79920 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

DEPARTMENT OF LABOR

Employment Standards Administration

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

RIN 1215–AA99

Regulations Implementing the Federal

Coal Mine Health and Safety Act of

1969, as Amended

AGENCY: Employment Standards

Administration, Labor.

ACTION: Final rule.

SUMMARY: On January 22, 1997, the

Department issued a proposed rule to

amend the regulations implementing the

Black Lung Benefits Act. 62 FR 3338–

3435 (Jan. 22, 1997). When the comment

period closed on August 21, 1997, the

Department had received written

submissions from almost 200 interested

persons, including coal miners, coal

mine operators, insurers, physicians,

and attorneys. The Department also held

hearings in Charleston, West Virginia,

and Washington, D.C. at which over 50

people testified. The Department

carefully reviewed the testimony and

the comments and, on October 8, 1999,

issued a second notice of proposed

rulemaking. 64 FR 54966–55072 (Oct. 8,

1999). In its second notice, the

Department proposed changing several

of the most important provisions in its

initial proposal. The Department also

explained its decision not to alter the

original proposal with respect to other

key regulations based on the comments

received to date. Finally, the

Department prepared an initial

regulatory flexibility analysis. In order

to ensure that small businesses that

could be affected by the Department’s

proposal received appropriate notice of

the Department’s proposed changes, the

Department mailed a copy of the second

notice of proposed rulemaking to all

coal mine operators contained in the

databases maintained by the Mine

Safety and Health Administration.

The Department initially allowed

interested parties until December 7,

1999 to file comments to its second

proposal, but extended that period until

January 6, 2000. The Department

received 37 written submissions before

the close of the comment period, from

groups representing both coal miners

and coal mine operators. The

Department also received comments

from individual miners, various coal

mining and insurance companies, as

well as from claims processing

organizations, attorneys, and various

professional organizations. The

Department has carefully reviewed all of

the comments, and is issuing its final

rule. The rule contains a final regulatory

flexibility analysis as required by the

Regulatory Flexibility Act.

EFFECTIVE DATE: January 19, 2001.

FOR FURTHER INFORMATION CONTACT:

James L. DeMarce, (202) 693–0046.

SUPPLEMENTARY INFORMATION: The

Department’s final rule reprints 20 CFR

Parts 718 (except Tables B1 through B6

in Appendix B), 722, 725, and 726 in

their entirety. The Department has not

revised all of the regulations in these

parts. A detailed list of the regulations

to which the Department has made

substantive revisions follows the

Summary of Noteworthy Regulations

below, accompanied by a list of

regulations to which the Department has

made technical revisions, a list of

regulations that the Department has

deleted, and a list of regulations that the

Department has not changed in any

manner.

Summary of Noteworthy Provisions

District Director Claims Processing

These final regulations implementing

the Black Lung Benefits Act provide

simplified administrative procedures for

the adjudication of claims pending

before the Office of Workers’

Compensation Programs (OWCP). The

new streamlined procedures are less

formal and should be easier for claims

participants to understand. They require

the district director to issue fewer

documents and therefore involve fewer

procedural steps and deadlines. They

also require fewer responses from the

parties. These changes are in response

to the many comments the Department

has received asking that OWCP’s

procedures be simplified and made less

formal and adversarial.

In its initial notice of proposed

rulemaking, the Department announced

its intent to amend these regulations

with the goal of helping to improve

services, streamline the adjudication

process and simplify the regulations’

language. The Department noted

OWCP’s many years of experience

administering the program and the

variety of ideas for change which had

resulted from it. 62 FR 3338 (Jan. 22,

1997). In the second notice of proposed

rulemaking, the Department emphasized

its commitment to improve the quality

of the information it provides the parties

to a black lung claim. As part of this

commitment, the Department noted its

intent to substantially rewrite the

documents used by district directors to

notify parties of the ‘‘initial findings’’ on

their claims. The Department stated its

goal was to help make claim processing

by district offices easier to understand

and to give claimants a clear picture of

the medical evidence developed in

connection with their claims so that

they were able to make more informed

decisions as to how to proceed. The

Department also noted that it had

attempted to ‘‘eliminat[e] the hierarchy

of response times’’ at the district

director level. 64 FR 54992 (Oct. 8,

1999). After the receipt of many

comments addressing its proposals, the

Department has determined that a more

comprehensive streamlining of district

director procedures is warranted.

The Department has therefore

eliminated the use of initial findings

and the required responses to them, as

well as the district director’s initial

adjudication as proposed in §§ 725.410–

725.413. Similarly, the Department has

altered the rules governing informal

conferences, § 725.416. If a conference is

held, no memorandum of conference

will result, § 725.417(c). Instead, OWCP

will issue only one decisional document

at the conclusion of the district

director’s processing of a claim: in most

cases a proposed decision and order,

§ 725.418. The proposed decision and

order will give rise to the thirty-day

period for requesting a hearing before

the Office of Administrative Law Judges

and, if no such hearing is requested, to

the one-year period for filing a request

for modification, § 725.419. The

proposed decision and order will also

contain the district director’s final

designation of the responsible operator

liable for the payment of benefits, and

the dismissal of all other potentially

liable operators that had previously

received notice of the claim.

The Department hopes that the

absence of documents with titles such

as ‘‘initial findings’’ and ‘‘memorandum

of conference’’ will encourage a less

adversarial and less formal development

of the necessary evidence and will

promote more timely evidentiary

development. As previously proposed,

the district director will engage in a

preliminary gathering of the relevant

evidence. He will develop medical

evidence, including the complete

pulmonary evaluation, §§ 725.405–

725.406. He will identify and notify

those coal mine operators among the

claimant’s former employers which he

deems to be potentially liable operators,

§ 725.407, and gather evidence from

them regarding their employment of the

miner and their status as operators,

§ 725.408. At the conclusion of this

evidence-gathering, however, rather

than issue an initial finding (a

document with the appearance of a

preliminary adjudication of the claim),

the district director will issue a

schedule for the submission of

additional evidence, § 725.410. This

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79921

document will contain a summary of the

results of the complete pulmonary

evaluation and the district director’s

preliminary analysis of that evidence.

The analysis will include a discussion

of any of the elements of entitlement

that appear not to have been established

and why. The schedule will also contain

the district director’s designation of a

responsible operator liable for the

payment of claimant’s benefits. If the

designated responsible operator is not

the miner’s last employer, the district

director will include with the schedule

the statements necessary to comply with

§ 725.495(d).

The schedule will allow the claimant

and the designated responsible operator

not less than 60 days to submit

additional evidence, including evidence

relevant to the claimant’s entitlement to

benefits and the employer’s liability for

them. The schedule will also allow at

least an additional 30 days within

which to respond to evidence the other

party submits, § 725.410(b). These time

periods may be extended for good cause

shown, § 725.423. The district director

will serve the schedule by certified mail

on all parties and will include with it

copies of all relevant evidence,

§ 725.410(c). The schedule will also

inform the claimant and the designated

responsible operator of their rights,

including the right to submit additional

evidence and the right to further

adjudication of the claim,

§ 725.410(a)(4). Finally, the schedule

will notify the claimant that he has the

right to obtain representation and that,

if the designated responsible operator

fails to accept the claimant’s entitlement

within the specified time and the

claimant establishes his entitlement to

benefits payable by that operator, the

responsible operator will be liable for a

reasonable attorney’s fee.

The new procedure requires a

responsible operator to respond within

30 days as to the liability designation in

the schedule, § 725.412(a)(1). Silence on

the responsible operator’s part will be

deemed an acceptance of the district

director’s designation as to its liability.

Silence on the operator’s part with

respect to claimant’s entitlement,

however, will be deemed a

controversion. If the operator wishes to

accept a claimant’s entitlement to

benefits, it must file a statement

indicating this intent within 30 days of

issuance of the district director’s

schedule, § 725.412(b). Thus, this

schedule requires a less comprehensive

operator response than the initial

findings would have. The responsible

operator must file a response only to

contest its liability and/or to accept a

claimant’s entitlement to benefits. In

addition, fewer parties are required to

respond to the schedule since the

claimant need not respond at all.

By contrast, if the district director

concludes that there is no operator

responsible for the payment of benefits

and that the results of the complete

pulmonary evaluation support a finding

of eligibility, the district director shall

issue a proposed decision and order

awarding the claimant benefits,

§ 725.411. In such a case, no schedule

for the submission of additional

evidence is necessary, and no claimant

response to the proposed decision and

order is required.

At the conclusion of the time

scheduled for the submission of

additional evidence, § 725.415(b), the

district director may either notify

additional operators of their potential

liability for benefits under § 725.407,

issue another schedule for the

submission of additional evidence

identifying another potentially liable

operator as the responsible operator

liable for the payment of benefits,

§ 725.410, schedule a case for an

informal conference, § 725.416, or issue

a proposed decision and order,

§ 725.418. In the event the district

director issues another schedule for the

submission of additional evidence

pursuant to § 725.410, the district

director shall not permit the

development or submission of any

additional medical evidence until after

he has determined the responsible

operator liable for the payment of

benefits. If the operator determined to

be the responsible operator has not had

the opportunity to submit medical

evidence, the district director shall

afford that operator the opportunity

outlined in § 725.410. The designated

responsible operator may elect to adopt

any medical evidence previously

submitted by another operator as its

own, subject to the § 725.414

limitations.

The regulations also contain

significant modifications to the informal

conference procedure in order to reduce

delay and to ensure that conferences are

held only in appropriate cases. Thus, if

an informal conference is scheduled, it

must be held within 90 days of the

conclusion of the evidentiary

development period unless a party

requests that it be postponed for good

cause, § 725.416(a). A district director

may schedule a conference only if all

the parties to a claim are represented or

deemed represented, although lay

representation is sufficient, § 725.416(b).

If all the pertinent requirements are met,

however, and an informal conference is

scheduled, the unexcused failure of a

party to appear constitutes grounds for

the imposition of sanctions,

§ 725.416(c). These sanctions may

include denial of the claim by reason of

abandonment, § 725.409(a)(4). In the

event an ALJ ultimately reviews the

denial by reason of abandonment and

concludes that it was improper, he may

proceed to address the merits of the

claim, but only with the written

agreement of the Director, § 725.409(c).

In most cases, however, at the

conclusion of either the evidentiary

development period or informal

conference proceedings, the district

director will issue a proposed decision

and order setting forth his findings and

conclusions with respect to the claim. In

order to reduce the delay caused by

informal conferences, the regulations

require issuance of a proposed decision

and order within 20 days after the

conclusion of all informal conference

proceedings, § 725.418(a). The proposed

decision and order will contain the

district director’s final designation of

the responsible operator liable for the

payment of benefits, and will dismiss,

as parties to the claim, all other

potentially liable operators that received

notification pursuant to § 725.407. Any

party may request a hearing within 30

days of issuance of the decision and

order, § 725.419(a). If no party responds

to the proposed decision, it shall

become final and effective upon the

expiration of the 30-day period and no

further proceedings with respect to the

claim shall be possible, except for the

filing of a request for modification,

§ 725.419(d).

The Department hopes that this

simplified procedure will reduce, if not

eliminate, hearing requests filed before

the conclusion of a district director’s

claims processing. In the event a hearing

request is filed before a district director

has concluded his adjudication of the

claim, however, OWCP will honor the

request at the conclusion of processing

in the absence of a party’s affirmative

statement that it no longer desires a

hearing. Thus, if a claimant has

previously requested a hearing and has

been denied benefits in a proposed

decision and order, the case will be

forwarded to the Office of

Administrative Law Judges for hearing

in the absence of a statement that a

hearing is no longer desired. Similarly,

if an operator has previously requested

a hearing, and the proposed decision

and order awards the claimant benefits,

OWCP will forward the claim for

hearing absent a statement from the

operator that it no longer desires a

hearing, § 725.418(c).

79922 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Evidentiary Development

Documentary Evidence

With one substantive addition and

several deletions, these final rules

implement the Department’s second

proposal with respect to the

development of both documentary

medical evidence and evidence

pertaining to operator liability. The

designated responsible operator may

submit documentary medical evidence

either to the district director or to the

administrative law judge (ALJ) up to 20

days before an ALJ hearing, or even

thereafter, if good cause is shown.

Documentary medical evidence may

only be submitted up to the numerical

limitations outlined in §§ 725.414(a),

however, absent a showing of good

cause, § 725.456(b). Thus, each side in

a claim may submit two chest x-ray

interpretations, the results of two

pulmonary function tests, two arterial

blood gas studies and two medical

reports as its affirmative case. In

addition, each party may submit one

piece of evidence in rebuttal of each

piece of evidence submitted by the

opposing party. Finally, in a case in

which rebuttal evidence has been

submitted, the party that originally

proferred the evidence which has been

the subject of rebuttal may submit one

additional statement to rehabilitate its

evidence.

By contrast, documentary evidence as

to operator liability must be submitted

to the district director, absent a showing

of exceptional circumstances,

§§ 725.408(b)(2), 725.414(d), 725.456(b).

There is no limit on the amount of such

evidence that may be submitted,

however.

At the urging of commenters

representing both industry and

claimants, the Department has made one

addition to § 725.414(a). The

Department has added a specific

limitation on the amount of autopsy and

biopsy evidence which may be

submitted in a claim. Each side may

submit one autopsy report and one

report of each biopsy as part of an

affirmative case. Each side may submit

one autopsy report and one report of

each biopsy in rebuttal of the

opponent’s case. Finally, where the

original autopsy or biopsy evidence has

been the subject of rebuttal, the party

that submitted the original report may

submit an additional statement from the

physician who authored that report.

The Department has deleted language

throughout § 725.414 referring to

potentially liable operators since only

the designated responsible operator

and/or the Trust Fund will have the

authority to develop documentary

medical evidence in a claim. The

Department has also deleted one

provision of proposed § 725.414,

§ 725.414(e), as well as the comparable

provision proposed as § 725.456(c).

These subsections would have provided

that any evidence obtained by a party

while a claim was pending before a

district director but withheld from the

district director or any other party shall

not be admitted into the record in any

later proceedings in the absence of

extraordinary circumstances unless its

admission is requested by another party.

Commenters opposed these provisions,

and the Department has agreed to delete

them. The Department believes they are

no longer necessary, given the

significant alteration in the district

director’s methods for gathering

evidence under the new regulations, see

preamble to § 725.456. In addition, these

rules would have posed a danger to

parties who are unrepresented before

the district director and might have run

afoul of the rules unintentionally.

Complete Pulmonary Evaluation

With one exception, these final rules

implement the Department’s second

proposal with respect to the

administration of the complete

pulmonary evaluation required by 30

U.S.C. 923(b). The Department will

allow each claimant to select the

physician or facility to perform his

evaluation from a list of authorized

providers maintained by the

Department. The list in each case will

include all authorized physicians and

facilities in the state of the miner’s

residence and contiguous states,

§ 725.406(b). The Department will also

make available to the claimant’s treating

physician, at the claimant’s request, the

results of the objective testing

administered as part of the complete

pulmonary evaluation and will inform

the claimant that any opinion submitted

by his treating physician will count as

one of the two medical reports that the

miner may submit, § 725.406(d).

The Department has not included in

the final regulation at § 725.406,

however, the provision proposed as

subsection (e) which would have

allowed the district director to require

the claimant to be reexamined after the

completion of the complete pulmonary

evaluation if the district director

believed that unresolved medical

questions remained. Commenters from

both industry and claimants’ groups

opposed this provision, and the

Department has concluded it is no

longer necessary. The complete

pulmonary evaluation will now be

performed by a highly qualified

physician who may be asked by the

district director to clarify and/or

supplement an initial report if

unresolved medical questions remain.

In addition, the components of the

complete pulmonary evaluation are to

be in substantial compliance with the

applicable quality standards and the

district director retains authority

elsewhere in § 725.406 to schedule the

miner for further examination or testing

to ensure compliance with these

standards.

In the second notice of proposed

rulemaking, the Department also

announced its intent to perform the best

possible respiratory and pulmonary

evaluation of miners applying for

benefits. The Department promised a

thorough examination, performed in

compliance with the quality standards,

in order to provide each claimant with

a realistic appraisal of his condition and

the district director with a sound

evidentiary basis for a preliminary

evaluation of the claim. The Department

also announced its intent to develop

more rigorous standards for physicians

who perform complete pulmonary

evaluations. The Department invited the

interested public to comment on the

possible standards that might be used to

select physicians and facilities, 64 FR

54988–54989 (Oct. 8, 1999).

The comments the Department

received are discussed in detail in the

preamble to § 725.406. It is the

Department’s intent, however, to

include in its Black Lung Program

Manual the requirements for a

physician’s or medical facility’s

inclusion on the list. The Manual is

available to the public in every district

office of OWCP. Thus, the requirements

for participation in OWCP’s program

and the manner in which the

Department has used those

requirements to select physicians for

inclusion on the approved list will be

public information. The Department

does not intend to screen the contents

of physicians’ prior reports and

testimony before including them on the

list. The Department intends only to

ascertain that the required professional

credentials are present.

Witnesses

These final rules adopt the provisions

governing witness testimony proposed

in the Department’s second notice of

proposed rulemaking. No person shall

be permitted to testify as a witness at a

hearing, pursuant to deposition or by

interrogatory unless that person meets

the requirements of § 725.414(c). Thus,

in the case of a witness offering

testimony relevant to the liability of a

potentially liable operator or the

identification of a responsible operator,

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79923

the witness must have been identified

while the claim was pending before the

district director in the absence of

extraordinary circumstances,

§ 725.457(c)(1). In the case of a

physician offering testimony relevant to

the physical condition of the miner, the

physician must have prepared a medical

report submitted into evidence.

Alternatively, the party offering the

physician’s testimony must have

submitted fewer than two medical

reports into evidence in which case the

physician’s testimony shall be

considered a medical report for the

purpose of the evidentiary limitations in

§ 725.414(c). A party may offer the

testimony of more than two physicians

only upon a finding of good cause,

§ 725.457(c)(2).

Treating Physicians’ Opinions

The Department has adopted a rule

governing the weighing of treating

physicians’ opinions similar to the one

proposed in its second notice of

proposed rulemaking, § 718.104(d). The

rule is discussed in detail in the

preamble to § 718.104. The language of

§ 718.104(d) has been altered to provide

that, in appropriate cases, the

relationship between the miner and his

treating physician may constitute

substantial evidence in support of the

adjudication officer’s decision to give

that physician’s opinion controlling

weight. See § 718.104(d)(5). The rule’s

purpose is to recognize that a

physician’s professional relationship

with the miner may enhance his insight

into the miner’s pulmonary condition. A

treating physician may develop a more

in-depth knowledge and understanding

of the miner’s respiratory and

pulmonary condition than a physician

who examines the miner only once or

who reviews others’ examination

reports. Section 718.104(d) is not an

outcome-determinative evidentiary rule,

however. It does not preclude

consideration of other relevant evidence

of record. Rather, it provides criteria for

evaluating the quality of the doctorpatient relationship. The criteria at

§ 718.104(d)(1)–(4) are indicia of the

potential insight the physician may

have gained from on-going treatment of

the miner. The rule is designed to force

a careful and thorough assessment of the

treatment relationship. If the adjudicator

concludes the treating physician has a

special understanding of the miner’s

pulmonary health, that opinion may

receive ‘‘controlling weight’’ over

contrary opinions. That determination

may be made, however, only after the

adjudicator considers the credibility of

the physician’s opinion in light of its

documentation and reasoning and the

relative merits of the other relevant

medical evidence of record.

Definition of Pneumoconiosis and

Establishing Total Disability Due to

Pneumoconiosis

The Department has adopted the

proposed definition of pneumoconiosis

without alteration. In the preamble to

§ 718.201, the Department explains that

the term ‘‘legal pneumoconiosis’’ does

not create a new medical diagnosis, but

rather reflects the statute’s definition of

the disease as ‘‘a chronic dust disease of

the lung and its sequelae, including

respiratory and pulmonary

impairments, arising out of coal mine

employment.’’ 30 U.S.C. 902(b). The

preamble also explains in detail the

Department’s decision to include

chronic obstructive pulmonary disease

in the definition of pneumoconiosis to

the extent it is shown to have arisen

from coal mine employment. The

Department attempts to clarify that not

all obstructive lung disease is

pneumoconiosis. It remains the

claimant’s burden of persuasion to

demonstrate that his obstructive lung

disease arose out of his coal mine

employment and therefore falls within

the statutory definition of

pneumoconiosis. The Department has

concluded, however, that the prevailing

view of the medical community and the

substantial weight of the medical and

scientific literature supports the

conclusion that exposure to coal mine

dust may cause chronic obstructive

pulmonary disease. Each miner must

therefore be given the opportunity to

prove that his obstructive lung disease

arose out of his coal mine employment

and constitutes ‘‘legal’’ pneumoconiosis.

The Department has also adopted the

proposed regulation defining total

disability and disability due to

pneumoconiosis with one alteration,

§ 718.204. To clarify its original intent

concerning the extent to which

pneumoconiosis must contribute to a

miner’s total disability, the Department

has amended the language of

§§ 718.204(c)(1)(i) and 718.204(c)(1)(ii)

by adding the words ‘‘material’’ and

‘‘materially.’’ Thus, a miner has

established that his pneumoconiosis is a

substantially contributing cause of his

disability if it either has a material

adverse effect on his respiratory or

pulmonary condition or materially

worsens a totally disabling respiratory

or pulmonary impairment caused by a

disease or exposure unrelated to coal

mine dust. Evidence that

pneumoconiosis made only a negligible,

inconsequential or insignificant

contribution to the miner’s disability is

insufficient to establish total disability

due to pneumoconiosis. This change is

discussed in detail in the preamble at

§ 718.204. The Department has also

adopted one important proposed change

with respect to the clinical evidence

which may be used to establish total

disability, see preamble to § 718.103.

The Department has concluded that the

claims adjudication process would

benefit by making mandatory the use of

the flow-volume loop in pulmonary

function testing (spirometry testing).

The Department has previously noted

that the test, conducted in this manner,

provides a ‘‘more reliable method of

ensuring valid, verifiable results

* * *.’’ 64 FR 54975 (Oct. 8, 1999). In

the second notice of proposed

rulemaking, the Department announced

its intent to conduct a survey of

physicians, clinics and facilities which

perform pulmonary function testing to

evaluate the prevalence of spirometers

capable of producing a flow-volume

loop. The Department has now

evaluated the results of its survey and

has concluded that the prevalence of the

necessary equipment and the

willingness of those physicians who do

not currently have it to buy it, warrant

the mandatory usage of such equipment.

Subsequent Claims

These final rules adopt the regulation

governing subsequent claims that was

proposed in the Department’s second

notice of proposed rulemaking. A

subsequent claim is an application for

benefits filed more than one year after

the denial of a previous claim. It may be

adjudicated on its merits only if the

claimant demonstrates that an

applicable condition of entitlement has

changed in the interim. In the second

proposal, the Department justified the

rule by noting that ‘‘allowing the filing

of a subsequent claim for benefits which

alleges a worsening of the miner’s

condition, * * * merely recognizes the

progressive nature of pneumoconiosis.’’

64 FR 54968 (Oct. 8, 1999). In the

preamble to § 725.309, the Department

responds in detail to those commenters

who oppose the regulation. They argue,

in part, that the Department’s

recognition of pneumoconiosis as a

latent and progressive disease is

scientifically unsound. The Department

has summarized the scientific and

medical evidence supporting its view

that pneumoconiosis is both latent and

progressive and has responded to the

criticism leveled at that evidence. It is

the Department’s conclusion that the

record contains abundant evidence to

justify the regulation governing

subsequent claims.

79924 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Attorneys’ Fees

With minor changes, these final rules

promulgate the regulation governing the

payment of a claimant’s attorney’s fee as

it was proposed in the Department’s

second notice of proposed rulemaking,

§ 725.367. The Department wishes to

encourage attorneys to represent

claimants early in the administrative

process, given the important decisions

which may be made by a claimant while

a claim is pending before the district

director. For example, the rules now

limit the quantity of medical evidence

that a claimant may submit in support

of his entitlement. A claimant may

request that the Department send the

objective test results from his complete

pulmonary evaluation to his treating

physician. Any treating physician’s

opinion which is submitted to the

district director, however, may become

one of the claimant’s two medical

reports. The Department’s rule

governing attorney’s fees, therefore,

seeks to encourage early attorney

involvement by providing a different

starting point for employer and Fund

attorney fee liability. Although the

creation of an adversarial relationship

and the ultimately successful

prosecution of a claim are still necessary

to trigger employer or Fund liability,

once that liability is triggered, a

reasonable fee will be awarded for all

necessary work performed, even if it

was performed before the creation of the

adversarial relationship.

The text of the regulation has been

altered in minor ways. The language

describing the fee to which an attorney

is entitled has been amended to conform

with § 725.366. Section 725.367

therefore provides for the payment of a

‘‘reasonable fee[] for necessary services

performed. * * *’’ In addition, the

regulation has been amended to

conform with the revised district

director claims procedure. Thus,

§ 725.367(a)(1) now provides that if the

responsible operator designated by the

district director pursuant to

§ 725.410(a)(3) fails to accept the

claimant’s entitlement to benefits within

the 30 day period provided by

§ 725.412(b) and is ultimately

determined to be liable for benefits, the

operator shall also be liable for a

reasonable attorney’s fee. Similarly, if

there is no operator that may be held

liable for the payment of benefits, the

district director issues a schedule for the

submission of additional evidence

under § 725.410, and the claimant

successfully prosecutes his application

for benefits, the Fund will be liable for

a reasonable attorney’s fee,

§ 725.367(a)(2). Finally, if the district

director issues more than one schedule

for the submission of additional

evidence in order to designate a

different operator as the responsible

operator, and that operator is ultimately

determined to be liable for the payment

of benefits, that operator will be liable

for the payment of claimant’s attorney’s

fee if it fails to accept the claimant’s

entitlement within 30 days of the date

upon which it is notified of its

designation as responsible operator.

True Doubt

The Department has not adopted a

‘‘true doubt’’ rule in these regulations.

The ‘‘true doubt’’ rule was an

evidentiary weighing principle under

which an issue was resolved in favor of

the claimant if the probative evidence

for and against the claimant was in

equipoise. The Department believes that

evaluation of conflicting medical

evidence requires careful consideration

of a wide variety of disparate factors

affecting the credibility of that evidence.

The presence of these factors makes it

unlikely that a factfinder will be able to

conclude that conflicting evidence is

truly in equipoise. See preamble to

§ 718.3.

Criteria for Determining a Responsible

Operator

The Department has made two

changes to the regulation governing the

identification of a responsible operator,

§ 725.495. That regulation now provides

that if the miner’s most recent employer

was a self-insured operator which no

longer possesses sufficient assets to

secure the payment of benefits when the

miner files his claim, the Department

will not name a previous employer as

responsible operator. Rather, the claim

will be the responsibility of the Black

Lung Disability Trust Fund. The

Department has made this change in

response to a comment that stated that

it is unfair to name a prior employer as

liable for a claim when the financial

inability of the later employer to pay the

claim is the fault of the Department.

Because the Department has the

authority to accept or reject applications

for self-insurance and to set minimum

standards for qualifying as a selfinsurer, the Department agrees with the

commenter. Thus, to the extent the

security deposited by a self-insured coal

mine operator pursuant to § 726.104

proves insufficient to pay individual

claims, liability will not be placed on

previous employers, but rather on the

Trust Fund. The Department has also

altered the language of § 725.495(d) to

reflect the changes made in the

regulations governing district director

claims processing, §§ 725.410–725.413.

The district director will no longer issue

an initial finding naming a responsible

operator but rather will finally designate

in a proposed decision and order one

operator as the responsible operator

liable for a claim, § 725.418(d).

Insurance Endorsement

In the second notice of proposed

rulemaking, the Department opened

§ 726.203 for comment, noting that

representatives of the insurance

industry had told the Department that a

different version of the insurance

endorsement than the one contained in

§ 726.203(a) had been in use since 1984

with the Department’s consent. The

Department invited the submission of

any document the insurance industry

might possess from the Department

authorizing use of the different

endorsement. 64 FR 54969–70, 55005–

06 (Oct. 8, 1999). The Department has

carefully considered the comments

submitted in response to the second

notice of proposed rulemaking and

declines to amend § 726.203. The

revised black lung endorsement offered

by the commenters would materially

alter the obligations and coverage

provided by the insurance industry,

thereby increasing the potential

exposure of coal mine operators and the

Black Lung Disability Trust Fund, see

preamble to § 726.203.

Explanation of Changes

Complete List of Substantive Revisions

The Department has made substantive

revisions to the following regulations:

§ 718.3, § 718.101, § 718.102, § 718.103,

§ 718.104, § 718.105, § 718.106,

§ 718.107, § 718.201, § 718.202,

§ 718.204, § 718.205, § 718.301,

Appendix B to part 718, Appendix C to

Part 718, part 722 (entire), § 725.1,

§ 725.2, § 725.4, § 725.101, § 725.103,

§ 725.202, § 725.203, § 725.204,

§ 725.209, § 725.212, § 725.213,

§ 725.214, § 725.215, § 725.219,

§ 725.221, § 725.222, § 725.223,

§ 725.306, § 725.309, § 725.310,

§ 725.311, § 725.351, § 725.362,

§ 725.367, § 725.403, § 725.405,

§ 725.406, § 725.407, § 725.408,

§ 725.409, § 725.410, § 725.411,

§ 725.412, § 725.413, § 725.414,

§ 725.415, § 725.416, § 725.417,

§ 725.418, § 725.421, § 725.423,

§ 725.452, § 725.454, § 725.456,

§ 725.457, § 725.458, § 725.459,

§ 725.465, § 725.478, § 725.479,

§ 725.490, § 725.491, § 725.492,

§ 725.493, § 725.494, § 725.495,

§ 725.502, § 725.503, § 725.515,

§ 725.522, § 725.530, § 725.533,

§ 725.537, § 725.543, § 725.544,

§ 725.547, § 725.548, § 725.606,

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79925

§ 725.608, § 725.609, § 725.620,

§ 725.621, § 725.701, § 725.706, § 726.2,

§ 726.3, § 726.8, § 726.101, § 726.104,

§ 726.105, § 726.106, § 726.109,

§ 726.110, § 726.111, § 726.114,

§ 726.300, § 726.301, § 726.302,

§ 726.303, § 726.304, § 726.305,

§ 726.306, § 726.307, § 726.308,

§ 726.309, § 726.310, § 726.311,

§ 726.312, § 726.313, § 726.314,

§ 726.315, § 726.316, § 726.317,

§ 726.318, § 726.319, and § 726.320.

Detailed explanations of the reasons for

the Department’s revisions may be

found in the discussion of individual

regulations below.

Complete List of Technical Revisions

The Department has made only

technical changes to the following

regulations: § 718.1, § 718.2, § 718.4,

718.303, Appendix A to Part 718,

§ 725.3, § 725.102, § 725.201, § 725.206,

§ 725.207, § 725.216, § 725.217,

§ 725.218, § 725.220, § 725.301,

§ 725.302, § 725.350, § 725.360,

§ 725.366, § 725.401, § 725.402,

§ 725.404, § 725.419, § 725.420,

§ 725.450, § 725.451, § 725.455,

§ 725.462, § 725.463, § 725.466,

§ 725.480, § 725.496, § 725.497,

§ 725.501, § 725.504, § 725.505,

§ 725.506, § 725.507, § 725.510,

§ 725.513, § 725.514, § 725.521,

§ 725.531, § 725.532, § 725.536,

§ 725.540, § 725.601, § 725.603,

§ 725.604, § 725.605, § 725.607,

§ 725.702, § 725.703, § 725.704,

§ 725.705, § 725.707, § 725.708,

§ 725.711, § 726.1, § 726.4, § 726.103,

§ 726.203, § 726.207, § 726.208,

§ 726.209, § 726.210, § 726.211,

§ 726.212, and § 726.213. In its first

notice of proposed rulemaking, the

Department revised § 725.3 to create a

new subpart E in part 725, and to

recognize the relabeling of the

remaining subparts. The Department

inadvertently omitted the regulation

from the list of technical revisions,

however. Accordingly, § 725.3 now

appears in the complete list of technical

revisions. The Department also

inadvertently omitted §§ 725.206 and

725.540 from the list of technical

revisions. The Department added a

reference to § 725.4(d) to each

regulation, see 62 FR 3340–41 (Jan. 22,

1997). The Department also

inadvertently omitted § 725.207 from

the list of technical revisions. The

Department replaced commas in

subsections (b) and (c) with the word

‘‘and.’’ The Department also

inadvertently omitted § 725.497 from

the list of technical revisions. The

Department replaced references to the

‘‘Trust Fund’’ with references to the

‘‘fund,’’ the term defined in

§ 725.101(a)(8), and capitalized the

word ‘‘section’’ in subsections (a) and

(b). Finally, the Department

inadvertently omitted § 725.601 from

the list of technical revisions. The

Department replaced references to

‘‘deputy commissioner’’ with references

to ‘‘district director,’’ see 62 FR 3340

(Jan. 22, 1997), and replaced a reference

to the ‘‘Trust Fund’’ with a reference to

the ‘‘fund.’’ The Department explained

the other technical changes that it was

making to the regulations in its first and

second notices of proposed rulemaking.

See 62 FR 3340–41 (Jan. 22, 1997); 64

FR 54970 (Oct. 8, 1999). With the

exception of § 726.203, none of the

regulations listed above were open for

comment. The Department’s decision

not to revise § 726.203, other than the

technical revisions discussed in the

Department’s first notice of proposed

rulemaking, is explained in the

preamble to § 726.203.

Complete List of Deleted Regulations

The following regulations have been

deleted: § 718.307, § 718.401, § 718.402,

§ 718.403, § 718.404, § 725.453A,

§ 725.459A, § 725.503A, § 725.701A,

and part 727 (entire). The Department

explained its decision to incorporate the

text of sections 725.453A, 725.459A,

725.503A, and 725.701A into other

regulations in its first notice of proposed

rulemaking. See list of Technical

revisions, 62 FR 3341 (Jan. 22, 1997).

Detailed explanations of the

Department’s decision to delete the

remaining regulations in this list may be

found in the discussion of individual

regulations below.

Complete List of Unchanged

Regulations

The following regulations have not

been revised: § 718.203, § 718.206,

§ 718.302, § 718.304, § 718.305,

§ 718.306, § 725.205, § 725.208,

§ 725.210, § 725.211, § 725.224,

§ 725.225, § 725.226, § 725.227,

§ 725.228, § 725.229, § 725.230,

§ 725.231, § 725.232, § 725.233,

§ 725.303, § 725.304, § 725.305,

§ 725.307, § 725.308, § 725.352,

§ 725.361, § 725.363, § 725.364,

§ 725.365, § 725.422, § 725.453,

§ 725.460, § 725.461, § 725.464,

§ 725.475, § 725.476, § 725.477,

§ 725.481, § 725.482, § 725.483,

§ 725.511, § 725.512, § 725.520,

§ 725.534, § 725.535, § 725.538,

§ 725.539, § 725.541, § 725.542,

§ 725.545, § 725.546, § 725.602,

§ 725.710, § 726.5, § 726.6, § 726.7,

§ 726.102, § 726.107, § 726.108,

§ 726.112, § 726.113, § 726.115,

§ 726.201, § 726.202, § 726.204,

§ 726.205, and § 726.206. The

Department did not accept comments on

these regulations, and is repromulgating the regulations for the

convenience of readers.

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

(a)(i) In the initial notice of proposed

rulemaking, the Department invited

public comment on the continued use of

the ‘‘true doubt’’ rule, and specifically

on the language contained in § 718.3(c),

which had been cited to the Supreme

Court in support of the rule. 62 FR 3341

(Jan. 22, 1997). The ‘‘true doubt’’ rule is

an evidentiary principle which requires

the adjudicator to find in favor of the

claimant on a factual issue if the

evidence for and against the claimant is

evenly balanced. The Supreme Court

invalidated the ‘‘true doubt’’ rule in

Director, OWCP v. Greenwich Collieries,

512 U.S. 267 (1994). The Court held

§ 718.3(c) failed to define the rule

effectively, and that the rule, as applied

by the Benefits Review Board, violated

the Administrative Procedure Act

(APA), 5 U.S.C. 551 et seq., by relieving

the claimant of the burden of proving

his or her claim by a preponderance of

the evidence (the ‘‘burden of

persuasion’’). The Department therefore

proposed deleting § 718.3(c) and moving

the existing 20 CFR 718.403 (1999)

(‘‘Burden of proof’’) to proposed

§ 725.103. (ii) In the second notice of

proposed rulemaking, the Department

addressed the comments responding to

the proposed deletion of paragraph (c).

64 FR 54974 (Oct. 8, 1999). Some

comments urged the Department to

promulgate a version of the ‘‘true

doubt’’ rule which would comply with

Greenwich Collieries. Other comments

suggested retaining paragraph (c) as a

statement of general principle and a

reminder to adjudicators of the purpose

of the Black Lung Benefits Act (BLBA).

The Department rejected both

suggestions. The Department concluded

a ‘‘true doubt’’ evidentiary rule would

not improve claims adjudication.

Rather, the factfinder must conduct an

in-depth analysis of the medical

evidence in each case, and resolve

credibility issues. The Department also

noted that evidence is rarely in

equipoise because a factfinder must

consider such a wide variety of factors

in weighing it: Physicians’

qualifications, clinical documentation,

79926 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

reasoning, relationship to other medical

evidence, etc. With respect to paragraph

(c) as a statement of principle, the

Department considered the provision

unnecessary because it would be

unenforceable, and because the

principles appear in the legislative

history of the BLBA which may be cited

by a party in litigation. Moreover, the

Department noted it had addressed the

difficulties confronted by claimants in

proving their claims in other

regulations, e.g., by requiring substantial

compliance rather than strict

compliance with the quality standards

for medical evidence. (iii) The

Department has received four additional

comments concerning the ‘‘true doubt’’

rule.

(b) Two comments observe that the

Department has the regulatory authority

to promulgate a ‘‘true doubt’’ rule which

will comply with Greenwich Collieries,

and three comments urge the need for

such a rule to implement Congressional

intent that all reasonable doubt be

resolved in the claimant’s favor. The

Department recognizes that it has the

statutory authority to depart from the

requirements of the APA and allocate

burdens of production and persuasion

among the parties. The Department,

however, does not believe codification

of the ‘‘true doubt’’ rule is necessary to

afford claimants the protections

Congress intended in directing

resolution of reasonable doubts in their

favor. Rather than a statement of general

principle, the Department has provided

assistance to claimants in other ways.

As noted in the second notice of

proposed rulemaking, the Department

eased the level of compliance with the

quality standards for clinical tests and

medical reports from strict adherence to

‘‘substantial compliance.’’ 64 FR 54974

(Oct. 8, 1999). The reduced standard

allows the adjudicator more leeway to

determine in each particular case

whether any defects in compliance

undermine the credibility of the test or

report. Another example is the ‘‘treating

physician’’ rule in § 718.104(d). The

regulation enhances the weight an

adjudicator may give to a miner’s

treating physician’s opinion provided

the opinion meets certain standards. In

addition, § 725.406(d) provides each

claimant with the opportunity to have

his or her treating physician receive

objective test results (such as a chest xray reading and pulmonary function

study results), in substantial compliance

with the regulations’ quality standards.

This provision ensures that the

claimant’s treating physician’s opinion

may be based on complying evidence.

Finally, the Department has adopted

burden-shifting presumptions such as

the default onset date for the

commencement of benefits,

§ 725.503(b), (d), and the presumption

of coverage for pulmonary-related

medical benefits, § 725.701(e), which

assist claimants on medical treatment

issues. These provisions significantly

reduce the need for a ‘‘true doubt’’ rule.

(c) Three comments contend a ‘‘true

doubt’’ rule is necessary because the

limitations on the quantity of medical

evidence imposed by the regulations

will result in increased instances in

which the evidence for and against

entitlement is in equipoise despite

scrupulous consideration of all relevant

factors affecting credibility. The

Department disagrees. The adjudicator

must examine several variables in

weighing the credibility of each item of

medical evidence, especially

physicians’ opinions. Age of the

opinion, reasoning, underlying clinical

data, the physician’s level of expertise,

reliability of employment, social and

medical histories, etc., are all factors to

be considered in each report. As for

clinical studies, the quality standards

establish criteria to measure the

reliability of the clinical results, and

physicians’ reviews of the results

provide additional information on the

studies’ validity. When all available

information is assembled, the

Department believes few medical

records for and against entitlement will

be in equipoise. Furthermore, the

limitations on evidence should prompt

each party to bolster the credibility of its

medical evidence and challenge the

credibility of its opponent’s case.

(d) One comment states the ‘‘true

doubt’’ rule is especially needed for

weighing chest x-rays because that type

of evidence involves very few variables

(film quality, readers’ expertise) which

can affect the credibility of the

evidence. The Department believes no

need exists to adopt a specialized ‘‘true

doubt’’ rule for use in weighing only xrays. Such a rule would place undue

importance on one type of evidence,

and would overemphasize the role of xrays in determining whether the miner

has pneumoconiosis. Chest x-rays are

used to determine whether the miner

has ‘‘clinical’’ pneumoconiosis, i.e.,

‘‘the lung disease caused by fibrotic

reaction of the lung tissue to inhaled

dust, which is generally visible on chest

x-rays as opacities.’’ Hobbs v.

Clinchfield Coal Co., 917 F.2d 790, 791

n. 1 (4th Cir. 1990) (citation omitted).

The BLBA explicitly prohibits the

denial of a claim based solely on

negative x-rays. 30 U.S.C. 923(b). The

reason for this prohibition is Congress’

reservations about the reliability of

negative x-rays as trustworthy evidence

that the miner does not have

pneumoconiosis. Usery v. Turner

Elkhorn Mining Co., 428 U.S. 1, 31–34

(1976). Consequently, Congress has

limited the use of negative x-rays in

evaluating a miner’s entitlement to

benefits. Even if the x-ray readings in a

particular claim appear to be truly

balanced and therefore insufficient to

meet the preponderance standard,

however, the claimant may nevertheless

establish the existence of clinical

pneumoconiosis. For example, a

factfinder might find one x-ray reading

more credible than another based on a

radiologist’s explanation, contained in a

supplemental report or deposition

testimony, of the reasons for his x-ray

diagnosis. Such reasons may include

consideration of the miner’s complete

occupational history, including the

length of his or her coal mine

employment, and the absence of other

injurious exposures, see 45 FR 13687,

Discussion and changes, § 718.202 (Feb.

29, 1980). In addition, a claimant may

prove the existence of ‘‘legal’’

pneumoconiosis. This broader category

of compensable disease comprises ‘‘all

lung diseases which * * * [are]

significantly related to, or substantially

aggravated by, dust exposure in coal

mine employment.’’ Hobbs, 917 F.2d 4

791 n. 1; see also Barber v. Director,

OWCP, 43 F.3d 899, 901 (4th Cir. 1995).

In weighing medical evidence relevant

to ‘‘legal’’ pneumoconiosis, the

adjudicator may consider a variety of

factors which affect the weight of the

medical evidence, e.g., the physicians’

expertise, the reasoning and

documentation in the medical reports,

the comparative consistency or

inconsistency of the opinions with other

medical evidence such as hospital

reports, etc. A claimant has ample

opportunity to establish that (s)he has a

lung disease caused by coal mine

employment in addition to the narrow

type of disease discoverable by x-rays.

The Department therefore rejects the

position that a ‘‘true doubt’’ rule should

be available for the purpose of resolving

conflicts in x-ray evidence.

(e) One comment suggests a ‘‘true

doubt’’ rule would be useful in

resolving conflicts between qualifying

and nonqualifying pulmonary function

and blood gas studies. The commenter

acknowledges that more factors exist to

determine the credibility of these types

of clinical evidence than exist when

chest x-ray evidence is in conflict, but

nevertheless recommends making the

rule applicable in the event the

evidence is in equipoise. Both

pulmonary function (§ 718.103) and

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79927

blood gas studies (§ 718.105) must

comply with far more detailed quality

standards than x-rays. Although only

‘‘substantial compliance’’ is required

under the regulations, the more detailed

standards necessarily provide more

points of comparison between studies

and more bases for preferring one study

to another. A party may challenge

another party’s study by submitting

expert opinion evidence demonstrating

the study is unreliable or invalid. Given

the numerous means of challenging or

bolstering a study, the Department does

not believe a ‘‘true doubt’’ rule would

play a significant role in weighing

pulmonary function studies and blood

gas studies. No change in the regulation

is appropriate.

(f) No other comments have been

received concerning this section, and no

changes have been made in it.

Subpart B

20 CFR 718.101

(a) In the initial notice of proposed

rulemaking, the Department added

subsection (b) to emphasize that the part

718 quality standards apply to all

evidence developed by any party in

connection with a claim filed after

March 31, 1980, and to claims governed

by part 727 if the evidence was

developed after that date. 62 FR 3341

(Jan. 22, 1997). Paragraph (b) also

established a single standard of

compliance for all clinical tests and

medical reports, in place of the varying

standards contained in the former

individual regulations. The Department

revised paragraph (b) in the second

notice of proposed rulemaking to clarify

that the quality standards will apply

only prospectively to evidence

developed in connection with a claim,

after promulgation of these regulations.

The Department noted it wished to

avoid invalidating evidence already

submitted in pending claims based on

the parties’ settled expectations. 64 FR

54974–75 (Oct. 8, 1999). The

Department also responded to numerous

comments received after the initial

notice of proposed rulemaking. It

rejected comments opposing the general

applicability of the quality standards to

medical evidence and advocating

consideration of noncomplying

evidence, citing the need for technically

accurate and reliable evidence for the

adjudication of entitlement issues. For

the same reason, the Department

rejected comments disputing its

authority to impose quality standards on

medical evidence as inconsistent with

the Black Lung Benefits Act’s (BLBA)

requirement that ‘‘all relevant evidence’’

be considered. See 30 U.S.C. 923(b). The

Department concluded quality

standards are consistent with the

mandated consideration of all relevant

evidence because noncomplying

evidence is inherently unreliable, and

therefore not relevant to the

adjudication of a claim. The Department

rejected the suggestion that the criteria

enumerated in the quality standards

should provide the only grounds for

invalidating medical evidence; rather,

parties may develop any evidence

which addresses the validity of the

evidence. The Department explained

there was no need to add an exemption

from the quality standards for

hospitalization and treatment records

because § 718.101 is clear that it applies

quality standards only to evidence

developed ‘‘in connection with a claim’’

for black lung benefits. Finally, the

Department rejected as unnecessary a

requirement that the Department notify

a party if its evidence is noncomplying

and allow it to rehabilitate the evidence

because the responsibility for

submitting complying evidence rests

with the party submitting it. The district

director is already responsible for

ensuring the complete pulmonary

examination required by 30 U.S.C.

923(b) complies with all applicable

quality standards. In addition, if an

opposing party challenges evidence as

noncomplying, the party originally

submitting it may rehabilitate the

evidence by submitting an additional

report from the author of the original

report.

(b) Two comments reiterate the

general argument that 30 U.S.C. 923(b)

and the Administrative Procedure Act

(APA), 5 U.S.C. 556(d), require

consideration of ‘‘all relevant evidence,’’

and the Department therefore cannot

exclude from the adjudicator’s

consideration noncomplying medical

evidence. The Department previously

addressed, and rejected, this argument

in the second notice of proposed

rulemaking. 64 FR 54974 (Oct. 8, 1999).

The Department stated that

noncomplying evidence is not ‘‘relevant

evidence’’ because it is inherently

unreliable, and cannot form the basis for

awarding or denying a claim. Upon

further consideration, the Department

concludes this statement, while accurate

in the majority of cases, should be

qualified. Evidence which does not

substantially comply with the

applicable standard generally is not very

reliable. Noncomplying evidence should

only form the basis for awarding or

denying a claim in limited

circumstances. All three of the

following requirements must be met: no

evidence exists which does comply with

the applicable standards; the defect(s)

cannot be cured by a supplementary

opinion or other evidence; and the

death of the miner precludes developing

evidence which would be in substantial

compliance. In order for such evidence

to support an award or denial, the

adjudicator must find the evidence

sufficiently reliable to establish the

fact(s) for which it is offered despite its

failure to meet the threshold

‘‘substantial compliance’’ standard. The

Department therefore rejects the

commenters’ general position that

noncomplying evidence cannot be

excluded under 30 U.S.C. 923(b),

although the Department recognizes a

limited exception to the standards’

gatekeeping function for some claims

involving deceased miners.

(c) Two comments cite specific

examples of circumstances in which

allegedly probative physicians’ opinions

could be disregarded on compliance

grounds. (i) In one example, the

commenter cites as potentially

noncomplying a medical opinion

diagnosing ‘‘legal’’ pneumoconiosis

based on valid pulmonary function and

arterial blood gas testing, but omitting

any chest x-ray testing. The Department

has previously considered the position

that a medical report should not

automatically be found noncomplying

based on the absence of an x-ray. 64 FR

54977 (Oct. 8, 1999). In rejecting the

comment that the quality standard

applicable to reports of physical

examination (§ 718.104) should not

make a chest x-ray a standard

requirement, the Department noted that

an x-ray is an integral part of any

examination for pneumoconiosis. The

Department further noted, however, that

medical evidence must only be in

‘‘substantial compliance’’ with the

applicable quality standards; the party

proffering the evidence may

demonstrate that the evidence is reliable

despite its failure to comply with every

criterion in the standard. The

Department reiterates that position.

Whether any particular piece of

evidence is in ‘‘substantial compliance’’

with the standards, and therefore

reliable, is a matter for the adjudicator

to determine taking into consideration

all relevant circumstances. One

important factor is the element(s) of

entitlement for which the evidence is

offered. In the example cited above, the

lack of an x-ray is not necessarily fatal.

The report may contain: valid and

pertinent other tests and information

upon which the physician can make a

diagnosis; accurate medical, smoking

and employment histories; results of a

physical examination confirming the

79928 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

presence of pulmonary symptoms or

impairment; and pulmonary function

study and/or blood gas studies

demonstrating impairment. Based on

this documentation, the physician may

provide a documented and reasoned

diagnosis of ‘‘legal pneumoconiosis’’

which the adjudicator considers

reliable, i.e., in ‘‘substantial

compliance’’ with the quality standards.

See 45 FR 13687 (Feb. 29, 1980),

§ 718.202, Discussion and changes (h).

(ii) In another example, the commenter

posits a ‘‘positive’’ medical opinion

based on an invalid pulmonary function

test, valid arterial blood gas testing,

physical examination and other data.

The lack of a valid pulmonary function

study is not necessarily a reason to

reject the entire report. The hypothetical

assumes a valid blood gas test, physical

examination, etc. As in the first

example, this testing and information

may support a documented and

reasoned diagnosis depending on the

purpose for which the report is offered.

If the physical examination and clinical

tests other than the pulmonary function

study substantiate the presence of a

pulmonary/respiratory impairment, the

factfinder may deem the physician’s

diagnosis a reliable assessment of the

miner’s extent of impairment. If the

employment, smoking and other

personal information is accurate, the

adjudicator may accept the physician’s

conclusions about the cause of the

miner’s pulmonary or respiratory

impairment. If, however, the physician

clearly relied on the invalid pulmonary

function study (or other inaccurate data

or information), the adjudicator may

find the opinion unreliable in one or

more respects. (iii) The Department

emphasizes that the ‘‘substantial

compliance’’ standard is a rule of

reason. In each case in which an issue

of noncompliance is raised, the

factfinder must identify any failure to

comply strictly with the applicable

quality standard. The factfinder must

then determine whether the test or

report is reliable despite its failure to

comply with every criterion in the

standard. This finding is necessarily

dependent to an extent on the

element(s) of entitlement for which the

test or report may be relevant. The

significance of the particular defect

must therefore be ascertained by

considering whether it is critical to the

physician’s conclusions. In the first

example, the lack of an x-ray may be

excused if the physician has offered a

documented and reasoned diagnosis of

‘‘legal’’ pneumoconiosis. In the second

example, the invalid pulmonary

function study may or may not affect an

otherwise documented and reasoned

evaluation of the miner’s respiratory/

pulmonary condition. No categorical

response, however, can be given to the

hypotheticals since the reliability, and

therefore the probative value, of the

reports can only be evaluated in the

context of an actual claim. No change in

the regulation is warranted.

(d) One comment urges the

Department to include a provision

specifically exempting those medical

tests and reports generated outside the

black lung benefits claim context from

the quality standards. Specifically, the

commenter requests that the text of the

regulation make clear that chest x-rays,

pulmonary function tests and blood gas

studies administered in the hospital or

as part of the miner’s routine care be

exempted from quality standards

applicability. The Department

previously addressed this concern in the

second notice of proposed rulemaking.

64 FR 54975 (Oct. 8, 1999). The

Department noted that § 718.101 limits

the applicability of the quality standards

to evidence ‘‘developed * * * in

connection with a claim for benefits’’

governed by 20 CFR parts 718, 725 or

727. Despite the inapplicability of the

quality standards to certain categories of

evidence, the adjudicator still must be

persuaded that the evidence is reliable

in order for it to form the basis for a

finding of fact on an entitlement issue.

Additional exclusionary language in the

regulation is therefore unnecessary.

(e) One comment contends all

medical evidence involving a deceased

miner should be considered without

regard to the quality standards because

the miner is no longer available for

further testing. The Department

disagrees. The regulations provide that

a deceased miner’s noncomplying chest

x-rays, pulmonary function studies and

medical reports may form the basis of an

award or denial of benefits under

certain circumstances provided no

complying study or report is available.

See §§ 718.102(e) (x-rays), 718.103(c)

(pulmonary function studies),

718.104(c) (medical reports). The

Department has added a similar

provision to § 718.105 (arterial blood gas

studies). With respect to each category

of evidence, the availability of tests or

reports in substantial compliance with

the applicable quality standards makes

reliance on the noncomplying tests or

reports unnecessary; the record already

contains reliable evidence addressing

the deceased miner’s pulmonary

condition, and reliable evidence is the

fundamental purpose of the quality

standards. Furthermore, excusing

noncompliance for all evidence

involving a deceased miner ignores the

fact that existing evidence may be

brought into substantial compliance

despite the unavailability of the miner.

The party offering the evidence may

obtain a supplementary opinion from

the physician who conducted the

noncomplying test or authored the

report, and cure the defect(s). Finally,

the party may submit the noncomplying

evidence in any event, ecognizing that

it may be considered but cannot

establish any fact for which complying

evidence is in the record.

(f) One comment suggests that

applying the quality standards only

prospectively will sanction the

acceptance of inferior evidence if the

evidence was developed before the

effective date of these regulations. The

commenter also contends the

Department’s rationale for prospective

application implies the former quality

standards will not apply to evidence

developed before the effective date of

these regulations, especially for

unrepresented claimants. The

Department disagrees. In the initial

notice of proposed rulemaking,

proposed § 718.101(b) required all

evidence developed in conjunction with

a black lung benefits claim to comply

with the applicable quality standards.

62 FR 3374 (Jan. 22, 1997). The

Department stated that the purpose of

§ 718.101(b) was to make clear the

Department’s disagreement with

Benefits Review Board precedent

holding the former 20 CFR part 718

quality standards applied only to

evidence developed by the Director. 62

FR 3341 (January 22, 1997). One

comment, in response to the first

proposal, noted that, as written,

§ 718.101(b) would invalidate evidence

in claims pending before the

Department which was valid under

prevailing Board precedent at the time

the evidence was generated. The

Department responded to this concern

in the second notice of proposed

rulemaking by revising § 718.101 to

apply the quality standards only to

evidence developed after the effective

date of the regulations. 64 FR 55010

(Oct. 8, 1999). In explaining the

revision, the Department acknowledged

the ‘‘substantial hardship’’ which might

occur, especially for unrepresented

claimants, if medical evidence which

complied with the law when submitted

into evidence became invalid after the

regulations become effective. This

explanation, however, is not a

concession as to the correctness of the

Board’s decisions. Since 1980, the

Department has consistently taken the

position that the 20 CFR part 718

quality standards apply to all evidence

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79929

developed by any party in black lung

benefits claim litigation. Although the

Board has rejected the Department’s

position, Gorzalka v. Big Horn Coal Co.,

16 Black Lung Rep. 1–48, 1–51 (1990)

(and cases collected), the only court of

appeals to consider the issue has agreed

with the Department. Director, OWCP v.

Mangifest, 826 F.2d 1318 (3d Cir. 1987).

The Department adheres to this view

with respect to any evidence developed

in conjunction with a claim by any

party before the effective date of the

proposed regulations.

(g) Two comments approve of the

prospective application of the quality

standards. One comment approves of

the ‘‘substantial compliance’’ standard.

(h) No other comments have been

received concerning this section, and no

changes have been made in it.

20 CFR 718.102

(a) In the initial notice of proposed

rulemaking, the Department proposed

three minor changes to § 718.102:

eliminating the reference to the

compliance standard in light of the

substantial compliance language of

general applicability in § 718.101(b);

adding language presuming compliance

with the technical criteria for chest xrays in Appendix A; and correcting a

typographical error in subsection (e)

which cited to a nonexistent regulation.

62 FR 3342 (Jan. 22, 1997). The

Department did not propose any

additional changes in the second notice

of proposed rulemaking. 64 FR 54971

(Oct. 8, 1999). In the final rule, the

Department has changed subsection (e)

to clarify the probative value of

noncomplying x-rays in the case of a

deceased miner. Specifically, this

provision states that an x-ray, which is

not in substantial compliance with the

quality standard, may still establish the

presence or absence of pneumoconiosis

if the x-ray is of sufficient quality for a

board-eligible radiologist, boardcertified radiologist, or ‘‘B’’ reader to

interpret the film. The Department has

also added a sentence to subsection (b)

to inform interested parties where they

may obtain a copy of the ILO

classification.

(b) One comment argues that

§ 718.102(b) should state that an x-ray

cannot establish the absence of

pneumoconiosis unless it complies with

the quality standards and is classified

according to a recognized scheme. The

commenter further argues that

§ 718.102(b) and (e), in conjunction with

§ 718.101(b), are insufficient to impose

this requirement. Section 718.102(b)

identifies the classification systems

which are acceptable for black lung

claims. Subsection (e) states that no xray may demonstrate either the presence

or absence of pneumoconiosis unless it

complies with reporting requirements,

i.e., paragraph (b). Section 718.101(b)

reinforces this requirement by stating

that ‘‘any evidence’’ which is not in

substantial compliance with the

applicable quality standard cannot

‘‘establish the fact for which it is

proffered.’’ For purposes of the quality

standards, ‘‘substantial compliance’’

may mean less than strict compliance

with each and every requirement of the

applicable quality standard if the

evidence is nevertheless deemed

reliable by the factfinder. The

adjudicator must determine whether the

x-ray reading is, or is not, in substantial

compliance if one or more items of

required information have been omitted,

including classification of x-ray findings

according to any of the reporting

schemes in § 718.102(b). In some

circumstances, the adjudicator may

determine that the x-ray interpretation

provides sufficient information to make

a factual finding on the presence or

absence of pneumoconiosis. For

example, the physician may describe

the film findings in terms of ‘‘no

pneumoconiosis,’’ rather than

classifying the film as ‘‘0/-, 0/0 or 0/1.’’

Such a reading may be considered

sufficiently detailed to be in

‘‘substantial compliance’’

notwithstanding the lack of

classification. Conversely, the

physician’s description or reporting of

x-ray film findings may indicate (s)he

read the film for reasons unrelated to

diagnosing the existence of

pneumoconiosis, e.g., lung cancer or

cardiac surgery. The adjudicator may

consider that evidence not in substantial

compliance because it does not reliably

address the presence or absence of

pneumoconiosis. Accordingly, the

Department disagrees with the

commenter’s position that any

unclassified x-ray is not in ‘‘substantial

compliance’’ with § 718.102.

(c) Four comments suggest adding the

phrase ‘‘in and of itself’’ to the

subsection (e) prohibition on using

unclassified x-rays to demonstrate the

presence or absence of pneumoconiosis.

The comments contend that the change

would make clear that x-ray evidence of

some disease process, in conjunction

with other evidence, could be used to

prove the miner has a lung disease

caused by coal dust exposure, i.e.,

‘‘legal’’ pneumoconiosis. The

recommended change is unnecessary.

An unclassified x-ray which yields

positive indications of lung disease

cannot establish the presence of

pneumoconiosis under § 718.202(a)(1),

which is intended as a means of proving

only the existence of clinical

pneumoconiosis. An x-ray report,

however, may also be part of a medical

report which must be considered under

§ 718.202(a)(4). Even an unclassified xray may therefore provide some clinical

basis for a diagnosis of a respiratory

disease arising out of coal mine

employment under that section.

Consequently, provision is already

made for consideration of the results of

an unclassified x-ray in the context of a

medical report. In this context, it may be

used to support a diagnosis of legal

pneumoconiosis.

(d) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.103

(a)(i) The Department proposed

amending § 718.103 in the initial notice

of proposed rulemaking to take into

account proposed § 718.101(b), which

would establish a single standard of

‘‘substantial compliance’’ for all of the

quality standards. 62 FR 3342 (Jan. 22,

1997). The Department also proposed

changes to § 718.103(c) to harmonize it

with § 718.102(e) (X-rays). Both

provisions operate in the same manner

and for the same purposes: to presume

compliance with technical requirements

in the applicable appendices to part

718; to permit rebuttal of the presumed

compliance with relevant evidence; and

to permit exceptions to the quality

standards for a deceased miner if the

claim presents limited evidence. (ii) In

response to comments received

concerning the initial notice of

proposed rulemaking, the Department

recommended several additional

changes to § 718.103 in the second

notice of proposed rulemaking. 64 FR

54975–76 (Oct. 8, 1999). One physician

testified at the Washington, D.C.,

hearing that a flow-volume loop

provided a more acceptable basis for

obtaining verifiable test results than the

proposed prohibition on an initial

inspiration from room air. The

Department agreed, and proposed

changing both § 718.103 and Appendix

B to require flow-volume loops for every

pulmonary function test obtained after

the effective date of the final regulation.

The Department invited additional

comment on this proposal. The

Department also announced its

intention to survey clinics and facilities

which specialize in the treatment of

pulmonary conditions to ascertain the

extent to which they already used

spirometers capable of producing flowvolume loops. The same physician

observed that 20 CFR 718.103(a) (1999)

required that pulmonary function

79930 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

testing produce either a Forced Vital

Capacity (FVC) or a Maximum

Voluntary Ventilation (MVV) result, yet

also required a one-second Forced

Expiratory Volume (FEV1) which must

be derived from the FVC. The

Department agreed the regulation was

inconsistent, and proposed a revision to

§ 718.103(a) making the FVC a required

result along with the FEV1 and the MVV

optional. The Department also proposed

increasing the allowable difference

between the two largest MVV values

from 5 percent to 10 percent in

§ 718.103(b) to harmonize the regulation

with Appendix B. The former and

initially proposed § 718.103(b) required

submission of three tracings of the MVV

maneuver unless the two largest MVV

results were within 5 percent of each

other, in which case only two tracings

were necessary. By contrast, Appendix

B has consistently stated that the

variation between the two largest MVV

shall not exceed 10 percent. The

Department chose the more liberal

variation. The Department agreed that

the validity of the MVV and FEVl/FVC

values must be assessed independently,

and that the MVV maneuver is optional

for compliance purposes. The

Department, however, rejected the

suggestion to remove certain technical

requirements from the quality standards

to avoid invalidating a pulmonary

function test for less than strict

compliance; the Department responded

that the ‘‘substantial compliance’’

standard would allow a party to

establish the credibility of the study,

notwithstanding the absence of one or

more of the § 718.103 requirements.

Finally, the Department proposed

revisions to §§ 718.104(a)(6) and

718.204(b)(2)(iv) to recognize that a

medical report cannot be rejected for

lack of a pulmonary function study if

the performance of the test was

medically contraindicated. (iii) For the

final rule, the Department has changed

the word ‘‘submitted’’ in § 718.103(b) to

‘‘developed’’ to conform the regulation

to similar usage in § 718.101(b). The

Department also changed the opening

phrase of the first sentence in

§ 718.103(c) to clarify that paragraph (c)

is an exception to the remainder of

§ 718.103. Finally, the Department

amended the final sentence in

subsection (c) to make clear that a

noncomplying pulmonary function test

involving a deceased miner may be used

to establish the presence or absence of

a respiratory or pulmonary impairment

under limited circumstances. If no

complying test is in the record and, in

the adjudicator’s opinion, the

noncomplying test yielded technically

valid results and the miner provided

good cooperation, the party submitting

the noncomplying test may rely on it.

(b) The Department announced its

intention in the second notice of

proposed rulemaking to conduct a

survey of the physicians, clinics and

facilities which perform pulmonary

function testing (spirometry testing) to

evaluate the prevalence of spirometers

capable of producing a flow-volume

loop. The Department considered the

survey necessary in light of its

conclusion that the flow-volume loop

may provide a ‘‘more reliable method of

ensuring valid, verifiable results in

pulmonary function testing.’’ 64 FR

54975 (Oct. 8, 1999). The Department

also cited the relatively inexpensive cost

(approximately $2000) for a spirometer

capable of producing the flow-volume

loop. The Department sent out the

survey, dated March 7, 2000, to

approximately 1800 pulmonary clinics,

facilities and physicians board-certified

in internal medicine with a subspecialty

in pulmonary disease (Rulemaking

Record Ex. 107), and received 225

responses (Rulemaking Record Ex. 109).

Of those responses, only nine indicated

they did not perform pulmonary

function testing on equipment

producing a flow-volume loop. Of those

nine, five indicated they would consider

obtaining the necessary equipment. An

additional 19 surveys did not respond to

the questions concerning spirometric

testing. The remaining respondents, 197

in all, unanimously used the flowvolume loop. Based on these survey

results, the Department concludes the

benefit to the claims adjudication

process in obtaining reliable pulmonary

function data warrants revising

§ 718.103(a) and Appendix B to make

the flow-volume loop a mandatory

requirement for any pulmonary function

test conducted after the effective date of

these regulations in connection with a

claim for benefits under the Black Lung

Benefits Act (BLBA).

(c) One comment opposes the flowvolume loop requirement because

spirometric equipment which records

this data may not be universally

available. The Department disagrees. In

the second notice of proposed

rulemaking, the Department proposed

using the flow-volume loop because it

provides a reliable and relatively

inexpensive means of producing valid,

verifiable pulmonary function test

results. 64 FR 54975 (Oct. 8, 1999). The

Department’s survey of physicians,

clinics and facilities which perform

pulmonary function testing confirmed

the widespread use of spirometers

capable of producing flow-volume

loops. Although some clinics and

individual physicians may not utilize

such machines, the Department has

concluded that the overall benefit to the

claims adjudication process warrants

required use of this technology. In any

event, the claimant should always have

access to one set of testing which

complies with the quality standards,

including the flow-volume loop

requirement, as a result of the

pulmonary examination authorized by

30 U.S.C. 923(b). This provision of the

BLBA requires the Black Lung Disability

Trust Fund to afford each minerclaimant the opportunity to substantiate

his or her claim by means of a complete

pulmonary examination at no expense

to the claimant. See also § 725.406(a).

Under § 725.406(c), the district director

is responsible for ensuring that the

examination authorized by 30 U.S.C.

923(b) is in ‘‘substantial compliance’’

with the requirements of part 718,

including the quality standards. Section

725.406(d) requires the Department to

make available to the claimant’s

physician, on the claimant’s request, the

clinical test results obtained in

conjunction with the pulmonary

examination. Thus, contrary to the

commenter’s concern, the claimant’s

physician should routinely be able to

consider substantially complying

clinical testing of the miner in

formulating an opinion, despite the lack

of capable technology in his or her own

practice.

(d) One comment approves of the

§ 718.103 revisions generally, and

particularly approves of the language

making clear that the Maximum

Voluntary Ventilation maneuver is

optional. One comment supports the use

of flow-volume loops and changes to

§ 718.103(a) which eliminate internal

inconsistencies and clarify that the

Maximum Voluntary Ventilation

maneuver is optional. One comment

approves of requiring pulmonary

function test results using flow-volume

loops and the increase from 5 percent to

10 percent in the maximum variation

between the two largest MVV values.

(e) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.104

(a)(i) The Department proposed

several changes to § 718.104 in the

initial notice of proposed rulemaking.

62 FR 3342–43, 3375 (Jan. 22, 1997).

One change required that each medical

opinion developed in connection with a

claim be based on specified tests and

information, including a chest x-ray and

pulmonary function study which

comply with the applicable quality

standards. Another change proposed

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79931

guidelines for the adjudicator to

determine whether to afford special

weight to an opinion from the miner’s

treating physician. The Department

considered codification of the treating

physician’s special status appropriate,

given its longstanding judicial

recognition in the caselaw. In order to

ensure a critical analysis of the

physician-patient relationship, the

guidelines described four basic factors

the adjudicator must consider: whether

the physician provided pulmonary or

non-pulmonary treatment; how long the

physician treated the miner; how often

the physician treated the miner; and

what types of tests and examinations the

physician conducted. Finally, the

Department emphasized that the

adjudicator must consider not only the

quality of the physician’s relationship

with the miner, but also the reasoning

and documentation in the opinion itself,

and in the context of the remainder of

the record, before crediting that opinion.

(ii) In the second notice of proposed

rulemaking, the Department responded

to the extensive comments which the

proposed regulation had elicited. 64 FR

54976–77 (Oct. 8, 1999). The

Department revised the regulation to

excuse mandatory pulmonary function

testing if it was medically

contraindicated and the physician

conducted other types of medically

accepted diagnostic tests; to make

explicit that a treating physician’s

opinion could be used to establish all

elements of a miner’s entitlement; and

to accept the physician’s statement as to

subsection (d)’s treating relationship

criteria, absent contrary evidence from

another party. The Department rejected

comments which advocated the

automatic acceptance of a treating

physician’s opinion if it satisfied the

criteria of subsections (d)(1) through (5)

and was documented and reasoned,

regardless of the remaining medical

evidence. The Department also rejected

one comment which contended the

regulation already mandated the

automatic acceptance of a treating

physician’s opinion in violation of 30

U.S.C. 923(b) (requiring consideration of

all relevant evidence). In response, the

Department emphasized that

§ 718.104(d) only required the

adjudicator to consider the possible

enhanced value of a treating physician’s

opinion, and did not require a

mechanistic acceptance of that opinion.

The Department responded in similar

fashion to several comments which

contended that all medical opinions,

including a treating physician’s opinion,

should be evaluated only on the

strength of their documentation and

reasoning and each physician’s

professional qualifications. With respect

to a comment recommending placement

of the treating physician rule in a

separate regulation, the Department

concluded no change was warranted;

subsection (d)’s position in the quality

standards governing reports of

physician examinations underscored

that a treating physician’s opinion was

required to satisfy the same quality

standards as any other physician

examination report developed in

connection with a claim for benefits.

The Department acknowledged some

commenters’ concern that

unrepresented claimants would likely

submit noncomplying reports from their

treating physicians. The Department,

however, rejected the suggestion that

treating physicians’ opinions should be

exempted from the evidentiary

limitations for that reason. Instead, the

Department noted its own obligation to

inform claimants in an understandable

manner about the evidentiary

limitations, and to provide any

claimant’s treating physician with the

results of the § 725.406 objective testing

upon the claimant’s request. The

Department denied one comment’s

suggestion that language in the initial

notice of proposed rulemaking (see 62

FR 3339 (Jan. 22, 1997)) made an

adjudicator’s failure to consider a

physician’s training and specialization

reversible error. In the Department’s

view, a physician’s qualifications were

an issue only when raised by a party.

The Department also rejected the

suggestion that a chest x-ray,

administered and read in accordance

with § 718.102, not be mandatory

documentation for a complying report of

physical examination. The Department

cited the importance of such a

diagnostic test and the flexibility of the

‘‘substantial compliance’’ standard in

excusing noncompliance depending on

the particular circumstances of the case.

In response to two comments, the

Department declined to remove a

limitation on the use of noncomplying

medical opinions. The regulation

therefore allowed consideration of

reports of physical examination not in

substantial compliance with § 718.104

only if the miner was deceased, the

physician was unavailable to cure the

defects in the report, and there was no

complying report in the record. In

explanation, the Department

emphasized that entitlement decisions

must be based on the best available

evidence. Finally, the Department

invited additional public comment on

alternative means of determining when

a treating physician’s opinion should

receive ‘‘controlling weight,’’ including

whether the Department should adopt

the Social Security Administration’s

rule. (iii) For purposes of the final rule,

the Department has altered subsection

(c) to conform this provision to the

general ‘‘substantial compliance’’

standard in § 718.101(b). As amended,

§ 718.104(c) makes clear that a

noncomplying report of physical

examination may nevertheless provide

evidence for a factual finding in certain

limited circumstances involving a

deceased miner and the lack of any

complying report of physical

examination in the record. The report

must have been prepared by a physician

who is ‘‘unavailable,’’ e.g., deceased,

whose whereabouts are unknown, etc.

The report must also be found to

possess sufficient indicia of reliability

that the adjudicator may reasonably rely

on it for factual findings.

(b) Several comments oppose granting

special weight to the opinion of a

miner’s treating physician, contending

the rule either intrudes on the

adjudicator’s role in evaluating evidence

or compels the acceptance of an opinion

from the treating physician regardless of

contrary opinions from physicians with

greater expertise in pulmonary

medicine. The Department responded to

a similar criticism in the second notice

of proposed rulemaking. 64 FR 54976

(Oct. 8, 1999). In rejecting a

commenter’s view that § 718.104(d)

effectively precluded consideration of

all relevant evidence in favor of the

opinion of the miner’s treating

physician, the Department emphasized

the real purpose of the rule: to recognize

that a physician’s professional

relationship with the miner may

enhance his or her insight into the

miner’s pulmonary condition. The

Department does not believe that, as

proposed, section 718.104(d) contained

an outcome-determinative evidentiary

rule. See 64 FR 54977 (Oct. 8, 1999).

The Department has revised the

language of section 718.104(d),

however, in light of several commenters’

continued confusion as to the role of

§ 718.104(d) in weighing reports of

physical examinations. The Department

hopes to clarify its original intent with

this revision. Like the previously

proposed version, subsection (d)

acknowledges the special weight which

the opinion of a miner’s treating

physician may receive from the

adjudicator. Section 718.104(d)(1)–(4)

provide criteria for evaluating the

quality of that doctor-patient

relationship as indicia of the potential

insight the physician may have gained

from on-going treatment of the miner.

79932 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Instead of compelling the automatic

acceptance of the treating physician’s

opinion, section 718.104(d) is designed

to force a careful and thorough

assessment of the treatment

relationship. The adjudicator may

conclude that no additional weight is

due the physician’s opinion because one

or more of the criteria establish facts

which make such weight inappropriate.

For example, the physician may have

provided only a short-term course of

treatment, or have actually examined

the miner only infrequently. The

adjudicator should consider giving

additional weight to the treating

physician’s opinion only when review

of the regulatory criteria establishes the

physician’s thorough understanding of

the miner’s pulmonary condition.

Subsection (d)(5) describes the next step

in the adjudicator’s inquiry: the

adjudicator must consider whether the

treating physician’s opinion is

supported by sufficient documentation

and reasoning, and must weigh it with

all other reasoned and documented

medical opinions in the record. In

addition, the fact finder must consider

all other relevant evidence of record.

The regulation provides that only after

the adjudicator finishes this weighing

may he, in appropriate cases, base his

decision to give ‘‘controlling weight’’ to

the opinion of the miner’s treating

physician on that physician’s superior

understanding of the miner’s pulmonary

condition. The Department recognizes

that each case will present different

issues regarding both the extent to

which the treating physician meets the

four criteria in subsection (d)(1)–(4), the

documentation and reasoning of that

physician’s opinion, and the relative

merits of the other relevant medical

evidence of record. As a result, the

regulation does not attempt to dictate

the outcome of any particular case. The

Department therefore rejects the

position that § 718.104(d) intrudes on

the fact-finding responsibilities of the

adjudicator.

(c) One comment opposes requiring

each physician’s opinion to include an

x-ray or pulmonary function study

conducted according to the applicable

quality standards. The commenter

suggests these tests are not always

necessary for a relevant and credible

opinion, and cites three examples: (i) A

physician diagnoses an obstructive lung

impairment based on valid pulmonary

function testing, examination, etc., but

does not obtain an x-ray. With respect

to the mandatory x-ray requirement, the

Department has previously addressed

this argument in the second notice of

proposed rulemaking, 64 FR 54977 (Oct.

8, 1999), and reiterates its position in

responding to comments under

§ 718.101 of this rule. X-rays are an

integral part of any informed and

complete pulmonary evaluation of a

miner; a general requirement for

inclusion of this test is therefore

appropriate. The Department also notes,

however, that the quality standards

require only ‘‘substantial compliance’’

with the various criteria, not technical

compliance with every criterion in

every quality standard in every case. A

factfinder may conclude the omission of

an x-ray does not undermine the overall

credibility of the opinion, but this

determination must be made on a caseby-case basis. The same commenter

poses this example in the context of

§ 718.101. The Department’s response to

that hypothetical makes certain critical

assumptions in concluding the

physician’s opinion may be found in

‘‘substantial compliance’’ with the

quality standards: the valid pulmonary

function study demonstrates the

presence of a pulmonary/respiratory

impairment; the physician’s

examination of the miner identifies

signs or symptoms of a pulmonary

condition; and the physician has an

accurate understanding of the miner’s

employment, smoking and personal

histories. If the clinical tests and other

information provide a documented basis

for a reasoned and reliable opinion, the

factfinder may find the diagnosis of

‘‘legal pneumoconiosis’’ in ‘‘substantial

compliance’’ with § 718.104 despite the

absence of the x-ray. (ii) A physician

finds complicated pneumoconiosis on

an x-ray, but does not conduct a

pulmonary function test. One means of

diagnosing complicated

pneumoconiosis is by x-ray. 30 U.S.C.

