414 shall not be admitted into the hearing record in the 
absence of extraordinary circumstances (see Sec. 725.414(d)).
    (c) Subject to paragraph (b) of this section, documentary evidence 
which the district director excludes from the record, and the 
objections to such evidence, may be submitted by the parties to the 
administrative law judge, who shall independently determine whether the 
evidence shall be admitted.
    (1) If the evidence is admitted, the administrative law judge may, 
in his or her discretion, remand the claim to the district director for 
further consideration.
    (2) If the evidence is admitted, the administrative law judge shall 
afford the opposing party or parties the opportunity to develop such 
additional documentary evidence as is necessary to protect the right of 
cross-examination.
    (d) All medical records and reports submitted by any party shall be 
considered by the administrative law judge in accordance with the 
quality standards contained in part 718 of this subchapter.
    (e) If the administrative law judge concludes that the complete 
pulmonary evaluation provided pursuant to Sec. 725.406, or any part 
thereof, fails to comply with the applicable quality standards, or 
fails to address the relevant conditions of entitlement (see 
Sec. 725.202(d)(2) (i) through (iv)) in a manner which permits 
resolution of the claim, and such evaluation or part thereof was 
performed by a physician or facility selected by the Office, the 
administrative law judge shall, in his or her discretion, remand the 
claim to the district director with instructions to develop only such 
additional evidence as is required, or allow the parties a reasonable 
time to obtain and submit such evidence, before the termination of the 
hearing.


Sec. 725.457  Witnesses.

    (a) Witnesses at the hearing shall testify under oath or 
affirmation. The administrative law judge and the parties may question 
witnesses with respect to any matters relevant and material to any 
contested issue. Any party who intends to present the testimony of an 
expert witness at a hearing shall so notify all other parties to the 
claim at least 10 days before the hearing. The failure to give notice 
of the appearance of an expert witness in accordance with this 
paragraph, unless notice is waived by all parties, shall preclude the 
presentation of testimony by such expert witness.
    (b) No person shall be required to appear as a witness in any 
proceeding before an administrative law judge at a place more than 100 
miles from his or her place of residence, unless the lawful mileage and 
witness fee for 1 day's attendance is paid in advance of the hearing 
date.
    (c) No person shall be permitted to testify as a witness at the 
hearing unless that person:
    (1) Prepared documentary evidence which was submitted to the 
district director pursuant to Sec. 725.414 (a) or (b), or
    (2) Was identified as a potential hearing witness while the claim 
was pending before the district director in accordance with 
Sec. 725.414(c), or
    (3) Prepared documentary evidence which was admitted by the

[[Page 3407]]

administrative law judge pursuant to Sec. 725.456.
    (d) Notwithstanding paragraph (c)(2) of this section, no physician 
shall be permitted to testify as a witness at the hearing unless he has 
prepared a medical report which is entered into evidence. A physician 
shall be permitted to testify only with respect to the contents of the 
report or reports he has prepared.


Sec. 725.458  Depositions; interrogatories.

    The testimony of any witness or party may be taken by deposition or 
interrogatory according to the rules of practice of the Federal 
district court for the judicial district in which the case is pending 
(or of the U.S. District Court for the District of Columbia if the case 
is pending in the District or outside the United States), except that 
at least 30 days prior notice of any deposition shall be given to all 
parties unless such notice is waived. No post-hearing deposition or 
interrogatory shall be permitted unless authorized by the 
administrative law judge upon the motion of a party to the claim. The 
testimony of any physician which is taken by deposition shall be 
subject to the limitations on the scope of the testimony contained in 
Sec. 725.457(d).


Sec. 725.459  Witness fees.

    (a) A witness testifying at a hearing before an administrative law 
judge, or whose deposition is taken, shall receive the same fees and 
mileage as witnesses in courts of the United States. If the witness is 
an expert, he or she shall be entitled to an expert witness fee. Except 
as provided in paragraphs (b) and (c) of this section, such fees shall 
be paid by the proponent of the witness.
    (b) If the witness' proponent does not intend to call the witness 
to appear at hearing or deposition, any other party may subpoena the 
witness for cross-examination. If such witness is required to attend 
the hearing, give a deposition or respond to interrogatories for cross-
examination purposes, the subpoenaing party shall pay the witness' fee. 
If the witness' proponent does call the witness to testify as part of 
its case, then cross-examination of that witness by any other party 
will not shift liability for fees and costs from the proponent to the 
other party or parties.
    (c) If a claimant is determined entitled to benefits, there may be 
assessed as costs against a responsible operator, if any, or the fund, 
fees and mileage for necessary witnesses attending the hearing at the 
request of the claimant. Both the necessity for the witness and the 
reasonableness of the fees of any expert witness shall be approved by 
the administrative law judge. The amounts awarded against a responsible 
operator or the fund as attorney's fees, or costs, fees and mileage for 
witnesses, shall not in any respect affect or diminish benefits payable 
under the Act.


Sec. 725.460  Consolidated hearings.

    When two or more hearings are to be held, and the same or 
substantially similar evidence is relevant and material to the matters 
at issue at each such hearing, the Chief Administrative Law Judge may, 
upon motion by any party or on his or her own motion, order that a 
consolidated hearing be conducted. Where consolidated hearings are 
held, a single record of the proceedings shall be made and the evidence 
introduced in one claim may be considered as introduced in the others, 
and a separate or joint decision shall be made, as appropriate.


Sec. 725.461   Waiver of right to appear and present evidence.

    (a) If all parties waive their right to appear before the 
administrative law judge, it shall not be necessary for the 
administrative law judge to give notice of, or conduct, an oral 
hearing. A waiver of the right to appear shall be made in writing and 
filed with the Chief Administrative Law Judge or the administrative law 
judge assigned to hear the case. Such waiver may be withdrawn by a 
party for good cause shown at any time prior to the mailing of the 
decision in the claim. Even though all of the parties have filed a 
waiver of the right to appear, the administrative law judge may, 
nevertheless, after giving notice of the time and place, conduct a 
hearing if he or she believes that the personal appearance and 
testimony of the party or parties would assist in ascertaining the 
facts in issue in the claim. Where a waiver has been filed by all 
parties, and they do not appear before the administrative law judge 
personally or by representative, the administrative law judge shall 
make a record of the relevant documentary evidence submitted in 
accordance with this part and any further written stipulations of the 
parties. Such documents and stipulations shall be considered the 
evidence of record in the case and the decision shall be based upon 
such evidence.
    (b) Except as provided in Sec. 725.456(a), the unexcused failure of 
any party to attend a hearing shall constitute a waiver of such party's 
right to present evidence at the hearing, and may result in a dismissal 
of the claim (see Sec. 725.465).


Sec. 725.462   Withdrawal of controversion of issues set for formal 
hearing; effect.

    A party may, on the record, withdraw his or her controversion of 
any or all issues set for hearing. If a party withdraws his or her 
controversion of all issues, the administrative law judge shall remand 
the case to the district director for the issuance of an appropriate 
order.


Sec. 725.463   Issues to be resolved at hearing; new issues.

    (a) Except as otherwise provided in this section, the hearing shall 
be confined to those contested issues which have been identified by the 
district director (see Sec. 725.421) or any other issue raised in 
writing before the district director.
    (b) An administrative law judge may consider a new issue only if 
such issue was not reasonably ascertainable by the parties at the time 
the claim was before the district director. Such new issue may be 
raised upon application of any party, or upon an administrative law 
judge's own motion, with notice to all parties, at any time after a 
claim has been transmitted by the district director to the Office of 
Administrative Law Judges and prior to decision by an administrative 
law judge. If a new issue is raised, the administrative law judge may, 
in his or her discretion, either remand the case to the district 
director with instructions for further proceedings, hear and resolve 
the new issue, or refuse to consider such new issue.
    (c) If a new issue is to be considered by the administrative law 
judge, a party may, upon request, be granted an appropriate 
continuance.


Sec. 725.464   Record of hearing.

    All hearings shall be open to the public and shall be mechanically 
or stenographically reported. All evidence upon which the 
administrative law judge relies for decision shall be contained in the 
transcript of testimony, either directly or by appropriate reference. 
All medical reports, exhibits, and any other pertinent document or 
record, either in whole or in material part, introduced as evidence, 
shall be marked for identification and incorporated into the record.


Sec. 725.465   Dismissals for cause.

    (a) The administrative law judge may, at the request of any party, 
or on his or her own motion, dismiss a claim:
    (1) Upon the failure of the claimant or his or her representative 
to attend a hearing without good cause;
    (2) Upon the failure of the claimant to comply with a lawful order 
of the administrative law judge; or

[[Page 3408]]

    (3) Where there has been a prior final adjudication of the claim or 
defense to the claim under the provisions of this subchapter and no new 
evidence is submitted (except as provided in part 727 of this 
subchapter; see Sec. 725.4(d)).
    (b) A party who is not a proper party to the claim (see 
Sec. 725.360) shall be dismissed by the administrative law judge.
    (c) In any case where a dismissal of a claim, defense, or party is 
sought, the administrative law judge shall issue an order to show cause 
why the dismissal should not be granted and afford all parties a 
reasonable time to respond to such order. After the time for response 
has expired, the administrative law judge shall take such action as is 
appropriate to rule on the dismissal, which may include an order 
dismissing the claim, defense or party.
    (d) No claim shall be dismissed in a case with respect to which 
payments prior to final adjudication have been made to the claimant in 
accordance with Sec. 725.522, except upon the motion or written 
agreement of the Director.


Sec. 725.466   Order of dismissal.

    (a) An order dismissing a claim shall be served on the parties in 
accordance with Sec. 725.478. The dismissal of a claim shall have the 
same effect as a decision and order disposing of the claim on its 
merits, except as provided in paragraph (b) of this section. Such order 
shall advise the parties of their right to request review by the 
Benefits Review Board.
    (b) Where the Chief Administrative Law Judge or the presiding 
administrative law judge issues a decision and order dismissing the 
claim after a show cause proceeding, the district director shall 
terminate any payments being made to the claimant under Sec. 725.522, 
and the order of dismissal shall, if appropriate, order the claimant to 
reimburse the fund for all benefits paid to the claimant.


Sec. 725.475   Termination of hearings.

    Hearings are officially terminated when all the evidence has been 
received, witnesses heard, pleadings and briefs submitted to the 
administrative law judge, and the transcript of the proceedings has 
been printed and delivered to the administrative law judge.


Sec. 725.476   Issuance of decision and order.

    Within 20 days after the official termination of the hearing (see 
Sec. 725.475), the administrative law judge shall issue a decision and 
order with respect to the claim making an award to the claimant, 
rejecting the claim, or taking such other action as is appropriate.


Sec. 725.477   Form and contents of decision and order.

    (a) Orders adjudicating claims for benefits shall be designated by 
the term ``decision and order'' or ``supplemental decision and order'' 
as appropriate, followed by a descriptive phrase designating the 
particular type of order, such as ``award of benefits,'' ``rejection of 
claim,'' ``suspension of benefits,'' ``modification of award.''
    (b) A decision and order shall contain a statement of the basis of 
the order, the names of the parties, findings of fact, conclusions of 
law, and an award, rejection or other appropriate paragraph containing 
the action of the administrative law judge, his or her signature and 
the date of issuance. A decision and order shall be based upon the 
record made before the administrative law judge.


Sec. 725.478   Filing and service of decision and order.

    On the date of issuance of a decision and order under Sec. 725.477, 
the administrative law judge shall serve the decision and order on all 
parties to the claim by certified mail. On the same date, the original 
record of the claim shall be sent to the DCMWC in Washington, D.C. Upon 
receipt by the DCMWC, the decision and order shall be considered to be 
filed in the office of the district director, and shall become 
effective on that date.


Sec. 725.479   Finality of decisions and orders.

    (a) A decision and order shall become effective when filed in the 
office of the district director (see Sec. 725.478), and unless 
proceedings for suspension or setting aside of such order are 
instituted within 30 days of such filing, the order shall become final 
at the expiration of the 30th day after such filing (see Sec. 725.481).
    (b) Any party may, within 30 days after the filing of a decision 
and order under Sec. 725.478, request a reconsideration of such 
decision and order by the administrative law judge. The procedures to 
be followed in the reconsideration of a decision and order shall be 
determined by the administrative law judge.
    (c) The time for appeal to the Benefits Review Board shall be 
suspended during the consideration of a request for reconsideration. 
After the administrative law judge has issued and filed a denial of the 
request for reconsideration, or a revised decision and order in 
accordance with this part, any dissatisfied party shall have 30 days 
within which to institute proceedings to set aside the decision and 
order on reconsideration.
    (d) Regardless of any defect in service, actual receipt of the 
decision is sufficient to commence the 30-day period for requesting 
reconsideration or appealing the decision.


Sec. 725.480   Modification of decisions and orders.

    A party who is dissatisfied with a decision and order which has 
become final in accordance with Sec. 725.479 may request a modification 
of the decision and order if the conditions set forth in Sec. 725.310 
are met.


Sec. 725.481   Right to appeal to the Benefits Review Board.

    Any party dissatisfied with a decision and order issued by an 
administrative law judge may, before the decision and order becomes 
final (see Sec. 725.479), appeal the decision and order to the Benefits 
Review Board. A notice of appeal shall be filed with the Board. 
Proceedings before the Board shall be conducted in accordance with part 
802 of this title.


Sec. 725.482   Judicial review.

    (a) Any person adversely affected or aggrieved by a final order of 
the Benefits Review Board may obtain a review of that order in the U.S. 
court of appeals for the circuit in which the injury occurred by filing 
in such court within 60 days following the issuance of such Board order 
a written petition praying that the order be modified or set aside. The 
payment of the amounts required by an award shall not be stayed pending 
final decision in any such proceeding unless ordered by the court. No 
stay shall be issued unless the court finds that irreparable injury 
would otherwise ensue to an operator or carrier.
    (b) The Director, Office of Workers' Compensation Program, as 
designee of the Secretary of Labor responsible for the administration 
and enforcement of the Act, shall be considered the proper party to 
appear and present argument on behalf of the Secretary of Labor in all 
review proceedings conducted pursuant to this part and the Act, either 
as petitioner or respondent.


Sec. 725.483  Costs in proceedings brought without reasonable grounds.

    If a United States court having jurisdiction of proceedings 
regarding any claim or final decision and order, determines that the 
proceedings have been instituted or continued before such court without 
reasonable ground, the costs of such proceedings shall be assessed 
against the party who has so

[[Page 3409]]

instituted or continued such proceedings.

Subpart G--Responsible Coal Mine Operators

General Provisions


Sec. 725.490  Statutory provisions and scope.

    (a) One of the major purposes of the black lung benefits amendments 
of 1977 was to provide a more effective means of transferring the 
responsibility for the payment of benefits from the Federal government 
to the coal industry with respect to claims filed under this part. In 
furtherance of this goal, a Black Lung Disability Trust Fund financed 
by the coal industry was established by the Black Lung Benefits Revenue 
Act of 1977. The primary purpose of the Fund is to pay benefits with 
respect to all claims in which the last coal mine employment of the 
miner on whose account the claim was filed occurred before January 1, 
1970. With respect to most claims in which the miner's last coal mine 
employment occurred after January 1, 1970, individual coal mine 
operators will be liable for the payment of benefits. The 1981 
amendments to the Act relieved individual coal mine operators from the 
liability for payment of certain special claims involving coal mine 
employment on or after January 1, 1970, where the claim was previously 
denied and subsequently approved under section 435 of the Act. See 
Sec. 725.496 for a detailed description of these special claims. Where 
no such operator exists or the operator determined to be liable is in 
default in any case, the fund shall pay the benefits due and seek 
reimbursement as is appropriate. See also Sec. 725.420 for the fund's 
role in the payment of interim benefits in certain contested cases. In 
addition, the Black Lung Benefits Reform Act of 1977 amended certain 
provisions affecting the scope of coverage under the Act and describing 
the effects of particular corporate transactions on the liability of 
operators.
    (b) The provisions of this subpart define the term ``operator'' and 
prescribe the manner in which the identity of an operator which may be 
liable for the payment of benefits--referred to herein as a 
``responsible operator''--will be determined.


Sec. 725.491  Operator defined.

    (a) For purposes of this part, the term ``operator'' shall include:
    (1) Any owner, lessee, or other person who operates, controls, or 
supervises a coal mine, or any independent contractor performing 
services or construction at such mine; or
    (2) Any other person who:
    (i) Employs an individual in the transportation of coal or in coal 
mine construction in or around a coal mine, to the extent such 
individual was exposed to coal dust as a result of such employment (see 
Sec. 725.202);
    (ii) In accordance with the provisions of Sec. 725.492, may be 
considered a successor operator; or
    (iii) Paid wages or a salary, or provided other benefits, to an 
individual in exchange for work as a miner (see Sec. 725.202).
    (b) The terms ``owner,'' ``lessee,'' and ``person'' shall include 
any individual, partnership, association, corporation, firm, subsidiary 
of a corporation, or other organization, as appropriate, except that an 
officer of a corporation shall not be considered an ``operator'' for 
purposes of this part. Following the issuance of an order awarding 
benefits against a corporation that has not secured its liability for 
benefits in accordance with section 423 of the Act and Sec. 726.4, such 
order may be enforced against the president, secretary, or treasurer of 
the corporation in accordance with subpart I of this part.
    (c) The term ``independent contractor'' shall include any person 
who contracts to perform services. Such contractor's status as an 
operator shall not be contingent upon the amount or percentage of its 
work or business related to activities in or around a mine, nor upon 
the number or percentage of its employees engaged in such activities.
    (d) For the purposes of determining whether a person is or was an 
operator that may be found liable for the payment of benefits under 
this part, there shall be a rebuttable presumption that during the 
course of an individual's employment with such employer, such 
individual was regularly and continuously exposed to coal dust during 
the course of employment. The presumption may be rebutted by a showing 
that the employee was not exposed to coal dust for significant periods 
during such employment.
    (e) The operation, control, or supervision referred to in paragraph 
(a)(1) of this section may be exercised directly or indirectly. Thus, 
for example, where a coal mine is leased, and the lease empowers the 
lessor to make decisions with respect to the terms and conditions under 
which coal is to be extracted or prepared, such as, but not limited to, 
the manner of extraction or preparation or the amount of coal to be 
produced, the lessor may be considered an operator. Similarly, any 
parent entity or other controlling business entity may be considered an 
operator for purposes of this part, regardless of the nature of its 
business activities.
    (f) Neither the United States, nor any State, nor any 
instrumentality or agency of the United States or any State, shall be 
considered an operator.


Sec. 725.492  Successor operator defined.

    (a) Any person who, on or after January 1, 1970, acquired a mine or 
mines, or substantially all of the assets thereof, from a prior 
operator, or acquired the coal mining business of such prior operator, 
or substantially all of the assets thereof, shall be considered a 
``successor operator'' with respect to any miners previously employed 
by such prior operator.
    (b) The following transactions shall also be deemed to create 
successor operator liability:
    (1) If an operator ceases to exist by reason of a reorganization 
which involves a change in identity, form, or place of business or 
organization, however effected;
    (2) If an operator ceases to exist by reason of a liquidation into 
a parent or successor corporation; or
    (3) If an operator ceases to exist by reason of a sale of 
substantially all its assets, or as a result of merger, consolidation, 
or division.
    (c) In any case in which a transaction specified in paragraph (b), 
or substantially similar to a transaction specified in paragraph (b) 
took place, the resulting entity shall be considered a ``successor 
operator'' with respect to any miners previously employed by such prior 
operator.
    (d) This section shall not be construed to relieve a prior operator 
of any liability if such prior operator meets the conditions set forth 
in Sec. 725.494. If the prior operator does not meet the conditions set 
forth in Sec. 725.494, the following provisions shall apply:
    (1) In any case in which a prior operator transferred a mine or 
mines, or substantially all of the assets thereof, to a successor 
operator, or sold its coal mining business or substantially all of the 
assets thereof, to a successor operator, and then ceased to exist, 
within the terms of paragraph (b), the successor operator as identified 
in paragraph (a) shall be primarily liable for the payment of benefits 
to any miners previously employed by such prior operator.
    (2) In any case in which a prior operator transferred mines, or 
substantially all of the assets thereof, to more than one successor 
operator, the successor operator that most recently acquired a mine or 
mines or assets from the prior operator shall be primarily liable for 
the payment of benefits to any

[[Page 3410]]

miners previously employed by such prior operator.
    (3) In any case in which a mine or mines, or substantially all the 
assets thereof, have been transferred more than once, the successor 
operator that most recently acquired such mine or mines or assets shall 
be primarily liable for the payment of benefits to any miners 
previously employed by the original prior operator. If the most recent 
successor operator does not meet the criteria for a potentially liable 
operator set forth in Sec. 725.494, the next most recent successor 
operator shall be liable.
    (e) An ``acquisition,'' for purposes of this section, shall include 
any transaction by which title to the mine or mines, or substantially 
all of the assets thereof, or the right to extract or prepare coal at 
such mine or mines, becomes vested in a person other than the prior 
operator.


Sec. 725.493  Employment relationship defined.

    (a)(1) In determining the identity of a responsible operator under 
this part, the terms ``employ'' and ``employment'' shall be construed 
as broadly as possible, and shall include any relationship under which 
an operator retains the right to direct, control, or supervise the work 
performed by a miner, or any other relationship under which an operator 
derives a benefit from the work performed by a miner. Any individuals 
who participate with one or more persons in the mining of coal, such as 
owners, proprietors, partners, and joint venturers, whether they are 
compensated by wages, salaries, piece rates, shares, profits, or by any 
other means, shall be deemed employees.
    (2) The payment of wages or salary shall be prima facie evidence of 
the right to direct, control, or supervise an individual's work, and 
the Department intends that where the operator who paid a miner's wages 
or salary meets the criteria for a potentially liable operator set 
forth in Sec. 725.494, that operator shall be primarily liable for the 
payment of any benefits due the miner as a result of such employment. 
The absence of such payment, however, will not negate the existence of 
an employment relationship. Thus, the Department also intends that 
where the person who paid a miner's wages may not be considered a 
potentially liable operator, any other operator who retained the right 
to direct, control or supervise the work performed by the miner, or who 
benefitted from such work, may be considered a potentially liable 
operator.
    (b) This paragraph contains examples of relationships that shall be 
considered employment relationships for purposes of this part. The list 
is not intended to be exclusive.
    (1) In any case in which an operator may be considered a successor 
operator, as determined in accordance with Sec. 725.492, any employment 
with a prior operator shall also be deemed to be employment with the 
successor operator. In a case in which the miner was not independently 
employed by the successor operator, the prior operator shall remain 
primarily liable for the payment of any benefits based on the miner's 
employment with the prior operator. In a case in which the miner was 
independently employed by the successor operator after the transaction 
giving rise to successor operator liability, the successor operator 
shall be primarily liable for the payment of any benefits.
    (2) In any case in which the operator which directed, controlled or 
supervised the miner is no longer in business and such operator was a 
subsidiary of a parent company, a member of a joint venture, a partner 
in a partnership, or was substantially owned or controlled by another 
business entity, such parent entity or other member of a joint venture 
or partner or controlling business entity may be considered the 
employer of any employees of such operator.
    (3) In any claim in which the operator which directed, controlled 
or supervised the miner is a lessee, the lessee shall be considered 
primarily liable for the claim. The liability of the lessor may be 
established only after it has been determined that the lessee is unable 
to provide for the payment of benefits to a successful claimant. In any 
case involving the liability of a lessor for a claim arising out of 
employment with a lessee, any determination of lessor liability shall 
be made on the basis of the facts present in the case in accordance 
with the following considerations:
    (i) Where a coal mine is leased, and the lease empowers the lessor 
to make decisions with respect to the terms and conditions under which 
coal is to be extracted or prepared, such as, but not limited to, the 
manner of extraction or preparation or the amount of coal to be 
produced, the lessor shall be considered the employer of any employees 
of the lessee.
    (ii) Where a coal mine is leased to a self-employed operator, the 
lessor shall be considered the employer of such self-employed operator 
and its employees if the lease or agreement is executed or renewed 
after August 18, 1978 and such lease or agreement does not require the 
lessee to guarantee the payment of benefits which may be required under 
this part and part 726 of this subchapter.
    (iii) Where a lessor previously operated a coal mine, it may be 
considered an operator with respect to employees of any lessee of such 
mine, particularly where the leasing arrangement was executed or 
renewed after August 18, 1978 and does not require the lessee to secure 
benefits provided by the Act.
    (4) A self-employed operator, depending upon the facts of the case, 
may be considered an employee of any other operator, person, or 
business entity which substantially controls, supervises, or is 
financially responsible for the activities of the self-employed 
operator.


Sec. 725.494  Potentially liable operators.

    An operator may be considered a ``potentially liable operator'' 
with respect to a claim for benefits under this part if each of the 
following conditions is met:
    (a) The miner's disability or death shall have arisen at least in 
part out of employment in or around a mine or other facility during a 
period when the mine or facility was operated by such operator, or by a 
person with respect to which the operator may be considered a successor 
operator. For purposes of this section, there shall be a rebuttable 
presumption that the miner's disability or death arose in whole or in 
part out of his or her employment with such operator. Unless this 
presumption is rebutted, the responsible operator shall be liable to 
pay benefits to the claimant on account of the disability or death of 
the miner in accordance with this part. A miner's pneumoconiosis, or 
disability or death therefrom, shall be considered to have arisen in 
whole or in part out of work in or around a mine if such work caused, 
contributed to or aggravated the progression or advancement of a 
miner's loss of ability to perform his or her regular coal mine 
employment or comparable employment.
    (b) The operator, or any person with respect to which the operator 
may be considered a successor operator, shall have been an operator for 
any period after June 30, 1973.
    (c) The miner shall have been employed by the operator, or any 
person with respect to which the operator may be considered a successor 
operator, for a cumulative period of not less than one year 
(Sec. 725.101(a)(32)).
    (d) The miner's employment with the operator, or any person with 
respect to which the operator may be considered a successor operator, 
shall have included at least one working day

[[Page 3411]]

(Sec. 725.101(a)(32)) after December 31, 1969.
    (e) The operator shall be capable of assuming its liability for the 
payment of continuing benefits under this part. An operator will be 
deemed capable of assuming its liability for a claim if one of the 
following three conditions is met:
    (1) The operator obtained a policy or contract of insurance under 
section 423 of the Act and part 726 of this subchapter that covers the 
claim, except that such policy shall not be considered sufficient to 
establish the operator's capability of assuming liability if the 
insurance company has been declared insolvent and its obligations for 
the claim are not otherwise guaranteed;
    (2) The operator qualified as a self-insurer under section 423 of 
the Act and part 726 of this subchapter during the period in which the 
miner was last employed by the operator, provided that the operator 
still qualifies as a self-insurer or the security given by the operator 
pursuant to Sec. 726.104(b) is sufficient to secure the payment of 
benefits in the event the claim is awarded; or
    (3) The operator possesses sufficient assets to secure the payment 
of benefits in the event the claim is awarded in accordance with 
Sec. 725.606 of this part.


Sec. 725.495  Criteria for determining a responsible operator.

    (a)(1) The operator responsible for the payment of benefits in a 
claim adjudicated under this part (the ``responsible operator'') shall 
be the potentially liable operator, as determined in accordance with 
Sec. 725.494, that most recently employed the miner.
    (2) If more than one potentially liable operator may be deemed to 
have employed the miner most recently, then the liability for any 
benefits payable as a result of such employment shall be assigned as 
follows:
    (i) First, to the potentially liable operator that directed, 
controlled, or supervised the miner;
    (ii) Second, to any potentially liable operator that may be 
considered a successor operator with respect to miners employed by the 
operator identified in paragraph (a)(2)(i); and
    (iii) Third, to any other potentially liable operator which may be 
deemed to have been the miner's most recent employer pursuant to 
Sec. 725.493 of this part.
    (3) If the operator that most recently employed the miner may not 
be considered a potentially liable operator, as determined in 
accordance with Sec. 725.494, the responsible operator shall be the 
potentially liable operator that next most recently employed the miner. 
Any potentially liable operator that employed the miner for at least 
one day after December 31, 1969 may be deemed the responsible operator 
if no more recent employer may be considered a potentially liable 
operator.
    (b) Except as provided in this section and Sec. 725.408(a)(3) of 
this part, with respect to the adjudication of the identity of a 
responsible operator, the Director shall bear the burden of proving 
that the responsible operator initially found liable for the payment of 
benefits pursuant to Sec. 725.410 of this part (the ``designated 
responsible operator'') is a potentially liable operator. It shall be 
presumed, in the absence of evidence to the contrary, that the 
designated responsible operator is capable of assuming liability for 
the payment of benefits in accordance with Sec. 725.494(e) of this 
part.
    (c) The designated responsible operator shall bear the burden of 
proving either:
    (1) that it does not possess sufficient assets to secure the 
payment of benefits in accordance with Sec. 725.606 of this part; or
    (2) that it is not the potentially liable operator that most 
recently employed the miner. Such proof must include evidence that the 
miner was employed as a miner after he or she stopped working for the 
designated responsible operator and that the person by whom he or she 
was employed is a potentially liable operator within the meaning of 
Sec. 725.494. In order to establish that a more recent employer is a 
potentially liable operator, the designated responsible operator must 
demonstrate that the more recent employer possesses sufficient assets 
to secure the payment of benefits in accordance with Sec. 725.606 of 
this part. The designated responsible operator may satisfy its burden 
by presenting evidence that the owner, if the more recent employer is a 
sole proprietorship; the partners, if the more recent employer is a 
partnership; or the president, secretary, and treasurer, if the more 
recent employer is a corporation that failed to secure the payment of 
benefits pursuant to part 726 of this subchapter, possess assets 
sufficient to secure the payment of benefits, provided such assets may 
be reached in a proceeding brought under subpart I of this part.
    (d) In any case referred to the Office of Administrative Law Judges 
pursuant to Sec. 725.421 in which the responsible operator initially 
found liable for the payment of benefits pursuant to Sec. 725.410 is 
not the operator that most recently employed the miner, the record 
shall contain a statement from the district director explaining the 
reasons for such initial finding. If the reasons include the most 
recent employer's failure to meet the conditions of Sec. 725.494(e), 
the record shall also contain a statement that the Office has searched 
the files it maintains pursuant to part 726, and that the Office has no 
record of insurance coverage for that employer, or of authorization to 
self-insure, that meets the conditions of Sec. 725.494(e)(1) or (e)(2). 
Such a statement shall be prima facie evidence that the most recent 
employer is not financially capable of assuming its liability for a 
claim. In the absence of such a statement, it shall be presumed that 
the most recent employer is financially capable of assuming its 
liability for a claim.


Sec. 725.496  Special claims transferred to the fund.

    (a) The 1981 amendments to the Act amended section 422 of the Act 
and transferred liability for payment of certain special claims from 
operators and carriers to the fund. These provisions apply to claims 
which were denied before March 1, 1978, and which have been or will be 
approved in accordance with section 435 of the Act.
    (b) Section 402(i) of the Act defines three classes of denied 
claims subject to the transfer provisions:
    (1) Claims filed with and denied by the Social Security 
Administration before March 1, 1978;
    (2) Claims filed with the Department of Labor in which the claimant 
was notified by the Department of an administrative or informal denial 
before March 1, 1977, and in which the claimant did not within one year 
of such notification either:
    (i) Request a hearing; or
    (ii) Present additional evidence; or
    (iii) Indicate an intention to present additional evidence; or
    (iv) Request a modification or reconsideration of the denial on the 
ground of a change in conditions or because of a mistake in a 
determination of fact.
    (3) Claims filed with the Department of Labor and denied under the 
law in effect prior to the enactment of the Black Lung Benefits Reform 
Act of 1977, that is, before March 1, 1978, following a formal hearing 
before an administrative law judge or administrative review before the 
Benefits Review Board or review before a United States Court of 
Appeals.
    (c) Where more than one claim was filed with the Social Security 
Administration and/or the Department of Labor prior to March 1, 1978, 
by or on behalf of a miner or a surviving

[[Page 3412]]

dependent of a miner, unless such claims were required to be merged by 
the agency's regulations, the procedural history of each such claim 
must be considered separately to determine whether the claim is subject 
to the transfer of liability provisions.
    (d) For a claim filed with and denied by the Social Security 
Administration prior to March 1, 1978, to come within the transfer 
provisions, such claim must have been or must be approved under the 
provisions of section 435 of the Act. No claim filed with and denied by 
the Social Security Administration is subject to the transfer of 
liability provisions unless a request was made by or on behalf of the 
claimant for review of such denied claim under section 435. Such review 
must have been requested by the filing of a valid election card or 
other equivalent document with the Social Security Administration in 
accordance with section 435(a) and its implementing regulations at 20 
CFR 410.700 through 410.707.
    (e) Where a claim filed with the Department of Labor prior to March 
1, 1977, was subjected to repeated administrative or informal denials, 
the last such denial issued during the pendency of the claim determines 
whether the claim is subject to the transfer of liability provisions.
    (f) Where a miner's claim comes within the transfer of liability 
provisions of the 1981 amendments the fund is also liable for the 
payment of any benefits to which the miner's dependent survivors are 
entitled after the miner's death. However, if the survivor's 
entitlement was established on a separate claim not subject to the 
transfer of liability provisions prior to approval of the miner's claim 
under section 435, the party responsible for the payment of such 
survivors' benefits shall not be relieved of that responsibility 
because the miner's claim was ultimately approved and found subject to 
the transfer of liability provisions.


Sec. 725.497  Procedures in special claims transferred to the fund.

    (a) General. It is the purpose of this section to define procedures 
to expedite the handling and disposition of claims affected by the 
benefit liability transfer provisions of Section 205 of the Black Lung 
Benefits Amendments of 1981.
    (b) Action by the Department. The OWCP shall, in accordance with 
the criteria contained in Sec. 725.496, review each claim which is or 
may be affected by the provisions of Section 205 of the Black Lung 
Benefits Amendments of 1981. Any party to a claim, adjudication 
officer, or adjudicative body may request that such a review be 
conducted and that the record be supplemented with any additional 
documentation necessary for an informed consideration of the 
transferability of the claim. Where the issue of the transferability of 
the claim can not be resolved by agreement of the parties and the 
evidence of record is not sufficient for a resolution of the issue, the 
hearing record may be reopened or the case remanded for the development 
of the additional evidence concerning the procedural history of the 
claim necessary to such resolution. Such determinations shall be made 
on an expedited basis.
    (c) Dismissal of operators. If it is determined that a coal mine 
operator or insurance carrier which previously participated in the 
consideration or adjudication of any claim, may no longer be found 
liable for the payment of benefits to the claimant by reason of section 
205 of the Black Lung Benefits Amendments of 1981, such operator or 
carrier shall be promptly dismissed as a party to the claim. The 
dismissal of an operator or carrier shall be concluded at the earliest 
possible time and in no event shall an operator or carrier participate 
as a necessary party in any claim for which only the fund may be 
liable.
    (d) Procedure following dismissal of an operator. After it has been 
determined that an operator or carrier must be dismissed as a party in 
any claim in accordance with this section, the Director shall take such 
action as is authorized by the Act to bring about the proper and 
expeditious resolution of the claim in light of all relevant medical 
and other evidence. Action to be taken in this regard by the Director 
may include, but is not limited to, the assignment of the claim to the 
Black Lung Disability Trust Fund for the payment of benefits, the 
reimbursement of benefits previously paid by an operator or carrier if 
appropriate, the defense of the claim on behalf of the fund, or 
proceedings authorized by Sec. 725.310.
    (e) Any claimant whose claim has been subsequently denied in a 
modification proceeding will be entitled to expedited review of the 
modification decision. Where a formal hearing was previously held, the 
claimant may waive his right to a further hearing and ask that a 
decision be made on the record of the prior hearing, as supplemented by 
any additional documentary evidence which the parties wish to introduce 
and briefs of the parties, if desired. In any case in which the 
claimant waives his right to a second hearing, a decision and order 
must be issued within 30 days of the date upon which the parties agree 
the record has been completed.

Subpart H--Payment of Benefits

General Provisions


Sec. 725.501  Payment provisions generally.

    The provisions of this subpart govern the payment of benefits to 
claimants whose claims are approved for payment under section 415 and 
part C of title IV of the Act or approved after review under section 
435 of the Act and part 727 of this subchapter (see Sec. 725.4(d)).


Sec. 725.502  When benefit payments are due; manner of payment.

    (a)(1) Except with respect to benefits paid by the fund pursuant to 
an initial determination issued in accordance with Sec. 725.418 (see 
Sec. 725.522), benefits under the Act shall be paid when they become 
due. Benefits shall be considered due after the issuance of an 
effective order requiring the payment of benefits by a district 
director, administrative law judge, Benefits Review Board, or court, 
notwithstanding the pendency of a motion for reconsideration before an 
administrative law judge or an appeal to the Board or court, except 
that benefits shall not be considered due where the payment of such 
benefits has been stayed by the Benefits Review Board or appropriate 
court. An effective order shall remain in effect unless it is vacated 
by an administrative law judge on reconsideration, or, upon review 
under section 21 of the LHWCA, by the Benefits Review Board or an 
appropriate court, or is superseded by an effective order issued 
pursuant to Sec. 725.310.
    (2) A proposed order issued by a district director pursuant to 
Sec. 725.418 becomes effective at the expiration of the thirtieth day 
thereafter if no party timely requests revision of the proposed 
decision and order or a hearing (see Sec. 725.419). An order issued by 
an administrative law judge becomes effective when it is filed in the 
office of the district director (see Sec. 725.479). An order issued by 
the Benefits Review Board shall become effective when it is issued. An 
order issued by a court shall become effective in accordance with the 
rules of the court.
    (b)(1) While an effective order requiring the payment of benefits 
remains in effect, monthly benefits, at the rates set forth in 
Sec. 725.520, shall be due on the first business day of the month 
following the month for which the benefits are payable. For example, 
benefits payable for the month of January shall be due on the first 
business day in February.

[[Page 3413]]

    (2) Within 30 days after the issuance of an effective order 
requiring the payment of benefits, the district director shall compute 
the amount of benefits payable for periods prior to the effective date 
of the order, in addition to any interest payable for such periods (see 
Sec. 725.608), and shall so notify the parties. Any computation made by 
the district director under this paragraph shall strictly observe the 
terms of the order. Benefits and interest payable for such periods 
shall be due on the thirtieth day following issuance of the district 
director's computation. A copy of the current table of applicable 
interest rates shall be attached.
    (c) Benefits are payable for monthly periods and shall be paid 
directly to an eligible claimant or his or her representative payee 
(see Sec. 725.510) beginning with the month during which eligibility 
begins. Benefit payments shall terminate with the month before the 
month during which eligibility terminates. If a claimant dies in the 
first month during which all requirements for eligibility are met, 
benefits shall be paid for that month.


Sec. 725.503  Date from which benefits are payable.

    (a) In accordance with the provisions of section 6(a) of the 
Longshore Act as incorporated by section 422(a) of the Act, and except 
as provided in Sec. 725.504, the provisions of this section shall be 
applicable in determining the date from which benefits are payable to 
an eligible claimant for any claim filed after March 31, 1980. Except 
as provided in paragraph (d), the date from which benefits are payable 
for any claim approved under part 727 shall be determined in accordance 
with Sec. 727.302 (see Sec. 725.4(d)).
    (b) Miner's claim. In the case of a miner who is entitled to 
benefits, benefits are payable to such miner beginning with the month 
of onset of total disability due to pneumoconiosis arising out of coal 
mine employment. Where the evidence does not establish the month of 
onset, benefits shall be payable to such miner beginning with the month 
during which the claim was filed. In the case of a miner who filed a 
claim before January 1, 1982, benefits shall be payable to the miner's 
eligible survivor (if any) beginning with the month in which the miner 
died.
    (c) Survivor's claim. In the case of an eligible survivor, benefits 
shall be payable beginning with the month of the miner's death, or 
January 1, 1974, whichever is later.
    (d) If a claim is awarded pursuant to section 22 of the Longshore 
Act and Sec. 725.310, then the date from which benefits are payable 
shall be determined as follows:
    (1) Mistake in fact. The provisions of paragraphs (b) or (c) of 
this section, as applicable, shall govern the determination of the date 
from which benefits are payable.
    (2) Change in conditions. Benefits are payable to a miner beginning 
with the month of onset of total disability due to pneumoconiosis 
arising out of coal mine employment, provided that no benefits shall be 
payable for any month prior to the effective date of the most recent 
denial of the claim by a district director or administrative law judge. 
Where the evidence does not establish the month of onset, benefits 
shall be payable to such miner from the month of the earliest evidence 
the adjudication officer finds supportive of a condition of entitlement 
(see Sec. 725.202(d)) not previously resolved in favor of the claimant 
in the denial of benefits the claimant seeks to modify, provided that 
such evidence was developed after the date upon which the most recent 
denial by a district director or administrative law judge became 
effective.
    (e) In the case of a claim filed between July 1, 1973, and December 
31, 1973, benefits shall be payable as provided by this section, except 
to the extent prohibited by Sec. 727.303 (see Sec. 725.4(d)).
    (f) No benefits shall be payable with respect to a claim filed 
after December 31, 1973 (a part C claim), for any period of eligibility 
occurring before January 1, 1974.
    (g) Each decision and order awarding benefits shall indicate the 
month from which benefits are payable to the eligible claimant.


Sec. 725.504  Payments to a claimant employed as a miner.

    (a) In the case of a claimant who is employed as a miner (see 
Sec. 725.202) at the time of a final determination of such miner's 
eligibility for benefits, no benefits shall be payable unless:
    (1) The miner's eligibility is established under section 411(c)(3) 
of the Act; or
    (2) The miner terminates his or her coal mine employment within 1 
year from the date of the final determination of the claim.
    (b) If the eligibility of a working miner is established under 
section 411(c)(3) of the Act, benefits shall be payable as is otherwise 
provided in this part. If eligibility cannot be established under 
section 411(c)(3), and the miner continues to be employed as a miner in 
any capacity for a period of less than 1 year after a final 
determination of the claim, benefits shall be payable beginning with 
the month during which the miner ends his or her coal mine employment. 
If the miner's employment continues for more than 1 year after a final 
determination of eligibility, such determination shall be considered a 
denial of benefits on the basis of the miner's continued employment, 
and the miner may seek benefits only as provided in Sec. 725.310, if 
applicable, or by filing a new claim under this part. The provisions of 
Subparts E and F of this part shall be applicable to claims considered 
under this section as is appropriate.
    (c) In any case where the miner returns to coal mine or comparable 
and gainful work, the payments to such miner shall be suspended and no 
benefits shall be payable (except as provided in section 411(c)(3) of 
the Act) for the period during which the miner continues to work. If 
the miner again terminates employment, the district director may 
require the miner to submit to further medical examination before 
authorizing the payment of benefits.