921(c)(3)(A). The x-ray evidence is

relevant to §§ 718.202(a)(3) and

718.304(a); accordingly, § 718.102

provides the applicable quality

standards, and not § 718.104. The lack

of a pulmonary function study does not

affect the probative value of the x-ray

reading(s) as evidence of complicated

pneumoconiosis under 30 U.S.C.

921(c)(3)(A), because a pulmonary

function study is not relevant to that

means of invoking the irrebuttable

presumption. Although all relevant

evidence must be weighed in

determining whether the miner has

complicated pneumoconiosis, Melnick

v. Consolidation Coal Co., 16 Black

Lung Rep. 1–31, 1–33 (1991), the

evidence must pertain to the means of

diagnosing or refuting the existence of

complicated pneumoconiosis as

provided by 30 U.S.C. 921(c)(3)(B) and

(C). Cf. Double B Mining v. Blankenship,

177 F.3d 240, 243 (4th Cir. 1999)

(holding factfinder must determine

whether evidence relevant to each

method of invoking irrebuttable

presumption is ‘‘equivalent,’’ and

establishes same underlying condition).

The physician’s report may provide

additional valuable insight into his or

her reasons for interpreting the x-ray as

positive for complicated

pneumoconiosis rather than some other

condition detectable by x-ray; to that

extent, the report may be relevant to

weighing the credibility of the x-ray

evidence. As a report of physical

examination, however, the hypothetical

report does not satisfy the ‘‘substantial

compliance’’ standard. (iii) In his report

of physical examination, a physician

relies in part on a noncomplying

pulmonary function test, but another

complying test yields comparable

results. Again, ‘‘substantial compliance’’

is a test of evidentiary reliability based

on all relevant circumstances of the

particular case. The factfinder must

evaluate those circumstances and

determine whether the specific

omission undermines the credibility of

the evidence. In the hypothetical, the

factfinder must consider not only the

defects in the physician’s pulmonary

function study, but also the remaining

documentation in the report (other

clinical studies, the miner’s

employment, smoking and personal

information, etc.). If the report

otherwise complies with § 718.104, the

invalid pulmonary function study may

be mitigated by the presence of a

complying study which confirms the

physician’s interpretation of the invalid

study.

(d) One comment supports the

revision of § 718.104(a)(6) in the second

notice of proposed rulemaking, which

exempts a miner from mandatory

pulmonary function testing if the test is

medically contraindicated, and allows a

physician preparing a report of physical

examination to substitute other

medically acceptable clinical and

laboratory diagnostic techniques in

support of his conclusions. 64 FR

54976, 55011 (Oct. 8, 1999).

(e) One comment recommends the

Department delete the conditions in

§ 718.104(c) that, in the case of a

deceased miner, limit the consideration

of a report from a physician who is not

available if the report is not in

substantial compliance with the quality

standards. This provision permits the

adjudicator to base a finding on such

evidence only if the record does not

contain any physician’s report which is

in substantial compliance. No change in

the regulation is necessary. Although

‘‘substantial compliance’’ is a flexible

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79933

concept, it is also necessary to ensure

that claims are adjudicated using the

most reliable evidence available.

Consequently, the Department has

incorporated limitations throughout the

quality standards on the use of

noncomplying evidence in claims

involving deceased miners in which

there is no complying evidence of

record. The fact that a miner is deceased

is not necessarily a bar to rehabilitating

noncomplying evidence. With respect to

reports of physical examination, the

physician who is available to review

and further comment on his or her own

report may cure the defect and bring the

report into substantial compliance. If,

however, the physician is unavailable,

§ 718.104(c) permits noncomplying

evidence to be considered if there is no

complying evidence of record. The

Department believes noncomplying

evidence should be used to establish

facts about a deceased miner’s condition

only when no practical alternative is

available. As long as complying

evidence or the means of achieving

compliance exist, noncomplying

evidence should not be the basis for

determining the validity of a claim.

(f) One comment objects to the

retroactive application of the changes

made to § 718.104. None of these

changes, however, apply retroactively.

Section 718.101(b) provides that the

‘‘standards for the administration of

clinical tests and examinations’’ will

govern all evidence developed in

connection with benefits claims after

the effective date of the final rule.

Section 718.104 contains the quality

standards for any ‘‘[r]eport of physical

examinations,’’ including reports

prepared by a miner’s treating

physician. Physicians’ medical reports

are expressly included in the terms of

§ 718.101(b). Consequently, the changes

to § 718.104 apply only to evidence

developed after the effective date of the

final rule. With respect to treating

physicians’ opinions developed and

submitted before the effective date of

the final rule, the judicial precedent

summarized in the Department’s initial

notice of proposed rulemaking

continues to apply. See 62 FR 3342 (Jan.

22, 1997). These decisions recognize

that special weight may be afforded the

opinion of a miner’s treating physician

based on the physician’s opportunity to

observe the miner over a period of time.

(g) Two comments state the ‘‘treating

physician’’ rule has no scientific basis

because a treating physician is in no

better position than any other physician

to assess a miner’s pulmonary status.

The commenters note that a primary

care physician will often, as a matter of

medical practice, refer an individual to

a physician with particular training for

specialized care; the primary care

provider may therefore have little, if

any, qualified understanding of the

patient’s health problems. The

commenters also state that the essential

basis for a reasoned diagnosis is valid

objective testing and sound

interpretation of the data rather than

patient complaints and physical

examinations. Finally, the commenters

conclude that frequency of contact alone

does not provide any advantage for a

physician in developing a

comprehensive understanding of the

patient’s condition. The commenters’

concerns do not provide a basis for

abandoning the rule. First, the miner’s

‘‘treating physician’’ is not necessarily

the physician with whom the miner has

a long-standing generalized relationship

if another physician actually provides

specialized treatment for respiratory or

pulmonary problems. If the miner’s

primary care provider refers the miner

to a pulmonary specialist for treatment,

then that specialist may be considered

the miner’s ‘‘treating physician’’ for

purposes of his or her pulmonary

condition. If, however, the specialist

provides an opinion to the primary care

physician which forms the basis for the

miner’s treatment by the latter, the

primary care physician’s opinion is

strengthened by reliance on the

specialist’s expertise. Second, the

Department agrees that valid clinical

testing and a reasoned medical report

are necessary prerequisites for a credible

medical opinion. A treating physician’s

opinion is subject to the Department’s

quality standards, which require the

report to be based on specific clinical

tests, findings and other data and

information. See § 718.104(a)(l)-(6). A

treating physician’s report must be

reasoned as well as documented

(§ 718.104(d)(5)). In this regard, a

treating physician’s opinion is no

different than any other physician’s

opinion developed in connection with a

claim for benefits. The Department does

not intend to displace the long-standing

judicial precedent that sanctions the

rejection of a treating physician’s report

if it fails the basic requirements for

credible evidence. See, e.g., Sterling

Smokeless Coal Co. v. Akers, 131 F.3d

43 8, 441 (4th Cir. 1997); Lango v.

Director, OWCP, 104 F.3d 573, 577 (3d

Cir. 1997); Peabody Coal Co. v. Helms,

901 F.2d 571, 573–74 (7th Cir. 1990);

see generally Halsey v. Richardson, 441

F.2d 1230, 1236 (6th Cir. 1971)

(rejecting ‘‘a mechanical rule insulating

a treating doctor’s opinion from attack,

no matter how respectable and

persuasive may be opposing opinions by

doctors who examined a claimant on

only one occasion’’). As for the

commenters’ statement that the

frequency of patient contact provides no

advantage to a physician, this view is

too simplistic. Frequency of treatment is

only one of the regulatory criteria

(§ 718.104(d)(3)) the adjudicator must

consider in assessing the treating

physician relationship. The number of

visits must be viewed in the context of

the other criteria (nature of relationship,

duration of relationship, type and extent

of treatment). The totality of the

information demanded by the criteria

establishes the overall quality of the

doctor-patient relationship, which

guides the adjudicator in determining

whether to accord the treating

physician’s opinion controlling weight.

The comments do not state a basis for

changing or eliminating the ‘‘treating

physician’’ rule.

(h) Two comments contend the

‘‘treating physician’’ rule creates an

‘‘evidentiary preference’’ which violates

section 7 of the Administrative

Procedure Act (APA), 5 U.S.C. 556.

Although the Social Security

Administration (SSA) has also

promulgated a regulation, 20 CFR

404.1527(d) (1999), addressing the

weight to be given a treating physician’s

opinion, the commenters argue there is

no adverse party in SSA claims, and the

APA does not apply to SSA claims

adjudication. By implication, the

commenters suggest the Department

cannot adopt a ‘‘treating physician’’ rule

comparable to the SSA model, or any

rule which affords special weight to a

treating physician’s opinion. The

Department disagrees. As an initial

matter, whether the APA does or does

not apply to SSA claims adjudications

is irrelevant to evaluating the validity of

§ 718.104(d). The Supreme Court has

expressly refused to resolve the issue

because ‘‘the social security

administrative procedure does not vary

from that prescribed by the APA.

Indeed, the latter is modeled upon the

Social Security Act.’’ Richardson v.

Perales, 402 U.S. 389, 409 (1971). In any

event, the commenters misapprehend

both the nature of § 718.104(d) and the

critical differences between that

regulation and the SSA version. The

commenters describe the ‘‘treating

physician’’ rule as an ‘‘evidentiary

preference.’’ The Department interprets

this phrase to characterize the rule as a

burden-shifting presumption which

imposes on the party opposing the claim

the burden to overcome the

‘‘preference’’ for the treating physician’s

opinion. The Department, however, has

repeatedly emphasized in the second

79934 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

notice of proposed rulemaking and its

responses to comments in this rule that

§ 718.104(d) does not create a

presumption in favor of the treating

physician’s opinion. See 64 FR 54976–

77 (Oct. 8, 1999). The regulation

provides a set of criteria to guide the

adjudicator’s evaluation of the treating

physician’s professional relationship

with the miner, and ensure a critical

and thorough factual determination

whether that opinion should ultimately

be given ‘‘controlling weight.’’ Aside

from assessing the strength or weakness

of the treating physician’s report, the

adjudicator must also weigh that report

against all other relevant evidence in the

record. Consequently, § 718.104(d) is

not a strict, outcome-determinative rule

like more traditional evidentiary

presumptions. These characteristics also

distinguish § 718.104(d) from SSA’s

version in 20 CFR 404.1527(d). Both

regulations state that ‘‘controlling

weight’’ may be given to a treating

physician’s report. Section 404.1527(d),

however, provides that ‘‘[g]enerally, we

give more weight to opinions from your

treating sources, * * *.’’ 20 CFR

404.1527(d)(2) (1999). This language

demonstrates an affirmative preference

for reports from treating physicians;

§ 718.104(d) is more qualified in

permitting ‘‘controlling weight’’ only if

the regulatory criteria warrant it.

Another significant difference between

the regulations is the role the criteria

play in determining the weight given

the medical evidence. Section

404.1527(d) makes the criteria relevant

only after the adjudicator refuses to give

the treating physician ‘‘controlling

weight:’’ ‘‘Unless we give a treating

source’s opinion controlling weight

* * * we consider all of the following

factors in deciding the weight we give

to any medical opinion.’’ The regulation

lists several criteria which are similar to

those listed in § 718.104(d)(l)-(4).

Section 718.104(d) makes the same

criteria the basis for determining in the

first place whether to give the treating

physician controlling weight. To the

extent 20 CFR 404.1527(d) operates like

an evidentiary presumption, it does not

affect the validity of § 718.104(d)

because § 718.104(d) clearly is not a

presumption in favor of the treating

physician’s opinions. Accordingly, the

Department rejects the commenters’

position that the rule violates the APA.

(i) Three comments oppose the

requirement in § 718.104(d)(5) that the

adjudicator must weigh a treating

physician’s opinion against the contrary

relevant evidence in the record. One

comment states that affording a treating

physician’s opinion ‘‘controlling

weight’’ is meaningless unless the

adjudicator may accept the opinion

despite a reasoned and documented

contrary opinion by a pulmonary

specialist submitted by another party;

otherwise, according to the commenter,

a treating physician’s opinion will

prevail only when it echoes similar

opinions from other physicians.

Another comment interprets subsection

(d) as a burden-shifting device which

affords the treating physician’s opinion

presumptive controlling weight unless

the opposing party overcomes that

opinion by a preponderance of the

evidence. The Department has

previously responded to comments

contending that a treating physician’s

opinion should receive conclusive

weight once the adjudicator reviews the

opinion in light of the criteria

enumerated in subsection (d)(1)–(4). 64

FR 54976 (Oct. 8, 1999). The

Department rejected this position

because it artificially limits the

adjudicator’s consideration of the

evidence, and may promote a

mechanistic and uncritical acceptance

of the treating physician’s opinion at the

expense of more credible contrary

evidence. No basis for departing from

this position is established by the new

comments. The Department emphasizes

that the ‘‘treating physician’’ rule guides

the adjudicator in determining whether

the physician’s doctor-patient

relationship warrants special

consideration of the doctor’s

conclusions. The rule does not require

the adjudicator to defer to those

conclusions regardless of the other

evidence in the record. The adjudicator

must have the latitude to determine

which, among the conflicting opinions,

presents the most comprehensive and

credible assessment of the miner’s

pulmonary health. For the same reasons,

the Department does not consider

subsection (d) to be an evidentiary

presumption which shifts the burden of

production or persuasion to the party

opposing entitlement upon the

submission of an opinion from a miner’s

treating physician. Accordingly, the

Department declines to eliminate the

requirement in subsection (d)(5) that a

treating physician’s opinion must be

considered in light of all relevant

evidence in the record.

(j) One comment objects to comparing

a treating physician’s qualifications to

those of any other physician in the

record. The commenter suggests

comparative qualifications may provide

a basis for refusing controlling weight to

the treating physician’s opinion if

another physician has superior

credentials. The Department responded

to a similar comment in the second

notice of proposed rulemaking, and

noted that professional credentials are

only one factor the adjudicator may

consider in weighing medical opinions.

64 FR 54977 (Oct. 8, 1999). No basis

exists, however, for insulating the

treating physician from a consideration

of his or her qualifications, or

prohibiting giving additional weight to

the opinion of a physician with

specialized training in a relevant area of

medicine. Although expertise is only

one of several potentially relevant

factors to consider, it is nonetheless a

significant consideration. See, e.g.,

Milburn Colliery Co. v. Hicks, 138 F.3d

524, 536 (4th Cir. 1998). Furthermore,

the commenter’s concern over

comparative qualifications overlooks an

important consideration underlying the

‘‘treating physician’’ rule. In black lung

benefits claims, the principal issue

ordinarily is the miner’s pulmonary

condition. The treating physician may

develop a more in-depth knowledge and

understanding of that issue than a

physician with greater academic

credentials and minimal, or nonexistent,

contact with the miner. The purpose of

the § 718.104(d) criteria is to enable the

adjudicator to determine whether the

treating physician has such informed

knowledge that his or her opinion

merits special weight.

(k) One comment suggests a

consultative physician’s opinion should

receive the same weight accorded a

treating physician if the consultant

relies on the treating physician’s report,

the results of clinical tests, medical

records, etc., and the consulting report

satisfies the § 718.104(d) criteria. The

Department rejects this suggestion. If

any physician (other than the treating

physician) could receive enhanced

weight by incorporating consideration

of the treating physician’s opinion into

his or her consulting opinion, the

consultative physician(s) for each party

would stand on equal footing based on

access to the treating physician’s report.

No reason would therefore exist for the

rule. In any event, a consultative

physician’s reliance on the treating

physician’s report does not necessarily

confer the same benefit the treating

physician may derive from the nature,

duration, frequency and extent of

treatment during the physician-patient

relationship with the miner.

(l) Two comments oppose making the

quality standards applicable to the

report of physical examination prepared

by a miner’s treating physician. The

commenters suggest removing

subsection (d) from § 718.104 and

making it a separate regulation. The

Department rejected the identical

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79935

argument in the second notice of

proposed rulemaking. 64 FR 54976–77

(Oct. 8, 1999). The Department intends

the quality standards to apply to any

physician’s report developed in

connection with a claim for benefits,

including any report prepared by a

treating physician. Although a treating

physician may have a superior

perspective on the miner’s health in

certain circumstances, status alone does

not guarantee the validity of the

physician’s opinion.

(m) Two comments recommend

allowing a miner or a miner’s family

members to attest to the nature of the

miner’s relationship with his or her

treating physician. The Department

disagrees. Although persons other than

the physician may have some direct

knowledge of the miner’s treatment,

only the physician can provide a

complete picture of the doctor-patient

relationship, as well as documentary

evidence of the specific clinical tests

conducted. In addition, if

representations as to the criteria in

(d)(1) through (4) are challenged, it is

the physician’s records, including

treatment notes, etc., which will enable

the adjudicator to evaluate the quality of

the relationship. Evidence from persons

other than the physician may

supplement the physician’s

characterization of the miner’s

treatment, but the physician (or the

physician’s records) remains the best

primary source for depicting the miner’s

treatment.

(n) In the second notice of proposed

rulemaking, the Department invited

comment on alternatives to the revised

‘‘treating physician’’ rule, including

whether to adopt a version of the rule

comparable to the Social Security

Administration’s (SSA) regulation, 20

CFR 404.1527(d) (1999). 64 FR 54976

(Oct. 8, 1999). (i) Two comments oppose

in general terms using the SSA

regulation to evaluate the treating

physician’s opinion. (ii) One comment

recommends incorporating language

from the SSA regulation that more

weight should ‘‘generally’’ be given a

miner’s treating physician. See 20 CFR

404.1527(d)(2) (1999). The commenter

opposes any other use of the SSA

regulation. The additional language is

inappropriate. See paragraph (h), above.

Section 718.104(d) outlines the

circumstances in which a treating

physician may be afforded ‘‘controlling

weight’’ on entitlement issues. Although

the regulation recognizes the special

value which may attach to a treating

physician’s report in certain

circumstances, the Department does not

intend to deflect attention from the

necessity for critical examination of the

physician’s reasoning and

documentation. The Department has

previously explained the intended

limits of section 718.104(d) as an

evidentiary rule which guides

consideration of a treating physician’s

opinion but does not impose a strict

outcome. 64 FR 54977 (Oct. 8, 1999).

The recommended additional language

does not further this purpose.

Accordingly, the recommendation is

rejected. (iii) No comment

recommended adopting the SSA

regulation in place of the regulation as

proposed by the Department.

(o) Several comments approve

generally of the ‘‘treating physician’’

rule.

(p) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.105

(a)(i) In the initial notice of proposed

rulemaking, the Department proposed

amending § 718.105 to address arterial

blood gas studies which are

administered during a miner’s terminal

hospitalization, i.e., ‘‘deathbed’’ studies.

62 FR 3342–43 (Jan. 22, 1997).

Specifically, the Department expressed

concern that such studies may produce

qualifying values for reasons unrelated

to chronic pulmonary disease. The

Department therefore suggested a new

requirement that a claimant must

submit a physician’s report linking the

blood gas study results to a chronic

pulmonary condition caused by

exposure to coal mine dust in order to

rely on the qualifying results as

evidence of total disability. 62 FR 3375

(Jan. 22, 1997). (ii) In response to

comments received, the Department

deleted the requirement that, in the case

of blood gas studies administered

during a hospitalization that ends in the

miner’s death, the chronic pulmonary

condition must be shown to be related

to the miner’s exposure to coal mine

dust; the Department agreed the

causation requirement was

inappropriate because § 718.105

addresses the existence of a chronic

pulmonary impairment, and not its

source. 64 FR 54977–78 (Oct. 8, 1999).

The Department also agreed to a minor

change in technical nomenclature by

changing ‘‘p’’ to ‘‘P’’ to denote partial

pressure. Finally, the Department

rejected those comments which opposed

requiring the claimant to establish a link

between a miner’s ‘‘deathbed’’ blood gas

study and a chronic pulmonary

condition. The Department concluded

the proposed requirement was necessary

because the miner’s qualifying test

results during a terminal hospitalization

may be related to an acute nonpulmonary condition rather than a

chronic pulmonary impairment. 64 FR

54977 (Oct. 8, 1999).

(b) One comment recommends the

Department afford consideration to

noncomplying blood gas studies in the

case of a deceased miner since such

consideration is given elsewhere in the

regulations for x-rays (§ 718.102(e)) and

pulmonary function studies

(§ 718.103(c)). The regulations also

outline specific circumstances under

which a report of physical examination

of a miner now deceased may be

considered by an adjudication officer

notwithstanding its failure to

substantially comply with § 718.104(a)

and (b). See § 718.104(c), above. The

Department agrees, and has revised

§ 718.105 accordingly by adding

subsection (e). This provision is

comparable to § 718.103(c), and permits

the adjudicator to consider a deceased

miner’s blood gas studies not in

substantial compliance with subsections

(a), (b) and (c) if they are the only

available tests and, in the adjudicator’s

opinion, are technically valid.

Subsection (e) also requires any such

test to meet the requirements of

subsection (d) if the test was obtained

during a miner’s hospitalization ending

in death and yielded qualifying values.

The claimant must submit a physician’s

opinion establishing that the qualifying

values reflect a chronic pulmonary

impairment and not some acute

condition unrelated to a chronic

pulmonary impairment.

(c) Two comments oppose requiring

the claimant to prove a miner’s chronic

respiratory or pulmonary impairment

caused his qualifying ‘‘deathbed’’ blood

gas results. The commenters argue that

the party opposing entitlement should

bear the burden of proving a nonrespiratory or non-pulmonary condition

caused the qualifying results since that

party has equal access to the miner’s

hospital records and physicians. The

Department disagrees. The claimant

bears the general burden of persuasion

to establish entitlement to benefits by a

preponderance of the evidence, except

to the extent a presumption eases that

burden. See generally Director, OWCP v.

Greenwich Collieries, 512 U.S. 267

(1994). One facet of the claimant’s

burden is the responsibility to ensure

that the clinical tests such as blood gas

studies substantially comply with the

quality standard. The quality standard

provides some assurance to the

adjudicator that the clinical test is valid,

accurate and reliable evidence of the

factual proposition for which it is

proffered. The Department considers a

physician’s opinion necessary to

establish a nexus between ‘‘deathbed’’

79936 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

blood gas studies and a chronic

pulmonary disease; raw clinical test

results under these circumstances are

not sufficiently instructive for a lay

adjudicator to make such a

determination. The fact that the party

opposing entitlement may have equal

access to relevant information about the

circumstances and interpretation of the

blood gas testing is not determinative in

allocating the burden of persuasion. The

Department does not perceive any basis

for shifting the overall burden of proof

from the claimant to the opposing party

in the case of qualifying ‘‘deathbed’’

blood gas studies. The comments do not

address the Department’s explanation in

the second notice of proposed

rulemaking, 64 FR 54977–78 (Oct. 8,

1999), for imposing this requirement,

beyond noting continued opposition.

The Department therefore rejects the

comments’ position.

(d) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.106

(a) The Department proposed minor

changes to § 718.106 in the initial notice

of proposed rulemaking to account for

the adoption of a general standard of

substantial compliance with the quality

standards (§ 718.101), and to adopt

consistent terminology for evidence

which is not in substantial compliance

with the applicable standard. 62 FR

3343 (Jan. 22, 1997). The Department

responded to several comments in the

second notice of proposed rulemaking.

64 FR 54978 (Oct. 8, 1999). At the

urging of several commenters, the

Department restored subsection (c) to

§ 718.106, explaining that the omission

of that provision from the initial

proposed version of the regulation was

inadvertent. Other comments expressed

concern that the requirement for a gross

macroscopic inspection of the lungs

would preclude reliance on reviewing

physicians, who ordinarily review only

the autopsy protocol and inspect tissue

samples microscopically. The

Department responded that only the

autopsy itself must include the gross

macroscopic inspection of the lungs; the

requirement does not extend to opinions

prepared by reviewing physicians.

Finally, the Department rejected the

recommendation of some commenters to

adopt the standards for diagnosing

pneumoconiosis by autopsy or biopsy

set forth in Kleinerman et al.,

‘‘Pathologic Criteria for Assessing Coal

Workers’’ Pneumoconiosis,’’ in the

Archives of Pathology and Laboratory

Medicine (1979). The Department

emphasized its historic reluctance to

adopt specific standards for such

diagnoses; the lack of evidence in the

record that the medical community

agrees on a particular standard; and the

lack of evidence indicating the

Kleinerman article reflects an accepted

standard.

(b)(i) One comment again

recommends adopting the criteria for

diagnosing pneumoconiosis by autopsy

or biopsy contained in the Kleinerman

article as the ‘‘accepted’’ pathologic

standard. The Department has

previously noted that the record does

not substantiate the existence of a

consensus among physicians for making

diagnoses using these criteria, or the

acceptance of the Kleinerman article as

representative of the medical

community’s views. 64 FR 54978 (Oct.

8, 1999). Indeed, two other commenters

commend the Department for refusing to

accept these criteria, noting that other

pathologists do not agree that this article

represents a universal or prevailing

standard. One commenter suggests, for

example, that Dr. Kleinerman’s view

that a two-centimeter lesion on autopsy

or biopsy is necessary for a diagnosis of

complicated pneumoconiosis is not

universally accepted, and that other

pathologists would require only a onecentimeter lesion. The commenter

urging adoption of the Kleinerman

criteria does not supply any additional

information in support of its

recommendation. The Department

therefore has no basis in the record for

adopting the suggested standard. (ii)

One comment cites Double B Mining,

Inc. v. Blankenship, 177 F.3d 240 (4th

Cir. 1999), as legal authority for

rejecting the Kleinerman article. In that

case, the Court considered whether a

biopsy diagnosis of a certain-sized

fibrotic nodule amounted to a ‘‘massive

lesion’’ for purposes of proving the

miner had complicated pneumoconiosis

under 30 U.S.C. 921(c)(3) (irrebuttable

presumption of total disability due to

pneumoconiosis invoked by proof of

complicated pneumoconiosis). The

Court cited, among other sources, the

Kleinerman article as requiring a

minimum two-centimeter nodule to

constitute a ‘‘massive lesion.’’ The Court

declined to adopt the two-centimeter

rule because ‘‘[t]he [Black Lung Benefits

Act] does not mandate use of the

medical definition of complicated

pneumoconiosis.’’ 177 F.3d at 244.

Instead, the Court held the adjudicator

must determine whether a particular

nodule discovered by biopsy would be

equivalent to a one-centimeter opacity if

diagnosed by x-ray. The Blankenship

decision rejects only the mandatory use

of the medical community’s standards

for diagnosing complicated

pneumoconiosis by biopsy in view of

the court’s statutory analysis. The Court

does not accept or reject any specific

clinical criteria for biopsy diagnoses,

and the Department does not interpret

the decision as repudiating the

Kleinerman article in particular.

(c)(i) Three comments approve of the

restored paragraph (c). (ii) Two

comments approve of the Department’s

clarification in the second notice of

proposed rulemaking that the

§ 718.106(a) requirement for a gross

macroscopic inspection of the lungs

applies only to the autopsy itself and

not to a reviewing physician’s opinion.

64 FR 54978 (Oct. 8, 1999).

(d) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.107

(a) In the initial notice of proposed

rulemaking, the Department proposed a

clarification of § 718.107 which

addresses medical evidence not

otherwise covered by the quality

standards. 62 FR 3343 (Jan. 22, 1997).

Proposed subsection (b) required the

party submitting such evidence to

establish that the evidence is medically

acceptable and relevant to proving the

existence or nonexistence of

pneumoconiosis, the sequelae of

pneumoconiosis or a ‘‘respiratory

impairment.’’ The Department

responded to comments received from

the public in the second notice of

proposed rulemaking. 64 FR 54978 (Oct.

8, 1999). The Department changed the

reference in subsection (a) from

‘‘respiratory impairment’’ to

‘‘respiratory or pulmonary impairment.’’

The Department rejected as unnecessary

a recommendation that disability and

disability causation should be added to

the relevant issues because the

regulation adequately stated the

purposes for which ‘‘other medical

evidence’’ could be submitted. One

comment approved of § 718.107 as

proposed in the initial notice of

proposed rulemaking.

(b) For purposes of the final rule, the

Department emphasizes that § 718.107

as a whole is intended to permit any

party to offer any medical test or

procedure which may be relevant to any

disputed medical issue relating to a

claimant’s entitlement to benefits

provided the requirements of subsection

(b) are met.

(c) No other comments were received

concerning this section, and no other

changes have been made in it.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79937

Subpart C

20 CFR 718.201

(a) In the initial notice of proposed

rulemaking, the Department proposed

amending § 718.201. 62 FR 3343–44,

3376 (Jan. 22, 1997). The amendments

were designed to clarify the regulatory

definition and conform it to the statute,

which broadly defines pneumoconiosis

as ‘‘a chronic dust disease of the lung

and its sequelae, including respiratory

and pulmonary impairments, arising out

of coal mine employment.’’ 30 U.S.C.

902(b). To that end, the Department

proposed three revisions.

First, the Department inserted the

terms ‘‘clinical’’ and ‘‘legal’’

pneumoconiosis into the regulation to

conform it to the terminology uniformly

adopted by the courts to distinguish

between the two forms of lung disease

compensable under the statute:

pneumoconiosis, as that disease is

defined by the medical community, and

any chronic lung disease arising out of

coal mine employment. Second, the

Department proposed revising the

definition to make clear that both

restrictive and obstructive lung disease

may fall within the definition of

pneumoconiosis if shown to have arisen

from coal mine employment. Third, the

Department proposed a revision to

recognize the latent and progressive

nature of the disease. The last two

changes, for which the Department cited

scientific evidence in support, 62 FR

3343–44 (Jan. 22, 1997), were proposed

as a result of recent litigation on these

issues. The Department specifically

sought comments on these revisions.

The Department received numerous

favorable and unfavorable comments

and testimony on the proposals. 64 FR

54978–79 (Oct. 8, 1999). One

commenter objected to the revised

definition because it would include all

obstructive pulmonary diseases. A

number of commenters complained that

the Department lacked the statutory

authority to implement the proposals,

and that the Department had violated

the statute by failing to consult with the

National Institute for Occupational

Safety and Health (NIOSH) before

proposing the changes. 30 U.S.C.

902(f)(1)(D). Several commenters also

argued that the Department’s proposed

definition was scientifically unsound,

and presented testimony from a panel of

pulmonary physicians at the

Department’s July 22, 1997 hearing in

Washington, D.C., to substantiate their

views. Two commenters contended that

because Congress had rejected an

amendment to the statutory definition of

pneumoconiosis which would have

included obstructive lung disorders, the

Department could not accomplish the

same change through regulation. The

Department also received numerous

comments in support of the revised

definition. Among the favorable

comments was one from NIOSH,

transmitted by letter dated August 20,

1997 and signed by Dr. Paul A. Schulte,

Director of NIOSH’s Education and

Information Division. Rulemaking

Record, Exhibit 5–173. NIOSH

supported the Department’s proposal to

amend the definition to include chronic

obstructive pulmonary disease and to

reflect the scientific evidence that

pneumoconiosis is a progressive

condition that may become detectable

only after cessation of coal mine

employment in some cases. The

Department also received favorable

comments and testimony from

physicians with expertise in pulmonary

diseases.

Given the widely divergent comments

and testimony received from medical

professionals on the proposed

regulation, the Department sought

additional guidance from NIOSH,

notwithstanding the fact that NIOSH

had already commented in support of

the initial proposal. The Department

transmitted a copy of all of the

testimony and commentary it had

received to Dr. Linda Rosenstock, the

Director of NIOSH, and asked NIOSH to

determine, in light of the then existing

record, whether NIOSH continued to

support the Department’s proposal.

Rulemaking Record, Exhibit 66. NIOSH

responded, in a December 7, 1998 letter

from Dr. Schulte, that ‘‘[t]he unfavorable

comments received by DOL do not alter

our previous position: NIOSH scientific

analysis supports the proposed

definitional changes.’’ Dr. Schulte

provided additional medical references

to support NIOSH’s conclusion.

Rulemaking Record, Exhibit 72.

The Department responded to the

comments it had received in its second

notice of proposed rulemaking. 64 FR

54978–79 (Oct. 8, 1999). The

Department emphasized that the

proposed revision was designed to make

clear that obstructive lung disease may

fall within the definition of

pneumoconiosis, but only if it is shown

to have arisen from coal mine

employment; thus, the proposed

definition would not alter the former

regulations’ (20 CFR 718.202(a)(4),

718.203 (1999)) requirement that each

miner bear the burden of proving that

his lung disease arose out of his coal

mine employment. The Department also

notified the public of NIOSH’s

December 7, 1998 response, including

the additional evidence NIOSH cited. 64

FR 54978–79 (Oct. 8, 1999). Recognizing

that Congress created NIOSH as a source

of expertise in occupational disease and

the analysis of occupational disease

research, the Department concluded it

saw no scientific or legal basis upon

which to alter its proposed change to

the definition of pneumoconiosis. The

Department further stated its

disagreement that Congressional

inaction invalidated its proposed

revision of the definition since it was

acting within the scope of Congress’

grant of regulatory authority.

Accordingly, the Department proposed

no additional changes to this regulation

in the second notice of proposed

rulemaking. 64 FR 55012–13 (Oct. 8,

1999). The Department has now

amended subsection (a)(1) by deleting a

comma for grammatical reasons.

(b) The Department has again received

both favorable and unfavorable

comments on its proposed revision to

the definition of pneumoconiosis. To

the extent these comments are directed

specifically to the Department’s

proposal to define pneumoconiosis as a

latent and progressive disease, the

Department’s response is set forth in the

preamble under § 725.309. The

Department responds here to the

remainder of the relevant comments,

including those addressing the

Department’s proposal to include

obstructive lung diseases arising out of

coal mine employment within the

definition of pneumoconiosis. Where a

scientific article or treatise is cited, the

Department has also cited to a

Rulemaking Record Exhibit or, when

appropriate, the Federal Register, where

that source appears. This second

citation is not an exhaustive list; thus,

each source may appear at additional

points in the Rulemaking Record.

(c) One comment objects to the

Department’s inclusion of the term

‘‘legal pneumoconiosis’’ in the revised

definition because there is no such

‘‘phenomenon.’’ Another comment

expresses the concern that the revised

regulation would create a new medical

diagnosis. The statute defines

pneumoconiosis as ‘‘a chronic dust

disease of the lung and its sequelae,

including respiratory and pulmonary

impairments, arising out of coal mine

employment.’’ 30 U.S.C. 902(b). This

broad definition encompasses not only

coal workers’ pneumoconiosis as that

disease is contemplated by the medical

community, but also any other chronic

lung disease demonstrably related to

coal mine employment but not typically

denominated as pneumoconiosis in

medical circles. Thus, the Department is

making a legal distinction, rather than a

medical one, by employing the phrase

‘‘legal pneumoconiosis’’ in order to

79938 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

properly implement Congress’ intent. In

so doing, the Department is

acknowledging the distinction already

adopted by the circuit courts of appeals

in construing and applying the statutory

definition. See, e.g., Gulf & Western

Industries v. Ling, 176 F.3d 226, 231–32

(4th Cir. 1999); Bradberry v. Director,

OWCP, 117 F.3d 1361, 1368 (11th Cir.

1997); Labelle Processing Co. v.

Swarrow, 72 F.3d 308, 315 (3d Cir.

1995); Consolidation Coal Co. v. Hage,

908 F.2d 393, 395–396 (8th Cir. 1990);

Campbell v. Consolidation Coal Co., 811

F.2d 302, 304 (6th Cir. 1987); Peabody

Coal Co. v. Lowis, 708 F.2d 266, 268 n.4

(7th Cir. 1983).

(d) Several comments express concern

over including obstructive pulmonary

diseases in the definition of

pneumoconiosis, believing such change

will result in compensating miners for

diseases caused by factors unrelated to

coal mine employment. Whether coal

mine dust exposure can cause chronic

obstructive pulmonary disease is a

question of medical and scientific fact

that will not vary from case to case;

thus, it is an appropriate question for

the Department to answer by regulation.

See generally Peabody Coal Co. v.

Spese, 117 F.3d 1001, 1010 (7th Cir.

1997) (en banc); Davis, Administrative

Law Treatise, § 6.7, 261–262 (3d ed.

1994). The revised definition will

eliminate the need for litigation of this

issue on a claim-by-claim basis, and

render invalid as inconsistent with the

regulations medical opinions which

categorically exclude obstructive lung

disorders from occupationally-related

pathologies. The Department reiterates,

however, that the revised definition

does not alter the former regulations’ (20

CFR 718.202(a)(4), 718.203 (1999))

requirement that each miner bear the

burden of proving that his obstructive

lung disease did in fact arise out of his

coal mine employment, and not from

another source. Thus, instead of

attempting to force the conclusion, as

one commenter contends, that all

obstructive lung disorders are

compensable, or to require responsible

operators to compensate miners for nonoccupationally related diseases, the

language of the proposed regulation

makes plain that only ‘‘obstructive

pulmonary disease arising out of coal

mine employment’’ falls within the

definition of pneumoconiosis.

(e) Several comments criticize the

Department’s consultation with NIOSH.

Calling the Department’s solicitation of

an opinion from NIOSH on the relevant

medical questions a ‘‘post-hoc attempt

to rationalize the validity of its medical

conclusions’’ and a ‘‘purely political

act,’’ one commenter states that Dr.

Shulte’s letter cannot substitute for

‘‘genuine scientific review.’’ Other

commenters allege that NIOSH

presented no serious medical or

scientific analysis to support its

position. To the extent these comments

accuse the Department of obtaining

assistance from NIOSH’s information

officer rather than its scientific staff, the

Department’s response is set forth in the

preamble under § 725.309. NIOSH

voluntarily submitted its first statement

in support of the proposed revision to

the definition of pneumoconiosis during

the public comment period for the

initial rulemaking proceeding. The

Department then actively solicited an

additional opinion from NIOSH in

response to other comments the

Department had received requesting

such consultation and not, as the

commenter suggests, to provide ‘‘posthoc’’ rationalization for the proposed

revisions to the regulation. NIOSH

responded, and the Department set forth

the substance of the response in the

second notice of proposed rulemaking.

64 FR 54978–79. In response to the

second notice, NIOSH once again

submitted an unsolicited comment

during the public comment period

reaffirming its earlier statements that it

had reviewed the proposed rule and

supported it. Thus, NIOSH has

supported the Department’s proposal

from the outset. Further, in each of its

communications, NIOSH repeatedly

provided concrete support for its

comments by referencing appropriate

studies and its own publication,

National Institute for Occupational

Safety and Health, Criteria for a

Recommended Standard, Occupational

Exposure to Respirable Coal Mine Dust

(1995). 62 FR 3343 (Jan. 22, 1997);

Rulemaking Record, Exhibit 2–1. This

publication provides the most

exhaustive review and analysis of the

relevant scientific and medical evidence

through 1995, including its evaluation

of the evidence regarding the role

smoking plays in a coal miner’s

respiratory status. The conclusions

NIOSH reached there as a result of its

analysis fully support the position it has

taken in commenting during these

rulemaking proceedings. Accordingly,

the Department rejects these broadbased attacks on NIOSH’s conclusions

as a basis for altering this regulation.

(f) Various comments state, without

specificity, that the Department’s

proposed revisions to the definition of

pneumoconiosis lack valid scientific or

medical support. Other comments attack

the scientific basis of the conclusions

that the Department and NIOSH have

drawn from the evidence of record. In

support, these commenters have

submitted an analysis of some of the

available medical literature from Dr.

Gregory Fino, a Board-certified

physician in Pulmonary Diseases, and

Dr. Barbara Bahl, who has a doctorate in

nursing and biostatistics. Their review

of the literature regarding obstructive

lung disease and pulmonary

dysfunction in coal miners led them to

conclude that virtually all of the articles

they reviewed are flawed, and that there

is no evidence of a clinically significant

reduction in lung function resulting

from coal mine dust exposure.

(Rulemaking Record, Exhibit 89–37,

Appendix C). They elaborate:

There are a number of statements that can

and cannot be said about obstruction in coal

miners. Some of the articles discussed in

Table 1 above do demonstrate a reduction in

the FEV1 in highly selected cohorts of

miners. Because of selection bias, the results

cannot be applied to all miners in general.

Since the reductions in the FEV1 are

averages, it is statistically impossible to state

whether a given miner would have FEV1

reductions greater than or less than the stated

amount. The articles do not say and do not

show that coal mine dust inhalation causes

a clinically significant reduction in the FEV1.

Just because a statistically significant

reduction was encountered in the selected

cohorts, there is no evidence at all that the

reductions would participate in any

respiratory impairment or disability.

While there is no doubt that some miners

do have clinically significant obstruction as

a result of coal mine dust inhalation, it

occurs in cases of severe fibrosis where a

combined obstructive and restrictive defect is

present. However, there is no evidence that

there is a clinically significant reduction in

the FEV1 as a result of chronic obstructive

lung disease due to coal mine dust

inhalation. None of the studies show that.

None of the studies can be generalized to the

average coal miner. Moreover, statistical

significance neither implies nor infers

clinical significance. As the above studies

demonstrate, statistical significance has

created many numbers that are not applicable

to the evaluation of coal miners. The

conclusions reached by Morgan (1, 24, 35)

and published over two decades [ago] still

hold true: coal mine dust may cause slight,

clinically insignificant decreases in the FEV1

in some miners. There is no evidence that

these decreases cause or contribute to

pulmonary disability and no support for the

assumption in the Department’s regulation

that coal dust causes or contributed to any

miner’s obstructive lung disease.

Rulemaking Record, Exhibit 89–37,

Appendix C at 24–25. In a separate

review of literature relating to

emphysema in particular, Drs. Fino and

Bahl conclude that ‘‘[t]he amount of

emphysema in the lungs of miners

increases with the severity of simple

coal workers’ pneumoconiosis.’’ This

increase in severity as shown by chest

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79939

X-ray or autopsy ‘‘is not correlated with

a worsening of lung function,’’ and the

relevant studies ‘‘have not shown

clinically significant deterioration in

lung function as the emphysema

worsens.’’ Rulemaking Record, Exhibit

89–37, Appendix C at 32–33.

The Department has reviewed all of

the medical and scientific evidence

referenced in the rulemaking record,

and does not agree that the record lacks

valid support for the proposition that

coal mine dust exposure can cause

obstructive pulmonary disease. The

Department’s position is fully supported

by NIOSH, the statutory advisor to the

black lung benefits program, which

responded favorably to the Department’s

proposed revisions. Rulemaking Record,

Exhibits 5–173, 72, 89–26. The

considerable body of literature

documenting coal mine dust exposure’s

causal effect on the development of

chronic bronchitis, emphysema and

associated airways obstruction

constitutes a clear and substantial basis

for this aspect of the revised definition

of pneumoconiosis.

The term ‘‘chronic obstructive

pulmonary disease’’ (COPD) includes

three disease processes characterized by

airway dysfunction: chronic bronchitis,

emphysema and asthma. Airflow

limitation and shortness of breath are

features of COPD, and lung function

testing is used to establish its presence.

Clinical studies, pathological findings,

and scientific evidence regarding the

cellular mechanisms of lung injury link,

in a substantial way, coal mine dust

exposure to pulmonary impairment and

chronic obstructive lung disease. In

discharging its congressionallymandated duty to recommend a

permissible exposure limit for coal mine

dust, NIOSH conducted a

comprehensive review of the available

medical and scientific evidence

addressing the impact of coal mine dust

exposure on coal miners. It published

its findings in National Institute for

Occupational Safety and Health, Criteria

for a Recommended Standard,

Occupational Exposure to Respirable

Coal Mine Dust (1995) (Criteria). 62 FR

3343 (Jan. 22, 1997); Rulemaking

Record, Exhibit 2–1. NIOSH concluded

that ‘‘[i]n addition to the risk of simple

CWP and PMF [progressive massive

fibrosis], epidemiological studies have

shown that coal miners have an

increased risk of developing COPD.’’

Criteria 4.2.3.2, Rulemaking Record,

Exhibit 2–1 at 57.

Drs. Fino and Bahl disagree, but the

Department believes that their opinions

are not in accord with the prevailing

view of the medical community or the

substantial weight of the medical and

scientific literature. For example,

Seaton, in ‘‘Coal Workers’

Pneumoconiosis,’’ in Morgan WKC,

Seaton A, eds., Occupational Lung

Diseases (WB Saunders Co., 3d ed.

1995) 374–406, see also Rulemaking

Record, Exhibit 89–37, Appendix C at

34, 42, reviewed much of the same

published evidence and made the

following analysis:

Lung function, measured as the forced

expiratory volume in 1 second (FEV1) has

been shown both in cross-sectional and

longitudinal studies to decline in relation to

increasing underground dust exposure but

not in relation to estimates of exposure to

oxides of nitrogen. This decline occurs at a

similar rate in smokers and nonsmokers,

although the loss of lung function overall is

greater in smokers, the two effects being

additive.

Similarly, Becklake, in

‘‘Pneumoconiosis,’’ in Murray J, Nadel J,

eds., Textbook of Pulmonary Medicine

(1st ed. 1988) 1556–1592, see also

Criteria, Rulemaking Record, Exhibit 2–

1 at 204, concludes:

Most evidence to date indicates that

exposure to coal mine dust can cause chronic

airflow limitation in life and emphysema at

autopsy, and this may occur independently

of CWP * * * The relationships between

hypersecretion of mucus (chronic bronchitis)

and chronic airflow limitation (emphysema)

on the one hand and environmental factor of

coal mining exposure on the other appear to

be similar to those found for cigarette

smoking.

Oxman and colleagues analyzed the

available literature assessing the

relationship between occupational dust

exposures and COPD in 1993. Oxman

AD, Muir DCF, Shannon HS, Stock SR,

Hnizdo E, Lange HJ, ‘‘Occupational dust

exposure and chronic obstructive

pulmonary disease: A systematic

overview of the evidence,’’ Am Rev

Resp Dis, 148:38–48 (1993); see also

Rulemaking Record, Exhibit 5–174,

Appendix 8. Reports were analyzed for

methodological criteria including dust

exposure, control for smoking,

exclusion of confounding pulmonary

conditions, referral bias, and adequate

follow-up. Thirteen reports that met

their rigorous screening criteria were

analyzed. They concluded that all of the

studies found a statistically significant

association between cumulative dust

exposure and decline in lung function,

and that coal mine dust can be a cause

of chronic bronchitis. Unlike Drs. Fino

and Bahl, the Oxman analysis

concluded there was also a clinically

significant loss of lung function in

smokers and nonsmokers.

Drs. Fino and Bahl state that all of the

studies identifying a decline in lung

function ‘‘are flawed because of

selection bias. The results are not

generalizable to the general population

of miners.’’ Rulemaking Record, Exhibit

89–37, Appendix C at 21. As recognized

by many of the authors of these studies,

the results are susceptible to a selection

bias caused by miners leaving the

industry between the time of initial

pulmonary function measurement and

those taken later during the follow-up

period. Because of the ‘‘healthy worker

effect,’’ it would be expected that

workers more prone to the respiratory

impairments caused by coal mine dust

inhalation would leave mining and the

healthier workers would continue

working. Oxman concluded that

‘‘[a]lthough it is impossible to estimate

precisely the magnitude of this bias,’’ its

direction ‘‘is towards underestimating

the association between dust and loss of

lung function, or failure to recognize a

more susceptible subgroup of workers.’’

Oxman at 46. Thus, this selection bias

actually underestimates the association

between inhalation of coal mine dust

and loss of lung function. As Oxman

explains, ‘‘it is likely that the results

underestimate the effect of occupational

dust exposure on lung function, COPD,

and chronic bronchitis. The magnitude

of the bias is not clear, but it might, in

some cases, result in estimates that are

50% or more of the true coefficients.’’

Oxman at 47. Moreover, as Coggon and

Newman Taylor remarked in the course

of surveying the relevant medical

literature, such selection effects are

relatively unimportant because ‘‘[t]here

is no obvious reason why the relation of

symptoms and lung function to dust

should have been weaker in those

omitted from investigation.’’ Coggon D,

Newman Taylor A, ‘‘Coal mining and

chronic obstructive pulmonary disease:

a review of the evidence,’’ Thorax

53:398–407, 400 (1998); see also 64 FR

54979 (Oct. 8, 1999) Simply stated,

there is a clear relationship between

coal mine dust and COPD and lung

dysfunction, and that relationship is

likely to be stronger than what we are

able to measure.

Drs. Fino and Bahl conclude that any

minimal obstruction resulting from coal

mine dust exposure is not clinically

significant. Marine’s cross-sectional

1988 study of coal miners, however,

found clinically significant decreases in

pulmonary function in both smokers

and nonsmokers. Marine WM, Gurr D,

Jacobsen M, ‘‘Clinically important

respiratory effects of dust exposure and

smoking in British coal miners,’’ Am

Rev Resp Dis, 137:106–112 (1988); see

also Criteria, § 4.2.2.1, Rulemaking

Record, Exhibit 2–1 at 52. This study

also noted that the presence of chronic

79940 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

bronchitis was clearly related to cumulative dust exposure. The table

below summarizes the study’s data:

Cumulative dust exposure (in percent)

Measure of respiratory dysfunction

Zero exposure Intermediate exposure

(174 ghm ¥3)

High exposure

(348 ghm ¥3)

Smoker Nonsmoker Smoker Nonsmoker Smoker Nonsmoker

FEV1 <80% .............................................. 17.1 9.7 24.2 15.5 40.0 23.9

Chronic bronchitis .................................... 30.5 7.9 41.2 14.8 52.8 26.3

Chronic bronchitis+FEV1 <80% ............... 7.6 1.5 14.9 3.9 27.3 9.8

FEV1 <65% .............................................. 5.0 3.2 8.5 5.0 14.2 7.7

NOTE TO TABLE: Percentages are estimates of prevalence of measures of respiratory dysfunction based on linear logistic models at an age of

47 years at varying amounts of cumulative dust exposure.

As can be seen from this table, the

incidence of nonsmoking coal miners

with intermediate dust exposure

developing moderate obstruction (FEV1

of less than 80%) is roughly equal to the

incidence of moderate obstruction in

smokers with no mining exposure

(15.5% v. 17.1%). Similarly, the

incidence of non-smoking miners with

intermediate exposure developing

severe airways obstruction (FEV1 of less

than 65%) is equal to the incidence of

severe obstruction in non-mining

smokers (5.0% for both groups).

Nonsmokers with high exposure are at

greater risk for developing moderate or

severe obstruction than unexposed

smokers. Smokers who mine have

additive risk for developing significant

obstruction. The risk of chronic

bronchitis clearly increases with

increasing dust exposure; again smokers

who mine have an additive risk of

developing chronic bronchitis. The

message from the Marine study is

unequivocal: Even in the absence of

smoking, coal mine dust exposure is

clearly associated with clinically

significant airways obstruction and

chronic bronchitis. The risk is additive

with cigarette smoking.

Drs. Fino and Bahl criticize the

Marine study because it used the mean

of each miner’s three FEV1 values rather

than the highest. Rulemaking Record,

Exhibit 89–37, Appendix C at 17, 21.

This, however, does not appear to be a

significant problem given that a number

of other studies which used the highest

FEV1 value for analysis also showed the

same adverse relationship between coal

dust inhalation and pulmonary

impairment. One such study was

reported by Attfield and Hodous in

1992. Attfield MD, Hodous TK,

‘‘Pulmonary function of U.S. coal

miners related to dust exposure

estimates,’’ Am Rev Respir Dis 145:605–

609 (1992); see also Criteria, § 4.2.2,

Rulemaking Record, Exhibit 2–1 at 51.

Attfield and Hodous analyzed

pulmonary function data (specifically,

FEV1, FVC and FEV1/FVC ratio) drawn

from Round 1 of the National Study of

Coal Workers’ Pneumoconiosis, along

with job-specific cumulative dust

exposure estimates for U.S.

underground coal miners, to determine

whether there was an exposure-response

relationship. This group of 7,139 miners

worked both before and after 1970,

when federally-mandated dust control

standards were implemented. Allowing

for decrements due to age and smoking

history, Attfield and Hodous

demonstrated a clear relationship

between dust exposure and a decline in

pulmonary function of about 5 to 9

milliliters a year, even in miners with

no radiographic evidence of clinical

coal workers’ pneumoconiosis. These

results were similar to those reached in

studies of British coal miners.

Drs. Fino and Bahl (Rulemaking

Record, Exhibit 89–37, Appendix C at

22), as well as other commenters,

criticize this study and similar ones that

are based on exposures prior to 1970,

when federally-mandated dust control

standards were implemented, on the

grounds of selection bias. Their theory

is that only those miners who worked in

a dust-controlled environment are

representative of the current adverse

effects of coal mine dust exposure. This

theory is flawed. While lower dust

exposure should reduce both the

occurrence and the severity of lung

disease, the kinds of diseases will

remain the same. Indeed, Attfield and

Hodous specifically chose to use data

from miners with presumably higher

dust exposures so as to facilitate the

detection of exposure-response

relationships. Attfield and Hodous, Am

Rev Respir Dis 145:605.

In any event, analysis of data from

miners who worked only in dustcontrolled conditions confirm the

connection between coal mine dust

exposure and obstructive lung disease.

Seixas and colleagues considered a

group of 1,185 miners who began

working in 1970 or later. Seixas NS,

Robins TG, Attfield MD, Moulton LH,

‘‘Exposure-response relationships for

coal mine dust and obstructive lung

disease following enactment of the

Federal Coal Mine Health and Safety

Act of 1969,’’ Am J Ind Med 21:715–732

(1992); see also Criteria, § 4.2.2.3.1,

Rulemaking Record, Exhibit 2–1 at 54.

The data they reviewed was collected

during Round 4 of the National Study of

Coal Workers’ Pneumoconiosis, and

included chest X-rays, ventilatory

function tests (including FEV1, FVC and

FEV1/FVC ratio), and relevant histories

for each miner. The results of this crosssectional analysis, when adjusted for

age, race/ethnicity and smoking,

demonstrated a declination in

pulmonary function attributable to coal

mine dust-induced obstructive lung

disease.

Longitudinal studies have confirmed

these results. See generally Criteria,

§ 4.2.2.3.1.2, Rulemaking Record,

Exhibit 2–1 at 55. One noteworthy study

is Attfield MD, ‘‘Longitudinal decline in

FEV1 in United States coalminers,’’

Thorax 40:132–137 (1985); see also

Criteria, § 4.2.2.3.1.2, Rulemaking

Record, Exhibit 2–1 at 55. Using

medical data from two National Coal

Study surveys held nine years apart,

Attfield evaluated the effects of dust

exposure on a group of 1,072 miners

aged 20–49 years. The data included

chest X-rays, smoking and work

histories, and spirometry, as well as

dust exposure estimates. After

accounting for age, height and smoking,

Attfield found a coal mine dust-related

FEV1 loss of 36 to 84 ml over 11 years,

with an additional loss among smokers.

Attfield’s results confirmed similar

studies analyzing data from miners in

the U.K. See, e.g., Love RG, Miller BG,

‘‘Longitudinal study of lung function in

coal-miners,’’ Thorax 37:193–197

(1982); see also Criteria, § 4.2.2.3.1.2,

Rulemaking Record, Exhibit 2–1 at 55.

Drs. Fino and Bahl contend, however,

that the average decline shown in these

studies, while perhaps statistically

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79941

relevant, is not clinically relevant and

does not result in any impairment.

Attfield and Hodous responded

succinctly to such criticism, equating

pulmonary function decrements in

miners to the decline of lung function

in non-mining smokers from the general

population: ‘‘If it is thought that a 5- to

9-ml decrement of FEV1 per year is

clinically insignificant, it must be

remembered that the average decrement

for smokers was only 5 ml per pack

year. This, in itself, is also a minor loss

of lung function. However it is well

known that smoking can cause severe

effects in some smokers.’’ Attfield and

Hodous, Am Rev Respir Dis 145:608.

Just as not all smokers develop COPD

and pulmonary dysfunction, pulmonary

impairment is not universal in coal

miners. Drs. Fino and Bahl state that

‘‘an average loss of FEV1 means that

50% of the miners will have losses in

excess of the average and 50% will have

losses smaller than the average.’’

Rulemaking Record, Exhibit 89–37,

Appendix C at 21. This conclusion does

not stand up to scrutiny because it

confuses the average with the median.

As can be seen from Marine’s table

above, only a minority of miners will

have significant decrements in

pulmonary function. As the majority of

miners may have small or, perhaps in

some cases, no decline in pulmonary

function, the average decline of the

population studied can appear to be

relatively small. Despite this, the

individual miners affected can have

quite severe disease, and statistical

averaging hides this effect. The

amended definition clarifies that these

miners have a right to prove their case

with evidence of a disabling obstructive

lung disease that arose out of coal mine

employment.

Pointing to Coggon and Newman

Taylor’s statement that ‘‘some scientists

have expressed doubts as to whether

coal mine dust can cause clinically

important loss of lung function,’’

Coggon D, Newman Taylor A, ‘‘Coal

mining and chronic obstructive

pulmonary disease: A review of the

evidence,’’ Thorax 53:398–407 (1998);

see also 64 FR 54979 (Oct. 8. 1999);

Rulemaking Record, Exhibit 89–37,

Appendix C at 24, Drs. Fino and Bahl

state that the studies have not shown

this type of loss of pulmonary function.

Rulemaking Record, Exhibit 89–37,

Appendix C at 24. The implication that

Coggon and colleague agree with this

conclusion is misleading. The paragraph

containing the quoted sentence notes

that there is evidence connecting COPD

with coal mining and that ‘‘in view of

this continuing controversy, it is helpful

to review the evidence as it now

stands.’’ The authors reviewed data

from the National Study of Coal

Workers’ Pneumoconiosis, the

Pneumoconiosis Field Research

Programme (U.K.), studies from Sardinia

and Germany, and mortality and

necropsy studies. They concluded:

Reductions in lung function have been

found in relation to coal mining with

remarkable consistency. * * * Individually,

all of the studies that have addressed the

relation of coal mining to lung function have

limitations, but these vary from one

investigation to another and often would

tend to obscure rather than exaggerate any

effect of dust. The balance of evidence points

overwhelmingly to impairment of lung

function from coal mine dust exposure.

Coggon, Thorax 53:405. Coggon and

Newman Taylor further concluded that:

Coal mine dust inhalation can be

disabling, and arguments against this

thesis are ‘‘unconvincing’; and ‘‘the

combined effects of coal mine dust and

smoking on FEV1 appear to be

additive.’’ Coggon, Thorax 53:405–406.

Thus, this study supports the

Department’s position.

Similarly, several of the medical

treatises and studies cited by another

commenter in support of its contention

that there is no such causal link

between coal mine dust exposure and

obstructive lung disease do not negate

(and, in fact, support) the conclusion

the Department and NIOSH have

reached. See, e.g., Morgan WKC,

‘‘Pneumoconiosis,’’ in Brewis RAL,

Corrin B, Geddes DM, Gibson GJ, eds.,

Respiratory Medicine (WB Saunders Co.,

2d ed. 1995) 581; see also Rulemaking

Record, Exhibit 89–21, attachment 1 (‘‘it

is clear that bronchitis induced by coalmine dust, henceforth referred to as

industrial bronchitis, leads to a

reduction in ventilatory capacity’’);

Green FHY, Vallyathan V, ‘‘Coal

Workers’’ Pneumoconiosis and

Pneumoconiosis Due to Other

Carbonaceous Dusts,’’ in Chung A,

Green FHY, eds., Pathology of

Occupational Lung Disease (2d ed.

1998) 189; see also Rulemaking Record,

Exhibit 89–21, attachment 2 (coal dust

exposure is ‘‘associated with significant

deficits in lung function in the absence

of [clinical] CWP, reinforcing the view

that COPD and CWP have independent

risk factors’’); ‘‘Occupational Lung

Disease,’’ in Hasleton PS, ed., Spencer’s

Pathology of the Lung (5th ed. 1996)

482; see also Rulemaking Record,

Exhibit 89–21, attachment 4 (‘‘A

considerable body of evidence indicates

that chronic bronchitis and emphysema

in coal workers is directly related to

tobacco usage and cumulative exposure

to respirable dust during life.’’); Roy TM

et al., ‘‘Cigarette Smoking and Federal

Black Lung Benefits in Bituminous Coal

Miners,’’ J Occ Med 31(2):100 (1989);

see also Rulemaking Record, Exhibit

89–21, attachment 5 (‘‘Well-designed

investigations have now documented

that coal dust exposure can cause

reductions in FEV1 that are

independent of age and cigarette

smoking. * * * it appears that the major

damage caused by cigarette smoking is

additive to the minor damage which can

be attributed to coal dust.’’); Surgeon

General, U.S. Department of Health and

Human Services, ‘‘Respiratory Disease

in Coal Miners,’’ The Health

Consequences of Smoking: Cancer and

Chronic Lung disease in the Workplace,

313 (1985); see also Rulemaking Record,

Exhibit 89–21, attachment 11

(concluding that ‘‘increasing coal dust

exposure is associated with increasing

airflow obstruction in both smokers and

nonsmokers’’). To the extent this

commenter advocates that tobacco

smoking, rather than coal mine dust

exposure, causes the only significant

obstructive disorders miners develop,

and that the definition of

pneumoconiosis ‘‘must be tightened to

deal with the truth of tobacco’s role in

causing what has been compensated as

black lung,’’ the Department reiterates

that the studies cited above, as well as

others, found a significant decrement in

coal miners’ pulmonary function in

addition to that caused by smoking.

Whether a particular miner’s disability

is due to his coal mine employment or

smoking habit must be resolved on a

claim-by-claim basis under the criteria

set forth at § 718.204.

Drs. Fino and Bahl find no scientific

support that clinically significant

emphysema exists in coal miners

without progressive massive fibrosis,

Rulemaking Record, Exhibit 89–37,

Appendix C at 31, but the available

pathologic evidence is to the contrary.

Cockcroft evaluated 39 coal workers and

48 non-coal worker controls dying of

cardiac causes in 1979. Cockcroft A,

Wagner JC, Ryder R, Seal RME, Lyons

JP, Andersson N, ‘‘Post-mortem study of

emphysema in coalworkers and noncoalworkers,’’ Lancet 2:600–603 (1982);

see also Criteria, § 4.2.2.2, Rulemaking

Record, Exhibit 2–1 at 52. Centrilobular

emphysema (the predominant type

observed) was significantly more

common among the coal workers. The

severity of the emphysema was related

to the amount of dust in the lungs.

These findings held even after

controlling for age and smoking habits.

Similarly, Leigh and colleagues

analyzed 886 miners who died between

1949 and 1982. Leigh J, Outhred KG,

McKenzie HI, Glick M, Wiles AN,

79942 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

‘‘Quantified pathology of emphysema,

pneumoconiosis and chronic bronchitis

in coal workers,’’ BR J Indust Med

40:258–263 (1983); see also Criteria,

§ 4.2.2.2, Rulemaking Record, Exhibit 2–

1 at 53. They found that miners with

more years of face work had worse

emphysema pathologically. In a

subsequent study of 264 underground

coal miners exposed to mixed coal and

silica dust, Leigh performed a multiple

regression analysis to assess the effects

of total lung coal content, total lung

silica content, smoking history, and

years at the coal face on pulmonary

function, extent of emphysema, and

extent of fibrosis. Leigh J, Driscoll TR,

Cole BD, Beck RW, Hull BP, Yang J,

‘‘Quantitative relation between

emphysema and lung mineral content in

coalworkers,’’ Occ Environ Med 51:400–

407 (1994); see also Criteria, § 4.2.2.2,

Rulemaking Record, Exhibit 2–1 at 53.

Multiple regression analysis is a

powerful statistical tool used to identify

which of a series of variables is

responsible for an observed correlation,

and to eliminate apparent correlations

that can be explained by other true

relationships. He made the following

important findings: (1) The extent of

emphysema was strongly related to the

total coal content of the lung, age and

smoking; (2) in miners who were

lifelong non-smokers, the extent of

emphysema was strongly related to coal

content and age; (3) the extent of

emphysema was unrelated to lung silica

content; and (4) the extent of lung

fibrosis was related to silica content.

The authors concluded that ‘‘these

results provide strong evidence that

emphysema in coalworkers is causally

related to lung coal content.’’ Leigh, Occ

Environ Med 51:400.

Ruckley and colleagues achieved

similar results in examining the lungs of

450 coal workers to determine the

association between coal mine dust

exposure and dust-related fibrosis and

emphysema. Ruckley VA, Gauld SJ,

Chapman JS, et al., ‘‘Emphysema and

dust exposure in a group of coal

workers,’’ Am Rev Resp Dis 129:528–

532 (1984); see also Criteria, § 4.2.2.2,

Rulemaking Record, Exhibit 2–1 at 53.

Emphysema was graded by standard

techniques, smoking histories were

obtained by questionnaire and

Pneumoconiosis Panel records, and lung

dust content was analyzed

pathologically. Relationships between

emphysema and possible explanatory

variables were tested by multiple

logistic regression models, which

exclude confounding variables in

analyzing causal effects. The authors

found emphysematous changes in 72%

of miners who smoked, 65% of exsmokers, and 42% of nonsmoking

miners; emphysema scores were higher

in patients with increasing evidence of

pneumoconiotic disease; and increasing

coal lung dust was associated with the

presence of emphysema. Forty-seven

percent of miners with no fibrotic

lesions had emphysema. Ruckley

concluded that ‘‘the results support the

conclusion that the relationship

observed between respirable dust and

emphysema in coal workers is, in some

way, causal.’’ Ruckley, Am Rev Resp Dis

129:532.

Drs. Fino and Bahl point to several

other sources in support of their view

that clinically significant emphysema is

not related to coal dust exposure in the

absence of PMF. They quote Morgan’s

textbook, Occupational Lung Diseases,

as saying that changes of focal

emphysema cannot be equated with

airways obstruction. The commenters

fail to note additional comments in the

same textbook:

The increased risk of centriacinar

emphysema in PMF cases away from the

lesion, and, in simple pneumoconiosis, in

relation to dust exposure supports the

hypothesis that coal dust exposure sufficient

to cause alveolar inflammation and fibrosis

also initiates centriacinar emphysema. This

seems a likely explanation for the consistent

epidemiologic finding of decrements in FEV1

and FVC and a rise in residual volume in

relation to the indices of dust exposure in

coal miners.

Seaton, Occupational Lung Diseases at

400–401. Morgan’s conclusions are also

somewhat suspect because he has

admitted that at least in commenting on

the Cockcroft paper, some of his

criticisms were inaccurate and not valid

or fair. Judgement of Mr. Justice Turner,

The British Coal Respiratory Disease

Litigation, Jan. 23, 1998, Rulemaking

Record, Exhibit 72. Dr. Fino and Bahl’s

citation to Snider, Snider GL,

‘‘Emphysema: the first two centuriesand beyond. A historical overview, with

suggestions for future reference,’’ Am

Rev Resp Dis 146:1333–1344 (Part 1)

and 146:1615–1622 (Part 2) (1992); see

also Rulemaking Record, Exhibit 89–37,

Appendix C at 34, is also unhelpful

because the articles contain no opinion

as to whether emphysema in coal

miners can be clinically significant or

affects pulmonary function. Coal dust

exposure was plainly not the focus of

these articles.

The Department’s proposed revision

to the definition of pneumoconiosis is

also supported by the growing evidence

of the adverse affects of coal mine dust

exposure at the cellular level leading to

obstructive lung disease. Criteria, 4.3,

Rulemaking Record, Exhibit 2–1 at 65–

69; see generally Coggon, Thorax

53:404. Alveolar macrophages are cells

that are normally situated in the alveoli,

or gas-exchange units of the lung. Their

normal function is to recognize foreign

substances, phagocytize (ingest) these

substances, and activate other

inflammatory cells. Coal dust, in turn,

causes leakage of destructive protease

and elastase enzymes from alveolar

macrophages. These enzymes can

destroy the network of elastin and

collagen proteins that comprise the

underlying support structure of the lung

architecture; the release of these

enzymes from inflammatory cells is thus

associated with the production of

emphysema. Lung lavage studies are

performed by washing an area of lung

with saline instilled through a fiberoptic

bronchoscope placed through a subject’s

throat and wedged into the lung. These

studies of nonsmoking coal miners with

simple CWP showed activation of

macrophages with evidence of ingestion

of dust particles, a finding not present

in normal controls. Takemura T, Rom

WM, Ferrans VJ, Crystal RG,

‘‘Morphologic characterization of

alveolar macrophages from subject with

occupational exposure to inorganic

particles,’’ Am Rev Resp Dis 140:1674–

1685 (1989); see also Criteria, § 4.3.3,

Rulemaking Record, Exhibit 2–1 at 69.

A subsequent lavage study of

nonsmoking coal miners found that the

macrophages spontaneously released

substances toxic to the lung, including

reactive oxygen species and elastase.

These substances were released in

significantly higher quantities in miners

than in non-mining smokers or in nonmining nonsmokers without lung

disease. Rom WN, ‘‘Basic mechanisms

leading to focal emphysema in coal

workers’’ pneumoconiosis,’’ Environ

Res 53:16–28 (1990); see also

Rulemaking Record, Exhibit 5–174,

Appendix 8. As noted, the reactive

oxygen species damage cell membranes,

cell proteins, and DNA. Over-secretion

of these substances may overwhelm the

lung’s natural defenses (such as antioxidants and anti-proteases). The

unopposed proteases and elastases can

destroy lung tissue, causing

emphysema.

Reactive oxygen substances have been

shown to damage anti-proteases in the

lung. Anti-proteases are enzymes that

protect the lung from proteases and

elastases that are released during an

inflammatory reaction (such as that

produced by inhalation of coal mine

dust). Without this protection, the

proteases and elastases can destroy the

elastin and collagen that comprise the

structure of the lung, resulting in

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79943

emphysematous changes. This was

demonstrated in an animal model of

coal dust inhalation, where the coal

dust was found to increase elastase

levels and cause degradation of alpha-1

antitrypsin (one of the protective

enzymes) in association with pathologic

findings of emphysema. In vitro studies

have also demonstrated that the

protective anti-protease activity of

alpha-1 antitrypsin is decreased by

exposure to coal dust. These

observations support the theory that

dust-induced emphysema and smokeinduced emphysema occur through

similar mechanisms—namely, the

excess release of destructive enzymes

from dust- (or smoke-) stimulated

inflammatory cells in association with a

decrease in protective enzymes in the

lung.

Animal and human studies have also

shown that coal mine dust inhalation

can recruit neutrophils, another

inflammatory cell, into the lung. Rom

WN (1990). Activated neutrophils

produce elastase as well as other

inflammatory mediators. The

recruitment of neutrophils and the

activation of alveolar macrophages is

greater in nonsmoking coal miners with

pulmonary impairment than either nonminers or nonsmoking miners without

pulmonary impairment. This suggests

that a combination of coal mine dust

exposure and host susceptibility may be

required to produce disease. Thus,

although many of the studies evaluating

mechanisms of pathogenesis of coal

mine dust exposure concentrate on the

development of fibrosis, there is

considerable basic scientific data

linking coal mine dust to the

development of obstructive airways

disease.

Moreover, cytokines, which are

chemical substances released from a

number of cells in the lung, have been

implicated in the development of lung

disease in coal miners. Criteria, § 4.3.1,

Rulemaking Record, Exhibit 2–1 at 65–

69. Tumor necrosis factor-α (TNF) and

Interleukin 6 (IL–6) are two of them.

TNF is released by alveolar

macrophages as well as other cells in

response to coal dusts (as well as other

mineral dusts). TNF stimulates lung

fibrosis. Patients with progressive CWP

have higher TNF release from lung

monocytes. TNF release is also

increased in coal miners with airflow

obstruction. TNF has been demonstrated

to be an important mediator in

obstructive airways diseases including

COPD and asthma. Alveolar

macrophages have been shown to

release IL–6 in response to exposure to

coal mine dust. Increased IL–6 levels

were noted in lungs of coal miners with

CWP. IL–6 has been implicated in the

creation of inflammatory changes of the

lower respiratory tract in chronic

bronchitis as well as reactive airways

disease. In addition, other cellular

mediators, including leukotriene B4,

thromboxane A2, prostaglandin E2, and

platelet activating factor, have been

shown to be produced by alveolar

macrophages or other pulmonary cells

in response to coal mine dust and are

well known to play a role in the

production of reactive airways disease.

Thus, there is considerable basic

scientific data linking coal dust to the

development of obstructive airways

disease.

One commenter repeatedly accuses

the Department of not supporting its

definitional change with ‘‘peerreviewed’’ scientific and medical

studies, but does not point to any study

or article in particular. The Department

rejects this assertion. Each of the articles

and studies cited above, as well as the

majority relied upon by NIOSH in the

Criteria document, appeared in a peerreviewed journal: American Review of

Respiratory Disease, American Journal

of Industrial Medicine, Thorax, Journal

of Occupational Medicine, Lancet,

British Journal of Industrial Medicine,

Occupational Environmental Medicine,

Environmental Research, and others.

The textbooks relied upon are authored

and edited by highly respected

professionals in the field. Textbook

editors serve as peer-reviewers of the

relevant published literature because

they comprehensively survey, evaluate

the validity of, and comment on, the

literature. Seaton’s review in Morgan

and Seaton’s Occupational Lung Disease

is a good example. Moreover, the

NIOSH Criteria document, Rulemaking

Record, Exhibit 2–1, received extensive

peer review prior to its publication. See

Criteria, Rulemaking Record, Exhibit 2–

1 at xxii–xxiv.

It bears repeating that in developing

its recommended dust exposure

standard, NIOSH carefully reviewed the

available evidence on lung disease in

coal miners. NIOSH also considered the

strength of the evidence, including the

sampling and statistical analysis

techniques used, Criteria, § 7.3.4,

Rulemaking Record, Exhibit 2–1 at 124,

and concluded that the science

provided a substantial basis for adopting

a permissible dust exposure limit.

NIOSH summarized its findings based

on some of the studies detailed above,

along with others, as follows:

In addition to the risk of simple CWP and

PMF, epidemiological studies have shown

that coal miners have an increased risk of

developing COPD. COPD may be detected

from decrements in certain measures of lung

function, especially FEV1 and the ratio of

FEV1/FVC. Decrements in lung function

associated with exposure to coal mine dust

are severe enough to be disabling in some

miners, whether or not pneumoconiosis is

also present. A severe or disabling decrement

in lung function is defined here as an FEV1

<65% of expected normal values; an

impairment in lung function is defined as an

FEV1 <80% of predicted normal values. An

exposure-response relationship between

respirable coal mine dust exposure and

decrements in lung function has been

observed in cross-sectional studies and

confirmed in longitudinal studies.

Criteria, 4.2.3.2 (citations omitted),

Rulemaking Record, Exhibit 2–1 at 57.

That coal mine dust exposure can cause

obstructive lung disease is now a welldocumented fact.

Finally, the Department’s position is

consistent with the growing body of

case law recognizing that obstructive

lung diseases can arise from coal mine

dust exposure. See generally Labelle

Processing Co. v. Swarrow, 72 F.3d 308,

315 (3d Cir. 1995) (‘‘Chronic bronchitis,

as a chronic pulmonary disease, falls

within the legal definition of

pneumoconiosis.’’); Kline v. Director,

OWCP, 877 F.2d 1175, 1178 (3d Cir.

1989) (The legal definition of

pneumoconiosis ‘‘encompasses a wider

range of afflictions than does the more

restrictive medical definition of coal

workers’ pneumoconiosis.’’);

Richardson v. Director, OWCP, 94 F.3d

164, 166 n.2 (4th Cir. 1996) (‘‘COPD, if

it arises out of coal-mine employment,

clearly is encompassed within the legal

definition of pneumoconiosis, even

though it is a disease apart from clinical

pneumoconiosis.’’); Warth v. Southern

Ohio Coal Co., 60 F.3d 173, 175 (4th Cir.

1995) (‘‘Chronic obstructive lung

disease * * * is encompassed within

the definition of pneumoconiosis for

purposes of entitlement to Black Lung

benefits.’’); Barber v. Director, OWCP, 43

F.3d 899, 901 (4th Cir. 1995)

(‘‘physicians generally use

‘pneumoconiosis’ as a medical term that

comprises merely a small subset of the

afflictions compensable under the Act’’);

Bethlehem Mines Corp. v. Massey, 736

F.2d 120, 124 (4th Cir. 1984)

(recognizing that emphysema can be

aggravated by coal dust exposure);

Peabody Coal Co. v. Holskey, 888 F.2d

440, 442 (6th Cir. 1989) (substantial

evidence supported ALJ’s decision to

credit doctor who believed miner’s

chronic obstructive pulmonary disease

was related to coal dust exposure over

doctor who believed the disease was

caused solely by cigarette smoking);

Campbell v. Consolidation Coal Co., 811

F.2d 302, 304 (6th Cir. 1987) (where

miner had obstructive lung disease and

no evidence demonstrated it was not

79944 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

related to coal mine employment,

employer failed to rebut interim

presumption of entitlement); Freeman

United Coal Mining Co. v. OWCP, 957

F.2d 302, 303 (7th Cir. 1992)

(recognizing that the Act’s definition of

pneumoconiosis encompasses

obstructive disease caused in whole or

in part by exposure to coal dust); Old

Ben Coal Co. v. Prewitt, 755 F.2d 588,

591 (7th Cir. 1985) (recognizing that

chronic obstructive pulmonary disease

‘‘fits the statutory definition’’ of

pneumoconiosis); Associated Elec.