Sec. 725.505  Payees.

    Benefits may be paid, as appropriate, to a beneficiary, to a 
qualified dependent, or to a representative authorized under this 
subpart to receive payments on behalf of such beneficiary or dependent.


Sec. 725.506  Payment on behalf of another; ``legal guardian'' defined.

    Benefits are paid only to the beneficiary, his or her 
representative payee (see Sec. 725.510) or his or her legal guardian. 
As used in this section, ``legal guardian'' means an individual who has 
been appointed by a court of competent jurisdiction or otherwise 
appointed pursuant to law to assume control of and responsibility for 
the care of the beneficiary, the management of his or her estate, or 
both.


Sec. 725.507  Guardian for minor or incompetent.

    An adjudication officer may require that a legal guardian or 
representative be appointed to receive benefit payments payable to any 
person who is mentally incompetent or a minor and to exercise the 
powers granted to, or to perform the duties otherwise required of such 
person under the Act.


Sec. 725.510   Representative payee.

    (a) If the district director determines that the best interests of 
a beneficiary are served thereby, the district director may certify the 
payment of such beneficiary's benefits to a representative payee.
    (b) Before any amount shall be certified for payment to any

[[Page 3414]]

representative payee for or on behalf of a beneficiary, such 
representative payee shall submit to the district director such 
evidence as may be required of his or her relationship to, or his or 
her responsibility for the care of, the beneficiary on whose behalf 
payment is to be made, or of his or her authority to receive such a 
payment. The district director may, at any time thereafter, require 
evidence of the continued existence of such relationship, 
responsibility, or authority. If a person requesting representative 
payee status fails to submit the required evidence within a reasonable 
period of time after it is requested, no further payments shall be 
certified to him or her on behalf of the beneficiary unless the 
required evidence is thereafter submitted.
    (c) All benefit payments made to a representative payee shall be 
available only for the use and benefit of the beneficiary, as defined 
in Sec. 725.511.


Sec. 725.511  Use and benefit defined.

    (a) Payments certified to a representative payee shall be 
considered as having been applied for the use and benefit of the 
beneficiary when they are used for the beneficiary's current 
maintenance--i.e., to replace current income lost because of the 
disability of the beneficiary. Where a beneficiary is receiving care in 
an institution, current maintenance shall include the customary charges 
made by the institution and charges made for the current and 
foreseeable needs of the beneficiary which are not met by the 
institution.
    (b) Payments certified to a representative payee which are not 
needed for the current maintenance of the beneficiary, except as they 
may be used under Sec. 725.512, shall be conserved or invested on the 
beneficiary's behalf. Preferred investments are U.S. savings bonds 
which shall be purchased in accordance with applicable regulations of 
the U.S. Treasury Department (31 CFR part 315). Surplus funds may also 
be invested in accordance with the rules applicable to investment of 
trust estates by trustees. For example, surplus funds may be deposited 
in an interest or dividend bearing account in a bank or trust company 
or in a savings and loan association if the account is either federally 
insured or is otherwise insured in accordance with State law 
requirements. Surplus funds deposited in an interest or dividend 
bearing account in a bank or trust company or in a savings and loan 
association must be in a form of account which clearly shows that the 
representative payee has only a fiduciary, and not a personal, interest 
in the funds. The preferred forms of such accounts are as follows:

Name of beneficiary----------------------------------------------------
by (Name of representative payee) representative payee,
or (Name of beneficiary)
by (Name of representative payee) trustee,

    U.S. savings bonds purchased with surplus funds by a 
representative payee for an incapacitated adult beneficiary should 
be registered as follows: (Name of beneficiary) (Social Security 
No.), for whom (Name of payee) is representative payee for black 
lung benefits.


Sec. 725.512  Support of legally dependent spouse, child, or parent.

    If current maintenance needs of a beneficiary are being reasonably 
met, a relative or other person to whom payments are certified as 
representative payee on behalf of the beneficiary may use part of the 
payments so certified for the support of the legally dependent spouse, 
a legally dependent child, or a legally dependent parent of the 
beneficiary.


Sec. 725.513  Accountability; transfer.

    (a) The district director may require a representative payee to 
submit periodic reports including a full accounting of the use of all 
benefit payments certified to a representative payee. If a requested 
report or accounting is not submitted within the time allowed, the 
district director shall terminate the certification of the 
representative payee and thereafter payments shall be made directly to 
the beneficiary. A certification which is terminated under this section 
may be reinstated for good cause, provided that all required reports 
are supplied to the district director.
    (b) A representative payee who has conserved or invested funds from 
payments under this part shall, upon the direction of the district 
director, transfer any such funds (including interest) to a successor 
payee appointed by the district director or, at the option of the 
district director, shall transfer such funds to the Office for 
recertification to a successor payee or the beneficiary.


Sec. 725.514  Certification to dependent of augmentation portion of 
benefit.

    (a) If the basic benefit of a miner or of a surviving spouse is 
augmented because of one or more dependents, and it appears to the 
district director that the best interests of such dependent would be 
served thereby, or that the augmented benefit is not being used for the 
use and benefit (as defined in this subpart) of the augmentee, the 
district director may certify payment of the amount of such 
augmentation (to the extent attributable to such dependent) to such 
dependent directly, or to a legal guardian or a representative payee 
for the use and benefit of such dependent.
    (b) Any request to the district director to certify separate 
payment of the amount of an augmentation in accordance with paragraph 
(a) of this section shall be in writing on such form and in accordance 
with such instructions as are prescribed by the Office.
    (c) The district director shall specify the terms and conditions of 
any certification authorized under this section and may terminate any 
such certification where appropriate.
    (d) Any payment made under this section, if otherwise valid under 
the Act, is a complete settlement and satisfaction of all claims, 
rights, and interests in and to such payment, except that such payment 
shall not be construed to abridge the rights of any party to recoup any 
overpayment made.


Sec. 725.515  Assignment and exemption from claims of creditors.

    Except as provided by the Act and this part, no assignment, 
release, or commutation of benefits due or payable under this part 
shall be valid, and all benefits shall be exempt from claims of 
creditors and from levy, execution, and attachment or other remedy or 
recovery or collection of a debt, which exemption may not be waived.

Benefit Rates


Sec. 725.520  Computation of benefits.

    (a) Basic rate. The amount of benefits payable to a beneficiary for 
a month is determined, in the first instance, by computing the ``basic 
rate.'' The basic rate is equal to 37\1/2\ percent of the monthly pay 
rate for Federal employees in GS-2, step 1. That rate for a month is 
determined by:
    (1) Ascertaining the lowest annual rate of pay (step 1) for Grade 
GS-2 of the General Schedule applicable to such month (see 5 U.S.C. 
5332);
    (2) Ascertaining the monthly rate thereof by dividing the amount 
determined in paragraph (a)(1) of this section by 12; and
    (3) Ascertaining the basic rate under the Act by multiplying the 
amount determined in paragraph (a)(2) of this section by 0.375 (that 
is, by 37\1/2\ percent).
    (b) Basic benefit. When a miner or surviving spouse is entitled to 
benefits for a month for which he or she has no dependents who qualify 
under this part and when a surviving child of a miner or spouse, or a 
parent, brother, or sister of a miner, is entitled to benefits for a 
month for which he or she is the only beneficiary entitled to benefits, 
the

[[Page 3415]]

amount of benefits to which such beneficiary is entitled is equal to 
the basic rate as computed in accordance with this section (raised, if 
not a multiple of 10 cents, to the next high multiple of 10 cents). 
This amount is referred to as the ``basic benefit.''
    (c) Augmented benefit. (1) When a miner or surviving spouse is 
entitled to benefits for a month for which he or she has one or more 
dependents who qualify under this part, the amount of benefits to which 
such miner or surviving spouse is entitled is increased. This increase 
is referred to as an ``augmentation.''
    (2) The benefits of a miner or surviving spouse are augmented to 
take account of a particular dependent beginning with the first month 
in which such dependent satisfies the conditions set forth in this 
part, and continues to be augmented through the month before the month 
in which such dependent ceases to satisfy the conditions set forth in 
this part, except in the case of a child who qualifies as a dependent 
because he or she is a student. In the latter case, such benefits 
continue to be augmented through the month before the first month 
during no part of which he or she qualifies as a student.
    (3) The basic rate is augmented by 50 percent for one such 
dependent, 75 percent for two such dependents, and 100 percent for 
three or more such dependents.
    (d) Survivor benefits. As used in this section, ``survivor'' means 
a surviving child of a miner or surviving spouse, or a surviving 
parent, brother, or sister of a miner, who establishes entitlement to 
benefits under this part.
    (e) Computation and rounding. (1) Any computation prescribed by 
this section is made to the third decimal place.
    (2) Monthly benefits are payable in multiples of 10 cents. 
Therefore, a monthly payment of amounts derived under paragraph (c)(3) 
of this section which is not a multiple of 10 cents is increased to the 
next higher multiple of 10 cents.
    (3) Since a fraction of a cent is not a multiple of 10 cents, such 
an amount which contains a fraction in the third decimal place is 
raised to the next higher multiple of 10 cents.
    (f) Eligibility based on the coal mine employment of more than one 
miner. Where an individual, for any month, is entitled (and/or 
qualifies as a dependent for purposes of augmentation of benefits) 
based on the disability or death due to pneumoconiosis arising out of 
the coal mine employment of more than one miner, the benefit payable to 
or on behalf of such individual shall be at a rate equal to the highest 
rate of benefits for which entitlement is established by reason of 
eligibility as a beneficiary, or by reason of his or her qualification 
as a dependent for augmentation of benefit purposes.


Sec. 725.521  Commutation of payments; lump sum awards.

    (a) Whenever the district director determines that it is in the 
interest of justice, the liability for benefits or any part thereof as 
determined by a final adjudication, may, with the approval of the 
Director, be discharged by the payment of a lump sum equal to the 
present value of future benefit payments commuted, computed at 4 
percent true discount compounded annually.
    (b) Applications for commutation of future payments of benefits 
shall be made to the district director in the manner prescribed by the 
district director. If the district director determines that an award of 
a lump sum payment of such benefits would be in the interest of 
justice, he or she shall refer such application, together with the 
reasons in support of such determination, to the Director for 
consideration.
    (c) The Director shall, in his or her discretion, grant or deny the 
application for commutation of payments. Such decision may be appealed 
to the Benefits Review Board.
    (d) The computation of all commutations of such benefits shall be 
made by the OWCP. For this purpose the file shall contain the date of 
birth of the person on whose behalf commutation is sought, as well as 
the date upon which such commutation shall be effective.
    (e) For purposes of determining the amount of any lump sum award, 
the probability of the death of the disabled miner and/or other persons 
entitled to benefits before the expiration of the period during which 
he or she is entitled to benefits, shall be determined in accordance 
with the most current United States Life Tables, as developed by the 
Department of Health, Education, and Welfare, and the probability of 
the remarriage of a surviving spouse shall be determined in accordance 
with the remarriage tables of the Dutch Royal Insurance Institution. 
The probability of the happening of any other contingency affecting the 
amount or duration of the compensation shall be disregarded.
    (f) In the event that an operator or carrier is adjudicated liable 
for the payment of benefits, such operator or carrier shall be notified 
of and given an opportunity to participate in the proceedings to 
determine whether a lump sum award shall be made. Such operator or 
carrier shall, in the event a lump sum award is made, tender full and 
prompt payment of such award to the claimant as though such award were 
a final payment of monthly benefits. Except as provided in paragraph 
(g) of this section, such lump sum award shall forever discharge such 
operator or carrier from its responsibility to make monthly benefit 
payments under the Act to the person who has requested such lump-sum 
award. In the event that an operator or carrier is adjudicated liable 
for the payment of benefits, such operator or carrier shall not be 
liable for any portion of a commuted or lump sum award predicated upon 
benefits due any claimant prior to January 1, 1974.
    (g) In the event a lump-sum award is approved under this section, 
such award shall not operate to discharge an operator carrier, or the 
fund from any responsibility imposed by the Act for the payment of 
medical benefits to an eligible miner.


Sec. 725.522  Payments prior to final adjudication.

    (a) If an operator or carrier fails or refuses to commence the 
payment of benefits within 30 days of issuance of an initial 
determination of eligibility by the district director (see 
Sec. 725.420), or fails or refuses to commence the payment of any 
benefits due pursuant to an effective order by a district director, 
administrative law judge, Benefits Review Board, or court, the fund 
shall commence the payment of such benefits and shall continue such 
payments as appropriate. In the event that the fund undertakes the 
payment of benefits on behalf of an operator or carrier, the provisions 
of Secs. 725.601 through 725.609 shall be applicable to such operator 
or carrier.
    (b) If benefit payments are commenced prior to the final 
adjudication of the claim and it is later determined by an 
administrative law judge, the Board, or court that the claimant was 
ineligible to receive such payments, such payments shall be considered 
overpayments pursuant to Sec. 725.540 of this subpart and may be 
recovered in accordance with the provisions of this subpart.

Special Provisions for Operator Payments


Sec. 725.530  Operator payments; generally.

    (a) Benefits payable by an operator or carrier pursuant to an 
effective order issued by a district director, administrative law 
judge, Benefits Review Board, or court, or by an operator that has 
agreed that it is liable for the payment of benefits to a claimant, 
shall be paid by the operator

[[Page 3416]]

or carrier immediately when they become due (see Sec. 725.502(b)). An 
operator that fails to pay any benefits that are due, with interest, 
shall be considered in default with respect to those benefits, and the 
provisions of Sec. 725.605 of this part shall be applicable. In 
addition, a claimant who does not receive any benefits within 10 days 
of the date they become due is entitled to additional compensation 
equal to twenty percent of those benefits (see Sec. 725.607). 
Arrangements for the payment of medical costs shall be made by such 
operator or carrier in accordance with the provisions of subpart J of 
this part.
    (b) Benefit payments made by an operator or carrier shall be made 
directly to the person entitled thereto or a representative payee if 
authorized by the district director. The payment of a claimant's 
attorney's fee, if any is awarded, shall be made directly to such 
attorney. Reimbursement of the fund, including interest, shall be paid 
directly to the Secretary on behalf of the fund.


Sec. 725.531  Receipt for payment.

    Any individual receiving benefits under the Act in his or her own 
right, or as a representative payee, or as the duly appointed agent for 
the estate of a deceased beneficiary, shall execute receipts for 
benefits paid by any operator which shall be produced by such operator 
for inspection whenever the district director requires. A canceled 
check shall be considered adequate receipt of payment for purposes of 
this section. No operator or carrier shall be required to retain 
receipts for payments made for more than 5 years after the date on 
which such receipt was executed.

(Approved by the Office of Management and Budget under control 
number 1215-0124)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))


Sec. 725.532  Suspension, reduction, or termination of payments.

    (a) No suspension, reduction, or termination in the payment of 
benefits is permitted unless authorized by the district director, 
administrative law judge, Board, or court. No suspension, reduction, or 
termination shall be authorized except upon the occurrence of an event 
which terminates a claimant's eligibility for benefits (see subpart B 
of this part) or as is otherwise provided in subpart C of this part, 
Secs. 725.306 and 725.310, or this subpart (see also Secs. 725.533 
through 725.546).
    (b) Any unauthorized suspension in the payment of benefits by an 
operator or carrier shall be treated as provided in subpart I.
    (c) Unless suspension, reduction, or termination of benefits 
payments is required by an administrative law judge, the Benefits 
Review Board or a court, the district director, after receiving 
notification of the occurrence of an event that would require the 
suspension, reduction, or termination of benefits, shall follow the 
procedures for the determination of claims set forth in subparts E and 
F.

Increases and Reductions of Benefits


Sec. 725.533  Modification of benefits amounts; general.

    (a) Under certain circumstances the amount of monthly benefits as 
computed in Sec. 725.520 or lump-sum award (Sec. 725.521) shall be 
modified to determine the amount actually to be paid to a beneficiary. 
With respect to any benefits payable for all periods of eligibility 
after January 1, 1974, a reduction of the amount of benefits payable 
shall be required on account of:
    (1) Any compensation or benefits received under any State workers' 
compensation law because of death or partial or total disability due to 
pneumoconiosis; or
    (2) Any compensation or benefits received under or pursuant to any 
Federal law including part B of title IV of the Act because of death or 
partial or total disability due to pneumoconiosis; or
    (3) In the case of benefits to a parent, brother, or sister as a 
result of a claim filed at any time or benefits payable on a miner's 
claim which was filed on or after January 1, 1982, the excess earnings 
from wages and from net earnings from self-employment (see Sec. 410.530 
of this title) of such parent, brother, sister, or miner, respectively; 
or
    (4) The fact that a claim for benefits from an additional 
beneficiary is filed, or that such claim is effective for a payment 
during the month of filing, or a dependent qualifies under this part 
for an augmentation portion of a benefit of a miner or widow for a 
period in which another dependent has previously qualified for an 
augmentation.
    (b) With respect to periods of eligibility occurring after June 30, 
1973, but before January 1, 1974, benefits shall be reduced in months 
of eligibility occurring during such period only:
    (1) By an amount equal to any payment received under the workers' 
compensation, unemployment compensation, or disability insurance laws 
of any State on account of the disability or death of the miner due to 
pneumoconiosis; and
    (2) On account of excess earnings under section 203 (b) through (l) 
of the Social Security Act; and
    (3) For failure to report earnings from work in employment and 
self-employment within the prescribed period of time; and
    (4) By reason of the fact that a claim for benefits from an 
additional beneficiary is filed, or that such a claim is effective for 
a month prior to the month of filing, or a dependent qualifies under 
this part or this chapter for an augmentation portion of a benefit of a 
miner or surviving spouse for a month for which another dependent has 
previously qualified for an augmentation.
    (c) With respect to claims filed between July 1 and December 31, 
1973, and paid for periods of eligibility occurring during such period, 
there shall be no retroactive adjustment of benefits paid in light of 
the amendments enacted by the Black Lung Benefits Reform Act of 1977 
insofar as such amendments affect events which cause a reduction in 
benefits.
    (d) An adjustment in a beneficiary's monthly benefit may be 
required because an overpayment or underpayment has been made to such 
beneficiary (see Secs. 725.540 through 725.546).
    (e) A suspension of a beneficiary's monthly benefits may be 
required when the Office has information indicating that reductions on 
account of excess earnings may reasonably be expected.
    (f) Monthly benefit rates are payable in multiples of 10 cents. Any 
monthly benefit rate which, after the applicable computations, 
augmentations, and reductions is not a multiple of 10 cents, is 
increased to the next higher multiple of 10 cents. Since a fraction of 
a cent is not a multiple of 10 cents, a benefit rate which contains 
such a fraction in the third decimal is raised to the next higher 
multiple of 10 cents.
    (g) Any individual entitled to a benefit, who is aware of any 
circumstances which could affect entitlement to benefits, eligibility 
for payment, or the amount of benefits, or result in the termination, 
suspension, or reduction of benefits, shall promptly report these 
circumstances to the Office. The Office may at any time require an 
individual receiving, or claiming entitlement to, benefits, either on 
his or her own behalf or on behalf of another, to submit a written 
statement giving pertinent information bearing upon the issue of 
whether or not an event has occurred which would cause such benefit to 
be terminated, or which would subject such benefit to reductions or 
suspension under the provisions of the Act. The failure of an 
individual to submit any such report or statement, properly executed, 
to the Office shall

[[Page 3417]]

subject such benefit to reductions, suspension, or termination as the 
case may be.


Sec. 725.534  Reduction of State benefits.

    No benefits under section 415 of part B of title IV of the Act 
shall be payable to the residents of a State which, after December 31, 
1969, reduces the benefits payable to persons eligible to receive 
benefits under section 415 of the Act under State laws applicable to 
its general work force with regard to workers' compensation (including 
compensation for occupational disease), unemployment compensation, or 
disability insurance benefits which are funded in whole or in part out 
of employer contributions.


Sec. 725.535  Reductions; receipt of State or Federal benefit.

    (a) As used in this section the term ``State or Federal benefit'' 
means a payment to an individual on account of total or partial 
disability or death due to pneumoconiosis only under State or Federal 
laws relating to workers' compensation. With respect to a claim for 
which benefits are payable for any month between July 1 and December 
31, 1973, ``State benefit'' means a payment to a beneficiary made on 
account of disability or death due to pneumoconiosis under State laws 
relating to workers' compensation (including compensation for 
occupational disease), unemployment compensation, or disability 
insurance.
    (b) Benefit payments to a beneficiary for any month are reduced 
(but not below zero) by an amount equal to any payments of State or 
Federal benefits received by such beneficiary for such month.
    (c) Where a State or Federal benefit is paid periodically but not 
monthly, or in a lump sum as a commutation of or a substitution for 
periodic benefits, the reduction under this section is made at such 
time or times and in such amounts as the Office determines will 
approximate as nearly as practicable the reduction required under 
paragraph (b) of this section. In making such a determination, a weekly 
State or Federal benefit is multiplied by 4\1/3\ and a biweekly benefit 
is multiplied by 2\1/6\ to ascertain the monthly equivalent for 
reduction purposes.
    (d) Amounts paid or incurred or to be incurred by the individual 
for medical, legal, or related expenses in connection with this claim 
for State or Federal benefits (defined in paragraph (a) of this 
section) are excluded in computing the reduction under paragraph (b) of 
this section, to the extent that they are consistent with State or 
Federal Law. Such medical, legal, or related expenses may be evidenced 
by the State or Federal benefit awards, compromise agreement, or court 
order in the State or Federal benefit proceedings, or by such other 
evidence as the Office may require. Such other evidence may consist of:
    (1) A detailed statement by the individual's attorney, physician, 
or the employer's insurance carrier; or
    (2) Bills, receipts, or canceled checks; or
    (3) Other evidence indicating the amount of such expenses; or
    (4) Any combination of the foregoing evidence from which the amount 
of such expenses may be determinable. Such expenses shall not be 
excluded unless established by evidence as required by the Office.


Sec. 725.536  Reductions; excess earnings.

    In the case of a surviving parent, brother, or sister, whose claim 
was filed at any time, or of a miner whose claim was filed on or after 
January 1, 1982, benefit payments are reduced as appropriate by an 
amount equal to the deduction which would be made with respect to 
excess earnings under the provisions of sections 203 (b), (f), (g), 
(h), (j), and (l) of the Social Security Act (42 U.S.C. 403 (b), (f), 
(g), (h), (j), and (l)), as if such benefit payments were benefits 
payable under section 202 of the Social Security Act (42 U.S.C. 402) 
(see Secs. 404.428 through 404.456 of this title).


Sec. 725.537  Reductions; retroactive effect of an additional claim for 
benefits.

    Except as provided in Sec. 725.212(b), beginning with the month in 
which a person other than a miner files a claim and becomes entitled to 
benefits, the benefits of other persons entitled to benefits with 
respect to the same miner, are adjusted downward, if necessary, so that 
no more than the permissible amount of benefits (the maximum amount for 
the number of beneficiaries involved) will be paid.


Sec. 725.538  Reductions; effect of augmentation of benefits based on 
subsequent qualification of individual.

    (a) Ordinarily, a written request that the benefits of a miner or 
surviving spouse be augmented on account of a qualified dependent is 
made as part of the claim for benefits. However, it may also be made 
thereafter.
    (b) In the latter case, beginning with the month in which such a 
request is filed on account of a particular dependent and in which such 
dependent qualifies for augmentation purposes under this part, the 
augmented benefits attributable to other qualified dependents (with 
respect to the same miner or surviving spouse), if any, are adjusted 
downward, if necessary, so that the permissible amount of augmented 
benefits (the maximum amount for the number of dependents involved) 
will not be exceeded.
    (c) Where, based on the entitlement to benefits of a miner or 
surviving spouse, a dependent would have qualified for augmentation 
purposes for a prior month of such miner's or surviving spouse's 
entitlement had such request been filed in such prior month, such 
request is effective for such prior month. For any month before the 
month of filing such request, however, otherwise correct benefits 
previously certified by the Office may not be changed. Rather the 
amount of the augmented benefit attributable to the dependent filing 
such request in the later month is reduced for each month of the 
retroactive period to the extent that may be necessary. This means that 
for each month of the retroactive period, the amount payable to the 
dependent filing the later augmentation request is the difference, if 
any, between:
    (1) The total amount of augmented benefits certified for payment 
for other dependents for that month, and
    (2) The permissible amount of augmented benefits (the maximum 
amount for the number of dependents involved) payable for the month for 
all dependents, including the dependent filing later.


Sec. 725.539  More than one reduction event.

    If a reduction for receipt of State or Federal benefits and a 
reduction on account of excess earnings are chargeable to the same 
month, the benefit for such month is first reduced (but not below zero) 
by the amount of the State or Federal benefits, and the remainder of 
the benefit for such month, if any, is then reduced (but not below 
zero) by the amount of excess earnings chargeable to such month.

Overpayments; Underpayments


Sec. 725.540  Overpayments.

    (a) General. As used in this subpart, the term ``overpayment'' 
includes:
    (1) Payment where no amount is payable under this part;
    (2) Payment in excess of the amount payable under this part;
    (3) A payment under this part which has not been reduced by the 
amounts required by the Act (see Sec. 725.533);
    (4) A payment under this part made to a resident of a State whose 
residents are not entitled to benefits (see Secs. 725.402 and 725.403);

[[Page 3418]]

    (5) Payment resulting from failure to terminate benefits to an 
individual no longer entitled thereto;
    (6) Duplicate benefits paid to a claimant on account of concurrent 
eligibility under this part and parts 410 or 727 (see Sec. 725.4(d)) of 
this title or as provided in Sec. 725.309.
    (b) Overpaid beneficiary is living. If the beneficiary to whom an 
overpayment was made is living at the time of a determination of such 
overpayment, is entitled to benefits at the time of the overpayment, or 
at any time thereafter becomes so entitled, no benefit for any month is 
payable to such individual, except as provided in paragraph (c) of this 
section, until an amount equal to the amount of the overpayment has 
been withheld or refunded.
    (c) Adjustment by withholding part of a monthly benefit. Adjustment 
under paragraph (b) of this section may be effected by withholding a 
part of the monthly benefit payable to a beneficiary where it is 
determined that:
    (1) Withholding the full amount each month would deprive the 
beneficiary of income required for ordinary and necessary living 
expenses;
    (2) The overpayment was not caused by the beneficiary's 
intentionally false statement or representation, or willful concealment 
of, or deliberate failure to furnish, material information; and
    (3) Recoupment can be effected in an amount of not less than $10 a 
month and at a rate which would not unreasonably extend the period of 
adjustment.
    (d) Overpaid beneficiary dies before adjustment. If an overpaid 
beneficiary dies before adjustment is completed under the provisions of 
paragraph (b) of this section, recovery of the overpayment shall be 
effected through repayment by the estate of the deceased overpaid 
beneficiary, or by withholding of amounts due the estate of such 
deceased beneficiary, or both.


Sec. 725.541  Notice of waiver of adjustment or recovery of 
overpayment.

    Whenever a determination is made that more than the correct amount 
of payment has been made, notice of the provisions of section 204(b) of 
the Social Security Act regarding waiver of adjustment or recovery 
shall be sent to the overpaid individual, to any other individual 
against whom adjustment or recovery of the overpayment is to be 
effected, and to any operator or carrier which may be liable to such 
overpaid individual.


Sec. 725.542  When waiver of adjustment or recovery may be applied.

    There shall be no adjustment or recovery of an overpayment in any 
case where an incorrect payment has been made with respect to an 
individual:
    (a) Who is without fault, and where
    (b) Adjustment or recovery would either:
    (1) Defeat the purpose of title IV of the Act, or
    (2) Be against equity and good conscience.


Sec. 725.543  Standards for waiver of adjustment or recovery.

    The standards for determining the applicability of the criteria 
listed in Sec. 725.542 shall be the same as those applied by the Social 
Security Administration under Secs. 410.561 through 410.561h of this 
title.


Sec. 725.544  Collection and compromise of claims for overpayment.

    (a) General effect of the Federal Claims Collection Act of 1966. In 
accordance with the Federal Claims Collection Act of 1966 and 
applicable regulations, claims by the Office against an individual for 
recovery of an overpayment under this part not exceeding the sum of $ 
20,000, exclusive of interest, may be compromised, or collection 
suspended or terminated, where such individual or his or her estate 
does not have the present or prospective ability to pay the full amount 
of the claim within a reasonable time (see paragraph (c) of this 
section), or the cost of collection is likely to exceed the amount of 
recovery (see paragraph (d) of this section), except as provided under 
paragraph (b) of this section.
    (b) When there will be no compromise, suspension, or termination of 
collection of a claim for overpayment. (1) In any case where the 
overpaid individual is alive, a claim for overpayment will not be 
compromised, nor will there be suspension or termination of collection 
of the claim by the Office, if there is an indication of fraud, the 
filing of a false claim, or misrepresentation on the part of such 
individual or on the part of any other party having any interest in the 
claim.
    (2) In any case where the overpaid individual is deceased:
    (i) A claim for overpayment in excess of $5,000 will not be 
compromised, nor will there be suspension or termination of collection 
of the claim by the Office if there is an indication of fraud, the 
filing of a false claim, or misrepresentation on the part of such 
deceased individual; and
    (ii) A claim for overpayment, regardless of the amount, will not be 
compromised, nor will there be suspension or termination of collection 
of the claim by the Office if there is an indication that any person 
other than the deceased overpaid individual had a part in the 
fraudulent action which resulted in the overpayment.
    (c) Inability to pay claim for recovery of overpayment. In 
determining whether the overpaid individual is unable to pay a claim 
for recovery of an overpayment under this part, the Office shall 
consider the individual's age, health, present and potential income 
(including inheritance prospects), assets (e.g., real property, savings 
account), possible concealment or improper transfer of assets, and 
assets or income of such individual which may be available in enforced 
collection proceedings. The Office will also consider exemptions 
available to such individual under the pertinent State or Federal law 
in such proceedings. In the event the overpaid individual is deceased, 
the Office shall consider the available assets of the estate, taking 
into account any liens or superior claims against the estate.
    (d) Cost of collection or litigative probabilities. Where the 
probable costs of recovering an overpayment under this part would not 
justify enforced collection proceedings for the full amount of the 
claim, or where there is doubt concerning the Office's ability to 
establish its claim as well as the time which it will take to effect 
such collection, a compromise or settlement for less than the full 
amount may be considered.
    (e) Amount of compromise. The amount to be accepted in compromise 
of a claim for overpayment under this part shall bear a reasonable 
relationship to the amount which can be recovered by enforced 
collection proceedings, giving due consideration to the exemption 
available to the overpaid individual under State or Federal law and the 
time which collection will take.
    (f) Payment. Payment of the amount the Office has agreed to accept 
as a compromise in full settlement of a claim for recovery of an 
overpayment under this part shall be made within the time and in the 
manner set by the Office. A claim for the overpayment shall not be 
considered compromised or settled until the full payment of the 
compromised amount has been made within the time and manner set by the 
Office. Failure of the overpaid individual or his or her estate to make 
such payment as provided shall result in reinstatement of the full 
amount of the overpayment less any amounts paid prior to such default.

(Approved by the Office of Management and Budget under control 
number 1215-0144)


[[Page 3419]]


(Pub. L. No. 96-511)

Sec. 725.545   Underpayments.

    (a) General. As used in this subpart, the term ``underpayment'' 
includes a payment in an amount less than the amount of the benefit due 
for such month, and nonpayment where some amount of such benefits is 
payable.
    (b) Underpaid individual is living. If an individual to whom an 
underpayment was made is living, the deficit represented by such 
underpayment shall be paid to such individual either in a single 
payment (if he or she is not entitled to a monthly benefit or if a 
single payment is requested by the claimant in writing) or by 
increasing one or more monthly benefit payments to which such 
individual becomes entitled.
    (c) Underpaid individual dies before adjustment of underpayment. If 
an individual to whom an underpayment was made dies before receiving 
payment of the deficit or negotiating the check or checks representing 
payment of the deficit, such payment shall be distributed to the living 
person (or persons) in the highest order of priority as follows:
    (1) The deceased individual's surviving spouse who was either:
    (i) Living in the same household with the deceased individual at 
the time of such individual's death; or
    (ii) In the case of a deceased miner, entitled for the month of 
death to black lung benefits as his or her surviving spouse or 
surviving divorced spouse.
    (2) In the case of a deceased miner or spouse his or her child 
entitled to benefits as the surviving child of such miner or surviving 
spouse for the month in which such miner or spouse died (if more than 
one such child, in equal shares to each such child).
    (3) In the case of a deceased miner, his parent entitled to 
benefits as the surviving parent of such miner for the month in which 
such miner died (if more than one such parent, in equal shares to each 
such parent).
    (4) The surviving spouse of the deceased individual who does not 
qualify under paragraph (c)(1) of this section.
    (5) The child or children of the deceased individual who do not 
qualify under paragraph (c)(2) of this section (if more than one such 
child, in equal shares to each such child).
    (6) The parent or parents of the deceased individual who do not 
qualify under paragraph (c)(3) of this section (if more than one such 
parent, in equal shares to each such parent).
    (7) The legal representative of the estate of the deceased 
individual as defined in paragraph (e) of this section.
    (d) Deceased beneficiary. In the event that a person, who is 
otherwise qualified to receive payments as the result of a deficit 
caused by an underpayment under the provisions of paragraph (c) of this 
section, dies before receiving payment or before negotiating the check 
or checks representing such payment, his or her share of the 
underpayment shall be divided among the remaining living person(s) in 
the same order or priority. In the event that there is (are) no other 
such person(s), the underpayment shall be paid to the living person(s) 
in the next lower order of priority under paragraph (c) of this 
section.
    (e) Definition of legal representative. The term ``legal 
representative,'' for the purpose of qualifying for receipt of an 
underpayment, generally means the executor or the administrator of the 
estate of the deceased beneficiary. However, it may also include an 
individual, institution or organization acting on behalf of an 
unadministered estate, provided the person can give the Office good 
acquittance (as defined in paragraph (f) of this section). The 
following persons may qualify as legal representative for purposes of 
this section, provided they can give the Office good acquittance:
    (1) A person who qualifies under a State's ``small estate'' 
statute; or
    (2) A person resident in a foreign country who under the laws and 
customs of that country, has the right to receive assets of the estate; 
or
    (3) A public administrator; or
    (4) A person who has the authority under applicable law to collect 
the assets of the estate of the deceased beneficiary.
    (f) Definition of ``good acquittance.'' A person is considered to 
give the Office ``good acquittance'' when payment to that person will 
release the Office from further liability for such payment.


Sec. 725.546   Relation to provisions for reductions or increases.

    The amount of an overpayment or an underpayment is the difference 
between the amount to which the beneficiary was actually entitled and 
the amount paid. Overpayment and underpayment simultaneously 
outstanding against the same beneficiary shall first be adjusted 
against one another before adjustment pursuant to the other provisions 
of this subpart.


Sec. 725.547   Applicability of overpayment and underpayment provisions 
to operator or carrier.

    (a) The provisions of this subpart relating to overpayments and 
underpayments shall be applicable to overpayments and underpayments 
made by responsible operators or their insurance carriers, as 
appropriate.
    (b) No operator or carrier may recover, or make an adjustment of, 
an overpayment without prior application to, and approval by, the 
Office which shall exercise full supervisory authority over the 
recovery or adjustment of all overpayments.
    (c) In any case involving either overpayments or underpayments, the 
Office may take any necessary action, and district directors may issue 
appropriate orders to protect the rights of the parties.
    (d) Disputes arising out of orders so issued shall be resolved by 
the procedures set out in subpart F of this part.

Subpart I--Enforcement of Liability; Reports


Sec. 725.601   Enforcement generally.

    (a) The Act, together with certain incorporated provisions from the 
Longshoremen's and Harbor Workers' Compensation Act, contains a number 
of provisions which subject an operator or other employer, claimants 
and others to penalties for failure to comply with certain provisions 
of the Act, or failure to commence and continue prompt periodic 
payments to a beneficiary.
    (b) It is the policy and intent of the Department to vigorously 
enforce the provisions of this part through the use of the remedies 
provided by the Act. Accordingly, if an operator refuses to pay 
benefits with respect to a claim for which the operator has been 
adjudicated liable, the Director shall invoke and execute the lien on 
the property of the operator as described in Sec. 725.603. Enforcement 
of this lien shall be pursued in an appropriate U.S. district court. If 
the Director determines that the remedy provided by Sec. 725.603 may 
not be sufficient to guarantee the continued compliance with the terms 
of an award or awards against the operator, the Director shall in 
addition seek an injunction in the U.S. district court to prohibit 
future noncompliance by the operator and such other relief as the court 
considers appropriate (see Sec. 725.604). If an operator unlawfully 
suspends or terminates the payment of benefits to a claimant, the 
district director shall declare the award in default and proceed in 
accordance with Sec. 725.605. In all cases payments in

[[Page 3420]]

addition to compensation (see Sec. 725.607) and interest (see 
Sec. 725.608) shall be sought by the Director or awarded by the 
district director.
    (c) In certain instances the remedies provided by the Act are 
concurrent; that is, more than one remedy might be appropriate in any 
given case. In such a case, the Director shall select the remedy or 
remedies appropriate for the enforcement action. In making this 
selection, the Director shall consider the best interests of the 
claimant as well as those of the fund.


Sec. 725.602   Reimbursement of the fund.

    (a) In any case in which the fund has paid benefits, including 
medical benefits, on behalf of an operator or other employer which is 
determined liable therefore, or liable for a part thereof, such 
operator or other employer shall simultaneously with the first payment 
of benefits made to the beneficiary, reimburse the fund (with interest) 
for the full amount of all benefit payments made by the fund with 
respect to the claim.
    (b) In any case where benefit payments have been made by the fund, 
the fund shall be subrogated to the rights of the beneficiary. The 
Secretary of Labor may, as appropriate, exercise such subrogation 
rights.


Sec. 725.603   Payments by the fund on behalf of an operator; liens.

    (a) If an amount is paid out of the fund to an individual entitled 
to benefits under this part or part 727 of this subchapter (see 
Sec. 725.4(d)) on behalf of an operator or other employer which is or 
was required to pay or secure the payment of all or a portion of such 
amount (see Sec. 725.522), the operator or other employer shall be 
liable to the United States for repayment to the fund of the amount of 
benefits properly attributable to such operator or other employer.
    (b) If an operator or other employer liable to the fund refuses to 
pay, after demand, the amount of such liability, there shall be a lien 
in favor of the United States upon all property and rights to property, 
whether real or personal, belonging to such operator or other employer. 
The lien arises on the date on which such liability is finally 
determined, and continues until it is satisfied or becomes 
unenforceable by reason of lapse of time.
    (c)(1) Except as otherwise provided under this section, the 
priority of the lien shall be determined in the same manner as under 
section 6323 of the Internal Revenue Code of 1954.
    (2) In the case of a bankruptcy or insolvency proceeding, the lien 
imposed under this section shall be treated in the same manner as a 
lien for taxes due and owing to the United States for purposes of the 
Bankruptcy Act or section 3466 of the Revised Statutes (31 U.S.C. 191).
    (3) For purposes of applying section 6323(a) of the Internal 
Revenue Code of 1954 to determine the priority between the lien imposed 
under this section and the Federal tax lien, each lien shall be treated 
as a judgment lien arising as of the time notice of such lien is filed.
    (4) For purposes of the section, notice of the lien imposed 
hereunder shall be filed in the same manner as under section 6323(f) 
(disregarding paragraph (4) thereof) and (g) of the Internal Revenue 
Code of 1954.
    (5) In any case where there has been a refusal or neglect to pay 
the liability imposed under this section, the Secretary of Labor may 
bring a civil action in a district court of the United States to 
enforce the lien of the United States under this section with respect 
to such liability or to subject any property, of whatever nature, of 
the operator, or in which it has any right, title, or interest, to the 
payment of such liability.
    (6) The liability imposed by this paragraph may be collected at a 
proceeding in court if the proceeding is commenced within 6 years after 
the date upon which the liability was finally determined, or prior to 
the expiration of any period for collection agreed upon in writing by 
the operator and the United States before the expiration of such 6-year 
period. This period of limitation shall be suspended for any period 
during which the assets of the operator are in the custody or control 
of any court of the United States, or of any State, or the District of 
Columbia, and for 6 months thereafter, and for any period during which 
the operator is outside the United States if such period of absence is 
for a continuous period of at least 6 months.


Sec. 725.604  Enforcement of final awards.

    Notwithstanding the provisions of Sec. 725.603, if an operator or 
other employer or its officers or agents fails to comply with an order 
awarding benefits that has become final, any beneficiary of such award 
or the district director may apply for the enforcement of the order to 
the Federal district court for the judicial district in which the 
injury occurred (or to the U.S. District Court for the District of 
Columbia if the injury occurred in the District). If the court 
determines that the order was made and served in accordance with law, 
and that such operator or other employer or its officers or agents have 
failed to comply therewith, the court shall enforce obedience to the 
order by writ of injunction or by other proper process, mandatory or 
otherwise, to enjoin upon such operator or other employer and its 
officers or agents compliance with the order.


Sec. 725.605  Defaults.

    (a) Except as is otherwise provided in this part, no suspension, 
termination or other failure to pay benefits awarded to a claimant is 
permitted. If an employer found liable for the payment of such benefits 
fails to make such payments within 30 days after any date on which such 
benefits are due and payable, the person to whom such benefits are 
payable may, within one year after such default, make application to 
the district director for a supplementary order declaring the amount of 
the default.
    (b) If after investigation, notice and hearing as provided in 
subparts E and F of this part, a default is found, the district 
director or the administrative law judge, if a hearing is requested, 
shall issue a supplementary order declaring the amount of the default, 
if any. In cases where a lump-sum award has been made, if the payment 
in default is an installment, the district director or administrative 
law judge, may, in his or her discretion, declare the whole of the 
award as the amount in default. The applicant may file a certified copy 
of such supplementary order with the clerk of the Federal district 
court for the judicial district in which the operator has its principal 
place of business or maintains an office or for the judicial district 
in which the injury occurred. In case such principal place of business 
or office is in the District of Columbia, a copy of such supplementary 
order may be filed with the clerk of the U.S. District Court for the 
District of Columbia. Such supplementary order shall be final and the 
court shall, upon the filing of the copy, enter judgment for the amount 
declared in default by the supplementary order if such supplementary 
order is in accordance with law. Review of the judgment may be had as 
in civil suits for damages at common law. Final proceedings to execute 
the judgment may be had by writ of execution in the form used by the 
court in suits at common law in actions of assumpsit. No fee shall be 
required for filing the supplementary order nor for entry of judgment 
thereon, and the applicant shall not be liable for costs in a 
proceeding for review of the judgment unless the court shall otherwise 
direct. The court shall modify such judgment to conform to any later 
benefits order upon presentation of a certified copy thereof to the 
court.