Coop., Inc. v. Hudson, 73 F.3d 845, 847

(8th Cir. 1996) (affirming award of

benefits based on medical evidence of

‘‘severe obstructive lung disease caused

by coal dust exposure’’); Consolidation

Coal Co. v. Hage, 908 F.2d 393, 395 (8th

Cir. 1990) (chronic obstructive lung

disease ‘‘constitutes a type of ailment

which Congress deems sufficient to

entitle a claimant to Black Lung

benefits’’); Bradberry v. Director, OWCP,

117 F.3d 1361, 1368 (11th Cir. 1997)

(‘‘COPD that arises from coal-mine

employment falls within the legal

definition of pneumoconiosis.’’);

Stomps v. Director, OWCP, 816 F.2d

1533, 1536 (11th Cir. 1987) (ordering

award of benefits on strength of medical

opinion that miner’s totally disabling

chronic obstructive pulmonary disease

was caused in part by coal mine

employment).

Contrary to the commenters’

argument, then, the record does contain

overwhelming scientific and medical

evidence demonstrating that coal mine

dust exposure can cause obstructive

lung disease. The Department therefore

declines to change the definition of

pneumoconiosis as proposed.

(g) One comment suggests that the

Department delete the term

‘‘anthracosis’’ from the definition of

pneumoconiosis, contending that it is a

term commonly used to denote

anthracotic pigmentation, without

associated disease process, on biopsy or

autopsy of the lungs. The Department

has accommodated this concern in the

proposed revisions to § 718.202(a)(2).

The revised version of § 718.202(a)(2)

explicitly provides that ‘‘[a] finding in

an autopsy or biopsy of anthracotic

pigmentation * * * shall not be

sufficient, by itself, to establish the

existence of pneumoconiosis.’’ 64 FR

55013 (Oct. 8, 1999). Thus, the

Department does not believe that a

change to the definition of

pneumoconiosis is necessary.

(h) Several comments suggest that the

Department appoint an expert panel to

review the scientific and medical

evidence on the obstructive disease,

latency and progressivity proposed

revisions to the regulation. The

Department declines to follow this

suggestion. As set forth above, the

relevant scientific and medical

information available on these topics

has been thoroughly reviewed by

highly-qualified experts, including

NIOSH, the advisor designated by

Congress to consult with the

Department in developing criteria for

total disability due to pneumoconiosis

under the Black Lung Benefits Act. 30

U.S.C. 902(f)(1)(D). Accordingly, to the

extent these commenters note that

‘‘since coal-workers’’ pneumoconiosis is

a medical condition, * * * this

determination [establishing a proper

definition of pneumoconiosis] should be

left to the medical experts,’’ the

comment ignores both the statutory

definition of pneumoconiosis and the

large body of scientific evidence already

reviewed by medical experts, as

outlined above.

(i) One comment criticizes the

Department for not considering two

major sources of information regarding

U.S. coal miners: the National Coal

Study, which the commenter states has

provided a wealth of longitudinal

information about the health of miners,

and the NIOSH X-ray Surveillance

Program. The commenter is incorrect.

The information from both of these

programs is a major focus of NIOSH’s

Criteria document, Rulemaking Record,

Exhibit 2–1, and is further analyzed in

many of the articles considered by the

Department and NIOSH in proposing

the revisions.

(j) One comment generally objects to

the proposed revisions and urges the

Department to collect data developed by

the Universities of Kentucky and

Louisville since the 1996

comprehensive reform of the Kentucky

state workers’ compensation law, a

program the commenter states is based

on objective medical findings of

‘‘certified B readers.’’ The commenter

believes that this data would more

accurately reflect modern day dust

control in coal mining than the studies

relied upon by the Department. As

discussed above, the Department’s

conclusions are fully supported by the

ample data it has already reviewed,

including data generated from time

periods post-dating implementation of

federally-mandated dust control

measures. Moreover, the Department

does not believe this information would

be particularly relevant to the proposed

revisions of the definition of

pneumoconiosis. A ‘‘certified B reader’’

is a physician proved by examination to

be proficient in assessing the quality of

chest X-rays and in using the ILO–U/C

system to classify X-rays for

pneumoconiosis. 20 CFR

718.202(a)(1)(ii)(E) (1999). While this

information may show the incidence of

clinical pneumoconiosis in a given

population of coal miners, it is not

particularly relevant to the other subset

of diseases compensable under the

Black Lung Benefits Act, namely, any

chronic lung disease arising out of coal

mine employment.

(k) Another comment implies that the

proposed definitional changes adopt

arbitrary medical ‘‘presumptions’’

without consultation with any

pulmonary experts. As discussed above,

all of the scientific and medical

evidence upon which the Department

relies has been thoroughly reviewed and

evaluated by experts in the field. It is

not the Department’s intent to create a

‘‘presumption’’ with the proposed

revisions to the definition. Instead, the

revisions are designed to define

pneumoconiosis in accordance with the

best science currently available to the

Department while leaving with the

miner the burden of persuading the

factfinder that he has a lung disease

falling within this definition.

(l) Two comments note that the

proposed definition (at least insofar as

it recognizes that both obstructive and

restrictive lung disease may be caused

by exposure to coal mine dust) was

rejected by Congress and should not be

adopted. The Department has already

responded to this criticism. 64 FR 54972

(Oct. 8, 1999). No further discussion is

necessary.

(m) Two comments, while supporting

the proposed changes, ask the

Department to amend the regulation

further by requiring factfinders to

categorically reject as non-conforming

any physician’s opinion stating either

that coal dust cannot cause, or causes

only trivial, obstructive lung

impairments, or that coal dust-induced

lung diseases cannot manifest

themselves after a miner’s exposure to

coal mine dust ceases. The commenters

state that such a change would forestall

parties opposing miners’ entitlement

from needlessly prolonging litigation. A

physician’s opinion based on a premise

fundamentally at odds with the statute

and regulations is flawed, and the

factfinder must weigh that physician’s

opinion accordingly. See, e.g., Robinson

v. Missouri Mining Co., 955 F.2d 1181,

1183 (8th Cir. 1992); Penn Allegheny

Coal Co. v. Mercatell, 878 F.2d 106,

109–110 (3d Cir. 1989). This principle

will continue to govern under the

revised regulation. Thus, the

Department does not believe a change to

the proposed regulation is necessary.

(n) Several comments support the

proposal, noting that the revisions to the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79945

definition of pneumoconiosis are

supported by the current state of

medical knowledge.

(o) Two comments urge the

Department to join the lawsuit filed by

the Department of Justice to recover

money from the tobacco industry for

costs incurred by the black lung

program for compensating and treating

smoking-related disabilities. The

comment is not directed to any

regulatory proposal, and no response is

warranted.

(p) No other comments were received

concerning this section, and no further

changes have been made in it.

20 CFR 718.202

(a) In the initial notice of proposed

rulemaking, the Department proposed

changing § 718.202 only to the extent of

clarifying that a diagnosis of anthracotic

pigment by biopsy, standing alone, is

not equivalent to a diagnosis of

pneumoconiosis. Former § 718.202(a)(2)

imposed this limitation with respect to

autopsy evidence only, and the

Department noted there was no reason

to treat the two types of evidence

differently. 62 FR 3345, 3376 (Jan. 22,

1997). The Department did not propose

any further changes to § 718.202 in the

second notice of proposed rulemaking,

although the regulation remained open

for comment. 64 FR 54971 (Oct. 8,

1999).

(b) One comment supports the

Department’s proposed change as

consistent with mainstream scientific

findings. Several other comments

support this change, but also advocate

adopting the criteria for diagnosing

pneumoconiosis by autopsy or biopsy

developed by the American College of

Pathologists and Public Health Service.

For the reasons set out in the preamble

to § 718.106, the Department cannot

make this change.

(c) Two comments urge the inclusion

of language stating that a negative chest

x-ray cannot form the basis of a

physician’s reasoned finding of no

pneumoconiosis as the disease is

defined in the statute and regulations.

The suggested addition is unnecessary

for several reasons. The Black Lung

Benefits Act already prohibits the denial

of a claim solely on the basis of a

negative x-ray. 30 U.S.C. 923(b). A

physician’s opinion ruling out the

presence of the disease based solely on

a negative x-ray would be similarly

insufficient; such an opinion would

amount to no more than a repetition of

the x-ray findings. See Worhach v.

Director, OWCP, 17 Black Lung Rep. 1–

105, 1–110 (1993) (physician’s opinion

which merely restates x-ray findings is

not a diagnosis of pneumoconiosis for

purposes of § 718.202(a)(4)).

Furthermore, § 718.202(a)(4) already

recognizes that a diagnosis of

pneumoconiosis may be made based on

a documented and reasoned medical

opinion despite a negative x-ray. Warth

v. Southern Ohio Coal Co., 60 F.3d 173,

174–75 n.* (4th Cir. 1995) (holding

physician’s opinion that

pneumoconiosis cannot be diagnosed

absent positive x-ray or tissue samples

conflicts with § 718.202(a)(4) because

physician’s diagnosis may be based on

other clinical evidence notwithstanding

negative x-ray). Finally, only a

physician can determine the diagnostic

value of a negative x-ray in assessing the

presence or absence of a respiratory or

pulmonary disease in a particular

miner. The law only prohibits making

the negative x-ray the sole and

conclusive basis for ruling out the

disease.

(d) One comment would limit

relevant radiological qualifications to

board-certification in radiology and

certification as a B-reader. Although

these two qualifications may encompass

most physicians’ expert training, a rigid

rule prohibiting consideration of any

other aspect of a physician’s background

is undesirable. The adjudicator should

consider any relevant factor in assessing

a physician’s credibility, and each party

may prove or refute the relevance of that

factor. See Worhach v. Director, OWCP,

17 Black Lung Rep. 1–105, 1–108 (1993)

(holding adjudicator may properly

consider physician’s professorship in

radiology in weighing radiological

qualifications under § 718.202(a)(1));

compare Melnick v. Consolidation Coal

Co., 16 Black Lung Rep. 1–31, 1–37

(1991) (en banc) (holding adjudicator

may not consider physician’s

‘‘prestigious teaching position’’ outside

the field of radiology under

§ 718.202(a)(1) in assessing physician’s

radiological competence).

(e)(i) Three comments favor language

recognizing that CT scans are not

reliable diagnostic tools for evaluating

the presence or absence of

pneumoconiosis because no

standardized criteria exist for

interpreting them. Another comment,

however, argues that a negative CT scan

effectively precludes a diagnosis of

pneumoconiosis because of its level of

clinical sophistication. General language

accepting or rejecting the use of CT

scans is not necessary. The Department

did not propose any such language, or

develop the record to ascertain the

medical community’s views. The

comments take diametrically opposite

views on the use of these tests, which

provides no basis for adopting either

view. Furthermore, the Department

favors consideration of new and more

accurate diagnostic technologies as they

become available in the future. See

preamble to § 718.107, 62 FR 3343 (Jan.

22, 1997). Any party may support or

challenge the probative value of a

particular test with expert opinions. No

useful purpose would therefore be

served by adopting a blanket exclusion

of any particular type of testing. (ii)

Based on the alleged unreliability of CT

scans, two comments urge the

Department to make clear that a

claimant may refuse to undergo a CT

scan without prejudicing the

adjudication of his or her claim. The

Department rejects this position. The

adjudicator should determine whether a

claimant’s refusal to undergo a CT scan

(or any other medical test) is reasonable

in light of all relevant circumstances in

the particular case. A general

exoneration for all claimants refusing

CT scans is not warranted, especially

since the Department does not endorse

the commenters’ premise that this

technology is necessarily unreliable in

the absence of standardized criteria for

interpreting it. (iii) One comment

contends the CT scan is sufficiently

reliable that a negative result effectively

rules out the existence of

pneumoconiosis. The statutory

definition of ‘‘pneumoconiosis,’’

however, encompasses a broader

spectrum of diseases than those

pathologic conditions which can be

detected by clinical diagnostic tests

such as x-rays or CT scans. See generally

Island Creek Coal Co. v. Compton, F.3d,

No. 98–2051, 2000 WL 524798, *4 (4th

Cir. May 2, 2000) (reviewing medical

and legal definitions of

‘‘pneumoconiosis,’’ the latter of which

is broader). For purposes of the Black

Lung Benefits Act, ‘‘pneumoconiosis’’

includes any ‘‘chronic dust disease of

the lung and its sequelae, including

respiratory and pulmonary

impairments, arising out of coal mine

employment.’’ 30 U.S.C. 902(b). A CT

scan may provide reliable evidence in a

particular claim that the miner does not

have any evidence of the disease which

can be detected by that particular

diagnostic technique. The record,

however, does not contain any medical

evidence demonstrating the capacity of

CT scans to rule out the existence of all

diseases ‘‘arising out of coal mine

employment.’’ See Compton, F.3d, 2000

WL 524798, *4 (noting that a medical

diagnosis of no pneumoconiosis is not

equivalent to a diagnosis of no legal

pneumoconiosis), citing Hobbs v.

Clinchfield Coal Co., 45 F.3d 819, 821

(4th Cir. 1995). The Department

therefore cannot accept the commenter’s

79946 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

position that a negative CT scan is selfsufficient evidence that the miner does

not have ‘‘pneumoconiosis’’ for

purposes of the statute.

(e) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 718.204

(a)(i) The Department proposed

several significant changes to § 718.204

in the initial notice of proposed

rulemaking. 62 FR 3344–45, 3377–78

(Jan. 22, 1997). One revision clarified

that ‘‘total disability’’ does not take into

consideration any disabling nonrespiratory conditions, i.e., a miner may

be totally disabled for purposes of the

Black Lung Benefits Act (BLBA)

notwithstanding the existence of any

independently disabling nonrespiratory/pulmonary impairments.

This change emphasized the

Department’s disagreement with

Peabody Coal Co. v. Vigna, 22 F.3d 1388

(7th Cir. 1994) (holding claimant’s

entitlement precluded by disabling

stroke which was unrelated to coal mine

employment and occurred before

evidence of disability due to

pneumoconiosis); contra Youghiogheny

& Ohio Coal Co. v. McAngues, 996 F.2d

130 (6th Cir. 1993), cert. den. 510 U.S.

1040 (1994) (holding miner’s disabling

injuries from automobile accident

irrelevant to disability determination

under BLBA). Another revision codified

holdings in two circuits that

‘‘disability’’ for purposes of the BLBA is

a totally disabling respiratory or

pulmonary impairment, and not ‘‘whole

person’’ disability. The Department also

proposed a definition for ‘‘disability

causation’’ to harmonize the various

formulations of that standard in circuit

court decisions: a miner is totally

disabled ‘‘due to pneumoconiosis’’ if the

disease is a ‘‘substantially contributing

cause’’ of the miner’s disability.

Similarly, the Department proposed

recognizing that pneumoconiosis may

worsen a totally disabling respiratory or

pulmonary impairment which is itself

unrelated to coal mine employment.

Finally, the Department proposed a

number of editorial changes to § 718.204

to rationalize its structure. 62 FR 3344–

45 (Jan. 22, 1997). (ii) In the second

notice of proposed rulemaking, the

Department proposed a minor revision

to § 718.204(b)(2)(iv) by restoring

language from 20 CFR 718.204(c)(4)

(1999), which had been omitted

inadvertently. The language set forth the

circumstances under which a medical

report may establish the miner’s total

disability. 64 FR 54979, 55014 (Oct. 8,

1999). The Department also responded

to numerous comments it had received

concerning the proposed regulation. 64

FR 54979–80 (Oct. 8, 1999). Several

comments expressed both support for,

and opposition to, the Department’s

rejection of Vigna’s holding that a preexisting totally disabling impairment

which is unrelated to coal mine

employment precludes entitlement

under the BLBA. The Department

concluded the commenters had

provided no reason for changing the

proposed regulation. The Department

also rejected comments which

recommended adopting a ‘‘whole

person’’ standard for total disability,

rather than the proposed definition

limiting disability to pulmonary and

respiratory impairments. The

commenters offered no rationale in

support of the requested change other

than a statutory interpretation of ‘‘total

disability’’ previously rejected by two

circuit courts in favor of the

Department’s position. With respect to

‘‘disability causation,’’ the Department

rejected: challenges to its authority to

define ‘‘disability due to

pneumoconiosis’’ given the statute’s

broad grant of rulemaking authority and

the ambiguity in the statutory term;

various alternative formulations of the

disability causation standard in place of

‘‘substantially contributing cause’’

inasmuch as the Department’s definition

reflected a general consensus in the

existing caselaw; and arguments that the

‘‘substantially contributing cause’’

standard permitted awards based solely

on smoking-related disability because

such awards are contrary to both the

BLBA and judicial precedent. Other

than the restoration of language to

§ 718.204(b)(2)(iv), the Department did

not propose any additional changes to

§ 718.204. 64 FR 54979–80 (Oct. 8,

1999).

(b) In both the first and second notices

of proposed rulemaking, the Department

proposed identical language defining

total disability due to pneumoconiosis.

62 FR 3345, 3377; 64 FR 54979–54980,

55014. The Department explained its

authority to define this statutory

element of entitlement and proposed

using a substantially contributing cause

standard. Thus, a miner would be found

totally disabled due to pneumoconiosis

if he establishes that his

pneumoconiosis is a substantially

contributing cause of his totally

disabling respiratory or pulmonary

impairment. In both proposals, the

Department explained that this standard

was based on court of appeals precedent

which had developed since 1989 and

varied very little from circuit to circuit.

The Department also proposed that

pneumoconiosis be considered a

substantially contributing cause of the

miner’s disability if it either has an

adverse effect on the miner’s respiratory

or pulmonary condition or worsens a

totally disabling respiratory or

pulmonary impairment caused by a

disease or exposure unrelated to coal

mine employment. §§ 718.204(c)(1)(i),

718.204(c)(1)(ii). In neither proposal did

the Department describe the extent to

which pneumoconiosis must have

produced an adverse effect or worsened

a totally disabling respiratory

impairment. The Department did not

mean to alter the current law through its

proposals, however, or to suggest that

any adverse effect, no matter how

limited, was sufficient to establish total

disability due to pneumoconiosis.

Rather, the Department meant only to

codify the numerous decisions of the

courts of appeals which, in the process

of deciding when a miner is totally

disabled due to pneumoconiosis, have

also ruled on what evidence is legally

sufficient to establish that element of

entitlement. In order to clarify this

consistent intent, the Department has

added the word ‘‘material’’ to

§ 718.204(c)(1)(i) and ‘‘materially’’ to

§ 718.204(c)(1)(ii). In so doing, the

Department intends merely to

implement the holdings of the courts of

appeals. Thus, evidence that

pneumoconiosis makes only a

negligible, inconsequential, or

insignificant contribution to the miner’s

total disability is insufficient to

establish that pneumoconiosis is a

substantially contributing cause of that

disability.

The Department is also mindful,

however, that Congress enacted the Act

in large part to permit benefit awards to

miners whose entitlement under state

workers’ compensation laws was

precluded by burdensome causation

requirements. Adams v. Director,

OWCP, 886 F.2d 818, 825 (6th Cir.

1989); Mangus v. Director, OWCP, 882

F.2d 1527, 1530–1531 (10th Cir. 1989).

Moreover, the courts have also

recognized the difficulties that would

confront a miner who must prove the

relative amounts that various causal

elements contribute to his totally

disabling respiratory or pulmonary

impairment. See Compton v. Inland

Steel Coal Co., 933 F.2d 477, 481–483

(7th Cir. 1991); Adams, 886 F.2d at 825;

Mangus, 882 F.2d at 1530–1531. The

courts have held that a claim will not be

denied simply because a physician

reasonably may be unwilling or unable

to account, as a percentage or otherwise,

for the exact degree of impairment

caused by pneumoconiosis. See, e.g.,

Barger v. Abston Constr. Co., 196 F.3d

1261 (11th Cir. 1999) (Table) (opinion

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79947

that pneumoconiosis was ‘‘at least a

partial contributing cause’’ of miner’s

disability sufficient to prove disability

due to pneumoconiosis); Cross

Mountain Coal Co. v. Ward, 93 F.3d

211, 218 (6th Cir. 1996) (opinion that

miner’s ‘‘impairment is due to his

combined dust exposure, coal workers’’

pneumoconiosis as well as his cigarette

smoking history’’ sufficient); Benjamin

Coal Co. v. McMasters, 27 F.3d 555 (3d

Cir. 1994) (Table) (opinions that (1)

pneumoconiosis was the ‘‘least

significant’’ factor contributing to

miner’s disability, and (2) coal dust

exposure and cigarette smoking

contributed to miner’s impairment but

doctor was unable ‘‘to differentiate

between the effects of the two causes’’

sufficient); Compton v. Inland Steel

Coal Co., 933 F.2d 477, 479 (7th Cir.

1991) (opinion that ‘‘pneumoconiosis

* * * was one of the conditions that

brought about the pulmonary

impairment’’ sufficient); Robinson v.

Pickands Mather & Co., 914 F.2d 35, 36

(4th Cir. 1990) (opinion that miner’s

‘‘disability was consistent with

occupational pneumoconiosis’’

sufficient); Lollar v. Alabama ByProducts Corp., 893 F.2d 1258, 1267

(11th Cir. 1989) (physician’s diagnosis

of ‘‘restrictive pulmonary functions and

pleural disease by chest x-ray with

minimal parenchymal disease, all of

which is consistent with coal workers’

pneumoconiosis,’’ sufficient); Adams v.

Director, OWCP, 886 F.2d 818, 826 (6th

Cir. 1989) (diagnosis of ‘‘total disability

resulting from a combination of

pneumoconiosis, emphysema and

chronic obstructive lung disease’’

sufficient); Bonessa v. United States

Steel Corp., 884 F.2d 726 (3d Cir. 1989)

(opinion that pneumoconiosis made a

‘‘substantial contribution’’ to miner’s

disability sufficient); Mangus v.

Director, OWCP, 882 F.2d 1527 (10th

Cir. 1989) (evidence that miner’s

pneumoconiosis caused complications

requiring removal of entire lung during

surgery intended to remove only part of

lung as treatment of lung cancer,

sufficient).

(c)(i) One comment states the

Department has not justified its revision

of § 718.204(a) making disabling nonpulmonary/respiratory impairments

irrelevant in determining whether a

miner is totally disabled under the

BLBA. The Department has previously

addressed this issue in both the initial

and second notices of proposed

rulemaking. 62 FR 3344–45 (Jan. 22,

1997); 64 FR 54979 (Oct. 8, 1999). In

both instances, the Department cited

McAngues, 996 F.2d 130, as authority

for its view that non-pulmonary/

respiratory impairments cannot be

considered in a disability

determination. McAngues, 996 F.2d at

134–35, quotes with approval the

following language from Twin Pines

Coal Co. v. U.S. Dept. of Labor, 854 F.2d

1212 (10th Cir. 1988):

* * * [A] review of the cases, the statute,

its legislative history, and its interpretation

by the benefits review board * * * shows

that the statute is intended to confer special

benefits on miners who are disabled due to

pneumoconiosis whether or not they are

disabled from a different cause. Even when

other causes are themselves independently

disabling ‘[t]he concurrence of two sufficient

disabling medical causes one within the

ambit of the Act, and the other not, will in

no way prevent a miner from claiming

benefits under the Act.’

854 F.2d at 1215, quoting Peabody

Coal Co. v. Director, OWCP [Huber], 778

F.2d 358, 363 (7th Cir. 1985); see also

Cross Mountain Coal Co. v. Ward, 93

F.3d 211, 217 (6th Cir. 1996). This line

of authority from three federal courts of

appeals fully supports the Department’s

revision of § 718.204(a). Although Vigna

adopts a contrary interpretation of the

BLBA, the Seventh Circuit did not

address its own precedent in Huber or

the contrary decisions in McAngues and

Twin Pines. Accordingly, the

Department does not consider Vigna a

sufficient basis for altering the

regulation. (ii) Several comments

support the Department’s position.

(d) One comment contends the

limitations on introducing evidence

concerning non-respiratory or

pulmonary impairments deprive the

‘‘but for’’ disability causation standard

of any practical meaning in terms of

proving that pneumoconiosis played

little, if any, role in the miner’s

disability. The Department disagrees

with the commenter’s position for two

reasons. First, the Department has

adopted a ‘‘substantially contributing

cause’’ standard, which is not the

equivalent of a ‘‘but for’’ standard.

‘‘Substantially contributing cause’’

means pneumoconiosis has a material

adverse effect on a miner’s respiratory

or pulmonary condition

(§ 718.204(c)(1)(i)). This standard is less

rigorous than a ‘‘but for’’ test. Second,

only respiratory and pulmonary

impairments are relevant to determining

whether the miner is totally disabled for

purposes of the Black Lung Benefits Act,

and identifying the causes of that

disability. The commenter’s position

effectively rests on the Seventh Circuit’s

interpretation of disability causation in

Peabody Coal Co. v. Vigna, 22 F.3d 1388

(7th Cir. 1994). In that decision, the

Court held a miner’s entitlement to

benefits was precluded by his disabling

stroke because the stroke was unrelated

to coal mine employment and occurred

before any evidence the miner was

disabled by pneumoconiosis. The

Department disagrees with Vigna. Nonrespiratory or pulmonary disabilities

may co-exist with total disability due to

pneumoconiosis, but the former are

irrelevant for purposes of determining

whether a miner is entitled to black lung

benefits. Consequently, non-respiratory

or pulmonary impairments have no

relevance to the disability causation

standard, and the limitation on

introducing evidence concerning such

conditions is appropriate.

(e) Three comments oppose the

revised definition of ‘‘total disability’’ to

the extent it requires proof of a totally

disabling respiratory or pulmonary

impairment. The commenters urge the

Department to adopt a definition which

incorporates a ‘‘whole person’’

definition of disability, i.e., total

disability based on a combination of

pneumoconiosis and any other physical

impairments which prevent the miner

from performing his or her usual coal

mine work or comparable and gainful

work. The Department has previously

rejected the ‘‘whole person’’ standard in

both the initial and second notices of

proposed rulemaking. 62 FR 3345 (Jan.

22, 1997); 64 FR 54979 (Oct. 8, 1999).

The Department has consistently taken

the position that proof of a totally

disabling respiratory or pulmonary

impairment is an essential element of a

miner’s claim for black lung benefits.

See, e.g., Beatty v. Danri Corp. &

Triangle Enter., 49 F.3d 993, 1001 (3d

Cir. 1995); Jewell Smokeless Coal Corp.

v. Street, 42 F.3d 241, 243 (4th Cir.

1994); Lollar v. Alabama By-Products

Corp., 893 F.2d 1258, 1262–1263 (11th

Cir. 1990); Bosco v. Twin Pines Coal Co.,

892 F.2d 1473, 1480 (10th Cir. 1989);

Adams v. Director, OWCP, 886 F.2d 818,

820 (6th Cir. 1989). Adoption of a

‘‘whole person’’ definition of total

disability would greatly expand the

black lung benefits program and

transform it into a general disability

program for coal miners. The

Department is convinced such a result

has never been the intent of Congress.

Moreover, unlike the Social Security

Administration which has regulations,

procedures, and personnel devoted to

the evaluation of impairments from the

‘‘whole person’’ perspective, the

Department simply is not equipped to

evaluate such impairments. The

Department’s approach to the definition

of total disability is not undermined by

the allowance of survivors’ claims

where death was due in part to

nonrespiratory or nonpulmonary

79948 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

conditions but was actually hastened by

pneumoconiosis.

Allowance of survivors’ claims in

such situations is consistent with the

legislative history of the 1981

amendments to the BLBA. 62 FR 3345

(Jan. 22, 1997); 48 FR 24276–77 (May

31, 1983), In addition, the determination

of whether pneumoconiosis actually

hastened death in a given case does not

require the types of regulations,

procedures and personnel that would be

required by a ‘‘whole person’’ disability

definition.

(f) One comment opposes the

requirement in § 718.204(b)(2)(iv) that a

physician’s opinion must be

documented as well as reasoned in

order to establish the existence of a

totally disabling respiratory or

pulmonary impairment. The commenter

states that an opinion should be

considered sufficient if it is ‘‘reasoned.’’

The commenter also criticizes the

regulation for failing to define the

requisite documentation. The

commenter does not state a basis for

changing the regulation. The most

fundamental requirement for any

physician’s opinion is that it identify

the information and data upon which

the physician relies in order to form a

judgment about the miner’s pulmonary

condition. Unless the adjudicator is

aware of the documentation, (s)he is in

no position to determine whether the

opinion is ‘‘reasoned.’’ A physician

provides a ‘‘reasoned’’ opinion by

explaining conclusions in light of

factual premises which consist of

personal and occupational information

about the miner and the results of

clinical tests and a physical

examination, i.e., the ‘‘documentation.’’

See generally Director, OWCP v. Rowe,

710 F.2d 251, 255 (6th Cir. 1983). If one

or more of the premises is faulty or

inconsistent with the conclusions

reached by the physician, the

adjudicator may find the opinion not

credible. Contrary to the commenter’s

position, a physician’s reasoning cannot

be divorced from the underlying

documentation. As for defining the

necessary documentation, § 718.104(a)

sets forth the basic requirements for any

report of physical examination obtained

in connection with a claim for black

lung benefits, and subsection (b)

accommodates any additional testing

the physician may consider useful.

(g) One comment challenges the

Department’s authority to promulgate a

disability causation standard. The

commenter also contends the

Department cannot adopt a causation

standard which permits a finding of

total disability due to pneumoconiosis if

the miner’s pneumoconiosis worsens a

totally disabling respiratory or

pulmonary impairment which is itself

unrelated to coal mine employment.

§ 718.204(c)(1)(ii). The Department

rejects both positions. The Department

has previously addressed comments

contesting its authority to issue a

regulation defining disability causation

in the second notice of proposed

rulemaking. 64 FR 54979–80 (Oct. 8,

1999). The Department cited the explicit

rulemaking authority conferred by

Congress in 30 U.S.C. 902(f)(1), which

makes ‘‘total disability’’ subject to the

meaning established by the Department

through regulations. The Department

also noted that benefits may be paid for

total disability ‘‘due to

pneumoconiosis,’’ 30 U.S.C. 922(a)(1),

but that ‘‘due to’’ is ambiguous and

therefore a valid subject for regulatory

interpretation. With respect to the

‘‘worsening’’ standard, the Department

adopted this definition in response to

the Fourth Circuit’s decision in Dehue

Coal Co. v. Ballard, 65 F.3d 1189 (4th

Cir. 1995). In that decision, the Court

held that a miner who had totallydisabling lung cancer was not entitled to

benefits because his pneumoconiosis, by

definition, could not contribute to his

disability. The Department believes a

miner should not be denied benefits if

the miner’s pneumoconiosis causes

further deterioration of a totally

disabling (non-occupationally related)

pulmonary or respiratory impairment.

Although the effect is cumulative or

additive, the pneumoconiosis

nevertheless further diminishes the

miner’s already-compromised lung

function. The Department stresses that

this causation standard does not require

an award of benefits simply because the

miner has pneumoconiosis and the

pneumoconiosis adversely affects his or

her pulmonary condition. No award is

permitted if there is not also present a

totally disabling respiratory or

pulmonary impairment. In such a case,

the miner is entitled to benefits because

(s)he is totally disabled and

pneumoconiosis is a part of the overall

disabling condition.

(h) Three comments contend

generally that the disability causation

standard promotes awards for smokinginduced disability. The Department has

previously considered, and rejected, the

same contention in the second notice of

proposed rulemaking. 64 FR 54980 (Oct.

8, 1999). The BLBA, judicial precedent,

and the program regulations do not

permit an award based solely on

smoking-induced disability. Because the

commenters do not state any additional

grounds for their contention, no further

response is necessary.

(i) One comment suggests the role of

smoking in causing disability

undermines the regulatory

presumptions by negating the validity of

their factual premises. Specifically, the

commenter argues that the rational

connection between established and

presumed facts is broken if the miner

smoked. The Department disagrees with

this analysis. The presumptions

contained in §§ 718.302–718.306 are all

derived from the BLBA. See 30 U.S.C.

921(c)(1) [implemented by § 718.302];

921(c)(2) [implemented by § 718.303];

921(c)(3) [implemented by § 718.304];

921(c)(4) [implemented by § 718.305];

921(c)(5) [implemented by § 718.306].

The regulatory presumptions are

therefore authorized by the statute itself.

The Supreme Court has upheld the

constitutionality of 30 U.S.C. 921(c)(1)–

(4) in Usery v. Turner Elkhorn Mining

Co., 428 U.S. 1, 22–31 (1976). In the

1981 amendments to the BLBA,

Congress limited the applicability of 30

U.S.C. 921(c)(2) and (4) to claims filed

before January 1, 1982, and 921(c)(5) to

claims filed before June 30, 1982.

Consequently, three of the statutory

presumptions have little effect on the

adjudication of black lung claims at this

time. The Department also does not

accept the commenter’s premise that

allegedly widespread cigarette smoking

among miners has effectively destroyed

the basis for the presumptions. If any

individual miner’s smoking is proven

the sole cause of his or her disability,

death or disease, the party opposing

entitlement has rebutted the

presumption (except with respect to

§ 718.304, which is irrebuttable). The

presumption itself is not invalid if the

presumed fact is disproved; rather, the

evidence simply establishes that the

presumed facts are not true in the

particular case. Accordingly, the

Department rejects the commenter’s

view that the incidence of smoking

among miners necessarily causes

constitutional infirmities in the

regulatory presumptions.

(j) One comment urges the

Department to join the lawsuit filed by

the Department of Justice to recover

money from the tobacco industry for

benefits approved by the Department

based on disability caused by cigarette

smoking. The comment is not directed

to any regulatory proposal, and no

response is warranted.

(k) One comment supports the

‘‘substantially contributing cause’’

standard.

(l) No other comments have been

received concerning this section, and no

changes have been made in it.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79949

20 CFR 718.205

(a) In the initial notice of proposed

rulemaking, the Department proposed

codifying its position, unanimously

supported by circuit court precedent,

that recognizes a causal relationship

between a miner’s death and

pneumoconiosis if the disease hastened

the miner’s death. 62 FR 3345–46, 3378

(Jan. 22, 1997). The Department

responded to the comments received

when it issued the second notice of

proposed rulemaking. 64 FR 54980 (Oct.

8, 1999). Several comments urged the

Department to reinstate automatic

entitlement for survivors of miners who

were totally disabled by

pneumoconiosis, but did not die from

that disease (so-called ‘‘unrelated death

benefits’’); one comment concluded the

Department had effectuated that result

by adopting the ‘‘hastening death’’

standard in § 718.205(c)(5). The

Department rejected the first suggestion

because the 1981 amendments to the

Black Lung Benefits Act (BLBA) allow

benefits in survivors’ claims filed after

January 1, 1982, only if the miner died

due to pneumoconiosis. Similarly, the

Department disagreed with the

commenter’s interpretation of the

‘‘hastening death’’ standard, citing its

universal acceptance by the six circuits

with jurisdiction over 90 percent of

black lung claims litigation. The

Department also rejected a

recommendation that it make applicable

to claims filed after January 1, 1982, a

more lenient regulatory standard

applicable to claims filed before 1982,

since the standard was based on a

statutory presumption (30 U.S.C.

921(c)(2)) repealed by Congress in the

1981 amendments. The Department did

not propose any further changes to

§ 718.205 in the second notice of

proposed rulemaking, although the

regulation remained open for further

comment. 64 FR 54971 (Oct. 8, 1999).

(b) One comment opposes the

‘‘hastening death’’ standard because it

reinstates survivors’ ‘‘unrelated death

benefits.’’ The commenter states broadly

that any lingering, non-traumatic, death

will be affected by every disease process

present in the individual. The

Department disagrees. The commenter

does not cite any medical support for its

position, and it does not respond to the

Department’s explanation rejecting any

similarity between the ‘‘hastening

death’’ standard and ‘‘unrelated death

benefits’’ in the second notice of

proposed rulemaking. 64 FR 54980 (Oct.

8, 1999). Moreover, the commenter’s

premise overlooks the role of the claims

adjudication process, which requires the

claimant to submit credible medical

evidence establishing a detectable

hastening of the miner’s death on

account of pneumoconiosis. The party

opposing entitlement has ample

opportunity in each survivor’s claim to

submit evidence proving

pneumoconiosis played no role in the

miner’s death.

(c) One comment argues that at least

half of approved survivors’ claims are

based on deaths attributable to the

adverse health effects of smoking. The

commenter recommends reallocating

the costs of these claims to the tobacco

industry. The comment is not directed

toward any regulatory proposal, and no

response is warranted.

(d) Two comments generally assert

the ‘‘hastening death’’ standard cannot

be implemented by the Department

because the regulation violates the

notice and comment provisions of the

Administrative Procedure Act (APA), 5

U.S.C. 551 et seq. The commenters do

not indicate in what manner these APA

requirements have been violated.

Assuming the commenters are asserting

the Department improperly adopted the

‘‘hastening death’’ standard in litigation

rather than through rulemaking, the

Department disagrees. The Department

promulgated 20 CFR 718.205 in 1983,

after complying with the APA’s notice

and comment provisions, in response to

the 1981 amendments to the BLBA. 48

FR 24272 (May 31, 1983). Under those

amendments, a deceased miner’s

survivor who filed a claim on or after

January 1, 1982, is eligible for benefits

only if the miner’s death was due to

pneumoconiosis. Based on the

legislative history of the 1981

amendments, the Department provided

that death will be considered ‘‘due to

pneumoconiosis’’ where

pneumoconiosis was at least ‘‘a

substantially contributing cause or

factor.’’ 20 CFR 718.205(c)(2) (1999). In

later litigation, the Department set forth

its interpretation of the regulatory

phrase ‘‘substantially contributing cause

or factor,’’ and consistently maintained

that this standard is met by evidence

proving pneumoconiosis actually

hastened the miner’s death. The

‘‘hastening death’’ standard gives

practical meaning to the phrase

‘‘substantially contributing cause.’’ See

Bradberry v. Director, OWCP, 117 F.3d

1361, 1365–66 (11 Cir. 1997) and cases

cited therein. The Department is the

administrator of the BLBA and, in that

role, has the authority to interpret its

own regulations. Indeed, because the

Department’s interpretation is

reasonable and consistent with the

regulatory language, every court of

appeals to have considered the question

has deferred to the Department’s

interpretation. Bradberry, 117 F.3d

1361, 1366–67; Northern Coal Co. v.

Director, OWCP, 100 F.3d 871, 874 (10th

Cir. 1996); 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. 506 U.S.

1050 (1993); Lukosevicz v. Director,

OWCP, 888 F.3d 1001, 1006 (3d Cir.

1989). Accordingly, the ‘‘hastening

death’’ standard is a permissible

interpretation of § 718.205(c)(2), which

was promulgated after public notice and

comment in accordance with the APA.

(e) Two comments contend the

Department cannot apply § 718.205(c)(5)

to pending claims without violating a

prohibition on retroactive rulemaking.

(i) The Department previously

addressed the retroactivity issue in the

initial notice of proposed rulemaking.

62 FR 3347–48 (Jan. 22, 1997). The

Department acknowledged the Supreme

Court’s holding in Bowen v. Georgetown

University Hospital, 488 U.S. 204, 208

(1988), which limits the retroactive

applicability of agency regulations

unless Congress has expressly

authorized such regulations. Although

the Black Lung Benefits Act (BLBA)

does not contain the express statutory

authority required by Bowen, the

Department concluded many of the

proposed regulations could nevertheless

apply to pending claims. These

regulations, or revisions to regulations,

principally clarify the Department’s

interpretation of the BLBA and the

current program regulations. Revised

regulations which could significantly

change the regulated community’s

existing obligations and expectations,

however, apply only prospectively to

claims filed after the effective date of

the final regulations. The Department

reiterated this position in the second

notice of proposed rulemaking. 64 FR

54981–82 (Oct. 8, 1999). It rejected

recommendations to make all of the

revisions either fully retroactive or

entirely prospective. The Department

adhered to its earlier explanation in the

initial notice of proposed rulemaking:

some regulations could apply to

pending claims because they codify

existing agency interpretations of the

BLBA and regulations, while other

regulations must be limited to

prospective application because they

involve significant changes to the

existing program which could disrupt

the parties’ interests. The Department

therefore declined to adopt a single

approach for all of the revisions.

Finally, the Department rejected

arguments against retroactive

79950 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

rulemaking premised on the Contract

Clause of the United States Constitution,

art. I, § 10, cl. 1, and the impairment of

contracts. 64 FR 54981–82 (Oct. 8,

1999). (ii) The most recent comments do

not cite any legal authority

contradicting the Department’s

extensive analysis of the retroactivity

issues in the initial and second notices

of proposed rulemaking. In any event,

the Department’s analysis remains valid.

An agency regulation does not run afoul

of Bowen simply because it may operate

retroactively. ‘‘So long as a change in a

regulation does not announce a new

rule, but rather merely clarifies or

codifies an existing policy, that

regulation can apply retroactively. A

rule 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’

* * * [.]’’ Orr v. Hawk, 156 F.3d 651,

654 (6th Cir. 1998), reh’g en banc den.,

172 F.3d 411 (6th Cir. 1999), quoting

Pope v. Shalala, 998 F.2d 473, 483 (7th

Cir. 1993). See also First National Bank

of Chicago v. Standard Bank & Trust,

172 F.3d 472, 478 (7th Cir. 1999) (noting

Bowen’s ban on retroactivity is

inapplicable if rule is clarification rather

than legislative change); compare

National Mining Assoc. v. U.S. Dept. of

Interior, 177 F.3d 1, 8 (D.C. Cir. 1999)

(agency rule interpreting statute to

impose liability for pre-rule acts gives

retroactive effect which Bowen prohibits

absent express statutory authority). As

the Department explained in both the

initial and second notices of proposed

rulemaking, § 718.205(c)(5) simply

codifies the Department’s longstanding

interpretation of the legal standard for

proving a miner’s pneumoconiosis was

a ‘‘substantially contributing cause’’ of

his or her death under the BLBA and

part 718 regulations. 62 FR 3345–46

(Jan. 22, 1997); 64 FR 54980 (Oct. 8,

1999). Six circuit courts have adopted

this interpretation while no court has

disagreed. Bradberry v. Director, OWCP,

117 F.3d 1361, 1365–66 (11th Cir. 1997);

Northern Coal Co. v. Director, OWCP,

100 F.3d 871, 874 (10th Cir. 1996);

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. 506 U.S. 1050

(1993); Lukosevicz v. Director, OWCP,

888 F.2d 1001, 1006 (3d Cir. 1989); but

see Tackett v. Armco, Inc., 16 Black

Lung Rep. 1–88, 1–93 (1992), vacated on

remand 17 Black Lung Rep. 1–103, 1–

104 (1993) (rejecting ‘‘hastening death’’

standard, but vacating opinion on

remand in light of controlling decision

in Shuff). Section 718.205(c)(5)

therefore represents a clarifying

regulation which the Department may

validly implement with retroactive

effect for claims pending on the date the

regulation becomes effective. (iii) Based

on the foregoing analysis, the

Department also rejects one

commenter’s position that the BLBA

requires a ‘‘direct cause and effect

relationship’’ between the miner’s

pneumoconiosis and death in order for

a survivor to be entitled to benefits, at

least insofar as the commenter would

require that pneumoconiosis be the

immediate, sole and proximate cause of

the miner’s death. Pneumoconiosis may

be the direct, or proximate, cause of a

miner’s death (§ 718.205(c)(1)), but

entitlement may also be premised on the

lesser ‘‘hastening death’’ standard

(§ 718.205(c)(2), (5)). The circuit court

precedents cited above have

unanimously upheld this interpretation.

In both cases, a ‘‘direct’’ effect links the

pneumoconiosis to the miner’s death,

i.e., either as the leading, or

contributing, cause of the miner’s death.

The Department’s interpretation reflects

Congressional intent that benefits be

awarded if the survivor establishes that

pneumoconiosis was a contributing

cause of the miner’s death, although not

the sole and immediate cause. See 45 FR

13690 (Feb. 29, 1980); 48 FR 24276–78

(May 31, 1983).

(f) The Department received written

comments and expert hearing testimony

from physicians on the role

pneumoconiosis may play in a miner’s

death. (i) Expert Comments. Drs. Ben V.

Branscomb, Distinguished Professor

Emeritus, University of Alabama

(Birmingham), and William C. Bailey,

Professor of Medicine and Eminent

Scholar, Chair in Pulmonary Disease,

University of Alabama (Birmingham),

(Rulemaking Record Ex. 5–174,

Appendix 8), comment that the medical

literature does not substantiate any

hastening effect of simple

pneumoconiosis on the timing of a

miner’s death. They do acknowledge

that severe complicated

pneumoconiosis could have an additive

effect in some instances, but only by

reducing the miner’s lifespan

marginally. The physicians conclude

that pneumoconiosis usually does not

affect a miner’s death from non-lung

disease conditions, nor does mild or

moderate stable pulmonary

insufficiency affect other diseases

leading to death. At the Department’s

Washington, D.C., public hearing, Dr.

Branscomb also observed that simple

pneumoconiosis has no effect on the

common causes of death, and does not

otherwise influence the course of a

miner’s death. Rulemaking Record (Ex.

35), Transcript, Hearing on Proposed

Changes to the Black Lung Program

Regulations (July 22, 1997), pp 47–48.

At the same hearings, Dr. Robert Cohen,

Chief, Division of Pulmonary Medicine,

Cook County (IL) Hospital, generally

described the means by which

impairment of lung function from

pneumoconiosis could weaken the

body’s defenses to infections and

increase susceptibility to other disease

processes. Rulemaking Record (Ex. 35),

Transcript (July 23, 1997), pp 421–23.

Dr. Gregory J. Fino, board-certified in

Internal Medicine and in the

subspecialty of Pulmonary Disease,

(Rulemaking Record, Ex. 89–37,

Appendix C), notes several studies

which have shown that complicated

pneumoconiosis is a cause of death,

while other studies provide less

authoritative evidence that simple

pneumoconiosis may be a cause of

death. This physician concludes that

pneumoconiosis may be implicated in a

miner’s death provided the death is

respiratory-related and the

pneumoconiosis has caused respiratory

dysfunction during the miner’s life.

With respect to non-respiratory deaths,

Dr. Fino states that the medical

literature does not document any

contributory relationship between death

and pneumoconiosis. (ii) Scientific

literature. One of the principal scientific

documents cited by the Department in

both the initial and second notices of

proposed rulemaking is the National

Institute of Occupational Safety and

Health’s (NIOSH) Criteria for a

Recommended Standard, Occupational

Exposure to Respirable Coal Mine Dust

(1995) (Criteria). 62 FR 3343 (Jan. 22,

1997); 64 FR 54978–79 (Oct. 8, 1999);

Rulemaking Record, Exhibit 2–1. NIOSH

cited studies from the United States and

the United Kingdom which documented

increases in mortality among miners

from lung diseases related to respirable

dust. Criteria, § 4.2.5.1, Rulemaking

Record, Exhibit 2–1 at 63–64, citing

Miller BG, Jacobsen M, ‘‘Dust exposure,

pneumoconiosis, and mortality of coal

miners,’’ Br J Ind Med 42:723–733

(1985), and Keumpel ED, et al., ‘‘An

exposure-response analysis of mortality

among U.S. miners,’’ Am J Ind Med

28(2):167–184 (1995). Miller and

Jacobson noted ‘‘significant’’ increases

in mortality among U.K. miners with

radiographic evidence of progressive

massive fibrosis, and ‘‘slightly

decreased’’ survival rates among miners

with radiographic evidence of simple

pneumoconiosis compared to miners

without pneumoconiosis. Kuempel et

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79951

al. found increases in pneumoconiosis

mortality among U.S. miners with

progressive massive fibrosis, simple

pneumoconiosis and exposure to dust of

higher-rank coals. Based on these

studies, NIOSH concluded: ‘‘[M]iners

with working lifetime exposures to

respirable coal mine dust at a mean

concentration of 2 mg/m3 have an

increased risk of dying from

pneumoconiosis, chronic bronchitis, or

emphysema.’’ Criteria, § 4.2.5.1,

Rulemaking Record, Exhibit 2–1 at 64.

In the second notice of proposed

rulemaking, the Department referenced

another study which NIOSH had cited

to the Department, Coggon D, et al.,

‘‘Coal mining and chronic obstructive

pulmonary disease: a review of the

evidence,’’ Thorax 53:398–407 (1998);

see also 64 FR 54979 (Oct. 8. 1999). The

authors reviewed studies on mortality in

coal miners and reported that mortality

attributed to chronic obstructive

pulmonary disease was higher in miners

than the general population. Among the

studies submitted by one commenter is

Green FHY, Vallyathan V, ‘‘Coal

Workers’ Pneumoconiosis and

Pneumoconiosis Due to Other

Carbonaceous Dusts,’’ in Chung A,

Green FHY, eds., Pathology of

Occupational Lung Disease (2d ed.

1998) 129; see also Rulemaking Record,

Exhibit 89–21, attachment 2. Green and

Vallyathan state that ‘‘[a]pproximately

4% of coal miner deaths are directly

attributable to pneumoconiosis,’’ but

note that the ‘‘excess mortality rate from

pneumoconiosis’’ is primarily

attributable to progressive massive

fibrosis. (p. 137). The authors further

note, however, that ‘‘[d]eath from

pneumoconiosis, chronic bronchitis,

and emphysema has been related to

cumulative dust exposure,’’ citing

Miller and Jacobson, and Kuempel et al.

In contrast, Parker and Banks conclude,

‘‘a series of mortality reports have not

convincingly shown that simple [coal

workers’ pneumoconiosis] is associated

with premature mortality, but that

[progressive massive fibrosis] adversely

affects survival * * *.’’ Parker, Banks,

‘‘Lung diseases in coal workers,’’

Occupational Lung Disease (1998); see

also Rulemaking Record, Exhibit 89–21,

attachment 3. Parker and Banks also cite

the results of the study by Kuempel et

al. See also Morgan WKC, ‘‘Dust,

Disability, and Death,’’ Am Rev Resp

Dis 134:639, 641 (1986); Rulemaking

Record, Exhibit 89–21, attachment 8

(concluding more emphasis should be

placed on reducing cigarette smoking

among miners than dust levels in mines

to reduce mortality). (iii) By

incorporating the ‘‘hastening death’’

standard into the regulation, the

Department is clarifying the applicable

statutory standard: a survivor is entitled

to benefits if the miner’s death was due

to pneumoconiosis. This standard, in

the Department’s view as well as in the

unanimous view of the circuit courts of

appeals that have considered it, accords

with Congress’ intent to compensate

survivors of miners whose deaths were

in some way related to pneumoconiosis,

as that term is broadly defined by the

statute. The Department emphasizes,

however, that the survivor must

establish that the miner’s death was

hastened by pneumoconiosis in each

case. The Rulemaking Record, including

the variety of expert medical comments,

studies and opinions on the potential

contributory role of pneumoconiosis in

the deaths of coal miners, does not

demonstrate the necessity to depart

from the hastening death legal standard.

These views appear relatively consistent

in stating that complicated

pneumoconiosis (also called progressive

massive fibrosis) may contribute to a

miner’s death given the severity of the

disease. While opinions differ as to the

possibility that simple pneumoconiosis

can adversely affect the mortality

process, the Department is persuaded by

NIOSH’s conclusion that the mortality

studies it reviewed substantiate an

increased risk of death from respiratory

diseases which may be encompassed

within the BLBA’s definition of

‘‘pneumoconiosis.’’ NIOSH is the

government agency charged with

conducting research into

occupationally-related health problems.

In that capacity, the Department has

previously consulted with NIOSH

concerning issues related to the

proposed definition of pneumoconiosis

in § 718.201. 64 FR 54978–79 (Oct. 8,

1999); see also 30 U.S.C. 902(f)(1)(D)

(Department to consult with NIOSH on

criteria for tests which establish total

disability in miners). The Department

therefore considers NIOSH’s view

particularly significant in evaluating the

conflicting medical opinions concerning

the ‘‘hastening death’’ standard,

especially since its views are consistent

with other studies submitted into the

record. To the extent the commenters

express the view that simple

pneumoconiosis can never cause death,

such views are inconsistent with the

BLBA. The statute contemplates an

award of benefits based upon proof of

pneumoconiosis as defined in the

statute (which encompasses simple

pneumoconiosis), and not just upon

proof of complicated pneumoconiosis.

See, e.g., Penn Allegheny Coal Co. v.

Mercatell, 878 F.2d 106, 109–110 (3d

Cir. 1989); Wetherill v. Director, OWCP,

812 F.2d 376, 382 (7th Cir. 1987).

Similarly, regarding the connection

between simple pneumoconiosis and

non-respiratory deaths in particular, the

comments from Drs. Bailey and

Branscomb, along with those of Dr.

Fino, focus on clinical pneumoconiosis

as opposed to pneumoconiosis as more

broadly defined by the statute; thus,

they do not address whether, for

instance, chronic obstructive pulmonary

disease induced by coal mine dust

exposure can, in certain circumstances,

contribute to a non-respiratory death.

Moreover, while Drs. Bailey and

Branscomb indicate that a causal nexus

between pneumoconiosis and a nonrespiratory death would be unusual,

they do not rule it out as a medical

possibility. Dr. Cohen explained how

such a cause and effect relationship

could occur. Even though nonrespiratory deaths hastened by

pneumoconiosis may occur relatively

infrequently, the survivor should

nevertheless be given the opportunity to

prove that pneumoconiosis had a

tangible impact on the miner’s death in

those instances. Thus, the Department

believes the ‘‘hastening death’’ standard

sets a reasonable benchmark for

proving, in any particular case, that

pneumoconiosis contributed to the

miner’s death. Of course, the burden of

persuasion remains with the survivor to

prove that the miner’s death was due to

pneumoconiosis.

(g) One comment supports the

‘‘hastening death’’ standard.

(h) No other comments have been

received concerning this section, and no

changes have been made in it.

Subpart D

20 CFR 718.301

(a) In the initial notice of proposed

rulemaking, the Department proposed

deleting 20 CFR 718.301(b) (1999),

which defined ‘‘year’’ for purposes of

calculating the length of a miner’s coal

mine employment. 62 FR 3346 (Jan. 22,

1997). The Department proposed

replacing subsection (b) and a separate

provision in 20 CFR 725.493(b) (1999)

(defining ‘‘year’’ of coal mine

employment for identifying responsible

operator) with a single definition of

‘‘year’’ in § 725.101(a)(32). The

Department concluded that a single

definition with general applicability

was appropriate since the calculation of

the length of a miner’s employment is

the same inquiry under both §§ 718.301

and 725.493(b). The Department

proposed no additional changes to this

regulation in the second notice of

79952 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

proposed rulemaking. 64 FR 54971 (Oct.

8, 1999).

(b) No comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 718.307

(a) In the initial notice of proposed

rulemaking, the Department proposed

moving the content of § 718.307(a) to

§ 725.103 to establish a regulation of

general applicability concerning

burdens of proof. 62 FR 3346 (Jan. 22,

1997). The Department also proposed

deleting § 718.307(b) because it

duplicated proposed § 725.103. The

Department did not discuss § 718.307 in

its second notice of proposed

rulemaking, although the regulation

remained open for public comment. 64

FR 54971 (Oct. 8, 1999).

(b) No comments were received

concerning this section. It has therefore

been removed.

20 CFR 718.401

(a) The Department proposed deleting

20 CFR 718.401 (1999) in the initial

notice of proposed rulemaking because

the provision duplicated material in

proposed §§ 725.405 and 725.406.

Former § 718.401 addressed each

miner’s statutory right to a complete

pulmonary evaluation at no expense to

the miner, a right outlined in proposed

§ 725.406. See 30 U.S.C. 923(b). Former

§ 718.401 also addressed the

development of additional medical

evidence necessary for the adjudication

of a claim, subject matter that has been

relocated to proposed § 725.405. Since

both proposed § 725.405 and § 725.406

are regulations with program-wide

applicability, the Department noted that

no comparable regulation was necessary

in part 718. 62 FR 3346 (Jan. 22, 1997).

The Department proposed no additional

changes to this regulation in the second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999).

(b) No comments were received

concerning this section. It has therefore

been removed.

20 CFR 718.402

(a) The Department proposed deleting

20 CFR 718.402 (1999) in the initial

notice of proposed rulemaking because

its content duplicated provisions of

proposed § 725.414, which addressed a

claimant’s unreasonable refusal to

cooperate in the medical development

of his claim. 62 FR 3346 (Jan. 22, 1997).

The Department proposed no additional

changes to this regulation in the second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999).

(b) No comments were received

concerning this section. It has therefore

been removed.

20 CFR 718.403

(a) The Department proposed deleting

20 CFR 718.403 (1999) in the initial

notice of proposed rulemaking and

placing its provisions in part 725 as

proposed § 725.103. Section 718.403

dealt with a party’s burden of proof, and

part 725 did not contain a comparable

provision of program-wide applicability.

62 FR 3346 (Jan. 22, 1997). The

Department proposed no additional

changes to this regulation in the second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999).

(b) No comments were received

concerning this section. It has therefore

been removed.

20 CFR 718.404

(a) The Department proposed deleting

20 CFR 718.404 (1999) in the initial

notice of proposed rulemaking and

placing its provisions in part 725 as

proposed § 725.203(c) and (d). Former

§ 718.404(a) addressed a miner’s

obligation to inform the Department if

(s)he returns to coal mine employment;

subsection (b) recognized the

Department’s authority to reopen a

miner’s final award during his or her

lifetime and develop additional

evidence if any issue arises concerning

the continuing validity of the award. 62

FR 3346 (Jan. 22, 1997). The Department

proposed no additional changes to this

regulation in the second notice of

proposed rulemaking. 64 FR 54971 (Oct.

8, 1999).

(b) No comments were received

concerning this section. It has therefore

been removed.

Appendix B to Part 718

(a) In the initial notice of proposed

rulemaking, the Department proposed

eliminating the option of taking an

initial inspiration from the open air

before commencing the pulmonary

function maneuver. 62 FR 3346 (Jan. 22,

1997). The Department noted that openair inspiration could not be recorded on

the spirogram, which precluded any

confirmation by a reviewing physician

that the miner had taken a full breath.

Thus, the test could yield spurious

abnormal values. In the second notice of

proposed rulemaking, the Department

proposed Appendix changes to

implement a requirement that

physicians use the flow-volume loop in

reporting pulmonary function test

results. 64 FR 54981 (Oct. 8, 1999). The

Department also responded to numerous

comments. Some comments considered

the requirement that the two highest

FEV1 results vary by no more than 5

percent or 100 ml to be overly

restrictive, and suggested either

eliminating the requirement or

liberalizing it to allow a variability limit

of 10 percent or 200 ml. The Department

was reluctant to eliminate the variation

standard completely because it provided

a baseline for ensuring the validity of

the test. The Department acknowledged,

however, that some individuals might

be unable to provide pulmonary

function results within the 5 percent

variance standard. The Department

therefore invited comment on

alternative criteria which would

guarantee reproducibility of the FEV1

and FVC values while permitting

consideration of valid FEV1 results

exceeding the 5 percent standard. Other

comments criticized the disability table

values as too stringent. The Department

declined to consider any changes to the

tables because it did not propose

revising them in the initial notice of

proposed rulemaking, and the

commenters did not provide medical

support for any revisions.

(b) Three comments oppose limiting

the acceptable variation between the

two largest FEV1’s of the three

acceptable tracings to 5 percent of the

largest FEV1 or 100 ml, whichever is

greater. See Appendix B(2)(ii)(G), of part

718. One comment urges the

Department to raise the acceptable

percentage of variability from 5 percent

to 10 percent. A second comment states

the 5 percent variation is too specific.

This commenter recommends the

physician reporting the study be

allowed to use his judgment as to

whether the test is acceptable. The third

comment, submitted by the National

Institute of Occupational Safety and

Health (NIOSH), does not identify a

specific percentage of increased

acceptable variability, but recommends

the Department include a provision

permitting consideration of pulmonary

function studies which exceed the 5

percent limit provided the failure of the

test to comply with the standard is

noted in the report. The Department

agrees with the suggested revision

recommended by NIOSH, and has

amended Appendix B(2)(ii)(G) to adopt

that suggestion with one addition. The

Department has added the phrase ‘‘by

the physician conducting or reviewing

the test.’’ This language will ensure that

a physician certifies the results of the

pulmonary function test while

recognizing that it does not meet the 5

percent variability requirement. The

amended language will provide the

adjudicator with greater flexibility in

determining whether the pulmonary

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79953

function study actually substantiates the

presence of a significant pulmonary

impairment, despite the lack of

reproducible spirometric curves within

the 5 percent range.

(c) One comment recommends the

Department revise the disability tables

and adopt the more liberal pulmonary

function disability criteria used by the

Department of Justice for the Radiation

Exposure Compensation Program.

Although the Department received

comments criticizing the table values as

too stringent in response to its initial

notice of proposed rulemaking, the

Department did not propose any

revisions to the tables in the second

notice of proposed rulemaking, in part,

because the commenters failed to

provide any medical support for their

recommendation that the tables be

modified. 64 FR 54981, 55009 (Oct. 8,

1999). The Department does not

consider the present comment to

provide a sufficient basis for revision of

these disability criteria. It constitutes

the only comment the Department has

received which included medical

evidence suggesting alternate table

values. Thus, the Department cannot

determine whether the proffered

evidence represents a consensus within

the medical community about disability

as measured by pulmonary function

studies. The Department does not have

an adequate record upon which to

formulate a judgment about the validity

of the current tables or the proposed

changes. No change in the Appendix B

table values is made.

(d) No other comments have been

received concerning this section, and no

other changes have been made in it.

Appendix C to Part 718

(a) The Department proposed

amending Appendix C in the initial

notice of proposed rulemaking to state

that arterial blood gas studies should

not be administered to a miner during,

or soon after, an acute respiratory

illness. 62 FR 3346, 3381 (Jan. 22, 1997).

In the preamble to § 718.105 in the

second notice of proposed rulemaking,

the Department stated that one comment

had noted the correct nomenclature for

partial pressure of oxygen and carbon

dioxide is an upper-case ‘‘P,’’ not the

lower-case ‘‘p’’ then in use. The

Department changed the references in

§ 718.105(c)(6) in the second proposal,

but neglected to change the Appendix C

table headings. Those changes have now

been made. 64 FR 54971, 54977, 55012,

55017–18 (Oct. 8, 1999).

(b) No other comments were received

concerning Appendix C, and no further

changes have been made in it.

20 CFR Part 722—Criteria for

Determining Whether State Workers’

Compensation Laws Provide Adequate

Coverage for Pneumoconiosis and

Listing of Approved State Laws

20 CFR Part 722

(a) In its initial notice of proposed

rulemaking, the Department proposed

removing many of the regulations in 20

CFR Part 722 because they were

obsolete. 62 FR 3346–47 (Jan. 22, 1997).

Since 1973, Part 722 has set forth a

procedure under which any state may

request that the Secretary certify that its

workers’ compensation laws provide

‘‘adequate coverage’’ for occupational

pneumoconiosis. Such a certification

would prevent any claim for benefits

arising in that state from being

adjudicated under the Black Lung

Benefits Act. 30 U.S.C. 931. In addition,

Part 722 has provided a set of specific

criteria that states were required to meet

in order to obtain the requested

certification. Because the Part 722

regulations had not been amended since

1973 although the statute had been

amended in both 1978 and 1981, the

Department proposed replacing the

specific Part 722 criteria with a general

statement of the statutory criteria for

certification and the statement that in

the future, the Department would

review the workers’ compensation laws

of any state that applies for certification

in light of the then-current statutory

requirements. The Department stated

that it would certify adequate coverage

only if state law guaranteed at least the

same compensation, to the same

individuals, as is provided by the Act.

The Department did not address Part

722 in its second notice of proposed

rulemaking. See list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) The Department has replaced a

comma in the second sentence of

§ 722.3(a) with a semicolon to correct

the punctuation of that sentence. In

addition, the Department has added the

word ‘‘relevant’’ to qualify the phrase

‘‘administrative or court decision’’ in

the same sentence. This revision

clarifies the Department’s intent that

states submit only relevant

administrative or court decisions.

(c) One comment, in the context of

setting forth alternatives for the

Department to consider under the

Regulatory Flexibility Act, urges the

Department to establish specific criteria

the Department will use to determine

when a state black lung program

provides adequate coverage for

pneumoconiosis. This revision, the

commenter suggests, would allow state

legislatures to make reasoned decisions

about whether to amend their workers’

compensation laws in an attempt to

provide the ‘‘adequate coverage for

pneumoconiosis’’ the federal statute

requires. In addition, the commenter

suggests that the Department establish a

formal, ongoing review of state workers’

compensation laws to determine

whether or not they provide adequate

coverage.

Although no state has applied for

certification in the 27 years that the

Department has administered the

program, the Department accepts the

commenter’s suggestion that the

publication of specific criteria would be

helpful to state legislators who wish to

amend their state’s laws in order to

obtain Secretarial certification and

thereby preclude the application of

federal law to their state’s coal mine

operators. Publication of a current set of

criteria, however, will require

considerable study and additional

drafting, and would needlessly delay

final promulgation of the remaining

regulations in the Department’s

proposal. Following completion of that

work, the Department will issue a new

notice of proposed rulemaking in order

to ensure that interested parties have an

opportunity to comment upon possible

Secretarial certification criteria. The

Department believes that in the interim

the revised Part 722 will accommodate

any state seeking certification.

The Department does not believe,

however, that it would be productive to

engage in a formal, ongoing review of

each state’s laws in order to determine

whether they provide adequate coverage

for occupational pneumoconiosis. States

that revise their workers’ compensation

laws to meet the Department’s criteria

will do so in order to preempt the

application of the Black Lung Benefits

Act. Those states will have a clear

incentive to submit an application to the

Department for the appropriate

certification. Relying on states to initiate

the certification process thus makes the

most efficient use of government

resources at both the state and federal

levels.

(d) The Department has not received

any specific comments relevant to the

individual regulations in Part 722, and

no changes have been made in them.

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

20 CFR 725.1

(a) In its first notice of proposed

rulemaking, the Department proposed

adding subsection (k) to § 725.1 to

79954 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

describe the incorporation into the

Black Lung Benefits Act of a number of

provisions of the Social Security Act. In

addition, the new subsection noted the

Department’s authority to vary the

application of the incorporated

provisions. 62 FR 3347 (Jan. 22, 1997).

The Department did not discuss section

725.1 in its second notice of proposed

rulemaking, see list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) One comment submitted in

connection with the Department’s first

notice of proposed rulemaking and

renewed in connection with the

Department second notice of proposed

rulemaking criticizes subsections (j) and

(k) as confusing and inconsistent. The

comment states that the subsections are

confusing because they do not identify

the individual instances in which the

Department has altered the incorporated

provisions of the Longshore and Harbor

Workers’ Compensation Act (LHWCA)

and the Social Security Act (SSA). The

comment also argues that the two

subsections are inconsistent because

subsection (j) limits the instances in

which the BLBA departs from the

LHWCA, while subsection (k) implies

other departures may be contemplated.

With respect to the first criticism, the

Department believes that specific

enumeration of the departures from

incorporated LHWCA provisions is

unnecessary. The objective of

subsection (j) is simply to acknowledge

that certain LHWCA provisions are

incorporated into the Black Lung

Benefits Act (BLBA) and that the BLBA

confers specific authority on the

Department to promulgate regulations

which vary the terms of these

incorporated provisions. See 30 U.S.C.

§ 932(a). Subsection (k) fulfills the same

objective by acknowledging that there

are also SSA provisions incorporated

into the BLBA. Most of those provisions

were incorporated into Part B of the

BLBA, governing the adjudication of

claims filed with the Social Security

Administration prior to July 1, 1973,

when Congress amended the BLBA in

1972 and 1977. See, e.g., 30 U.S.C.

922(a)(5)(1)(B), incorporating the SSA

definition of the term ‘‘disability.’’

These provisions are also incorporated

into Part C, governing the adjudication

of claims filed with the Labor

Department, by 30 U.S.C. 940, but only

‘‘to the extent appropriate.’’ Subsection

(k) recognizes the Department’s

authority to determine the extent to

which the use of these incorporated

provisions is appropriate. Furthermore,

subsection (k) is consistent with

subsection (j) because it notes that the

Department may resolve conflicts which

arise from the incorporation of

inconsistent provisions of the two

statutes. Thus, for example, the

Department may choose to depart from

an incorporated LHWCA provision

(subsection (j)) because it has

determined that a comparable but

inconsistent SSA provision, which is

also incorporated, better serves the

interests of the program.

The Department acknowledges that,

as originally proposed, subsection (k)

did not contain any reference to the SSA

excess earnings offset, 42 U.S.C. 403(b)–

(1), incorporated into section 422(g).

The Department’s original explanation

of subsection (k), 62 FR 3385 (Jan. 22,

1997), also inadvertently omitted

specific mention of section 422(g).

Section 430 gives the Department the

authority to determine the extent to

which application of incorporated SSA

provisions into Part B of the Act is

appropriate in the context of

adjudicating claims under Part C.

Section 422(g), however, provides no

similar authority. It is located in Part C

of the Act, and the Department applies

the incorporated SSA offset provision as

if it were a part of the BLBA. See 20 CFR

725.536 (1999). The Department has

added an additional sentence to the end

of subsection (k) to describe this

incorporation. In addition, the

Department has revised the first

sentence of subsection (k) to recognize

that section 402 of the BLBA is

contained in Part A. The Department

has also revised the fourth and seventh

sentences of subsection (k) to clarify

their meaning.

(c) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 725.2

(a) In its first notice of proposed

rulemaking, the Department proposed

revising section 725.2 in order to

distinguish between revisions that

would affect pending claims and

revisions that would be applied

prospectively only, i.e., only to claims

filed after the effective date of the

revised regulations. The Department

drew a distinction between revisions

that merely clarified the Department’s

interpretation of the statute and existing

regulations or were procedural

regulations, and those that altered the

obligations and expectations of the

parties or could not easily be applied to

pending claims. 62 FR 3347–48 (Jan. 22,

1997). The Department also explained

the legal basis for its decision to apply

certain regulations retroactively. In its

second notice of proposed rulemaking,

the Department added a regulation,

§ 725.351, to the list of revised

regulations which would apply only

prospectively. 64 FR 54981–82 (Oct. 8,

1999). In addition, the Department

answered several comments, reiterating

its belief that it lacked the statutory

authority to make the final rule

applicable, in its entirety, to all pending

claims and rejecting the argument that

the Department lacked the authority to

apply any of the regulations to pending

claims.

(b) One of the comments received in

connection with section 725.367

contends that the Department’s

regulation governing the payment of

attorneys’ fees by responsible operators

should not be applied retroactively. The

Department agrees; section 725.367 was

inadvertently omitted from the list of

revised regulations in the Department’s

second notice of proposed rulemaking

that should apply only to claims filed

after the effective date of these

revisions. As revised, the regulation

significantly alters the attorneys’ fees

that are payable by the responsible coal

mine operator. See 64 FR 54987 (Oct. 8,

1999) (discussing the Fourth Circuit’s

decision in Clinchfield Coal Co. v.

Harris, 149 F.3d 407 (4th Cir. 1998)). In

addition, because section 725.367 may

increase the amount of attorneys’ fees an

operator has to pay in a contested case,

it may influence the operator’s decision

to controvert the claimant’s entitlement

to benefits. In these circumstances, the

Department agrees that the revised

version of § 725.367 should not be

applied to claims filed before the

effective date of the Department’s

rulemaking. The Department also

inadvertently omitted §§ 725.409, which

governs denials of a claim by reason of

abandonment, 725.416, which governs

informal conference proceedings, and

725.458, which governs deposition

testimony, from the list of revised

regulations that should be applied

prospectively only.

Similarly, section 725.465 was not

open for comment in the Department’s

first notice of proposed rulemaking, 62

FR 3340–41 (Jan. 22, 1997). The

Department proposed revising § 725.465

in its second notice of proposed

rulemaking, 64 FR 54971, 54997 (Oct. 8,

1999), and has revised the regulation

again in the final rule. As revised,

§ 725.465 prohibits the dismissal of the

responsible operator finally designated

by the district director from the

adjudication of claims without the

consent of the Director. The revision is

an integral part of the new rules

governing the identification,

notification, and adjudication of which

of the miner’s former employers, if any,

should be held liable for the payment of

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79955

his benefits (§§ 725.407–725.408,

725.415, 725.418, 725.491–725.495).

The Department has also revised

§ 725.421(b), which governs the referral

of a claim to the Office of

Administrative Law Judges and the

evidence to be transmitted to that Office

for admission into the record at the

hearing. The revisions to § 725.421(b)

reflect the new rules governing the

identification, notification and

adjudication of the responsible operator.

Because the revisions of those rules are

prospective only, the revised version of

sections 725.421(b) and 725.465 should

be treated similarly. The Department

has amended subsection (c) to add

§§ 725.367, 725.409, 725.416,

725.421(b), 725.458, and 725.465 to the

list of regulations which may be applied

only prospectively.

(c) A number of comments continue

to insist that the Department’s

regulations are impermissibly

retroactive, and that the Department’s

proposal violates the Supreme Court’s

decisions in Bowen v. Georgetown

University Hospital, 488 U.S. 204 (1988)

and Eastern Enterprises v. Apfel, 524

U.S. 498 (1998). In Bowen, the Supreme

Court held that, absent an explicit

statutory grant of authority,

administrative agencies could not

promulgate retroactive rules. In its first

notice of proposed rulemaking, the

Department acknowledged that the

Black Lung Benefits Act did not give the

Department authority to promulgate

regulations with a retroactive effect. 62

FR 3347 (Jan. 22, 1997). Eastern

Enterprises did not involve the

regulatory authority of administrative

agencies; in that case, a majority of the

Court held the Congress had violated

the due process clause of the Fifth

Amendment to the Constitution by

improperly imposing retroactive

burdens on coal mine operators in

enacting certain provisions of the Coal

Industry Retiree Health Benefit Act. For

purposes of analyzing the Department’s

regulations, Bowen is the more

restrictive decision. Because Congress

did not grant the Department specific

authority to engage in retroactive

rulemaking under the Black Lung

Benefits Act, the regulations will be

permissible under Bowen only if they do

not have a true retroactive effect.

Eastern Enterprises, a case in which the

retroactive effect of the legislation was

clear, is inapposite to this analysis.

The Department addressed the

retroactivity issue in its earlier notices

of proposed rulemaking, 62 FR 3347–48

(Jan. 22, 1997) and 64 FR 54981–82

(Oct. 8, 1999). The Department observed

that the issue of what constitutes a

retroactive effect is complex. With

respect to rules that clarify the

Department’s interpretation of former

regulations, the Department quoted

Pope v. Shalala, 998F.2d 473 (7th Cir.

1993), overruled on other grounds,

Johnson v. Apfel, 189 F.3d 561, 563 (7th

Cir. 1999), for the proposition that an

agency’s rules of clarification, in

contrast to its rules of substantive law,

may be given retroactive effect. The

Sixth Circuit issued a similar holding in

Orr v. Hawk, 156 F.3d 651, 654 (1994).

Underlying both the Pope and Orr

decisions is the Supreme Court’s

opinion in Manhattan General

Equipment Co. v. Commissioner, 297

U.S. 129 (1936). Both the Sixth and

Seventh Circuits quote Manhattan

General for the proposition that a rule

clarifying an unsettled or confusing area

of law ‘‘is no more retroactive in its

operation than is a judicial

determination construing and applying

a statute to a case in hand.’’ 297 U.S. at

135, quoted at 998 F.2d at 483; 156 F.3d

at 653. Both courts thus recognized that

the Supreme Court’s decision in Bowen,

which was issued in 1988, did not

overrule its 1936 decision in Manhattan

General with respect to what constitutes

a retroactive rule. See First National

Bank of Chicago v. Standard Bank &

Trust, 172 F.3d 472, 478 (7th Cir. 1999)

(stating that if the regulation at issue

‘‘was merely a clarification, rather than

a legislative change, Bowen’s ban on

retroactivity is inapplicable’’).

The Department’s rulemaking

includes a number of such

clarifications. For example, the revised

versions of §§ 718.201 (definition of

pneumoconiosis), 718.204 (criteria for

establishing total disability due to

pneumoconiosis) and 718.205 (criteria

for establishing death due to

pneumoconiosis) each represent a

consensus of the federal courts of

appeals that have considered how to

interpret former regulations. See

preamble to §§ 718.201 (citing cases

recognizing an obstructive component

to pneumoconiosis); 725.309 (citing

cases recognizing the progressive nature

of pneumoconiosis); 718.204; and

718.205. Moreover, none of the

appellate decisions with respect to these

regulations represents a change from

prior administrative practice. Thus, a

party litigating a case in which the court

applied such an interpretation would

not be entitled to have the case

remanded to allow that party an

opportunity to develop additional

evidence. See Betty B Coal Co. v.