[[Page 3421]]

    (c) In cases where judgment cannot be satisfied by reason of the 
employer's insolvency or other circumstances precluding payment, the 
district director shall make payment from the fund, and in addition, 
provide any necessary medical, surgical, and other treatment required 
by subpart J of this part. A defaulting employer shall be liable to the 
fund for payment of the amounts paid by the fund under this section; 
and for the purpose of enforcing this liability, the fund shall be 
subrogated to all the rights of the person receiving such payments or 
benefits.


Sec. 725.606  Security for the payment of benefits.

    (a) Following the issuance of an effective order by a district 
director (see Sec. 725.418), administrative law judge (see 
Sec. 725.479), Benefits Review Board, or court that requires the 
payment of benefits by an operator that has failed to secure the 
payment of benefits in accordance with section 423 of the Act and 
Sec. 726.4 of this subchapter, or by a coal mine construction or 
transportation employer, the Director may request that the operator 
secure the payment of all benefits ultimately payable on the claim. 
Such operator or other employer shall thereafter immediately secure the 
payment of benefits in accordance with the provisions of this section, 
and provide proof of such security to the Director. Such security may 
take the form of an indemnity bond, a deposit of cash or negotiable 
securities in compliance with Secs. 726.106(c) and 726.107 of this 
subchapter, or any other form acceptable to the Director.
    (b) The amount of security initially required by this section shall 
be determined as follows:
    (1) In a case involving an operator subject to section 423 of the 
Act and Sec. 726.4 of this subchapter, the amount of the security shall 
not be less than $175,000, and may be a higher amount as determined by 
the Director, taking into account the life expectancies of the claimant 
and any dependents using the most recent life expectancy tables 
published by the Social Security Administration; or
    (2) In a case involving a coal mine construction or transportation 
employer, the amount of the security shall be determined by the 
Director, taking into account the life expectancies of the claimant and 
any dependents using the most recent life expectancy tables published 
by the Social Security Administration.
    (c) If the operator or other employer fails to provide proof of 
such security to the Director within 30 days of its receipt of the 
Director's request to secure the payment of benefits issued under 
paragraph (a), the appropriate adjudication officer shall issue an 
order requiring the operator or other employer to make a deposit of 
negotiable securities with a Federal Reserve Bank in the amount 
required by paragraph (a). Such securities shall comply with the 
requirements of Secs. 726.106(c) and 726.107 of this subchapter. In a 
case in which the effective order was issued by a district director, 
the district director shall be considered the appropriate adjudication 
officer. In any other case, the administrative law judge who issued the 
most recent decision in the case, or such other administrative law 
judge as the Chief Administrative Law Judge shall designate, shall be 
considered the appropriate adjudication officer, and shall issue an 
order under this paragraph on motion of the Director. The 
administrative law judge shall have jurisdiction to issue an order 
under this paragraph notwithstanding the pendency of an appeal of the 
award of benefits with the Benefits Review Board or court.
    (d) An order issued under this section shall be considered 
effective when issued. Disputes regarding such orders shall be resolved 
in accordance with subpart F of this part.
    (e) Notwithstanding any further review of the order in accordance 
with subpart F of this part, if an operator or other employer subject 
to an order issued under this section fails to comply with such order, 
the appropriate adjudication officer shall certify such non-compliance 
to the appropriate United States district court in accordance with 
Sec. 725.351(c).
    (f) Security posted in accordance with this section may be used to 
make payment of benefits that become due with respect to the claim in 
accordance with Sec. 725.502. In the event that either the order 
awarding compensation or the order issued under this section is vacated 
or reversed, the operator or other employer may apply to the 
appropriate adjudication officer for an order authorizing the return of 
any amounts deposited with the United States Treasurer and not yet 
disbursed, and such application shall be granted. If at any time the 
Director determines that additional security is required beyond that 
initially required by paragraph (b), he may request the operator or 
other employer to increase the amount. Such request shall be treated as 
if it were issued under paragraph (a) of this section.
    (g) If a coal mine construction or transportation employer fails to 
comply with an order issued under paragraph (c), and such employer is a 
corporation, the provisions of Sec. 725.609 shall be applicable to the 
president, secretary, and treasurer of such employer.


Sec. 725.607  Payments in addition to compensation.

    (a) If any benefits payable under the terms of an award by a 
district director (Sec. 725.419(d)), a decision and order filed and 
served by an administrative law judge (Sec. 725.478), or a decision 
filed by the Board or a U.S. court of appeals, are not paid by an 
operator or other employer ordered to make such payments within 10 days 
after such payments become due, there shall be added to such unpaid 
benefits an amount equal to 20 percent thereof, which shall be paid to 
the claimant at the same time as, but in addition to, such benefits, 
unless review of the order making such award is sought as provided in 
section 21 of the LHWCA and an order staying payments has been issued.
    (b) If, on account of an operator's or other employer's failure to 
pay benefits as provided in paragraph (a) of this section, benefit 
payments are made by the fund, the eligible claimant shall nevertheless 
be entitled to receive such additional compensation to which he or she 
may be eligible under paragraph (a) of this section, with respect to 
all amounts paid by the fund on behalf of such operator or other 
employer.
    (c) The fund shall not be liable for payments in addition to 
compensation under any circumstances.


Sec. 725.608  Interest.

    (a)(1) In any case in which an operator fails to pay benefits that 
are due (Sec. 725.502), the beneficiary shall also be entitled to 
simple annual interest, computed from the date on which the benefits 
were due. The interest shall be computed through the date on which the 
operator paid the benefits, except that the beneficiary shall not be 
entitled to interest for any period following the date on which the 
beneficiary received payment of any benefits from the fund pursuant to 
Sec. 725.522.
    (2) In any case in which an operator is liable for the payment of 
retroactive benefits, the beneficiary shall also be entitled to simple 
annual interest on such benefits, computed from 30 days after the date 
of the first determination that such an award should be made. The first 
determination that such an award should be made may be a district 
director's initial determination of entitlement, an award made by an 
administrative law judge or a decision by the Board or a court, 
whichever is the first such determination of entitlement made upon the 
claim.

[[Page 3422]]

    (3) In any case in which an operator is liable for the payment of 
additional compensation (Sec. 725.607), the beneficiary shall also be 
entitled to simple annual interest computed from the date upon which 
the beneficiary's right to additional compensation first arose.
    (4) In any case in which an operator is liable for the payment of 
medical benefits, the beneficiary or medical provider to whom such 
benefits are owed shall also be entitled to simple annual interest, 
computed from the date upon which the services were rendered, or from 
30 days after the date of the first determination that the miner is 
generally entitled to medical benefits, whichever is later. The first 
determination that the miner is generally entitled to medical benefits 
may be a district director's initial determination of entitlement, an 
award made by an administrative law judge or a decision by the Board or 
a court, whichever is the first such determination of general 
entitlement made upon the claim. The interest shall be computed through 
the date on which the operator paid the benefits, except that the 
beneficiary shall not be entitled to interest for any period following 
the date on which the beneficiary received payment of any benefits from 
the fund pursuant to Sec. 725.522 or subpart I of this part.
    (b) If an operator or other employer fails or refuses to pay any or 
all benefits due pursuant to an award of benefits or an initial 
determination of eligibility made by the district director and the fund 
undertakes such payments, such operator or other employer shall be 
liable to the fund for simple annual interest on all payments made by 
the fund for which such operator is determined liable, computed from 
the first date on which such benefits are paid by the fund, in addition 
to such operator's liability to the fund, as is otherwise provided in 
this part. Interest payments owed pursuant to this paragraph shall be 
paid directly to the fund.
    (c) In any case in which an operator is liable for the payment of 
an attorney's fee pursuant to Sec. 725.367, and the attorney's fee is 
payable because the award of benefits has become final, the attorney 
shall also be entitled to simple annual interest, computed from the 
date on which the attorney's fee was awarded. The interest shall be 
computed through the date on which the operator paid the attorney's 
fee.
    (d) The rates of interest applicable to paragraphs (a), (b), and 
(c) of this section shall be computed as follows:
    (1) For all amounts outstanding prior to January 1, 1982, the rate 
shall be 6% simple annual interest;
    (2) For all amounts outstanding for any period during calendar year 
1982, the rate shall be 15% simple annual interest; and
    (3) For all amounts outstanding during any period after calendar 
year 1982, the rate shall be simple annual interest at the rate 
established by section 6621 of the Internal Revenue Code of 1954 which 
is in effect for such period.
    (e) The fund shall not be liable for the payment of interest under 
any circumstances, other than the payment of interest on advances from 
the United States Treasury as provided by section 9501(c) of the 
Internal Revenue Code of 1954.


Sec. 725.609  Enforcement against other persons.

    In any case in which an award of benefits creates obligations on 
the part of an operator or insurer that may be enforced under the 
provisions of this subpart, such obligations may also be enforced, in 
the discretion of the Secretary or district director, as follows:
    (a) In a case in which the operator is a sole proprietorship or 
partnership, against any person who owned, or was a partner in, such 
operator during any period commencing on or after the date on which the 
miner was last employed by the operator;
    (b) In a case in which the operator is a corporation that failed to 
secure its liability for benefits in accordance with section 423 of the 
Act and Sec. 726.4, and the operator has not secured its liability for 
the claim in accordance with Sec. 725.606, against any person who 
served as the president, secretary, or treasurer of such corporation 
during any period commencing on or after the date on which the miner 
was last employed by the operator;
    (c) In a case in which the operator is no longer capable of 
assuming its liability for the payment of benefits (Sec. 725.494(e)), 
against any operator which became a successor operator with respect to 
the liable operator (Sec. 725.492) after the date on which the claim 
was filed, beginning with the most recent such successor operator;
    (d) In a case in which the operator is no longer capable of 
assuming its liability for the payment of benefits (Sec. 725.494(e)), 
and such operator was a subsidiary of a parent company or a product of 
a joint venture, or was substantially owned or controlled by another 
business entity, against such parent entity, any member of such joint 
venture, or such controlling business entity; or
    (e) Against any other person who has assumed or succeeded to the 
obligations of the operator or insurer by operation of any state or 
federal law, or by any other means.


Sec. 725.620  Failure to secure benefits; other penalties.

    (a) If an operator fails to discharge its insurance obligations 
under the Act, the provisions of subpart D of part 726 shall apply.
    (b) Any employer who knowingly transfers, sells, encumbers, 
assigns, or in any manner disposes of, conceals, secrets, or destroys 
any property belonging to such employer, after one of its employees has 
been injured within the purview of the Act, and with intent to avoid 
the payment of benefits under the Act to such miner or his or her 
dependents, shall be guilty of a misdemeanor and, upon conviction 
thereof, shall be punished by a fine of not more than $1,000, or by 
imprisonment for not more than one year, or by both. In any case where 
such employer is a corporation, the president, secretary, and treasurer 
thereof shall be also severally liable for such penalty or imprisonment 
as well as jointly liable with such corporation for such fine.
    (c) No agreement by a miner to pay any portion of a premium paid to 
a carrier by such miner's employer or to contribute to a benefit fund 
or department maintained by such employer for the purpose of providing 
benefits or medical services and supplies as required by this part 
shall be valid; and any employer who makes a deduction for such purpose 
from the pay of a miner entitled to benefits under the Act shall be 
guilty of a misdemeanor and upon conviction thereof shall be punished 
by a fine of not more than $1,000.
    (d) No agreement by a miner to waive his or her right to benefits 
under the Act and the provisions of this part shall be valid.
    (e) This section shall not affect any other liability of the 
employer under this part.


Sec. 725.621  Reports.

    (a) Upon making the first payment of benefits and upon suspension, 
reduction, or increase of payments, the operator or other employer 
responsible for making payments shall immediately notify the district 
director of the action taken, in accordance with a form prescribed by 
the Office.
    (b) Within 16 days after final payment of benefits has been made by 
an employer, such employer shall so notify the district director, in 
accordance with a form prescribed by the Office, stating

[[Page 3423]]

that such final payment, has been made, the total amount of benefits 
paid, the name of the beneficiary, and such other information as the 
Office deems pertinent.
    (c) The Director may from time to time prescribe such additional 
reports to be made by operators, other employers, or carriers as the 
Director may consider necessary for the efficient administration of the 
Act.
    (d) Any employer who fails or refuses to file any report required 
of such employer under this section shall be subject to a civil penalty 
not to exceed $500 for each failure or refusal, which penalty shall be 
determined in accordance with the procedures set forth in subpart D of 
part 726, as appropriate. The maximum penalty applicable to any 
violation of this paragraph that takes place after [effective date of 
the final rule] shall be $550.
    (e) No request for information or response to such request shall be 
considered a report for purposes of this section or the Act, unless it 
is so designated by the Director or by this section.

(Approved by the Office of Management and Budget under control 
number 1215-0064)

(Pub. L. No. 96-511)

Subpart J--Medical Benefits and Vocational Rehabilitation


Sec. 725.701  Availability of medical benefits.

    (a) A miner who is determined to be eligible for benefits under 
this part or part 727 of this subchapter (see Sec. 725.4(d)) is 
entitled to medical benefits as set forth in this subpart as of the 
date of his or her claim, but in no event before January 1, 1974. No 
medical benefits shall be provided to the survivor or dependent of a 
miner under this part.
    (b) A responsible operator, other employer, or where there is 
neither, the fund, shall furnish a miner entitled to benefits under 
this part with such medical, surgical, and other attendance and 
treatment, nursing and hospital services, medicine and apparatus, and 
any other medical service or supply, for such periods as the nature of 
the miner's pneumoconiosis and ancillary pulmonary conditions and 
disability require.
    (c) The medical benefits referred to in paragraphs (a) and (b) of 
this section shall include palliative measures useful only to prevent 
pain or discomfort associated with the miner's pneumoconiosis or 
attendant disability.
    (d) The costs recoverable under this subpart shall include the 
reasonable cost of travel necessary for medical treatment (to be 
determined in accordance with prevailing United States government 
mileage rates) and the reasonable documented cost to the miner or 
medical provider incurred in communicating with the employer, carrier, 
or district director on matters connected with medical benefits.
    (e) If a miner receives treatment, as described in this section, 
for any pulmonary disorder, there shall be a rebuttable presumption 
that the disorder is caused or aggravated by the miner's 
pneumoconiosis. The presumption may be rebutted by evidence that the 
specific disorder being treated is neither related to, nor aggravated 
by, the miner's pneumoconiosis. The party liable for the payment of 
benefits shall bear the burden to rebut the presumption (see 
Sec. 725.103).
    (f) Evidence that the miner does not have pneumoconiosis or is not 
totally disabled by pneumoconiosis arising out of coal mine employment 
is insufficient to establish any fact concerning a miner's entitlement 
to medical benefits under this subpart.


Sec. 725.702  Claims for medical benefits only under section 11 of the 
Reform Act.

    (a) Section 11 of the Reform Act directs the Secretary of Health, 
Education and Welfare to notify each miner receiving benefits under 
part B of title IV of the Act that he or she may file a claim for 
medical treatment benefits described in this subpart. Section 
725.308(b) of this subpart provides that a claim for medical treatment 
benefits shall be filed on or before December 31, 1980, unless the 
period is enlarged for good cause shown. This section sets forth the 
rules governing the processing, adjudication, and payment of claims 
filed under section 11.
    (b) (1) A claim filed pursuant to the notice described in paragraph 
(a) of this section shall be considered a claim for medical benefits 
only, and shall be filed, processed, and adjudicated in accordance with 
the provisions of this part, except as provided in this section. While 
a claim for medical benefits must be treated as any other claim filed 
under part C of title IV of the Act, the Department shall accept the 
Social Security Administration's finding of entitlement as its initial 
determination.
    (2) In the case of a part B beneficiary whose coal mine employment 
terminated before January 1, 1970, the Secretary shall make an 
immediate award of medical benefits. Where the part B beneficiary's 
coal mine employment terminated on or after January 1, 1970, the 
Secretary shall immediately authorize the payment of medical benefits 
and thereafter inform the responsible operator, if any, of the 
operator's right to contest the claimant's entitlement for medical 
benefits.
    (c) A miner on whose behalf a claim is filed under this section 
(see Sec. 725.301) must have been alive on March 1, 1978, in order for 
the claim to be considered.
    (d) The criteria contained in subpart C of part 727 of this 
subchapter (see Sec. 725.4(d)) are applicable to claims for medical 
benefits filed under this section.
    (e) No determination made with respect to a claim filed under this 
section shall affect any determination previously made by the Social 
Security Administration. The Social Security Administration may, 
however, reopen a previously approved claim if the conditions set forth 
in Sec. 410.672(c) of this chapter are present. These conditions are 
generally limited to fraud or concealment.
    (f) If medical benefits are awarded under this section, such 
benefits shall be payable by a responsible coal mine operator (see 
subpart G of this part), if the miner's last employment occurred on or 
after January 1, 1970, and in all other cases by the fund. An operator 
which may be required to provide medical treatment benefits to a miner 
under this section shall have the right to participate in the 
adjudication of the claim as is otherwise provided in this part.
    (g) Any miner whose coal mine employment terminated after January 
1, 1970, may be required to submit to a medical examination requested 
by an identified operator. The unreasonable refusal to submit to such 
an examination shall have the same consequences as are provided under 
Sec. 725.414.
    (h) If a miner is determined eligible for medical benefits in 
accordance with this section, such benefits shall be provided from the 
date of filing, except that such benefits may also include payments for 
any unreimbursed medical treatment costs incurred personally by such 
miner during the period from January 1, 1974, to the date of filing 
which are attributable to medical care required as a result of the 
miner's total disability due to pneumoconiosis. No reimbursement for 
health insurance premiums, taxes attributable to any public health 
insurance coverage, or other deduction or payments made for the purpose 
of securing third party liability for medical care costs is authorized 
by this section. If a miner seeks reimbursement for medical care costs 
personally incurred before the filing of a claim under this section, 
the district director shall require

[[Page 3424]]

documented proof of the nature of the medical service provided, the 
identity of the medical provider, the cost of the service, and the fact 
that the cost was paid by the miner, before reimbursement for such cost 
may be awarded.


Sec. 725.703  Physician defined.

    The term ``physician'' includes only doctors of medicine (MD) and 
osteopathic practitioners within the scope of their practices as 
defined by State law. No treatment or medical services performed by any 
other practitioner of the healing arts is authorized by this part, 
unless such treatment or service is authorized and supervised both by a 
physician as defined in this section and the district director.


Sec. 725.704  Notification of right to medical benefits; authorization 
of treatment.

    (a) Upon notification to a miner of such miner's entitlement to 
benefits, the Office shall provide the miner with a list of authorized 
treating physicians and medical facilities in the area of the miner's 
residence. The miner may select a physician from this list or may 
select another physician with approval of the Office. Where emergency 
services are necessary and appropriate, authorization by the Office 
shall not be required.
    (b) The Office may, on its own initiative, or at the request of a 
responsible operator, order a change of physicians or facilities, but 
only where it has been determined that the change is desirable or 
necessary in the best interest of the miner. The miner may change 
physicians or facilities subject to the approval of the Office.
    (c) If adequate treatment cannot be obtained in the area of the 
claimant's residence, the Office may authorize the use of physicians or 
medical facilities outside such area as well as reimbursement for 
travel expenses and overnight accommodations.


Sec. 725.705  Arrangements for medical care.

    (a) Operator liability. If an operator has been determined liable 
for the payment of benefits to a miner, the Office shall notify such 
operator or insurer of the names, addresses, and telephone numbers of 
the authorized providers of medical benefits chosen by an entitled 
miner, and shall require the operator or insurer to:
    (1) Notify the miner and the providers chosen that such operator 
will be responsible for the cost of medical services provided to the 
miner on account of the miner's total disability due to pneumoconiosis;
    (2) Designate a person or persons with decisionmaking authority 
with whom the Office, the miner and authorized providers may 
communicate on matters involving medical benefits provided under this 
subpart and notify the Office, miner and providers of such designation;
    (3) Make arrangements for the direct reimbursement of providers for 
their services.
    (b) Fund liability. If there is no operator found liable for the 
payment of benefits, the Office shall make necessary arrangements to 
provide medical care to the miner, notify the miner and medical care 
facility selected of the liability of the fund, designate a person or 
persons with whom the miner or provider may communicate on matters 
relating to medical care, and make arrangements for the direct 
reimbursement of the medical provider.


Sec. 725.706  Authorization to provide medical services.

    (a) Except as provided in paragraph (b) of this section, medical 
services from an authorized provider which are payable under 
Sec. 725.701 shall not require prior approval of the Office or the 
responsible operator.
    (b) Except where emergency treatment is required, prior approval of 
the Office or the responsible operator shall be obtained before any 
hospitalization or surgery, or before ordering an apparatus for 
treatment where the purchase price exceeds $300. A request for approval 
of non-emergency hospitalization or surgery shall be acted upon 
expeditiously, and approval or disapproval will be given by telephone 
if a written response cannot be given within 7 days following the 
request. No employee of the Department of Labor, other than a district 
director or the Chief, Branch of Medical Analysis and Services, DCMWC, 
is authorized to approve a request for hospitalization or surgery by 
telephone.
    (c) Payment for medical services, treatment, or an apparatus shall 
be made at no more than the rate prevailing in the community in which 
the providing physician, medical facility or supplier is located.


Sec. 725.707  Reports of physicians and supervision of medical care.

    (a) Within 30 days following the first medical or surgical 
treatment provided under Sec. 725.701, the treating physician or 
facility shall furnish to the Office and the responsible operator, if 
any, a report of such treatment.
    (b) In order to permit continuing supervision of the medical care 
provided to the miner with respect to the necessity, character and 
sufficiency of any medical care furnished or to be furnished, the 
treating physician, facility, employer or carrier shall provide such 
reports in addition to those required by paragraph (a) of this section 
as the Office may from time to time require. Within the discretion of 
the district director, payment may be refused to any medical provider 
who fails to submit any report required by this section.


Sec. 725.708  Disputes concerning medical benefits.

    (a) Whenever a dispute develops concerning medical services under 
this part, the district director shall attempt to informally resolve 
such dispute. In this regard the district director may, on his or her 
own initiative or at the request of the responsible operator order the 
claimant to submit to an examination by a physician selected by the 
district director.
    (b) If no informal resolution is accomplished, the district 
director shall refer the case to the Office of Administrative Law 
Judges for hearing in accordance with this part. Any such hearing shall 
be scheduled at the earliest possible time and shall take precedence 
over all other requests for hearing except for prior requests for 
hearing arising under this section and as provided by Sec. 727.405 of 
this subchapter (see Sec. 725.4(d)). During the pendency of such 
adjudication, the Director may order the payment of medical benefits 
prior to final adjudication under the same conditions applicable to 
benefits awarded under Sec. 725.522.
    (c) In the development or adjudication of a dispute over medical 
benefits, the adjudication officer is authorized to take whatever 
action may be necessary to protect the health of a totally disabled 
miner.
    (d) Any interested medical provider may, if appropriate, be made a 
party to a dispute over medical benefits.


Sec. 725.710  Objective of vocational rehabilitation.

    The objective of vocational rehabilitation is the return of a miner 
who is totally disabled for work in or around a coal mine and who is 
unable to utilize those skills which were employed in the miner's coal 
mine employment to gainful employment commensurate with such miner's 
physical impairment. This objective may be achieved through a program 
of re-evaluation and redirection of the miner's abilities, or 
retraining in another occupation, and selective job placement 
assistance.

[[Page 3425]]

Sec. 725.711  Requests for referral to vocational rehabilitation 
assistance.

    Each miner who has been determined entitled to receive benefits 
under part C of title IV of the Act shall be informed by the OWCP of 
the availability and advisability of vocational rehabilitation 
services. If such miner chooses to avail himself or herself of 
vocational rehabilitation, his or her request shall be processed and 
referred by OWCP vocational rehabilitation advisors pursuant to the 
provisions of Secs. 702.501 through 702.508 of this chapter as is 
appropriate.
    5. Part 726 is proposed to be revised as follows:

PART 726--BLACK LUNG BENEFITS; REQUIREMENTS FOR COAL MINE 
OPERATOR'S INSURANCE

Subpart A--General

Sec.
726.1  Statutory insurance requirements for coal mine operators.
726.2  Purpose and scope of this part.
726.3  Relationship of this part to other parts in this subchapter.
726.4  Who must obtain insurance coverage.
726.5  Effective date of insurance coverage.
726.6  The Office of Workers' Compensation Programs.
726.7  Forms, submission of information.
726.8  Definitions.

Subpart B--Authorization of Self-Insurers

726.101  Who may be authorized to self-insure.
726.102  Application for authority to become a self-insurer; how 
filed; information to be submitted.
726.103  Application for authority to self-insure; effect of 
regulations contained in this part.
726.104  Action by the Office upon application of operator.
726.105  Fixing the amount of security.
726.106  Type of security.
726.107  Deposits of negotiable securities with Federal Reserve 
banks or the Treasurer of the United States; authority to sell such 
securities; interest thereon.
726.108  Withdrawal of negotiable securities.
726.109  Increase or reduction in the amount of security.
726.110  Filing of agreement and undertaking.
726.111  Notice of authorization to self-insure.
726.112  Reports required of self-insurer; examination of accounts 
of self-insurer.
726.113  Disclosure of confidential information.
726.114  Period of authorization as self-insurer; reauthorization.
726.115  Revocation of authorization to self-insure.

Subpart C--Insurance Contracts

726.201  Insurance contracts--generally.
726.202  Who may underwrite an operator's liability.
726.203  Federal Coal Mine Health and Safety Act endorsement.
726.204 Statutory policy provisions.
726.205  Other forms of endorsement and policies.
726.206  Terms of policies.
726.207  Discharge by the carrier of obligations and duties of 
operator.

Reports by Carrier

726.208  Report by carrier of issuance of policy or endorsement.
726.209  Report; by whom sent.
726.210  Agreement to be bound by report.
726.211  Name of one employer only shall be given in each report.
726.212 Notice of cancellation.
726.213  Reports by carriers concerning the payment of benefits.

Subpart D--Civil Money Penalties

726.300  Purpose and Scope.
726.301  Definitions.
726.302  Determination of penalty.
726.303  Notification; Investigation.
726.304  Notice of initial assessment.
726.305  Contents of notice.
726.306  Finality of administrative assessment.
726.307  Form of notice of contest and request for hearing.
726.308  Service and computation of time.
726.309  Referral to the Office of Administrative Law Judges.
726.310  Appointment of Administrative Law Judge and notification of 
hearing date.
726.311  Evidence.
726.312  Burdens of proof.
726.313  Decision and Order of Administrative Law Judge.
726.314  Review by the Secretary.
726.315  Contents.
726.316  Filing and Service.
726.317  Discretionary Review.
726.318  Final decision of the Secretary.
726.319  Retention of official record.
726.320  Collection and recovery of penalty.

    Authority: 5 U.S.C. 301, Reorganization Plan No. 6 of 1950, 15 
FR 3174, 30 U.S.C. 901 et seq., 902(f), 925, 932, 933, 934, 936, 
945; 33 U.S.C. 901 et seq., Secretary's Order 7-87, 52 FR 48466, 
Employment Standards Order No. 90-02.

Subpart A--General


Sec. 726.1  Statutory insurance requirements for coal mine operators.

    Section 423 of title IV of the Federal Coal Mine Health and Safety 
Act as amended (hereinafter the Act) requires each coal mine operator 
who is operating or has operated a coal mine in a State which is not 
included in the list published by the Secretary (see part 722 of this 
chapter) to secure the payment of benefits for which he may be found 
liable under section 422 of the Act and the provisions of this 
subchapter by either:
    (a) Qualifying as a self-insurer, or
    (b) By subscribing to and maintaining in force a commercial 
insurance contract (including a policy or contract procured from a 
State agency).


Sec. 726.2  Purpose and scope of this part.

    (a) This part provides rules directing and controlling the 
circumstances under which a coal mine operator shall fulfill his 
insurance obligations under the Act.
    (b) This subpart A sets forth the scope and purpose of this part 
and generally describes the statutory framework within which this part 
is operative.
    (c) Subpart B of this part sets forth the criteria a coal mine 
operator must meet in order to qualify as a self-insurer.
    (d) Subpart C of this part sets forth the rules and regulations of 
the Secretary governing contracts of insurance entered into by coal 
operators and commercial insurance sources for the payment of black 
lung benefits under part C of the Act.
    (e) Subpart D of this part sets forth the rules governing the 
imposition of civil money penalties on coal mine operators that fail to 
secure their liability under the Act.


Sec. 726.3  Relationship of this part to other parts in this 
subchapter.

    (a) This part 726 implements and effectuates responsibilities for 
the payment of black lung benefits placed upon coal operators by 
sections 415 and 422 of the Act and the regulations of the Secretary in 
this subchapter, particularly those set forth in part 725 of this 
subchapter. All definitions, usages, procedures, and other rules 
affecting the responsibilities of coal operators prescribed in parts 
715, 720, and 725 of this subchapter are hereby made applicable, as 
appropriate, to this part 726.
    (b) In the event that an apparent conflict arises between the 
interpretation of any provision in this part 726 and the interpretation 
of some provision appearing in a different part of this chapter, the 
conflicting provisions shall be read harmoniously to the fullest extent 
possible. In the event that a harmonious interpretation of the 
provisions is impossible, the provision or provisions of this part 
shall govern insofar as the question is one which arises out of a 
dispute over the responsibilities and obligations of coal mine 
operators to secure the payment of black lung benefits as prescribed by 
the Act. No provision of this part shall be operative as to matters 
falling outside the purview of this part.


Sec. 726.4  Who must obtain insurance coverage.

    (a) Section 423 of part C of title IV of the Act requires each 
operator of a coal mine or former operator in any State

[[Page 3426]]

which does meet the requirements prescribed by the Secretary pursuant 
to section 411 of part C of title IV of the Act to self-insure or 
obtain a policy or contract of insurance to guarantee the payment of 
benefits for which such operator may be adjudicated liable under 
section 422 of the Act. In enacting sections 422 and 423 of the Act 
Congress has unambiguously expressed its intent that coal mine 
operators bear the cost of providing the benefits established by part C 
of title IV of the Act. Section 3 of the Act defines an ``operator'' as 
any owner, lessee, or other person who operates, controls, or 
supervises a coal mine.
    (b) Section 422(i) of the Act clearly recognizes that any 
individual or business entity who is or was a coal mine operator may be 
found liable for the payment of pneumoconiosis benefits after December 
31, 1973. Within this framework it is clear that the Secretary has wide 
latitude for determining which operator shall be liable for the payment 
of part C benefits. Comprehensive standards have been promulgated in 
subpart G of part 725 of this subchapter for the purpose of guiding the 
Secretary in making such determination. It must be noted that pursuant 
to these standards any parent or subsidiary corporation, any individual 
or corporate partner, or partnership, any lessee or lessor of a coal 
mine, any joint venture or participant in a joint venture, any 
transferee or transferor of a corporation or other business entity, any 
former, current, or future operator or any other form of business 
entity which has had or will have a substantial and reasonably direct 
interest in the operation of a coal mine may be determined liable for 
the payment of pneumoconiosis benefits after December 31, 1973. The 
failure of any such business entity to self-insure or obtain a policy 
or contract of insurance shall in no way relieve such business entity 
of its obligation to pay pneumoconiosis benefits in respect of any case 
in which such business entity's responsibility for such payments has 
been properly adjudicated. Any business entity described in this 
section shall take appropriate steps to insure that any liability 
imposed by part C of the Act on such business entity shall be 
dischargeable.


Sec. 726.5  Effective date of insurance coverage.

    Pursuant to section 422(c) of part C of title IV of the Act, no 
coal mine operator shall be responsible for the payment of any benefits 
whatsoever for any period prior to January 1, 1974. However, coal mine 
operators shall be liable as of January 1, 1974, for the payment of 
benefits in respect of claims which were filed under section 415 of 
part B of title IV of the Act after July 1, 1973. Section 415(a)(3) 
requires the Secretary to notify any operator who may be liable for the 
payment of benefits under part C of title IV beginning on January 1, 
1974, of the pendency of a section 415 claim. Section 415(a)(5) 
declares that any operator who has been notified of the pendency of a 
section 415 claim shall be bound by the determination of the Secretary 
as to such operator's liability and as to the claimant's entitlement to 
benefits as if the claim were filed under part C of title IV of the Act 
and section 422 thereof had been applicable to such operator. 
Therefore, even though no benefit payments shall be required of an 
operator prior to January 1, 1974, the liability for these payments may 
be finally adjudicated at any time after July 1, 1973. Neither the 
failure of an operator to exercise his right to participate in the 
adjudication of such a claim nor the failure of an operator to obtain 
insurance coverage in respect of claims filed after June 30, 1973, but 
before January 1, 1974, shall excuse such operator from his liability 
for the payment of benefits to such claimants under part C of title IV 
of the Act.


Sec. 726.6  The Office of Workers' Compensation Programs.

    The Office of Workers' Compensation Programs (hereinafter the 
Office or OWCP) is that subdivision of the Employment Standards 
Administration of the U.S. Department of Labor which has been empowered 
by the Secretary of Labor to carry out his functions under section 415 
and part C of title IV of the Act. As noted throughout this part 726 
the Office shall perform a number of functions with respect to the 
regulation of both the self-insurance and commercial insurance 
programs. All correspondence with or submissions to the Office should 
be addressed as follows:

Division of Coal Mine Workers' Compensation, Office of Workers' 
Compensation Programs, Employment Standards Administration, U.S. 
Department of Labor, Washington, D.C. 20210


Sec. 726.7  Forms, submission of information.

    Any information required by this part 726 to be submitted to the 
Office of Workmen's Compensation Programs or any other office or 
official of the Department of Labor, shall be submitted on such forms 
or in such manner as the Secretary deems appropriate and has authorized 
from time to time for such purposes.


Sec. 726.8  Definitions.

    In addition to the definitions provided in part 725 of this 
chapter, the following definitions apply to this part:
    (a) Director means the Director, Office of Workers' Compensation 
Programs, and includes any official of the Office of Workers' 
Compensation Programs authorized by the Director to perform any of the 
functions of the Director under this part and part 725 of this chapter.
    (b) Person includes any individual, partnership, corporation, 
association, business trust, legal representative, or organized group 
of persons.
    (c) Secretary means the Secretary of Labor or such other official 
as the Secretary shall designate to carry out any responsibility under 
this part.
    (d) The terms employ and employment shall be construed as broadly 
as possible, and shall include any relationship under which an operator 
retains the right to direct, control, or supervise the work performed 
by a miner, or any other relationship under which an operator derives a 
benefit from the work performed by a miner. Any individuals who 
participate with one or more persons in the mining of coal, such as 
owners, proprietors, partners, and joint venturers, whether they are 
compensated by wages, salaries, piece rates, shares, profits, or by any 
other means, shall be deemed employees.

Subpart B--Authorization of Self-Insurers


Sec. 726.101  Who may be authorized to self-insure.

    (a) Pursuant to section 423 of part C of title IV of the Act, 
authorization to self-insure against liability incurred by coal mine 
operators on account of the total disability or death of miners due to 
pneumoconiosis may be granted or denied in the discretion of the 
Secretary. The provisions of this subpart describe the minimum 
requirements established by the Secretary for determining whether any 
particular coal mine operator shall be authorized as a self-insurer.
    (b) The minimum requirements which must be met by any operator 
seeking authorization to self-insure are as follows:
    (1) Such operator must, at the time of application, have been in 
the business of mining coal for at least the 3 consecutive years prior 
to such application; and,
    (2) Such operator must demonstrate the administrative capacity to 
fully service such claims as may be filed against him; and,

[[Page 3427]]

    (3) Such operator's average current assets over the preceding 3 
years (in computing average current assets such operator shall not 
include the amount of any negotiable securities which he may be 
required to deposit to secure his obligations under the Act) must 
exceed current liabilities by the sum of--
    (i) The estimated aggregate amount of black lung benefits 
(including medical benefits) which such operator may expect to be 
required to pay during the ensuing year; and,
    (ii) The annual premium cost for any indemnity bond purchased; and
    (4) Such operator must obtain security, in a form approved by the 
Office (see Sec. 726.104) and in an amount to be determined by the 
Office (see Sec. 726.105); and
    (5) No operator with fewer than 5 full-time employee-miners shall 
be permitted to self-insure.
    (c) No operator who is unable to meet the requirements of this 
section should apply for authorization to self-insure and no 
application for self-insurance shall be approved by the Office until 
such time as the amount prescribed by the Office has been secured as 
prescribed in this subpart.


Sec. 726.102  Application for authority to become a self-insurer; how 
filed; information to be submitted.

    (a) How filed. Application for authority to become a self-insurer 
shall be addressed to the Office and be made on a form provided by the 
Office. Such application shall be signed by the applicant over his 
typewritten name and if the applicant is not an individual, by the 
principal officer of the applicant duly authorized to make such 
application over his typewritten name and official designation and 
shall be sworn to by him. If the applicant is a corporation, the 
corporate seal shall be affixed. The application shall be filed with 
the Office in Washington, D.C.
    (b) Information to be submitted. Each application for authority to 
self-insure shall contain:
    (1) A statement of the employer's payroll report for each of the 
preceding 3 years;
    (2) A statement of the average number of employees engaged in 
employment within the purview of the Act for each of the preceding 3 
years;
    (3) A list of the mine or mines to be covered by any particular 
self-insurance agreement. Each such mine or mines listed shall be 
described by name and reference shall be made to the Federal 
Identification Number assigned such mine by the Bureau of Mines, U.S. 
Department of the Interior;
    (4) A certified itemized statement of the gross and net assets and 
liabilities of the operator for each of the 3 preceding years in such 
manner as prescribed by the Office;
    (5) A statement demonstrating the applicant's administrative 
capacity to provide or procure adequate servicing for a claim including 
both medical and dollar claims; and
    (6) In addition to the aforementioned, the Office may in its 
discretion, require the applicant to submit such further information or 
such evidence as the Office may deem necessary to have in order to 
enable it to give adequate consideration to such application.
    (c) Who may file. An application for authorization to self-insure 
may be filed by any parent or subsidiary corporation, partner or 
partnership, party to a joint venture or joint venture, individual, or 
other business entity which may be determined liable for the payment of 
black lung benefits under part C of title IV of the Act, regardless of 
whether such applicant is directly engaged in the business of mining 
coal. However, in each case for which authorization to self-insure is 
granted, the agreement and undertaking filed pursuant to Sec. 726.110 
and the security deposit shall be respectively filed by and deposited 
in the name of the applicant only.


Sec. 726.103  Application for authority to self-insure; effect of 
regulations contained in this part.

    As appropriate, each of the regulations, interpretations and 
requirements contained in this part 726 including those described in 
subpart C of this part shall be binding upon each applicant hereunder 
and the applicant's consent to be bound by all requirements of the said 
regulations shall be deemed to be included in and a part of the 
application, as fully as though written therein.


Sec. 726.104  Action by the Office upon application of operator.

    (a) Upon receipt of a completed application for authorization to 
self-insure, the Office shall, after examination of the information 
contained in the application deny the applicant's request for 
authorization to self-insure or, determine the amount of security which 
must be given by the applicant to guarantee the payment of benefits and 
the discharge of all other obligations which may be required of such 
applicant under the Act.
    (b) The applicant shall thereafter be notified that he may give 
security in the amount fixed by the Office (see Sec. 726.105):
    (1) In the form of an indemnity bond with sureties satisfactory to 
the Office;
    (2) By a deposit of negotiable securities with a Federal Reserve 
Bank in compliance with Secs. 726.106(c) and 726.107;
    (3) In the form of a letter of credit issued by a financial 
institution satisfactory to the Office (except that a letter of credit 
shall not be sufficient by itself to satisfy a self-insurer's 
obligations under this part); or
    (4) By funding a trust pursuant to section 501(c)(21) of title 26 
of the United States Code.
    (c) Any applicant who cannot meet the security deposit requirements 
imposed by the Office should proceed to obtain a commercial policy or 
contract of insurance. Any applicant for authorization to self-insure 
whose application has been rejected or who believes that the security 
deposit requirements imposed by the Office are excessive may, in 
writing, request that the Office review its determination. A request 
for review should contain such information as may be necessary to 
support the request that the amount of security required be reduced.
    (d) Upon receipt of any such request the Office shall review its 
previous determination in light of any new or additional information 
submitted and inform the applicant whether or not a reduction in the 
amount of security initially required is warranted.


Sec. 726.105  Fixing the amount of security.

    The amount of security to be fixed and required by the Office shall 
be such as the Office shall deem to be necessary and sufficient to 
secure the performance by the applicant of all obligations imposed upon 
him as an operator by the Act. In determining the amount of security 
required, the factors that the Office will consider include, but are 
not limited to, the operator's net worth, the existence of a guarantee 
by a parent corporation, and the operator's existing liability for 
benefits. Other factors such as the Office may deem relevant to any 
particular case shall be considered. The amount of security which shall 
be required may be increased or decreased when experience or changed 
conditions so warrant.


Sec. 726.106  Type of security.

    (a) The Office shall determine the type or types of security which 
an applicant shall or may procure. (See Sec. 726.104(b).)
    (b) In the event the indemnity bond option is selected such 
indemnity bond shall be in such form and contain such provisions as the 
Office may prescribe: Provided, That only corporations may act as 
sureties on such indemnity bonds. In each case in which the surety on 
any such bond is a surety company, such company must be one approved by 
the

[[Page 3428]]

U.S. Treasury Department under the laws of the United States and the 
applicable rules and regulations governing bonding companies (see 
Department of Treasury's Circular-570).
    (c) An applicant for authorization to self-insure authorized to 
deposit negotiable securities to secure his obligations under the Act 
in the amount fixed by the Office shall deposit any negotiable 
securities acceptable as security for the deposit of public moneys of 
the United States under regulations issued by the Secretary of the 
Treasury. (See 31 CFR part 225.) The approval, valuation, acceptance, 
and custody of such securities is hereby committed to the several 
Federal Reserve Banks and the Treasurer of the United States.