Director, OWCP, 194 F.3d 491, 501 (4th

Cir. 1999) (‘‘* * * we are reluctant to

compel reopening as a matter of

constitutional law any time debatable

questions of law are resolved by the

BRB or the courts. When such open

questions are answered, the law has

been declared, not changed.’’). Any

party to litigation must assume the risk

that a law or regulation will be

interpreted in a manner other than that

which it had hoped. The Department’s

embodiment of those decisions in

regulatory form should not insulate the

parties from their application to

pending claims.

Similarly, the regulations in Part 725

that the Department intends to apply to

pending claims represent clarifications

of unsettled or confusing areas of the

law. In particular, one commenter has

objected to the application of

§§ 725.502, 725.537, and 726.8 to

pending claims. Section 725.502

provides parties to a claim with

knowledge of when each benefit

payment is due. In the first notice of

proposed rulemaking, the Department

observed that the revisions are

consistent with the Department’s

current practice, and with appellate

decisions interpreting section 21(a) of

the Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 921(a), as

incorporated into the Black Lung

Benefits Act by 30 U.S.C. 932(a). 62 FR

3365 (Jan. 22, 1997). Section 725.537

codifies the Department’s position,

upheld in litigation, with respect to the

payment of benefits in cases in which

the miner is survived by more than one

surviving spouse. The revision ensures

the proper implementation of 42 U.S.C.

416(d)(1) and (h)(1), Social Security Act

provisions that are incorporated into the

Black Lung Benefits Act by 30 U.S.C.

902(a)(2). As Pope and Orr recognize,

Bowen does not prohibit the Department

from promulgating regulations to codify

its position with respect to these issues.

Finally, the Department has responded

to the contention that retroactive

liability is imposed by § 726.8 in the

preamble to § 726.8.

The same commenter has also argued

that §§ 725.542–.544, 725.547, and

725.548 should not be retroactively

applied to coal mine operators. Section

725.2, however, explicitly makes

§ 725.547 applicable to newly filed

claims only. Sections 725.542 through

725.544 are applicable to operators only

by operation of section 725.547; they are

therefore also applicable only to claims

filed after the effective date of these

regulations. Finally, § 725.548

represents a renaming and renumbering

of a part of the former regulation at

§ 725.547. 64 FR 55003 (Oct. 8, 1999).

The Department does not believe that its

decision to rename and renumber a

previous regulation should be

considered in any way retroactive.

79956 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

By contrast, where the revision

represents a clear change in the

Department’s interpretation, such as the

regulation governing the payment of

attorneys’ fees by responsible operators,

see 64 FR 54987 (Oct. 8, 1999)

(discussing the Fourth Circuit’s decision

in Clinchfield Coal Co. v. Harris, 149

F.3d 407 (4th Cir. 1998)), the

Department has made the change

prospective only. Similarly, the revised

procedures governing the processing

and adjudication of claims, sections

725.351, 725.406 through 725.418,

725.423, 725.454 through 725.459, and

725.465, the regulations governing the

identity of the responsible operator

liable for the payment of benefits,

sections 725.491 through 725.495, and

the revised regulation governing

operator overpayments, section 725.547,

are expressly limited in their

applicability to newly filed claims. In

addition, the revisions of sections

725.309 and 725.310, governing

additional claims and modification,

respectively, are prospective only. The

Department has thus taken considerable

care to ensure that its revisions do not

violate the Supreme Court’s general

prohibition against retroactive

regulations.

(c) One commenter urges that the

Department’s prospective revisions not

be made applicable to subsequent

claims. Instead, the commenter suggests,

they should be applied only to first-time

claims filed by new claimants. The

Department does not agree that a

subsequent claim differs from a firsttime claim for purposes of applying the

revised regulations. In 1983, the

Department considered a similar request

when it promulgated regulations to

implement the Black Lung Benefits

Amendments of 1981, which transferred

liability for certain claims from coal

mine operators to the Black Lung

Disability Trust Fund. A number of

commenters suggested that a ‘‘claim’’

should be defined as a cause of action,

so that an individual would only ever

have one ‘‘claim’’ for benefits. The

Department rejected the suggestion:

The Department believes that the claims as

cause of action analogy is misplaced. The

more correct analogy would be to a

complaint or other preliminary pleading

which is filed to initiate an adjudication of

the nature of the right or the validity of the

cause of action which is being asserted.

Throughout its various versions, the Act has

been consistent in requiring that a claim

must be filed before any determination of

eligibility for benefits could be undertaken.

48 FR 24283 (May 31, 1983). Similarly,

the Department has always required that

a subsequent claim be adjudicated

according to the standards in effect at

the time the new application is filed.

For example, a miner whose 1977 claim

was adjudicated and denied under the

interim presumption, 20 CFR § 727.203

(1999), is not entitled to have a 1987

claim adjudicated under the same

criteria. Instead, that claim must be

adjudicated under the more restrictive

Part 718 criteria. See Peabody Coal Co.

v. Spese, 117 F.3d 1001, 1007 (7th Cir.

1997). The Department does not believe

that it should alter its consistent

treatment of subsequent claims in order

to exclude those claims from

consideration under the Department’s

revised regulations.

(d) One commenter urges the

Department to alter its definition of a

‘‘pending’’ claim, which allows a claim

to be considered ‘‘pending’’ for up to

one year after it is denied. The

commenter suggests that the definition

violates the jurisdictional rules

governing finality set forth in 33 U.S.C.

§ 921. The Department does not agree

that its definition violates any

principles of finality. Currently, a

claimant may file a request for

modification at any time within one

year after the denial of a claim. 20 CFR

§ 725.310 (1999). In fact, even a new

claim filed during the one-year period

will serve to reopen the existing claim.

See Betty B Coal Co. v. Director, OWCP,

194 F3d 491, 497 (4th Cir. 1999).

Consequently, an employer has no

expectation that a denied claim has

been fully and completely resolved until

after the one-year period has passed.

The Department’s definition of a

‘‘pending claim’’ is intended to prevent

the application of certain regulatory

revisions (those which will be applied

only on a prospective basis) to any

claim that was filed before the date on

which those revisions take effect. The

definition includes claims pending at

various stages of adjudication (i.e.,

before the district directors, the Office of

Administrative Law Judges, the Benefits

Review Board, or the federal courts). In

addition, some claims that have been

finally denied prior to the effective date

of the revisions can be revived by a

subsequent request for modification. For

example, a claim may have been finally

denied three months before the rules

became effective, and the claimant may

file a request for modification nine

months later (or six months after the

revised regulations took effect). The

Department does not intend that the

revised regulations that are prospective

only (including, for example, the

limitation on evidence) be used to

adjudicate such a claim, and has drafted

the definition of a ‘‘pending claim’’ to

ensure that result.

20 CFR 725.4

(a) In its first notice of proposed

rulemaking, the Department proposed

revising subsection (d) to reflect the

Department’s decision to discontinue

publication of the Part 727 regulations

in the Code of Federal Regulations. 62

FR 3348 (Jan. 22, 1997). Subsection (d)

therefore referred parties interested in

reviewing the Part 727 regulations to the

Federal Register or the most recent

version of the Code of Federal

Regulations containing the rules. The

Department did not discuss § 725.4 in

its second notice of proposed

rulemaking. See list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) Three comments urge the

Department to continue publishing the

Part 727 regulations because some

claims governed by those regulations are

still in litigation. It remains the

Department’s position, however, that

future publication of Part 727 is

unnecessary, in part because these

regulations do not apply to any claim

filed after March 31, 1980. Thus, more

than twenty years have passed since

claims were filed to which these

regulations apply. In addition, the Code

of Federal Regulations has printed these

regulations annually for twenty years.

Consequently, access to Part 727 is

readily available in the public domain

for the relatively few claims still subject

to those regulations.

(c) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.101

(a)(i) The Department proposed

amending the definition of ‘‘benefits’’

(§ 725.101(a)(6)) in the initial notice of

proposed rulemaking to include the cost

of the initial complete pulmonary

examination of the claimant authorized

by the statute, 30 U.S.C. 923(b);

§ 725.406, and subsidized by the Trust

Fund. 62 FR 3386 (Jan. 22, 1997).

Several commenters opposed the change

because they believed the revised

definition would impose liability for the

examination’s cost on the claimant if the

claim were ultimately denied or

withdrawn. In response, the Department

assured the commenters that the cost

could not be shifted to the claimant

despite its classification as a ‘‘benefit.’’

64 FR 54982 (Oct. 8, 1999). The

Department also proposed adding a

reference to augmented benefits and a

cross-reference to its definitional

regulation (§ 725.520(c)). 64 FR 55023

(Oct. 8, 1999). The Department intended

this change for the convenience of

parties looking for a comprehensive

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79957

definition. 64 FR 54982 (Oct. 8, 1999).

(ii) Citing the Department’s

representations concerning the

exclusion of the complete pulmonary

examination from costs recoverable

from the claimant, two comments now

support the amended definition. (iii)

One comment opposes the change

because it shifts the cost of the

examination to the responsible operator

if the claim is approved. The

Department responded to this argument

in the second notice of proposed

rulemaking by noting its disagreement;

since 1978, the regulations (20 CFR

725.406(c)) have required the operator

found liable for the claimant’s benefits

to reimburse the Fund for the expenses

associated with the initial pulmonary

examination. 64 FR 54982 (Oct. 8,

1999). The present comment states the

Department does not have the authority

to shift the cost of the examination,

citing West Virginia University

Hospitals, Inc. v. Casey, 499 U.S. 83

(1991). At issue in Casey was the

authority of a federal court to shift

liability from one party to its opponent

for the fees of experts retained to

perform nontestimonial services. The

Supreme Court held the fee shifting

must be limited to the specific

categories of expenses enumerated in

the statute which authorized the trial

court to award fees. Because

nontestimonial expert services did not

come within the ambit of any statutory

category of reimbursable expenses, the

Court held the district court could not

reallocate fee liability. In so holding, the

Court rejected the argument that such

expenses could be considered part of an

‘‘attorney’s fee,’’ liability for which did

shift.

The Department considers Casey

inapposite to the redefinition of

‘‘benefits.’’ That decision establishes

only that fees for nontestimonial expert

services cannot be considered ‘‘attorney

fees’’ for purposes of a statute which

shifts attorney fee liability to a

prevailing party’s opponent. Casey does

not preclude the Department from

defining a particular nontestimonial

expert service—the § 725.406 medical

examination—as a ‘‘benefit,’’ liability

for which does shift to the responsible

operator if the claim is ultimately

approved. (iv) The Department has the

statutory authority to define ‘‘benefits’’

to include the cost of the initial medical

examination, and to require a

responsible operator to pay for the

examination in the event the claim is

ultimately approved. The Black Lung

Benefits Act (BLBA) incorporates

section 7 of the Longshore and Harbor

Workers’ Compensation Act (LHWCA).

33 U.S.C 907, as incorporated by 30

U.S.C 932(a). Section 7(e) provides:

In the event that medical questions are

raised in any case, the Secretary shall have

the power to cause the employee to be

examined by a physician employed or

selected by the Secretary and to obtain from

such physician a report containing his

estimate of the employee’s physical

impairment * * * The Secretary shall have

the power in his discretion to charge the cost

of examination or review under this

subsection to the employer, if he is a selfinsurer, or to the insurance company which

is carrying the risk, in appropriate cases, or

to the special fund * * *.

33 U.S.C. 907(e). Each miner’s claim

filed under the Black Lung Benefits Act

(BLBA) raises ‘‘medical questions’’

because the status of the minerclaimant’s pulmonary condition is the

primary issue in every claim. Section

7(e) authorizes the Department to

provide each miner-claimant with a

complete pulmonary examination, and

therefore address the ‘‘medical

questions’’ raised by the claim. Thus,

Section 7(e) provides the Department

with the method for fulfilling its

obligation under 30 U.S.C. 923(b) to

provide each miner with the

opportunity to substantiate his claim by

undergoing a complete pulmonary

evaluation. Section 7(e) also authorizes

the Department, at its discretion, to

charge the cost of the examination to the

responsible operator. The Department’s

regulations have recognized this

statutory authority since 1972, when

section 7 was first incorporated into the

BLBA, without regard to whether the

claimant ultimately prevailed. 20 CFR

725.139, 37 FR 25466 (Nov. 30, 1972)

(deputy commissioner has discretion to

assess the operator or its insurer for the

cost of a physician’s examination

conducted to resolve medical questions

raised); 725.133 (1978) (deputy

commissioner has the authority to

assess a notified operator or its insurer

for the cost of the miner-claimant’s

initial medical examination). The

Department promulgated its current

regulation implementing section 7(e) for

BLBA purposes (20 CFR 725.406(c)) in

1978 after Congress amended section

413(b) to provide for complete

pulmonary examinations. It requires the

operator adjudged liable for the

claimant’s benefits to reimburse the

Fund for the expenses associated with

the examination. The Department has

determined that such assessments are

appropriate in those cases in which the

award of benefits for which an

individual operator is liable has become

final. In the remaining cases, the

Department believes the cost of the

examinations should be absorbed by the

coal mining industry as a whole by

imposing the costs on the Trust Fund.

26 U.S.C. 9501(d)(1). As money payable

under section 932(a), which

incorporates section 7, the pulmonary

examination cost is properly classified

as a ‘‘benefit’’ and the liable operator

must reimburse the Trust Fund for such

cost under 30 U.S.C. 934. The

responsible operator is required to

secure the payment of benefits for

which it is liable under section 932. 30

U.S.C. 933(a). The Department

accordingly rejects the comment’s

position that it lacks the authority to

define ‘‘benefits’’ to include the cost of

the pulmonary examination required by

30 U.S.C. 923(b). (v) No other comments

were received concerning this

definition, and no changes were made

in it.

(b)(i) In the initial notice of proposed

rulemaking, the Department proposed

amending § 725.101(a)(13), ‘‘Coal

Preparation,’’ and (a)(19), ‘‘Miner or

Coal Miner,’’ to specify that coke oven

workers are excluded from coverage

under the BLBA. 62 FR 3386, 3387 (Jan.

22, 1997). The Department received

three comments supporting the

proposed change, which were noted in

the preamble to the second proposed

rulemaking, 64 FR 54982 (Oct. 8, 1999).

The Department further clarifies the

intended scope of these definitions. In

the initial notice of proposed

rulemaking, the Department noted a

long held position that ‘‘the preparation

activities undertaken at coke ovens are

not covered by the BLBA.’’ 62 FR 3348

(Jan. 22, 1997). The Department now

believes this language may have been

too broad, and accordingly amends the

language of § 725.101(a)(19) to effectuate

its intention that the definition of

‘‘Miner’’ exclude from coverage only

those workers in the coke industry who

are actually employed as coke-oven

workers, i.e., those at the cokeproducing ovens. See, e.g., Sexton v.

Mathews, 538 F.2d 88, 89 (4th Cir. 1975)

(holding an individual who loaded coke

ovens with coal, leveled the coal inside

the oven, and shoveled finished coke for

shipment, was not a ‘‘coal miner’’ under

the BLBA). The Department, however,

does not intend for the identity of the

individual’s employer as a coke

manufacturer to be the determinative

inquiry. In some cases, coke industry

employees may be otherwise employed

in activities which amount to custom

coal preparation or come within the

types of activities enumerated in

§ 725.101(a)(13). Those workers should

not be excluded from BLBA coverage

solely because they are employed by a

coke producer. See Hanna v. Director,

79958 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

OWCP, 860 F.2d 88, 92 (3d Cir. 1988)

(stating: ‘‘[T]he appropriate

characterization of [the claimant’s] work

for purposes of entitlement under the

Act is determined by evaluation of what

he did, and not by who employed

him’’). The plain language of the

statutory and regulatory definitions of

‘‘miner’’ focuses on what work the

individual performed and where (s)he

performed that work, and not who

employed the individual. With respect

to ‘‘Coal preparation,’’ the Department

has deleted the reference to coke oven

workers because the phrase is

redundant in view of the language in

‘‘Miner.’’ (ii) No other comments were

received concerning these definitions.

(iii) The Department has changed

§ 725.101(a)(19) by substituting the

words ‘‘coal mine dust’’ for ‘‘coal dust.’’

This change makes the regulation

consistent with the Department’s longheld position that the occupational dust

exposure at issue under the BLBA is the

total exposure arising from coal mining

and not only exposure to coal dust

itself. The Department previously

explained this position in the second

notice of proposed rulemaking. There

the Department made the same change

to § 725.491(d). 64 FR 54998 (Oct. 8,

1999). A comment responding to the

initial notice of proposed rulemaking,

62 FR 3409 (Jan. 22, 1997), had

identified an inconsistency between the

reference to ‘‘coal mine dust’’ in the

definition of a ‘‘miner’’ (§ 725.202) and

the reference to ‘‘coal dust’’ in

§ 725.491. The Department agreed that a

consistent reference to ‘‘coal mine dust’’

should be used throughout the

regulations. ‘‘Coal mine dust’’ means

any dust generated in the course of coal

mining operations, including

construction. The Department noted

that this interpretation is consistent

with Congressional intent to

compensate for a broad array of dustrelated lung diseases which can be

linked to coal mining. 64 FR 54998 (Oct.

8, 1999). Finally, by making the change

in § 725.101(a)(19), the Department

expresses its disagreement with the

result reached by the Tenth Circuit in

Bridger Coal Co./Pac. Minerals, Inc. v.

Director, OWCP [Harrop], 927 F.2d 1150

(10th Cir. 1991), which held that ‘‘coal

dust’’ means only dust actually

containing coal particulates. 927 F.2d at

1154. In the Department’s view, Harrop

represents too narrow a reading of

Congress’ intent. See William Bros., Inc.

v. Pate, 833 F.2d 261, 264 (11th Cir.

1987); Williamson Shaft Contracting Co.

v. Phillips, 794 F.2d 865, 870 (3d Cir.

1986) (both cases agreeing with the

Department that ‘‘coal mine dust’’ is a

permissible interpretation of BLBA).

(c) The Department proposed

amending § 725.101(a)(16), ‘‘District

Director,’’ in the initial notice of

proposed rulemaking to substitute that

title for ‘‘Deputy Commissioner,’’ and

ensure that any actions taken by a

district director would be afforded the

same legal force as any action of a

deputy commissioner. 62 FR 3348, 3386

(Jan. 22, 1997). No comments were

received concerning this definition, and

no changes were made in it.

(d) The Department proposed

amending § 725.101(a)(17), ‘‘Division or

DCMWC,’’ in the initial notice of

proposed rulemaking to identify the

agency within the Department which

contains the Office of Workers’

Compensation Programs and the

Division of Coal Mine Workers’

Compensation. 62 FR 3348, 3386 (Jan.

22, 1999). No comments were received

concerning this definition, and no

changes were made in it.

(e)(i) In the initial notice of proposed

rulemaking, the Department proposed

amending the definition of ‘‘workers’

compensation law’’ (725.101(a)(31)) to

exclude certain benefits paid from a

state’s general revenues. 62 FR 3387

(Jan. 22, 1997). The proposal responded

to decisions from the Benefits Review

Board and Third Circuit rejecting the

Department’s longstanding

interpretation of the term. O’Brockta v.

Eastern Associated Coal Co., 18 Black

Lung Rep.1–72, 1–79/1–80 (1994), aff’d

sub nom Director, OWCP v. Eastern

Associated Coal Co., 54 F.3d 141, 148–

150 (3d Cir. 1995). 62 FR 3348–49 (Jan.

22, 1997). The Department received

comments to its initial proposal

opposing the change and, in the second

notice of proposed rulemaking,

explained that the Third Circuit had

suggested the Department alter the

regulation to reflect accurately the

Department’s intended meaning. 64 FR

54982–83 (Oct. 8, 1999). (ii) Two new

comments support the Department’s

change. (iii) One comment opposes the

amended definition because it will

adversely affect the Trust Fund

financially by making certain state

benefits unavailable for offset against

corresponding federal benefits. The

commenter notes the change will

therefore indirectly affect the coal

producers who finance the Fund. The

comment, however, overlooks the fact

that any adverse effect on operators is

expected to be minimal because of the

very small number of claims which

would be affected by the exclusion of

state-funded benefits. This effect is also

spread across the entire industry since

the industry as a whole pays the coal

excise tax. Finally, using state benefits

entirely funded by state general

revenues to offset federal benefits would

confer a windfall on responsible

operators, at least in those few cases in

which such state payments may be

available concurrently with a period of

federal entitlement. If such were the

case, an individual operator would be

able to offset its monthly federal

benefits liability by an amount of money

the state paid the claimant from its own

general revenues. Thus, the operator

would profit by using state benefits

which it had not paid to reduce its

federal liability. The proposed

definition of ‘‘workers’ compensation

law’’ eliminates this windfall. (iv) One

comment opposes the change because it

codifies an alleged political agreement

between the Department and one

congressman, and favors only

Pennsylvania residents. The commenter

also states that the change will not affect

pending or new claims from that state,

but may have unintended consequences

elsewhere. Neither point provides any

basis for changing the Department’s

proposal, the purpose of which is to

clarify long-standing policy. With

respect to the first point, the comment

fails to consider the historical basis of

the Department’s policy and its

grounding in the legislative history of

the BLBA. Part B of the BLBA contains

a ‘‘maintenance of effort’’ provision, 30

U.S.C. 924(d), which states that no

federal benefits shall be paid to the

resident of any State which reduces the

resident’s state worker’s compensation

benefits because of a federal award.

Both Parts B and C also each require

federal benefits to be reduced by the

amount of any payments received by a

claimant under a state workers’

compensation program for disability

caused by pneumoconiosis. 30 U.S.C.

922(b), 932(g). On the eve of the BLBA’s

enactment in 1969, the House Managers

of the bill explained in the joint

conference report: ‘‘Benefit payments

made under State programs funded by

general revenues are not included in the

maintenance of effort provision in the

House amendment for the reason that

they are not to be considered workmen’s

compensation, unemployment

compensation, disability insurance

programs as such programs are generally

understood, and as they are intended to

be understood within the context of this

benefit program.’’ H.R. Rep. No. 761,

91st Cong., 1st Sess. (1969), reprinted in

Senate Comm. on Labor and Public

Welfare, Legislative History of the

Federal Coal Mine Health and Safety

Act of 1969, 1507, 1530 (1975).

Congressman Dent of Pennsylvania

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79959

reinforced this understanding in his

discussion of the offset provisions and

which state benefits could be used to

offset the federal benefits:

We are not talking about State programs

funded through general revenues. Any State

that has such programs could reduce benefits

payable to persons eligible to receive them

under this provision. If the State did not so

reduce the benefits, such benefits could not

be offset or deducted from payments under

this provision.

115 Cong. Rec. 39713 (1969). No

contrary expression of understanding

appears in the legislative history.

Consequently, the Department fairly

understood Congressional intent to

exclude state-funded disability benefits

being used to reduce federal benefits.

The Third Circuit did not invalidate the

Department’s policy or contradict its

understanding of Congressional intent;

the Court merely held that the

Department’s regulation was

inconsistent with its policy, and

therefore the policy could not be

sustained. As for the limited impact of

proposed § 725.101(a)(31) on

Pennsylvania residents, the Department

acknowledges that Pennsylvania

enacted legislation in 1970 to suspend

state benefits paid from general

revenues if the claimant received a

federal award. 77 P.S. 1401(k). Those

benefits therefore become unavailable

for offset against federal payments in

any event. The possibility remains that

Pennsylvania may change its law in the

future. Because the O’Brockta decision

raises doubt concerning the

Department’s interpretation of ‘‘workers’

compensation law,’’ the Department

believes the regulation should be

clarified to implement Congressional

intent to exclude state benefits funded

by general revenues. Finally, the

potential impact of the change on states

other than Pennsylvania is speculative

at best, but all states, like the public as

a whole, are entitled to a clear statement

of governmental policy. In the event any

other State enacts legislation

comparable to the Pennsylvania

program in the future, the legislature

will have a clear understanding of the

Department’s position on the meaning

of ‘‘workers’ compensation law.’’ (v) No

other comments were received

concerning this definition, and no

changes were made in it.

(f)(i) The Department initially

proposed a uniform definition of ‘‘year’’

(§ 725.101(a)(32)) for computing the

length of coal mine employment when

required in the adjudication of claims.

62 FR 3387 (Jan. 22, 1997). Under the

proposed definition, a ‘‘year’’

encompassed either a calendar year or

partial periods totaling a year, during

which the miner must have received

pay for work as a miner for at least 125

days; computing a year included

periods when the miner received pay

while on an approved absence, e.g.

vacation or sick leave. The Department

proposed that, to the extent the

evidence permitted, the beginning and

ending dates of all periods of coal mine

employment be ascertained. In the event

the evidence was insufficient to

establish such dates or if the miner’s

employment lasted less than a year, the

Department proposed a formula for

computing the length of coal mine

employment based on the miner’s

annual earnings compared to average

wage statistics for miners compiled by

the Bureau of Labor Statistics (BLS). In

response to a comment opposing the

inclusion of approved absences from

work in computing the length of coal

mine employment, the Department cited

judicial decisions upholding its

position. 64 FR 54983 (Oct. 8, 1999). In

the second notice of proposed

rulemaking, the Department altered the

regulation to account for leap years by

adding ‘‘366 days’’ to the definition. 64

FR 55024 (Oct. 8, 1999). The

Department now has amended the

language of § 725.101(a)(32) to clarify

that periods of approved absences count

only towards the miner’s ‘‘year’’ of

employment, and not to the actual 125

‘‘working days’’ during which the miner

must have worked and received pay as

a miner. Thus, in order to have one year

of coal mine employment, the regulation

contemplates an employment

relationship totaling 365 days, within

which 125 days were spent working and

being exposed to coal mine dust, as

opposed to being on vacation or sick

leave. (ii) In response to the second

notice of proposed rulemaking, two

comments support the new definition

because it does not afford definitive

weight to Social Security

Administration records. The

Department emphasized in its second

notice of proposed rulemaking that

§ 725.101(a)(32) does not place special

weight on any particular type of

evidence in determining how long an

individual worked as a coal miner. 64

FR 54983 (Oct. 8, 1999). Rather,

§ 725.101(a)(32)(ii) recognizes that

factual findings concerning a miner’s

work history should be based on all of

the credible evidence available to the

adjudicator. (iii) One comment opposes

the proposed formula for computing a

year because it may underestimate a

miner’s employment if the miner

worked in a low-wage geographic area.

The commenter urges crediting a Social

Security earnings quarter of coverage as

a calendar quarter of coal mine

employment, particularly for periods of

coal mine employment that occurred

many years ago. Although this comment

raises a legitimate concern, no change in

the regulation is necessary. The

proposed formula provides a default

means of determining the length of time

an individual worked as a coal miner.

This method may be used when the

beginning and ending dates of the

miner’s work cannot be ascertained

from the existing evidence, or the miner

worked less than a year as a miner.

Moreover, the Department notes that the

regulation allows a party to introduce

any relevant evidence concerning the

miner’s employment. In any individual

case, the miner may prove that the

wages he received were below the

industry average. (iv) One comment

opposes the inclusion of non-work

periods of employment when

calculating a year of employment

because the miner is not exposed to any

occupational hazard during such

periods. The Department disagrees, at

least with respect to determining

whether the miner worked a ‘‘year.’’

Judicial precedent has firmly

established the legitimacy of counting

periods of absence from the workplace

for sickness or vacations as part of the

miner’s year(s) of employment. See 64

FR 54983 (Oct. 8, 1999). Despite the lack

of actual exposure to coal mine dust

during these periods, the employment

relationship between the miner and his

employer remains intact. Consequently,

such periods of non-exposure may be

included in the computation of the

miner’s work history. The Department

agrees, however, that such absences

should not be included when

determining whether the miner actually

worked at least 125 days during the

year. The 125-day requirement means

days of actual employment as a coal

miner, and the regulation has been

clarified to make the Department’s

position clear. See generally Director,

OWCP v. Gardner, 882 F.2d 67, 69–70

(3d Cir. 1989) (noting ‘‘[t]he 125 day

limit [in 20 CFR 725.493(b)] relates to

the minimum amount of time the miner

may have been exposed to coal dust

while in employment by [the]

operator.’’); but see Thomas v.

BethEnergy Mines, Inc., 21 Black Lung

Rep. 1–10 (1997) (holding sick leave

may be counted in determining whether

miner worked 125 days during year).

Thus, the periods of approved absence

from the workplace may be counted

only towards the miner’s calendar year

of work. (v) One comment generally

opposes the definition contending it is

based on outmoded concepts and

79960 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

science. The commenter notes that

miners today are exposed to less dust as

a result of more hygienic working

conditions. The Department, however,

believes the definition provides a

rational methodology for determining

the length of a miner’s employment

relationship with an operator. The

essential issues are the period(s) of time

the coal mine operator employed the

miner, and the number of days during

a year of employment that the

individual actually worked as a coal

miner. If the miner actually worked at

least 125 days during a calendar year or

partial periods of different years totaling

a 365-day period, then the miner has

worked one year for purposes of the

program regulations. Whether the miner

was exposed to reduced levels of coal

mine dust during the working days is

irrelevant to this computation. Rather,

such evidence may be relevant to an

operator’s attempt to rebut the

presumption of regular and continuous

exposure to coal mine dust found in

§ 725.491(d). With respect to the 125-

working day issue, the Department

notes its disagreement with Landes v.

Director, OWCP, 997 F.2d 1192, 1197–

98 (7th Cir. 1993), and Yauk v. Director,

OWCP, 912 F.2d 192, 195 (8th Cir. 1989)

(both cases decided under 20 CFR

718.301(b)). In both cases, the court held

that a miner should receive credit for a

full year of employment for each partial

period of each calendar year during

which the miner worked at least 125

days. The Department believes the

partial periods must be aggregated until

they amount to one year of coal mine

employment comprising a 365-day

period. Only then should the factfinder

determine whether the miner spent at

least 125 working days as a coal miner

during the year. See Croucher v.

Director, OWCP, 20 Black Lung Rep. 1–

67 (1996) (holding ‘‘year’’ means

calendar year or partial periods totaling

calendar year; opposing party may

establish irregular employment by

showing miner worked fewer than 125

days during year). Consequently, no

basis has been provided for abandoning

the proposed definition of a ‘‘year.’’ (vi)

No other comments were received

concerning this definition, and no

changes were made in it.

20 CFR 725.103

(a) In the initial notice of proposed

rulemaking, the Department proposed

§ 725.103 as a regulation of general

applicability to delineate the general

burdens of proof for the parties to a

claim. 62 FR 3388 (Jan. 22, 1997). The

comments opposing this regulation

challenged the Department’s authority

to adjust the burdens of proof among the

parties. The Department responded with

a detailed analysis of the relevant

precedent and its own authority. 64 FR

54972–74 (Oct. 8, 1999). For a number

of reasons, the Department concluded

that the Administrative Procedure Act

(APA), 5 U.S.C. 556(d), does not

preclude it from incorporating

presumptions into the regulations

which reallocate the burden of proving

certain facts. First, the statute itself

places limitations on the operation of

the APA while conferring on the

Secretary broad regulatory authority.

The Federal Mine Safety and Health Act

(FMSHA), which includes the Black

Lung Benefits Act (BLBA) as title IV,

generally exempts its provisions from

the APA. 30 U.S.C. 956. The BLBA,

however, incorporates section 19 of the

Longshore and Harbor Workers’

Compensation Act (LHWCA), 33 U.S.C.

919(d), thereby making the APA

applicable to the adjudication of claims.

The incorporation of the APA is subject

to one important constraint: Congress

conferred on the Secretary the authority

to vary the terms of the incorporated

provisions by regulation. 30 U.S.C.

932(a) (provisions of LHWCA apply to

BLBA ‘‘except as otherwise provided

* * * by regulations of the Secretary’’).

See generally Director, OWCP v.

National Mines Corp., 554 F.2d 1267,

1273–74 (4th Cir. 1977); Patton v.

Director, OWCP, 763 F.2d 553, 559–60

(3d Cir. 1985). Second, the Department

noted that the Supreme Court’s decision

in Director, OWCP v. Greenwich

Collieries, 512 U.S. 267 (1994), did not

address, much less restrict, the

Department’s statutory authority to alter

the applicability of the APA. In

Greenwich Collieries, the Supreme

Court addressed only whether the

Department had promulgated a

regulatory presumption (20 CFR 718.3)

that required a finding for the claimant

if the evidence for and against a

claimant on a particular issue was

evenly balanced. The Court considered

§ 718.3(c) too ambiguous to operate as

an exception to the APA’s requirement

that the party who bears the burden of

persuasion must prevail by a

preponderance of the evidence. Because

the Court’s interpretation of the

regulation resolved the issue, the Court

did not reach the Department’s

argument that it has statutory authority

to override 5 U.S.C. 556(d) by regulation

and shift the burden of persuasion as

well. Furthermore, the Court did not

decide which party bears the burden of

persuasion; rather, it determined only

what standard of proof must be met by

the party bearing the burden of

persuasion. The Department therefore

concluded Greenwich Collieries does

not prohibit the Department from

assigning burdens of proof to parties

other than the claimant if necessary to

achieve the goals of the BLBA. 64 FR

54973 (Oct. 8, 1999). Finally, the

Department surveyed other decisions

which upheld the authority of an agency

to allocate the burden of persuasion by

means of factual presumptions. This

caselaw lent additional support for the

Department’s conclusion that its general

rulemaking authority permitted it to

adjust the burdens of proof among the

parties, provided a rational basis existed

between the proven facts and those

presumed.

(b) One comment contends the

Department has no authority under the

APA to allocate burdens of proof in a

proceeding before an administrative law

judge (ALJ). The comment cites no

authority, statutory or otherwise, for this

proposition. For purposes of responding

to the comment, the Department

assumes the reference to ALJ

proceedings means a reference to a

proceeding governed by the APA,

including 5 U.S.C. 556(d) (allocating

burden of persuasion to proponent of a

rule or order). In the second notice of

proposed rulemaking, the Department

examined the statutory authority which

permits it to vary the terms of the APA

by regulation. 64 FR 54973 (Oct. 8,

1999). The comment provides no

refutation of the conclusions drawn

from this analysis. Because the

Department has already responded to

the substance of the comment’s

objection, no further response is

warranted.

(c) One comment suggests the

Supreme Court’s decision in Allentown

Mack Sales & Service, Inc. v. NLRB, 522

U.S. 359 (1998), prohibits the

Department from reallocating burdens of

proof absent statutory authority. As an

initial matter, the Department addressed

this decision in its second notice of

proposed rulemaking. 64 FR 54973 (Oct.

8, 1999). The Department quoted dicta

from the majority opinion which

explicitly supports the authority of an

agency to promulgate ‘‘counterfactual

evidentiary presumptions * * * as a

way of furthering legal or policy

goals[.]’’ 522 U.S. at 378. The comment

does not respond to this analysis, or

explain in what manner the Department

has erroneously interpreted the

decision. In any event, the Department

believes Allentown Mack provides no

precedential basis for limiting the

Department’s authority to assign

burdens of production and persuasion

to parties other than the claimant. That

case involved a dispute over the

evidentiary showing a company must

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79961

make to deny recognition to an

incumbent union. According to NLRB

case law, the company must establish a

‘‘reasonable doubt’’ that the union

enjoys the majority support of its

members. The NLRB held that

Allentown Mack had not established the

existence of such doubt by a

preponderance of the evidence. The

Supreme Court ultimately overturned

the Board’s factual findings because the

Court concluded the Board had applied

in actuality a higher burden of proof

than it had announced in its decisions.

522 U.S. at 378–80. Although the

comment depicts this decision as an

extension of Greenwich Collieries,

Allentown Mack has no bearing on an

agency’s authority to vary the terms of

the APA or reallocate the burden of

persuasion to a party other than the

proponent of a rule or order. Allentown

Mack establishes only the proposition

that an agency cannot announce one

standard of proof in principle and apply

a higher standard of proof in practice.

The Department therefore rejects the

comment’s position.

(d) No other comments were received

concerning this definition, and no

changes were made in it.

Subpart B

20 CFR 725.202

(a) The Department proposed

changing the definition of ‘‘miner’’ in

the initial notice of proposed

rulemaking. 62 FR 3388–89 (Jan. 22,

1997). Specifically, the Department

proposed creating a rebuttable

presumption that any individual

working in or around a coal mine or

coal preparation facility was a ‘‘miner’’

within the meaning of the Black Lung

Benefits Act (BLBA). The party liable for

benefits could rebut the presumption by

proving the individual did not perform

coal extraction, preparation or

transportation work while at the mine

site, or did not engage in mine

maintenance or construction. The

presumption could also be rebutted by

demonstrating that the individual was

not regularly employed around a coal

mine or coal preparation facility. The

Department also proposed restructuring

the existing regulation (20 CFR 725.202)

to differentiate special provisions

applicable only to transportation and

construction workers. See generally 64

FR 3349 (Jan. 22, 1997). The Department

did not propose any further changes to

this regulation in the second notice of

proposed rulemaking. 64 FR 54971 (Oct.

8, 1999).

(b) Two comments generally object to

the revised definition of ‘‘miner,’’

arguing that it forces operators to defend

against claims from employees only

peripherally involved in the coal mining

process. The revisions primarily

rearrange the component parts of 20

CFR 725.202(a), and segregate special

provisions involving construction and

transportation workers. The regulation

does include a rebuttable presumption

that any on-site worker at a coal mine

or coal preparation facility is a ‘‘miner.’’

This presumption reflects the rational

assumption that an individual working

in or around a coal mine is involved in

the extraction, preparation or

transportation of coal, or in the

construction of a mine site; these

functions are enumerated by the

statutory definition of a ‘‘miner.’’ The

operator may rebut the presumption by

disproving either the required nexus

between the worker’s duties and coal

mining, or any regular employment at a

coal mine facility. This burden is not

onerous given the operator’s access to

information about the use and duties of

the workers at its facilities.

(c) One comment objects to coverage

for coal mine construction workers

whose jobs are integral to the

construction of a coal mine site or

facility. The commenter argues that

coverage should include only those

construction workers whose jobs are

integral to the extraction or preparation

of coal, citing William Bros., Inc. v. Pate,

833 F.2d 261 (11th Cir. 1987), and

Bridger Coal Co./Pac. Minerals, Inc. v.

Director, OWCP [Harrop], 927 F.2d 1150

(10th Cir. 1991), and only if those

individuals are also exposed to coal

dust as a result of their work. The

Department, however, believes the focus

on mine construction, rather than coal

extraction or preparation, is consistent

with Congressional intent in extending

coverage to construction workers. The

Fourth Circuit has identified the flaw in

using the traditional ‘‘situs/function’’

test for coal mine construction workers:

‘‘Coal mine construction * * * involves

neither the extraction nor preparation of

coal. If, therefore, we apply the two-step

test to coal mine construction workers,

they would rarely, if ever, qualify as

miners under the Act.’’ The Glem Co. v.

McKinney, 33 F.3d 340, 342 (4th Cir.

1994). The logical inquiry concerning

the construction workers’ activities

must therefore look to coal mine

construction, which inevitably (and

generally) involves the pre-extraction

work of building the mine facility itself.

That such work is consistent with work

at a coal mine is evident from the

statutory definition of ‘‘coal mine:’’ ‘‘an

area of land and all structures, facilities,

* * * shafts, slopes, tunnels * * * and

other property, real or personal, * * *

used in, or to be used in, the work of

extracting’’ coal. 30 U.S.C. 802(h)(2)

(emphasis supplied); see also 20 CFR

725.101(a)(23) (renumbered as

§ 725.101(a)(12)). A construction worker

who builds the ‘‘coal mine’’ is a

‘‘miner’’ to the extent work at the

covered site exposes him or her to ‘‘coal

mine dust.’’ Moreover, the fact that the

claimant worked at non-operational

mines is not, by itself, sufficient to

establish a lack of coal mine dust

exposure. The construction process

itself may expose the miner to coal mine

dust. In addition, a coal mine

construction worker exposed to coal

mine dust from an operating coal mine

in the vicinity of the construction site is

a ‘‘miner’’ under the Black Lung

Benefits Act (BLBA). R&H Steel

Buildings v. Director, OWCP, 146 F.3d

514, 516–17 (7th Cir. 1998).

Pate and Harrop, cited by the

commenter, do not provide compelling

authority to depart from the proposed

regulation. In Pate, the Court stated that

‘‘construction workers are covered only

if they have been exposed to dust

arising from the extraction or

preparation of coal.’’ 833 F.2d at 266

(footnote omitted). Limiting covered

construction activities to work involving

dust exposure from coal extraction and

preparation, however, incorrectly

combines two independent elements of

the definition of ‘‘miner’’: the

‘‘function’’ requirement for qualifying as

a miner under the BLBA, i.e., working

in the extraction or preparation or

transportation of coal or in coal mine

construction, and the exposure

requirement for a construction worker.

The two are unrelated. The only

plausible explanation for separately

including construction workers in the

statutory definition of ‘‘miner’’ is

Congress’ recognition of their unique

functional status. Construction workers

generally perform their work before a

mine becomes operational.

Consequently, they generally will not be

involved in the extraction or

preparation of coal, or exposed to dust

from such activities. While rejecting this

position, the Court did acknowledge the

Department’s authority to implement its

views through regulation: ‘‘If the

Secretary has a position he wishes to

express, he can do it through the proper

forum, i.e., the implementation of new,

clarifying regulations.’’ 833 F.2d at 265.

Section 725.202 represents the exercise

of that authority.

In Harrop, the Court held that the

exposure to ‘‘coal mine dust,’’ required

by 20 CFR 725.202(a) for coverage of a

construction worker, involves exposure

to ‘‘dust containing coal.’’ 927 F.2d at

1154, citing Pate. It interpreted the

79962 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

statutory coverage of construction

workers to reach only those individuals

who are exposed to actual coal dust,

despite acknowledging the variety of

other (non-coal) dusts which may be

inhaled at a mine construction site. The

Department has consistently taken the

position that ‘‘coal mine dust’’ means

any dust generated at a coal mine site,

and that exposure to coal mine dust is

sufficient to meet the statutory

definition of ‘‘miner’’for construction

workers. 20 CFR 725.202(a); see

generally Williamson Shaft Contracting

Co. v. Phillips, 794 F.2d 865, 869 (3d

Cir. 1986) (upholding validity of 20 CFR

725.202(a) because Congress understood

‘‘coal dust’’ to mean ‘‘the various dusts

around a coal mine’’). The interpretation

of coverage reached by the Court in

Harrop would effectively exclude most,

if not all, construction workers from the

definition of ‘‘miner’’ after Congress

explicitly changed the definition to

include them. The Department declines

to adopt the more restrictive standard

suggested by the Tenth Circuit and the

commenter.

(d) One comment objects to the

application to construction workers of

the rebuttable presumption that any onsite worker is a ‘‘miner.’’ For the reasons

expressed in paragraph (b), the

Department believes any individual

whose employment requires him or her

to perform work at a coal mine can

logically be presumed to be involved in

a covered coal mine function. The

commenter has provided no reason to

exclude construction workers from that

presumption, and the Department

declines to do so.

(e) One comment received after

publication of the initial notice of

proposed rulemaking and referenced

again after publication of the second

notice objects to subsection (d), which

describes the elements of entitlement for

a miner and references the specific

regulatory criteria in Part 718 for

establishing those elements. The

comment links its objection to criticisms

of the specific Part 718 regulations

rather than any aspect of subsection (d).

The Department’s responses to those

criticisms are discussed under the

particular Part 718 sections. No further

response in the context of this

regulation is necessary.

(f) Two comments support the revised

section 725.202.

(g) No other comments concerning

this section have been received, and no

changes have been made in it.

20 CFR 725.203

(a)(i) The Department proposed

changing § 725.203 in the initial notice

of proposed rulemaking to eliminate the

filing of a claim as an element of

entitlement for a miner. 62 FR 3389 (Jan.

22, 1997). This change clarified that a

miner is entitled to benefits for all

periods of compensable disability,

including any period which occurred

prior to the filing of the claim. 62 FR

3349 (Jan. 22, 1997). The Department

also incorporated into § 725.203

provisions from 20 CFR 718.404, which

was deleted. These provisions require

an entitled miner to notify the

Department if (s)he returns to coal

mining or comparable work, and

authorize the Department to reopen a

final miner’s award in appropriate

circumstances for the development of

additional evidence and the

reevaluation of entitlement. 62 FR 3349,

3389 (Jan. 22, 1997). Finally,

§ 725.203(b)(2) now refers to § 725.504,

which is the renumbered version of

§ 725.503A. 62 FR 3341 (Jan. 22, 1997).

The Department proposed no further

changes to § 725.203 in the second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999). (ii) The

Department has now further amended

§ 725.203(d), however, to restore

language requiring the beneficiary to

submit ‘‘medical reports and other

evidence’’ if the Office determines the

evidence is necessary to resolve any

question concerning the validity of the

award. This phrase appears in 20 CFR

718.404(b), and was inadvertently

omitted in the earlier proposal to change

§ 725.203. The Benefits Review Board

has since interpreted the phrase in

§ 718.404(b) to involve discovery

requests. Stiltner v. Westmoreland Coal

Co., Black Lung Rep., BRB No. 98–0337,

slip op. at 5 (Jan. 31, 2000) (en banc).

The Department did not intend the

changes to § 725.203(d) to foreclose

evidentiary development other than

medical examinations of the miner. The

Department therefore adds the language

formerly in § 718.404(b) to § 725.203(d),

and clarifies its intent that the miner

may be required to submit to medical

examinations, produce medical

evidence and answer discovery requests

when the circumstances raise any issue

concerning the validity of the award

after the award becomes final.

(b)(i) One comment suggests the

revision of subsection (a) improperly

extends the eligibility period. The

Department rejects this interpretation.

The change merely harmonizes that

provision with § 725.503, and ensures

the miner’s entitlement to benefits for

any period of eligibility which predates

the filing of a claim. See 62 FR 3349

(Jan. 22, 1997). (ii) Two comments

approve of the change to subsection (a).

(c) Three comments oppose

subsection (d) because it permits the

Department to reopen an approved

claim if issues arise concerning its

validity. Subsection (d) simply

recognizes the Department’s authority to

investigate any finally approved miner’s

claim if circumstances raise an issue

pertaining to the validity of the award.

Such authority is necessary in order to

monitor a miner’s continuing eligibility

and prevent the payment of benefits to

any claimant whose eligibility ceases.

The Department rejects the suggestion

that this authority should be limited to

cases involving fraud or the miner’s

return to coal mining. Limiting the

reopening authority under subsection

(d) in this manner would be

inconsistent with the Department’s

statutory authority to modify an award

based on a factual mistake or change in

condition at any time within one year

after the last payment of benefits. 33

U.S.C. 922, as incorporated by 30 U.S.C.

932(a); 20 CFR 725.310. Furthermore,

such a limitation would impinge on the

right of responsible operator to petition

for modification and request a medical

examination if circumstances call into

question the entitlement of the miner.

The Department emphasizes that the

responsible operator does not have an

absolute right to compel the claimant to

submit to a medical examination for

purposes of the modification petition.

Selak v. Wyoming Pocahantas Land

Company, 21 Black Lung Rep. 1–173, 1–

178 (1999); see also Stiltner v.

Westmoreland Coal Co., Black Lung

Rep., BRB No. 98–0337, slip op. at 5

(Jan. 31, 2000) (en banc) (holding

operator does not have absolute right to

compel claimant to respond to

discovery request under 20 CFR

718.404(b) in connection with

modification petition). Upon production

of reasonable evidence justifying the

request, however, the district director

(or administrative law judge) may order

the claimant to submit to a medical

examination. Selak, 21 Black Lung Rep.

at 1–179.

(d) One comment urges the

Department to limit its authority to

reopen awards under subsection (d) to

the first year after the award becomes

final. Such a limitation, however, is

inconsistent with the Department’s

statutory authority to modify. 33 U.S.C.

922, as incorporated. In the case of an

award, that authority extends to ‘‘one

year after the date of the last payment

of compensation.’’ Furthermore, the

limitation would also adversely affect

the responsible operator’s right to

request modification if it became aware

of circumstances which call into

question the validity of the award. See

response to comments (c).

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79963

(e) In response to the initial notice of

proposed rulemaking, one comment

opposed subsection (d) because the

provision did not expressly

acknowledge that a claim may be

reopened if the miner’s condition

improved. The Department previously

rejected a similar suggestion when it

promulgated the final version of 20 CFR

718.404 in 1980. The Department

initially proposed § 718.404 with a

requirement that an entitled individual

contact the Office of Workers’

Compensation Programs if ‘‘[h]is or her

respiratory or pulmonary condition

improves[.]’’ 43 FR 17727 (Apr. 25,

1978). The requirement was deleted in

the final version ‘‘in response to

comments and testimony stating that

pneumoconiosis does not, in fact,

improve.’’ 45 FR 13694 (Feb. 29, 1980).

The same commenter submitted an

additional response to the second notice

of proposed rulemaking, and now

approves of subsection (d) because it

does not preclude the right of a liable

party to challenge a final award at a

later date. The Department therefore

declines to incorporate any language

affirmatively citing improvement in a

miner’s health as grounds for reopening

an award.

(f) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.204

(a) The Department proposed

amending § 725.204 in the initial notice

of proposed rulemaking to conform the

regulatory criteria for marital

relationships to intervening changes in

the law since the regulation was issued

in 1978. 62 FR 3349–50 (Jan. 22, 1997).

The Department provided a detailed

statutory analysis in the initial notice.

To summarize: the Black Lung Benefits

Act (BLBA) incorporates the definition

of a dependent ‘‘wife’’ used by the

Social Security Act (SSA), 42 U.S.C.

416(h)(1), as incorporated by 30 U.S.C.

902(a)(2), (e). The SSA recognizes both

‘‘legal’’ and ‘‘deemed’’ spouses; the

latter is an individual who married the

wage earner while ignorant that some

legal impediment existed to deny

validity to the marriage. Before 1990,

§ 416(h) contained a provision

preventing a ‘‘deemed spouse’’ from

receiving benefits if a ‘‘legal’’ spouse

existed and was receiving benefits on

the wage earner’s account. 42 U.S.C.

416(h)(1)(B). The Department included

this limitation in the dependency

criteria when it promulgated § 725.204.

20 CFR 725.204(d)(1). In 1990, Congress

amended the SSA to remove the

prohibition on ‘‘deemed spouse’’

entitlement if a legal spouse existed and

was receiving benefits. 104 Stat. 1388–

278 to 1388–280 (1990). Legislative

history clearly established

Congressional intent to permit both the

‘‘deemed’’ spouse and the legal spouse

to receive concurrent benefits. See H.R.

Rep. No. 101–964, 1990 U.S.C.C. & A.N.

2649, 2650 (conference report).

Accordingly, the Department proposed

similar changes to § 725.204 to delete

the regulatory bar to ‘‘deemed’’ spouse

entitlement under the BLBA. The

Department proposed no additional

changes to this regulation in its second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999).

(b) Two comments approve of the

change to this section acknowledging

the eligibility of a spouse to receive

benefits despite the existence of a legal

impediment to the validity of the

marriage to the miner unless the

individual entered into the marriage

with knowledge it was not valid.

(c) No other comments concerning

this section were received, and no

changes have been made in it.

20 CFR 725.209

(a) In the initial notice of proposed

rulemaking, the Department erroneously

proposed changing § 725.209(a)(2)(ii) to

state that, in order to be considered a

dependent, a child who is at least 18

and not a student must be under a

disability that commenced before the

age of 22. 62 FR 3390 (Jan. 22, 1997).

The purpose of the change was to reflect

in the regulation itself the age by which

certain children’s disabilities must

commence, a requirement imposed by

an incorporated provision of the Social

Security Act. 42 U.S.C. 402(d)(1)(B)(ii),

as incorporated into the BLBA by 30

U.S.C. 902(g). 62 FR 3350 (Jan. 22,

1997). After further consideration,

however, the Department reproposed

the regulation without the new

language. 64 FR 55026 (Oct. 8, 1999).

Eliminating the age by which the

disability must have begun for a

dependent child harmonizes § 725.209

with the statutory definition by

preserving the distinction between a

child/augmentee and a child/beneficiary

(see § 725.221). A child who claims

benefits in his or her own right based on

personal disability (child/beneficiary)

must prove the disability arose before

age 22 as required by 30 U.S.C. 902(g).

30 U.S.C. 922(a)(3). A dependent child

who is an augmentee of a beneficiary,

however, is exempt from this

requirement because the statutory

definition of ‘‘dependent’’ explicitly

exempts a ‘‘child’’ from the requirement

that disability begin by a certain age. 30

U.S.C. 902(a)(1). See generally 64 FR

54983 (Oct. 8, 1999).

(b) Reference should be made to the

Department’s response to comments

concerning § 725.219 to determine the

effect of marriage on a child’s

dependency status under

§ 725.209(a)(1).

(c) No comments concerning changes

to this section were received in response

to either the initial notice of proposed

rulemaking or the second notice of

proposed rulemaking, and no further

changes have been made in it.

20 CFR 725.212

(a) In the initial notice of proposed

rulemaking, the Department proposed

amending § 725.212 to codify the right

of each surviving spouse of a deceased

miner to receive a full monthly benefit

without regard to the existence of any

other entitled surviving spouse. 62 FR

3390 (Jan. 22, 1997). The Department

concluded that both statutory analysis

and Congress’ intent compelled this

result, and explained at length the

reasoning behind the conclusion. 62 FR

3350–51 (Jan. 22, 1997). See also

§ 725.537, and response to comments.

The Department proposed no further

changes to this regulation in its second

notice of proposed rulemaking. 64 FR

54971 (Oct. 8, 1999).

(b) Five comments object to

subsection (b) because it permits each

surviving spouse of a deceased miner to

receive full monthly benefits if (s)he

establishes eligibility regardless of the

existence of any other entitled surviving

spouse. The commenters assert that the

change will increase the cost of paying

survivors’ benefits. Increased costs

alone do not justify denying eligible

individuals the benefits to which they

are entitled by law.

(c) Two comments argue the change is

not permitted by the relevant statutes;

one comment disputes the Department’s

conclusion that its earlier procedure

was adopted in error, citing

undocumented representations by the

Social Security Administration (SSA) to

the Department in 1978. In the initial

notice of proposed rulemaking, the

Department provided a detailed legal

analysis of the pertinent statutory

authorities and legislative history, all of

which support awarding full monthly

benefits to more than one surviving

spouse. See 62 FR 3350–51 (Jan. 22,

1997). Congress amended the Social

Security Act in 1965 to allow benefits to

a divorced surviving spouse as a

‘‘widow’’ of the miner. Pub. L. No. 89–

97, § 308(b)(1), 79 Stat. 286 (1965). The

legislative history of the amendment

clearly established Congress’ intent that

payment of benefits to two (or more)

‘‘widows’’ would not reduce the

benefits paid to either of the widows. S.

79964 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Rep. No. 404, 89th Cong., 1st Sess.

(1965), reprinted in 1965 U.S.C.C. &

A.N. 1943, 2047. In 1972, Congress

amended the BLBA definition of

‘‘widow’’ to adopt the Social Security

Act definition. 30 U.S.C. 902(e). The

legislative history is equally clear that

Congress intended to conform the BLBA

definition to the Social Security Act

definition. S. Rep. No. 743, 92nd Cong.,

2d. Sess., reprinted in 1972 U.S.C.C. &

A.N. 2305, 2332. The BLBA also

reinforces this interpretation because it

requires a ‘‘widow’’ to receive benefits

at prescribed rates and makes no

allowance for a reduction based on the

existence of more than one widow. 30

U.S.C. 922(a)(2). To date, two courts of

appeals and the Benefits Review Board

have accepted the Department’s

position. Peabody Coal Co. v. Director,

OWCP [Ricker], 182 F.3d 637, 642 (8th

Cir. 1999); Mays et al. v. Piney

Mountain Coal Co., 21 Black Lung Rep.

1–59, 1–65/1–66 (1997), aff’d 176 F.3d

753, 764–765 (4th Cir. 1999). No court

has reached a contrary result, and no

comment has addressed the substance of

this analysis. Consequently, the

Department has no basis for changing

the regulation. Finally, the Department

cannot respond to the alleged

communication between SSA and the

Department because the comment

provides no detailed evidence as to the

nature or content of the communication.

In any event, an undocumented

assertion concerning another agency’s

intention cannot form the basis for

displacing a proper interpretation of the

pertinent statutes, especially when

courts have unanimously upheld that

interpretation.

(d) One comment states that the SSA

regulations implementing part B of the

BLBA do not permit more than one

surviving spouse to receive full benefits.

SSA’s program regulations (20 CFR part

410) are silent on the entitlement of

multiple surviving spouses. In any

event, the Department has independent

authority to issue regulations for part C

of the BLBA, 30 U.S.C. 936(a), and

§ 725.212 is consistent with the

applicable provisions of the BLBA and

the SSA as incorporated.

(e) One comment states that the

current Coal Mine (BLBA) Procedure

Manual is consistent with the position

that full monthly benefits cannot be

paid to each surviving spouse when

more than one spouse qualifies for one

deceased miner. This statement is

simply erroneous. Since at least 1994,

the Procedure Manual has

unequivocally provided that ‘‘[w]hen a

surviving spouse and a surviving

divorced spouse both qualify as primary

beneficiaries, each is entitled to full

basic benefits plus full augmentation.’’

Coal Mine (BLBA) Procedure Manual,

ch. 2–900, ¶ 8.f (Sept. 1994).

(f) One comment contends the

Department lacks the authority to

require an operator to pay the same

benefit twice. The Department rejects

this contention. As discussed above, the

BLBA unequivocally requires the

payment of full monthly benefits to each

surviving spouse who fulfills the

eligibility criteria. The statute does not

recognize any limitation on the liability

for these benefits, or any reduction in

the amount to which the eligible

surviving spouse is entitled.

(g) Two comments support the change

in subsection (b).

(h) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.213

(a) The Department proposed

amending § 725.213 in the initial notice

of proposed rulemaking to harmonize

that regulation with changes to

§ 725.204, which now recognizes the

independent eligibility of a ‘‘deemed’’

spouse to receive benefits

notwithstanding the existence of a legal

spouse who is also receiving benefits. 62

FR 3351 (Jan. 22, 1997) The Department

also proposed adding paragraph (c) to

codify the right of a surviving

beneficiary, who loses eligibility

through some legal impediment, to

resume eligibility upon the cessation of

that impediment. The Department did

not propose any further changes to the

regulation in its second notice of

proposed rulemaking. 64 FR 54971 (Oct.

8, 1999).

(b) Two comments object to

reentitlement for a surviving spouse

who loses eligibility, but later

reestablishes all the requirements. The

commenter states in general terms that

the provision is contrary to the Social

Security Act (SSA), represents an

unwarranted increase in benefits

liability, and should be abandoned. The

commenter cites no specific authority

for its argument. The legislative history

of 30 U.S.C. 902(e), the statutory

definition of ‘‘widow’’ which § 725.213

implements, establishes congressional

intent to afford a miner’s widow the

same right to resumption of black lung

benefits upon termination of a

remarriage as exists for a widow

receiving SSA benefits.

The Black Lung Benefits Act (BLBA),

as enacted in 1969, defined ‘‘widow’’ to

mean

the wife living with or dependent for support

on the decedent at the time of his death, or

living apart for reasonable cause or because

of his desertion, who has not remarried.

Pub. L. 91–173, § 402(e), 83 Stat. 793

(1969) (emphasis supplied). The

emphasized language excluded from

coverage any miner’s survivor who later

remarried, without regard to the

subsequent termination of the marriage.

In 1972, Congress amended the

definition of ‘widow’ by enacting the

current version. In pertinent part, the

phrase ‘‘who is not married’’ replaced

‘‘who has not remarried.’’ The Senate

report accompanying the proposed

amendments states that ‘‘[t]he term

‘widow’ in § 402(e) is likewise redefined

to conform to the Social Security Act

definition.’’ S. Rep. No. 743, 92nd

Cong., 2d. Sess. 30, reprinted in 2

Comm. On Labor and Pub. Welfare, 94th

Cong., 1st Sess., Legislative History of

the Federal Coal Mine Health and

Safety Act of 1969, at 1974 (1975). The

legislative history therefore

unequivocally establishes congressional

intent to define ‘‘widow’’ for purposes

of the Black Lung Benefits Act and SSA

in the same manner.

At the time of the 1972 amendments

to the BLBA, the SSA defined a

‘‘widow’’ as an individual who ‘‘is not

married.’’ 42 U.S.C. 403(e)(1)(A).

Congress had previously amended the

SSA definition in 1965 by replacing the

phrase ‘‘has not remarried’’ with ‘‘is not

married.’’ Pub. L. 89–97, § 308(b)(1), 79

Stat. 286, 376 (1965). The legislative

history of the amendment indicates that

Congress intended an aged divorced

wife, widow or surviving divorced wife,

who was not married at the age of

eligibility, to retain ‘‘whatever rights to

benefits she has ever had, regardless of

intervening marriages, which have

ended in death, divorce or annulment.’’

S. Rep. No. 404, 89th Cong., 1st Sess.,

reprinted in 1965 U.S.C.C. & A.N. 1943,

2048. The legislative history therefore

underscores the congressional intention

to permit restoration of SSA eligibility

to a widow whose intervening marriage

has terminated. The Social Security

Administration regulations

implementing Part B of the BLBA

confirm this view:

An individual is entitled to benefits as a

widow, or as a surviving divorced wife, for

each month beginning with the first month

in which all of the conditions of entitlement

* * * are satisfied. If such individual

remarries, payment of benefits ends with the

month before the month of remarriage * * *.

Should the remarriage subsequently end,

payment of benefits may be resumed * * *.

20 CFR 410.211(a). The Sixth Circuit

and the Benefits Review Board have also

adopted the Department’s position, and

no circuit has taken a contrary view.

Wolf Creek Collieries v. Robinson, 872

F.2d 1264, 1266 (6th Cir. 1989); Luchino

v. Director, OWCP, 8 Black Lung Rep. 1–

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79965

453, 1–456 (1986). The commenter’s

objection must be rejected.

In promulgating § 725.213, the

Department recognizes that permitting

reentitlement of surviving spouses and

children (§ 725.219) treats these classes

of beneficiaries more generously than

surviving brothers and sisters of the

deceased miner (§ 725.223). One

comment notes it is appropriate to end

benefit entitlement permanently when a

brother or sister marries, and implies

the same treatment should be accorded

all other classes of beneficiaries and

augmentees, including surviving

spouses and children. The Department

believes the difference in treatment is

required by the BLBA. Section 412(a)(5)

states that ‘‘[n]o benefits to a sister or

brother shall be payable under this

paragraph for any month beginning with

the month in which he or she * * *

marries.’’ 30 U.S.C. 922(a)(5). This

provision terminates eligibility if a

miner’s brother or sister who is

receiving benefits marries. Unlike the

statutory definitions of ‘‘widow’’ and

‘‘child,’’ 30 U.S.C. 902(e), (g), section

412(a)(5) focuses on the occurrence of

an event when ineligibility commences

rather than the individual’s status. The

widow’s or child’s marriage status can

change over time; once the event of

marriage occurs for a brother or sister,

‘‘no benefits shall be payable.’’ The

regulations therefore exclude brothers

and sisters from reentitlement once they

marry.

(c) One comment states that

reentitling a surviving spouse after the

termination of his or her intervening

marriage is contrary to the SSA

regulations implementing part B of the

BLBA. The comment is incorrect.

Section 410.211(a) provides that

payment of benefits terminates if a

surviving spouse or divorced wife

remarries while receiving benefits;

however, ‘‘[s]hould the remarriage

subsequently end, payment of benefits

may be resumed * * * .’’ 20 CFR

410.211(a). Sections 725.213 and

410.211 are therefore entirely

consistent.

(d) Two comments support the new

subsection (c).

(e) No other comments concerning

this section were received, and no

changes have been made in it.

20 CFR 725.214

(a) The Department proposed

amending § 725.214 in the initial notice

of proposed rulemaking to conform the

regulatory criteria for marital

relationships to intervening changes in

the law since the regulation was issued

in 1978. 62 FR 3349–50 (Jan. 22, 1997).

Specifically, the Department intended

this regulation (as well as § 725.204) to

reflect statutory changes which now

permit the surviving spouse of a miner,

whose marriage is invalid due to a legal

impediment, to receive benefits

notwithstanding the existence of a

legally-married spouse who also is

receiving benefits. Consequently, the

Department proposed eliminating

language in 20 CFR 725.214(d) which

required the termination of benefits for

the surviving spouse whose marriage is

invalid upon the entitlement of the legal

spouse. The Department proposed no

additional changes to this regulation in

the second notice of proposed

rulemaking. 64 FR 54971 (Oct. 8, 1999).

For purposes of this rule, the

Department has corrected one

typographical error and made minor

grammatical changes. The first and

second notices of proposed rulemaking

used the word ‘‘interstate’’ in

§ 725.214(c) to describe a miner’s

personal property. 62 FR 3391 (Jan. 22,

1997); 64 FR 55027 (Oct. 8, 1999). The

correct word is ‘‘intestate,’’ and that

word has been substituted in the

regulation. In § 725.214(d), the

Department has deleted the word ‘‘and’’

which immediately followed the phrase

‘‘in a purported marriage between

them,’’ and added commas, as

appropriate, to clarify the meaning of

the provision.

(b) One comment objects to permitting

a surviving spouse, whose marriage to

the deceased miner may be invalid due

to certain legal impediments, to

maintain eligibility despite another

person’s eligibility as the miner’s

surviving spouse. The commenter states

generally that the provision is contrary

to the Social Security Act (SSA) and

imposes an unwarranted increase in

benefits liability. Neither objection

demonstrates any basis for abandoning

the revision. The Department proposed

the same change in connection with

§ 725.204, and provided a detailed legal

analysis of the reasons supporting the

revision in its initial notice of proposed

rulemaking. See 62 FR 3349–50 (Jan. 22,

1997). The Black Lung Benefits Act

(BLBA) incorporates the definition of a

dependent ‘‘wife’’ used by the SSA, 42

U.S.C. 416(h)(1), as incorporated by 30

U.S.C. 902(a)(2), (e). The SSA recognizes

both ‘‘legal’’ and ‘‘deemed’’ spouses as

potentially eligible for benefits on a

single wage earner’s record. The

‘‘deemed’’ spouse is an individual who

married the wage earner while unaware

that some legal impediment existed to

the marriage. Before 1990, § 416(h)

prohibited a ‘‘deemed spouse’’ from

receiving benefits if a ‘‘legal’’ spouse

existed and was receiving benefits on

the wage earner’s account. 42 U.S.C.

416(h)(1)(B). The Department imposed a

similar limitation in the dependency

criteria when it promulgated 20 CFR

725.204(d)(1). In 1990, Congress

amended the SSA to remove the

prohibition on ‘‘deemed spouse’’

entitlement if a legal spouse existed and

was receiving benefits. 104 Stat. 1388–

278 to 1388–280 (1990). Legislative

history clearly established

Congressional intent to permit both the

‘‘deemed’’ spouse and the legal spouse

to receive concurrent benefits. See H.R.

Rep. No. 101–964, 1990 U.S.C.C. & A.N.

2649, 2650 (conference report).

Accordingly, the Department proposed

similar changes to § 725.214 to delete

the regulatory bar to ‘‘deemed’’ spouse

entitlement under the BLBA. The

comment does not respond to this

analysis with any specific reasoning

demonstrating the alleged inconsistency

with the SSA or refuting the

Department’s authority to implement

this change. Finally, increased benefits

liability alone is not a legitimate basis

for denying benefits to eligible

claimants under the BLBA.

(c) No other comments concerning

this section were received, and no other

changes have been made in it.

20 CFR 725.215

(a) In the initial notice of proposed

rulemaking, the Department proposed

clarifying the intended operation of

§ 725.215(g)(3) by changing a reference

in that regulation from ‘‘section’’ to

‘‘paragraph.’’ 62 FR 3391 (Jan. 22, 1997).

The change ensures that the exception

to the nine-month marriage rule is

confined to subsection (g) rather than

applicable to the entire regulation. 62

FR 3351 (Jan. 22, 1997). The Department

proposed no additional changes to this

regulation in the second notice of

proposed rulemaking. 64 FR 54971 (Oct.

8, 1999).

(b) No comments concerning this

section were received, and no changes

have been made in it.

20 CFR 725.219

(a) In the initial notice of proposed

rulemaking, the Department proposed

changing § 725.219 to account for a

change in the age of onset of disability

in the Social Security Act (SSA), 42

U.S.C. 402(d)(1)(B), which is

incorporated into the Black Lung

Benefits Act’s (BLBA) definition of

‘‘child,’’ 30 U.S.C. 902(g). 62 FR 3350

(Jan. 22, 1997). The Department did not

propose any additional changes in the

second notice of proposed rulemaking.

64 FR 54971 (Oct. 8, 1999). The

Department, however, did assert in

general terms that marriage is a

79966 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

permanent bar to future entitlement for

any individual other than a miner’s

surviving spouse or surviving divorced

spouse. 64 FR 54983–84 (Oct. 8, 1999).

Based on this position, the Department

withdrew a proposed change to

§ 725.223 which extended reentitlement

to a miner’s surviving dependent

brother or sister if the sibling married

while receiving benefits, but the

marriage later ended.

(b) Two comments recommend

adopting a provision (analogous to

§ 725.213(c)) which would allow a

deceased miner’s surviving disabled

child, whose entitlement terminates

upon marriage, to regain eligibility

when that marriage ends. Formerly, the

regulations permitted a child whose

entitlement terminated at age 18 to

apply for reinstatement if the child was

a student, younger than age 23, and was

not married. 20 CFR 725.219(c). The

regulations did not make any provision

for reentitling a disabled child whose

entitlement is terminated by marriage.

The Department agrees with the

comments that such a provision is

appropriate, and therefore has added

subsection (d). This provision enables a

child whose entitlement terminates

upon marriage to apply for

reinstatement of benefits once the

marriage terminates. Subsection (d) also

excuses the child-beneficiary from any

requirement to reestablish the deceased

miner’s total disability or death due to

pneumoconiosis.

The BLBA provides that survivor’s

benefits ‘‘shall only be paid to a child

for so long as he meets the criteria for

the term ‘child’ contained in section

402(g).’’ 30 U.S.C. 922(a)(3). Section

402(g) defines ‘‘child’’ to mean a:

child or a stepchild who is—

(1) unmarried; and

(2)(A) under eighteen years of age, or

(B)(i) under a disability as defined in

section 423(d) of title 42

(ii) which began before the age

specified in section 402(d)(1)(B)(ii) of

title 42, or, in the case of a student,

before he ceased to be a student; or

(C) a student.

30 U.S.C. 902(g). The literal language of

the statute does not preclude a child’s

eligibility for all time based upon the

existence of a marriage. Rather, the two

statutory provisions authorize the

payment of benefits to an eligible child

survivor ‘‘for so long as’’ (s)he ‘‘is

unmarried.’’ If a marriage terminates

prior to any period of eligibility, the

child is nevertheless unmarried when

(s)he becomes entitled to benefits. See

Adler v. Peabody Coal Co., Black Lung

Rep., BRB No. 98–1513 BLA (Feb. 4,

2000). If the child marries while

receiving benefits, (s)he cannot continue

as an eligible survivor for the duration

of the marriage. Sullenberger v. Director,

OWCP, Black Lung Rep., BRB No. 99–

0449 BLA (March 8, 2000) Upon

cessation of the marital relationship,

however, the child again ‘‘is

unmarried,’’ which complies with the

statutory requirement. Assuming all

other conditions for eligibility are met,

an ‘‘unmarried’’ child retains his or her

status as a ‘‘child’’ under the plain

language of the statute notwithstanding

the occurrence of the marriage. In this

regard, the Department disagrees with

the broad statement in Reigh v. Director,

OWCP, 20 Black Lung Rep. 1–44 (1996),

that a surviving child of a miner cannot

revive her status as the unmarried

dependent of her parents upon the

death of her husband. 20 Black Lung

Rep. at 1–48.

The Department’s interpretation of the

plain language of § 402(g) gains support

from Congress’ decision to omit certain

provisions of 42 U.S.C. 402(d) (the

Social Security Act) from the BLBA.

Significantly, Congress did not

incorporate § 402(d)(6), which permits a

child to become reentitled to benefits

after turning 18 if the child is a student

under age 22 or disabled, ‘‘provided no

event specified in paragraph (1)(D) has

occurred.’’ 42 U.S.C. 402(d)(6). Section

402(d)(1)(D) states that a child’s benefits

terminate ‘‘the month preceding * * *

the month in which such child dies or

marries[.]’’ In McMahon v. Califano, 605

F.2d 49 (2d Cir. 1979), cert. den. 444

U.S. 847 the Court held that ‘‘the only

reasonable interpretation of [§ 402(d)(6)

and (d)(1)(D)] is that any marriage

occurring subsequent to a child’s initial

entitlement to benefits terminates those

benefits and prevents re-entitlement in

the future.’’ 605 F.2d at 53; see also

Downs v. D.C. Police & Firefighters

Retirement and Relief Bd., 666 A.2d 860

(D.C.C.A. 1995) (holding disabled

child’s annuity permanently terminated

when child married and later divorced).

Otherwise, the Court concluded, the

proviso language of § 402(d)(6) would be

superfluous because no other

interpretation would afford it any

meaning. Congress therefore has

implemented a policy determination

that a disabled child receiving SSA

benefits should become permanently

ineligible if the child marries, regardless

of the subsequent termination of the

marriage. By omitting the incorporation

of these provisions into the BLBA

definition of ‘‘child,’’ however, the

Department concludes that Congress did

not intend to adopt the same policy for

the BLBA.

The legislative history of the

definition of ‘‘child’’ does not support a

contrary interpretation. The BLBA

originally defined ‘‘dependent’’ to mean

a dependent wife or child within the

meaning of 5 U.S.C. 8110; ‘‘wife’’ and

‘‘child’’ were not defined separately. 30

U.S.C. 902(a) (1969). Section 8110

defined a dependent child as an

‘‘unmarried child’’ living with, or

receiving regular contributions from, the

employee if the child is under 18 years

of age; over that age but incapable of

self-support because of a physical or

mental impairment; or a student. 5

U.S.C. 8110(a)(3). In 1972, Congress

amended the BLBA to include a new

definition of ‘‘dependent’’ and separate

definitions of ‘‘child’’ and ‘‘widow.’’ 30

U.S.C. 902(a), (g), (e) (1972). The

legislative history of the 1972

amendments simply states that the

statutory definition of ‘‘child’’

conformed to the SSA definition. S.

Rep. No. 743, 92nd Cong., 2nd Sess.

(1972), reprinted in Senate

Subcommittee on Labor, Committee on

Labor and Public Welfare, 94th Cong.,

1st Sess., History of the Federal Coal

Mine Health and Safety Act of 1969, as

amended through 1974, Part 2—

Appendix at 1946, 1974 (1975). That

conformance extended only to the

specific adoption of SSA eligibility

criteria for age, disability, and student

requirements, but did not include

provisions such as the permanent ban

on reentitlement for a child who marries

in § 402(d)(6). Consequently, the

Department is free to depart from the

SSA eligibility scheme contained in

§ 402(d)(6) by permitting reentitlement.

The effect of marriage on a claimant’s

eligibility has also arisen in connection

with a miner’s surviving spouse. 30

U.S.C. 902(e). Since the 1972

amendments, the statutory definition of

‘‘widow’’ has limited eligibility to a

miner’s surviving spouse or surviving

divorced spouse ‘‘who is not married.’’

Legislative history linking the 1972

amendment of 30 U.S.C. 902(e) to

changes in the parallel SSA definition

clearly establish Congress’ intention to

permit reentitlement for a widow who

remarried after the beneficiary’s death

and later became unmarried. See

generally Wolf Creek Collieries v.

Robinson, 872 F.2d 1264, 1266 (6th Cir.

1989); Luchino v. Director, OWCP, 8

Black Lung Rep. 1–453, 1–456 (1986).

The statutory definitions of ‘‘widow’’

and ‘‘child’’ are alike in that both

require the individual to be unmarried

as a condition of eligibility. The

legislative history of the Black Lung

Benefits Act’s 1972 amendments

strongly supports limiting the effect of

an intervening marriage on a surviving

spouse’s eligibility, and does not

contradict affording the same treatment

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79967

to a child. In the absence of such

contradictory evidence of Congress’

intentions, both statutory definitions

should be construed alike given the

similarities in their language.

Accordingly, a presently unmarried

child of a miner is eligible for benefits

notwithstanding any prior marriage. The

marriage merely suspends the child’s

eligibility for benefits for the duration of

the marriage if the child marries during

a period of entitlement. Eligibility then

resumes upon termination of the

marriage, assuming all other conditions

of eligibility can be satisfied. If the

child’s marriage terminates prior to any

period of entitlement, the marriage has

no effect upon the child’s eligibility.

(c) No other comments concerning

this section were received, and no other

changes have been made in it.

20 CFR 725.221

(a) The Department proposed

changing the date of onset of disability

in § 725.221 from 18 to 22 years of age

to conform the regulation to the same

change in 42 U.S.C. 423(d). 62 FR 3350,

3392 (Jan. 22, 1997). The Department

proposed no additional changes in the

second notice of proposed rulemaking.

64 FR 54791 (Oct. 8, 1999).

(b) One comment supported the

change in the age by which disability

must commence.

(c) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.222

(a) The Department proposed

changing the date of onset of disability

in § 725.222 from 18 to 22 years of age

to conform the regulation to the same

change in 42 U.S.C. 423(d). 62 FR 3350,

3392 (Jan. 22, 1997). The Department

proposed no additional changes in the

second notice of proposed rulemaking.

64 FR 54791 (Oct. 8, 1999).

(b) One comment recommends that

subsection (b) allow a deceased miner’s

parent, brother or sister to claim benefits

unless the miner’s surviving spouse or

child has established entitlement. The

Department rejects this change because

it is inconsistent with the Black Lung

Benefits Act. Section 412 of the Act

provides guidelines for the payment of

benefits to eligible beneficiaries. 30

U.S.C. 922. Section 412(a)(5) states, in

pertinent part, that a dependent parent

of a deceased miner ‘‘who is not

survived at the time of [the miner’s]

death by a widow or a child’’ is eligible

for benefits. 30 U.S.C. 922(a)(5). The

same provision also states that a

dependent surviving sibling of the

deceased miner ‘‘who is not survived at

the time of [the miner’s] death by a

widow, child, or parent’’ is eligible for

benefits. The current language in 20

CFR 725.222(b) follows the statutory

language, and no change in that

subsection is appropriate. The statutory

provisions are unequivocal: the

existence of a surviving spouse or child

is sufficient to preclude entitlement for

other survivors even if the spouse or

child is not receiving benefits.

This interpretation is further

supported by another provision of

section 412. Paragraph (a)(3) states that

‘‘no entitlement to benefits as a child

shall be established under this

paragraph (3) for any month for which

entitlement to benefits as a widow is

established under paragraph (2).’’ 30

U.S.C. 922(a)(3). Under this provision, a

child may receive benefits even if a

surviving spouse exists unless (or until)

the spouse establishes his or her own

entitlement and supersedes the child as

the primary beneficiary. By using

different eligibility criteria within the

same statutory provision, Congress drew

a clear distinction between the

circumstances in which the existence of

an eligible surviving spouse could

preclude any potential beneficiary with

lesser standing from obtaining benefits.

The child may therefore constitute a

primary beneficiary until such time as

the spouse asserts (and proves) his or

her own entitlement; at that time, the

spouse replaces the child as the

beneficiary. The mere existence of a

surviving spouse or child, however,

does preclude an otherwise eligible

parent or sibling from claiming benefits.

The commenter’s recommended change

would violate the distinction between

classes of eligible beneficiaries which

Congress has drawn. The

recommendation must be rejected.

(c) One comment supported the

change in age, from 18 to 22, by which

disability must commence.

(d) No other comments concerning

this section were received, and no

changes have been made in it.

20 CFR 725.223

(a) In the initial notice of proposed

rulemaking, the Department proposed

revising § 725.223 to adopt the change

in age limits for disability specified by

42 U.S.C. 402(d)(1)(B), as incorporated

by the Black Lung Benefits Act (BLBA),

30 U.S.C. 922(a)(5). 62 FR 3351, 3393

(Jan. 22, 1997). The Department also

proposed adding subsection (d) to

permit reentitlement for a miner’s

dependent brother or sister whose

eligibility had terminated upon

marriage, provided the marriage ended

and the individual again fulfilled all the

eligibility criteria. The Department

thereafter reconsidered this proposal,

and suggested its removal in the second

notice of proposed rulemaking. 64 FR

55029 (Oct. 8, 1999). The Department

concluded that the proposed subsection

(d) contradicted longstanding agency

policy, which permitted reentitlement

upon cessation of marriage only in the

case of a surviving spouse. Because the

Department stated it considered a

miner’s children permanently barred

from reentitlement upon the cessation of

marriage, it declined to afford

preferential treatment to the miner’s

siblings. In the case of a married sibling

who becomes the miner’s dependent,

the Department concluded that

eligibility should not be precluded by

the existence of the marriage if the

sibling’s spouse provided no support.

Once a married sibling received support

or an unmarried dependent married,

however, the Department relied on the

assumption that the married sibling

would receive support from the spouse

and a sibling whose marriage terminated

would rely on savings or property from

the marriage, etc. 64 FR 54983–84 (Oct.

8, 1999).

(b) The Department has changed its

position that reentitlement for

beneficiaries after resumption of

unmarried status must be confined to

surviving spouses and surviving

divorced spouses. See § 725.219(d)

above, with respect to children.

Although the Department recognizes

reentitlement for children as well as

spouses, the Department has not

changed its views about the effect of

marriage as a permanent bar to

reentitlement for a miner’s brother or

sister. The BLBA supports this policy.

Section 412(a)(5) states that ‘‘[n]o

benefits to a sister or brother shall be

payable under this paragraph for any

month beginning with the month in

which he or she * * * marries.’’ 30

U.S.C. 922(a)(5). This provision is

unequivocal. Once a brother or sister

who is receiving benefits marries,

eligibility terminates. That the

termination is permanent may be

inferred from the phrasing of the

provision: upon marriage, no benefits

are payable to the sibling ‘‘for any

month’’ starting with the month of the

marriage. Section 412(a)(5) does not

include any qualifying language which

would suggest that benefits are not

payable simply for the duration of the

marriage. Rather, it identifies a point

when ineligibility commences, with no

provision for restoring eligibility. In this

regard, section 412(a)(5) differs from the

statutory definitions of ‘‘widow’’ and

‘‘child,’’ 30 U.S.C. 902(e), (g). Section

412(a)(5) links the occurrence of an

event to the termination of eligibility

79968 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

while the ‘‘widow’’ and ‘‘child’’

definitions focus on the individual’s

status. The widow’s or child’s marriage

status can change; consequently these

individuals can move in or out of

eligibility. Once a brother or sister

marries, ‘‘no benefits shall be payable

* * *.’’ The BLBA therefore requires

that a miner’s brothers and sisters be

excluded from reentitlement upon the

dissolution of marriage.

(c) One comment endorses the

withdrawal of proposed subsection (d),

and a return to current practice with

respect to the marriage of a miner’s

brothers and sisters.

(d) No other comments concerning

this section were received, and no

changes have been made in it.

Subpart C

20 CFR 725.306

(a) In its first notice of proposed

rulemaking, the Department proposed

revising § 725.306(a)(3) by crossreferencing § 725.522 so that an

unrelated revision of the term ‘‘benefits’’

in section 725.101(a)(6) would not

adversely affect a claimant’s ability to

withdraw his claim for benefits. The

Department specifically noted its

intention not to require reimbursement

of the amount spent on the claimant’s

complete pulmonary evaluation as a

condition for withdrawal of a claim,

notwithstanding its proposal to include

the complete pulmonary evaluation

within the definition of ‘‘benefits.’’ 62

FR 3351 (Jan. 22, 1997). The Department

did not discuss section 725.306 in its

second notice of proposed rulemaking.

See list of changes in the Department’s

second proposal, 64 FR 54971 (Oct. 8,

1999).

(b) Several comments opposed the

revised definition of ‘‘benefits,’’

§ 725.101(a)(6), because it includes the

cost of the miner’s complete pulmonary

examination for which the Department

is liable in the absence of a final award

of benefits. The commenters believe the

revised definition will impose liability

on the miner under § 725.306 for

repayment of the cost of the

examination if he should decide to

withdraw his claim. For the reasons

stated in the Department’s initial notice

of proposed rulemaking, 62 FR 3351

(Jan. 22, 1997), and in response to

comments received in connection with

§ 725.101(a)(6), 64 FR 54982 (Oct. 8,

1999), the Department has not made

reimbursement of the examination

‘‘benefit’’ a price for withdrawing a

claim. No other comments were

received concerning this section, and no

changes have been made in it.

20 CFR 725.308

Although the Department received

comments relevant to this section, the

regulation was not open for comment,

see 62 Fed. Reg. 3341 (Jan. 22, 1997); 64

Fed. Reg. 54971 (Oct. 8, 1999). It was

repromulgated only for the convenience

of readers. Accordingly, no changes are

being made in this section.

20 CFR 725.309

(a) In its first notice of proposed

rulemaking, the Department proposed

revising § 725.309 to clarify the rule

governing subsequent claims. 62 FR

3351 (Jan. 22, 1997). A subsequent claim

is an application filed by the same

individual after final denial of a prior

claim. The Department observed that a

majority of the federal appellate courts

that had considered the issue had

deferred to the Department’s

interpretation of the former regulation

governing such claims. That regulation

required a claimant to establish that he

had suffered a material change in

condition since the denial of his earlier

claim in order to escape the denial of

the later claim on the grounds of the

prior denial. 20 CFR 725.309 (1999).

The Department’s interpretation of that

rule allowed miners to establish the

necessary material change in condition

by introducing new evidence that

demonstrated a change in one of the

necessary elements of entitlement, such

as the existence of pneumoconiosis. The

Department proposed to codify its

interpretation by creating a rebuttable

presumption that the miner’s condition

had changed if new evidence

established one of the elements of

entitlement previously resolved against

the miner. An operator could rebut the

presumption by establishing that the

earlier denial was erroneous, i.e., that

the new evidence submitted by the

claimant did not demonstrate a change

in his condition but simply that the

earlier determination was mistaken. If

the presumption was not rebutted, the

factfinder would weigh all of the

evidence on the remaining elements of

entitlement to determine whether the

claimant was entitled to benefits. The

original proposal also provided that the

remaining issues of entitlement were

subject to de novo adjudication unless

the parties had stipulated to, or waived

their right to contest, those issues in the

earlier proceeding. Thus, once the

claimant established a change in his

condition, no parties to the claim were

entitled to rely on findings made in

connection with the denial of the prior

claim.

The Department substantially revised

its proposal in its second notice of

proposed rulemaking. 64 FR 54984–85

(Oct. 8, 1999). The Department deleted

the rebuttable presumption and

substituted a threshold test which

allowed the miner to litigate his

entitlement to benefits without regard to

any previous findings by producing new

evidence that established any of the

elements of entitlement previously

resolved against him. The Department

explained that this test effectuated the

Fourth Circuit’s decision in Lisa Lee

Mines v. Director, OWCP, 86 F.3d 1358

(4th Cir. 1996), cert. denied, 117 S. Ct.

763 (1997), by accepting the correctness

of the earlier denial of benefits. In

addition, in response to several

comments, the Department restored a

provision requiring the denial of an

additional survivor’s claim, but limited

the circumstances in which such a

denial was appropriate. The Department

proposed the automatic denial of an

additional survivor’s claim in cases in

which the denial of the previous claim

was based solely on a finding or

findings that were not subject to change.

For example, if the earlier claim was

denied solely because the miner did not

die due to pneumoconiosis, the

regulation would require the denial of

any additional claim as well. The

Department responded to other

comments, rejecting the suggestion that

the revised regulation was inconsistent

with § 22 of the Longshore and Harbor

Workers’ Compensation Act, 33 U.S.C.

922, as incorporated by 30 U.S.C. 932(a),

and § 413(d) of the Black Lung Benefits

Act, 30 U.S.C. 923(d). Finally, the

Department discussed why findings

favorable to the claimant that were

made in the previous denial of benefits

should not be given preclusive effect,

and clarified the date from which

benefits were payable in the event an

additional claim was awarded.

(b) Two comments object to the

Department’s rule allowing subsequent

claims on the basis that the record lacks

adequate justification of the latency and

progressivity of pneumoconiosis. In its

first notice of proposed rulemaking, the

Department proposed revising the

definition of the term

‘‘pneumoconiosis’’ in § 718.201 to,

among other things, explicitly recognize

that it referred to a progressive disease.

62 FR 3343–44 (Jan. 22, 1997). Several

commenters argued that the

Department’s proposed definition was

scientifically unsound, and presented

testimony from a panel of physicians

with expertise in pulmonary medicine

at the Department’s July 22, 1997

hearing in Washington, D.C. The

Department also received comments and

testimony in support of its proposal.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79969

The commenters opposed to the

Department’s proposal also objected to

the Department’s failure to consult the

National Institute of Occupational

Safety and Health (NIOSH). Although

NIOSH had commented favorably on the

Department’s proposal, and specifically

on the provision recognizing the

progressive nature of pneumoconiosis,

the Department decided, in light of the

divergent comments it had received

from medical professionals, to seek

additional guidance from NIOSH. The

Department transmitted a copy of all of

the testimony and commentary it had

received to Dr. Linda Rosenstock, the

Director of NIOSH, and asked NIOSH to

determine, in light of the then existing

record, whether NIOSH continued to

support the Department’s proposal.

NIOSH responded, in a December 7,

1998 letter from Dr. Paul Schulte, the

Director of NIOSH’s Education and

Information Division, that ‘‘[t]he

unfavorable comments received by DOL

do not alter our previous position:

NIOSH scientific analysis supports the

proposed definitional changes.’’ Dr.

Schulte provided additional medical

references to support NIOSH’s

conclusion. The Department notified

parties of this additional evidence in its

second notice of proposed rulemaking.

See 64 FR 54978–79 (Oct. 8, 1999).

One commenter accuses the

Department of obtaining assistance from

NIOSH’s information officer rather than

its scientific staff. The Department does

not agree that the identity or title of the

agency official through whom NIOSH

chose to communicate its response to

the Department’s inquiry renders that

response invalid. The Department’s

request was sent to the Director of

NIOSH, and observed that the resolution

of the issues related to the definition of

the term ‘‘pneumoconiosis’’ required

scientific and medical expertise. Dr.

Schulte’s letter, transmitted on behalf of

NIOSH in response to the Department’s

request, specifically refers to ‘‘NIOSH

scientific analysis.’’ Accordingly, the

Department rejects the commenter’s

inferences that its consultation with

NIOSH was less than complete, and that

the Department sought to exclude the

agency’s scientific staff. To the extent

that the statute imposes an obligation to

consult with NIOSH on the definition of

‘‘pneumoconiosis,’’ the Department has

fully complied with that obligation.

The commenters opposed to the

Department’s proposal also attack the

scientific basis of the conclusion that

the Department and NIOSH have drawn

from the evidence of record. In the

following discussion, where a scientific

article or treatise is cited, the

Department has also cited to a

Rulemaking Record Exhibit or, when

appropriate, the Federal Register, where

that source appears. This second

citation is not an exhaustive list; thus,

each source may appear at additional

points in the Rulemaking Record. In

support of their attack, the commenters

have submitted an analysis of the

available medical literature from Dr.

Gregory Fino, a Board-certified

physician in Internal Medicine and

Pulmonary Disease, and Dr. Barbara

Bahl, who has a doctorate in nursing

and biostatistics. Drs. Fino and Bahl

analyze nine articles and textbooks

dealing with latency, which they define

parenthetically as ‘‘0/0 or 0/1 to 1/0+.’’

The analysis thus focuses on evidence

that would show that a miner whose

chest X-rays are classified by a

radiologist as ‘‘negative’’ (0/0 or 0/1

under the ILO–UC classification

scheme, see 20 CFR 718.102(b)), after he

leaves the mine can develop a disease

that will result in chest X-rays that are

classified as ‘‘positive.’’ Under the ILO–

UC scheme, an X-ray classified as

category 1, 2, or 3, ranging from 1/0 to

3/3, is considered positive for simple

pneumoconiosis. An X-ray classified as

A, B, or C is considered positive for

complicated pneumoconiosis, also

known as progressive massive fibrosis

or massive pulmonary fibrosis. 20 CFR

718.102(b), 718.304(a) (1999). They

conclude that ‘‘the medical literature

provides no evidence that coal workers’

pneumoconiosis or silicosis in

coalminers is a latent disease. There is

also no evidence to show that the

development of pulmonary impairment

is latent.’’ Rulemaking Record, Exhibit,

89–37, Appendix C at 29.

Drs. Fino and Bahl also analyzed five

articles dealing with progression, which

they define parenthetically as ‘‘1/0 to

1/0.+’’ Their analysis of progression

thus focuses on whether individuals

whose chest X-rays are initially read as

1/0, the lowest positive classification in

the ILO–UC scheme, may have later

chest X-rays classified greater than 1/0.

They observe that ‘‘there are authors

who have identified progression of

pneumoconiosis in coal miners,’’ but

that other authors have reached the

contrary conclusion. They conclude as

follows:

Why do some miners progress within the

ILO scale of simple pneumoconiosis and

others do not? The answer lies in the proper

definition of pneumoconiosis. Careful

attention must be made to differentiate

simple coal workers’ pneumoconiosis and

silicosis. The miners who have been

described to progress over time after

exposure ceases are miners who have likely

contracted silicosis, not simple coal workers’

pneumoconiosis. * * *

Silicosis may be a progressive disease in a

small percentage of miners after coal mine

dust exposure ends. The literature does not

support the statement that coal workers’

pneumoconiosis is progressive absent further

dust exposure. There are no studies that

show progressive impairment in miners who

have left the mines. The studies do not show

any progression in industrial bronchitis after

a miner leaves the mines. In fact, the studies

do suggest that the minor reduction in the

FEV1 [Forced Expiratory Volume in one

second] as a result of industrial bronchitis

occurs in the first few years of mining and

then the effect over the remaining years in

the mines is negligible and may even recover.

Rulemaking Record, Exhibit 89–37,

Appendix C at 30–31. In evaluating the

medical evidence contained in the

rulemaking record, the Department is

mindful that Congress provided an

exceptionally broad definition of the

term ‘‘pneumoconiosis:’’ ‘‘a chronic

dust disease of the lung and its

sequelae, including respiratory and

pulmonary impairments, arising out of

coal mine employment.’’ 30 U.S.C.

902(b). The regulatory definitions

promulgated by the Department over the

last 25 years have reflected the scope of

this provision.

In 1978, the Department promulgated

its interim criteria, 20 CFR Part 727.

Those criteria included a definition of

‘‘pneumoconiosis’’ at 20 CFR 727.202.

After repeating the statutory definition,

the regulation further provided that

‘‘[t]his definition includes, but is not

limited to, coal workers’

pneumoconiosis, anthracosilicosis,

anthracosis[,]anthrosilicosis, massive

pulmonary fibrosis, progressive massive

fibrosis[,] silicosis, or silicotuberculosis

arising out of coal mine employment.’’

43 FR 36825 (Aug. 18, 1978). The

Department promulgated its permanent

criteria, 20 CFR Part 718, in 1980.

Section 718.201, entitled ‘‘Definition of

pneumoconiosis,’’ contained a

definition that was identical to that of

§ 727.202. 45 FR 13685 (Feb. 29, 1980).

The federal courts of appeals have long

recognized that the Act compensates not

merely coal workers’ pneumoconiosis,

as that term is used by the medical

community, but ‘‘legal’’

pneumoconiosis. See, e.g., Peabody Coal

Co. v. Lowis, 708 F.2d 266, 268 n.4 (7th

Cir. 1983) (‘‘the ‘legal’ definition of

pneumoconiosis contained in the abovequoted regulation [§ 727.202] includes

not only ‘true or clinical’

pneumoconiosis but also other

respiratory or pulmonary diseases

arising from dust exposure in coal mine

employment’’); Gulf & Western

Industries v. Ling, 176 F.3d 226, 231

(4th Cir. 1999) (‘‘[the regulations detail

the breadth of what is frequently called

79970 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

‘legal’ pneumoconiosis * * *’’); see also

the Department’s preamble to § 718.201.

The Department has reviewed all of

the medical literature referenced in the

record, and does not agree that it lacks

support for the proposition that

pneumoconiosis is a latent, progressive

disease. Contrary to Dr. Fino’s

conclusions, a number of medical

references document the latent,

progressive nature of the disease. For

example, Seaton, in ‘‘Coal Workers’

Pneumoconiosis,’’ in Morgan, WKC and

Seaton A, eds., Occupational Lung

Diseases (WB Saunders Co., 3d ed.

1995) 389, see also Rulemaking Record,

Exhibit 89–37, Appendix C at 34, 42,

contains the observation that ‘‘PMF

[Progressive massive fibrosis] may occur

after dust exposure has ceased, even

when the miner has left the industry

with no apparent simple

pneumoconiosis, although this will only

occur if the worker has had substantial

dust exposure’’). Similarly, National

Institute for Occupational Safety and

Health, Criteria for a Recommended

Standard: Occupational Exposure to

Respirable Coal Mine Dust, § 4.2.1.3.1,

Rulemaking Record, Exhibit 2–1 at 48,

summarized an article (Maclaren WM,

Soutar CA, ‘‘Progressive massive fibrosis

and simple pneumoconiosis in exminers,’’ Br. J. Ind. Med. 42:734–740

(1985)) as follows: ‘‘Among 1,902 exminers who had not developed PMF

within 4 years of leaving mining, 172

(9%) developed PMF after leaving

mining. Of those 172 miners with PMF,

32% had no evidence of simple CWP

(category 0) when they left mining.’’ In

that article, in fact, Maclaren and Soutar

reported both small opacities (evidence

of simple pneumoconiosis) and large

opacities (evidence of complicated

pneumoconiosis) in ex-miners who did

not show evidence of coal workers’

pneumoconiosis after the miners left the

industry.

Moreover, contrary to the conclusion

of Dr. Fino and Dr. Bahl, the study

conducted by Donnan et al. did find

significant evidence of latency. Donnan

PT, Miller BG, Scarisbrick DA, Seaton

A, Wightman AJA, Soutar CA,

‘‘Progression of simple pneumoconiosis

in ex-coalminers after cessation of

exposure to coalmine dust,’’ IOM report

TM/97/07 (Institute of Occupational

Medicine, December 1997) 1–67, see

also Rulemaking Record, Exhibit 89–37,

Appendix C at 26, 29. Dr. Fino and Dr.

Bahl write that ‘‘only one out of 200

miners [in the study] was found to

progress from a negative to a positive

film.’’ That conclusion, however, was

not the conclusion of the study’s

authors. Their tables 3.4a (Median

profusion score for 14 CWP progressors

and 19 PMF progressors) and 3.4b

(Median profusion score for 161 CWP

non-progressors) compare X-rays taken

within two years of the dates on which

the 200 miners left the coal mining

industry with X-rays taken 10 years

later. They demonstrate that of 138 exminers whose early X-rays were read as

0/0 or 0/1, 11 had later X-rays read as

positive for either simple or

complicated pneumoconiosis. This

proportion, 7.97%, has epidemiologic

significance, and supports the authors’

conclusion that ‘‘[t]he results have

demonstrated that progression does

occur after cessation of exposure.’’

Donnan et al. at 23.

In light of this evidence, the

Department is not persuaded by the

reliance Dr. Fino and Dr. Bahl place on

the conclusion of Drs. Merchant, Taylor

and Hodous in ‘‘Occupational

Respiratory Diseases’’ (National Institute

for Occupational Safety and Health,

1986), see also Rulemaking Record,

Exhibit 89–37, Appendix C at 26. Dr.

Fino and Dr. Bahl quote the textbook’s

statement that ‘‘the chance of

radiological progression over ten years

at a mean dust concentration of 2

milligrams per cubic meter is essentially

zero for a miner with x-ray category 0/

0.’’ This textbook was published by the

Division of Respiratory Disease Studies

of the Appalachian Laboratory for

Occupational Safety and Health, a

component of the National Institute of

Occupational Safety and Health, more

than 10 years prior to the Donnan study.

In light of NIOSH’s conclusion that

scientific analysis supports the

Department’s regulations, the

Department does not agree that the

statement by Merchant et al. requires

the Department to revise its regulatory

approach.

Similarly, the Department is not

persuaded by Dr. Fino and Dr. Bahl’s

attempt to dismiss the effect of silica on

coal miners, and therefore to discount

the applicability of studies

demonstrating the latency and

progressivity of silicosis. It remains the

Department’s position that

pneumoconiosis, as defined in the

statute, 30 U.S.C. 902(b), is both latent

and progressive. The statutory

definition includes both simple coal

workers’ pneumoconiosis and silicosis.

Although they acknowledge studies

showing that silicosis is a latent,

progressive disease, Dr. Fino and Dr.

Bahl argue that coal workers’

pneumoconiosis must be distinguished

from silicosis. The Black Lung Benefits

Act, however, does not permit such a

distinction. As discussed above, the

regulatory definition of the term

‘‘pneumoconiosis,’’ implementing the

broad statutory definition, includes

silicosis within the list of conditions

that must be considered

pneumoconiosis. In addition, inclusion

of silicosis in the definition of

pneumoconiosis is based on practical as

well as legal considerations. It is

difficult to separate the effects of coal

and silica in the occupational setting.

Coal contains a number of non-organic

materials, including quartz, and the

percentage of quartz is greater in high

rank coals. Seaton, ‘‘Coal Workers’

Pneumoconiosis,’’ in Morgan, WKC and

Seaton A, eds., Occupational Lung

Diseases (WB Saunders Co., 3d ed.

1995) 389, see also Rulemaking Record,

Exhibit 89–37, Appendix C at 34, 42.

Seaton and colleagues reported a cohort

of miners who had a rapid progression

of radiologic findings resembling

silicosis, despite a relatively low total

coal dust exposure. Seaton A, Dick JA,

Dodgson J, Jacobsen M., ‘‘Quartz and

pneumoconiosis in coal miners,’’ Lancet

2:1272 (1981), see also Rulemaking

Record, Exhibit 2–1 at 50. Analysis

revealed that the percentage of quartz in

the mixed coal mine dust was

significantly higher in these affected

miners than in matched controls. They

concluded that quartz exposure was an

important factor contributing to

pneumoconiosis in some miners and

that disease in such miners was more

aggressive. Moreover, miners who drill

into hard rock, such as those who bore

shafts or work as roof bolters, are

exposed to higher concentrations of

quartz and are known to be at higher

risk for developing silicosis. Seaton,

‘‘Coal Workers’ Pneumoconiosis,’’ in

Morgan, WKC and Seaton A, eds.,

Occupational Lung Diseases (WB

Saunders Co., 3d ed. 1995) 389, see also

Rulemaking Record, Exhibit 89–37,

Appendix C at 34, 42. Based on these

observations, it is reasonable to

conclude that there is a clear risk of

developing pneumoconiosis with

characteristics of silicosis in coal miners

exposed to dusts with high quartz

content. Accordingly, the Department

believes that it may properly rely on

studies of silicosis in promulgating

regulations governing the

compensability of pneumoconiosis as

that term has been defined by Congress.

See also Beckett WS, ‘‘Occupational

Respiratory Diseases,’’ The New

England Journal of Medicine, 342:406–

13 (Feb. 12, 2000) (citing a study of

silicosis to support the conclusion that

‘‘[w]ith many substances (including coal

and silica dust), the disease may

progress for decades after the exposure

has ceased.’’). (Dr. Beckett’s review

article did not appear until after the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79971

rulemaking record had closed; it is cited

only as additional evidence confirming

the Department’s previous use of studies

involving silicosis).

Finally, there is also evidence that

lung function can continue to

deteriorate after a miner leaves the coal

mining industry. The authors of DimichWard H and Bates DV, ‘‘Reanalysis of a

longitudinal study of pulmonary

function in coal miners in Lorraine,

France,’’ Am J Ind Med, 25:613–623

(1994), see also 62 FR 3344 (Jan. 22,

1997), demonstrated a decline of

pulmonary function in both smoking

and non-smoking coal miners that

continues over time even after

retirement from mining. Given this

evidence of progression, it is clear that

a miner who may be asymptomatic and

without significant impairment at

retirement can develop a significant

pulmonary impairment after a latent

period. Because the legal definition of

‘‘pneumoconiosis’’ includes

impairments that arise from coal mine

employment, regardless of whether a

miner shows X-ray evidence of

pneumoconiosis, this evidence of

deterioration of lung function among

miners, including miners who did not

smoke, is particularly significant.

The commenters also cite the 1985

report of the Surgeon General, U.S.

Department of Health and Human

Services, The Health Consequences of

Smoking: Cancer and Chronic Lung

Disease in the Workplace (1985), see

also Rulemaking Record, Exhibit 89–21,

Appendix 11, in support of their

argument. Of the seven items listed in

the ‘‘Summary and Conclusions’’

section of Chapter Seven, ‘‘Respiratory

Disease in Coal Miners,’’ none addresses

the latency or progressivity of

pneumoconiosis. In addition, the

Surgeon General’s report, which focused

on the health consequences of smoking,

did not review many of the articles on

which the Department’s conclusion is

based. Because the overwhelming

majority of the references cited by the

Department in its first and second

notices of proposed rulemaking, see 62

FR 3343–44 (Jan. 22, 1997); 64 FR

54978–79 (Oct. 8, 1999), as well as the

references discussed above, were

prepared after 1985, this is not

surprising. Accordingly, the Department

does not believe that anything in the

Surgeon General’s report requires the

Department to ignore the conclusions

that it has drawn from the studies and

articles in the rulemaking record.

Contrary to the commenters’

argument, then, the record does contain

abundant evidence demonstrating that

pneumoconiosis is a latent, progressive

disease. That evidence is certainly

sufficient to justify the Department’s

regulation governing subsequent claims.

Moreover, neither the regulation

permitting subsequent claims nor the

Department’s explicit recognition of the

progressive nature of the disease

represents a departure from the

Department’s prior positions. The

Department’s original promulgation of a

regulation governing subsequent claims

in 1978 was based on the progressive

nature of the disease. 43 FR 36785 (Aug.

18, 1978). The federal courts of appeals

have also recognized that

pneumoconiosis is a progressive

disease. Plesh v. Director, OWCP, 71

F.3d 103, 108 (3d Cir. 1995)

(‘‘pneumoconiosis is progressive and

incurable’’); Labelle Processing Co. v.

Swarrow, 72 F.3d 308, 314–315 (3d Cir.

1995) (‘‘Congress, in enacting the BLBA,

recognized the perniciously progressive

nature of the disease * * *. Moreover,

courts have long acknowledged that

pneumoconiosis is a progressive and

irreversible disease.’’); Kowalchick v.

Director, OWCP, 893 F.2d 615, 621 (3d

Cir. 1990) (‘‘That the three earliest xrays of record * * * were read negative

is not inconsistent with the progressive

nature of pneumoconiosis.’’); Shendock

v. Director, OWCP, 893 F.2d 1458, 1467

n.10 (3d Cir. 1990) (‘‘it is well

recognized that pneumoconiosis is a

progressive disease whose symptoms

increase in severity over time’’);

Bethenergy Mines Inc. v. Director,

OWCP, 854 F.2d 632, 636 (3d Cir. 1988)

(‘‘Due to the progressive nature of

pneumoconiosis, a coal mine operator is

less likely to know the details

underlying a particular claim than an

employer is in the typical case arising

under the LHWCA.’’); Zielinski v.

Califano, 580 F.2d 103, 107 (3d Cir.

1978) (‘‘pneumoconiosis and related

lung diseases progress slowly’’); Eastern

Associated Coal Corp. v. Director,

OWCP, ll F.3d ll, No. 99–1312,

slip op. at pp. 11–12 (4th Cir. July 12,

2000) (observing ‘‘the assumption of

progressivity that underlies much of the

statutory regime’’); Lane Hollow Coal

Co. v. Lockhart, 137 F.3d 799, 803 (4th

Cir. 1998) (‘‘pneumoconiosis is

progressive and irreversible’’); Adkins v.

Director, OWCP, 958 F.2d 49, 51 (4th

Cir. 1992) (‘‘pneumoconiosis is a

progressive disease’’); Greer v. Director,

OWCP, 940 F.2d 88, 90 (4th Cir. 1991)

(pneumoconiosis is ‘‘a slowlyprogressing condition’’); Hamrick v.

Schweiker, 679 F.2d 1078, 1081 (4th Cir.

1982) (‘‘pneumoconiosis is a progressive

disease’’); Prater v. Harris, 620 F.2d

1074, 1082 (4th Cir. 1980)

(‘‘pneumoconiosis is a progressive

disease’’); Barnes v. Mathews, 562 F.2d

278, 279 (4th Cir. 1977)

(‘‘pneumoconiosis is a slow, progressive

disease often difficult to diagnose at

early stages’’); Crace v. KentlandElkhorn Coal Corp., 109 F.3d 1163, 1167

(6th Cir. 1997) (‘‘because of the

progressive nature of pneumoconiosis,

more recent evidence is often accorded

more weight’’); Consolidation Coal Co.

v. McMahon, 77 F.3d 898, 906 (6th Cir.

1996) (recognizing ‘‘the progressive

nature of pneumoconiosis’’);

Sharondale Corp. v. Ross, 42 F.3d 993,

997 (6th Cir. 1994) (‘‘the material

change provision [provides] relief from

the principles of finality for those

miners whose conditions have

deteriorated due to the progressive

nature of black lung disease’’); Johnson

v. Peabody Coal Co., 26 F.3d 618, 620

(6th Cir. 1994) (‘‘Pneumoconiosis is a

progressive debilitating disease.’’);

Woodward v. Director, OWCP, 991 F.2d

314, 320 (6th Cir. 1993)

(‘‘Pneumoconiosis is a progressive and

degenerative disease.’’); Campbell v.

Consolidation Coal Co., 811 F.2d 302,

303 (6th Cir. 1987) (recognizing ‘‘the

progressive nature of pneumoconiosis’’);

Back v. Director, OWCP, 796 F.2d 169,

172 (6th Cir. 1986) (‘‘Because of the

progressive nature of pneumoconiosis,

earlier negative and later positive X-rays

of the same individual are not

necessarily in conflict.’’); Orange v.

Island Creek Coal Co., 786 F.2d 724, 727

(6th Cir. 1986) (‘‘pneumoconiosis * * *

is a progressive disease’’); Director,

OWCP v. Bivens, 757 F.2d 781, 788 (6th

Cir. 1985) (‘‘the Black Lung Benefits Act

provides compensation for disability

based on an invisible and progressive

disease’’); Collins v. Sec’y of HHS, 734

F.2d 1177, 1180 (6th Cir. 1984)

(‘‘Medically we note that

pneumoconiosis is a slow, progressive

disease. Its characteristics and

symptoms often do not manifest

themselves in a way that promote [sic]

immediate detection. In some cases the

disease may take years before it is

readily detectable.’’); Smith v. Califano,

682 F.2d 583, 587 (6th Cir. 1982) (‘‘coal

workers’’ pneumoconiosis * * * is a

progressive disease’’); Hill v. Califano,

592 F.2d 341, 345 (6th Cir. 1979)

(‘‘pneumoconiosis is a slowly

progressive disease’’); Morris v.

Mathews, 557 F.2d 563, 568 (6th Cir.

1977) (recognizing Congressional

finding that ‘‘pneumoconiosis [is] a

progressive chronic dust disease of the

lung’’); Begley v. Mathews, 544 F.2d

1345, 1354 (6th Cir. 1976) (describing

pneumoconiosis as ‘‘a disease known to

be of a slowly progressive character’’);

Amax Coal Co. v. Franklin, 957 F.2d

355, 359 (7th Cir. 1992) (‘‘Black lung

79972 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

disease, at least when broadly defined,

is a progressive disease * * *.’’); Dotson

v. Peabody Coal Co., 846 F.2d 1134,

1139 (7th Cir. 1988) (‘‘Pneumoconiosis

is a progressive disease* * *’’.); Russell

v. Director, OWCP, 829 F.2d 615, 616

(7th Cir. 1987) (‘‘Coal miners’’

pneumoconiosis (black lung) is a

progressive, debilitating disease.’’);

Amax Coal Co. v. Director, OWCP, 801

F.2d 958, 964 (7th Cir. 1986)

(recognizing ‘‘the difficulty of clinically

diagnosing the progressive disease’’);

Consolidation Coal Co. v. Chubb, 741

F.2d 968, 973 (7th Cir. 1984) (‘‘In light

of the progressive nature of

pneumoconiosis, [the ALJ’s] according

greater weight to the recent x-ray was

not irrational.’’); Lovilia Coal Co. v.

Harvey, 109 F.3d 445, 450 (8th Cir.

1997) (recognizing progressive nature of

pneumoconiosis); Robinson v. Missouri

Mining Co., 955 F.2d 1181, 1184 (8th

Cir. 1992) (‘‘pneumoconiosis is a

progressive disease’’); Campbell v.

Director, OWCP, 846 F.2d 502, 509 (8th

Cir. 1988) (‘‘pneumoconiosis is a

progressive disease’’); Newman v.

Director, OWCP, 745 F.2d 1162, 1165

(8th Cir. 1984) (‘‘pneumoconiosis is a

progressive disease’’); Padavich v.

Mathews, 561 F.2d 142, 146 (8th Cir.

1977) (‘‘Pneumoconiosis is a progressive

illness* * *.’’); Humphreville v.

Mathews, 560 F.2d 347, 349 (8th Cir.

1977) (‘‘pneumoconiosis is a progressive

disease’’); Wyoming Fuel Co. v. Director,

OWCP, 90 F.3d 1502, 1507 (10th Cir.

1996) (recognizing ‘‘the nature of

pneumoconiosis as a disease that

develops progressively and is difficult

to diagnose’’); Lukman v. Director,

OWCP, 896 F.2d 1248, 1253 (10th Cir.

1990) (recognizing real purpose of

duplicate claims regulation is to provide

‘‘miners with progressively worsening

health full and equal access to black

lung benefits.’’); Ohler v. Sec’y of HEW,

583 F.2d 501, 506 (10th Cir. 1978)

(‘‘pneumoconiosis is a progressive

disease, as is emphysema’’); Paluso v.

Mathews, 573 F.2d 4, 10 (10th Cir. 1978)

(‘‘It is well-established medically that

pneumoconiosis is a progressive disease

which frequently defies diagnosis.’’);

Alabama Dry Dock and Shipbuilding

Corp. v. Sowell, 933 F.2d 1561, 1566

(11th Cir. 1991) (black lung ‘‘can lie

essentially dormant in the body for

many years after an employee has left

his employment before progressing to

the point where [it] is disabling’’); Curse

v. Director, OWCP, 843 F.2d 456, 457

(11th Cir. 1988) (recognizing black lung

disease develops slowly and

progressively); Doss v. Califano, 598

F.2d 419, 421 (11th Cir. 1979)

(‘‘pneumoconiosis is a progressive

disease’’); 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 evidence in

the record to support the assumption).

Although one commenter asserts that

the regulation creates an irrebuttable

presumption that each miner’s

condition is progressive, it actually does

no such thing. As revised, § 725.309

simply effectuates the current oneelement test adopted by a substantial

number of federal appellate courts and

most recently the Benefits Review

Board, Allen v. Mead Corp., ll Black

Lung Rep. (MB) ll, BRB No. 99–0474

BLA (May 31, 2000). The one-element

test allows a miner who demonstrates a

material change in one of the conditions

of entitlement previously decided

against him to avoid an automatic bar

on establishing his current entitlement

to benefits. To the extent that the

commenter would require each miner to

submit scientific evidence establishing

that the change in his specific condition

represents latent, progressive

pneumoconiosis, the Department

disagrees and has therefore not imposed

such an evidentiary burden on

claimants. Rather, the miner continues

to bear the burden of establishing all of

the statutory elements of entitlement,

except to the extent that he is aided by

two statutory presumptions, 30 U.S.C.

921(c)(1) and (c)(3). The revised

regulation continues to afford coal mine

operators an opportunity to introduce

contrary evidence weighing against

entitlement.

(c) One comment submitted in

connection with the first notice of

proposed rulemaking, and cited by

another comment submitted in

connection with the second notice of

proposed rulemaking, suggests that the

Department’s proposed revision would

compensate the 15 to 20 percent of

cigarette smokers who develop chronic

airway obstruction if they spent 10 years

or more in the coal mining industry.

The Department does not agree that the

possibility that miners will suffer

reduced pulmonary function as a result

of cigarette smoking justifies the

automatic denial of additional claims by

miners under § 725.309. In addition, the

previously cited study by Dimich-Ward

and Bates documented the progressive

decrement in lung function among both

miners who smoked and those who did

not. Dimich-Ward H, Bates DV,

‘‘Reanalysis of a longitudinal study of

pulmonary function in coal miners in

Lorraine, France,’’ Am J Ind Med,

25:613–623 (1994), see also 62 FR 3344

(Jan. 22, 1997). The Department

accordingly believes that a miner who

files his first claim before he is truly

totally disabled, but later becomes

totally disabled, must be afforded an

opportunity to establish that his

condition is related to his coal mine

employment. Under § 718.204, the

miner continues to bear the burden of

proving this element of his entitlement.

To the extent that a coal mine operator

produces medical evidence

demonstrating that the miner’s total

disability is due solely to cigarette

smoking, that evidence would also be

relevant to the inquiry under § 718.204.

(d) A number of comments argue that

§ 725.309 violates accepted principles of

claim preclusion and issue preclusion,

particularly with respect to the

treatment of additional claims filed by

miners’ survivors. The Department

disagrees. In its initial proposal, the

Department explained that its additional

filing rules gave full effect to the

principles of claim preclusion but that

the applicability of these principles was

limited in two important respects: (1)

The liberal reopening provision created

by Congress under § 22 of the Longshore

and Harbor Workers’ Compensation Act,

33 U.S.C. 922, incorporated into the

Black Lung Benefits Act by 30 U.S.C.

932(a); and (2) the recognition that an

individual’s eligibility for workers’

compensation benefits is not fixed at a

single time, but, especially with respect

to occupational diseases, may be subject

to relitigation even if the worker’s first

claim is denied. 62 FR 3352 (Jan. 22,

1997). Under these principles, and

subject to the limitation that the party

must have a full and fair opportunity to

litigate its position, Kremer v. Chemical

Constr. Corp., 456 U.S. 461, 481 n. 22

(1982), a final adjudication of the merits

of a cause of action will preclude the

parties from relitigating issues that were

or could have been raised in the first

proceeding. Rivet v. Regions Bank of

Louisiana, 522 U.S. 470, 476 (1998),

citing Federated Department Stores, Inc.

v. Moitie, 452 U.S. 394, 398 (1981).

Section 725.309 applies these

principles to the adjudication of black

lung benefits claims. For example, if the

sole basis for denying a miner’s claim is

a finding on an issue that is not subject

to change, and that the miner had an

opportunity to fully and fairly litigate, a

subsequent claim by the miner must

also be denied. Thus, where the first

claim was denied solely on the grounds

that the applicant did not work as a

miner, and he does not allege that he

engaged in any additional coal mine

employment since he filed that

application, his second claim must be

denied as well. Where the issue is

subject to change, however, neither

claim preclusion principles nor

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79973

§ 725.309 bars the litigation of the

miner’s additional claim. For example,

where the original denial was based on

the miner’s failure to establish that his

respiratory impairment was totally

disabling, and new evidence establishes

that that condition has worsened, the

miner should not be barred from

prosecuting a second application for

benefits.

The regulation gives similar treatment

to cases involving miners’ survivors.

Where a previous survivor’s claim was

denied solely on the basis that the

survivor did not prove that the miner

died due to pneumoconiosis, an element

not subject to change, the survivor may

be barred from litigating another claim

filed more than one year after the denial

of the first one. The Department does

not agree, however, with the

commenters’ suggestion that none of the

elements of a survivor’s claim is subject

to change. In the case of a miner’s

survivor, for example, the Secretary’s

regulations recognize, consistent with

Departmental practice, court of appeals

precedent, and applicable Social

Security law, that although a miner’s

survivor who remarries is not then

eligible for benefits, she may become reentitled to benefits if that marriage ends.

See preamble to § 725.213. Section

725.309 recognizes this possibility by

allowing a miner’s survivor to litigate a

second claim where one of the grounds

on which the first claim was denied,

e.g., that the survivor was married, is

subject to change.

Moreover, § 725.309 incorporates two

other limitations which are accepted

components of traditional claim

preclusion. First, where none of the

elements is subject to change, and

denial by virtue of claim preclusion is

appropriate under § 725.309, the

regulation requires the party defending

the claim to specifically plead that

doctrine. The Supreme Court has

observed that ‘‘[c]laim preclusion (res

judicata), as Rule 8(c) of the Federal

Rules of Civil Procedure makes clear, is

an affirmative defense.’’ Rivet, 522 U.S.

at 476. Section 725.309 similarly

requires an operator seeking the denial

of an additional survivor’s claim by

virtue of preclusion to raise that issue at

the appropriate time. Like traditional

claim preclusion, § 725.309 offers the

party defending the cause of action an

affirmative defense that is subject to

waiver if not properly and timely raised.

See, e.g., Garry v. Geils, 82 F.3d 1362,

1367 n. 8 (7th Cir.1996).

Second, claim preclusion is

inappropriate even in traditional civil

litigation where the party against whom

the defense is invoked was not able to

fully litigate those issues which the

defendant now seeks to bar. Kremer, 456

U.S. at 481 n. 22. For example, this

issue would arise if the administrative

law judge adjudicating the survivor’s

first claim found that the survivor’s

remarriage barred her entitlement, and

alternatively concluded that the miner

did not die due to pneumoconiosis. In

that case, the survivor could not have

overturned the adverse finding on the

cause of the miner’s death because she

would not have been able to avoid the

prohibition on the eligibility of

remarried widows. Accordingly, she

could not be said to have had a full and

fair opportunity to litigate the issue of

the cause of the miner’s death. In these

circumstances, neither ordinary

principles of claims preclusion nor

§ 725.309 would preclude her from

litigating her entitlement to benefits in

a subsequent claim.

Similarly, the Department’s

application of claim preclusion to

additional claims contains an exception

based on the absence of an opportunity

to fully and fairly litigate the issues in

a previous proceeding. As the

Department explained in its second

notice of proposed rulemaking, where

one of the applicable conditions of

entitlement has changed, e.g., where the

miner has become totally disabled or a

survivor has ended her second marriage,

neither the party defending against the

claim—the coal mine operator or the

Trust Fund—nor the claimant is entitled

to rely on findings made in connection

with the denial of an earlier claim for

benefits. 64 FR 54985 (Oct. 8, 1999).

One commenter’s suggestion that an

administrative law judge’s

determination in the original proceeding

that an X-ray is not worthy of credit

precludes any further litigation of that

issue in a subsequent proceeding simply

reflects a misunderstanding of the tenets

of issue preclusion. Where that finding

was not essential to the original denial

of benefits, because the ALJ ultimately

denied benefits on another basis, or

used alternative bases, issue preclusion

would not prevent a second factfinder

from making a different finding, based

on his independent weighing of the

evidence, in connection with an

additional claim.

(e) One comment opposes the revised

version of § 725.309, suggesting it

represents a revised application of the

common law concept of claim

preclusion to adjudications under the

Act. In fact, however, with one

exception in the case of survivors’

entitlement, the revised version of

section 725.309 functions no differently

than the former regulation with respect

to this common law doctrine. As the

Department observed in its initial

proposal, its ‘‘one-element’’ rule,

allowing a miner to avoid claim

preclusion by establishing one of the

conditions of entitlement decided

against him in the previous

adjudication, derives from a series of

appellate decisions adopting the

Department’s interpretation of the

former regulation. See 62 FR 3351 (Jan.

22, 1997); see also 64 FR 54984 (Oct. 8,

1999). The provision requiring the

denial of survivors’ claims is also

substantially the same as the former

rule. Like the revised version, the

former rule was subject to waiver just as

any other affirmative defense would be

under common law. See Clark v.

Director, OWCP, 838 F.2d 197, 200 (6th

Cir. 1988) (permitting the Director to

waive reliance on section 725.309). The

provision governing additional

survivors’ claims has been altered only

in order to accommodate revisions to

section 725.213, which will explicitly

permit a remarried survivor to establish

her entitlement to benefits upon ending

her marriage. Accordingly, the

Department does not agree that it has

substantially revised the applicability of

the common law doctrine of claim

preclusion under the Black Lung

Benefits Act.

(f) One comment argues that the oneelement test codified by the revised

regulation violates the principles of

issue preclusion. The commenter

suggests that an X-ray that is found not

to be credible in an earlier adjudication

may not be credited in a subsequent

adjudication. Common law principles of

issue preclusion, however, do not

require such a result. Instead, once a

claimant has submitted new evidence in

order to establish one of the elements of

entitlement previously resolved against

him, an administrative law judge must

conduct a de novo weighing of the

evidence relevant to the remaining

elements, regardless of whether any of

that evidence is newly submitted. The

Court of Appeals for the Seventh Circuit

discussed this issue at length in

Peabody Coal Co. v. Spese, 117 F.3d

1001 (7th Cir. 1997) (en banc). It held

as follows:

The law of preclusion also bars relitigation

of issues between the same parties when

those issues were actually litigated and

necessary to the decision of the earlier

tribunal. See Astoria Fed. Sav. & Loan Ass’n

v. Solimino, 501 U.S. 104, 107, 111 S.Ct.

2166, 2169, 115 L.Ed.2d 96 (1991)

(preclusion applies to administrative agency

acting in judicial capacity to resolve fact

issues properly before it); United States v.

Wyatt, 102 F.3d 241, 245 n. 5 (7th Cir. 1996),

cert. denied, l U.S. l, 117 S.Ct. 1325, 137

L.Ed.2d 486 (1997); Waid v. Merrill Area

79974 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Public Schools, 91 F.3d 857, 866 (7th Cir.

1996) (state agency hearing). * * *

* * * * *

[The Fourth Circuit, in Lisa Lee Mines v.

Director, OWCP, 86 F.3d 1358 (4th Cir. 1996)

(en banc), cert. denied, 519 U.S. 1090 (1997)]

pointed out, correctly, that a claimant who

loses on three possible alternate grounds has

no incentive to take an appeal to ‘‘correct’’

the agency on grounds 2 and 3, even if he

thinks there was error, if ground 1 is

unassailable. Assuming that the passage of

time has led to a material change in ground

1 and he can demonstrate this to the Director,

the question is whether he should be barred

from proceeding on a new claim just because

he has not also developed new evidence to

negate grounds 2 and 3. Under the Director’s

‘‘one-element’’ approach, as endorsed by the

Fourth Circuit and others, * * * the answer

is no. This answer is consistent with general

principles of issue preclusion, under which

holdings in the alternative, either of which

would independently be sufficient to support

a result, are not conclusive in subsequent

litigation with respect to either issue

standing alone. See Lisa Lee Mines, 86 F.3d

at 1363, citing Restatement (Second) of

Judgments § 27, comment i (1982); Comair

Rotron, Inc. v. Nippon Densan Corp., 49 F.3d

1535, 1538 (Fed. Cir. 1995) (issue on which

preclusion is sought must have clearly been

necessary to judgment); Baker Elec. Co-op.,

Inc. v. Chaske, 28 F.3d 1466, 1475 (8th Cir.

1994); Gelb v. Royal Globe Insur. Co., 798

F.2d 38, 45 n. 6 (2d Cir. 1986).

117 F.3d at 1008.

The commenter’s example, an X-ray

that is found not to be credible in the

previous adjudication, illustrates the

operation of the regulation. If the prior

claim was denied solely on the basis

that the miner failed to establish the

existence of pneumoconiosis, the

commenter’s concern about a reweighing of the X-ray evidence

submitted in the prior adjudication is

simply unfounded. Because this was the

only issue resolved against the claimant,

he must introduce new evidence that

demonstrates the existence of the

disease if he is to avoid an automatic

denial of an additional claim.

Consequently, the factfinder may not

award benefits simply by redetermining

the credibility of the earlier evidence. In

most cases, however, the denial of the

prior claim will rest on multiple

findings. For example, an administrative

law judge may conclude that the

claimant has not established either that

he suffers from pneumoconiosis or that

he suffers from a totally disabling

respiratory impairment. In such a case,

the Department’s regulation, consistent

with the principles of issue preclusion

set forth in Spese, requires that the

claimant submit new evidence relevant

only to one of the issues. If he submits

new evidence that establishes his total

disability, the factfinder must weigh the

X-ray evidence de novo. Far from

contravening accepted principles of

issue preclusion, the Department’s

regulation gives those principles full

force and effect. The commenter’s

suggestion, that a party must be bound

by a credibility determination that it

was unable to overturn on appeal, turns

those principles on their head.

(g) One comment suggests that the

Department would breach its fiduciary

duty to the Black Lung Disability Trust

Fund in any case in which it

affirmatively waived its right to rely on

the automatic denial of an additional

survivor’s claim. The Department’s

obligation to the Trust Fund is to ensure

that the Fund not be required to pay

non-meritorious claims, i.e., that the

Trust Fund does not pay benefits to

individuals who do not meet the

statutory eligibility criteria. Where

appropriate, the Department will invoke

the automatic denial provision in order

to reduce the transaction costs that the

Fund would incur in defending a nonmeritorious survivor’s claim. The

Department does not believe, however,

that it is obligated to invoke claim

preclusion in order to bar a claim in

which a surviving spouse meets all of

the conditions of entitlement and

simply erred in filing a first application

while remarried.

(h) One comment suggests that the

Department should penalize individuals

who file an additional claim without a

change in condition. The Department

disagrees. In its second notice of

proposed rulemaking, the Department

announced its desire to reduce the costs

associated with non-meritorious claims

by providing applicants with a more

realistic view of their possible

entitlement based on better pulmonary

evaluations and better reasoned

explanations of the denials of their

claims. 64 FR 54968, 54984 (Oct. 8,

1999). The Department also explained,

however, that it did not believe that it

was appropriate to penalize an

applicant simply because he had filed a

previous claim for benefits prematurely.

Id. The complete pulmonary evaluation

provided by the Department includes

difficult tests, and the Department does

not believe that a miner would

deliberately subject himself to that

testing if he did not truly believe that he

met the Act’s eligibility criteria.

Moreover, preventing a miner from

filing an additional claim merely on the

grounds that a previous additional claim

was denied may result in the denial of

benefits to individuals who meet the

Act’s eligibility requirements. Even

requiring miners to wait an additional

period of time between additional

claims would involve similar risks. The

average applicant for benefits is over 60

years old, and any delay in the receipt

of benefits may effectively deny them

the right to receive benefits and

appropriate medical treatment.

Accordingly, the Department does not

intend to ‘‘penalize’’ individuals who

file unsuccessful subsequent claims.

(i) A number of comments object that

the revisions encourage the repeated

relitigation of cases without

Congressional authority. The

Department has previously explained

that section 725.309 does not allow the

relitigation of denied claims. 64 FR

54968, 54984–85 (Oct. 8, 1999). Once a

claim has been denied, and the one-year

time period for modification has passed,

a claimant cannot thereafter seek to

have that claim reopened. Even if he

prevails on a subsequent claim, the

miner will be unable to obtain benefits

for any period prior to the date on

which the earlier denial became final.

Thus, rather than encouraging repeated

relitigation, the Department is simply

effectuating Congressional intent that

miners who are totally disabled due to

pneumoconiosis receive compensation

for their injury. Additional or

subsequent claims must be allowed in

light of the latent, progressive nature of

pneumoconiosis. Thus, the additional

claim is a different case, with different

facts (if the claimant is correct that his

condition has progressed). There is no

indication that Congress intended to

deny a miner benefits, or otherwise

penalize him, for erroneously filing an

application before his disease had

progressed to the point of total

disability.

Moreover, as the Department

explained in its second notice of

proposed rulemaking, the revised

version of § 725.309 does not have a

reopening effect equivalent to that of

H.R. 2108. 64 FR 54972 (Oct. 8, 1999).

The House of Representatives passed

H.R. 2108 in 1994, but the Senate

adjourned without taking action on the

legislation. If enacted, the bill would

have required the de novo consideration

of any claim filed on or after January 1,

1982, without regard to any earlier

denials. The Department’s regulation

does not have that effect. It simply

codifies the Department’s former rule, as

interpreted by the appellate courts, and

provides procedures to be followed

upon the filing of an additional claim

covering later periods of alleged benefit

entitlement. Accordingly, the

Department is not authorizing the

reopening or relitigation of claims in

excess of Congressional authority. In

addition, as the Department has

previously explained, Congress’ failure

to enact legislation governing additional

claims does not prevent the Department

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79975

from promulgating regulations on that

subject as long as the regulations are

issued pursuant to an appropriate grant

of statutory authority. Ibid.

(j) One comment suggests that the

Black Lung Disability Trust Fund

should be liable for the payment of any

subsequent claims that are approved.

The commenter states that imposing the

liability for these claims on the

insurance industry is fundamentally

unfair. The Department disagrees. As

revised, section 725.309 does not alter

the adjudication of additional claims in

any substantive manner. Since 1978,

section 725.309 has recognized the need

for allowing additional claims and

provided the conditions under which

such claims could be approved. As the

Department has repeatedly emphasized,

the revised regulation simply effectuates

the gloss given this regulation by the

federal courts of appeals. The

Department recognizes that additional

claims filed after the effective date of

these regulatory revisions will be

adjudicated under new procedural

rules, and under regulations that clarify

the entitlement criteria in Part 718 in a

manner consistent with appellate

interpretations of the existing criteria.

The insurance policies purchased by

coal mine operators to secure their

liability under the Black Lung Benefits

Act require the insurer to assume the

risk of adverse appellate court

interpretations of the statute and

regulations as well as the possibility of

revision of the statutory criteria. See 20

CFR 726.203(b) (1999) (insurance

endorsement). Accordingly, the

Department does not agree that the

insurance industry is entitled to relief

from the effect of revising § 725.309.

(k) A number of comments voice their

approval of the changes in the

Department’s second notice of proposed

rulemaking. No other comments have

been received concerning this section

and no other changes have been made

to it.

20 CFR 725.310

(a) In its first notice of proposed

rulemaking, the Department proposed

amending subsection (b) to limit the

documentary medical evidence that

parties are entitled to submit in

connection with a request for

modification. 62 FR 3353 (Jan. 22,

1997). The Department amended

subsection (c) to reconcile a number of

appellate decisions concerning the

district director’s ability to conduct

modification proceedings under the

Black Lung Benefits Act and to ensure

that any party requesting modification

receives a de novo adjudication of the

existing evidence of record. The

Department also revised subsection (d)

with the stated purpose of prohibiting

the recovery, by either the Trust Fund

or a responsible operator, of benefits

paid pursuant to a final award of

benefits that is later modified. In its

second notice of proposed rulemaking,

the Department added two provisions to

subsection (d). The first would allow the

recovery of any benefits that were paid

when the claimant was at fault in

creating the overpayment. The second

provision implemented the

Department’s intention to bar recovery

of overpayments arising from

modification of awards where the award

was final before initiation of the

modification proceedings. 64 FR 54985–

86 (Oct. 8, 1999). In addition, the

Department proposed revising the

evidentiary limitation in subsection (b)

to correspond to similar changes in

§ 725.414. Finally, the Department

responded to comments addressing the

responsibility of factfinders to reweigh

the evidence of record on modification,

and the district director’s authority to

initiate modification in responsible

operator cases.

(b) One comment argues that the

Department’s proposed regulation

destroys the effect of claim preclusion

and issue preclusion, while another

comment suggests that the revised

regulation would allow an adjudicator

simply to reweigh the evidence of

record and reach a conclusion different

from the one reached before. Both

observations are correct, and both

outcomes are mandated by the statutory

language that the regulation

implements, 33 U.S.C. 922, incorporated

into the Black Lung Benefits Act by 30

U.S.C. 932(a). In Banks v. Chicago Grain

Trimmers Association, 390 U.S. 459

(1968), the Supreme Court reversed an

appellate court’s holding that a

claimant’s modification request was

barred by res judicata, or claim

preclusion. Instead, the Court held that

the statute clearly authorized reopening

compensation awards in order to correct

factual errors. In O’Keeffe v. AerojetGeneral Shipyards, Inc., 404 U.S. 254,

255 (1972), the Court held that a

factfinder was authorized to grant

modification under section 22 ‘‘merely

on further reflection on the evidence

initially submitted.’’ See also Betty B

Coal Co. v. Director, OWCP (Stanley),

194 F.3d 491, 497 (4th Cir. 1999)

(modification procedure is

extraordinarily broad, especially insofar

as it permits the correction of mistaken

factual findings); The Youghiogheny &

Ohio Coal Co. v. Milliken, 200 F.3d 942,

954 (6th Cir. 1999) (ALJ has the

authority on modification simply to

rethink his conclusions). One

commenter also objects that the

regulation would prohibit an

administrative law judge from simply

denying a modification request based on

the claimant’s failure to present

additional evidence. In its second notice

of proposed rulemaking, the Department

observed that the Supreme Court’s

O’Keeffe decision requires this result. 64

FR 54986 (Oct. 8, 1999). Accordingly,

the commenters’ observations do not

provide a basis for altering the

Department’s proposal.

(c) Two comments renew the

argument that the Department should

not be able to initiate modification in

responsible operator cases. The

Department responded to a similar

comment in its second notice of

proposed rulemaking by citing the clear

statutory language providing the district

director with the independent authority

to initiate modification. (‘‘Upon his own

initiative, * * *, on the ground of a

change in conditions or because of a

mistake in a determination of fact * * *

the deputy commissioner may * * *

issue a new compensation order. * * *

33 U.S.C. 922(a), as incorporated by 30

U.S.C. 932(a)). The Department also

observed that there were awarded cases

in which a coal mine operator is

nominally liable for the payment of

benefits but, because of bankruptcy,

dissolution, or other events, can no

longer pay. In such cases, the

Department noted the district director’s

need to exercise his modification

authority. 64 FR 54986 (Oct. 8, 1999). In

response, one commenter requests that

the Department limit its authority to

initiate modification to those specific

cases involving operator bankruptcy.

The Department declines to do so. The

district director’s initiation of

modification in any case, whether the

defendant is a responsible operator or

the Trust Fund, is consistent with

Congress’s intent. Congress has

included in the Black Lung Benefits Act

section 22 of the Longshore and Harbor

Workers’ Compensation Act, a workers’

compensation program in which the

overwhelming majority of cases

represent disputes between an employee

and his private employer. Thus,

Congress clearly contemplated that the

district director would exercise his

modification authority in cases

involving private employers. The

examples provided by the Department

in its second notice of proposed

rulemaking were not intended to be an

exclusive listing of the circumstances in

which a district director would be

justified in initiating modification in a

responsible operator case. Because the

79976 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Department does not believe it can

readily identify all of the circumstances

in which district director-initiated

modification would be appropriate, it

does not intend to limit the district

director’s discretion in the initiation of

modification proceedings.

(d) One comment argues that an

operator seeking to modify a benefits

award should not be able to obtain new

pulmonary testing, but should instead

be limited to the report of one

consultant. The commenter also argues,

however, that miners should be able to

submit the results of additional testing

in support of a modification petition

seeking to change a denial of benefits to

an award. The Department does not

agree that opposing parties should be

governed by different evidentiary rules.

One of the Department’s goals in

proposing a limitation on the

submission of documentary medical

evidence, as reflected in § 725.414 and

§ 725.310, is to ensure that claimant and

the responsible operator have an equal

opportunity to present the highest

quality evidence to the factfinder. That

goal would not be served by creating an

evidentiary advantage for a claimant

who requests modification of a denial of

benefits. In such cases, both the

claimant and the responsible operator,

or Trust Fund in appropriate cases, will

be entitled to submit one medical

report, and associated testing, as well as

appropriate rebuttal evidence, as

outlined in the Department’s second

notice of proposed rulemaking.

(e) One comment argues that in light

of the evidentiary limitations imposed

by section 725.310 and 725.408, an

operator will be deprived of its ability

to seek modification of an erroneous

responsible operator determination that

is discovered after the hearing. The

Department disagrees that the

regulations will always prevent an

operator from seeking modification of a

responsible operator determination

based on newly discovered evidence. It

is true, however, that the regulations

limit the types of additional evidence

that may be submitted on modification

and, as a result, an operator will not

always be able to submit new evidence

to demonstrate that it is not a

potentially liable operator.

The Department explained in its

previous notices of proposed

rulemaking that the evidentiary

limitations of §§ 725.408 and 725.414

are designed to provide the district

director with all of the documentary

evidence relevant to the determination

of the responsible operator liable for the

payment of benefits. The regulations

recognize, and accord different

treatment to, two types of evidence: (1)

Documentary evidence relevant to an

operator’s identification as a potentially

liable operator, governed by § 725.408;

and (2) documentary evidence relevant

to the identity of the responsible

operator, governed by § 725.414 and

725.456(b)(1). Under section 725.408, a

coal mine operator that has been

identified as a potentially liable

operator by the district director with

respect to a particular claim for benefits

must contest that identification within

30 days of the date on which it receives

that notification, and must submit

certain evidence within 90 days of

receipt of notification. § 725.408(a), (b).

The specific issues on which the

operator must submit all of its

documentary evidence within this 90-

day period include whether the operator

was an operator after June 30, 1973;

whether it employed the miner for a

cumulative period of not less than one

year; whether the miner was exposed to

coal mine dust while working for the

operator; whether the operator

employed the miner for at least one day

after December 31, 1969; and whether

the operator is financially capable of

assuming liability for the payment of

benefits. The time period for submitting

this evidence may be extended for good

cause, § 725.423, but the operator may

not thereafter submit any further

documentary evidence on these issues.

§ 725.408(b)(2).

Sections 725.414 and 725.456(b)(1)

govern the remaining documentary

evidence relevant to the liability issue,

i.e., evidence relevant to which of the

miner’s former employers is the

responsible operator according to the

criteria set forth in § 725.495. Under

§ 725.414, an operator may submit

documentary evidence to prove that a

company that more recently employed

the miner should be the responsible

operator. This evidence must be

submitted to the district director in

accordance with a schedule to be

established by the district director.

§ 725.410. Additional documentary

evidence may be submitted only upon a

showing of extraordinary circumstances.

§ 725.456(b)(1).

The operator’s ability to seek

modification based on additional

documentary evidence will thus depend

on the type of evidence that it seeks to

submit. Where the evidence is relevant

to the designation of the responsible

operator, it may be submitted in a

modification proceeding if

extraordinary circumstances exist that

prevented the operator from submitting

the evidence earlier. For example,

assume that the miner’s most recent

employer conceals evidence that

establishes that it employed the miner

for over a year, and that as a result an

earlier employer is designated the

responsible operator. If that earlier

employer discovers the evidence after

the award becomes final, it would be

able to demonstrate that extraordinary

circumstances justify the admission of

the evidence in a modification

proceeding.

That same showing, however, will not

justify the admission of evidence

relevant to the employer’s own

employment of the claimant. Under

§ 725.408, all documentary evidence

pertaining to the employer’s

employment of the claimant and its

status as a financially capable operator

must be submitted to the district

director. The comment appears to

suggest that there will be cases in which

an operator discovers evidence bearing

on its own employment of the miner

after the period for submitting evidence

has closed. The Department does not

believe that there are extraordinary

circumstances sufficient to justify the

admission of this evidence in any

further proceedings. The evidence in

question is within the control of the

operator notified by the district director

or, where an insurance company is the

real party-in-interest, in the control of a

party with whom that insurer has

contracted to provide necessary

coverage. The time period set forth in

section 725.408 is adequate to permit a

full investigation and development of

this evidence. If the operator or insurer

is unable to locate the evidence within

that period, it should seek an extension

of time from the district director.

A party’s ability to seek

reconsideration under § 22 of the

Longshore and Harbor Workers’

Compensation Act is subject to the

limitation that reconsideration must

‘‘ ‘render justice under the Act.’ ’’

McCord v. Cephas, 532 F.2d 1377,

1380–81 (D.C. Cir. 1976). In McCord, an

employer declined to supply evidence

and participate in the initial

adjudication of the claimant’s

application for benefits under the

Longshore and Harbor Workers’

Compensation Act. After the award

became final, the employer sought

reconsideration. The D.C. Circuit held

that although the adjudication officer

had jurisdiction to consider the

employer’s request, his consideration

should take the interests of justice into

account. See also General Dynamics

Corp. v. Director, OWCP, 673 F.2d 23,

25 (1st Cir. 1982). In order to properly

administer the Black Lung Benefits Act

in accordance with this expression of

Congressional intent, S.Rep. No. 588,

73d Cong., 2d Sess., 3–4 (1934);

H.R.Rep. No. 1244, 73d Cong., 2d Sess.,

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79977

4 (1934), the Department has balanced

the desire of operators to request

modification against the Department’s

interest in ensuring that potentially

liable operators submit all of the

evidence relevant to their employment

of the miner while the claim is first

pending before the district director. The

Department believes that it is

appropriate to prohibit an operator’s

ability to introduce, in a modification

proceeding, ‘‘new’’ evidence relevant to

the operator’s employment of the miner

or the operator’s status as a financially

capable operator.

(f) One comment argues that the

Department has not taken sufficient

steps to prevent the misuse of

modification by claimants who file

repeated modification petitions. The

commenter has supplied no information

that suggests there is a widespread

problem involving the filing of nonmeritorious modification petitions by

claimants. Like operators, claimants

may only obtain such reconsideration as

will render justice under the Act, and

operators remain free to assert, on a

case-by-case basis, that the application

of this standard requires a denial of a

claimant’s request for modification. The

Department does not believe, however,

that it should establish numerical or

temporal limitations (e.g., limiting

claimants to a maximum number of

modification requests, or no more than

a certain number in a given time period)

on a claimant’s right to seek

modification. Congress’s overriding

concern in enacting the Black Lung

Benefits Act was to ensure that miners

who are totally disabled due to

pneumoconiosis arising out of coal mine

employment, and the survivors of

miners who die due to pneumoconiosis,

receive compensation. Because any

limitation on the right to file

modification petitions could deny, or

delay, the payment of compensation to

eligible claimants, the Department does

not believe that such limitations are

appropriate.

(g) One comment suggests that the

proposal authorizes claimants to

petition for modification in order to

avoid the repayment of an overpayment.

The Department does not believe that

the regulation addresses this situation.

The Department’s current practice, in

cases in which payments from the Black

Lung Disability Trust Fund have been

made based on the district director’s

initial determination, and benefits have

subsequently been denied by a higher

tribunal, has been to suspend the

collection of any potential overpayment

if that denial has been appealed further.

The Department currently permits its

district directors to exercise discretion

as to whether to suspend collection

where the original denial has become

final and the claimant has filed a

request for modification. For example,

in cases where the request is based

solely on a change in the miner’s

condition, a district director could

reasonably conclude that the

overpayment of benefits for a period

prior to that change should not be

suspended. In both former § 725.547(c)

and new § 725.549(a), district directors

are permitted to ‘‘issue appropriate

orders to protect the rights of the

parties.’’ The Department anticipates

that any disputes over the collection of

overpayments will be resolved under

that provision. Accordingly, there is no

need to address the collection of

overpayments in the regulation

governing modification.

(h) No other comments have been

received concerning this section, and no

other changes have been made to it.

20 CFR 725.311

(a) The Department proposed revising

§ 725.311 in its first notice of proposed

rulemaking in order to remove the rule

allowing parties an additional 7 days

within which to respond to a document

that is sent by mail, and to add the

birthday of Martin Luther King, Jr., to

the list of legal holidays contained in

the regulation. 62 FR 3354 (Jan. 22,

1997). The Department also sought to

resolve a split between the Courts of

Appeals for the Fourth and Tenth

Circuits governing the time period for

responding to a document which was

supposed to be served by certified mail

but was not. Compare Dominion Coal

Corp. v. Honaker, 33 F.3d 401, 404 (4th

Cir. 1994) with Big Horn Coal Co. v.

Director, OWCP, 55 F.3d 545, 550 (10th

Cir. 1995). In a case in which the party

actually received the document,

notwithstanding improper service, the

rule would commence the time period

for response upon a party’s actual

receipt of the document. The

Department did not address this

regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) One comment objects to deletion

of the seven-day grace period, formerly

applicable to all documents sent by

mail, arguing that the Department has

no good reason to eliminate it. The

commenter also suggests that, if the

grace period is not replaced with

something else, the regulation will

cause unnecessary litigation over

deadlines and the unnecessary

deprivation of the parties’ rights.

When the Department first proposed

section 725.311, see 43 FR 17743–44

(April 25, 1978), the regulation

contained a three-day mailing rule

which paralleled the rule in the Federal

Rules of Civil Procedure. Compare Fed.

R. Civ. P. 6(e). In the final rule, the

Department changed the time period to

seven days ‘‘[i]n view of the difficulties

encountered in mail deliveries in many

rural coal mining areas.’’ 43 FR 36786

(Aug. 18, 1978). The Department’s

experience in administering the black

lung benefits program, however, has

suggested that the grace period

contained in the former regulation was

a source of confusion for the parties as

well as for the district directors. For

example, it could be argued that the

former regulation added an additional

seven days to the one-year time limit for

filing a modification petition, or the 30-

day time limit for filing a response to a

proposed decision and order. The

federal rule has engendered similar

litigation. See, e.g., FHC Equities v. MBL

Life Assurance Corp., 188 F.3d 678,

681–82 (6th Cir. 1997) (rule does not

apply to time periods that begin with

entry of an order or judgment).

Accordingly, the Department has

eliminated the seven-day grace period

insofar as it formerly applied to all

documents served by mail. The

Department believes that, rather than

increasing litigation, the revised

regulation will provide the parties with

more exact notice of when pleadings are

due, and thus will reduce litigation over

issues raised by the seven-day grace

period. As a general rule, the analogy

between the Department’s black lung

regulations and the federal rules is

inexact. The federal rules govern the

filing of a variety of pleadings,

including responses to complex

motions. Rule 6(e) attempts to ensure

that a party receives the full amount of

time—usually thirty days—allotted by

the drafters of the rules for preparing a

response. In contrast, the documents

whose filing is governed by Part 725 are

relatively straightforward and simple.

They include responses to a schedule

for the submission of evidence issued

under § 725.410, which will contain the

district director’s designation of the

responsible operator, and a proposed

decision and order issued under

§ 725.418. The regulations require that a

party do no more within the initial 30-

day period following the issuance of

these documents than indicate its

agreement or disagreement with the

assertions or findings contained in the

document. The Department believes that

this 30-day time period, commencing

with the date the document is sent,

provides ample time for the parties’

responses. Deleting the grace period

79978 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

ensures that all parties to a claim,

including claimants who are not

represented by an attorney, are able to

ascertain their response time from the

date of a document.

The Department recognizes that one

of the filings governed by Part 725 is

more complex. Section 725.408 requires

that an operator that has been identified

by the district director of its status as a

potentially liable operator must accept

or contest that identification within 30

days of the date on which it receives

notification from the district director.

That response requires the operator to

address five specific assertions: that the

operator was an operator after June 30,

1973; that the operator employed the

miner for a cumulative period of not

less than one year; that the miner was

exposed to coal mine dust while

working for the operator; that the

miner’s employment with the operator

included at least one working day after

December 31, 1969; and that the

operator is capable of assuming liability

for the payment of benefits. That

response requires more investigation

than the others in Part 725. In addition,

unlike the other response times

governed by Part 725, the operator’s

response does not begin to run on the

date that the notification is mailed, but

on the date that it is received. In order

to ensure that operators have the full 30

days in which to file their responses,

and to allow the Department to assess

the timeliness of that response, the

Department has added a sentence to

subsection (d). This provision will allow

the district director to presume, in the

absence of evidence to the contrary, that

the notice was received seven days after

it was mailed.

(c) One comment urges enlarging the

number of communications which must

be sent by certified mail to include

several types of decisional documents

issued by the district director.

Specifically, the commenter suggests

use of certified mail to serve the

following documents: initial

determination; proposed decision and

order; decision on modification; denial

by reason of abandonment; notice of

conference; and memorandum of

conference. The Department’s revised

regulations ensure that all important

documents are served by certified mail.

See proposed § 725.407(b) notification

of potentially liable operator,

§ 725.409(b) (denial by reason of

abandonment); § 725.410(c) (evidentiary

submission schedule); § 725.418(b)

(proposed decision and order). The

revised regulations eliminate the district

director’s initial finding and

memorandum of conference. The

‘‘initial determination’’ is a document,

served on all the parties after the

issuance of a proposed decision and

order, requesting that the designated

responsible operator commence the

payment of benefits. It does not require

a written response. 20 CFR 725.420

(1999). With respect to a case in which

a petition for modification is being

adjudicated, the district director may

issue either a proposed decision and

order or a denial by reason of

abandonment at the conclusion of the

proceedings; both of these documents

must be served by certified mail. The

Department believes the current

requirements provide adequate

protection for the parties, and therefore

declines to add the notice of conference

to the list of documents which must be

served by certified mail. Section

724.416, governing the conduct of

informal conferences, permits the

imposition of sanctions only for a

party’s unexcused failure to attend. In

the case of a claimant, the district

director must offer the claimant an

opportunity to explain why he did not

appear at the conference. See

§ 725.409(b). The Department believes

that failure to receive the notice of

conference would constitute an

adequate explanation for a claimant’s

failure to appear. Similarly, any

employer against whom the district

director has imposed sanctions for an

unexcused failure to appear at an

informal conference may request

reconsideration based on its failure to

receive the required notice. Obviously,

district directors may obviate the need

for disputes over whether a party

received the notice by sending it via

certified mail.

(d) Two comments urge the

Department to afford a party either a

rebuttable presumption or a conclusive

finding of non-receipt of a document if

it must be sent by certified mail, the

party alleges a failure to receive it, and

the Department cannot produce a signed

return receipt. The recommended

presumption is not necessary. In the

foregoing circumstances, an allegation

of non-receipt and absence of the signed

return receipt is sufficient to impose on

the Department the burden to prove by

some other evidence that the individual

received the document. The lack of the

signed receipt itself, however, should

not be conclusive if other circumstances

demonstrate the individual actually

received the document. The Department

therefore declines to amend the

proposal.