Sec. 726.107  Deposits of negotiable securities with Federal Reserve 
banks or the Treasurer of the United States; authority to sell such 
securities; interest thereon.

    Deposits of securities provided for by the regulations in this part 
shall be made with any Federal Reserve bank or any branch of a Federal 
Reserve bank designated by the Office, or the Treasurer of the United 
States, and shall be held subject to the order of the Office with power 
in the Office, in its discretion in the event of default by the said 
self-insurer, to collect the interest as it may become due, to sell the 
securities or any of them as may be required to discharge the 
obligations of the self-insurer under the Act and to apply the proceeds 
to the payment of any benefits or medical expenses for which the self-
insurer may be liable. The Office may, however, whenever it deems it 
unnecessary to resort to such securities for the payment of benefits, 
authorize the self-insurer to collect interest on the securities 
deposited by him.


Sec. 726.108  Withdrawal of negotiable securities.

    No withdrawal of negotiable securities deposited by a self-insurer, 
shall be made except upon authorization by the Office. A self-insurer 
discontinuing business, or discontinuing operations within the purview 
of the Act, or providing security for the payment of benefits by 
commercial insurance under the provisions of the Act may apply to the 
Office for the withdrawal of securities deposited under the regulations 
in this part. With such application shall be filed a sworn statement 
setting forth:
    (a) A list of all outstanding cases in which benefits are being 
paid, with the names of the miners and other beneficiaries, giving a 
statement of the amounts of benefits paid and the periods for which 
such benefits have been paid; and
    (b) A similar list of all pending cases in which no benefits have 
as yet been paid. In such cases withdrawals may be authorized by the 
Office of such securities as in the opinion of the Office may not be 
necessary to provide adequate security for the payment of outstanding 
and potential liabilities of such self-insurer under the Act.


Sec. 726.109  Increase or reduction in the amount of security.

    Whenever in the opinion of the Office the amount of security given 
by the self-insurer is insufficient to afford adequate security for the 
payment of benefits and medical expenses under the Act, the self-
insurer shall, upon demand by the Office, file such additional security 
as the Office may require. At any time upon application of a self-
insurer, or on the initiative of the Office, when in its opinion the 
facts warrant, the amount of security may be reduced. A self-insurer 
seeking such reduction shall furnish such information as the Office may 
request relative to his current affairs, the nature and hazard of the 
work of his employees, the amount of the payroll of his employees 
engaged in coal mine employment within the purview of the Act, his 
financial condition, and such other evidence as may be deemed material, 
including a record of payment of benefits made by him.


Sec. 726.110  Filing of agreement and undertaking.

    (a) In addition to the requirement that adequate security be 
procured as set forth in this subpart, the applicant for the 
authorization to self-insure shall as a condition precedent to 
receiving authorization to act as a self-insurer, execute and file with 
the Office an agreement and undertaking in a form prescribed and 
provided by the Office in which the applicant shall agree:
    (1) To pay when due, as required by the provisions of said Act, all 
benefits payable on account of total disability or death of any of its 
employee-miners within the purview of the Act;
    (2) In such cases to furnish medical, surgical, hospital, and other 
attendance, treatment, and care as required by the provisions of the 
Act;
    (3) To provide security in a form approved by the Office (see 
Sec. 726.104) and in an amount established by the Office (see 
Sec. 726.105), accordingly as elected in the application;
    (4) To authorize the Office to sell any negotiable securities so 
deposited or any part thereof and from the proceeds thereof to pay such 
benefits, medical, and other expenses and any accrued penalties imposed 
by law as it may find to be due and payable.
    (b) At such time when an applicant has provided the requisite 
security, such applicant shall send a completed agreement and 
undertaking together with satisfactory proof that his obligations and 
liabilities under the Act have been secured to the Office in 
Washington, D.C.


Sec. 726.111  Notice of authorization to self-insure.

    Upon receipt of a completed agreement and undertaking and 
satisfactory proof that adequate security has been provided an 
applicant for authorization to self-insure shall be notified by the 
Office in writing, that he is authorized to self-insure to meet the 
obligations imposed upon such applicant by section 415 and part C of 
title IV of the Act.


Sec. 726.112  Reports required of self-insurer; examination of accounts 
of self-insurer.

    (a) Each operator who has been authorized to self-insure under this 
part shall submit to the Office reports containing such information as 
the Office may from time to time require or prescribe.
    (b) Whenever it deems it to be necessary, the Office may inspect or 
examine the books of account, records, and other papers of a self-
insurer for the purpose of verifying any financial statement submitted 
to the Office by the self-insurer or verifying any information 
furnished to the Office in any report required by this section, or any 
other section of the regulations in this part, and such self-insurer 
shall permit the Office or its duly authorized representative to make 
such an inspection or examination as the Office shall require. In lieu 
of this requirement the Office may in its discretion accept an adequate 
report of a certified public accountant.
    (c) Failure to submit or make available any report or information 
requested by the Office from an authorized self-insurer pursuant to 
this section may, in appropriate circumstances result in a revocation 
of the authorization to self-insure.


Sec. 726.113  Disclosure of confidential information.

    Any financial information or records, or other information relating 
to the business of an authorized self-insurer or applicant for the 
authorization of self-insurance obtained by the Office shall be exempt 
from public disclosure to the extent provided in 5 U.S.C. 552(b) and 
the applicable regulations of the

[[Page 3429]]

Department of Labor promulgated thereunder. (See 29 CFR part 70.)


Sec. 726.114  Period of authorization as self-insurer; reauthorization.

    (a) No initial authorization as a self-insurer shall be granted for 
a period in excess of 18 months. A self-insurer who has made an 
adequate deposit of negotiable securities in compliance with 
Secs. 726.106(c) and 726.107 will be reauthorized for the ensuing 
fiscal year without additional security if the Office finds that his 
experience as a self-insurer warrants such action. If it is determined 
that such self-insurer's experience indicates a need for the deposit of 
additional security, no reauthorization shall be issued for the ensuing 
fiscal year until such time as the Office receives satisfactory proof 
that the requisite amount of additional securities have been deposited. 
A self-insurer who currently has on file an indemnity bond, will 
receive from the Office each year a bond form for execution in 
contemplation of reauthorization, and the submission of such bond duly 
executed in the amount indicated by the Office will be deemed and 
treated as such self-insurer's application for reauthorization for the 
ensuing Federal fiscal year.
    (b) In each case for which there is an approved change in the 
amount of security provided, a new agreement and undertaking shall be 
executed.
    (c) Each operator authorized to self-insure under this part shall 
apply for reauthorization for any period during which it engages in the 
operation of a coal mine and for additional periods after it ceases 
operating a coal mine. Upon application by the operator, accompanied by 
proof that the security posted by the operator is sufficient to secure 
all benefits potentially payable to miners formerly employed by the 
operator, the Office shall issue a certification that the operator is 
exempt from the requirements of this part based on its prior operation 
of a coal mine. The provisions of subpart D of this part shall be 
applicable to any operator that fails to apply for reauthorization in 
accordance with the provisions of this section.


Sec. 726.115  Revocation of authorization to self-insure.

    The Office may for good cause shown suspend or revoke the 
authorization of any self-insurer. Failure by a self-insurer to comply 
with any provision or requirement of law or of the regulations in this 
part, or with any lawful order or communication of the Office, or the 
failure or insolvency of the surety on his indemnity bond, or 
impairment of financial responsibility of such self-insurer, may be 
deemed good cause for such suspension or revocation.

Subpart C--Insurance Contracts


Sec. 726.201  Insurance contracts--generally.

    Each operator of a coal mine who has not obtained authorization as 
a self-insurer shall purchase a policy or enter into a contract with a 
commercial insurance carrier or State agency. Pursuant to authority 
contained in sections 422(a) and 423 (b) and (c) of part C of title IV 
of the Act, this subpart describes a number of provisions which are 
required to be incorporated in a policy or contract of insurance 
obtained by a coal mine operator for the purpose of meeting the 
responsibility imposed upon such operator by the Act in respect of the 
total disability or death of miners due to pneumoconiosis.


Sec. 726.202  Who may underwrite an operator's liability.

    Each coal mine operator who is not authorized to self-insure shall 
insure and keep insured the payment of benefits as required by the Act 
with any stock company or mutual company or association, or with any 
other person, or fund, including any State fund while such company, 
association, person, or fund is authorized under the law of any State 
to insure workmen's compensation.


Sec. 726.203  Federal Coal Mine Health and Safety Act endorsement.

    (a) The following form of endorsement shall be attached and 
applicable to the standard workmen's compensation and employer's 
liability policy prepared by the National Council on Compensation 
Insurance affording coverage under the Federal Coal Mine Health and 
Safety Act of 1969, as amended:

    It is agreed that: (1) With respect to operations in a State 
designated in item 3 of the declarations, the unqualified term 
``workmen's compensation law'' includes part C of title IV of the 
Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. section 
931-936, and any laws amendatory thereto, or supplementary thereto, 
which may be or become effective while this policy is in force, and 
definition (a) of Insuring Agreement III is amended accordingly; (2) 
with respect to such insurance as is afforded by this endorsement, 
(a) the States, if any, named below, shall be deemed to be 
designated in item 3 of the declaration; (b) Insuring Agreement 
IV(2) is amended to read ``by disease caused or aggravated by 
exposure of which the last day of the last exposure, in the 
employment of the insured, to conditions causing the disease occurs 
during the policy period, or occurred prior to (effective date) and 
claim based on such disease is first filed against the insured 
during the policy period.''

    (b) The term ``effective date'' as used in the enforcement 
provisions contained in paragraph (a) of this section shall be 
construed to mean the effective date of the first policy or contract of 
insurance procured by an operator for purposes of meeting the 
obligations imposed on such operator by section 423 of part C of title 
IV of the Act.
    (c) The Act contains a number of provisions and imposes a number of 
requirements on operators which differ in varying degrees from 
traditional workmen's compensation concepts. To avoid unnecessary 
administrative delays and expense which might be occasioned by the 
drafting of an entirely new standard workmen's compensation policy 
specially tailored to the Act, the Office has determined that the 
existing standard workmen's compensation policy subject to the 
endorsement provisions contained in paragraph (a) of this section shall 
be acceptable for purposes of writing commercial insurance coverage 
under the Act. However, to avoid undue disputes over the meaning of 
certain policy provisions and in accordance with the authority 
contained in section 423(b)(3) of the Act, the Office has determined 
that the following requirements shall be applicable to all commercial 
insurance policies obtained by an operator for the purpose of insuring 
any liability incurred pursuant to the Act:
    (1) Operator liability. (i) Section 415 and part C of title IV of 
the Act provide coverage for total disability or death due to 
pneumoconiosis to all claimants who meet the eligibility requirements 
imposed by the Act. Section 422 of the Act and the regulations duly 
promulgated thereunder (part 725 of this chapter) set forth the 
conditions under which a coal mine operator may be adjudicated liable 
for the payment of benefits to an eligible claimant for any period 
subsequent to December 31, 1973.
    (ii) Section 422(c) of the Act prescribes that except as provided 
in 422(i) (see paragraph (c)(2) of this section) an operator may be 
adjudicated liable for the payment of benefits in any case if the total 
disability or death due to pneumoconiosis upon which the claim is 
predicated arose at least in part out of employment in a mine in any 
period during which it was operated by such operator. The Act does not 
require that such employment which contributed to or caused the total 
disability or death due to pneumoconiosis occur subsequent to

[[Page 3430]]

any particular date in time. The Secretary in establishing a formula 
for determining the operator liable for the payment of benefits (see 
subpart D of part 725 of this chapter) in respect of any particular 
claim, must therefore, within the framework and intent of title IV of 
the Act find in appropriate cases that an operator is liable for the 
payment of benefits for some period after December 31, 1973, even 
though the employment upon which an operator's liability is based 
occurred prior to July 1, 1973, or prior to the effective date of the 
Act or the effective date of any amendments thereto, or prior to the 
effective date of any policy or contract of insurance obtained by such 
operator. The enforcement provisions contained in paragraph (a) of this 
section shall be construed to incorporate these requirements in any 
policy or contract of insurance obtained by an operator to meet the 
obligations imposed on such operator by section 423 of the Act.
    (2) Successor liability. Section 422(i) of part C of title IV of 
the Act requires that a coal mine operator who after December 30, 1969, 
acquired his mine or substantially all of the assets thereof from a 
person who was an operator of such mine on or after December 30, 1969, 
shall be liable for and shall secure the payment of benefits which 
would have been payable by the prior operator with respect to miners 
previously employed in such mine if the acquisition had not occurred 
and the prior operator had continued to operate such mine. In the case 
of an operator who is determined liable for the payment of benefits 
under section 422(i) of the Act and part 725 of this subchapter, such 
liability shall accrue to such operator regardless of the fact that the 
miner on whose total disability or death the claim is predicated was 
never employed by such operator in any capacity. The enforcement 
provisions contained in paragraph (a) of this section shall be 
construed to incorporate this requirement in any policy or contract of 
insurance obtained by an operator to meet the obligations imposed on 
such operator by section 423 of the Act.
    (3) Medical eligibility. Pursuant to section 422(h) of part C of 
title IV of the Act and the regulations described therein (see subpart 
D of part 410 of this title) benefits shall be paid to eligible 
claimants on account of total disability or death due to pneumoconiosis 
and in cases where the miner on whose death a claim is predicated was 
totally disabled by pneumoconiosis at the time of his death regardless 
of the cause of such death. The enforcement provisions contained in 
paragraph (a) of this section shall be construed to incorporate these 
requirements in any policy or contract of insurance obtained by an 
operator to meet the obligations imposed on such operator by section 
423 of the Act.
    (4) Payment of benefits, rates. Section 422(c) of the Act by 
incorporating section 412(a) of the Act requires the payment of 
benefits at a rate equal to 50 per centum of the minimum monthly 
payment to which a Federal employee in grade GS-2, who is totally 
disabled is entitled at the time of payment under Chapter 81 of title 
5, United States Code. These benefits are augmented on account of 
eligible dependents as appropriate (see section 412(a) of part B of 
title IV of the Act). Since the dollar amount of benefits payable to 
any beneficiary is required to be computed at the time of payment such 
amounts may be expected to increase from time to time as changes in the 
GS-2 grade are enacted into law. The enforcement provisions contained 
in paragraph (a) of this section shall be construed to incorporate in 
any policy or contract of insurance obtained by an operator to meet the 
obligations imposed on such operator by section 423 of the Act, the 
requirement that the payment of benefits to eligible beneficiaries 
shall be made in such dollar amounts as are prescribed by section 
412(a) of the Act computed at the time of payment.
    (5) Compromise and waiver of benefits. Section 422(a) of part C of 
title IV of the Act by incorporating sections 15(b) and 16 of the 
Longshoremen's and Harbor Workers' Compensation Act (33 U.S.C. 915(b) 
and 916) prohibits the compromise and/or waiver of claims for benefits 
filed or benefits payable under section 415 and part C of title IV of 
the Act. The enforcement provisions contained in paragraph (a) of this 
section shall be construed to incorporate these prohibitions in any 
policy or contract of insurance obtained by an operator to meet the 
obligations imposed on such operator by section 423 of the Act.
    (6) Additional requirements. In addition to the requirements 
described in paragraphs (c) (1) through (5) of this section, the 
enforcement provisions contained in paragraph (a) of this section 
shall, to the fullest extent possible, be construed to bring any policy 
or contract of insurance entered into by an operator for the purpose of 
insuring such operator's liability under part C of title IV of the Act 
into conformity with the legal requirements placed upon such operator 
by section 415 and part C of title IV of the Act and parts 720 and 725 
of this subchapter.
    (d) Nothing in this section shall relieve any operator or carrier 
of the duty to comply with any State workmen's compensation law, except 
insofar as such State law is in conflict with the provisions of this 
section.


Sec. 726.204  Statutory policy provisions.

    Pursuant to section 423(b) of part C of title IV of the Act each 
policy or contract of insurance obtained to comply with the 
requirements of section 423(a) of the Act must contain or shall be 
construed to contain--
    (a) A provision to pay benefits required under section 422 of the 
Act, notwithstanding the provisions of the State workmen's compensation 
law which may provide for lesser payments; and,
    (b) A provision that insolvency or bankruptcy of the operator or 
discharge therein (or both) shall not relieve the carrier from 
liability for such payments.


Sec. 726.205  Other forms of endorsement and policies.

    Forms of endorsement or policies other than that described in 
Sec. 726.203 may be entered into by operators to insure their liability 
under the Act. However, any form of endorsement or policy which 
materially alters or attempts to materially alter an operator's 
liability for the payment of any benefits under the Act shall be deemed 
insufficient to discharge such operator's duties and responsibilities 
as prescribed in part C of title IV of the Act. In any event, the 
failure of an operator to obtain an adequate policy or contract of 
insurance shall not affect such operator's liability for the payment of 
any benefits for which he is determined liable.


Sec. 726.206  Terms of policies.

    A policy or contract of insurance shall be issued for the term of 1 
year from the date that it becomes effective, but if such insurance be 
not needed except for a particular contract or operation, the term of 
the policy may be limited to the period of such contract or operation.


Sec. 726.207  Discharge by the carrier of obligations and duties of 
operator.

    Every obligation and duty in respect of payment of benefits, the 
providing of medical and other treatment and care, the payment or 
furnishing of any other benefit required by the Act and in respect of 
the carrying out of the administrative procedure required or imposed by 
the Act or the regulations in this part or 20 CFR part 725 upon an 
operator shall be discharged and carried out by the carrier as 
appropriate. Notice to or knowledge of an operator of the occurrence of 
total disability or death

[[Page 3431]]

due to pneumoconiosis shall be notice to or knowledge of such carrier. 
Jurisdiction of the operator by a district director, administrative law 
judge, the Office, or appropriate appellate authority under the Act 
shall be jurisdiction of such carrier. Any requirement under any 
benefits order, finding, or decision shall be binding upon such carrier 
in the same manner and to the same extent as upon the operator.

Reports by Carrier


Sec. 726.208  Report by carrier of issuance of policy or endorsement.

    Each carrier shall report to the Office each policy and endorsement 
issued, canceled, or renewed by it to an operator. The report shall be 
made in such manner and on such form as the Office may require.

(Approved by the Office of Management and Budget under control 
number 1215-0059)

(Pub. L. No. 96-511)


Sec. 726.209  Report; by whom sent.

    The report of issuance, cancellation, or renewal of a policy and 
endorsement provided for in Sec. 726.208 shall be sent by the home 
office of the carrier, except that any carrier may authorize its agency 
or agencies to make such reports to the Office.

(Approved by the Office of Management and Budget under control 
number 1215-0059)

(Pub. L. No. 96-511)


Sec. 726.210  Agreement to be bound by report.

    Every carrier seeking to write insurance under the provisions of 
this Act shall be deemed to have agreed that the acceptance by the 
Office of a report of the issuance or renewal of a policy of insurance, 
as provided for by Sec. 726.208 shall bind the carrier to full 
liability for the obligations under this Act of the operator named in 
said report. It shall be no defense to this agreement that the carrier 
failed or delayed to issue, cancel, or renew the policy to the operator 
covered by this report.

(Approved by the Office of Management and Budget under control 
number 1215-0059)


(Pub. L. No. 96-511)


Sec. 726.211  Name of one employer only shall be given in each report.

    A separate report of the issuance or renewal of a policy and 
endorsement, provided for by Sec. 726.208, shall be made for each 
operator covered by a policy. If a policy is issued or renewed insuring 
more than one operator, a separate report for each operator so covered 
shall be sent to the Office with the name of only one operator on each 
such report.

(Approved by the Office of Management and Budget under control 
number 1215-0059)

(Pub. L. No. 96-511)


Sec. 726.212  Notice of cancellation.

    Cancellation of a contract or policy of insurance issued under 
authority of the Act shall not become effective otherwise than as 
provided by 33 U.S.C. 936(b); and notice of a proposed cancellation 
shall be given to the Office and to the operator in accordance with the 
provisions of 33 U.S.C. 912(c), 30 days before such cancellation is 
intended to be effective (see sec. 422(a) of part C of title IV of the 
Act).

(Approved by the Office of Management and Budget under control 
number 1215-0059)

(Pub. L. No. 96-511)


Sec. 726.213  Reports by carriers concerning the payment of benefits.

    Pursuant to 33 U.S.C. 914(c) as incorporated by section 422(a) of 
part C of title IV of the Act and Sec. 726.207 each carrier issuing a 
policy or contract of insurance under the Act shall upon making the 
first payment of benefits and upon the suspension of any payment in any 
case, immediately notify the Office in accordance with a form 
prescribed by the Office that payment of benefit has begun or has been 
suspended as the case may be. In addition, each such carrier shall at 
the request of the Office submit to the Office such additional 
information concerning policies or contracts of insurance issued to 
guarantee the payment of benefits under the Act and any benefits paid 
thereunder, as the Office may from time to time require to carry out 
its responsibilities under the Act.

(Approved by the Office of Management and Budget under control 
number 1215-0059)

(Pub. L. No. 96-511)

Subpart D--Civil Money Penalties


Sec. 726.300  Purpose and Scope.