(e) One comment argues that

subsection (d) is inconsistent with

existing law. The commenter believes

subsection (d) requires the response

time to commence upon service of the

document rather than the date of actual

receipt when a document is served in

violation of the certified mail

requirement. Subsection (d), however,

states that the response time ‘‘shall

commence on the date the document

was received.’’ The provision is

therefore clear that only actual receipt of

a document served in violation of a

certified mail requirement commences

the recipient’s time for response.

(f) No other comments concerning this

section were received, and no changes

have been made in it.

Subpart D

20 CFR 725.351

The Department made only technical

changes to section 725.351 in its initial

notice of proposed rulemaking, and the

rule was not open for comment. See 62

FR 3340–41 (Jan. 22, 1997). In its second

notice of proposed rulemaking, the

Department proposed deleting the

requirement in subsection (a)(3) that a

district director must seek the approval

of the Director, OWCP, before issuing a

subpoena to compel the production of

documents. 64 FR 54986–87 (Oct. 8,

1999). No comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.362

In its initial notice of proposed

rulemaking, the Department proposed

revising section 725.362 in order to

conform the regulation to the

requirements of 5 U.S.C. 500(b), which

allows an attorney to enter an

appearance without submitting an

authorization signed by the party he

represents. The Department also

proposed adding a requirement that a

notice of appearance, whether by an

attorney or by a lay representative,

include the OWCP number of the claim.

62 FR 3354 (Jan. 22, 1997). The

Department did not discuss the rule in

its second notice of proposed

rulemaking. See list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999). No comments were

received concerning this section, and no

changes have been made in it.

20 CFR 725.365

The Department received one

comment relevant to § 725.365. This

section was not open for comment; it

was repromulgated without alteration

for the convenience of the reader. See 62

FR 3341 (Jan. 22, 1997); 64 FR 54970

(Oct. 8, 1999). Therefore no changes are

being made in it.

20 CFR 725.366

The Department has received one

comment relevant to § 725.366. This

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79979

section had only technical revisions

made to it and was not open for

comment, see 62 FR 3341 (Jan. 22,

1997); 64 FR 54970 (Oct. 8, 1999).

Therefore no changes are being made in

it.

20 CFR 725.367

(a) In its initial notice of proposed

rulemaking, the Department proposed a

number of revisions to clarify the

application of section 28 of the

Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 928, as

incorporated by 30 U.S.C. 932(a), and

made relevant to adjudications under

the Black Lung Benefits Act. 62 FR 3354

(Jan. 22, 1997). The regulation provided

a non-exclusive list of instances in

which an operator could be held liable

for the payment of a claimant’s

attorney’s fee, and recognized the Trust

Fund’s liability for fees by making it

coextensive with that of a responsible

operator. The Department proposed a

substantial revision of this regulation in

its second notice of proposed

rulemaking. 64 FR 54987–88 (Oct. 8,

1999). Because the evidentiary

limitations proposed by the Department

make legal representation for claimants

advisable at the earliest possible stage of

claims adjudication, the Department

revised the regulation to require

operators or the Trust Fund to pay a

reasonable fee for any necessary work

done even if the work was performed

prior to the date on which the operator

controverted the claimant’s entitlement

to benefits. Thus, although the creation

of an adversarial relationship and the

ultimately successful prosecution of a

claim were still necessary to trigger

employer or fund liability for attorneys’

fees, the date on which the adversarial

relationship commenced no longer

served as the starting point for such

liability. The Department rejected

comments suggesting that lay

representatives should be entitled to

collect fees from responsible coal mine

operators or the fund. The Department

also discussed the several appellate

court decisions and their impact on

responsible operator and fund liability

for attorneys’ fees.

(b) The Department has revised the

first sentence of subsection (a)(1) and

the first sentence of subsection (a)(2) in

order to reflect changes to §§ 725.410

and 725.412. In place of the former

initial finding, the district director will

issue a schedule for the submission of

additional evidence under § 725.410.

This schedule will include the district

director’s preliminary analysis of the

medical evidence of record, and his

designation of the responsible operator

liable for the payment of benefits.

Section 725.412 provides that, following

receipt of the schedule, the designated

responsible operator may file a

statement accepting the claimant’s

entitlement to benefits. The operator

may avoid any liability for attorneys’

fees by filing this statement within 30

days of the issuance of the schedule. If

it fails to do so, the responsible operator

will be considered to have created an

adversarial relationship between the

operator and the claimant. If the district

director exercises his authority under

§ 725.415 or § 725.417 to issue another

schedule for the submission of

additional evidence in order to

designate a different operator as the

responsible operator, and that operator

is ultimately determined to be liable for

the payment of benefits, that operator

will be liable for the payment of

attorneys’ fees only if it fails to accept

the claimant’s entitlement within 30

days of the date upon which it is

notified of its designation. In cases

where there is no operator liable for the

payment of benefits, the district

director’s issuance of a schedule for the

submission of additional evidence will

create the adversarial relationship

between the Black Lung Disability Trust

Fund and the claimant, such that the

Trust Fund will be liable for attorneys’

fees if the claim is successfully

prosecuted. Similarly, in subsection

(a)(4) the Department has deleted the

reference to an operator’s ‘‘notice of

controversion’’ contesting a claimant’s

request for an increase in the amount of

benefits payable. As revised, the

regulations do not require a specific

notice of controversion to create the

adversarial relationship between a

claimant and an employer.

The Department has also substituted

the phrase ‘‘reasonable fees for

necessary services’’ for the phrase ‘‘fees

for reasonable and necessary services’’

in subsection (a), and has substituted

the phrase word ‘‘necessary’’ for the

word ‘‘reasonable’’ in subsections

(a)(1)–(5). The changes make the

regulation consistent with § 725.366(a).

The previous wording was not intended

to create a different test for gauging the

need for an attorney’s services, and the

revision will eliminate any potential

confusion.

(c) Two comments argue that the

Department’s proposal violates the plain

language of the incorporated provision

of the Longshore and Harbor Workers’

Compensation Act governing the

payment of attorneys’ fees. Specifically,

they argue that section 28 permits

employer liability for a claimant’s

attorney’s fees only for services

rendered after the employer controverts

the applicant’s eligibility for benefits.

One of the commenters also cites the

expectation, created by the statute, that

a claimant is responsible for a portion

of the fees owed to his attorney and

specifically the fee for any service

provided before the employer

controverts the applicant’s entitlement.

The commenter suggests that, by

removing that responsibility from the

claimant, the Department has not

properly implemented the statute.

The Department does not agree that

the revised regulation violates the plain

language of the statute. The only court

to have considered this issue is the

Court of Appeals for the Fourth Circuit.

In Kemp v. Newport News Shipbuilding

and Dry Dock Co., 805 F.2d 1152 (4th

Cir. 1986), the court held that the

LHWCA is ambiguous on the issue of

whether an employer may be liable for

attorneys’ fees incurred by a claimant

before the employer has controverted

the claimant’s entitlement. 805 F.2d at

1153. Instead, the statute provides only

that an employer will be liable for

attorneys’ fees after it contests the

applicant’s entitlement, leaving

unresolved the starting point of such

liability. The court recently reiterated its

interpretation of LHWCA § 28 in

Clinchfield Coal Co. v. Harris, 149 F.3d

307, 310–11 (4th Cir. 1998). In resolving

statutory ambiguity through the

regulatory process, the Department is

entitled to select any reasonable

interpretation that is consistent with

Congressional intent. Chevron U.S.A.,

Inc. v. Natural Resources Defense

Council, 467 U.S. 837, 842–3 (1984).

The Department is fundamentally

altering the obligations of the parties at

the district director level in a manner

that will encourage claimants to consult

with attorneys much earlier in the

process. Among other things, the

Department is limiting the quantity of

medical evidence that all parties are

entitled to submit. In addition, at the

claimant’s request, the Department will

provide his treating physician with the

test results obtained during the

complete pulmonary evaluation

authorized by section 413(b) of the Act,

30 U.S.C. 923(b). Because these

revisions will require claimants to make

critical decisions at the earliest stage of

adjudication, the regulations must also

encourage attorneys to represent

claimants as early as possible. The

Department hopes that claimants will

receive advice when that advice is most

helpful. Insurance carriers, who are

primarily liable in cases in which they

provide insurance to the responsible

operator, as well as self-insured

operators, most commonly have the

assistance of experienced attorneys and

claims processing agents in the early

79980 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

stages of claim development, and the

Department believes that claimants

should have comparable aid.

Accordingly, the Department believes

that it is justified in adopting a new

interpretation as to the starting point of

the employer’s or the fund’s liability for

attorneys’ fees.

In addition, contrary to the suggestion

of the commenter, the Department’s

proposal does not eliminate all

instances in which a claimant may be

responsible for his attorney’s fees.

Section 28(c), 33 U.S.C. 928(c), states

that ‘‘[a]n approved attorney’s fee, in

cases in which the obligation to pay the

fee is upon the claimant, may be made

a lien upon the compensation due under

an award.’’ The commenter argues that

a claimant will never be liable for

attorneys’ fees under the Department’s

proposal, and that the proposal thus

contravenes the statutory language. The

Department does have the authority to

vary incorporated provisions of the

Longshore Act for purposes of

administering the Black Lung Benefits

Act, see 30 U.S.C. 932(a). It has not done

so in this case, however. Instead, the

Department’s regulation does

contemplate that a claimant may be

liable for an attorney’s fee. 20 CFR

725.365. For example, in any case in

which the liable party, either the Trust

Fund or the operator, accepts the

claimant’s entitlement prior to the

expiration of the 30-day period in

§ 725.412(b) but the claimant has

nevertheless retained counsel who has

performed services in connection with

the claim, the prerequisite for shifting

fee liability—the controversion of

entitlement—has not been met. A

similar case may arise where the

operator initially designated the

responsible operator by the district

director fails to accept the claimant’s

eligibility, but the finally designated

responsible operator does accept the

claimant’s eligibility. In such a case, the

responsible operator would not be liable

for the payment of the claimant’s

attorney’s fee. Because the

overwhelming majority of coal mine

operators contest claimant eligibility at

this stage, the Department does not

expect this kind of case to arise often.

In either case, however, the claimant

remains responsible for any reasonable

fees approved by the district director for

necessary work performed in obtaining

the award. Accordingly, the

Department’s revised attorney fee

regulation does not violate any statutory

command.

(c) One comment observes that the

Department’s revisions would expand

the availability and award of attorneys’

fees, while another argues that the

Department’s provision may not be

applied retroactively. It has consistently

been the Department’s position that

before liability for a claimant’s

attorney’s fee may shift to a responsible

operator or the fund, there must be a

controversion of entitlement sufficient

to create an adversarial relationship

followed by the successful prosecution

of a claim. Nothing in this regulation

alters that requirement. The Department

does agree, however, that once these

prerequisites are met, the revised

regulation could result in the award of

higher attorneys’ fees. The Department

believes that an increase in attorneys’

fees is necessary in order to encourage

earlier attorney involvement in the

adjudicatory process, and that such

involvement will be helpful to

claimants in light of the evidentiary

restrictions imposed by these

regulations. The Department also hopes

to encourage a larger number of

attorneys to represent claimants by

allowing the award of higher fees.

During the rulemaking hearings,

witnesses repeatedly brought to the

Department’s attention that few

attorneys are willing to represent

claimants, in part because of the many

restrictions on the award of attorneys’

fees. Transcript, Hearing on Proposed

Changes to the Black Lung Program

Regulations, (June 19, 1997), p. 22

(testimony of Cecil Roberts); p. 168

(testimony of John Cline); pp. 238–239,

246 (testimony of Grant Crandall). The

Department also agrees that the rule

should not be applied retroactively, and

has changed § 725.2 accordingly.

(d) Several comments agree with the

Department’s revisions, but two urge the

Department to take further steps to

increase the participation of attorneys in

black lung benefits adjudications by

providing additional attorney funding

from the Black Lung Disability Trust

Fund. Specifically, the commenters urge

the Department to make funds available

to pay black lung associations and other

non-profit groups assisting claimants or

to advance fees awarded to claimant

attorneys litigating against responsible

operators before the award of benefits

becomes final. The commenters also

urge the Department to repeal the

prohibition on receiving fees for time

spent preparing a fee petition, and to

clarify the right of attorneys to obtain

fees for time spent litigating their right

to fees.

The Department cannot agree that

amounts from the Trust Fund should be

made available to pay additional

attorneys’ fees. In its initial proposal,

the Department observed that one of its

goals in revising the regulation of

attorneys’ fees was to ensure that the

liability of the Trust Fund for such fees

was coextensive with that of a liable

coal mine operator. 62 FR 3354 (Jan. 22,

1997). This liability derives from a

series of appellate court opinions

holding that the Trust Fund must stand

in the shoes of a coal mine operator in

any case in which no operator may be

held liable for the payment of benefits.

62 FR 3354 (Jan. 22, 1997). Those

opinions rejected the Department’s

argument that the Trust Fund could not

be held liable for any attorneys’ fees.

Although the Department’s regulations

have been revised to acknowledge the

Trust Fund’s liability under these

circumstances, the Department does not

believe that the statute can be read in

the manner suggested by these

commenters to authorize the

expenditure of additional amounts of

Trust Fund moneys to increase counsel

availability for black lung claimants.

With respect to time spent preparing

a fee petition and litigating the issue of

attorneys’ fees, two comments seek the

revision of material in § 725.366.

Because § 725.366 was not listed among

the regulations open for comment, no

changes are being made in it. 62 FR

3341 (Jan. 22, 1997); 64 FR 54970 (Oct.

8, 1999). Moreover, the regulation’s

current language does not prohibit an

attorney from receiving a fee for time

spent litigating the amount of his

attorney’s fees, and the Department does

not believe that more explicit language

is necessary. The Benefits Review Board

has held that time spent by an attorney

defending a fee represents ‘‘necessary

work done,’’ so as to entitle the attorney

to an additional fee under 20 CFR

802.203(c) (1999), see Workman v.

Director, OWCP, 6 Black Lung Rep.

(MB) 1–1281, 1–1283 (Ben Rev. Bd.

1984), and the Department believes that

§§ 725.366 and 725.367 require the same

result. The prohibition in § 725.366 on

fees for time spent filling out a fee

application presents an entirely

different question from whether it is

reasonable to require an employer who

unsuccessfully challenges that

application to pay a fee for the

necessary additional time that the

attorney was required to spend

defending his fee request. Because the

Department believes that the current

regulations permit an award of

attorneys’ fees in the latter case, it is not

necessary to change the regulation.

(e) No other comments were received

concerning this section, and no changes

have been made in it.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79981

Subpart E

20 CFR 725.403

The Department made only technical

revisions to § 725.403 in its first notice

of proposed rulemaking, and the

regulation was not open for comment.

62 FR 3341 (Jan. 22, 1997). In its second

notice of proposed rulemaking, the

Department proposed deleting

§ 725.403. 64 FR 54988 (Oct. 8, 1999).

Section 725.403 implemented the

requirement in 30 U.S.C. 923(c) that

claimants who filed applications under

the Black Lung Benefits Act between

July 1 and December 31, 1973, 30 U.S.C.

925, must file a claim under the

workers’ compensation law of their state

unless such filing would be futile.

Because the time period for filing such

claims expired over 25 years ago, the

Department proposed removing

§ 725.403, and specifically invited

comment on its removal. The

Department did not receive any

comments on the proposed removal of

§ 725.403 and therefore has removed it

from further publications of the Code of

Federal Regulations. The Department

has not altered the rules applicable to

any claim filed between July 1 and

December 31, 1973, however. Parties

interested in reviewing § 725.403 may

consult 20 CFR 725.403 (1999).

20 CFR 725.404

The Department received one

comment relevant to § 725.404. The

Department made only technical

revisions to this section, and the

regulation was not open for comment;

see 62 FR 3340–41 (Jan. 22, 1997); 64 FR

54970 (Oct. 8, 1999). Therefore no

changes are being made in it.

20 CFR 725.405

(a) In its first notice of proposed

rulemaking, the Department proposed

revising subsection (b) to recognize its

practice of refusing to provide a

complete pulmonary evaluation to

claimants who never worked as a miner.

62 FR 3354 (Jan. 22, 1997). The

Department did not discuss § 725.405 in

its second notice of proposed

rulemaking. See list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) Two comments argue the

regulation is too limited because it does

not address the district director’s

obligation to develop evidence other

than medical evidence. The Department

disagrees. The specific purpose of this

regulation is stated in its title:

‘‘Development of medical evidence;

scheduling of medical examinations and

tests.’’ The development of evidence in

general is addressed at § 725.404. In any

event, subsection (d) of § 725.405

authorizes the district director to collect

‘‘other evidence’’ concerning the

miner’s employment and ‘‘[a]ll other

matters relevant to the determination of

the claim.’’ This language is sufficiently

broad to acknowledge the district

director’s obligations concerning

evidentiary development of a claim as

well as the authority to discharge those

obligations. No useful purpose would be

served by a more specific enumeration

of particular areas of inquiry in this

provision.

The type of inquiry urged by these

commenters is covered in more detail

elsewhere in the Secretary’s regulations.

Section 725.495(b) imposes on the

Director, OWCP, the burden of proving

that the responsible operator designated

liable for the payment of benefits is a

potentially liable operator. In addition,

§ 725.495(d) requires that if the

responsible operator designated for the

payment of benefits is not the operator

that most recently employed the miner,

the district director must explain the

reasons for his designation. These

provisions make necessary the district

director’s gathering of a miner’s

employment history, including, in most

instances, his Social Security earnings

record. Indeed, § 725.404(a) requires

each claimant to furnish the district

director with a complete and detailed

history of coal mine employment and,

upon request, supporting

documentation. The district director

must send to each operator notified of

its potential liability for a claim copies

of the claimant’s application and all

evidence obtained by the district

director relevant to the miner’s

employment. § 725.407(b), (c). If the

district director concludes that the

miner’s most recent employer cannot be

designated the responsible operator

because it is not financially capable of

assuming liability for the payment of

benefits, the district director must

explain his conclusion based on a

search of the records maintained by the

OWCP. § 725.495(d). Only if the OWCP

has no record of insurance or

authorization to self-insure for that last

employer, and the record so states, may

OWCP name an employer other than the

miner’s most recent as the responsible

operator for the claim. Thus, the district

director’s obligation to develop the

evidence of record, other than medical,

is set forth elsewhere in the regulations

where relevant.

(c) One comment recommends

changing the regulatory reference to

‘‘miner’’ in paragraph (a) from § 725.202

to § 725.101(a)(19). This

recommendation is rejected. While both

sections define ‘‘miner,’’ § 725.202

provides the more detailed definition as

well as the criteria and presumptions

which apply to determining whether a

particular individual satisfies the

definition.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.406

(a) In its first notice of proposed

rulemaking, the Department proposed

revising § 725.406 to address the

relationship between the evidentiary

limitations contained in § 725.414 and

the complete pulmonary evaluation

provided by the Department under 30

U.S.C. 923(b). 62 FR 3354–55 (Jan. 22,

1997). As initially proposed, § 725.406

retained the Department’s practice of

allowing a claimant to select the

physician to perform the complete

pulmonary evaluation at the

Department’s expense. In those cases,

however, the report generated by the

evaluation would have counted as one

of the two reports that the claimant was

entitled to submit into evidence. If, on

the other hand, the claimant went to a

physician selected by the Department,

the evaluation would not count against

the limitations imposed on the claimant.

Instead, in cases in which the Black

Lung Disability Trust Fund would bear

liability for benefits, such a report

would count as one of the two reports

that could be offered by the Director. In

cases in which a responsible operator

was potentially liable for benefits, the

complete pulmonary evaluation

provided by a doctor of the

Department’s choosing would not have

counted against the evidentiary limit

imposed on either the responsible

operator or the claimant. The

Department also discussed its

responsibilities for ensuring that the

report, and each component of the

evaluation, substantially complied with

the Department’s quality standards.

Finally, the Department clarified the

mechanism by which it might seek

reimbursement of the cost of the

evaluation from an operator that had

been finally determined to be liable for

the payment of claimant’s benefits.

The Department proposed major

revisions to § 725.406 in its second

notice of proposed rulemaking. 64 FR

54988–990 (Oct. 8, 1999). The

Department agreed with commenters

who suggested that it placed an

unnecessary burden on a claimant to

choose whether or not to select a

physician to perform his complete

pulmonary evaluation. In most cases,

such a choice would be made before a

claimant obtained representation, and

could result in a claimant being limited

79982 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

thereafter to the submission of only one

additional medical report. Accordingly,

the Department proposed the creation of

a list of physicians, authorized by the

Department to perform complete

pulmonary evaluations. Miners who

applied for benefits would be required

to select a physician from that list, but

could choose any listed doctor either in

their state of residence or from a

contiguous state. The resulting

evaluation would not be considered one

of the two medical reports that a

claimant was entitled to submit in

support of his claim for benefits.

The Department further stated its

intent to develop more rigorous

standards for selecting physicians

authorized to perform a complete

pulmonary evaluation. The

Department’s suggested standards

included: (1) Qualification in internal or

pulmonary medicine; (2) ability to

perform each of the necessary tests; (3)

ability to schedule the claimant for an

evaluation promptly; (4) ability to

produce a timely, comprehensive report;

and (5) willingness to answer follow-up

questions and defend his conclusions

under cross-examination. The

Department specifically sought

comment on these and other standards

for selecting physicians to be included

on its list, 64 FR 54989 (Oct. 8, 1999).

In addition, the Department stated its

intention to survey clinics and

physicians on the fees they charged for

these services, with the goal of attracting

highly qualified doctors to perform the

testing and evaluation required by the

Department for the complete pulmonary

evaluation. The Department also added

subsection (d) to the proposed

regulation in order to allow a claimant

to have the Department send the

objective test results obtained in

connection with the complete

pulmonary evaluation to his treating

physician. The Department noted its

intent to make available to each

claimant at least one set of legally

sufficient objective test results so that

no claimant would be hindered by a

lack of financial resources in pursuing

his application for benefits. 64 FR 54989

(Oct. 8, 1999).

The Department rejected comments

suggesting the deletion of subsection (e),

permitting the district director to clarify

‘‘unresolved medical issues.’’ The

Department also discussed comments

concerning the district director’s ability

to determine whether all parts of the

complete pulmonary evaluation were in

substantial compliance with the

Department’s quality standards. The

Department revised subsection (c) to

provide a claimant whose initial tests do

not comply with the quality standards

due to a lack of effort with one

additional opportunity to take those

tests. Finally, the Department discussed

its treatment of subsequent claims, in

which the Department provides a new

complete pulmonary evaluation, and

modification requests, in which it does

not. 64 FR 54989–90 (Oct. 8, 1999).

(b) Several comments continue to

oppose subsection (e), observing that if

the Department develops a list of highly

qualified physicians to perform the

complete pulmonary evaluation, it

should have no need to seek the opinion

of yet another physician at this stage of

the adjudication. Another comment

objects to the proposed substitution of

evidence under subsection (e), calling it

the destruction of relevant evidence. In

response to the initial proposal, the

same commenter objected to subsection

(e) because the district director’s

authority to have the miner retested and

reexamined invited piecemeal and

protracted evidentiary development.

The Department has reconsidered the

authority granted by subsection (e), and

agrees that the provision should be

deleted. The Department has relabeled

subsection (f) as subsection (e) to

accommodate this revision. The

deletion of subsection (e) does not affect

the district director’s authority under

subsection (c) to determine whether the

individual components of the complete

pulmonary evaluation have been

administered and reported in

compliance with the Department’s

quality standards. The Department

agrees, however, that the district

director should have no need to send

the claimant for additional examination

and testing after completion of a

complete pulmonary evaluation, the

components of which are in substantial

compliance with the applicable quality

standards, § 725.406(a)–(c). Under

revised § 725.406, the initial evaluation

will be performed by a highly qualified

physician who may be asked to clarify

and/or supplement an initial report if

unresolved medical issues remain.

(c) Two comments state that a miner

should be entitled to choose an

authorized physician anywhere in the

country to perform his complete

pulmonary evaluation rather than being

limited to one from his state of

residence or a contiguous state. The

commenters state that claimants would

be willing to pay the additional costs

incurred as a result of such travel.

Although the commenters suggest that

there will not be a sufficient supply of

physicians in some areas, such as

Wyoming and Alabama, the Department

has no evidence that would support that

contention. Moreover, even if the

Department is unable to obtain a

sufficient pool of physicians in certain

states (a pool that includes physicians

in all contiguous states), the Department

will simply adjust the procedural rules

applicable to claimants who reside in

those states. The absence of a sufficient

pool of physicians in some limited

number of states would not justify a

national exception to the policy of

requiring claimants to submit to a

complete pulmonary evaluation in their

own region. In addition, claimants

remain free to go to any physician of

their choosing for the development of

evidence in support of their claims.

(d) One comment argues that

claimants should be randomly assigned

to physicians on the Department’s list

rather than allowing claimants their

own choice. The Department disagrees.

The list that the Department ultimately

compiles will contain physicians who

are well-qualified to perform complete

pulmonary evaluations, and whose

opinions the Department is willing to

accept in the initial stages of

adjudication of the claimant’s eligibility.

Claimants may already be acquainted

with one or more physicians on the list,

and requiring that claimant submit to an

examination by a different physician,

perhaps in a neighboring state, would be

inefficient. Accordingly, the Department

has not changed the regulation.

The commenter also argues that the

mere fact that a physician is included

on the Department’s approved list by

meeting the Department’s standards

does not guarantee that the physician

will provide an impartial opinion,

particularly when a claimant has a role

in selecting the physician who will

perform the complete pulmonary

evaluation. The Department does not

believe that it is required to provide an

absolute guarantee of the impartiality of

physicians selected for inclusion on the

list. By establishing high standards for

the performance of these evaluations,

and by ensuring that only highly

qualified physicians are included on the

approved list, the Department will be

taking appropriate steps to ensure

impartial opinions. In addition, the

Department has revised subsection (c) to

limit a miner’s choice of the examining

physician in two respects. First, the

miner may not select a close relative of

himself or his spouse. The regulation

uses the term ‘‘fourth degree of

consanguinity’’ to exclude, among

others, parents, children, grandchildren,

brothers, sisters, nephews, nieces, aunts,

uncles, and first cousins from those

individuals otherwise qualified to

perform a complete pulmonary

evaluation. Second, the miner may not

select any physician who has examined

him or treated him in the year preceding

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79983

his application for benefits. The

Department believes that it would be

inappropriate to allow a miner to select

a physician with whom he has an

ongoing treatment relationship to

perform the complete pulmonary

evaluation paid for by the Department.

Although the Department does not mean

to suggest that a physician would be

unable to provide an impartial

assessment of the miner’s respiratory

condition in such a case, his opinion

could present at least the appearance of

a conflict of interest. In order to ensure

the credibility of the Department’s

pulmonary evaluation, the Department

has adopted a bright-line test, in the

form of a one-year cutoff, that will be

easily understood by miners and their

physicians. The Department believes

that a physician’s examination or

treatment of the miner prior to the oneyear period preceding the miner’s

application should not disqualify that

physician from performing the complete

pulmonary evaluation. The Department

reserves the right to delete a physician

from the list if he is unable to provide

an impartial opinion.

(e) Several comments argue that the

Department needs to make public the

criteria it will use to select physicians

for inclusion on the list. In its second

notice of proposed rulemaking, the

Department notified interested parties

that these criteria will be published in

the Department’s Black Lung Program

Manual which will be available to the

public. 64 FR 54989 (Oct. 8, 1999).

Interested parties will thus be able to

monitor the Department’s standards and

use of these standards in selecting

physicians for inclusion on the list.

In addition, a number of commenters

responded to the Department’s request

for comments on the standards that the

Department proposed to use to select

physicians. Two commenters

emphasized the importance of requiring

that the evaluations be performed by a

physician board-certified in internal

medicine or a physician board-eligible

in pulmonary medicine or one with

extensive knowledge of pulmonary

disease. The Department will make

every effort to ensure that its list

includes highly qualified physicians.

Optimally, the Department will be able

to enlist the services of Board-certified

internists who have a subspecialty in

pulmonary medicine, who are Boardeligible in pulmonary medicine, or who

can demonstrate extensive experience in

the diagnosis and treatment of

pneumoconiosis to perform complete

pulmonary evaluations. There may be

circumstances, however, in which there

will not be a sufficient supply of such

highly qualified physicians willing to

perform the evaluation. In such areas,

the criteria will need to afford the

Department enough flexibility to ensure

an adequate supply of physicians who

meet certain minimum qualifications,

such as affiliation with a black lung

clinic funded in part by the Department

of Health and Human Services.

Two comments urge the Department

to rule out physicians who have

demonstrated that they do not accept

one or more of the basic premises of the

Black Lung Benefits Act. These

commenters urge the Department to

review the opinions and depositions of

each physician who seeks to be

included on the list, eliminating those

with opinions which make it impossible

to provide a sound evidentiary basis for

the district director’s initial decision.

Another comment urges the Department

to accept any physician who applies for

inclusion on the list provided that the

physician possesses the necessary

professional qualifications. As an initial

matter, the Department does not intend

to screen physicians who apply for

inclusion on the list beyond satisfying

itself that the basic requirements for

inclusion are met. The Department

simply does not have the resources to

conduct an intensive review of the

medical reports and/or deposition

testimony submitted by each physician

in previous black lung cases. The

Department reserves the right, however,

to exclude from its list of approved

physicians those who prove unable to

provide opinions that are consistent

with the premises underlying the statute

and the Secretary’s regulations. The

federal courts of appeals have held that

a denial of benefits may not be based on

a medical opinion that is fundamentally

at odds with the premises of the Black

Lung Benefits Act. See, e.g., Lane

Hollow Coal Co. v. Director, OWCP, 137

F.3d 799, 804–5 (4th Cir. 1998); Penn

Allegheny Coal Co. v. Mercatell, 878

F.2d 106, 109–110 (3rd Cir. 1989);

Robbins v. Jim Walter Resources, Inc.,

898 F.2d 1478, 1482 (11th Cir. 1990);

Wetherill v. Director, OWCP, 812 F.2d

376, 382 (7th Cir. 1987); Kaiser Steel

Corp. v. Director, OWCP, 757 F.2d 1078,

1083 (10th Cir. 1985). The Department

reserves the right to determine

appropriate exclusions from the list on

a case-by-case basis.

(f) One comment states that the

regulation should require the district

director to explain to a claimant the

possible consequences of having his test

results provided to his treating

physician. The Department intends to

provide such information to claimants,

see also 64 FR 54989 (Oct. 8, 1999), but

does not believe that the regulation

must reflect this intention. The

regulation itself does state that a report

from the claimant’s treating physician,

based on the Department’s clinical

testing, will count as one of the two

reports the claimant is entitled to

submit into evidence under § 725.414,

§ 725.406(d).

(g) One comment states that the

Department’s requirements prevent

physicians from exercising their

professional judgment by dictating the

tests that they are required to perform

and by emphasizing promptness and

timeliness over completeness and

thoroughness. The Department

disagrees. The Act authorizes the

Department to set minimal quality

standards for medical evidence. Reports

of physical examination must

substantially comply with the

applicable quality standards, § 718.104.

That regulation requires that a report of

physical examination be based on,

among other things, a chest X-ray, a

pulmonary function test, and a blood

gas study, unless medically

contraindicated. Because these tests are

necessary for a complete pulmonary

evaluation, the Department has

authorized their performance under

§ 413(b) of the Act, 30 U.S.C. 923(b), for

the last two decades. The Department

expects that each physician included on

the list will not only be able to

administer these tests, but will commit

to doing so in substantial compliance

with the Department’s quality

standards, §§ 718.102–.106. The

Department does not believe that its

requirements prevent a physician from

preparing a thorough and complete

medical report. In order to process

claims expeditiously, however, the

Department must also ensure that the

examination is scheduled promptly, and

the resulting report is prepared in a

timely manner. The Department

recognizes that, in some cases, the

claimant’s choice of a physician may

result in a slight delay if the physician

he has selected is busy. The delay in

such a case, however, is solely within

the control of the claimant. If he is

willing to accept the delay, he may wait

for that physician. If not, he may choose

another from the Department’s approved

list.

(h) Several comments approved of the

revisions affording the claimant the

right to select a doctor to perform the

complete pulmonary evaluation from an

approved list.

(i) No other comments were received

concerning this regulation.

20 CFR 725.407

(a) In its first notice of proposed

rulemaking, the Department proposed

moving subsections (a) and (c) of 20

79984 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

CFR 725.407 (1999) to § 725.406 and

eliminating subsection (b). See preamble

to §§ 725.407 and 725.408, 62 FR 3355

(Jan. 22, 1997). In their place, the

Department proposed a new regulation

governing the identification and

notification of ‘‘potentially liable

operators,’’ a subset of the miner’s

former employers that might be liable

for a given claim. Depending on the

complexity of the miner’s employment

history, section 725.407 would permit

the district director initially to notify

one or more potentially liable operators,

and their insurers, of the existence of a

claim and would also allow the

notification of additional potentially

liable operators at any time prior to

referral of the case to the Office of

Administrative Law Judges. The

proposal placed no time limit on the

notification of an operator if that

operator fraudulently concealed its

identity as an employer of the miner.

In its second notice of proposed

rulemaking, the Department proposed

revising subsection (d) to permit the

district director to notify additional

potentially liable operators after an

administrative law judge reversed a

district director’s denial by reason of

abandonment pursuant to § 725.409 and

remanded the case for further

proceedings. 64 FR 54990 (Oct. 8, 1999).

The Department observed that without

this provision, subsection (d) could

have been read to prohibit the

notification of additional operators,

notwithstanding the fact that the district

director had not been able to complete

his administrative processing of the

claim before its referral to the Office of

Administrative Law Judges. In addition,

the Department rejected a suggestion

that it provide guidelines for district

directors to use in determining the cases

in which it would be appropriate to

name more than one potentially liable

operator.

(b) The Department has made two

changes to § 725.407 to conform to

changes to other regulations in this

subpart. The Department has deleted the

reference to a district director’s initial

finding in subsection (a) because the

district director will no longer issue

initial findings. The Department has

replaced the reference to § 725.413 in

the first sentence of subsection (d) with

a reference to § 725.410(a)(3). This

change reflects a move to § 725.410 of

the district director’s authority to

dismiss potentially liable operators that

the district director has previously

notified.

(c) One comment objects that the

Secretary’s regulations preclude the

dismissal of potentially liable operators

who can prove that they were not

properly named. This comment is more

appropriately addressed under

§ 725.465, the regulation governing the

dismissal of claims and parties.

(d) One comment argues that the

revised regulation will raise the

litigation costs of responsible operators.

The commenter observes that the

Department does not dispute the

allegation, made in response to the

Department’s first notice of proposed

rulemaking, that the Department’s

changes will generally increase

litigation costs by $6,000 per claim. The

commenter states that the revisions in

the Department’s second notice of

proposed rulemaking will result in an

additional $6,000 in costs per claim.

With regard to the first figure, the

commenter appears to have

mischaracterized its prior comment. An

economic analysis conducted by

Milliman & Robertson, Inc., and

submitted to the Department in

response to the first notice, was based

in part on an assumption that ‘‘the

average defense costs of $6,000 per

claim currently expended by the

responsible operators/insurers primarily

on claims that are initially awarded or

denied and appealed by the claimant

(presently, approximately 30% of all

claims filed), will be expended on all

claims at the earliest stage of

adjudication.’’ Rulemaking Record,

Exhibit 5–174, Appendix 5 at 4. This

economic analysis did not assert that

costs would rise in all cases, but that

operators and insurers would be

required to incur the cost of fully

developing evidence in cases (70

percent of the claims filed) in which

they formerly did not have to do so. The

analysis did not assert that the

Department’s proposal would raise

litigation costs in the remaining 30

percent of cases. The Department has no

basis on which to dispute the industry’s

statement that its average defense costs,

in cases that proceed beyond an initial

denial of benefits by the district

director, are $6,000. In fact, the

economic analysis prepared for the

Department in connection with the

Regulatory Flexibility Act adopted the

figures provided by the Milliman &

Robertson economic analysis with

respect to the costs of litigating claims

at various levels of adjudication.

Rulemaking Record, Exhibit 80 at 42.

The Department’s second notice of

proposed rulemaking, however,

undermined the assumption that all of

an employer’s defense costs would be

expended at the earliest stage of

adjudication. Under the Department’s

first proposal, an employer would have

been required to develop all of its

evidence regarding both its liability as

an operator and the claimant’s eligibility

while the case was pending before the

district director. The Department’s

second notice of proposed rulemaking,

however, proposed a substantial

alteration in procedure that would

permit parties to maintain their current

practice of deferring the development of

medical evidence until after a case has

been referred to the Office of

Administrative Law Judges. 64 FR

54993 (Oct. 8, 1999). The Department

has adopted this second proposal in

these final regulations. Consequently,

while potentially liable operators will

be required to develop evidence

relevant to their liability while claims

are pending before the district directors,

they will no longer need to expend

money on the development of medical

evidence in those cases (70% of cases,

according to industry estimates) that do

not proceed beyond the district director

level. In addition, the Department has

further revised its regulations to require

that all but one potentially liable

operator, the one finally designated as

responsible operator, be dismissed as

parties to the case upon issuance of the

district director’s proposed decision and

order. See § 725.418(d) and explanation

accompanying § 725.414. Thus, only

one potentially liable operator will

incur costs in the adjudication of each

claim for benefits beyond the district

director level.

Under the revised regulations,

potentially liable operators will be

required to submit evidence to the

district director in each case regarding

their employment of the miner. See

§ 725.408. In addition, in the small

number of cases in which the

Department does not name the miner’s

most recent employer as the responsible

operator, the earlier employer that has

been designated the responsible

operator may incur additional costs in

attempting to establish that a more

recent employer should be held liable

for the payment of benefits. In

comparison to the costs of developing

medical evidence, however, the

Department believes that the additional

costs imposed by the regulations will

not be significant.

The industry submitted an additional

analysis by Milliman and Robertson to

the Department in response to the

second notice of proposed rulemaking.

Rulemaking Record, Exhibit 89–37,

Appendix A. That analysis abandons

the assumption that the Department’s

regulations will cause the expenditure

of $6,000 in defense costs in every case,

rather than only those that proceed

beyond the district director level, and

replaces it with an assumption that

claims defense costs will rise from their

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79985

current level of $6,314 to $12,000 under

the new regulations. Rulemaking

Record, Exhibit 89–37, Appendix A at

16. It is this analysis, apparently, that

gives rise to the statement that the

second notice of proposed rulemaking

will result in an additional $6,000 in

costs per claim. The economic analysis

contains no explanation for its

assumption that defense costs will

double under the new regulations.

Because the Department’s regulations

will actually reduce the quantity of

medical evidence a party may submit

from former levels, eliminate the need

to expend money on developing

medical evidence in the majority of

cases, and eliminate potentially liable

operators other than the designated

responsible operator as parties to each

case beyond the district director level,

the Department believes that the

assumption is incorrect.

(e) No other comments have been

received concerning this regulation.

20 CFR 725.408

(a) The Department proposed

eliminating 20 CFR § 725.408 (1999) in

its first notice of proposed rulemaking,

and replacing it with a regulation

designed to elicit necessary information

from a miner’s former employers. 62 FR

3355–56 (Jan. 22, 1997). As proposed,

§ 725.408 required any operator notified

of its liability under § 725.407 to file a

response within 30 days of its receipt of

that notification, indicating its intent to

accept or contest its identification as a

potentially liable operator. Specifically,

an operator that contests its liability was

required to admit or deny five assertions

relevant to that liability: (1) That it

operated a coal mine after June 30, 1973;

(2) that it employed the miner for a

cumulative period of not less than one

year; (3) that the miner was exposed to

coal mine dust while employed by the

operator; (4) that the miner’s

employment with the operator included

at least one working day after December

31, 1969; and (5) that the operator is

financially capable of assuming its

liability for the payment of benefits. The

regulation required the operator to

submit all documentary evidence

relevant to these issues while the case

was pending before the district director,

within 60 days from the date on which

the operator received notification.

In its second notice of proposed

rulemaking, the Department responded

to comments that the 60-day time period

was too short by enlarging it to 90 days.

64 FR 54990–91 (Oct. 8, 1999). In

addition, the Department observed, the

period could be extended by the district

director for good cause shown pursuant

to § 725.423. The Department also

acknowledged that, as proposed, the

regulation required potentially liable

operators to develop and submit

evidence in cases that ultimately did not

proceed beyond the earliest stage of

adjudication. The Department stated

that the district director’s receipt of this

information was necessary, however, in

order to ensure that the correct parties

were named in those cases that did

proceed to the Office of Administrative

Law Judges. The Department stated that

it did not believe that the cost of

developing this evidence would be

significant. Finally, the Department

rejected the suggestion that it bifurcate

the administrative law judge’s

resolution of entitlement and liability

issues.

(b) The Department has modified

subsection (a)(1), and has added the

phrase ‘‘any of’’ to subsection (a)(3), to

clarify the meanings of those sentences.

(c) One comment argues that the

Department’s revision of this regulation

injects additional complexity, adds

unnecessary burdens and expense in

cases involving multiple operators, and

sets traps for unwary litigants. The

commenter also argues that the

Department’s revision is based on the

erroneous premise that operators are

always better informed as to their

employment of the miner. The

Department agrees that the revised

regulations place additional burdens on

coal mine operators who have, in the

past, routinely filed form controversions

of their liability for benefits and waited

until the case was referred to the Office

of Administrative Law Judges to

develop their defenses. In its first notice

of proposed rulemaking, the Department

explained its intention to change this

practice in order to provide the district

director with sufficient information to

allow him to identify the proper

responsible operator. Requiring the

submission to the district director of all

evidence relevant to the liability issue

has become even more important in the

final revision of the Department’s rules.

As revised, the regulations will permit

the district director to refer a case to the

Office of Administrative Law Judges

with no more than one operator as a

party to the claim, the responsible

operator as finally designated by the

district director. See § 725.418(d) and

explanation accompanying § 725.414.

The regulations prohibit the remand of

cases for the identification of additional

potentially liable operators, or to allow

the district director to designate a new

responsible operator, thereby reducing

delay in the adjudication of the merits

of a claimant’s entitlement. This change

also places the risk that the district

director has not named the proper

operator on the Black Lung Disability

Trust Fund, however. 62 FR 3355–56

(Jan. 22, 1997). The Department believes

that the additional demands placed

upon potentially liable operators are not

unreasonable. In addition, the

Department does not accept the

criticism that the regulation sets traps

for unwary litigants. The nature of the

evidence required by the Department,

and the time limits for submitting that

evidence, are clearly set forth in the

regulations, and will be communicated

to potentially liable operators who are

notified of a claim by the district

director.

The commenter also argues that the

Department’s revision is based on the

erroneous premise that operators are

better able to obtain information about

their employment of the miner than is

the government. The commenter states

that the situation is made more difficult

where the employment relationship was

remote in time or if the miner worked

for many different companies. The

Department agrees that, in some cases,

it may be more difficult for employers,

and particularly for insurers, to readily

ascertain the facts of the miner’s

employment. Clearly, however,

operators and insurers are in a better

position to ascertain these facts than is

the Department of Labor. To the extent

that an employer or insurer has

difficulty in obtaining evidence in a

specific case, it may ask that the time

period for developing this evidence be

extended. The Department will provide

the operators notified of a claim the

information that it has, including a copy

of the miner’s application and all

evidence relating to his coal mine

employment, § 725.407(c).

(d) One comment argues that the 90-

day time limitation for an operator to

submit documentary evidence in

support of its position as to liability

remains inadequate, and that, in any

event, it should not commence until the

operator receives the claimant’s

employment history, the Itemized

Statement of Earnings obtained from the

Social Security Administration, and,

where applicable, the policy number of

the insurance policy that the

Department believes provides

appropriate coverage. The Department

intends to make every effort to supply

a potentially liable operator notified of

a claim with all of the information

pertinent to that notification. As noted

above, this information will include a

copy of the employment history

provided by the claimant. The

Department will also provide the

applicable insurance policy number if it

has it. Similarly, if the Department has

received the Itemized Statement of

79986 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Earnings, it will provide a copy to the

potentially liable operator. The

Department’s receipt of that record,

however, depends on the speed with

which the Department’s request is

processed by the Social Security

Administration. It will not be possible

in all cases to supply that record to

potentially liable operators at the time

they receive notification. The initial

information supplied to the operator

should nevertheless be sufficient to

allow it to accept or reject its

notification as a potentially liable

operator. If the operator needs

additional time to respond to that initial

notification, it may request an extension

of time for good cause shown pursuant

to § 725.423. Operators are not limited

to a single extension of time in which

to obtain this evidence, although a

district director may reasonably expect

the operator to demonstrate its diligence

prior to requesting an additional

extension.

(e) Several comments have

misconstrued the requirements of

§ 725.408. Two comments argue that the

proposal would shift the burden to the

named responsible operator to

investigate the proper responsible

operator within 90 days and that the 90-

day time period is unrealistic for that

purpose. One comment argues that the

revised regulations are objectionable

because they make a responsible

operator responsible not only for its

own defense but also for the defense of

other potentially liable operators. This

statement has never been true with

respect to liability determinations, and,

under the Department’s final

regulations, is no longer true of

entitlement determinations. Another

comment argues that DOL’s rationale for

imposing this time limit on operators—

i.e., that operators have better access to

the claimant’s entire work record—is

flawed. Section 725.408, however, does

not govern the introduction of evidence

relevant to the liability of other

operators that employed the miner.

Instead, the evidence required by

§ 725.408 is limited to evidence relevant

to the notified operator’s own

employment of the miner and that

operator’s financial status. Documentary

evidence relevant to another operator’s

liability is required later pursuant to the

schedule established pursuant to

§ 725.410(b), and in accordance with the

limitations set forth in § 725.414(b).

Accordingly, the Department will

discuss these comments under

§§ 725.410 and 725.414.

(f) One comment argues that by

creating adversity among the miner’s

former employers, the Department’s

revised regulations will create ethical

problems for the limited pool of

attorneys who currently represent

employers in black lung benefits cases,

and will therefore deprive employers of

their right to the counsel of their choice.

The Department acknowledges that the

revised regulations increase the

adversity among a miner’s former

employers in any case in which the

district director has designated as the

responsible operator an operator other

than the operator that most recently

employed the miner. In such a case,

where the designated responsible

operator may seek to develop evidence

to show that a more recent employer

should be designated the responsible

operator, an attorney clearly could not

represent both employers. Moreover, to

the extent that the attorney has

previously represented one of the

operators, the applicable ethical rules of

the attorney’s state bar may prevent the

attorney from accepting representation

of the other operator. In most cases,

however, this problem will be more

illusory than real. Most of the cases in

which the Department will name more

than one potentially liable operator will

be cases in which the miner’s most

recent employer is out of business, and

had no insurance, or cannot be located.

As a general rule, these employers

typically have not participated in the

adjudication of earlier black lung

benefits claims. Accordingly, there will

be few, if any, attorneys who will be

unable to represent the designated

responsible operator. Moreover, in cases

in which the interests of potentially

liable operators are not directly adverse,

state rules typically permit an attorney

to represent a client, even if the attorney

has represented another party to the

case previously, if the attorney obtains

the consent of the previous client.

The Department recognizes that there

may be a small minority of cases in

which a true conflict is unavoidable. For

example, if the miner’s most recent

employer, ABC Coal Co., denies that it

employed the claimant as a miner, the

Department may also name the miner’s

next most recent employer, XYZ Coal

Co., as a potentially liable operator. An

attorney who represented ABC in

previous litigation could not now

represent XYZ, whose interests are

directly adverse. The possibility of such

a conflict, however, is not a limitation

on the Department’s efforts to revise the

regulations implementing the Black

Lung Benefits Act. The Administrative

Procedure Act does guarantee a party

the right to be represented by counsel

during an administrative adjudication. 5

U.S.C. 555(b). Contrary to the

commenter’s suggestion, however,

nothing in that Act requires an

administrative agency to structure its

rules in order to preserve the ability of

a limited number of attorneys to

represent coal mine operators. Where

the state ethics rules require an attorney

to decline representation of a client, that

client is entitled to seek other counsel.

The Department does not believe that

coal mine operators will be unable to

find competent counsel to represent

their interests. In fact, the Department

has included two or more coal

companies as parties in cases under the

former regulations, see, e.g., Martinez v.

Clayton Coal Co. et al., 10 Black Lung

Rep. (MB) 1–24 (Ben. Rev. Bd. 1987)

(involving three coal mine operators),

and did not receive any reports that the

operators encountered problems in

obtaining representation.

(g) One comment states that the

regulation denies mine operators a

reasonable opportunity to develop a

record. In its second notice of proposed

rulemaking, the Department explained

its belief that the 90-day time period,

which may be extended for good cause,

affords sufficient time for operators to

submit evidence relevant to their

employment of the miner. 64 FR 54990

(Oct. 8, 1999). It cannot be emphasized

too often that the period provided by

§ 725.408 does not require the

development of evidence relevant to the

designation of other potentially liable

operators as the responsible operator.

That evidence will be submitted later, in

accordance with the schedule

established by the district director

pursuant to § 725.410.

(h) One comment argues that the

regulation creates an impermissible

presumption and thus violates the

Supreme Court’s decision in Director,

OWCP v. Greenwich Collieries, 512 U.S.

267 (1994). Section 725.408 does not

create any presumptions. To the extent

that the commenter objects to any other

presumption used to establish the

identity of the responsible operator

liable for the payment of benefits, the

Department discussed similar objections

in its second notice of proposed

rulemaking, see 64 FR 54972–74 (Oct. 8,

1999), and its response to comments

under § 725.495 of Subpart G of this

part.

(i) One comment states the response

time given potentially liable operators

under § 725.408 should mirror the time

period given claimants to submit

information in § 725.404. The

Department disagrees. Section 725.404

provides that claimants must provide

the district director with a complete and

detailed employment history as well as

proof of age, marriage, death, family

relationship, dependency, or other

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79987

matters of public record. If the

information submitted by the claimant

is insufficient, the district director must

give the claimant a specified reasonable

period of time within which to provide

the information. Claimants applying for

benefits have a positive incentive to

supply this information; without it, the

district director is unable to complete

processing of the case, and any award of

benefits will necessarily be delayed. In

contrast, § 725.408 seeks information

from the claimant’s former employers,

who have no similar incentive to

provide information to the Department.

The regulation thus establishes a

presumptively reasonable period of time

within which an employer must provide

that information, and allows the

employer to seek an extension of that

period for good cause. Because

§§ 725.404 and 725.408 affect different

parties with different incentives, and

serve different purposes, the

Department does not believe that the

time periods need be made identical.

(j) One comment urges that operators

be given the 60 days originally proposed

by the Department to respond to

notification of potential liability rather

than 90. The Department has retained

the 90-day time period, which may be

extended for good cause, to

accommodate the operator community’s

general objection to the 60-day period

and to provide additional time, as a

matter of right, in that small percentage

of cases in which the miner’s

employment history is complex or in

the distant past.

(k) No other comments were received

concerning this regulation, and no other

changes have been made in it.

20 CFR 725.409

(a) The Department proposed revising

§ 725.409 in its first notice of proposed

rulemaking to make explicit one basis

for denying a claim by reason of

abandonment. The Department observed

that the Court of Appeals for the Fourth

Circuit had confirmed the Department’s

use of the authority in subsection (a)(3)

to dismiss a claim by reason of

abandonment based on a claimant’s

failure to appear at an informal

conference. Wellmore Coal Co. v.

Stiltner, 81 F.3d 490, 497 (4th Cir.

1996). The Department proposed to add

subsection (a)(4) to the regulation to

clarify that authority. In addition, the

Department proposed to clarify the

procedures for denying claims by reason

of abandonment. 62 FR 3356 (Jan. 22,

1997). In the second notice of proposed

rulemaking, the Department explained

that, because of the severe effect of a

dismissal, it had proposed revising

§ 725.416, the regulation governing

informal conferences, to ensure that the

parties to a claim are provided with the

district director’s reasons for holding an

informal conference. Thus, under

revised § 725.416, the district director is

required to explain why he believes an

informal conference will assist in the

voluntary resolution of the issues in the

case. The Department also rejected a

suggestion that an administrative law

judge should be permitted to hear the

merits of claimant’s entitlement in a

case in which the claimant has

requested a hearing as to the district

director’s dismissal of the claim, and the

ALJ finds error in the district director’s

denial of the claim by reason of

abandonment. In response to this

comment, the Department added a

sentence to subsection (c) of the

regulation, to clarify its intent that an

administrative law judge must remand a

case for further administrative

processing if he finds the district

director erred in denying the claim.

Finally, the Department rejected a

comment that the proposal would

increase the number of additional

claims filed.

(b) Two comments continue to object

to the Department’s unwillingness to

allow an administrative law judge to

consider the merits of a claimant’s

entitlement to benefits if he finds that

the district director improperly denied

the claim by reason of abandonment. In

its second notice of proposed

rulemaking, the Department explained

that a denial by reason of abandonment

may take place before the administrative

processing of the claim has been

completed, such as when a claimant

unjustifiably refuses to attend a required

medical examination. § 725.409(a)(1); 64

FR 54991 (Oct. 8, 1999). The

Department has reconsidered its

complete prohibition on allowing an

administrative law judge to resolve the

merits of a claim, however. Where the

parties have completed their submission

of evidence to the district director, and

the district director has completed his

analysis of the evidence relevant to the

liability of all potentially liable

operators, and has made a final

designation of the responsible operator

liable for the payment of benefits, the

Department agrees that it would make

no sense to require remand to the

district director in the event the

administrative law judge overturns his

denial by reason of abandonment.

Accordingly, the Department has

revised subsection (c) to permit the

Director, through the Office of the

Solicitor, to make a case-by-base

determination as to whether remand for

further administrative processing is

necessary. If further remand would be

pointless, the Director’s consent, which

must be made in writing, would allow

the case to proceed on the merits of the

claimant’s entitlement to benefits. The

Department has also added a new

sentence to subsection (c) to clarify the

effect of a denial of a claim by reason

of abandonment on a subsequent claim

filed by the same individual.

(c) Several comments state that the

Department should refer a claim for a

hearing on the merits even if the claim

has been denied by reason of

abandonment. The Department

disagrees. A claimant whose claim has

been denied by reason of abandonment

has suggested, by his actions, that he no

longer wishes to pursue his claim for

benefits. Referring all of these cases to

an administrative law judge for hearing

would be pointless and inefficient. It is

true that in some cases, the claimant

may have decided that he still desires

benefits, but believes that the action

required of him by the district director

is unreasonable. Requiring these

claimants to request an administrative

law judge to resolve their dispute does

not impose an unreasonable burden.

Accordingly, the Department has not

altered this requirement in the

regulation.

(d) Several comments request that the

Department reconsider denying a claim

by reason of abandonment as an

appropriate sanction. Another comment

supports the denial. The Department

explained its reason for using a denial

by reason of abandonment where a

claimant fails to attend an informal

conference in its second notice of

proposed rulemaking. 64 FR 54991–92

(Oct. 8, 1999). The Department

continues to believe that, although a

denial is a harsh sanction, it is the only

valid sanction that may be imposed for

a claimant’s failure to participate in the

adjudication process. A claimant whose

failure to participate is the result of

simple negligence may avoid that

sanction by indicating his willingness to

comply with the district director’s

initial instructions.

(e) Several comments request that the

Department reconsider its use of

informal conferences. These comments

are more appropriately addressed under

§ 725.416.

(f) No other comments were received

concerning this section.

20 CFR 725.410–725.413

(a) In its first notice of proposed

rulemaking, the Department proposed

new §§ 725.410–725.413 in order to

streamline the investigation and initial

adjudication of claims for black lung

benefits. 62 FR 3356 (Jan. 22, 1997). The

79988 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

proposed regulations provided for

concurrent investigations into the

medical issues surrounding the

claimant’s eligibility and the identity of

the operator liable for the payment of

any benefits. Under the proposed

regulations, those investigations would

have culminated in an initial finding

containing the district director’s

preliminary resolution of both issues. If

any party indicated dissatisfaction with

the initial finding, the district director

would have proceeded to an initial

adjudication of the claim and would

have established a schedule for the

submission of evidence. The proposed

regulations included a number of

significant changes. For example, the

Department stated that it would not

honor hearing requests made before the

conclusion of administrative

proceedings. In addition, the

Department provided claimants with up

to one year to respond to an initial

finding.

In its second notice of proposed

rulemaking, the Department did not

discuss §§ 725.410, 725.412, or 725.413.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999). The Department did discuss

§ 725.411, although it did not propose

any additional changes to that

regulation. Instead, the Department

advised all interested parties that it

intended to substantially revise the

documents used in connection with the

issuance of an initial finding under

§ 725.411. The Department noted its

commitment to improve the quality of

the information provided to parties to

the adjudication of black lung claims.

The Department hoped that improved

communication would make district

office claims processing easier to

understand and would also give

claimants a clearer picture of the

medical evidence developed in

connection with their claims. It was

hoped that with better information,

claimants would be able to make more

informed decisions as to how to

proceed. In response to a number of

comments, the Department stated that a

hearing request filed within one year of

the initial finding would constitute a

request for further adjudication of the

claim. The Department also discussed

its decision not to honor premature

hearing requests, i.e., requests for

hearing made before the district director

issued a proposed decision and order.

Additionally, the Department rejected

the suggestion that the one-year

response time to an initial finding

impermissibly extended a claimant’s

modification rights. Finally, the

Department explained its decision not

to permit an extension under § 725.423

of the one-year time period.

(b) A number of comments continue

to object to the Department’s proposal

with respect to the initial adjudication

of claimant eligibility and operator

liability. Among other things, these

commenters criticize the increased

formality and complexity of the

proposed procedure; the burdensome

requirement that operators must

respond to initial findings in all cases;

and the Department’s failure to honor

premature hearing requests. In response

to these comments, the Department has

reconsidered the procedural rules

governing district director claims

processing, and has altered the proposal

in a number of significant respects.

(i) The Department will no longer

issue an initial finding of claimant

eligibility and operator liability. Instead,

following the development of certain

medical evidence under § 725.405,

including the complete pulmonary

evaluation authorized by § 725.406, and

the submission of evidence relevant to

the employment of the miner by

potentially liable operators notified

pursuant to § 725.407, the district

director will issue a schedule for the

submission of additional evidence.

§ 725.410. This schedule will notify the

parties of the district director’s

preliminary evaluation of the evidence

regarding the miner’s eligibility, but will

not require a formal response as to

eligibility from any party. In the event

that the district director concludes that

the evidence supports an award of

benefits, and there is no operator that

may be held liable for the payment of

benefits, § 725.411 requires the district

director to issue immediately a

proposed decision and order awarding

benefits payable by the Black Lung

Disability Trust Fund. In such a case,

the district director will not issue a

schedule for the submission of

additional evidence because no further

evidentiary development is needed. In

the event the district director’s

preliminary evaluation of the medical

evidence in a Trust Fund case weighs

against a benefits award, the district

director will issue a schedule allowing

the submission of additional medical

evidence, but the claimant need not

respond. Instead, the claimant may wait

until the issuance of the proposed

decision and order, which will provide

him 30 days within which to request a

hearing. Similarly, an operator need not

respond to a district director’s schedule

for the submission of evidence. Silence

on an operator’s part as to the claimant’s

entitlement to benefits after issuance of

the district director’s schedule will be

deemed a contest of that entitlement.

The revised regulations thus eliminate

certain responses that previously would

have been required following issuance

of the proposed initial findings. In

addition, they eliminate the one-year

period of time that the proposal would

have provided a claimant to respond to

the initial finding. Two commenters

continued to object to that time period.

Instead, all parties will have the

statutory period, one year, to file a

request for modification after the district

director’s proposed decision and order

becomes effective. The proposed

decision and order becomes effective 30

days after issuance, see § 725.419.

By replacing the notice of initial

finding with a less formal schedule for

the submission of additional evidence,

the Department hopes to further its goal

of providing more easily understood

documents. The schedule will

summarize the medical evidence

developed by the Department, and

provide a clear explanation of why that

evidence may fail to establish a

claimant’s entitlement to benefits. In

addition, the schedule will provide a

clear explanation of the steps remaining

in the district director’s claim

processing. A number of commenters

had objected to the complexity of the

Department’s proposed procedures, and

the Department believes that this

simplified, revised process will

eliminate confusion.

(ii) The schedule will also contain the

Department’s preliminary designation of

the responsible operator liable for the

payment of claimant’s benefits. Along

with the schedule, the district director

will supply all potentially liable

operators with a copy of the evidence

needed to meet the Director’s initial

burden of proof under § 725.495, if such

a showing is necessary. Within 30 days

of the date on which the schedule is

issued, the designated responsible

operator must either agree or disagree

with the district director’s designation.

If it disagrees, it must submit any

evidence regarding the liability of other

operators in accordance with the district

director’s schedule. The schedule must

provide a minimum of 60 days to

submit evidence pertaining to both

responsible operator liability and the

claimant’s entitlement, and an

additional 30 days to respond to other

parties’ evidence. These periods may be

extended pursuant to § 725.423 for good

cause shown. In addition, the

designated responsible operator may,

but does not have to, agree that the

claimant is entitled to benefits. Silence

on this issue for 30 days after the

district director issues a schedule will

be deemed a decision to contest the

claimant’s benefit entitlement sufficient

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79989

to make the responsible operator liable

for a reasonable attorney’s fee if the

claimant successfully prosecutes his

claim.

(iii) The Department has also deleted

the language in proposed § 725.411

which would have rendered invalid

premature hearing requests.

Accordingly, the Department will

continue its current practice of

following the decision in Plesh v.

Director, OWCP, 71 F.3d 103, 111 (3d

Cir. 1995). Under that decision, the

Department may complete its

administrative processing of the claim,

but must forward a claim for a hearing

at the conclusion of that processing if

the claimant has previously filed a

request for a hearing and that request

has not been withdrawn. The

Department has revised § 725.418 to

accomplish this result and to extend

similar treatment to operators. See

response to comments under § 725.418.

(c) Two comments submitted in

connection with the Department’s first

notice of proposed rulemaking, and

renewed in connection with the

Department’s second notice of proposed

rulemaking, argue that the Department’s

proposed § 725.413 improperly transfers

adjudication powers from the

administrative law judge to the district

director in violation of the

Administrative Procedure Act. The

Department disagrees. The regulations

currently permit the district director to

issue a proposed decision and order.

Any party aggrieved by the proposed

decision and order may request a formal

hearing before the Office of

Administrative Law Judges, making the

district director’s factual findings

irrelevant. If no party objects to the

proposed decision and order, however,

it becomes final. 20 CFR 725.419 (1999).

The revised regulations continue that

procedure. They do not deny any party

the right to an adjudication of contested

issues by an administrative law judge,

as provided by both the Administrative

Procedure Act, 5 U.S.C. 556, and section

19 of the Longshore and Harbor

Workers’ Compensation Act, 33 U.S.C.

919, as incorporated by 30 U.S.C. 932(a).

(d) Several comments submitted in

connection with the Department’s first

notice of proposed rulemaking state that

the time frames for developing and

submitting evidence to the district

director are too short. These time

frames, which have been moved from

proposed § 725.413(c)(2) to § 725.410(b),

set only the minimum periods for

evidentiary submissions. Section

725.423 allows any party to request

additional time within which to take a

required action if good cause is shown.

In addition, the Department has relaxed

the requirements for the development of

documentary medical evidence in

§§ 725.414 and 725.456, and has

increased the opportunities for

submitting such evidence outside the

periods established by § 725.410. The

Department has not modified, however,

the requirement contained in the

original proposal, that all documentary

evidence pertaining to operator liability

must be submitted to the district

director in the absence of extraordinary

circumstances. In a small number of

claims, the responsible operator

designated by the district director may

wish to submit documentary evidence

to meet its burden of establishing that

another employer of the miner should

be the responsible operator. The

Department estimates that these cases

will represent less than 10 percent of all

responsible operator claims. The

Department recognizes that, in some of

these cases, the initial 60-day period

may be insufficient to allow the

designated responsible operator to

complete its development of the

necessary evidence. In such a case,

however, the operator may request that

the district director grant it additional

time. In addition, if the district director

finds the evidence submitted by the

designated responsible operator

persuasive, he may designate a different

operator as the responsible operator

only after he provides that operator,

pursuant to § 725.410, with at least 60

additional days to develop its own

evidence relevant to both the liability

and eligibility issues. Finally, in a case

in which the operator encounters

particular difficulty in obtaining the

necessary evidence, it may be able to

establish the existence of ‘‘extraordinary

circumstances’’ permitting the

introduction of such evidence after the

case is referred to the Office of

Administrative Law Judges. No changes

are necessary in response to these

comments.

(e) One comment submitted in

connection with the Department’s first

notice of proposed rulemaking objects to

the district director’s authority to

reinstate an operator which has been

dismissed. This authority is necessary to

correct erroneous dismissals, especially

since an operator can not be named a

party to a claim once a case is referred

to the Office of Administrative Law

Judges for a hearing on the merits,

§ 725.407(d). The remainder of the

commenter’s objections pertain more

properly to § 725.414, and are addressed

under that regulation.

(f) In light of the extensive changes to

§§ 725.410–.413, none of the other

comments received concerning the

proposed revisions to these regulations

remain relevant.

20 CFR 725.414

(a) In its first notice of proposed

rulemaking, the Department proposed to

limit the quantity of documentary

medical evidence that parties to a claim

would be able to submit. Specifically,

the Department’s initial proposal would

have permitted the claimant and the

party opposing the claimant’s

entitlement each to submit the results of

no more than two complete pulmonary

examinations or consultative reports,

and one review of each of its opponent’s

diagnostic studies and examinations.

Parties could submit additional

documentary medical evidence only by

demonstrating extraordinary

circumstances. In proposing this

limitation, the Department

acknowledged the concerns of the Court

of Appeals for the Sixth Circuit in

Woodward v. Director, OWCP, 991 F.2d

314, 321 (6th Cir. 1993). In that

decision, the court noted the superior

financial resources of some parties

allowed the development of a greater

quantity of evidence with the result that

the ‘‘truth-seeking function of the

administrative process is skewed and

directly undermined.’’ 991 F.2d at 321.

62 FR 3356–61 (Jan. 22, 1997). In cases

in which the Department named more

than one potentially liable operator as a

party to the claim, the proposal

delegated responsibility for the

development of documentary medical

evidence to the responsible operator

designated by the district director. Other

operators would be permitted to submit

documentary medical evidence, up to

the limit of two medical evaluations per

side, only by showing that the

designated responsible operator had not

undertaken a full development of the

evidence and that, without it, the

potentially liable operator was unable to

secure a full and fair litigation of the

claimant’s eligibility.

The Department also proposed to

require that all documentary evidence—

evidence relevant to operator liability as

well as medical evidence relevant to a

claimant’s eligibility—be submitted

while the case was pending before the

district director. Like the limitation on

the quantity of medical evidence, the

required submission of evidence to the

district director was made subject to an

extraordinary circumstances exception.

The Department observed that this

proposal would end parties’ current

practice of delaying the development of

evidence on both issues until a claim

was referred to the Office of

Administrative Law Judges. It would

also provide district directors with a

79990 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

better evidentiary record on which to

adjudicate a claim. The proposal would

have required parties to identify all of

their witnesses while a case was

pending before the district director.

Finally, the Department explained that

both proposed revisions were

permissible exercises of the broad

regulatory authority granted the

Department under the Black Lung

Benefits Act.

The Department proposed several

significant revisions in its second notice

of proposed rulemaking. 64 FR 54992–

96 (Oct. 8, 1999). Responding to

numerous comments, the Department

withdrew its proposed requirement that

all documentary medical evidence be

submitted to the district director.

Instead, the Department proposed to

retain the current procedures, allowing

parties to submit documentary medical

evidence to the Office of Administrative

Law Judges up to 20 days prior to the

formal hearing. See preamble to

§ 725.456. The Department did not

revise its proposal with respect to

documentary evidence relevant to the

issue of operator liability, however. Any

such evidence that was not submitted to

the district director could be submitted

to the administrative law judge only

upon a showing of extraordinary

circumstances. The Department

observed that this proposal represented

a weighing of the claimant’s interest in

the prompt adjudication of his

entitlement against the interest of the

Department in protecting the Black

Lung Disability Trust Fund from

unwarranted liability. Under the

Department’s proposal, the Director,

OWCP, would be unable to have a case

remanded to the district director for the

development of additional evidence as

to operator liability once a case was

referred to the Office of Administrative

Law Judges for an adjudication of the

merits. This provision helped to ensure

the prompt adjudication of the

claimant’s entitlement. The procedure

also subjected the Trust Fund to the

risk, however, that a district director

would not name the correct operator as

a party to the claim before the case was

referred to OALJ. Such a risk could be

justified only if the district director was

able to examine all of the documentary

evidence relevant to the issue of

operator liability.

Although numerous comments had

objected to the Department’s limitation

on the quantity of medical evidence, the

Department did not propose to alter that

limitation. In order to accommodate the

differing circumstances of individual

cases, however, and to ensure that all

parties were given due process, the

Department proposed revising the

standard that would allow a party to

exceed that limitation. Accordingly, the

Department replaced the ‘‘extraordinary

circumstances’’ exception with a ‘‘good

cause’’ standard that would be easier to

meet in appropriate cases. The

Department also clarified the types of

documentary medical evidence that

parties would be entitled to submit, in

order to resolve some of the ambiguities

presented by its original proposal.

Specifically, the Department proposed

that a party’s affirmative case be limited

to two chest X-ray interpretations, the

results of two pulmonary function

studies, two arterial blood gas studies,

and two medical reports. In rebuttal,

each party would be able to submit one

piece of evidence analyzing each piece

of evidence submitted by the opposing

side. For example, an operator could

have each of the claimant’s chest X-rays

reread once, and could submit one

report challenging the validity of each

pulmonary function test submitted by

the claimant. The Department also

provided the parties with an

opportunity to rehabilitate the evidence

they had submitted in connection with

their affirmative case that had been the

subject of rebuttal. The second proposal

justified the medical evidentiary

limitations as applied to multiple

potentially liable operators named as

parties to the same claim. Finally, the

Department clarified the provision in

subsection (a)(4) as allowing the

submission of hospital records and any

other treatment records relating to the

mine’s respiratory or pulmonary

condition without regard to the

evidentiary limitations elsewhere in the

regulation.

(b) A number of comments continue

to object to the proposed requirement

that more than one potentially liable

operator might be retained as a party to

a claim and might have to participate in

a joint defense of the claimant’s

eligibility for benefits subject to the

same medical evidentiary limitations as

would be present in a case involving

only one operator. The Department

proposed this requirement in order to

ensure that a claimant in a multiple

operator case—a case in which the

identity of the responsible operator was

in doubt—would not have to face more

documentary medical evidence than a

claimant whose eligibility was opposed

by only one potentially liable operator.

On further reflection, however, the

Department has decided not to retain

more than one potentially liable

operator as a party to each case after the

case is referred to the Office of

Administrative Law Judges. The final

revisions to the regulations attempt to

simplify and streamline the processing

of claims at the district director level.

For example, the final rules eliminate

certain party responses formerly

required to be filed with the district

director, and thus reduce the parties’

transaction costs. Similarly, in these

final rules, the Department has

simplified the adjudication of claims

beyond the district director level by

permitting the district director to refer a

case to the Office of Administrative Law

Judges with only one designated

responsible operator as a party to the

claim. See explanation accompanying

§§ 725.415, 725.416, 725.417, 725.418,

and 725.421.

The Department recognizes that this

solution may slightly increase the Black

Lung Disability Trust Fund’s liability. In

the event the responsible operator

designated by the district director is

adjudicated not liable for a claim, the

Black Lung Disability Trust Fund will

pay any benefit award. The

Department’s proposals, on the other

hand, would have subjected the Trust

Fund to liability only where the miner

was not employed by any operator that

met the criteria for a potentially liable

operator, or where the district director

had not named as a party to the claim

the operator ultimately held to be the

responsible operator. The Department’s

final regulations create Trust Fund

liability in different circumstances:

where the district director’s designation

of the responsible operator proves to be

incorrect. For example, if the miner’s

most recent employer, ABC Trucking

Co., argues that it did not employ the

claimant as a miner, the proposal would

have permitted the district director to

retain, as parties to the claim, the

miner’s prior employers as fallback

potentially liable operators. Under the

final regulation, however, if the district

director designates ABC as the

responsible operator, and the ALJ

awards benefits but finds that the

miner’s next most recent employer, XYZ

Coal Co., should have been the

responsible operator, benefits will be

payable by the Trust Fund. The

Department intends that, once a claim is

referred to the Office of Administrative

Law Judges, the Department shall not be

able to impose liability for that claim on

any operator other than the one finally

designated as responsible operator by

the district director, whether through

remand by the administrative law judge

or through modification of a finally

awarded claim. This limitation will

eliminate a major source of delays in the

adjudication of claims, and prevent a

claimant from having to relitigate his

entitlement to benefits. To the extent

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79991

that a denied claimant files a

subsequent claim pursuant to § 725.309,

of course, the Department’s ability to

identify another operator would be

limited only by the principles of issue

preclusion. For example, where the

operator designated as the responsible

operator by the district director in a

prior claim is no longer financially

capable of paying benefits, the district

director may designate a different

responsible operator. In such a case,

where the claimant will have to

relitigate his entitlement anyway, the

district director should be permitted to

reconsider his designation of the

responsible operator liable for the

payment of the claimant’s benefits.

The Department does not believe that

the risk of increased Trust Fund liability

is significant. Serious disputes about the

identity of the responsible operator arise

in less than 10 percent of claims. In

addition, the regulations still require

that all of the documentary evidence

relevant to the issue of operator liability

be submitted to the district director, and

that all of the potential witnesses as to

this issue be identified. In fact, the

Department’s willingness to accept the

risk that the district director’s

designation will be incorrect reinforces

the need for both of those requirements.

Thus, the district director will be able

to make a determination as to the

identity of the responsible operator

based on the same information that will

be available to the administrative law

judge. In such circumstances, the

Department believes that any additional

risk of liability imposed on the Trust

Fund is acceptable.

The Department has made extensive

revisions to § 725.414 to implement this

change. Subsection (a)(3)(iv) and the

introductory paragraph of subsection

(a)(3) have been deleted, and references

to potentially liable operators other than

the designated responsible operator

have been removed from subsections

(a)(2)(ii), (a)(3)(i), (a)(3)(ii), and (c). The

Department has revised subsection

(a)(3)(iii) to reflect the Trust Fund’s

right to develop evidence in a case in

which the district director has notified

one or more potentially liable operators

of their liability pursuant to § 725.407,

but has subsequently dismissed all of

the operators. The revised regulation

also recognizes the Trust Fund’s right to

develop and submit evidence relevant to

the compensability of a claimant’s

medical benefits. The Department has

also revised subsections (b)(1) and (b)(2)

to clarify the meaning of the regulation.

In addition, the Department has

deleted subsection (a)(6). As proposed,

subsection (a)(6) would have required

the district director to admit into the

record all of the evidence submitted

while the case was pending before him.

As revised, however, the regulation may

require the exclusion of some evidence

submitted to the district director. In the

more than 90 percent of operator cases

in which there is no substantial dispute

over the identity of the responsible

operator, most of the evidence available

to the district director will be the

medical and liability evidence

submitted pursuant to the schedule for

the submission of additional evidence,

§ 725.410. In the remaining cases,

however, the district director may alter

his designation of the responsible

operator after reviewing the liability

evidence submitted by the previously

designated responsible operator. For

example, he may decide that the

evidence submitted by ABC Trucking

Co. establishes that the claimant did not

work as a miner for that company, and

may designate the claimant’s next most

recent employer, XYZ Coal Co., as the

responsible operator. In such a case, the

regulations require that the district

director issue another schedule for the

submission of additional evidence in

order to give XYZ Coal the opportunity

to submit additional evidence bearing

on its liability for benefits. If the district

director ultimately concludes that XYZ

should be designated the responsible

operator, the regulation requires him to

exclude the medical evidence

previously developed by ABC, unless

XYZ adopts that evidence as its own,

§ 725.415(b). The Department has

revised § 725.415(b) to defer the

development of any additional medical

evidence in such a case until after the

district director has completed his

analysis of all evidence pertaining to

operator liability and has made a final

responsible operator determination. At

that point, the responsible operator will

have an opportunity, if it was not the

initially designated responsible

operator, to develop its own medical

evidence or adopt medical evidence

submitted by the initially designated

responsible operator. Because the

district director will not be able to

determine which medical evidence

belongs in the record until after this

period has expired, the Department has

revised §§ 725.415(b) and 725.421(b)(4)

to ensure that the claimant and the party

opposing entitlement are bound by the

same evidentiary limitations.

Accordingly, the Department has

deleted the requirement in

§ 725.414(a)(6) that the district director

admit into the record all of the medical

evidence that the parties submit.

The Department does not expect the

deletion to have a significant practical

effect. Because the Department

withdrew its first proposal requiring

that all medical evidence be submitted

to the district director, see paragraph (a),

above, the Department expects that

parties generally will not undertake the

development of medical evidence until

the case is pending before the

administrative law judge. Certainly, if

the designated responsible operator

believes itself not to be liable for a given

claim, it might defer the development of

medical evidence while developing

evidence relevant to liability.

Accordingly, in the overwhelming

majority of cases, there will be no

evidence that the district director will

be required to exclude from the record.

The Department recognizes, however,

the theoretical possibility that a

claimant may have to undergo

additional physical examination and

testing. In the example discussed above,

if ABC Trucking had submitted the

result of its examination and pulmonary

testing, XYZ could, if it chose not to use

ABC’s evidence, require the claimant to

submit to an additional examination.

The Department does not believe that

this is a likely scenario, however, even

in cases in which the district director

changes his designation of the

responsible operator.

(c) Two comments dispute the

Department’s observation, in its second

notice of proposed rulemaking, 64 FR

54996 (Oct. 8, 1999), that autopsy and

biopsy reports are generally not

developed in connection with a claim,

and that those reports need not be

addressed in the Department’s

evidentiary limitations. The Department

has reconsidered its earlier proposal

allowing the admission of these reports

without regard to number, and agrees

that the evidentiary limitations of

§ 725.414 should be revised.

Accordingly, the regulation now permits

each side to submit, as part of its

affirmative case, one report of an

autopsy and one report of each biopsy.

Subsections (a)(2)(i) and (a)(3)(i) have

been revised accordingly. In addition,

the Department has revised subsections

(a)(2)(ii) and (a)(3)(ii) to allow each side

to submit one report in rebuttal of an

autopsy report and one report in

rebuttal of each biopsy report offered by

the opposing side. The Department has

also deleted the reference to autopsy

and biopsy reports in subsection (a)(4),

the catch-all provision permitting the

introduction of evidence that is not

addressed elsewhere in § 725.414.

(d) Several comments object to the

Department’s proposed addition of

subsection (e). This provision, which

tracks the current regulation at 20 CFR

725.414(e)(1) (1999), would have

79992 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

prohibited the introduction of evidence

before an administrative law judge

which was obtained by a party while the

claim was pending before a district

director but which was withheld from

the district director or any other party.

Another comment states that the

subsection is meaningless since it

suggests that withheld evidence must be

admitted upon the request of a party,

even absent a showing of extraordinary

circumstances. The Department agrees

that this provision should be deleted.

See preamble to § 725.456, paragraph

(b). Accordingly, subsection (e) has been

deleted. A corresponding change has

been made to § 725.456.

(e) A number of comments argue that

the Department should limit the

claimant and the party opposing

entitlement to one examination and one

set of pulmonary testing. Thus, instead

of being able to submit the results two

pulmonary function studies and two

arterial blood gas studies, each party

would be entitled to submit only one set

of test results. One commenter states

that this revision would simply

maintain the status quo with respect to

testing. The Department disagrees. The

former regulations do not limit the

number of test results a party may

submit, and evidentiary records often

contain a substantial number of such

tests. The Department recognizes that

the testing may be difficult for some

claimants. In the absence of good cause,

the Department’s regulations limit the

maximum total number of tests to five

in the vast majority of cases involving

a designated responsible operator (four

in a case in which the Black Lung

Disability Trust Fund will be liable for

the payment of any benefits), and spread

these tests out over time. The first such

test will be performed in connection

with the complete pulmonary

evaluation shortly after the claimant

files his application, § 725.406. The last

test will most likely be performed

shortly before the formal hearing, as

parties seek to complete the

development of their evidence before

the twentieth day prior to the hearing,

as required by § 725.456(b)(2). It would

not be appropriate to further limit the

testing that a claimant must undergo.

An operator who wishes to submit the

results of two physical examinations

performed in accordance with § 718.104

is entitled to have the physicians who

perform those examinations administer

appropriate testing, see § 718.104(a)(6).

Accordingly, the Department has not

changed the regulation in this respect.

(f) A number of comments continue to

object generally to the Department’s

proposed limitations on the quantity of

medical evidence that parties may

submit in the adjudication of a black

lung claim. Among other things, they

argue that the proposed limitations

violate § 413(b) of the Black Lung

Benefits Act, 30 U.S.C. 923(b), which

requires the consideration of ‘‘all

relevant evidence,’’ and infringe on the

rights of coal mine operators under the

due process clause of the Constitution.

The Department has previously

addressed both arguments. In its first

notice of proposed rulemaking, the

Department explained that § 413(b),

which is contained in Part B of the

Black Lung Benefits Act, was

incorporated into Part C, governing

adjudications by the Department of

Labor, ‘‘to the extent appropriate.’’ 30

U.S.C. 940. The proposed evidentiary

limitations thus represent the extent to

which the Department believes that

medical evidence should be submitted

for consideration by the factfinder. In

addition, the Department has noted that

§ 413(b) does not require the admission

of all evidence simply because that

evidence could be described as relevant,

and that the Department was free to

prescribe conditions under which

evidence would be admissible in black

lung adjudications. 62 FR 3358–59 (Jan.

22, 1997). The Department discussed

the requirements of the due process

clause in its second notice of proposed

rulemaking. The Department observed

that a due process analysis involves

weighing the potentially disparate

interests of a number of parties. 64 FR

54994–95 (Oct. 8, 1999). In the

Department’s view, the regulation

achieves the correct balance,

particularly in light of the Department’s

decision to permit parties to exceed the

numerical limitations on documentary

medical evidence upon a showing of

good cause. To the extent that these

commenters objected, on due process

grounds, to the requirement that

potentially liable operators other than

the responsible operator defer to the

responsible operator’s development of

medical evidence, those objections have

been rendered moot by the Department’s

revisions permitting only one

designated responsible operator to be

included as a party to a case before the

Office of Administrative Law Judges.

The Department also cannot accept

the assertion, made by several

commenters, that the numerical limits

are fundamentally unfair, and that they

will result in inaccurate and incomplete

evaluations of the claimant’s pulmonary

condition. In cases involving a coal

mine operator, the record may contain

up to five medical reports—two

submitted by the claimant, two by the

operator, and the results of the complete

pulmonary evaluation. Each of these

reports may be based on independent

medical testing. Accordingly, the

Department does not agree that the

evaluation of the claimant’s medical

status will be less than complete and

thorough. Moreover, the Department

does not agree that requiring the parties

to develop medical evidence meeting

certain quality standards, §§ 718.102—

718.107, will result in an unfair

adjudication of the claimant’s

entitlement to benefits.

(g) One comment suggests that the

Department’s rationale for its proposed

change is insufficient, and that

anecdotal evidence of a few cases in

which coal mine operators submitted a

large volume of evidence does not

demonstrate that the current procedure

is unfair. The commenter further argues

that the former system, developed under

the Administrative Procedure Act, is a

fair system. The Department agrees that

the APA generally provides a fair basis

for the adjudication of parties’ interests

in the administrative context. In its first

notice of proposed rulemaking,

however, the Department demonstrated

that Congress did not explicitly impose

the requirements of the APA on

adjudications under the Federal Mine

Safety and Health Act. See 62 FR 3359

(Jan. 22, 1997). In addition, the

Department expressed its preference for

a bright-line test that allows

adjudication officers to resolve issues of

eligibility based on the quality of the

medical evidence developed by the

parties rather than merely the quantity

of evidence that parties with superior

financial resources may be able to

submit. The Department continues to

believe that the adjudications that will

take place under these revised

regulations will result in fairer, more

credible evaluations of black lung

claims than the former system

permitted.

(h) One comment argues that the

‘‘minimum’’ number of examinations

that may be submitted by the parties is

not equal. The commenter also objects

that the claimant is entitled to travel a

longer distance to obtain his medical

evidence than the employer is

authorized to send him to obtain its

medical evidence. Specifically, the

commenter states that a claimant could

travel less than one hundred miles away

for the complete pulmonary evaluation

provided by the Department under

§ 725.406, but then travel a longer

distance to obtain a subsequent

examination at his own expense.

Because the limitation on the travel an

operator can require is tied to the

distance traveled for the § 725.406

evaluation, the commenter argues that

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79993

the claimant could in fact travel much

farther than the operator is permitted to

send him in obtaining its evidence. The

commenter’s emphasis on a ‘‘minimum’’

number of medical reports is puzzling;

since parties on both sides remain free

not to submit any medical evidence, the

Department believes that the commenter

refers to the maximum permissible

number of reports and tests. That

limitation is equally balanced. Unless

the administrative law judge finds that

good cause justifies the admission of

additional evidence, each side may

submit up to two medical reports, two

chest X-ray interpretations, the results

of two pulmonary function studies and

arterial blood gas studies, one report of

each biopsy, and one autopsy report.

The Department believes that the

limitation applicable to each type of

evidence per side represents an

inherently fair way of ensuring that the

adjudication officer’s focus is on the

quality of the evidence submitted rather

than on its quantity. To the extent that

the comment refers to the claimant’s

ability to select the physician to perform

the complete pulmonary evaluation

from among those on the Department’s

list, the Department has responded to

that comment under § 725.406. See

preamble to § 725.406, paragraph (b).

With respect to the travel

requirements, the Department believes

that a coal mine operator should not be

entitled to wait to develop its medical

evidence until after the claimant has

finished his evidentiary development in

order to learn how far it may ask the

claimant to travel. The complete

pulmonary evaluation offers the

claimant the opportunity to travel

anywhere in his state or any contiguous

state at Departmental expense. The

Department does not believe that a

claimant will deliberately select a closer

physician for this examination and then

pay for his own travel to a more distant

location for either of the two medical

reports that he is entitled to submit.

Accordingly, the Department believes

that the distance a claimant travels for

the complete pulmonary evaluation, or

100 miles, whichever is greater,

represents a proper limitation on a coal

mine operator’s ability to compel the

claimant to travel. Moreover, the

regulation’s proscription on additional

travel is not absolute. Like the former

regulation, 20 CFR 725.414(a)(1999),

which subsection (a)(3)(i) mirrors,

subsection 725.414(a)(3)(i) permits an

operator to request the district director

to authorize a trip of greater distance.

Operators who are unable to find a

qualified physician within the 100-mile

radius thus may seek permission to send

the claimant further.

(i) Three comments suggest that the

determination as to whether additional

evidence would provide only marginal

utility should not be made by regulation

of the Department of Labor but by

administrative law judges on a case-bycase basis. These commenters contend it

is up to administrative law judges to

determine when evidence is cumulative

and that the Department should not

micromanage the adjudicatory process.

The Department has previously

expressed its preference for a ‘‘brightline’’ limitation over the ad hoc

determinations of individual

adjudication officers. 62 FR 3357 (Jan.

22, 1997). Where the circumstances

compel a determination of whether

additional medical evidence should be

allowed, i.e., upon an allegation of good

cause for submitting medical evidence

in excess of the evidentiary limitation,

that determination will be made by

administrative law judges. The need for

such a determination in some cases,

however, does not obviate the more

compelling need for a general rule

limiting the amount of medical evidence

that parties may submit in black lung

benefits claims. The Department

believes that it should be incumbent on

the party seeking to exceed that limit to

demonstrate good cause for submitting

additional evidence.

(j) One comment argues that the

Department should include the ‘‘good

cause’’ exception in § 725.414 as well as

in § 725.456, and that its failure to do

so represents a trap for the unwary. The

Department does not agree that the

‘‘good cause’’ exception needs to be

repeated in § 725.414. As a practical

matter, the Department’s removal of the

requirement that parties submit all of

their documentary medical evidence

before the district director will generally

cause parties to delay the development

of their evidence until a case reaches the

administrative law judge. Thus, the

Department does not anticipate that

there will be many occasions on which

a party would ask the district director,

rather than the administrative law

judge, to find ‘‘good cause’’ to exceed

the numerical limitations of § 725.414.

In any event, because any finding on

this issue by the district director would

be subject to de novo review by an

administrative law judge, the

Department does not believe that the

absence of an explicitly stated ‘‘good

cause’’ exception while a case is

pending before the district director will

impair the parties’ development of

evidence.

(k) One comment argues that, contrary

to the opinion expressed in the

Department’s second notice of proposed

rulemaking, the progressive nature of

pneumoconiosis should not constitute

‘‘good cause’’ for the submission of

additional evidence because it is

scientifically unsupported. In its second

notice of proposed rulemaking, the

Department had suggested that the

progressive nature of the disease might

justify an administrative law judge’s

finding of good cause to admit

documentary medical evidence in

excess of the § 725.414 limitations when

both parties had fully developed their

evidence prior to the hearing but the

hearing had to be rescheduled due to

weather conditions. 64 FR 54994–95

(Oct. 8, 1999). The commenter suggests

that a claim of regression should be

automatic good cause. The Department

has discussed the evidence

demonstrating the progressive nature of

pneumoconiosis in its response to

comments under § 725.309. The

Department does not agree that a bare

claim of ‘‘regression’’ should entitle a

coal mine operator to exceed the

§ 725.414 evidentiary limitations. The

example provided by the Department

was intended to illustrate one of the

circumstances in which the ‘‘good

cause’’ exception might apply; it was

not intended to provide an automatic

right to submit documentary medical

evidence in excess of the limitations in

any particular case.

(l) One comment states that the ‘‘good

cause’’ exception is unnecessarily

complex and leaves many unanswered

questions. The commenter poses a

hypothetical situation involving a

claimant’s submission of an additional

report of examination, and asks what

additional evidence the opposing party

may submit in response or in rebuttal.

The Department does not believe that

the regulation or this preamble can

explicitly anticipate every conceivable

situation that may arise in the

adjudication of claims. Instead, the

Department fully expects that

administrative law judges will be able to

fashion a remedy in all cases that both

permits the party opposing entitlement

to develop such rebuttal evidence as is

necessary to ensure a full and fair

adjudication of the claim, and retains

the principle inherent in these

regulations that the fairest adjudication

of a claimant’s entitlement will occur

when the factfinder’s attention is

focused on the quality of the medical

evidence submitted by the parties rather

than on its quantity.

(m) One comment argues that the

Department’s regulations improperly

deny a dismissed operator the right to

defend itself, in violation of the Black

Lung Benefits Act, the Longshore and

79994 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Harbor Workers’ Compensation Act, and

the Administrative Procedure Act.

Under the regulations, if an operator is

dismissed by the district director, and is

not reinstated before a case is referred

to the Office of Administrative Law

Judges, it may not be held liable for

benefits. Such an operator will therefore

not need to defend itself. If the district

director dismisses an operator and later

realizes that he did so incorrectly, he

may reinstate that operator but must

provide it with an opportunity, under

§ 725.410, to develop additional

evidence. Consequently, the Department

does not agree that the regulations limit

the rights of dismissed operators.

(n) One comment states that the

requirement that a party identify a

testifying witness while a claim is

pending before the district director is

unreasonable and onerous, and that it

diminishes the authority of

administrative law judges. This

comment is more appropriately

addressed under § 725.457, governing

the use of witnesses before an

administrative law judge. See preamble

to § 725.457, paragraph (b).

(o) A number of comments generally

favor the Department’s medical

evidentiary limitations.

(p) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 725.415

(a) In its first notice of proposed

rulemaking, the Department revised

§ 725.415 to require the district director

to issue a proposed decision and order

in each case. Citing the need to

strengthen the integrity of the district

director’s adjudication, the Department

proposed removing the district

director’s authority to refer a claim to

the Office of Administrative Law Judges

without first issuing a proposed

decision and order. 62 FR 3361 (Jan. 22,

1997). The Department did not discuss

§ 725.415 in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) The Department has revised

subsection (b) in light of its decision not

to allow more than one operator to

remain a party to a black lung claim

after the conclusion of district director

processing. As revised, the regulation

recognizes the district director’s

authority to reconsider his initial

designation of a responsible operator

following the submission of liability

evidence by that initially designated

operator. Where the district director

believes that that evidence establishes

that the first operator is not the proper

responsible operator, he may issue

another schedule for the submission of

additional evidence under § 725.410,

designating a new responsible operator

and providing that operator with time

within which to submit its own

evidence relevant to the liability issue.

If, after reviewing that operator’s

evidence, the district director decides

that his first designation was correct, he

may not allow the second designated

responsible operator to develop any

additional medical evidence. If,

however, he decides that his second

designation was correct (or proceeds to

a third or fourth designation), he must

provide the operator that he finally

determines to be the responsible

operator with the opportunity to submit

medical evidence. That operator may

develop its own evidence, or may adopt

any evidence previously submitted by

an operator. In either case, the finally

designated responsible operator is

subject to the evidentiary limitations set

forth in § 725.414.

(c) The Department has replaced the

reference to § 725.413(c)(2) with a

reference to § 725.410(b) in order to

reflect the new provision governing the

time period for submitting documentary

evidence to the district director. The

Department has also deleted the word

‘‘operator’s’’ from the title of the

regulation. As revised, the Department’s

regulations do not provide a separate

period for the development of an

operator’s evidence.

(d) One comment submitted in

connection with the first notice of

proposed rulemaking states that this

section affords the district director too

much authority, but does not identify

which specific powers are objectionable.

Without more detail, the Department

cannot respond meaningfully to the

commenter’s concerns. Subsection (b)

does enumerate the possible actions a

district director may take after

reviewing all of the evidence developed

in conjunction with the claim. The

district director may notify additional

potentially liable operators, issue

another schedule for the submission of

additional evidence, schedule a

conference, issue a decision, or take any

other action appropriate to the

circumstances of the claim. The district

director must enjoy some degree of

flexibility in determining how to

proceed once evidentiary development

has concluded. For example, the district

director may determine, in light of

evidence submitted by the designated

responsible operator, that one or more

additional potentially liable operators

must be notified of the claim, or that a

previously notified potentially liable

operator should be designated the

responsible operator. In such cases, the

district director must have sufficient

authority to permit the parties to submit

additional evidence on the liability

issue. Accordingly, the Department does

not view the authority provided the

district director as excessive.

(e) One comment states that

eliminating the requirement in

§ 725.414, as initially proposed, that all

documentary medical evidence be

submitted to the district director has

also eliminated the need to strengthen

the integrity of the district director’s

adjudication. The Department disagrees.

In light of the Department’s final

revisions, the proposed decision and

order will be the only decisional

document that the district director

issues addressing the claimant’s

eligibility for benefits and the liability of

a responsible operator for the payment

of those benefits. A substantial number

of claimants currently accept the district

director’s conclusions regarding their

eligibility, and do not seek further

review of their claims for benefits. The

alternative to issuing proposed

decisions and orders—referring all cases

to the Office of Administrative Law

Judges (OALJs) for a formal hearing on

the merits—would represent a

considerable and unnecessary

expenditure of the resources of the

OALJs, the Office of Workers’

Compensation Programs, and the coal

mine operators who must litigate such

cases. Accordingly, the Department does

not agree that § 725.415 should be

revised to retain the current rule under

which district directors may simply

forward cases to the OALJs. Also,

issuance of some document is necessary

to establish the date from which the

parties’ modification rights begin to run.

The Department believes that it will be

easier for all parties if there is only one

such document in each case.

(f) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.416

(a) In its first notice of proposed

rulemaking, the Department proposed

revising subsection (c) to provide for the

imposition of sanctions on any party

that failed to appear at a scheduled

informal conference and whose absence

was not excused. The Department also

proposed revising subsection (d) to put

parties on notice that those attending

the conference would be deemed to

have the authority to stipulate to facts

or issues or resolve the claim. 62 FR

3361 (Jan. 22, 1997). In its second notice

of proposed rulemaking, the Department

responded to a number of comments

from a variety of sources urging the

elimination of informal conferences.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79995

Although the Department declined to

eliminate conferences, it proposed

revising subsection (b) to require the

district director to articulate specific

reasons for holding one. In the absence

of such a statement, the district director

would be prohibited from imposing

sanctions for a party’s failure to appear.

In addition, in order to reduce parties’

costs, the Department proposed to

recognize the current practice of

allowing parties to participate in

informal conferences by telephone. 64

FR 54996 (Oct. 8, 1999).

(b) A number of comments generally

oppose the use of informal conferences,

contending they create additional delay

and complexity in district director

claims processing. As explained in both

its first and second notices of proposed

rulemaking, the Department believes

that informal conferences may serve

useful purposes, including, in

appropriate cases, narrowing issues,

achieving stipulations, and crystallizing

positions. 62 FR 3361 (Jan. 22, 1997); 64

FR 54996 (Oct. 8, 1999). The

Department agrees, however, that

conferences should not unduly delay

the further adjudication of a claim. In

addition, they should be held only in

appropriate circumstances. Accordingly,

the Department has made two major

changes to § 725.416. In subsection (a),

the Department has added the

requirement that a district director

conduct any conference within 90 days

of the date on which the period for

submitting evidence under § 725.410(b)

closes, unless one of the parties requests

a postponement for good cause. The

Department has also deleted the

reference in subsection (b) to the district

director’s discretion to reschedule

conferences. Subsection (a) permits the

district director to reschedule

conferences, but only upon the motion

of a party. The Department has also

replaced the reference to § 725.413(c)(2)

in subsection (a) with a reference to

§ 725.410(b) in order to reflect a change

in those regulations. In addition, in

order to further limit the delay caused

by informal conferences, the

Department will continue to require that

the district director issue a decision

within 20 days of the close of all

conference proceedings, including the

time permitted for the submission of

any additional evidence. See § 725.417.

The Department has made a second

major change to § 725.416 to remove any

appearance of impropriety in the

informal conference process. The

district director is a subordinate of the

Director, Office of Workers’

Compensation Programs, a party in each

claim for black lung benefits. The

district director is also responsible for

the development of evidence on behalf

of the Black Lung Disability Trust Fund.

These dual roles may affect the degree

to which the district director is viewed

as a neutral arbiter of the issues before

him. An appearance of a conflict of

interest is particularly troubling in a

case in which there is no operator liable

for the payment of benefits, and the

claimant lacks representation. In order

to minimize any appearance of

unfairness, the Department believes that

conferences should be held only when

all parties are capable of making

informed judgments to protect their own

interests. Accordingly, in addition to

explaining why holding a conference in

a particular claim would be beneficial,

the Department will inform the parties

that no conference will be held if all

parties do not have representation. In

the event that a claimant is not

represented, the district director will

not hold a conference. An appointed lay

representative is sufficient, however, to

allow an informal conference to go

forward, 20 CFR 725.362, 725.363

(1999). The regulation extends the same

protection to operators that are neither

insured nor self-insured. Many selfinsured coal mine operators and

insurers do not obtain formal

representation at this stage of

adjudication, but have claims

processing personnel, either in their

offices or in the claims servicing

organizations that they use, who are

knowledgeable concerning the

entitlement and liability criteria of the

Black Lung Benefits Act and its

implementing regulations. The

Department believes that such

personnel should be able to enter into

binding stipulations on behalf of the

self-insured or insured coal mine

operator. The Department has replaced

the reference to § 725.362 in subsection

(d) with a reference to subsection (b) to

accomplish this result. Accordingly, the

regulation deems that such operators are

represented for purposes of scheduling

an informal conference. By contrast, the

Department intends that operators that

are neither insured nor self-insured—

operators that are not often called upon

to participate in the adjudication of

black lung benefits claims—should not

be asked to enter into stipulations

without the benefit of a formal

representative’s advice. Because there

will no longer be any conferences

involving unrepresented claimants, the

Department has deleted the last two

sentences of subsection (e). The district

director may continue to exercise his

discretion, however, to determine

whether parties understand any

stipulations which they are asked to

enter. Exercise of this discretion is

particularly important where a claimant

is represented by a lay representative.

(c) One comment submitted in

connection with the first notice of

proposed rulemaking and renewed in

connection with the second notice of

proposed rulemaking objects to the

regulation contending it improperly

provides for an adjudication of the

claim before the district director that is

neither on the record nor under oath.

The commenter also objects generally to

the discretion given the district director

to determine the procedures to be used

at the conference. The Department

recognizes that the informal conference

will not be conducted under oath and

on the record, but believes that the

changes it has made to the informal

conference procedures obviate this

objection. As revised, an informal

conference will only be held if all

parties to a claim are represented or are

deemed to be represented. This revision

removes the danger that the district

director will be able to obtain a

stipulation from an unsophisticated

party. Moreover, following the

termination of the informal conference

proceedings, the district director will

issue a proposed decision and order.

The district director’s ‘‘adjudication’’ of

the claim is thus subject to the consent

of the parties. A request for a hearing

will require the district director to

forward the claim to the Office of

Administrative Law Judges for de novo

adjudication. Consequently, the district

director’s inability to conduct the

informal conference under oath, and to

have the conference transcribed, will

not affect the substantive rights of any

party.

(d) No other comments have been

received concerning this section.

20 CFR 725.417

(a) In its first notice of proposed

rulemaking, the Department proposed

revising subsection (b) to incorporate

the limitations on documentary

evidence contained in § 725.414. 62 FR

3361 (Jan. 22, 1997). The Department

did not discuss § 725.417 in its second

notice of proposed rulemaking. See list

of Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) The Department has revised

subsection (b) to clarify the district

director’s authority to seek additional

information on the issue of responsible

operator liability even after he has held

a conference. The conference may

provide the district director with

additional information regarding the

claimant’s employment history.

Accordingly, subsection (b) authorizes

the district director to issue another

79996 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

notification of potential operator

liability under § 725.407 and/or another

schedule for the submission of

additional evidence under § 725.410.

(c) One comment objected to the

requirement in proposed subsection (d)

that parties respond in writing to the

district director’s memorandum of

conference. The Department agrees that

this response is unnecessary, and has

further streamlined its informal

adjudication of claims by eliminating in

its entirety the memorandum of

conference and the required response

that would have followed. Instead, at

the conclusion of informal conference

proceedings, including the submission

of any additional evidence, the district

director will issue a proposed decision

and order under § 725.418. The

Department has also revised subsection

(b) in order to clarify the meaning of the

sentence.

(d) One comment urges the

Department to create a time limit within

which the district director must issue a

decision after holding a conference.

Subsection (c), 20 CFR 725.417(c)

(1999), requires the district director to

issue a decision within 20 days of the

conclusion of the informal conference

proceedings. Consequently, no change

in the regulation is required.

(e) One comment submitted in

connection with the first notice of

proposed rulemaking recommended

amending subsection (b) to allow

submission of post-conference

supplementary reports from any

physician who has already prepared a

report if clarification of the physician’s

report is needed. No change in the

proposed regulation is necessary. A

party may request the opportunity to

submit additional evidence postconference which may further support

its position or a physician’s views. The

only restriction imposed by subsection

(b) is that such additional evidentiary

development cannot circumvent the

numerical limitations in § 725.414. To

the extent that the comment implies a

‘‘clarifying’’ report should be considered

an extension of the initial report, the

Department disagrees. Excluding

supplementary reports from the

§ 725.414 limitations would create an

exception which eviscerates the

limitation. A party could invite

comment from the physician on almost

any aspect of the medical evidence in

the record under the guise of

‘‘clarifying’’ the physician’s views in

light of that evidence. In effect, the

supplementary report would constitute

another medical report. Moreover, any

internal ambiguity or omission in the

physician’s opinion should be apparent

upon receipt and review of the report,

and can therefore be corrected before

submitting the report into the record. If,

however, some aspect of a physician’s

report has been the subject of rebuttal

evidence by an opposing party,

§ 725.414 does allow the rehabilitation

of the original report by the submission

of a clarifying report from the original

doctor. Such rehabilitative evidence is

allowed by the evidentiary limitations

in § 725.414.

(f) One comment argues that the

regulation is questionable in light of the

changes made to § 725.414. In the

absence of any further explanation by

the commenter, the Department is

unable to respond.

(g) The Department received no other

comments concerning this section.

20 CFR 725.418

(a) The Department proposed revising

subsection (a) in its first notice of

proposed rulemaking to identify the

proposed decision and order as the step

which follows a district director’s

memorandum of conference or, if no

conference was held, the period

established by the district director for

the submission of evidence. The

revision was intended to require the

issuance of a proposed decision and

order in each case, and to eliminate the

district director’s option of referring the

case for a hearing without issuing a

proposed decision and order. 62 FR

3361 (Jan. 22, 1997). The Department

did not discuss § 725.418 in its second

notice of proposed rulemaking. See list

of Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) The Department has added

subsection (d) to provide explicitly that,

to the extent he has not done so before,

the district director must dismiss, as

parties to the claim, all potentially liable

operators except one. Moreover, the

regulation guarantees that no operator

may be the finally designated

responsible operator unless it: (1) Was

notified of its potential liability

pursuant to § 725.407, and thus given

the opportunity to submit evidence

under § 725.408; and (2) given the

opportunity to submit additional

evidence relevant to the liability of

other potentially liable operators and

the claimant’s eligibility pursuant to

§ 725.410.

(c) The Department has deleted the

reference in the first sentence of

subsection (a) to the parties’ responses

to the district director’s

recommendations because a district

director will no longer issue a

memorandum of conference following

the termination of conference

proceedings. See preamble to § 725.416.

In its place, the Department has added

a reference to the 20-day time period

provided by § 725.417(c) within which

the district director must issue a

proposed decision and order. In

addition, the Department has replaced

the reference to § 725.413(c)(2) with a

reference to 725.410(b) in order to

reflect changes to those regulations. The

Department has deleted the words ‘‘to

be’’ in the first sentence of subsection

(a) as unnecessary, and has revised the

last sentence of subsection (a) to clarify

the meaning of the regulation. The

Department has also revised subsection

(b) to clarify that the proposed decision

and order is the document that must be

served on the parties by certified mail.

(d) A number of comments objected to

the Department’s proposed revision of

§ 725.411, which would have treated a

hearing request filed before the

conclusion of district director

processing as a request for the further

adjudication of the claim. See 62 FR

3356 (Jan. 22, 1997). The Department

believes that its amended procedures in

§§ 725.410 through 725.412, 725.416—

725.417, will eliminate much of the

confusion that has led parties to file

hearing requests before the conclusion

of administrative processing. Whereas

the Department’s original proposal

authorized the district director to issue

an initial finding, a memorandum of

conference, and a proposed decision

and order, the revised regulations

provide for the issuance of only one

decisional document in most cases: A

proposed decision and order. The

Department does agree, however, that it

should honor any hearing request that is

filed by a party even if it is filed before

the conclusion of a district director’s

processing. Accordingly, the

Department has added subsection (c) to

require that the proposed decision and

order apprise parties of their right to a

hearing. Where a party has previously

filed a hearing request, and can

reasonably be said to be aggrieved by

the proposed decision and order, the

district director will inform the party

that the case will be referred to the

Office of Administrative Law Judges

unless the party revokes its previous

request. In the case of a claimant who

has previously requested a hearing, the

district director will forward the case if

he has denied benefits. In the case of an

operator who has previously requested

a hearing on either the claimant’s

eligibility or its liability for benefits, the

district director will forward the case if

he has awarded benefits.

(e) One comment submitted in

connection with the first notice of

proposed rulemaking and renewed in

response to the second notice of

proposed rulemaking expresses general

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79997

dissatisfaction with the issuance of a

proposed decision and order calling it

an unnecessary procedural step. The

issuance of this document, however, is

the logical culmination of the claims

adjudication process at the district

director level. Under the revised

procedures adopted by the Department,

it will serve as the district director’s

only attempted resolution of the issues

of claimant eligibility and operator

liability. The proposed decision and

order thus serves either as a final

disposition of the claim if the parties

accept the decision, or as the conclusion

of the initial stage of adjudication if a

party aggrieved by the result intends to

pursue the case to the hearing stage. The

Department therefore rejects the

suggestion that a proposed decision and

order is unnecessary.

(f) No other comments were received

concerning this section.

20 CFR 725.419

The Department received two

comments relevant to § 725.419. This

section was not open for comment; only

technical changes were made to it. See

62 FR 3340–41 (Jan. 22, 1997); 64 FR

54970 (Oct. 8, 1999). Therefore no

changes are being made in it.

20 CFR 725.421

(a) In its first notice of proposed

rulemaking, the Department proposed

deleting language in subsection (a) to

allow district directors to maintain the

files of cases which have been referred

to the Office of Administrative Law

Judges. Formerly, those files had been

sent to the national office of OWCP’s

Division of Coal Mine Workers’

Compensation. 62 FR 3361 (Jan. 22,

1997). The Department did not discuss

§ 725.421 in its second notice of

proposed rulemaking. See list of

Proposed Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999).

(b) The Department has revised

subsection (b)(3) to ensure that the

record is sufficient to establish that the

district director provided the finally

designated responsible operator with

notification of its status as a potentially

liable operator under § 725.407 as well

as its designation as the responsible

operator pursuant to § 725.410. In

addition, the Department has revised

subsection (b)(4) to ensure that the

record forwarded to the Office of

Administrative Law Judges contains

only medical evidence submitted by the

claimant and the finally designated

responsible operator or fund, as

appropriate. See explanation

accompanying §§ 725.414, 725.415. All

evidence relevant to the issue of

operator liability shall be made a part of

the record.

(c) In subsection (a), the Department

has added the word ‘‘evidentiary’’ and

deleted the phrase ‘‘in the claim’’ to

clarify the meaning of the sentence.

(d) One comment submitted in

connection with the Department’s first

notice of proposed rulemaking objects to

subsection (c) because it requires a party

to pay for copies of documents which

have previously been provided. The

commenter argues that claimants in

particular are unaware of the

importance of keeping all documents

associated with their claims. No change

is made in response to this comment.

Subsection (c) is a rule of general

applicability, and affects responsible

operators and insurance carriers as well

as claimants. The provision states that

the district director shall determine the

amount of the copying fee. It therefore

allows the district director to consider

mitigating factors (the individual’s

financial condition, the cost of the

documents being replaced, etc.) as

grounds for reducing or waiving the

copying fee. No other comments

concerning this section were received,

and no changes have been made in it.

20 CFR 725.422

The Department received several

comments relevant to § 725.422. This

section was not open for comment; it

was repromulgated without alteration

for the convenience of the reader; see 62

FR 3341 (Jan. 22, 1997); 64 FR 54971

(Oct. 8, 1999). Therefore, no changes are

being made in it.

20 CFR 725.423

(a) In its first notice of proposed

rulemaking, the Department proposed

the addition of § 725.423 to consolidate

all of the provisions governing

extensions of time in subpart E of part

725. With the exception of two time

periods, one in § 725.411(a)(1)(i)

governing a claimant’s response to an

unfavorable initial finding and the other

in § 725.419 governing responses to a

district director’s proposed decision and

order, the proposed regulation would

have allowed any time period to be

extended for good cause shown

provided a request for an extension was

filed before the time period expired. 62

FR 3361 (Jan. 22, 1997). The Department

did not discuss § 725.423 in its second

notice of proposed rulemaking. See list

of Proposed Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) The Department has eliminated

the reference in § 725.423 to the time

period set forth in § 725.411(a)(1)

because that time period has been

eliminated from the regulations. See

preamble to §§ 725.410–.413.

(c) One comment submitted in

connection with the first notice of

proposed rulemaking objects to a single

regulation governing extensions of time.

The commenter would prefer individual

provisions in each affected regulation to

add clarity to the proceedings. The

Department disagrees. In terms of an

efficient structure for the program

regulations, a single provision with

application to the entire Subpart E is

more logical than a series of repetitive

provisions added to each regulation

containing a time frame for action.

(d) One comment submitted in

connection with the first notice of

proposed rulemaking urges explicit

recognition that a request for an

extension of time may be honored even

if submitted after the time period for

taking action has expired. This

suggestion cannot be adopted. A ‘‘wellsettled’’ principle of the black lung

program requires the parties to ‘‘strictly

adhere to the substantive and

procedural requirements of the Black

Lung Benefits Act and its implementing

regulations.’’ Jordan v. Director, OWCP,

892 F.2d 482, 486 (6th Cir. 1989). Strict

adherence to clearly delineated time

frames for taking action promotes ‘‘a

just, efficient and final resolution’’ of

claims. 892 F.2d at 487. Any party,

however, may ask for additional time to

act. The Department believes a

requirement that the extension be

sought before the time for acting elapses

is reasonable. See generally Fetter v.

Peabody Coal Co., 6 Black Lung Rep. 1–

1173, 1–1175 (1984). Each party has

notice of when some action must be

taken during the adjudication process.

Even if the party cannot complete the

action itself, it may at least complete the

request for additional time. Submitting

a timely request for an extension is not

an onerous burden.

(e) One comment recommends

including proposed § 725.411(a)(1)(i)

among the time periods which can be

extended. As originally proposed,

section 725.411(a)(1)(i) would have

afforded a claimant who has been

denied benefits one year from the

district director’s initial finding within

which to request further adjudication.

The revisions made by the Department

to §§ 725.410–.413 have eliminated the

time period in § 725.411(a)(1)(i).

Accordingly, the comment is no longer

relevant.

(f) One comment urges the

Department to specify that a party

cannot seek an extension of its right to

file a request for modification under

§ 725.310 if that request is not filed

before the expiration of the one-year

79998 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

time period. By its terms, section

725.423 governs the extension of time

periods in subpart E of part 725. It thus

does not govern section 725.310, which

is located in subpart C. The Department

does not believe that a catchall

provision for the entire part 725 is

appropriate, and, in the absence of such

a provision, believes that § 725.423

should not include a reference to any

regulations outside of subpart E.

(g) One comment argues that the

Department should not create a nonstatutory jurisdictional bar by refusing

to permit an extension of time in the

case of a proposed decision and order.

The commenter argues that the

Department’s regulation violates the

rights of parties under the

Administrative Procedure Act and the

Black Lung Benefits Act to obtain a

hearing. The Department disagrees. The

time limit established by § 715.419 for

responding to a proposed decision and

order is necessary to create finality in

those cases where no party contests the

district director’s initial adjudication of

a claim. In the event that the

Department issues a proposed decision

and order awarding benefits and the

designated responsible operator fails to

respond in a timely manner, the

Department must be able to enforce the

award against the operator. Enforcement

of an award under § 21(d) of the

Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 921(d), as

incorporated by 30 U.S.C. 932(a), and

the collection of benefits owed the Black

Lung Disability Trust Fund under 30

U.S.C. 934, however, require that the

decision and order awarding benefits be

final. The time limit in the current

version of § 725.419, 20 CFR 725.419

(1999), has been interpreted to be

jurisdictional, Freeman United Coal

Mining Co v. Benefits Review Board, 942

F.2d 415, 422 (7th Cir. 1991), and

§ 725.423 simply recognizes that

interpretation. Contrary to the

commenter’s suggestion, assigning

finality to a district director’s proposed

decision and order awarding benefits in

the absence of a timely objection by the

designated responsible operator violates

no provision in the Administrative

Procedure Act or the Black Lung

Benefits Act. Nothing in either statute

requires the Department to give effect to

a party’s late request for a hearing

following the conclusion of the district

director’s administrative proceedings.

(h) No other comments were received

concerning this section.

Subpart F

20 CFR 725.452

(a) The Department proposed adding

subsection (d) in its first notice of

proposed rulemaking to prohibit the

deciding of a case without holding a

hearing unless the administrative law

judge believes an oral hearing is not

necessary, notifies the parties that he

intends to decide the case on the record,

and the parties do not object. 62 FR

3361 (Jan. 22, 1997). The Department

did not discuss this regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999).

(b) One comment objects to the

Department’s insistence on an in-person

hearing. The commenter states that an

administrative law judge should be

entitled to decide whether a hearing is

necessary in the event that the parties

disagree. The regulation reflects the

Department’s consistent position that

any party is entitled to a hearing before

an administrative law judge in a case

that is not appropriate for summary

judgment. Section 19(c) of the

Longshore and Harbor Workers’

Compensation Act requires a hearing

‘‘upon application of any interested

party.’’ 33 U.S.C. 919(c), as incorporated

by 30 U.S.C. 932(a). In its recent

decision in Robbins v. Cyprus

Cumberland Coal Co., 146 F.3d 425, 430

(6th Cir. 1998), the Sixth Circuit

recognized the existence of such a right

in a modification proceeding. See also

Cunningham v. Island Creek Coal Co.,

144 F.3d 388, 389–90 (6th Cir. 1998);

Pyro Mining Co. v. Slaton, 879 F.2d 187,

190 (6th Cir. 1989). The Robbins court

explained several reasons for requiring

an in-person hearing:

The mere fact that parties rarely bring a

live expert is immaterial. [The claimant]

should have had the opportunity to bring a

live expert. Additionally, although the ALJ

required any documentary evidence to be

introduced in advance, the Director correctly

points out that [the claimant] could request

and receive permission at a hearing to

introduce additional documentary evidence.

146 F.3d at 429. The in-person hearing

also allows the parties to offer lay

testimony on such issues as the miner’s

employment and medical history.

Finally, the Department believes that

guaranteeing the ability of all parties to

appear before a highly qualified

administrative law judge increases the

parties’ confidence in the fairness and

impartiality of the adjudication process.

Contrary to the commenter’s suggestion,

the Department does not insist that an

in-person hearing must be held in every

case. The parties remain free to move for

summary judgment under subsection (c)

in those rare cases where there is no

genuine dispute as to a material issue of

fact. In all other cases, however, the

Department’s revised regulation gives

each party to a claim the right to insist

on an in-person hearing. Permitting the

cancellation of a hearing over the

objection of even one of the parties, in

a case involving disputed facts, would

contravene the explicit command of 33

U.S.C. 919, as incorporated by 30 U.S.C.

932(a). No other comments were

received concerning this section, and no

changes have been made in it.

20 CFR 725.453

Although the Department received

comments under this section, the

regulation was not open for comment,

see 62 Fed. Reg. 3341 (Jan. 22, 1997); 64

Fed. Reg. 54970–71 (Oct. 8, 1999). The

regulation was repromulgated only for

the convenience of readers.

Accordingly, no changes are being made

in this section.

20 CFR 725.454

(a) In its first notice of proposed

rulemaking, the Department proposed

eliminating the provision allowing

administrative law judges to reopen the

record for the receipt of additional

evidence for ‘‘good cause.’’ 62 FR 3361

(Jan. 22, 1997). The Department’s

proposal reflected the evidentiary

limitations then imposed by § 725.414.

The Department did not discuss the

regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) Several comments submitted in

response to both the Department’s 1997

proposal and its 1999 reproposal oppose

removal from the current regulation of

the administrative law judge’s authority

to reopen the record to receive

additional evidence for good cause

shown. The Department responded to

those objections when it reproposed

§ 725.414(c), (d) and § 724.456(b) for

additional comment. 64 FR 54994–95

(Oct. 8, 1999). At that time, the

Department changed the proposed

standard for the admission of

documentary medical evidence in

excess of the regulations’ numerical

limitations from one of ‘‘extraordinary

circumstances’’ to ‘‘good cause,’’ while

leaving the standard for admission of

additional evidence relating to operator

liability—evidence that was not

submitted to the district director—one

of extraordinary circumstances. In any

event, the standard to be used to govern

the introduction of documentary

evidence while a case is pending before

the Office of Administrative Law Judges

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 79999

more properly belongs in § 725.456, and

it remains there. In that regulation,

medical evidence in excess of the

limitations contained in § 725.414 may

be admitted into the record upon a

showing of good cause. No change has

been made in § 725.454 in response to

these comments.

(c) One comment recommends

clarifying subsection (a) to underscore

the claimant’s right to request a hearing

site somewhere outside the 75-mile

radius around his residence for the

convenience of his representative. No

change is made in response to this

comment. Subsection (a) specifically

provides that a claimant may request an

alternate location, and does not limit the

site to a specific area or distance from

the claimant’s residence. A claimant

may therefore request the administrative

law judge to move the hearing site

beyond the 75-mile boundary.

Claimants, however, cannot be accorded

an unqualified right to determine where

hearings should be convened. All

matters relating to the conduct of the

hearing are ultimately the responsibility

of the administrative law judge. He or

she must balance the interests and rights

of all the parties against the

convenience of a particular site for the

claimant. Consideration must also be

given to administrative convenience and

the efficient allocation of human and

financial resources in general. An

administrative law judge generally

schedules several claims for

adjudication in one location.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.456

(a) The Department proposed revising

section 725.456 in its first notice of

proposed rulemaking in order to reflect

its original proposal in § 725.414

requiring parties to submit all of their

documentary evidence to the district

director. As originally proposed, section

725.456 would have prohibited the

introduction of any additional evidence

before the administrative law judge in

the absence of extraordinary

circumstances. 62 FR 3361–62 (Jan. 22,

1997). In its second notice of proposed

rulemaking, the Department eliminated

the requirement in § 725.414 that parties

submit all of their documentary medical

evidence to the district director in the

absence of extraordinary circumstances,

although it retained that requirement

with respect to documentary evidence

relevant to the issue of operator liability.

Instead, the Department proposed

allowing admission of documentary

medical evidence in excess of the

§ 725.414 numerical limitations upon a

showing of good cause. Accordingly, in

its second proposal, the Department

revised section 725.456, adding

subsections from 20 CFR 725.456 (1999)

to govern the submission of

documentary medical evidence to the

administrative law judge. 20 CFR

725.456(b)(1)–(3), (c), (d) (1999). The

Department also revised subsection (f),

now subsection (e), to reflect changes to

§ 725.406. 64 FR 54996 (Oct. 8, 1999).

(b) A number of comments object to

the Department’s addition of proposed

subsection (c) to § 725.456, which

prohibits parties from introducing

documentary evidence at the formal

hearing that was in their possession

while the case was pending before the

district director and was withheld from

the district director or any other party.

Several of the comments argue under a

parallel provision, proposed

§ 725.414(e), that the provision will

most severely affect claimants who are

not represented by counsel while the

case is pending before the district

director, and who may unwittingly fail

to provide the district director with

evidence that they have developed.

Another comment urges the Department

to harmonize subsection (c) with section

725.414(e).

Subsection (c) was originally

promulgated by the Department in 1978,

and was designed to ensure that the

district director’s initial determination

of the claimant’s eligibility was based

on all of the available evidence

regarding the miner’s medical

condition. The subsection was also

designed to ensure that the parties had

adequate time to respond to an

opponent’s evidence. See 43 FR 36794,

36798 (Aug. 18, 1978). The revised

regulations, however, will significantly

alter the adjudication of black lung

benefits cases. In particular, the district

director will make his initial

determination in reliance on a complete

pulmonary evaluation performed by a

highly qualified physician, and will

already have all of the evidence relevant

to the identification of the responsible

coal mine operator. Moreover, as the

commenters point out, an unrepresented

claimant who obtains an opinion from

his treating physician may inadvertently

fail to submit it to the district director,

and, under proposed subsection (c),

would be prevented from submitting it

thereafter to the administrative law

judge. In addition, the 20-day

requirement in subsection (b)(2) will

ensure that parties have an adequate

period in which to respond to the

opposing party’s evidence. Thus, the

Department does not believe that

subsection (c) remains necessary.

Neither of the stated bases for the

original adoption of the rule remain.

Accordingly, proposed subsection (c) is

deleted, and proposed subsections (d),

(e), and (f) are redesignated as

subsections (c), (d), and (e),

respectively. The Department has made

a corresponding deletion of proposed

section 725.414(e). Since both

subsections are now deleted, there is no

need to harmonize them.

(c) One comment argues that the

Department’s revision imposes

increased costs on coal mine operators

by ‘‘front-loading’’ the evidentiary

development process in claims where

such development is unnecessary or

could be delayed. This comment

appears to be based on the mistaken

belief that the Department’s regulations

continue to require the parties to submit

all of their documentary medical

evidence to the district director. The

Department revised its proposal in 1999,

and § 725.456, as reproposed, will allow

both the claimant and the designated

responsible operator in a claim to delay

their development of documentary

medical evidence until shortly before

the formal hearing. In the event that a

claim does not proceed beyond the

district director level, the operator will

not have to develop any medical

evidence. This is the operators’ current

practice in many claims.

The Department acknowledges,

however, that operators will still be

required to submit evidence regarding

their potential liability for the claim to

the district director while the claim is

being adjudicated at this earliest stage.

Under the former regulations, an

operator did not have to submit any

evidence to support its denial of

liability until the case was referred to

the Office of Administrative Law Judges

for a formal hearing. In a number of

cases, where no party requested a

hearing, the operator did not need to

develop or submit this evidence at all.

Thus, the commenter’s observation that

the revised regulations will require the

‘‘up-front’’ development of evidence is

well-taken with respect to operator

liability evidence. In both its initial

notice of proposed rulemaking and its

second notice of proposed rulemaking,

however, the Department explained its

intention to require potentially liable

operators to submit evidence relevant to

their employment of the miner and their

financial capability to pay benefits at

the earliest possible stage. 62 FR 3355–

56 (Jan. 22, 1997); 64 FR 54990–91 (Oct.

8, 1999). In these final regulations, the

Department has also required operator

development and submission of any

evidence relevant to the liability of

another party during the district

director’s claims processing. Evidentiary

80000 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

development as to other parties will be

necessary, however, only in that small

percentage of claims in which the

identity of the responsible operator is in

serious question. See § 725.414(b). The

Department continues to believe that

these requirements are justified by the

Department’s need to ascertain the

positions of potentially liable operators

on these issues while the case is

pending before the district director,

especially given the fact that potentially

liable operators other than the

designated responsible operator will no

longer be parties once a case has been

referred to the Office of Administrative

Law Judges. In addition, the Department

continues to believe that the increased

costs that operators will have to bear as

a result of this ‘‘front-loading’’ will not

be significant.

(d) One comment submitted in

response to the 1997 proposal and the

1999 reproposal states that the

Department’s revision eliminates the

authority of administrative law judges to

perform certain functions. Another

comment argues that the revision

marginalizes administrative law judges

and demeans their powers and duties.

Although neither comment offers

specific examples of functions, powers,

and duties that the Department has

eliminated by revising section 725.456,

the Department has independently

reviewed the provision and does not

believe that it eliminates any function

currently performed by the

administrative law judge, nor any power

or duty that administrative law judges

currently possess. Under the revised

regulations, administrative law judges

will retain full authority to decide any

issue in respect of a claim, as required

by section 19(a) of the Longshore and

Harbor Workers’ Compensation Act, 33

U.S.C. 919(a), as incorporated by 30

U.S.C. 932(a). Neither the Longshore Act

nor the Administrative Procedure Act

gives administrative law judges the right

to demand that more evidence be made

available for their decision-making. To

the extent that they are unpersuaded by

the evidence of record, the

administrative law judge must decide

that issue against the party that bears

the burden of producing the evidence

on that issue.

(e) One comment argues that the

revised regulation denies the rights of

all parties to fully cross-examine

adverse evidence and witnesses. The

Department does not agree that section

725.456 affects the rights of any party to

cross-examine adverse evidence. In

Richardson v. Perales, 402 U.S. 388, 409

(1971), the Supreme Court emphasized

the importance of preserving the parties’

ability to cross-examine the authors of

written medical reports, the evidentiary

basis of Social Security’s disability

determinations. Similarly, the

Department’s regulations provide all

parties with a full and fair opportunity

to conduct cross-examination. If the

author of a report testifies at the hearing,

the opposing party may clearly avail

itself of the opportunity to conduct live

cross-examination. In cases where the

documentary medical evidence stands

on its own, the opposing party may

question the author of the report under

conditions determined by the

administrative law judge. See § 725.459.

Finally, the administrative law judge

has the authority, in appropriate cases,

to issue a subpoena to compel the

attendance of a witness at the hearing.

In addition, in any case involving

documentary medical evidence, the

opposing party has the right, under

section 725.414, to submit documentary

rebuttal evidence of its own.

Accordingly, the Department does not

agree that its revisions to 725.456 in any

way limit the right of parties to conduct

an effective cross-examination.

(f) One comment argues that a party

should not be required to make an

independent showing of ‘‘good cause’’

in order to put on its case. The

Department does not agree that

§ 725.456 prohibits a party from putting

on its affirmative case. In combination

with § 725.414, this provision places

reasonable limitations on the number of

medical reports and tests that a party

may submit into evidence. A showing of

‘‘good cause’’ is necessary only in the

event that a party seeks to convince the

administrative law judge that the

particular facts of a case justify the

submission of additional medical

evidence, either in the form of a

documentary report or testimony. The

Department believes that in the majority

of cases, the quantity of medical

evidence permitted by the regulations,

even in the absence of a good cause

showing, will provide a more than

adequate evidentiary basis for an

administrative law judge to determine

the claimant’s eligibility for benefits.

(g) Three comments approve of the

Department’s reinstatement of the 20-

day rule governing the introduction of

documentary evidence before the

administrative law judge.

(h) One comment argues that

§ 725.457(d) is invalid in that it

prohibits a physician from testifying as

to medical evidence relevant to the

miner’s condition that is not contained

in the record. This comment is more

appropriately addressed under section

725.457.

(i) No other comments were received

concerning this section and no other

changes have been made in it.

20 CFR 725.457

(a) In its initial notice of proposed

rulemaking, the Department proposed

revising subsection (c) to conform the

regulation to the requirement then in

§ 725.414 that a party identify all of its

potential witnesses while the claim was

pending before the district director. The

Department also proposed adding a

subsection (d) to address the

permissible scope of a medical witness’s

testimony. 62 FR 3362 (Jan. 22, 1997).

In light of changes to § 725.414 in the

second notice of proposed rulemaking,

the Department proposed altering the

witness identification requirement so

that it applied only to witnesses who

were testifying to the liability of a

potentially liable operator or the

designation of the responsible operator.

Thus, under the reproposal, the

testimony of witnesses relevant to the

liability of a potentially liable operator

and/or the identification of the

responsible operator was permissible

only if the identity of that witness was

disclosed to the district director.

In the second proposal, the

Department eliminated the requirement

that parties identify their medical

witnesses while the case was pending

before the district director because, as

revised, the regulations allowed parties

to forego development of medical

evidence until a case was referred to the

Office of Administrative Law Judges. In

the reproposal, the testimony of medical

witnesses was limited by only two

considerations. First, the total number

of medical reports and medical

witnesses offered by a party could not

exceed the limitations set forth in

§ 725.414 except upon a showing of

good cause. Second, a party had to

provide the other parties to a claim with

appropriate notice of a witness’

testimony: 10 days notice of any expert

witness who would testify at the

hearing, or 30 days notice of a

deposition. The Department also revised

subsection (d) to permit physicians to

testify with respect to any medical

evidence relevant to the miner’s

physical condition that was admitted

into evidence. 64 FR 54996 (Oct. 8,

1999). The Department has added a

clause to subsection (a) to clarify its

intent that parties provide 10 days

notice of any medical witness that they

intend to present at the hearing,

including witnesses who have prepared

a medical report that has already been

submitted into evidence.

(b) One comment argues that it is

unreasonable to require a party to

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80001

identify a testifying witness while the

claim is pending before the district

director and that the requirement

illegally diminishes the authority of the

administrative law judge who conducts

the hearing. The Department disagrees.

This limitation is a reasonable extension

of the requirement, set forth in Subpart

E, that parties develop all of the

evidence relevant to the liability of

potentially liable operators while the

case is pending before the district

director. In both notices of proposed

rulemaking, the Department explained

that requiring the submission of

evidence relevant to liability was

intended to offset the risk that the Black

Lung Disability Trust Fund would be

required to assume liability in the event

that none of the potentially liable

operators named by the district director

was ultimately determined to be the

responsible operator. See 62 Fed. Reg.

3355–56 (Jan. 22, 1997); 64 Fed. Reg.

54993 (Oct. 8, 1999). A party should not

be able to avoid the required evidentiary

development before the district director

by submitting its evidence to the

administrative law judge in the form of

witness testimony. Accordingly, the

regulations require that parties identify

all such witnesses while the case is

pending before the district director. The

regulations also recognize, however,

that a party may submit additional

documentary evidence on the liability

issue at the hearing upon a showing of

extraordinary circumstances,

§ 725.456(b)(1), and the regulations

should provide the same standard for

allowing witnesses’ testimony. For

example, the Department intends that a

party will have shown extraordinary

circumstances to present the testimony

of a previously unidentified witness

whose testimony is relevant to the issue

of operator liability when the witness

originally identified by the party is no

longer available to testify. Accordingly,

the Department has revised subsection

(c)(1) to reflect this exception. The

Department has also revised subsection

(c)(1) to reflect its decision to permit the

district director to refer the case to the

Office of Administrative Law Judges

with only one potentially liable

operator, the designated responsible

operator, as a party to the claim. The

Department has also added a clause to

subsection (c)(2) to clarify its intent that

the combination of physician testimony

and documentary medical reports may

exceed the numerical limitations of

§ 725.414 only upon a showing of good

cause. The Department has also deleted

the last clause of this subsection; the

introductory sentence of subsection (c)

is sufficient to make clear the

Department’s intent that the limitations

in the subsection are intended to govern

testimony at a hearing as well as by

deposition or interrogatories.

The Department does not agree,

however, that revised § 725.457

diminishes the authority of

administrative law judges. Under the

procedures incorporated into the Black

Lung Benefits Act from the Longshore

and Harbor Workers’ Compensation Act

and the Administrative Procedure Act,

administrative law judges are neutral

arbiters of the issues presented to them

for resolution. Based on the evidence

submitted by the parties within the

confines of the regulations promulgated

by the Secretary, ALJs have ‘‘full power

and authority to hear and determine all

questions in respect of such claim.’’ 33

U.S.C. 919(a), as incorporated by 30

U.S.C. 932(a). The requirement that

parties identify witnesses relevant to the

issues of operator liability while a case

is pending before the district director,

and the limitation on expert testimony,

are legitimate agency procedural rules

designed to ensure the timely

presentation of the evidence needed to

adjudicate black lung benefits claims.

(c) Two comments state that the

notice provision in subsection (a)

should be harmonized with section

725.414(c). The Department does not

believe that these provisions are in

conflict. Subsection 725.414(c) requires

the designated responsible operator to

identify witnesses whose testimony may

be introduced, either at the hearing or

by deposition, on the issues relevant to

operator liability while the claim is

pending before the district director in

the absence of extraordinary

circumstances. The Department

anticipates that the vast majority of

these witnesses will be ‘‘fact witnesses,’’

i.e., witnesses whose testimony will

establish certain facts pertaining to the

miner’s employment. For example, an

operator may present testimony to

establish that the claimant did not work

as a miner while working for the

operator, or that the claimant was not

exposed to coal mine dust. Because

these witnesses are not ‘‘expert

witnesses,’’ the 10-day notice

requirement of section 725.457(a) is

inapplicable. In cases where the witness

who will appear at the hearing is an

expert witness, such as a witness who

will testify to the coal industry’s use of

certain terms in a coal mine lease, the

party offering that witness’s testimony

must also provide 10 days notice to all

other parties to the claim. That time

allows the other parties sufficient time

to prepare to cross-examine the expert

witness at the hearing. If the witness

testifies by deposition, the 30-day notice

required by § 725.458 provides

sufficient time for preparation.

(d) One comment argues that the

Department’s limitation on the

testimony of physicians found in

§ 725.457(d) is more restrictive than that

in the Federal Rules of Evidence and

inconsistent with section 23 of the

Longshore and Harbor Workers

Compensation Act, 33 U.S.C. 923, as

incorporated by 30 U.S.C. 932(a). The

Department’s regulation prohibits a

physician who offers testimony from

relying on materials relevant to the

miner’s medical condition that are not

part of the record. The commenter

contrasts the regulation with the

Seventh Circuit’s recent decision in

Peabody Coal Co. v. Director, OWCP,

165 F.3d 1126 (7th Cir. 1999). In

Peabody Coal, the Seventh Circuit

reversed an award of benefits because

the administrative law judge had

discredited a medical opinion that was

based on an autopsy review not

admitted into the record. The court held

that under Rule 703 of the Federal Rules

of Evidence, an expert witness may base

his opinion on materials that ‘‘need not

be admissible, let alone admitted, in

evidence, provided that they are the sort

of thing on which a responsible expert

draws in formulating a professional

opinion.’’ 165 F.3d at 1128. The court

further noted that it could not think of

any reason why black lung

adjudications should be subject to

tighter restrictions on expert testimony,

and added that ‘‘[n]either Congress nor

the Department of Labor thinks so.

Nothing in the statute or regulations

applicable to such cases supports the

decision of the administrative law judge

to impose tighter limits on expert

witnesses in black lung cases than the

Federal Rules of Evidence impose in

ordinary civil and criminal trials.’’ 165

F.3d at 1129.

The regulations under which Peabody

Coal was adjudicated, however, did not

contain any limitations on the quantity

of medical evidence that a party was

entitled to submit to the administrative

law judge. Because the Department has

now limited the amount of documentary

medical evidence in the record, it

cannot allow parties to avoid that

limitation by presenting an expert

witness who will be free to examine

additional material that may not be

admitted into the record. For example,

if the party has already submitted a

medical report prepared by one

physician, and a consultative report

prepared by a second physician, it is not

entitled to submit the consultative

report of a third physician in the

absence of good cause. The regulation

ensures that the party is not allowed to

80002 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

avoid that limitation simply by having

the second physician testify, not only

about his own conclusions, but also

about the conclusions reached by a third

doctor. The Department believes that

the limitation contained in subsection

(d) is an appropriate means of ensuring

the parties’ adherence to the evidentiary

limitations imposed by section 725.414.

Like section 725.414, the revised

version of section 725.457 will apply

only to claims filed after the effective

date of these regulations.

Contrary to the commenter’s

objection, then, the Department’s

revision does not ‘‘violate’’ the Seventh

Circuit’s decision in Peabody Coal. The

court did not base its decision on an

interpretation of unambiguous statutory

language, but by using the Federal Rules

of Evidence in a case in which the

statute and regulations were silent. 165

F.3d at 1129. By promulgating a

regulation that will produce a result

contrary to the court’s decision in the

same circumstances, the Department has

simply exercised its authority to fill in

a gap identified by the court. ‘‘The

power of an administrative agency to

administer a congressionally created

* * * program necessarily requires the

formulation of policy and the making of

rules to fill any gap left, implicitly or

explicitly, by Congress.’’ Morton v. Ruiz,

415 U.S. 199, 231 (1974).

Nor does section 725.457 violate

section 23 of the Longshore Act. Section

23(a) provides that an administrative

law judge ‘‘shall not be bound by

common law or statutory rules of

evidence or by technical or formal rules

of procedure, except as provided by this

chapter.’’ 33 U.S.C. 923(a), as

incorporated by 30 U.S.C. 932(a). Even

if this provision could be read as

prohibiting the Department from

promulgating any regulations under the

Longshore Act that govern hearing

procedures and the submission of

evidence, the Black Lung Benefits Act

explicitly authorizes the Secretary of

Labor to promulgate regulations that

vary incorporated Longshore Act

provisions in order to properly

administer the black lung benefits

program. 30 U.S.C. 932(a); Director,

OWCP v. National Mines Corp., 554

F.2d 1267, 1274 (4th Cir. 1977). As

discussed above, the limitation on the

scope of testimony by physicians set

forth in § 725.457 is necessary in order

to ensure that parties adhere to the

limitations on the quantity of medical

evidence permitted each side in the

adjudication of a claim for black lung

benefits. Accordingly, the Department

does not agree that the limitation

violates section 23 of the Longshore Act.

(e) One comment approves of the

Department’s revision of the regulation

with respect to the testimony of medical

witnesses.

(f) No other comments were received

concerning this section.

20 CFR 725.458

(a) In its first notice of proposed

rulemaking, the Department proposed

revising this regulation to ensure that

the limitation on the scope of a

physician’s testimony set forth in

§ 725.457 was also applicable to

testimony offered by deposition and to

responses to interrogatories. 62 FR 3362

(Jan. 22, 1997). The Department did not

discuss this regulation in its second

notice of proposed rulemaking. See list

of Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

The Department did revise § 725.457(d),

however, in order to allow a physician

who testifies at a hearing to address all

of the medical evidence of record. By

incorporating § 725.457(d), § 725.458

also incorporated this expansion of the

permissible scope of a physician’s

testimony.

(b) The Department received several

comments concerning the crossreference to § 725.457(d). The reference

to § 725.457(d) incorporates into the

rule governing depositions and

interrogatories the limitations on the

scope of physician-witnesses’ testimony

at hearing. For the reasons expressed in

connection with the reproposal of

§ 725.457, the scope of allowable

physician testimony has been

broadened to allow a physician to

address all of the other medical

evidence of record. 64 FR 54996 (Oct. 8,

1999). No response is therefore

necessary to comments addressing the

operation of § 725.458, with one

exception. One commenter suggests that

§ 725.458 will permit a party to

introduce the deposition testimony of

physicians who have not previously

submitted medical reports, thereby

circumventing the evidentiary

limitations imposed by § 725.414. In the

second notice of proposed rulemaking,

the regulation governing witness’

testimony generally, § 725.457, was

amended to make the Department’s

intent clear. 64 FR 55044 (Oct. 8, 1999).

Subsection (c) specifically prohibits a

witness’ testimony, even if taken by

deposition or interrogatory, unless the

witness meets the requirements of

§ 725.414. Thus, in the absence of a

finding of good cause pursuant to

§ 725.456(b)(1), if a party has submitted

the maximum number of documentary

medical reports permitted under

§ 725.414, it may not submit the

testimony of a physician-witness at a

hearing or by deposition or interrogatory

who has not submitted a written

medical report. A physician who has

not submitted a written report may

testify only if the party has not yet

reached the maximum number of

documentary medical reports allowed.

In such a case, the physician’s

testimony would not exceed the

§ 725.414 limitations.

(c) One comment urged the

Department to replace the 30-day notice

requirement in the regulation with a

requirement that the parties need only

give ‘‘reasonable notice’’ of the date,

time and place of the deposition, and

the name and address of each person to

be examined, the current requirement

under Fed. R. Civ. P. 30(b)(1). The

Department has no reason to believe

that the 30-day notice requirement has

proved to be unworkable or even has

resulted in major inconvenience to the

parties in black lung benefits

adjudications. Parties remain free under

the regulation to agree to less than 30

days’ notice when they believe it is

reasonable to do so. Many parties to

black lung claims do not secure

representation until shortly before the

hearing, however, and the Department

believes that the 30-day notice of

deposition, if sent to an unrepresented

party, provides an appropriate period of

time not only to obtain the necessary

representation but also to arrange for

participation in a deposition.

(d) One comment submitted in

connection with the Department’s first

notice of proposed rulemaking urges the

Department to require parties to

identify, while the case is pending

before the district director, all

physicians that will be deposed. The

commenter argues that this requirement

would expedite the claims process,

eliminate surprise, and require the

timely development of positions. In its

second notice of proposed rulemaking,

the Department eliminated the proposal,

contained in the first notice of proposed

rulemaking, that parties submit all of

their documentary medical evidence

while a case is pending before the

district director. The Department

explained that the revision reflected the

wishes of numerous commenters, and

was particularly necessary in the case of

claimants who might be unable to

obtain representation until shortly

before the hearing. 64 FR 54992–93

(Oct. 8, 1999). In light of this revision,

the Department does not believe that it

would be appropriate to require parties

to identify all medical witnesses while

a case is pending before the district

director. This requirement would

effectively reinstate the original

proposal by requiring parties to

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80003

undertake the development of their case

as to medical eligibility at the earliest

stage of adjudication. The Department

believes that this suggestion would

adversely affect unrepresented

claimants. Section 725.458 provides that

all parties must give 30 days notice of

any deposition, and section 725.457(a)

provides that parties must give 10 days

notice of expert witnesses who will

testify at the hearing. The commenter

has not suggested that these time

periods, which were contained in the

program’s former regulations, have

proved to be insufficient.

(e) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.459

(a) The Department proposed revising

section 725.459 in its first notice of

proposed rulemaking in order to require

any party who compels a witness to

appear at a deposition or hearing or

respond to interrogatories for the

purpose of cross-examination to pay

that witness’s costs. The Department

also restructured and consolidated the

remainder of the regulation. 62 FR 3362

(Jan. 22, 1997). The Department

reconsidered how such costs should be

assigned in its second notice of

proposed rulemaking, and proposed that

the party offering the witness’s

affirmative testimony should also pay

any costs associated with his

subsequent cross-examination. The sole

exception to this rule pertained to

indigent claimants and required

administrative law judges to apportion

the costs of cross-examining a witness

offered by such a claimant between the

claimant and the party or parties

defending the claim. 64 FR 54997 (Oct.

8, 1999). The second proposal also

required an administrative law judge to

determine the least intrusive and

expensive means of cross-examination

as appropriate and necessary for a full

and true disclosure of the facts. 64 FR

55044 (Oct. 8, 1999).

(b) The Department has substituted

the term ‘‘shall’’ for the term ‘‘may’’ in

the fourth and fifth sentences of

subsection (b) in order to clarify its

intention that the administrative law

judge is required, rather than merely

permitted, to consider the

apportionment of the costs of crossexamination in each case involving a

witness offered by an indigent claimant.

(c) Two comments approve of the

Department’s revision of section

725.459 to impose the costs of

producing a witness for crossexamination upon the party relying on

the witness’s opinion, as well as the

provision allowing administrative law

judges to apportion costs in cases

involving indigent claimants.

(d) One comment argues that the

Department’s proposal violates section

28 of the Longshore and Harbor

Workers’ Compensation Act by

attempting to shift costs to employers in

cases other than those authorized by

statute. Section 28(d), 33 U.S.C. 928(d),

incorporated into the Black Lung

Benefits Act by 30 U.S.C. 932(a),

requires an employer to pay the costs,

fees, and mileage for necessary

witnesses attending the hearing at the

request of a claimant in any case in

which an attorney’s fee is awarded

against the employer. Section 28(d) also

requires that the necessity for the

witness and the reasonableness of an

expert witness fee be approved by an

administrative law judge, Benefits

Review Board, or court. Section 28(a)

limits an employer’s liability for

attorneys’ fees to cases in which the

claimant successfully prosecutes his

claim for benefits after the employer or

carrier contests the claimant’s

entitlement. Accordingly, the

commenter argues, the Department

cannot shift the cost of crossexamination to employers in cases

where the claimant is unsuccessful.

The Department does not agree. The

Black Lung Benefits Act incorporates a

variety of Longshore Act provisions

governing the payment of costs and fees

to witnesses. As with all such

provisions, the Act explicitly authorizes

the Department to vary the terms of

those incorporated provisions in order

to properly administer the black lung

benefits program and effectuate

Congress’s intent in providing black

lung benefits. See 30 U.S.C. 932(a)

(permitting the Secretary to ‘‘otherwise

provide[] * * * by regulations * * *’’);

Director, OWCP v. National Mines

Corp., 554 F.2d 1267, 1274 (4th Cir.

1977). In addition to section 28 of the

Longshore Act, incorporated section 7 of

the Longshore Act also governs the

payment of costs by an operator. Section

7(e) provides the Secretary with the

power to order an examination of an

employee ‘‘[i]n the event that medical

questions are raised in any case,’’ and to

authorize an additional review or

reexamination upon the request of any

party. 33 U.S.C. 907(e), as incorporated

by 30 U.S.C. 932(a). This statutory

section further provides that the

Secretary may ‘‘charge the cost of

examination or review under this

subsection to the employer, if he is a

self-insurer, or to the insurance

company which is carrying the risk, in

appropriate cases * * *.’’ Thus, by its

explicit terms, the cost-shifting

mechanism of section 7(e) is not

dependent on the miner’s successful

prosecution of his claim. Rather,

Congress, in incorporating section 7(e)

into the Black Lung Benefits Act,

demonstrated its concern that miners

not have to bear all the costs incurred

in determining their entitlement to

benefits, even in the event that they are

ultimately unsuccessful.

In drafting a regulation governing the

payment of witnesses’ fees and costs,

the Department was cognizant of its

obligation to provide all parties with the

right to conduct appropriate crossexamination of the witnesses offered by

opposing parties. In Richardson v.

Perales, 402 U.S. 388, 409 (1971), the

Supreme Court recognized that the

ability to cross-examine the preparer of

an ex parte medical report served as an

important guarantee of the reliability of

such a report. Because the

overwhelming majority of medical

issues in the adjudication of a black

lung benefits claim are decided on the

basis of ex parte medical reports, rather

than on testimony offered at the hearing,

the Department must ensure that parties

are permitted access to their opposing

party’s witnesses for the purpose of

cross-examination.

At the same time, however, the

Department must ensure that parties are

not able to prevent an opposing party

from offering a particular witness’

opinion simply by scheduling a

deposition of that witness. This is a

particular problem where the claimant

is indigent. Such a claimant must

initially pay a physician to provide him

with a medical opinion. If the operator

exercises its right to cross-examine that

physician, the claimant may not be able

to afford the additional fees and costs

necessary to pay the physician for the

time he spends answering

interrogatories or attending a

deposition. Absent a mechanism

permitting the apportionment of such

costs, the claimant may be faced with

the administrative law judge’s refusal to

consider his doctor’s opinion because

the doctor was not made available for

cross-examination. The Department

does not believe that Congress intended

this result, and does not believe that a

party’s right to cross-examination

should be used to exclude evidence

offered by an opposing party that cannot

afford the costs of expert testimony.

In those few cases in which there

might be tension, section 725.459 strikes

an appropriate balance between the

twin goals of guaranteeing the right of

cross-examination and ensuring a full

and fair adjudication of an indigent

claimant’s eligibility for benefits.

Consistent with incorporated Longshore

Act provisions, as varied in order to

80004 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

accommodate the needs of the black

lung benefits program, and based on the

Department’s inherent to authority fill

the statutory gaps left by Congress in the

Black Lung Benefits Act, the revised

regulation governing witness’ fees

represents a sensible cost-spreading

measure in those relatively few cases in

which a claimant is indigent.

(e) One comment suggests that the

Department’s witness fee regulation

violates Supreme Court precedent.

Although the commenter does not cite

any specific decision, the Court’s

seminal decisions on cost-shifting,

Crawford Fitting Co. v. J.T. Gibbons,

Inc., 482 U.S. 437 (1987), and West

Virginia University Hospitals v. Casey,

499 U.S. 83 (1991), do not prevent the

Department from shifting the costs of

cross-examination to employers in

special circumstances. In Crawford

Fitting, the Court discussed sections

1920 and 1821 of Title 28 of the United

States Code, which authorize shifting

witness fees of up to $40 per day. The

Court ‘‘held that these provisions define

the full extent of a federal court’s power

to shift litigation costs absent express

statutory authority to go further.’’ Casey,

499 U.S. at 86, explaining the decision

in Crawford Fitting. As discussed above,

the Department believes that the Black

Lung Benefits Act, by incorporating

various provisions of the Longshore Act

and authorizing the Secretary to vary

those provisions in order to administer

the black lung program, provides ample

statutory authority for the Department’s

cost-shifting regulation. The existence of

that authority compels the conclusion

that the revised regulation does not

violate the Court’s decisions in

Crawford Fitting and Casey.

(f) One comment argues that the

Administrative Procedure Act does not

provide the Department with the

authority to limit a party’s right to crossexamine an adverse witness. The

Department discussed the extent to

which the Black Lung Benefits Act

incorporates the Administrative

Procedure Act and the extent to which

the Department may vary that

incorporation by regulation in its

second notice of proposed rulemaking.

64 FR 54972 (Oct. 8, 1999). In addition,

the Administrative Procedure Act

requires only that parties be allowed 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 Seventh Circuit has recently

observed that, under the standard used

by the Social Security Administration, a

standard identical to the one in the

Administrative Procedure Act, ‘‘ ‘[c]rossexamination is * * * not an absolute

right in administrative cases.’ ’’ Butera

v. Apfel, 173 F.3d 1049, 1057 (7th Cir.

1999), quoting Central Freight Lines,

Inc. v. United States, 669 F.2d 1063,

1068 (5th Cir. 1982). The Court thus

upheld a decision by SSA not to grant

a claimant’s subpoena to compel the

attendance at the hearing by two

physicians who had examined the

claimant. See also Copeland v. Bowen,

861 F.2d 536, 539 (9th Cir. 1988)

(holding that a disability claimant is

‘‘not entitled to unlimited crossexamination, but is entitled to such

cross-examination as may be required

for a full and true disclosure of the

facts.’’); Yancey v. Apfel, 145 F.3d 106,

113 (6th Cir. 1998) (no absolute right to

subpoena reporting physician); Flatford

v. Chater, 93 F.3d 1296, 1305 (6th Cir.

1996) (same). Subsection (b) of the

revised regulation meets the APA

standard by permitting the ALJ to

determine the level of crossexamination that is required for a full

and true disclosure of the facts.

(g) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.465

(a) The Department made a technical

change to section 725.465 in its first

notice of proposed rulemaking, but did

not open the rule for comment. 62 FR

3341 (Jan. 22, 1997). In its second notice

of proposed rulemaking, the Department

proposed revising subsection (b) to

prohibit administrative law judges from

dismissing potentially liable operators

previously identified by the district

director as parties to the case, except

upon the motion or the written

agreement of the Director. 64 FR 54997

(Oct. 8, 1999).

(b) One comment argues that the

Department’s proposed limitation on the

ability of administrative law judges to

dismiss potentially liable operators as

parties to a case impermissibly usurps

the authority of administrative law

judges and violates the Administrative

Procedure Act. The commenter states

that the proposal violates the

fundamental rights of coal mine

operators and forces them to remain in

a proceeding after they have been

adjudicated not to be a proper party.

Finally, the commenter states that the

proposal violates section 424(a) of the

Act, 30 U.S.C. § 934(a).

The Department does not agree that

any party has a fundamental right to be

dismissed from a black lung benefits

adjudication prior to the final resolution

of the issue of operator liability. The

Department’s final regulations, however,

governing the treatment of claims in

which more than one company has been

named as a potentially liable operator

have rendered these objections moot

except in one instance. As finally

revised, section 725.418 requires the

district director to dismiss all but one

operator as a party before referring the

case to the Office of Administrative Law

Judges. The Department has revised

§ 725.465 accordingly. If the district

director erroneously fails to dismiss all

operators except the one finally

designated responsible pursuant to

section 725.418(d), the ALJ may do so

at any time. Subsection (b), however,

continues to prohibit the ALJ from

dismissing the responsible operator

designated by the district director

except upon the consent of the Director.