    Any operator which is required to secure the payment of benefits 
under section 423 of the Act and Sec. 726.4 and which fails to secure 
such benefits shall be subject to a civil penalty of not more than 
$1,000 for each day during which such failure occurs. If the operator 
is a corporation, the president, secretary, and treasurer of the 
operator shall also be severally liable for the penalty based on the 
operator's failure to secure the payment of benefits. This subpart 
defines those terms necessary for administration of the civil money 
penalty provisions, describes the criteria for determining the amount 
of penalty to be assessed, and sets forth applicable procedures for the 
assessment and contest of penalties.


Sec. 726.301  Definitions.

    In addition to the definitions provided in part 725 of this chapter 
and Sec. 726.8, the following definitions apply to this subpart:
    (a) Division Director means the Director, Division of Coal Mine 
Workers' Compensation, Office of Workers' Compensation Programs, 
Employment Standards Administration, or such other official authorized 
by the Division Director to perform any of the functions of the 
Division Director under this subpart.
    (b) President, secretary, or treasurer means the officers of a 
corporation as designated pursuant to the laws and regulations of the 
state in which the corporation is incorporated or, if that state does 
not require the designation of such officers, to the employees of a 
company who are performing the work usually performed by such officers 
in the state in which the corporation's principal place of business is 
located.
    (c) Principal means any person who has an ownership interest in an 
operator that is not a corporation, and shall include, but is not 
limited to, partners, sole proprietors, and any other person who 
exercises control over the operation of a coal mine.


Sec. 726.302  Determination of penalty.

    (a) The following method shall be used for determining the amount 
of any penalty assessed under this subpart.
    (b) The penalty shall be determined by multiplying the daily base 
penalty amount or amounts, determined in accordance with the formula 
set forth in this section, by the number of days in the period during 
which the operator is subject to the security requirements of section 
423 of the Act and Sec. 726.4, and fails to secure its obligations 
under the Act. The period during which an operator is subject to 
liability for a penalty for failure to secure its obligations shall be 
deemed to commence on the first day on which the operator met the 
definition of the term ``operator'' as set forth in Sec. 725.101 of 
this chapter. The period shall be deemed to continue even where the 
operator has ceased coal mining and any related activity, unless the 
operator secured its liability for all previous periods through a 
policy or policies of insurance obtained in accordance with subpart C 
of this part or has obtained a certification of exemption in accordance 
with the provisions of Sec. 726.114.
    (c)(1) A daily base penalty amount shall be determined for all 
periods up to and including the 10th day after the operator's receipt 
of the notification sent by the Director pursuant to Sec. 726.303, 
during which the operator failed to

[[Page 3432]]

secure its obligations under section 423 of the Act and Sec. 726.4.
    (2)(i) The daily base penalty amount shall be determined based on 
the number of persons employed in coal mine employment by the operator, 
or engaged in coal mine employment on behalf of the operator, on each 
day of the period defined by this section, and shall be computed as 
follows:

------------------------------------------------------------------------
                                                               Penalty  
                         Employees                            (per day) 
------------------------------------------------------------------------
Less than 25...............................................         $100
25-50......................................................          200
51-100.....................................................          300
More than 100..............................................          400
------------------------------------------------------------------------

    (ii) For any period after the operator has ceased coal mining and 
any related activity, the daily penalty amount shall be computed based 
on the largest number of persons employed in coal mine employment by 
the operator, or engaged in coal mine employment on behalf of the 
operator, on any day while the operator was engaged in coal mining or 
any related activity. For purposes of this section, it shall be 
presumed, in the absence of evidence to the contrary, that any person 
employed by an operator is employed in coal mine employment.
    (3) In any case in which the operator had prior notice of the 
applicability of the Black Lung Benefits Act to its operations, the 
daily base penalty amounts set forth in paragraph (b) shall be doubled. 
Prior notice may be inferred where the operator, or an entity in which 
the operator or any of its principals had an ownership interest, or an 
entity in which the operator's president, secretary, or treasurer were 
employed:
    (i) Previously complied with section 423 of the Act and Sec. 726.4;
    (ii) Was notified of its obligation to comply with section 423 of 
the Act and Sec. 726.4; or
    (iii) Was notified of its potential liability for a claim filed 
under the Black Lung Benefits Act pursuant to Sec. 725.407 of this 
chapter.
    (4) Commencing with the 11th day after the operator's receipt of 
the notification sent by the Director pursuant to Sec. 726.303, the 
daily base penalty amounts set forth in paragraph (b) shall be 
increased by $100.
    (5) In any case in which the operator, or any of its principals, or 
an entity in which the operator's president, secretary, or treasurer 
were employed, has been the subject of a previous penalty assessment 
under this part, the daily base penalty amounts shall be increased by 
$300, up to a maximum daily base penalty amount of $1,000. The maximum 
daily base penalty amount applicable to any violation of Sec. 726.4 
that takes place after [effective date of the final rule] shall be 
$1,100.
    (d) The penalty shall be subject to reduction for any period during 
which the operator had a reasonable belief that it was not required to 
comply with section 423 of the Act and Sec. 726.4 or a reasonable 
belief that it had obtained insurance coverage to comply with section 
423 of the Act and Sec. 726.4. A notice of contest filed in accordance 
with Sec. 726.307 shall not be sufficient to establish a reasonable 
belief that the operator was not required to comply with the Act and 
regulations.


Sec. 726.303  Notification; investigation.

    (a) If the Director determines that an operator has violated the 
provisions of section 423 of the Act and Sec. 726.4, he or she shall 
notify the operator of its violation and request that the operator 
immediately secure the payment of benefits. Such notice shall be sent 
by certified mail.
    (b) The Director shall also direct the operator to supply 
information relevant to the assessment of a penalty. Such information, 
which shall be supplied within 30 days of the Director's request, may 
include:
    (1) The date on which the operator commenced its operation of a 
coal mine;
    (2) The number of persons employed by the operator since it began 
operating a coal mine and the dates of their employment; and
    (3) The identity and last known address:
    (i) In the case of a corporation, of all persons who served as 
president, secretary, and treasurer of the operator since it began 
operating a coal mine; or
    (ii) In the case of an operator which is not incorporated, of all 
persons who were principals of the operator since it began operating a 
coal mine;
    (c) In conducting any investigation of an operator under this 
subpart, the Division Director shall have all of the powers of a 
district director, as set forth at Sec. 725.351(a) of this chapter. For 
purposes of Sec. 725.351(c) of this chapter, the Division Director 
shall be considered to sit in the District of Columbia.


Sec. 726.304  Notice of initial assessment.

    (a) After an operator receives notification under Sec. 726.303 and 
fails to secure its obligations for the period defined in 
Sec. 726.302(b), and following the completion of any investigation, the 
Director may issue a notice of initial penalty assessment in accordance 
with the criteria set forth in Sec. 726.302.
    (b)(1) A copy of such notice shall be sent by certified mail to the 
operator. If the operator is a corporation, a copy shall also be sent 
by certified mail to each of the persons who served as president, 
secretary, or treasurer of the operator during any period in which the 
operator was in violation of section 423 of the Act and Sec. 726.4.
    (2) Where service by certified mail is not accepted by any person, 
the notice shall be deemed received by that person on the date of 
attempted delivery. Where service is not accepted, the Director may 
exercise discretion to serve the notice by regular mail.


Sec. 726.305   Contents of notice.

    The notice required by Sec. 726.304 shall:
    (a) Identify the operator against whom the penalty is assessed as 
well as the name of any other person severally liable for such penalty;
    (b) Set forth the determination of the Director as to the amount of 
the penalty and the reason or reasons therefor;
    (c) Set forth the right of each person identified in paragraph (a) 
of this section to contest the notice and request a hearing before the 
Office of Administrative Law Judges;
    (d) Set forth the method for each person identified in paragraph 
(a) to contest the notice and request a hearing before the Office of 
Administrative Law Judges; and
    (e) Inform any affected person that in the absence of a timely 
contest and request for hearing received within 30 days of the date of 
receipt of the notice, the Director's assessment will become final and 
unappealable as to that person.


Sec. 726.306   Finality of administrative assessment.

    Except as provided in Sec. 726.307(c), if any person identified as 
potentially liable for the assessment does not, within 30 days after 
receipt of notice, contest the assessment, the Director's assessment 
shall be deemed final as to that person, and collection and recovery of 
the penalty may be instituted pursuant to Sec. 726.320.


Sec. 726.307   Form of notice of contest and request for hearing.

    (a) Any person desiring to contest the Director's notice of initial 
assessment shall request an administrative hearing pursuant to this 
part. The notice of contest shall be made in writing to the Director, 
Division of Coal Mine Workers' Compensation, Office of Workers' 
Compensation Programs, Employment Standards Administration, United 
States Department of Labor. The notice of contest must be received no 
later than 30 days after the date of receipt of the notice issued under

[[Page 3433]]

Sec. 726.304. No additional time shall be added where service of the 
notice is made by mail.
    (b) The notice of contest shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) State the specific issues to be contested. In particular, the 
person must indicate his agreement or disagreement with:
    (i) The Director's determination that the person against whom the 
penalty is assessed is an operator subject to the requirements of 
section 423 of the Act and Sec. 726.4, or is the president, secretary, 
or treasurer of an operator, if the operator is a corporation.
    (ii) The Director's determination that the operator violated 
section 423 of the Act and Sec. 726.4 for the time period in question; 
and
    (iii) The Director's determination of the amount of penalty owed.
    (4) Be signed by the person making the request or an authorized 
representative of such person; and
    (5) Include the address at which such person or authorized 
representative desires to receive further communications relating 
thereto.
    (c) A notice of contest filed by the operator shall be deemed a 
notice of contest on behalf of all other persons to the Director's 
determinations that the operator is subject to section 423 of the Act 
and Sec. 726.4 and that the operator violated those provisions for the 
time period in question, and to the Director's determination of the 
amount of penalty owed. An operator may not contest the Director's 
determination that a person against whom the penalty is assessed is the 
president, secretary, or treasurer of the operator.
    (d) Failure to specifically identify an issue as contested pursuant 
to paragraph (b)(3) of this section shall be deemed a waiver of the 
right to contest that issue.


Sec. 726.308   Service and computation of time.

    (a) Service of documents under this part shall be made by delivery 
to the person, an officer of a corporation, or attorney of record, or 
by mailing the document to the last known address of the person, 
officer, or attorney. If service is made by mail, it shall be 
considered complete upon mailing. Unless otherwise provided in this 
subpart, service need not be made by certified mail. If service is made 
by delivery, it shall be considered complete upon actual receipt by the 
person, officer, or attorney; upon leaving it at the person's, 
officer's or attorney's office with a clerk or person in charge; upon 
leaving it at a conspicuous place in the office if no one is in charge; 
or by leaving it at the person's or attorney's residence.
    (b) If a complaint has been filed pursuant to Sec. 726.309 of this 
part, two copies of all documents filed in any administrative 
proceeding under this subpart shall be served on the attorneys for the 
Department of Labor. One copy shall be served on the Associate 
Solicitor, Black Lung Benefits Division, Room N-2605, Office of the 
Solicitor, U.S. Department of Labor, 200 Constitution Ave., N.W., 
Washington, DC 20210, and one copy on the attorney representing the 
Department in the proceeding.
    (c) The time allowed a party to file any response under this 
subpart shall be computed beginning with the day following the action 
requiring a response, and shall include the last day of the period, 
unless it is a Saturday, Sunday, or federally-observed holiday, in 
which case the time period shall include the next business day.


Sec. 726.309   Referral to the Office of Administrative Law Judges.

    (a) Upon receipt of a timely notice of contest filed in accordance 
with Sec. 726.307, the Director, by the Associate Solicitor for Black 
Lung Benefits or the Regional Solicitor for the Region in which the 
violation occurred, may file a complaint with the Office of 
Administrative Law Judges. The Director may, in the complaint, reduce 
the total penalty amount requested. A copy of the notice of initial 
assessment issued by the Director and all notices of contest filed in 
accordance with Sec. 726.307 shall be attached. A notice of contest 
shall be given the effect of an answer to the complaint for purposes of 
the administrative proceeding, subject to any amendment that may be 
permitted under this subpart and 29 CFR part 18.
    (b) A copy of the complaint and attachments thereto shall be served 
by counsel for the Director on the person who filed the notice of 
contest.
    (c) The Director, by counsel, may withdraw a complaint filed under 
this section at any time prior to the date upon which the decision of 
the Department becomes final by filing a motion with the Office of 
Administrative Law Judges or the Secretary, as appropriate. If the 
Director makes such a motion prior to the date on which an 
administrative law judge renders a decision in accordance Sec. 726.313, 
the dismissal shall be without prejudice to further assessment against 
the operator for the period in question.


Sec. 726.310   Appointment of Administrative Law Judge and notification 
of hearing date.

    Upon receipt from the Director of a complaint filed pursuant to 
Sec. 726.309, the Chief Administrative Law Judge shall appoint an 
Administrative Law Judge to hear the case. The Administrative Law Judge 
shall notify all interested parties of the time and place of the 
hearing.


Sec. 726.311   Evidence.

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) Notwithstanding 29 CFR 18.1101(b)(2), subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges shall apply to administrative proceedings 
under this part, except that documents contained in Department of Labor 
files and offered on behalf of the Director shall be admissible in 
proceedings under this subpart without regard to their compliance with 
the Rules of Practice and Procedure.


Sec. 726.312   Burdens of proof.

    (a) The Director shall bear the burden of proving the existence of 
a violation, and the time period for which the violation occurred. To 
prove a violation, the Director must establish:
    (1) That the person against whom the penalty is assessed is an 
operator, or is the president, secretary, or treasurer of an operator, 
if such operator is a corporation.
    (2) That the operator violated section 423 of the Act and 
Sec. 726.4. The filing of a complaint shall be considered prima facie 
evidence that the Director has searched the records maintained by OWCP 
and has determined that the operator was not authorized to self-insure 
its liability under the Act for the time period in question, and that 
no insurance carrier reported coverage of the operator for the time 
period in question.
    (b) The Director need not produce further evidence in support of 
his burden of proof with respect to the issues set forth in paragraph 
(a) if no party contested them pursuant to Sec. 726.307(b)(3).
    (c) The Director shall bear the burden of proving the size of the 
operator as required by Sec. 726.302, except that if the Director has 
requested the operator to supply information with respect to its size 
under Sec. 726.303 and the operator has not fully complied with that 
request, it shall be presumed that the

[[Page 3434]]

operator has more than 100 employees engaged in coal mine employment. 
The person or persons liable for the assessment shall thereafter bear 
the burden of proving the actual number of employees engaged in coal 
mine employment.
    (d) The Director shall bear the burden of proving the operator's 
receipt of the notification required by Sec. 726.303, the operator's 
prior notice of the applicability of the Black Lung Benefits Act to its 
operations, and the existence of any previous assessment against the 
operator, the operator's principals, or the operator's officers.
    (e) The person or persons liable for an assessment shall bear the 
burden of proving the applicability of the mitigating factors listed in 
Sec. 726.302(d).


Sec. 726.313  Decision and Order of Administrative Law Judge.

    (a) The Administrative Law Judge shall render a decision on the 
issues referred by the Director.
    (b) The decision of the Administrative Law Judge shall be limited 
to determining, where such issues are properly before him or her:
    (1) Whether the operator has violated section 423 of the Act and 
Sec. 726.4;
    (2) Whether other persons identified by the Director as potentially 
severally liable for the penalty were the president, treasurer, or 
secretary of the corporation during the time period in question; and
    (3) The appropriateness of the penalty assessed by the Director in 
light of the factors set forth in Sec. 726.302. The Administrative Law 
Judge shall not render determinations on the legality of a regulatory 
provision or the constitutionality of a statutory provision.
    (c) The decision of the Administrative Law Judge shall include a 
statement of findings and conclusions, with reasons and bases therefor, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, reverse, or modify, 
in whole or in part, the determination of the Director.
    (d) The Administrative Law Judge shall serve copies of the decision 
on each of the parties by certified mail.
    (e) The decision of the Administrative Law Judge shall be deemed to 
have been issued on the date that it is rendered, and shall constitute 
the final order of the Secretary unless there is a request for 
reconsideration by the Administrative Law Judge pursuant to paragraph 
(f) or a petition for review filed pursuant to Sec. 726.314.
    (f) Any party may request that the Administrative Law Judge 
reconsider his or her decision by filing a motion within 30 days of the 
date upon which the decision of the Administrative Law Judge is issued. 
A timely motion for reconsideration will suspend the running of the 
time for any party to file a petition for review pursuant to 
Sec. 726.314.
    (g) Following issuance of the decision and order, the Chief 
Administrative Law Judge shall promptly forward the complete hearing 
record to the Director.


Sec. 726.314  Review by the Secretary.

    (a) The Director or any party aggrieved by a decision of the 
Administrative Law Judge may petition the Secretary for review of the 
decision by filing a petition within 30 days of the date on which the 
decision was issued. Any other party may file a cross-petition for 
review within 15 days of its receipt of a petition for review or within 
30 days of the date on which the decision was issued, whichever is 
later. Copies of any petition or cross-petition shall be served on all 
parties and on the Chief Administrative Law Judge.
    (b) A petition filed by one party shall not affect the finality of 
the decision with respect to other parties.
    (c) If any party files a timely motion for reconsideration, any 
petition for review, whether filed prior to or subsequent to the filing 
of the timely motion for reconsideration, shall be dismissed without 
prejudice as premature. The 30-day time limit for filing a petition for 
review by any party shall commence upon issuance of a decision on 
reconsideration.


Sec. 726.315  Contents.

    Any petition or cross-petition for review shall:
    (a) Be dated;
    (b) Be typewritten or legibly written;
    (c) State the specific reason or reasons why the party petitioning 
for review believes the Administrative Law Judge's decision is in 
error;
    (d) Be signed by the party filing the petition or an authorized 
representative of such party; and
    (e) Attach copies of the Administrative Law Judge's decision and 
any other documents admitted into the record by the Administrative Law 
Judge which would assist the Secretary in determining whether review is 
warranted.


Sec. 726.316  Filing and Service.

    (a) Filing. All documents submitted to the Secretary shall be filed 
with the Secretary of Labor, U.S. Department of Labor, 200 Constitution 
Ave., N.W., Washington, DC 20210.
    (b) Number of copies. An original and four copies of all documents 
shall be filed.
    (c) Computation of time for delivery by mail. Documents are not 
deemed filed with the Secretary until actually received by the 
Secretary either on or before the due date. No additional time shall be 
added where service of a document requiring action within a prescribed 
time was made by mail.
    (d) Manner and proof of service. A copy of each document filed with 
the Secretary shall be served upon all other parties involved in the 
proceeding. Service under this section shall be by personal delivery or 
by mail. Service by mail is deemed effected at the time of mailing to 
the last known address.


Sec. 726.317  Discretionary Review.

    (a) Following receipt of a timely petition for review, the 
Secretary shall determine whether the decision warrants review, and 
shall send a notice of such determination to the parties and the Chief 
Administrative Law Judge. If the Secretary declines to review the 
decision, the Administrative Law Judge's decision shall be considered 
the final decision of the agency. The Secretary's determination to 
review a decision by an Administrative Law Judge under this subpart is 
solely within the discretion of the Secretary.
    (b) The Secretary's notice shall specify:
    (1) The issue or issues to be reviewed; and
    (2) The schedule for submitting arguments, in the form of briefs or 
such other pleadings as the Secretary deems appropriate.
    (c) Upon receipt of the Secretary's notice, the Director shall 
forward the record to the Secretary.


Sec. 726.318  Final decision of the Secretary.

    The Secretary's review shall be based upon the hearing record. The 
findings of fact in the decision under review shall be conclusive if 
supported by substantial evidence in the record as a whole. The 
Secretary's review of conclusions of law shall be de novo. Upon review 
of the decision, the Secretary may affirm, reverse, modify, or vacate 
the decision, and may remand the case to the Office of Administrative 
Law Judges for further proceedings. The Secretary's final decision 
shall be served upon all parties and the Chief Administrative Law 
Judge, in person or by mail to the last known address.


Sec. 726.319  Retention of official record.

    The official record of every completed administrative hearing held 
pursuant to this part shall be maintained and filed under the custody 
and control of the Director.

[[Page 3435]]

Sec. 726.320  Collection and recovery of penalty.

    (a) When the determination of the amount of any civil money penalty 
provided for in this part becomes final, in accordance with the 
administrative assessment thereof, or pursuant to the decision and 
order of an Administrative Law Judge in an administrative proceeding as 
provided in, or following the decision of the Secretary, the amount of 
the penalty as thus determined is immediately due and payable to the 
U.S. Department of Labor on behalf of the Black Lung Disability Trust 
Fund. The person against whom such penalty has been assessed or imposed 
shall promptly remit the amount thereof, as finally determined, to the 
Secretary by certified check or by money order, made payable to the 
order of U.S. Department of Labor, Black Lung Program. Such remittance 
shall be delivered or mailed to the Director.
    (b) If such remittance is not received within 30 days after it 
becomes due and payable, it may be recovered in a civil action brought 
by the Secretary in any court of competent jurisdiction, in which 
litigation the Secretary shall be represented by the Solicitor of 
Labor.

PART 727--[REMOVED]

    6. Under the authority of sections 932 and 936 of the Black Lung 
Benefits Act, part 727 is proposed to be removed.

[FR Doc. 97-44 Filed 1-21-97; 8:45 am]
BILLING CODE 4510-27-P