The Department believes that this

regulation remains necessary to prevent

the premature dismissal of the

designated operator by an

administrative law judge. Currently,

some administrative law judges resolve

the responsible operator issue in a

preliminary decision, and may dismiss

the responsible operator(s) identified by

the district director. In such cases, the

Director, as the representative of the

Black Lung Disability Trust Fund, must

either file an interlocutory appeal with

the Benefits Review Board, cf. Collins v.

J & L Steel, 21 Black Lung Rep. (MB) 1–

183, 1–1–186 (Ben. Rev. Bd. 1999), and

ask that the adjudication of claimant’s

entitlement be held in abeyance

pending the outcome of the appeal, or

await the ALJ’s resolution of the

claimant’s entitlement and then file an

appeal. Both options are problematic. If

the Director files an interlocutory appeal

and the Board rejects the Director’s

arguments and affirms the dismissal, the

Director may be unable to seek further

review under the stricter standards that

the federal appellate courts apply to

interlocutory orders. See, e.g., Redden v.

Director, OWCP, 825 F.2d 337, 338 (11th

Cir. 1987), citing Coopers & Lybrand v.

Livesay, 437 U.S. 463 (1978). If the

Director waits until after the claimant’s

eligibility is resolved to appeal the

responsible operator issue to the Board,

the Board may affirm the dismissal

solely because the operator did not have

an opportunity to participate in the

adjudication of the merits of the claim.

Crabtree v. Bethlehem Steel Corp., 7

Black Lung Rep. (MB) 1–354 (Ben. Rev.

Bd. 1984). Neither of these options

represents an efficient means of

resolving the issue of operator liability

in the context of adjudicating a miner’s

eligibility for benefits.

The revised regulation is intended to

eliminate these problems, and ensure

that the designated responsible operator

and the Director have the opportunity to

fully litigate the liability issue at all

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80005

levels. Moreover, the regulation does

not create any undue hardships. If, after

considering all of the evidence relevant

to the responsible operator issue, the

ALJ finds that the designated

responsible operator is not liable for the

payment of benefits, but concludes that

the claimant is entitled to benefits, the

operator merely has to wait until the

Director, on behalf of the Trust Fund,

files an appeal with the BRB. The

operator may then participate in that

appeal in defense of the ALJ’s liability

determination if it wishes. If the

Director does not petition for review of

the ALJ’s liability decision, the operator

need not participate in any further

adjudication of the case, regardless of

whether it is formally included as a

party.

Moreover, the revised regulation

violates neither section 424 of the Black

Lung Benefits Act, 30 U.S.C. 934, nor

the Administrative Procedure Act.

Section 424 requires coal mine

operators who have been determined to

be liable for the payment of benefits to

a claimant to reimburse the Black Lung

Disability Trust Fund for amounts the

Trust Fund paid to that claimant on an

interim basis. The statute requires,

however, that the operator’s liability

have been ‘‘finally determined’’ before

the reimbursement obligation may be

enforced. 30 U.S.C. 934(b)(4)(B). Under

the incorporated provisions of the

Longshore and Harbor Workers’

Compensation Act, that final

determination includes not only an

administrative law judge’s decision, but

also decisions by the Benefits Review

Board and the court of appeals.

Obviously, an appeal by an aggrieved

party, including the Director, OWCP, on

an operator liability issue cannot

proceed in the absence of all the

necessary parties. Thus, it is necessary

that the designated responsible operator

remain a party to a claim even while it

is on appeal. Similarly, nothing in the

Administrative Procedure Act gives

administrative law judges the authority

to issue final decisions on issues.

Accordingly, the revised regulation does

not violate any statutory provision. As

revised, § 725.465 simply ensures that

no responsible operator designated by

the district director will be dismissed

prior to a final determination of

claimant eligibility and operator

liability except with the approval of the

Director.

Finally, the regulation does not

preclude the designated responsible

operator, in a case in which the district

director committed an obvious error,

from seeking the written agreement of

the Director that it be dismissed as a

party. The regulation, rather than giving

the Director’s representative veto power

over an ALJ’s decision, as the

commenter asserts, simply protects the

interests of the Trust Fund, and ensures

that the Director, as a party to the

litigation, receives a complete

adjudication of his interests. The Board

has upheld the similar requirement in

subsection (d), which prohibits the

dismissal of a claim in which the

claimant has been paid interim benefits

from the Trust Fund, absent the

Director’s consent. Boggs v. Falcon Coal

Co., 17 Black Lung Rep. (MB) 1–62, 1–

66 (1992).

(c) No other comments have been

received concerning this regulation and

no changes have been made in it.

20 CFR 725.478

(a) The Department proposed revising

this regulation in its initial notice of

proposed rulemaking in order to

recognize the opinions of three

appellate courts and the Benefits

Review Board that had rejected the

Department’s interpretation of the

former regulation. The Department had

argued that under the former regulation

an administrative law judge’s decision

and order should be considered filed on

the date that the ALJ mailed it to the

parties. The proposal adopted the view

that the date of actual receipt of an

administrative law judge’s decision and

order by the Division of Coal Mine

Workers’ Compensation (DCMWC)

constitutes its filing date and renders

the decision effective. Thus, the date of

DCMWC’s receipt triggers the running of

the 30-day period for challenging an

administrative law judge’s decision. The

proposal conformed the regulation to

existing caselaw. 62 FR 3362–63 (Jan.

22, 1997). The Department also

proposed moving the last two sentences

of the former regulation to a more

appropriate location in § 725.502. The

Department did not discuss this

regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) One comment stated that the

revised regulation would extend the

appeal time by several days, presumably

because of the time used to send the file

from the Office of Administrative Law

Judges to DCMWC. The courts, however,

rejected the Director’s interpretation of

the former regulation because it

impermissibly shortened the 30-day

statutory appeal time. Trent Coal Co. v.

Day, 739 F.2d 116, 118 (1984);

Daugherty v. Director, OWCP, 897 F.2d

740, 742 (1990). Following the

reasoning of these decisions, the

revision does not lengthen the appeal

time, but simply recognizes the appeal

time guaranteed by the statute.

(c) No further comments have been

received concerning this section, and no

changes have been made in it.

20 CFR 725.479

(a) In its first notice of proposed

rulemaking, the Department proposed

adding subsection (d) to provide that the

30-day period to appeal an

administrative law judge’s decision and

order will commence upon a party’s

receipt of that document even though it

was not served by certified mail or there

was some other defect in service. 62 FR

3363 (Jan. 22, 1997). The Department

did not discuss this regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999).

(b) Several comments suggest that

subsection (d) is unnecessary because

strict adherence to the requirement in

§ 725.478 for service of an

administrative law judge’s decision by

certified mail would eliminate any

question as to the date of receipt of that

decision. Subsection (d) does not

supplant the requirement for serving

decisions by certified mail. It simply

establishes that actual receipt of a

decision overcomes any technical defect

in service for purposes of triggering

appeal and reconsideration rights. These

defects are not limited to cases where

service is not made by certified mail.

For example, a decision may be mailed

to the wrong address but the party to

whom it should have been sent later

learns of the decision and obtains a

copy. The revised regulation would

begin the 30-day appeal period upon

that party’s receipt. The provision thus

provides an element of finality to

decisions while protecting the parties’

rights to pursue litigation in a timely

manner.

(c) One comment objects to subsection

(d) as too technical and subject to

violation by unwary litigants. The

Department disagrees with this

characterization. Subsection (d)

eliminates any doubt that a party must

exercise its options for challenging a

decision in a timely manner once the

party has received the decision and

despite any defect in service. This

provision therefore protects the

litigants’ rights and interests by

dispelling any confusion as to the

effectiveness of any decision which

reaches the parties despite technical

nonconformance with the service

process.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

80006 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Subpart G

20 CFR 725.490

In its first notice of proposed

rulemaking, the Department proposed

the reorganization and renaming of the

rules governing the identification of

responsible coal mine operators. Section

725.490 retained its title and much of its

language. The Department proposed

deleting the last clause of the last

sentence of subsection (b), however, in

order to reflect a move to part 726 of the

regulations governing the obligations of

coal mine operators to secure the

payment of benefits. 62 FR 3363–65

(Jan. 22, 1997). No comments were

received concerning this section, and no

changes have been made in it.

20 CFR 725.491

(a) The Department proposed revising

section 725.491 in order to clarify the

meaning of the statutory term

‘‘operator.’’ 62 FR 3363 (Jan. 22, 1997).

Section 725.491 retains some material

from the Secretary’s current regulations,

such as the rebuttable presumption of

exposure to dust currently found in 20

CFR 725.492(c). Much of section

725.491’s language is new, however. In

particular, the Department sought to

ensure that terms critical to the

identification of a company potentially

liable for the payment of benefits under

the Black Lung Benefits Act, such as

‘‘owner’’ and ‘‘independent contractor,’’

were defined broadly in keeping with

Congress’ intent that the coal mining

industry bear liability for individual

claims to the maximum extent feasible.

The Department’s goal in proposing

these revisions was to insure that any

company, partnership, or individual

that employed a ‘‘miner’’ could be held

liable under the Act. The regulation also

implements the Department’s view that

the officers of an uninsured corporate

coal mine operator should not be

considered coal mine operators in their

own right. The Benefits Review Board

has recently accepted that view with

respect to the Department’s current

regulations. Lester v. Mack Coal Co., 21

Black Lung Rep. (MB) 1–126, 1–130–131

(Ben. Rev. Bd. 1999).

In its second notice of proposed

rulemaking, the Department revised

subsection (a)(2)(i) in response to one

comment to ensure the consistent use of

the term ‘‘coal mine dust’’ rather than

‘‘coal dust.’’ 64 FR 54998 (Oct. 8, 1999).

In addition, the Department responded

to comments about its definition of

independent contractors in subsection

(c) and its exclusion of the federal

government and state governments as

operators in subsection (f). 64 FR

54997–98 (Oct. 8, 1999).

(b) One comment suggests that

retroactive application of the

Department’s revised responsible

operator regulations is impermissible.

Although these new regulations will

apply only to claims filed after the date

on which the revisions become

effective, see § 725.2, the commenter

argues that the Department is expanding

the scope of the term ‘‘operator,’’ and

that with respect to refiled claims, the

newly amended definition will be

applied retroactively. In this regard, the

commenter argues that the Department’s

reliance on the jurisdiction of the Mine

Safety and Health Administration to

regulate under the Black Lung Benefits

Act is inappropriate. We understand the

commenter’s argument to be that the

Department should not have relied on

cases decided under the Federal Mine

Safety and Health Act (FMSHA) in

promulgating its definition of the term

‘‘operator.’’ The Department cited such

cases in both notices of proposed

rulemaking. 62 FR 3364 (Jan. 22, 1997);

64 FR 54997–98 (Oct. 8, 1999). The

commenter suggests that the MSHA’s

jurisdiction is based on an agreement

with the Occupational Safety and

Health Administration (OSHA) to

ensure that all American workplaces are

subject to inspection by one of the two

agencies, and that the Department’s

adoption of FMSHA criteria represents

an expansion of coverage under the

Black Lung Benefits Act.

The Department disagrees with the

premise of the argument. The Black

Lung Benefits Act, which is subchapter

IV of the Federal Mine Safety and

Health Act, has incorporated the

definition of the term ‘‘operator’’ found

in section 3(d) of the FMSHA, 30 U.S.C.

802(d), since its enactment in 1969. The

Secretary’s regulations do not attempt to

expand that definition, either by

imposing liability on companies that are

not currently liable for benefits, or by

increasing the number of employees for

which a coal mine operator may be held

liable. The Black Lung Benefits Act and

the Secretary’s implementing

regulations have consistently contained

expansive definitions of terms such as

‘‘operator’’ and ‘‘independent

contractor,’’ see, e.g., 20 CFR

725.491(b)(1)(company need not

directly supervise work in order to be

considered an operator). In addition,

regardless of any agreement between

MSHA and OSHA, the definitions set

forth in the FMSHA create an outer

limit for MSHA’s jurisdiction; MSHA

simply cannot exercise authority over

employers and activities not covered by

the FMSHA. These definitional

provisions also govern the extent of

coverage under the Black Lung Benefits

Act. Accordingly, the regulations

implementing the Black Lung Benefits

Act must recognize and account for the

extent of coverage provided by the

FMSHA.

(c) One comment argues that even if

certain individuals, such as food service

workers, may be considered ‘‘miners’’

under the BLBA, the Department should

not require the employers of such

individuals to bear liability for the

payment of any benefits to which they

become entitled. The commenter

suggests that the Department’s

regulation would require a number of

companies with only a tenuous

relationship to the mining of coal to

purchase insurance in order to cover the

risk that they will be liable for the

payment of benefits. Adopting the

commenter’s suggestion that these

companies should be exempt from

liability, however, would require

imposing potential liability for their

employees’ claims on the Black Lung

Disability Trust Fund. In its initial

proposal, the Department took note of

Congress’ intent that the coal mining

industry, rather than the Black Lung

Disability Trust Fund, bear liability for

the payment of individual claims to the

maximum extent feasible. See 62 FR

3363 (Jan. 22, 1997). Accordingly, if

individuals whose work is integral to

the extraction or preparation of coal but

who may not be considered traditional

coal miners are determined to be

entitled to benefits under the Act as a

result of occupational exposure to coal

mine dust, their employers must bear

responsibility for the payment of those

benefits. For example, individuals who

transport coal during the extraction or

preparation process, Norfolk & Western

Railway Co. v. Roberson, 918 F.2d 1144,

1149–50 (4th Cir. 1990), cert. denied,

500 U.S. 916, and who deliver supplies

essential to the extraction or preparation

of coal, Pinkham v. Director, OWCP, 7

Black Lung Rep. (MB) 1–55, 1–57 (Ben.

Rev. Bd. 1984), have been determined to

be ‘‘miners’’ under the Black Lung

Benefits Act. The regulatory definition

of the term ‘‘operator’’ must be broad

enough to ensure that the employer of

such an individual bears direct liability

for any benefits to which the miner is

entitled.

(d) One comment objects to the

Department’s exclusion in subsection (f)

of state and federal governments from

the term ‘‘operator.’’ With respect to

state governments, the commenter

argues that there is no indication that

Congress intended to exempt the states

from the Act’s broad coverage of coal

mine operators. As the Department has

previously explained, however, the test

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80007

under relevant Supreme Court decisions

is not whether Congress indicated its

intention to exempt the states from

coverage, but whether Congress

indicated a clear intention to include

the states. See 64 FR 54998 (Oct. 8,

1999), discussing Gregory v. Ashcroft,

501 U.S. 452 (1991). The commenter

does not allege that the BLBA meets this

test with respect to state governments,

noting only that the language of the Act

could easily be construed to cover state

employees. Although the commenter

also objects to the exemption from

liability under the Black Lung Benefits

Act of the federal government, it argues

that federal mine inspectors, the only

federal employees who could be

potentially covered by the BLBA,

should not be considered ‘‘miners.’’ The

Department agrees, and has taken the

same position in litigation.

The commenter’s true complaint

appears to be that the liability for

benefits payable to a claimant who was

a miner before he became a coal mine

inspector will fall on the operator that

employed the claimant as a miner. The

Fourth Circuit interpreted the

Department’s current regulations to

require this result in Eastern Associated

Coal Corp. v. Director, OWCP, 791 F.2d

1129, 1131–32 (4th Cir. 1986).

Specifically, the court held that to the

extent that an individual contracts

pneumoconiosis as a result of work as

a federal coal mine inspector, his

exclusive remedy against the

government lies under the Federal

Employees’ Compensation Act (FECA),

5 U.S.C. 8101 et seq. If such an

individual is also able to obtain benefits

under the Black Lung Benefits Act,

based on other work as a miner, liability

for those benefits rests with the coal

mine operator that most recently

employed the individual as a miner. See

also Consolidation Coal Co. v. Borda,

171 F.3d 175, 179 (4th Cir. 1999). The

commenter has offered no reason for the

Department to revise its regulation to

produce a different outcome.

(e) No other comments have been

received concerning this section, and no

changes have been made in it.

20 CFR 725.492

(a) The Department proposed revising

section 725.492 to specifically define

the term ‘‘successor operator’’ and

address the issues posed by this

category of coal mine operator. 62 FR

3364 (Jan. 22, 1997). The revised

regulation largely tracks the language of

section 422(i) of the Act, 30 U.S.C.

932(i), and provisions contained in the

current version of 20 CFR 725.493. In

addition, the Department clarified the

definition to give effect to Congress’

demonstrated interest in ensuring that a

wide variety of commercial transactions

was sufficient to give rise to successor

liability under the Black Lung Benefits

Act. 30 U.S.C. 932(i)(3). The Department

did not make any additional revisions to

this regulation in its 1999 proposal, 64

FR 54998–99 (Oct. 8, 1999), but did

respond to two comments relating to the

purchase of coal assets in a corporate

reorganization or liquidation and the

primary liability of a prior operator’s

insurance company.

(b) One comment states that

subsection (e) exceeds the scope of the

Act by suggesting that a purchase of

mineral rights alone may be sufficient to

attach liability to the purchaser as a

successor operator. The commenter

argues that the BLBA imposes liability

only on operators of coal mines.

Subsection (e) defines ‘‘acquisition’’ of a

coal mine to include any transaction

that transfers the right to extract or

prepare coal at a mine. This regulation

is based on the statutory definition of an

‘‘operator,’’ which includes not only the

operator of a mine but also the mine’s

owner. 30 U.S.C. 802(d). In addition, the

Department’s regulations have long

recognized that the lessor of coal mining

property may bear liability for the

payment of benefits in certain cases. See

20 CFR 725.491(b)(2) (1999). The

Department does agree, however, that,

in order to become liable as a successor

operator, the acquirer of mining

property must continue to derive an

economic benefit from the coal on the

property. Thus, the mere acquisition of

mineral rights alone, without the actual

extraction, preparation, or

transportation of coal, or coal mine

construction, will not subject the

acquirer to successor operator liability.

(c) No other comments have been

received concerning this section. The

Department has added a comma in

subsection (c) and deleted a comma in

subsection (d)(1) in order to clarify the

punctuation of the regulation.

20 CFR 725.493

(a) In its first notice of proposed

rulemaking, the Department proposed

revising section 725.493 to define the

required relationship between a coal

mine operator and a coal miner, the

statutory basis for an operator’s liability

for the miner’s claim under the Black

Lung Benefits Act. 30 U.S.C. 932(a). 62

FR 3364 (Jan. 22, 1997). The Department

made a technical change in its second

notice of proposed rulemaking. It also

added more specific language to

subsection (a)(1) to recognize as

sufficient to establish the requisite

employment relationship a variety of

arrangements between a worker and the

entity that supervises that work. 64 FR

54999 (Oct. 8, 1999).

(b) One comment states that the

Department’s regulation will eliminate

the current operator practice of leasing

employees. The Department’s response

to this comment is set forth under

section 726.8. No other comments have

been received concerning this section,

and no changes have been made in it.

20 CFR 725.494

(a) Section 725.494 provides the

criteria for the identification of one or

more ‘‘potentially liable operators’’ with

respect to a claim for benefits. 62 FR

3364 (Jan. 22, 1997). For each claim, the

group potentially includes all of those

operators who meet the criteria

currently contained in 20 CFR 725.492

and 725.493 (e.g., employment of the

miner for a year, including at least one

day after December 31, 1969). This

revised regulation also explains the

factors used to consider whether a

company is financially capable of

assuming liability for the payment of

benefits. In the second notice of

proposed rulemaking, the Department

made several technical changes to the

regulation to make it easier to read. 64

FR 54999 (Oct. 8, 1999). The

Department responded to one comment

contending that the presumption in

subsection (a) was illegal by citing the

broad statutory grant of authority given

the Department to create regulatory

presumptions and by noting that the

presumption appears in the current

regulations at 20 CFR 725.493(a)(6). The

Department responded to a comment

concerning subsection (e) by explaining

that subsection (e) did not contain a

presumption, but simply recited the

evidence needed to support a finding

that an operator is financially capable of

assuming liability for the payment of

benefits. The Department further

explained that the criteria in section

725.494 have no effect on a miner’s

eligibility for benefits.

(b) One comment received in

connection with the Department’s

consideration of alternatives under the

Regulatory Flexibility Act urges the

Department to identify only the coal

mine operator that is most likely to be

liable for the payment of benefits as the

responsible operator. The commenter

does not distinguish between processing

the claim at the district director level

and the formal adjudication of the claim

beyond that level. The commenter’s

main concern, however, appears to be

the transaction costs imposed by the

proposed ‘‘joint defense’’ requirement.

The Department has eliminated the

requirement that operators participate in

the joint defense of the claimant’s

80008 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

entitlement by prohibiting more than

one operator from participating in a case

beyond the district director level, and

by requiring the district director to

exclude from the record any

documentary medical evidence

submitted by an operator other than the

finally designated responsible operator.

See explanation accompanying

§§ 725.414, 725.415, 725.421. This

revision does not require any alteration

in the text of § 725.494. To the extent

that the commenter is objecting to the

district director’s notification of more

than one operator as potentially liable

operators, the Department’s explanation

of the need for this requirement is set

forth in the preamble to § 725.407.

In addition, a number of courts have

been critical of the length of time it

takes to resolve individual black lung

benefits claims, see, e.g., C&K Coal Co.

v. Taylor, 165 F.3d 254, 258 (3d Cir.

1999), and have held that the delays

may deprive operators of their due

process rights. Lane Hollow Coal Co. v.

Director, OWCP, 137 F.3d 799, 807 (4th

Cir. 1998). Some of these delays have

been caused by remands from the Office

of Administrative Law Judges in order

to require the identification of

additional responsible operators and the

development of more evidence on

responsible operator issues. The

Department’s revised regulations

governing the identification and

adjudication of the liable coal mine

operator are intended to prevent such

delays from occurring in the future. In

all claims filed after the effective date of

these revisions, the Department will

have only one opportunity, while the

case is pending before the district

director, to obtain evidence from the

operators that employed the miner. To

facilitate the district director’s

resolution of the responsible operator

issue, the regulations require the

submission of evidence relevant to the

criteria in section 725.494 to the district

director and enhance the district

director’s ability to use subpoenas to

compel the production of additional

documents. Once all of this evidence is

forwarded to the Office of

Administrative Law Judges for a formal

hearing, the administrative law judge

assigned to the case will determine, in

light of the evidentiary burdens

imposed by section 725.495, whether

the district director designated the

proper responsible operator. If the

administrative law judge determines

that the district director did not

designate the proper responsible

operator, liability will fall on the Trust

Fund. No remand for further

development of the responsible operator

issue is permissible.

(c) No comments have been received

specifically relating to this section, and

no changes have been made in it.

20 CFR 725.495

(a) Section 725.495 contains the

criteria for deciding which of the

miner’s former employers will be the

responsible operator liable for the

payment of benefits to the miner and/or

his survivors. 62 FR 3364–65 (Jan. 22,

1997). From among the employers that

meet the criteria in § 725.494 for a

potentially liable operator, section

725.495 assigns liability to the company

that most recently employed the miner.

In addition, the regulation explicitly

assigns burdens of proof in the

adjudication of the responsible operator

issue. The regulation thus fills the

regulatory void noted by the Fourth

Circuit in Director, OWCP v. Trace Fork

Coal Co., 67 F.3d 503, 507 (4th Cir.

1995). In its second notice of proposed

rulemaking, the Department again

addressed this issue, rejecting

arguments that the Department’s

assignment of burdens of proof violated

the Fourth Circuit’s decision. 64 FR

54999 (Oct. 8, 1999).

(b) The Department has revised the

language of the first sentence of

subsection (d) to reflect changes in the

manner in which the district director

will process claims, set forth in

§§ 725.410–725.413, as well as the

change in § 725.418(d) which prohibits

the district director from forwarding a

case to the Office of Administrative Law

Judges with more than one operator as

a party. See explanation accompanying

§ 725.414. The district director will

identify the designated responsible

operator in a document titled a schedule

for the submission of additional

evidence rather than in an initial

finding. See explanation accompanying

§§ 725.410–725.413. Moreover, to help

ensure that the district director properly

identifies the responsible operator,

sections 725.415 and 725.417 permit the

district director to re-designate the

responsible operator, by issuing another

schedule for the submission of

additional evidence, if he determines

that his initial designation may have

been erroneous. See explanation

accompanying §§ 725.415 and 725.417.

Accordingly, the Department has

replaced the reference in subsection (d)

to the operator ‘‘initially found liable’’

with a reference to the operator that is

‘‘finally designated’’ as the responsible

operator.

(c) One comment suggests that a

miner’s prior employer should not have

to bear liability for a claim when the

financial inability to pay benefits of

another coal mine operator who more

recently employed the miner is the

responsibility of the Department. For

example, the commenter notes, the

Department accepted as insurers a

number of ‘‘group self-insurance

associations’’ that are currently unable

to make benefit payments because they

did not adequately secure the payment

of claims for which they were ultimately

held liable. Under section 423(a)(2) of

the Act, 30 U.S.C. 933(a)(2), however,

the Department is obligated to accept

insurance coverage from any company,

association, person or fund that is

authorized under the laws of any State

to insure workmen’s compensation.

Compare 33 U.S.C. 932(a)(1)(B)

(Longshore and Harbor Workers’

Compensation Act provision giving the

Department authority to approve

insurers under that Act). Accordingly,

the Department’s ‘‘decision’’ to accept

these state group associations as

insurers was not based on an exercise of

discretion but rather on the

understanding that they were

authorized under the laws of their states

to insure workers’ compensation. The

Department thus did not voluntarily

assume the risk that these associations

would become insolvent.

By contrast, the Department does have

the authority to accept or reject

applications for self-insurance and to set

the minimum standards applicable for

qualifying as a self-insurer. 30 U.S.C.

933(a)(1). To the extent that the security

deposited by a self-insured coal mine

operator pursuant to § 726.104 proves

insufficient to pay individual claims,

the Department agrees that the liability

for those claims should not be placed on

operators that previously employed the

miner. Rather, in establishing the

amount of security required, the

Department voluntarily accepts the risk

that self-insured operators will not have

deposited sufficient security to pay

claims if they are liquidated or become

bankrupt.

Accordingly, the Department has

added paragraph (a)(4) to section

725.495. The regulation does not affect

the liability of any operator that

employed the miner after his

employment with the self-insured

operator ended, even if that latter

employment only lasted one day,

provided the miner’s cumulative period

with that employer totalled at least one

year. In determining the length of this

cumulative period, the factfinder should

include any period for which the

employer is considered a successor

operator to the miner’s actual employer,

see C&K Coal Co. v. Taylor, 165 F.3d

254, 257 (3d Cir. 1999). Like the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80009

remainder of section 725.495, this

provision shall be applicable only to

claims filed after the date upon which

these revisions become effective. This

provision does not affect the liability of

any operator that employed the miner

after he left employment with the selfinsured operator.

(d) Several comments continue to

object to the imposition of a burden of

proof on the potentially liable operator

that the Department designates as the

responsible operator. The regulation

imposes on the Department the initial

burden of establishing that the

designated operator is a potentially

liable operator, assisted by a

presumption in subsection (b) that the

designated operator is financially

capable of assuming liability for the

payment of benefits. In addition, if the

district director designates as the

responsible operator any operator other

than the miner’s most recent employer,

he must include in the record a

statement explaining the reasons for his

finding and, if appropriate, an

explanation of the Department’s search

of its insurance files. The burden then

shifts to the designated responsible

operator to prove either that it is

financially incapable of assuming

liability for the payment of benefits or

that another potentially liable operator

(i.e., an operator that meets the criteria

in § 725.494) employed the miner more

recently. The Department’s rationale for

this revision is fully set forth in its

explanation of the original proposal. 62

FR 3363–65 (Jan. 22, 1997).

(e) One comment argues that the

Department’s imposition of the burden

of proof on the designated responsible

operator violates the Supreme Court’s

decisions in Director, OWCP v.

Greenwich Collieries, 512 U.S. 267

(1994) and Metropolitan Stevedore Co.

v. Rambo, 117 S. Ct. 1953 (1997), as

well as the Administrative Procedure

Act. The Department’s response to this

comment is fully set forth at 64 FR

54972–74 (Oct. 8, 1999). Congress gave

the Department particularly broad

authority to promulgate regulations

governing the identification of the

operator responsible for the payment of

benefits, 30 U.S.C. 932(h), including the

authority to create ‘‘appropriate

presumptions’’ for determining whether

pneumoconiosis arose out of a miner’s

employment with an individual coal

company, and to establish ‘‘standards

for apportioning liability among more

than one operator, where such

apportionment is appropriate.’’ This

authority has been construed to permit

the assignment of liability to a single

operator. See National Independent

Coal Operators Association v. Brennan,

372 F. Supp. 16, 24 (D.D.C.), aff’d, 419

U.S. 955 (1974). The burdens imposed

by section 725.495 are thus fully

consistent with the statutory authority

granted the Department.

(f) Two comments argue that

potentially liable operators should not

be required to submit all of their

evidence demonstrating the liability of

other more recent of the miner’s

employers within the first 90 days after

they receive notice of the claim. As the

Department has discussed more fully in

its response to comments concerning

section 725.408, the 90-day time limit in

that regulation is applicable only to the

submission of evidence, generally

within the control of an operator

notified by the Department, which

establishes that the operator is not a

potentially liable operator in the claim.

This includes evidence that the

employer was not an operator for any

period after June 30, 1973; that the

operator did not employ the miner as a

miner for a cumulative period of at least

one year; that the miner was not

exposed to coal mine dust while

working for the employer; that the

miner’s employment did not include at

least one working day after December

31, 1969; and that the employer is

financially incapable of assuming

liability for the payment of benefits. See

§§ 725.408(a)(2)(i)–(v), 725.494(a)–(e).

By contrast, documentary evidence

submitted to demonstrate a more recent

employer’s potential liability is

governed by section 725.414, which

states that the evidence must be

submitted pursuant to a schedule

established by the district director after

a party has indicated its dissatisfaction

with the district director’s initial

findings of eligibility and liability. The

submission of this evidence is therefore

not subject to the 90-day time limit.

(g) No other comments have been

received concerning this section, and no

other changes have been made in it.

20 CFR 725.497

Although the Department received

comments relevant to this section, the

regulation was not open for comment,

see 62 Fed. Reg. 3341 (Jan. 22, 1997); 64

Fed. Reg. 54971 (Oct. 8, 1999). It was

inadvertently omitted from the list of

technical revisions. Accordingly, no

changes are being made in this section.

Subpart H

20 CFR 725.502

(a) The Department proposed

significant changes to the current

§ 725.502 in its initial notice of

proposed rulemaking. 62 FR 3412–13

(Jan. 22, 1997). The most important

changes were designed to make clear to

responsible operators their obligations

under the terms of an effective award of

benefits even though the claim might

still be in litigation. By clarifying the

obligations of a liable party pursuant to

an effective award, the Department

hoped to promote operator compliance.

62 FR 3366 (Jan. 22, 1997). The

Department therefore proposed that a

responsible operator pay all of the

benefits due under the terms of an

effective award, i.e., both prospective

monthly benefits and retroactive

benefits. The proposed regulation also

defined when benefits become due after

the issuance of an ‘‘effective’’ decision

awarding benefits. 62 FR 3412–13 (Jan.

22, 1997). Coupled with an assessment

of an additional twenty-percent of any

unpaid compensation (33 U.S.C. 914(f)

as incorporated by 30 U.S.C. 932(b),

proposed § 725.607), proposed § 725.502

substantially clarified the responsible

operator’s benefit payment obligations.

In its second notice of proposed

rulemaking, the Department responded

to comments opposing the changes.

Without disputing the statutory

incorporation of § 14(f), the commenters

contended that the addition of twentypercent of unpaid compensation to late

payments was punitive. They also

opposed the obligation to pay

retroactive benefits while an award was

on appeal, arguing such a requirement

violated Congressional intent and that

recovery of those payments was

unlikely in the event the award was

overturned. 64 FR 54999–55000 (Oct. 8,

1999). Citing Congressional intent that

the coal industry bear primary

responsibility for benefits, the

Department defended the assessment of

an additional twenty-percent of unpaid

compensation as a means to promote

prompt compliance with effective

awards. The Department noted its

concern that operators rarely paid

benefits while an award was on appeal,

thereby shifting the financial burden

and ultimate risk of loss to the Trust

Fund. Moreover, the Department noted

that requiring payment of retroactive

benefits during active litigation was

consistent with Congressional intent.

The liable party is generally required to

pay all benefits due the claimant under

the terms of an effective award, and the

‘‘benefits due’’ include retroactive

benefits. Congress enacted one

exception: the Trust Fund is authorized

to pay only future monthly benefits

when it pays on behalf of an operator.

64 FR 55000 (Oct. 8, 1999). In response

to another comment, the Department

agreed that the law clearly requires the

Trust Fund to pay interim benefits if an

80010 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

operator obtains a stay of payments. The

Department also concluded the

proposed regulation required the

operator to continue to pay benefits

despite the pendency of a modification

petition until a new effective order is

issued pursuant to § 725.310. Finally,

the Department reiterated its view that

prospective monthly benefits are due

and ‘‘shall be paid’’ when an

administrative law judge’s award

becomes effective, i.e., when the order is

filed in the office of the district director.

The Department did propose one change

to § 725.502(b)(1) in its second notice.

That change made monthly benefits due

on the fifteenth day of the month

following the month for which the

benefits are paid, instead of the first

business day of that month as originally

proposed. 64 FR 55050 (Oct. 8, 1999).

The Department has proposed one

minor change in the final rule.

Subsection (b)(2) requires the district

director to compute the amount of

retroactive benefits and interest a

responsible operator owes the claimant,

and to inform the parties. The

Department has added language at the

end of the last sentence of subsection

(b)(2) to clarify that the district director

must attach a current table of applicable

interest rates to the computation.

(b) The Department has received one

new comment in response to the second

notice of proposed rulemaking. The

commenter renews the objections stated

in its response to the initial notice of

proposed rulemaking, contending the

Department did not respond adequately

to its concerns in the 1999 preamble

discussion. The comment cites several

objections to requiring payment of

retroactive benefits while an award is on

appeal, and also objects to the

assessment of the twenty-percent

additional compensation for failure to

pay such benefits. Specifically, the

comment argues that use of the twentypercent additional compensation is

inconsistent with Congressional intent

because the assessment was intended

only to help claimants obtain prompt

payment, and not reduce Trust Fund

outlays. The comment also contends

Congress intended the Fund to pay

interim benefits during litigation on

behalf of operators, and recoup those

payments from operators only after the

claimant ultimately prevails. In the

commenter’s view, Congress intended

the Fund to share the risk of

unsupportable awards with operators by

assuming the operator’s liability until

litigation concluded and the validity of

the award was established. The

comment criticizes § 725.502(b)(2)

because it will increase operator

payments and lead to larger, and more

numerous, overpayments. Finally, the

comment objects to § 725.502(c), which

requires the payment of one month of

benefits if the miner-claimant dies in

the month when eligibility commences.

The comment states that the provision,

in effect, allows duplicate benefits for

that month in the event the survivor

becomes entitled to benefits.

(c) The criticisms leveled at

§ 725.502(b)(2) rest on one basic

premise: Since 1981, Congress has

intended for the Trust Fund to pay

prospective monthly benefits in all

awarded claims remaining in litigation

in which there is potential operator

liability. Based on this premise, the

commenter contends that an operator

cannot be compelled by means of the

§ 14(f) ‘‘penalty’’ to pay any benefits—

retroactive or prospective—until the

award is final because no retroactive

benefits are due and the Trust Fund is

liable for the prospective benefits

pending entry of a final award. The

Department disagrees with the

comment’s premise and the conclusions

derived from it.

As an initial matter, the comment

does not cite any statutory section, legal

authority, legislative history or other

evidence for its position as to

Congressional intent and the operation

of the Trust Fund. It relies, instead, on

an ‘‘understanding’’ or ‘‘agreement’’

between Congress and the members of

the public affected by the 1981

amendments to the Black Lung Benefits

Act (BLBA). None of the available

material, however, supports the

comment’s views.

First, the expenditures which the

Fund may undertake are a matter of

statutory mandate. Under the Internal

Revenue Code (in which the Trust Fund

provisions appear), monies are available

if ‘‘the operator liable for the payment

of such benefits * * * has not made a

payment within 30 days after that

payment is due[.]’’ 26 U.S.C.

9501(d)(1)(A)(ii). The only limitation

prohibits the payment of retroactive

benefits by the Fund on behalf of

operators in claims filed after the 1981

amendments. 26 U.S.C. 9501(d)(1)(A).

The provision is clear: The operator is

liable for any benefits which are due,

and the Fund will pay only prospective

benefits if the operator defaults. Section

9501(d)(1)(A)(ii) does not suggest

Congress intended as a routine practice

to relieve the operator of the obligation

to pay benefits which are due while the

claimant’s entitlement remains in

dispute.

Second, the legislative history of the

creation and later-amended operation of

the Black Lung Disability Trust Fund

supports the Department’s position. The

historical antecedents are described in

detail in Old Ben Coal Co. v. Luker, 826

F.2d 688, 693–94 (7th Cir. 1987).

Briefly, Congress created the Fund in

1978 to relieve the federal government

of its de facto primary financial

responsibility for the Part C program.

The Fund assumed responsibility for

claims for which no operator was liable

or in which the responsible operator

defaulted on its payment obligations.

Congress intended to ‘‘ensure that

individual coal operators rather than the

trust fund bear the liability for claims

arising out of such operator’s mines to

the maximum extent feasible.’’ S. Rep.

95–209, 95th Cong., 1st Sess. 9 (1977),

reprinted in Committee on Education

and Labor, House of Representatives,

96th Cong., Black Lung Benefits Reform

Act and Black Lung Benefits Revenue

Act of 1977 at 612 (Comm. Print) (1979)

(emphasis supplied). By the conclusion

of the 1981 fiscal year, however, the

Fund had accumulated a deficit of

approximately $1.5 billion. H.R. Rep.

97–406, 97th Cong., 1st Sess. 4 (1981),

reprinted in U.S.C. C. & A.N. 2673.

Individual responsible operators had

also become burdened with

unanticipated retroactive liabilities from

denied claims which were reopened and

approved under the 1978 legislation.

Congressional concern over the Trust

Fund’s deficit prompted changes to the

BLBA in 1981; the remedial actions

included raising the excise tax on coal

that provided revenue for the Fund,

increasing the interest rate on operator

liabilities to the Fund, and tightening

eligibility criteria for claimants.

Congress also relieved a limited group

of operators from their retroactive

liabilities based on the procedural

histories of certain claims. These

liabilities transferred to the Fund.

Finally, Congress limited the Trust

Fund to paying only prospective

benefits if a responsible operator failed

or refused to pay after entry of an initial

determination of entitlement. The 1981

Amendments, however, did not disturb

the operator’s legal obligation to pay all

benefits due under an effective award.

127 Cong. Rec. 29,932 (1981).

Against this background, the

comment’s position is untenable. In

1981, Congress amended the BLBA, in

large part because the Fund was in

economic crisis. The objective of the

amendments was to eliminate the deficit

by increasing revenues and revising

eligibility criteria. A fiscally-concerned

Congress would not then impose on the

Fund the operators’ collective liability

for benefits pending conclusion of

entitlement litigation in every claim.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80011

The ability to recoup from the operator

the amount paid by the Fund if the

award survived litigation, plus interest,

would restore only some of the revenues

expended on interim benefits. Initial

awards which were eventually

overturned would become

overpayments; recovering overpayments

from a largely elderly and unemployed

population was problematic at best.

Given these circumstances, the

Department rejects the argument that

Congress intended the Fund to absorb

all operators’ liabilities as a matter of

course until the conclusion of litigation

in every approved claim.

The Department also rejects the

comment’s argument that vigorous use

of the payment of additional

compensation pursuant to section 14(f)

is contrary to Congressional intent. The

Department provided a detailed

response to this argument in its second

notice of proposed rulemaking. 64 FR

54999–55000 (Oct. 8, 1999). The

response cited Congress’ intention to

impose liability on the operators to the

maximum feasible extent, together with

the provision’s purpose to ensure the

operator’s prompt compliance with its

benefit obligations. The only significant

concern shown by Congress with

respect to the use of section 14(f) was

the caveat that the provision not apply

until the operator ‘‘has the right to

contest the claim.’’ 127 Cong. Rec. 19,

645 (1981). This concern is met by the

requirement that § 14(f) does not apply

until an effective award is in place, and

an effective award arises only after the

operator has had an opportunity for a

hearing. The Department believes

§ 725.502(b) promotes Congress’ overall

objective to shift liability for the

payment of benefits to those operators

who owe the benefits. The significance

of this objective has become more

obvious since the 1981 amendments.

The Fund’s indebtedness to the U.S.

Treasury at the conclusion of fiscal year

1997 was $ 5.487 billion. OWCP Annual

Report to Congress for FY 1997 at 24.

(d) The comment challenges the

allowance of one month of benefits if

the miner dies in the first month during

which all eligibility requirements are

established. The comment contends that

such a payment is not authorized by

statute, and that a duplicate payment

occurs if the miner-claimant dies and

the survivor establishes entitlement

independently because the miner’s

death was due to pneumoconiosis. The

Department rejects this argument as a

reason for eliminating the provision. As

an initial matter, this provision was first

promulgated as part of the original

§ 725.502. See 43 FR 36806 (Aug. 18,

1978). No comments were received then

in response to the regulation, nor did

the Department receive any comments

in response to its initial notice of

proposed rulemaking. See also 20 CFR

410.226(a). In any event, the payment of

benefits twice for the same month of

eligibility in these circumstances is

proper. The program has always paid

benefits for periods during which the

miner established (s)he was totally

disabled by pneumoconiosis arising out

of coal mine employment. 33 U.S.C.

906(a), as incorporated by 30 U.S.C.

932(a), 922(a)(1). Although generally a

miner’s entitlement terminates in the

month before the month of death

(§ 725.203(b)(1)), § 725.502(c) creates an

exception to that rule to recognize the

successful prosecution of a claim, albeit

only for one month of benefits. The

program also pays survivor’s benefits to

eligible recipients if a miner dies due to

pneumoconiosis, 30 U.S.C. 922(a)(2),

and begins such benefit payments with

the month of the miner’s death, 20 CFR

725.212–725.213. The statute does not

prohibit the payment of benefits twice

in one month in the rare event a miner

entitled to benefits for disability dies

due to pneumoconiosis in the first

month of his or her eligibility. No

change in the regulation is necessary.

(e) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 725.503

(a) In its initial notice of proposed

rulemaking, the Department proposed

adding § 725.503(d) to provide specific

guidelines for determining the onset

date for benefits awarded based on a

modification petition. The proposed

rule set forth the date from which

benefits would be payable based either

on a mistake in a determination of fact

or on a change in the miner’s condition.

62 FR 3366, 3412–13 (Jan. 22, 1997). In

the case of a mistaken factual

determination, the proposal employed

the rules used in a miner’s or a

survivor’s claim. If the award was based

on a change in conditions and if the

precise month in which the miner

became disabled could not be

ascertained, the proposed rule pegged

the onset date to the earliest evidence

supporting an element of entitlement

not previously found in the claimant’s

favor, provided the evidence was

developed after the most recent

factfinder’s denial of benefits. The

proposed regulation drew criticism both

for setting the onset date too late and for

setting it too early, thereby allegedly

violating a statutory requirement

prohibiting the payment of benefits

before the onset of the miner’s

entitlement. In the second notice of

proposed rulemaking, the Department

altered § 725.502(d)(2), noting a concern

that the regulation as originally

proposed would generate too much

litigation. 64 FR 55001, 55050 (Oct. 8,

1999). The reproposed version required

the actual onset date of entitlement to be

determined if possible. If that date could

not be ascertained, however,

§ 725.503(d)(2) set a default onset date

using the date the miner filed the

modification petition. The Department

adopted this approach because the filing

date of the application for benefits is the

default onset date for approved miners’

claims (20 CFR 725.503(b)), and that

method had worked well in the

adjudication of black lung claims in

general. The Department therefore

proposed using a similar method in

change in conditions cases. 64 FR 55001

(Oct. 8, 1999). Use of a filing date

reflects ‘‘the logical premise’’ that the

miner would file a claim or a

modification petition when (s)he

believed (s)he is entitled to benefits. In

the final rule, the Department has made

two minor changes to § 725.503(b) and

(c). Each subsection begins with similar

language referring to the entitled

individual to whom benefits are

payable, i.e., the miner entitled to

benefits (subsection (b)), and the

survivor entitled to benefits (subsection

(c)). The purpose of this change is

simply to use parallel language in each

subsection to identify the individual

receiving benefits.

(b) One comment opposes the use of

default onset dates for both claims and

modification petitions. The comment

contends the default date creates a

presumption of entitlement to benefits

as of the filing date when the claimant

has not proven this fact. The commenter

believes such a presumption violates the

Administrative Procedure Act (APA), 5

U.S.C. 556(d), and the Supreme Court’s

decision in Director, OWCP v.

Greenwich Collieries, 512 U.S. 267

(1994). The Department disagrees with

the general proposition that a default

onset date based on a presumption of

entitlement as of a certain date violates

the APA and Greenwich Collieries. The

Department addressed this issue at

length in its second notice of proposed

rulemaking. 64 FR 54972–74 (Oct. 8,

1999). To summarize: the Federal Mine

Safety and Health Act (FMSHA), of

which the Black Lung Benefits Act

(BLBA) is a part, generally is exempt

from the provisions of the APA. 30

U.S.C. 956. The BLBA, however,

incorporates section 19 of the Longshore

and Harbor Workers’ Compensation Act

(LHWCA), 33 U.S.C. 919(d), thereby

making the APA applicable to the

80012 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

adjudication of claims. The

incorporation of the APA (and 5 U.S.C.

556(d) in particular) is subject to one

important constraint: Congress

conferred on the Secretary the authority

to vary the terms of the incorporated

provisions by regulation. 30 U.S.C.

932(a) (provisions of LHWCA apply to

BLBA ‘‘except as otherwise provided

* * * by regulations of the Secretary’’).

See generally Director, OWCP v.

National Mines Corp., 554 F.2d 1267,

1273–74 (4th Cir. 1977); Patton v.

Director, OWCP, 763 F.2d 553, 559–60

(3d Cir. 1985). In Greenwich Collieries,

the issue before the Court concerned the

Department’s authority to displace 5

U.S.C. 556(d) via a regulatory

presumption (20 CFR 718.3) that

required a finding for the claimant if the

evidence for and against a particular

finding was evenly balanced. The Court

considered § 718.3(c) too ambiguous to

vary the APA’s burden of proof

requirements as to the BLBA. It

therefore held that the party who bears

the burden of persuasion under the APA

must prevail by a preponderance of the

evidence. In so holding, the Court also

acknowledged the Department’s

regulatory authority, consistent with the

APA, to utilize presumptions which

ease a party’s burden of production. 512

U.S. at 280–81. The Court did not

address the Department’s argument that

it has the authority to override 5 U.S.C.

556(d) by regulation and shift the

burden of persuasion as well.

Since Greenwich Collieries, three

courts have addressed the Department’s

authority to create presumptions which

alter the parties’ evidentiary burdens.

Although no court has considered the

Department’s statutory authority to shift

a burden of persuasion, all three courts

have approved either directly or in dicta

the Department’s authority to create

presumptions which shift the burden of

production. In Glen Coal Co. v. Seals,

147 F.3d 502 (6th Cir. 1998), the Sixth

Circuit considered whether a judiciallycreated presumption of medical benefits

coverage for the treatment of pulmonary

disorders was consistent with circuit

caselaw. See Doris Coal Co. v. Director,

OWCP, 938 F.2d 492 (4th Cir. 1991)

(holding miner previously found totally

disabled due to pneumoconiosis who

receives treatment for pulmonary

disorder is presumed to receive

treatment for pneumoconiosis for

purposes of medical benefits coverage).

The majority held that the decisions

below erroneously relied on the Doris

Coal opinion when Sixth Circuit law

applied and was inconsistent with

Fourth Circuit precedent. 147 F.3d at

514 (Dowd, D.C.J.), 515 (Boggs, J.). Judge

Boggs (concurring), however, agreed

with Judge Moore (dissenting) ‘‘that it

would not necessarily contravene

Greenwich Collieries for the Secretary to

adopt a regulation shifting the burden of

production in the manner of Doris

Coal.’’ 147 F.3d at 517. In Gulf &

Western Indus. v. Ling, 176 F.3d 226

(4th Cir. 1999), the Fourth Circuit

upheld the validity of the Doris Coal

presumption under the APA as

interpreted by Greenwich Collieries. The

Court agreed with Seals that the

presumption shifts the burden of

production, not persuasion, and

therefore was valid under the APA. 176

F.3d at 233–34. Most recently, the

Eighth Circuit considered whether, for

purposes of a subsequent claim, a

‘‘material change’’ in a miner’s

condition could be presumed if the

miner established one element of

entitlement not previously proven in

connection with a prior denied claim.

Lovilia Coal Co. v. Harvey, 109 F.3d 445

(8th Cir. 1997); see 20 CFR 725.309

(miner must show ‘‘material change in

condition’’ between denial of one claim

and filing of later claim). The Court

rejected the operator’s argument that the

presumption of change violated 5 U.S.C.

556(d) and Greenwich Collieries. In so

doing, the Court cited Greenwich

Collieries’ explicit approval of burden

shifting presumptions which ease a

party’s obligation to produce evidence

in support of its claim. 109 F.3d at 452–

53.

Thus, the courts have upheld the

Department’s authority to shift the

burden of production to the party

opposing entitlement upon a showing of

the predicate facts which support the

presumption without violating the APA.

Section 725.503 does create a

presumption of entitlement to benefits

as of the filing date of the claim absent

contrary evidence. The presumption

rests on a twofold basis: (i) The miner

has established he is entitled to benefits;

and (ii) the Department’s belief that an

individual will file a claim when he

believes himself entitled to benefits. See

43 FR 36828–36829 (Aug. 18, 1978). The

presumption, however, shifts only the

burden of production to the party

opposing benefits. That party may

overcome the presumed entitlement

date by introducing credible medical

evidence that the miner was not

disabled for some period of time after he

filed his claim. See Ling, 176 F.3d at 233

(holding, in context of another black

lung presumption which shifts burden

of production, party must introduce

‘‘credible’’ evidence supporting its

position). ‘‘Credible’’ evidence means

medical opinions which are consistent

with the adjudicator’s findings in the

underlying award of benefits. If the

adjudicator has accepted evidence that

the miner is totally disabled as of a

certain date, then any later medical

opinion contradicting this evidence is

necessarily not credible. Medical

opinions pre-dating the evidence of

entitlement, however, may establish the

miner was not disabled when he filed

his application. See Rochester &

Pittsburgh Coal Co. v. Krecota, 868 F.2d

600, 603 (3d Cir. 1989) (holding ALJ

erroneously awarded benefits from

filing date when evidence proved miner

was not disabled at that time). The

burden of persuasion remains with the

claimant to provide medical evidence

sufficient to overcome the opponent’s.

Similarly, a claimant may also prove he

is entitled to benefits commencing

before he filed his benefits application.

In such a situation, the burden of

persuasion remains, as always, with the

claimant. The comment does not

provide any other rationale for its

position that default onset dates violate

the APA. The Department therefore

declines to abandon its use of such

onset dates when the medical evidence

fails to establish the date on which the

miner became totally disabled due to

pneumoconiosis.

(c) The same comment contends that

using default dates based on filing dates

violates section 6 of the Longshore and

Harbor Workers’ Compensation Act

(LHWCA), 33 U.S.C. 906, as

incorporated by the Black Lung Benefits

Act (BLBA), 30 U.S.C. 932(a). The

comment suggests using as an

alternative default date the date of the

earliest medical evidence the

adjudicator accepts as sufficient to

prove the miner is totally disabled by

pneumoconiosis. The Department

rejects this position. Section 6(a) of the

LHWCA provides in relevant part that

‘‘[n]o compensation shall be allowed for

the first three days of the disability

* * * Provided, however, That in case

the injury results in disability of more

than fourteen days, the compensation

shall be allowed from the date of the

disability.’’ 33 U.S.C. 906(a). As

discussed above, Congress expressly

granted the Secretary the power to tailor

incorporated Longshore Act provisions

to fit the black lung program: the

LHWCA sections apply to the BLBA

‘‘except as otherwise provided * * * by

regulations of the Secretary.’’ 30 U.S.C.

932(a); Director, OWCP v. National

Mines Corp., 554 F.2d 1267, 1273–1274

(4th Cir. 1977).

In 1978, the Secretary promulgated 20

CFR 725.503 to implement section 6(a).

43 FR 36806 (Aug. 18, 1978). Like the

revised § 725.503, the 1978 regulation

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80013

prescribed two alternative means for

determining the entitlement date. The

adjudicator had to first consider

whether the evidence established the

month during which the miner became

totally disabled due to pneumoconiosis.

If the evidence was insufficient to

identify the specific month, the

adjudicator resorted to the default date:

the month in which the miner filed his

or her claim. Section 725.503(d)(2)

adopts the same general approach for

modification petitions, and substitutes

the month the claimant filed the

modification petition as the default date

if the award is premised on a change in

the miner’s condition. 64 FR 55050 (Oct.

8, 1999). In the comments

accompanying the promulgation of 20

CFR 727.302, the Secretary explained

the reasoning behind the adoption of a

default entitlement date:

This approach was adopted in view of the

great difficulty encountered in establishing a

date certain on which pneumoconiosis, often

a latent, progressive, and insidious disease,

progressed to total disability. The filing date

was thought to be fair since proof of onset,

which was usually obtained after filing,

would likely fix the date of total disability at

the time at which the medical tests were

administered. The filing date, on the other

hand, was likely to be a more accurate

measure of onset since it would be the date,

or close to the date, on which the claimant

felt the need to file for benefits, presumably

because disability had become total.

43 FR 36828–36829 (August 18, 1978).

The Secretary also emphasized that ‘‘a

reasonable effort will always be made to

establish the month of onset.’’ 43 FR

36806 (August 18, 1978).

Section 725.503 therefore deals with

the difficulties inherent in identifying

the particular month a miner’s lung

condition deteriorated to the point he

became totally disabled due to

pneumoconiosis. As noted above, the

Department has long since concluded

that pneumoconiosis is a latent and

progressive disease which may manifest

itself pathologically over a lengthy

period of time. See generally § 718.201,

responses to comments. As a result,

detecting the precise month when the

deterioration reached the level of

compensable disability is problematic at

best. In addition, clinical evidence of

disability on a particular date does not

mean the miner became disabled that

day. The test may simply detect a

condition which developed sometime

earlier. Green v. Director, OWCP, 790

F.2d 1118, 1119 n.4 (4th Cir. 1986).

Notwithstanding these difficulties,

however, an award of benefits must set

a date from which those benefits are

payable. 20 CFR 725.503(f); 64 FR 55050

(Oct. 8, 1999). If the medical evidence

in a particular case pinpoints the

disability date, that date must be used.

In many cases, the evidence is

inconclusive or contradictory over time.

Even if the earliest positive evidence

establishes the miner’s entitlement, that

evidence only proves the miner was

disabled on that date. Such evidence is

entirely consistent with a compensable

disability antedating the medical testing

for some unknown period of time. See

Green, 790 F.2d at 1119 n. 4.

Consequently, the Department has

consistently found a default entitlement

date necessary, as a rule of

administrative convenience, in order to

implement the black lung program in an

effective manner. See generally 30

U.S.C. 936(a) (authorizing Secretary to

‘‘issue such regulations as [she] deems

necessary to carry out the provisions of’’

title IV). The choice of the filing date

reflects the rational assumption that

claimants, by and large, file claims or

modification petitions when they

believe themselves entitled to benefits

(although compensable disability may

in fact have occurred either prior to, or

after, the application date). The

Department recognizes claimants may

file modification petitions for other

reasons as well, e.g., the claimant may

secure the services of an attorney, obtain

new medical evidence, or intend to

prevent the underlying claim from

becoming finally denied. These reasons

do not detract from the underlying logic

of the default onset date; rather, they

simply explain why a claimant takes a

particular action at a particular time.

The natural impetus to pursue benefits

at all is the individual’s belief that (s)he

is entitled to them. Like the default

onset date for claims, the same

explanation supports a similar approach

for awards obtained on modification if

the miner’s condition has changed to

the point of compensable disability and

the actual onset date cannot be

ascertained.

The Department believes the filing

date strikes a reasonable balance

between overcompensating and

undercompensating the miner. Section

6(a) requires the liable party to pay

benefits ‘‘from the date of the

disability.’’ 33 U.S.C. 906(a), as

incorporated. If the medical evidence

does not identify that date, the miner

might receive either more, or less,

compensation than the amount to which

(s)he is entitled by using the filing date.

Obviously, if the medical evidence

proves that the miner became disabled

only after he filed, then the filing date

is inapplicable; the adjudicator must

select some later date to avoid

compensating the miner for a period of

time when (s)he was not eligible. See

Rochester & Pittsburgh Coal Co. v.

Krecota, 868 F.2d 600, 603 (3d Cir.

1989) (holding that ALJ erroneously

relied on filing date when medical

evidence clearly indicated miner was

not disabled until several years later).

Absent such evidence, however, the

rationale underlying section 725.503

ensures the miner will receive the

approximately correct amount of

compensation. Accordingly, the

Department rejects the comment’s

position that a default onset date based

on a filing date—of either a claim or a

modification petition—violates section

6(a).

The same comment also states that the

use of default onset dates originated

under part B of the BLBA and derives

from the Social Security Act. The

commenter contends that section 6(a)

supersedes the Social Security Act rule

for purposes of part C of the BLBA. As

discussed above, default onset dates are

entirely consistent with section 6(a).

Furthermore, the comment does not

explain why their origin has any legal

relevance. The comment does not state

a basis for eliminating default onset

dates for part C claims.

(d) One comment opposes using the

date the claimant petitioned for

modification as the default onset date if

benefits are awarded based on a change

in the miner’s condition. The

commenter contends the proper default

date should be immediately after the

date of the adverse decision which was

overturned on modification. For the

reasons set out in comment (c), the

Department rejects this suggestion. The

filing date is the most rational point to

begin benefits if the date on which the

miner’s pulmonary condition changed

sufficiently to make him or her entitled

to benefits is not established by the

evidence of record. If, however, the

record contains credible evidence of the

miner’s entitlement predating the

modification petition, the onset date

should be the date of that evidence

provided no later credible evidence

refuting entitlement exists, and the

evidence was developed after the date

on which the most recent denial by a

district director or administrative law

judge became effective.

(e) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.515

(a) The Department did not open

§ 725.515 for comment when it issued

the initial notice of proposed

rulemaking, 62 FR 3341 (Jan. 22, 1997).

The Department proposed amending

§ 725.515 in its second notice of

80014 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

proposed rulemaking to conform it to

changes in federal law which make

black lung benefits payable by the Black

Lung Disability Trust Fund subject to

garnishment for child support and

alimony. 64 FR 54971, 55001 (Oct. 8,

1999).

(b) Although one comment has

suggested the Department allow

claimants and responsible operators to

negotiate settlements rather than fully

litigate every claim, the Department

opposes this suggestion. The

Department’s principal response to the

issue of settlements appears in the Final

Regulatory Flexibility Analysis, below.

The Department takes the same position

with respect to any assignment, release

or commutation of benefits except to the

extent authorized by the Black Lung

Benefits Act (BLBA) or the Secretary’s

regulation. Such agreements are void.

Norfolk Shipbuilding & Drydock Corp.

v. Nance, 858 F.2d 182, 186 (4th Cir.

1988), cert. den. 492 U.S. 911 (1989).

The BLBA prescribes precisely the

amount of monthly benefits to which a

claimant is entitled. 30 U.S.C. 922(a).

This statutory compensation schedule

represents Congress’ judgment as to the

reasonable level of monthly benefits a

totally disabled miner or his or her

survivor should receive. By

incorporating section 16 regarding

releases (and 15 regarding waiver, see

Brown v. Forest Oil Corp., 29 F.3d 966,

968 (5th Cir. 1994)) of the Longshore

and Harbor Workers’ Compensation Act

(LHWCA), 33 U.S.C. 916, 915, into the

BLBA, 30 U.S.C. 932(a), Congress

demonstrated its intent to ensure that

claimants receive the full amount of

benefits to which they become entitled,

thereby having less need to resort to

other means of support, including

public assistance. See generally 1

Larson’s Workers’ Compensation Law

(MB) § 1.03[2] (1999). Moreover, making

agreements to reduce, divert or bargain

away benefits absolutely void also

provides some level of protection to

claimants’ rights; no party who

negotiates such an agreement can rely

on its terms in the event the claimant

elects to pursue his or her full rights

under a claim. Such protections are

especially appropriate given the

claimant population most affected by

the BLBA, i.e., elderly, disabled and less

educated retired workers and their

survivors. Prohibiting settlements also

recognizes the progressive nature of

pneumoconiosis. Because this disease

may evolve over a period of years, the

availability of settlements may

encourage a miner-claimant to forego a

future claim for full benefits after the

pneumoconiosis has progressed to the

point of compensable disability in lieu

of the present payment of a lesser

amount. The Department therefore

considers settlements ill-suited to the

BLBA program. Finally, although it

incorporated sections 16 and 15 of the

LHWCA into the BLBA, Congress did

not incorporate section 8 (allowing for

district director approval of certain

settlements under the LHWCA). The

Department does not believe Congress

meant to allow settlements to occur

under the BLBA in the absence of an

express and direct incorporation of such

intent.

(c) No comments were received

concerning this section, and no further

changes have been made in it.

20 CFR 725.522

In its initial notice of proposed

rulemaking, the Department proposed a

shortened § 725.522, in which

subsections (a) and (b) of 20 CFR

725.522 were combined in proposed

§ 725.522(a). Discussion of when benefit

payments are due was moved to a newly

expanded § 725.502. These proposed

changes were part of a general rewriting

of the regulations governing the

payment of benefits, Part 725, Subpart

H. 62 FR 3365–67 (Jan. 22, 1997).

Although no comments were received

concerning this section, the Department

reiterates that the cost of a miner’s

complete pulmonary examination at

Trust Fund expense—defined as a

‘‘benefit’’ under § 725.101(a)(6)—is not a

payment included within

‘‘overpayments’’ for purposes of

subsection (b). See 62 FR 3351 (Jan. 22,

1997); 64 FR 54982 (Oct. 8, 1999). No

changes have been made in this section.

20 CFR 725.530

(a) In its initial notice of proposed

rulemaking, the Department proposed a

new § 725.530(a), setting out an

operator’s or carrier’s obligation to pay

benefits immediately when they become

due pursuant to an effective order, and

the consequences of an operator’s

failure to pay such benefits. 62 FR

3415–16 (Jan. 22, 1997). This proposed

change was part of a general rewriting

of the regulations governing the

payment of benefits, Part 725, Subpart

H. 62 FR 3365–67 (Jan. 22, 1997).

(b) Two comments object generally to

the imposition of a ‘‘penalty’’ for an

operator’s failure to pay benefits when

due, citing comments addressed to

§ 725.502. For the reasons expressed in

the response to those comments, no

changes are made to either regulation.

(c)(i) Several comments object to the

imposition of a ‘‘penalty’’ for failure to

pay a benefit within ten days after the

payment is due, arguing that ten days is

not enough time to calculate correct

benefit amounts under the Black Lung

Benefits Act (BLBA). The Department

disagrees. This regulation does not

change existing law in any material

manner. The BLBA incorporates § 14 of

the Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 914,

which governs the payment of

compensation under that Act. 30 U.S.C.

932(a). Section 14(f) provides that

additional compensation, in the amount

of twenty percent of unpaid benefits,

shall be paid if an employer fails to pay

within ten days after the benefits

become due. The twenty-percent

additional compensation provision has

been an incorporated provision of Part

C since the inception of the statute.

Consequently, § 725.530 merely restates

existing law: failure to pay the full

amount of benefits owed the claimant

within ten days after the benefits are

due shall result in the payment of an

additional twenty percent of the unpaid

benefits. See also § 725.607(a) (twentypercent additional compensation

assessed on unpaid benefits); Sproull v.

Director, OWCP, 86 F.3d 895, 900–01

(9th Cir. 1996), cert. den. sub nom.

Stevedoring Services of America, Inc. v.

Director, OWCP, 117 S.Ct. 1333 (1997)

(holding twenty percent additional

compensation applies to late payment of

interest notwithstanding employer

timely paid underlying benefits) This

assessment is self-executing, and

attaches automatically upon the failure

to make timely payment regardless of

any equitable considerations explaining

the untimeliness. Severin v. Exxon

Corp., 910 F.2d 286, 288 (5th Cir. 1990).

The Department also notes that monthly

benefit amounts are fixed by law and

adjusted only once a year. Most black

lung benefits are paid by insurance

companies or self-insured coal

companies who have ready access to

current monthly benefits rates and the

expertise to make any necessary

computations. Finally, the Department

notes that the actual amount of time

available to the party liable for benefits

to make a timely payment has been

enlarged by virtue of changes made in

§ 725.502(b). That regulation requires

the liable party to pay the benefits due,

pursuant to an effective order, for any

given month by the fifteenth day of the

following month. 64 FR 55050 (Oct. 8,

1999). Liability for additional

compensation in the amount of twentypercent for defaulting on a payment

cannot be invoked until an additional

ten calendar days have passed after the

monthly benefit becomes due. See

Pleasant-El v. Oil Recovery Co., Inc., 148

F.3d 1300, 1303 (11th Cir. 1998); Burgo

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80015

v. General Dynamics Corp., 122 F.3d

140, 143 (2nd Cir. 1997) cert. den. 118

S.Ct. 1839 (1998); Reid v. Universal

Maritime Serv. Corp., 41 F.3d 200, 202

(4th Cir. 1994); Irwin v. Navy Resale

Exchange, 29 Ben. Rev. Bd. Serv. 77

(1995); contra Quave v. Progress Marine,

912 F.2d 798, 800 (5th Cir. 1990)

(holding ten days means ten business

days). With respect to the initial

payment after entry of an award, the

responsible operator should always

have at least 25 days (as shown by the

following example) in which to make

the computation and make the first

payment of monthly benefits. If an

award becomes effective on the last day

of January, the operator has until

February 15th in which to pay the

benefits attributable to January; the

operator also has an additional ten days

to avoid liability for additional

compensation. This amount of time

should be sufficient to allow the

calculation of the benefit amount due

and pay the claimant, and therefore to

comply fully with the regulatory

deadlines. This minimum period of 25

days comes close to the 30 day-period

suggested by one comment as ‘‘more

reasonable.’’ In fact, in cases in which

the order awarding benefits becomes

effective at the beginning of the month,

the operator will have far more than the

suggested 30 days in which to issue the

check. As for payments subsequent to

the initial payment, the operator has

ample time to calculate and issue the

monthly benefits check before incurring

the assessment of additional

compensation for untimeliness.

Continuing with the previous example:

If the operator has made the initial

payment on February 15th, the next

installment is not due until March 15th;

the operator then has an additional ten

days until the § 14(f) assessment

attaches in which to make the payment.

(ii) The more complex computations

involve retroactive benefits. Under

§ 725.502(b)(2), an operator need not

pay retroactive benefits until the district

director computes this amount, within

30 days after issuance of an effective

award, and informs the responsible

operator of it. Benefits and interest for

periods prior to the effective date of the

order are not due until the thirtieth day

following issuance of the district

director’s computation. This time is

sufficient to verify the district director’s

computation, and actually allows the

employer considerably more time than

the ten days provided by 20 CFR

725.607(a) in which to pay retroactive

benefits before liability for twentypercent additional compensation may

be imposed.

(c) One comment contends the

proposed changes depart from current

departmental practice and penalize

operators for appealing awards of

benefits. The Department disagrees.

Section 14(f), as noted above, is an

incorporated statutory provision which

has been a part of part C of the BLBA

from the beginning. Its incorporation

represents a policy determination by

Congress to promote the prompt

compliance of a responsible operator

with the terms of an effective award.

The proposed changes to the regulations

do not vary the operation of section

14(f). Rather, they simply implement

Congress’ intent in placing section 14(f)

into the BLBA. Whether current

administrative practice does not apply

section 14(f) to the maximum extent

cannot change the plain meaning of the

provision. Finally, imposition of

additional compensation for failing to

pay benefits in a timely manner is not

a penalty for pursuing an appeal of an

award. Section 14(f) is a tool for

ensuring compliance with an operator’s

benefits obligations once an effective

award is in place and regardless of what

subsequent litigation strategy the

operator chooses to pursue.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.533

The Department did not open

§ 725.533 for comment when it issued

the initial notice of proposed

rulemaking, 62 FR 3341 (Jan. 22, 1997).

When the Department issued its second

notice of proposed rulemaking, it

proposed minor changes in the

regulation and invited comments from

the public. 64 FR 54971, 55001–02 (Oct.

8, 1999). Specifically, the Department

proposed deleting provisions

concerning section 415 ‘‘transition’’

claims, 30 U.S.C. 925, in both the

current 20 CFR 725.403 and 725.533.

Although the Department does not

intend to alter the rules applicable to

any section 415 claim that may remain

in litigation, parties have adequate

access to these rules in earlier editions

of the Code of Federal Regulations. In

the final rule, the Department has added

a comma after the word

‘‘circumstances’’ in the first sentence of

subsection (a) for grammatical purposes.

No comments were received concerning

this section, and no other changes have

been made in it.

20 CFR 725.537

(a) The Department proposed

changing § 725.537 in the initial notice

of proposed rulemaking to harmonize

the regulation with proposed

§ 725.212(b), which requires full

benefits to be paid to each surviving

spouse of a deceased miner if more than

one eligible survivor exists. 62 FR 3366,

3417 (Jan. 22, 1997).

(b) Two comments state that the

Department cannot retroactively apply

the regulation permitting more than one

surviving spouse of a deceased miner to

receive monthly benefits as a

beneficiary without regard to the

existence of any other entitled spouse

(see § 725.212(b)). The comments

contain no citation to specific precedent

and no further explanation. They do not

afford the Department a sufficient basis

for any change to the regulation. The

Department has also addressed

comments concerning the retroactive

effect of the regulations in connection

with § 725.2, and see 64 FR 54981–82

(Oct. 8, 1999).

(c) One comment contends the change

permitting full benefits to multiple

survivors is grounded on a false

premise. The commenter states that the

Social Security Administration (SSA)

did not grant full benefits to multiple

surviving spouses under part B of the

Black Lung Benefits Act (BLBA), and

‘‘required’’ the Department to use the

same rules. The comment does not

provide any basis for either proposition.

The Department rejects the comment for

several reasons. First, the commenter

cites no statutory authority, SSA

regulation, or other evidence for its

description of SSA practice, and thus no

conclusions can be drawn about that

agency’s official practice concerning the

issue. Second, SSA administered Part B

of the BLBA, but the Department has

had sole authority over Part C since

January 1, 1974. Whatever SSA’s

internal views or practice, it cannot

bind the Department if the Department

concludes the statute requires a

different result. Third, the Department

believes the law compels what the

revised regulation provides. In the

initial notice of proposed rulemaking,

the Department provided a detailed

legal analysis of the pertinent statutory

authorities and legislative history, all of

which support awarding full monthly

benefits to more than one surviving

spouse. See 62 FR 3350–51 (Jan. 22,

1997). Congress amended the Social

Security Act in 1965 to allow benefits to

a divorced surviving spouse as a

‘‘widow’’ of the miner. Pub. L. No. 89–

97, section 308(b)(1), 79 Stat. 286

(1965). The legislative history of the

amendment clearly established

Congress’ intent that payment of

benefits to two (or more) ‘‘widows’’

would not reduce the benefits paid to

either. S. Rep. No. 404, 89th Cong., 1st

Sess. (1965), reprinted in 1965 U.S.C.C.

80016 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

& A.N. 1943, 2047. In 1972, Congress

amended the BLBA definition of

‘‘widow’’ to use the Social Security Act

definition. 30 U.S.C. 902(e). The

legislative history is equally clear that

Congress intended to conform the BLBA

definition to the Social Security Act

definition. S. Rep. No. 743, 92nd Cong.,

2d. Sess., reprinted in 1972 U.S.C.C. &

A.N. 2305, 2332. The BLBA also

reinforces this interpretation because it

requires a ‘‘widow’’ to receive benefits

at prescribed rates and makes no

allowance for a reduction based on the

existence of more than one widow. 30

U.S.C. 922(a)(2). To date, two courts of

appeals and the Benefits Review Board

have accepted the Department’s

position. Peabody Coal Co. v. Director,

OWCP [Ricker], 182 F.3d 637, 642 (8th

Cir. 1999); Mays et al. v. Piney

Mountain Coal Co., 21 Black Lung Rep.

1–59, 1–65/1–66 (1997), aff’d 176 F.3d

753, 764–765 (4th Cir. 1999). No court

has reached a contrary result, and no

comment has addressed the substance of

this analysis. Consequently, the

Department has no basis for changing

the regulation.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.543

(a) The Department did not open

§ 725.543 for comment when it issued

the initial notice of proposed

rulemaking, 62 FR 3341 (Jan. 22, 1997).

The Department received a number of

comments, however, offering general

criticisms of the overpayment waiver

and adjustment criteria; the program

had been using criteria developed by the

Social Security Administration (SSA)

for waiver of overpayments incurred

under Part B of the Black Lung Benefits

Act (BLBA). In response, the

Department proposed revising § 725.543

to adopt the waiver standards in 20 CFR

part 404, which are used by the SSA in

administering title II of the Social

Security Act. 64 FR 55055 (Oct. 8,

1999). The Department explained that

the part 404 criteria better reflect the

current law than the part 410 criteria

because the part 410 have not been

revised since 1972. 64 FR 55002 (Oct. 8,

1999).

(b) One comment generally opposes

the extension of the overpayment

waiver and recovery procedures to

claims involving responsible operators,

and incorporates by reference its

response to § 725.547. The comment

does not specifically address the

substance of proposed § 725.543. The

Department responds to comments

concerning § 725.547 at that provision.

(c) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.544

(a) The Department did not open

§ 725.544 for comment when it issued

the initial notice of proposed

rulemaking, 62 FR 3341 (Jan. 22, 1997).

The Department did receive one

comment which noted that the

maximum amount subject to

compromise had been raised to

$100,000. 64 FR 55002 (Oct. 8, 1999).

The Department proposed changing

§ 725.544 to reflect that fact, and to

replace the reference to the Federal

Claims Collection Act of 1966, now

repealed, with a citation to 31 U.S.C.

3711. 64 FR 55055–56 (Oct. 8, 1999).

(b) One comment opposes in general

terms the extension of the overpayment

waiver and recovery procedures to

claims involving responsible operators,

and incorporates by reference its

response to § 725.547. The comment

does not specifically address the

substance of proposed § 725.544. In any

event, this provision only applies to the

compromise of debts owed the United

States government. See 31 U.S.C.

3711(a).

(c) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.547

(a) In the initial notice of proposed

rulemaking, the Department proposed

amending § 724.547 to extend the

waiver and adjustment provisions to

overpayments owed by claimants to

responsible operators. 62 FR 3366, 3419

(Jan. 22, 1997). Formerly, these

protections had applied only to

claimants who had been overpaid by the

Trust Fund. 20 CFR § 725.547(a). The

Department concluded that the

opportunity to obtain a waiver or

adjustment of the debt should be made

available to all claimants regardless of

their benefits’ source. The Department

received numerous comments opposing

the proposed change for a variety of

reasons. 64 FR 55002–03 (Oct. 8, 1999).

Comments urging the Department to

limit recoveries to the adjustment of

future benefits, and objections based on

increased difficulties for operators in

recovering overpayments, were rejected

based on the policy considerations set

forth in the initial notice of proposed

rulemaking. 62 FR 3366–67 (Jan. 22,

1997). The Department also rejected the

position that waiver of an overpayment

owed an operator amounted to the

unconstitutional deprivation of

property, citing caselaw upholding

overpayment recoveries under the more

restrictive Longshore and Harbor

Workers’ Compensation Act (LHWCA),

33 U.S.C. 914(j), 922, as incorporated by

30 U.S.C. § 932(a). Finally, the

Department addressed comments urging

changes in the legal test for waiver by

noting that the test is derived from an

incorporated provision of the Social

Security Act (SSA). The Department

did, however, propose changes to

§ 725.543, adopting more current

criteria for waiver. See 64 FR 55055

(Oct. 8, 1999).

(b) Two comments oppose the

Department’s use of the SSA waiver

provisions rather than the LHWCA

approach to the problem. The Black

Lung Benefits Act (BLBA) incorporates

the overpayment provisions of both

statutes. 42 U.S.C. 404(b), as

incorporated by 30 U.S.C. 923(b), 940

(SSA); 33 U.S.C. 914(j), 922, as

incorporated by 30 U.S.C. 932(a)

(LHWCA). The SSA requires the agency

to obtain reimbursement of overpaid

benefits unless the claimant can prove

recovery would either deprive him of

the financial resources to pay for

necessary expenses, or violate equity

and good conscience regardless of his

financial condition. The LHWCA,

however, limits recovery to the

adjustment of future benefits; if no

benefits will be paid, no overpayment

can be recovered. In the initial notice of

proposed rulemaking, the Department

reviewed the reasons for using the SSA

provisions: judicial precedent

upholding the Department’s authority to

recover overpayments under the SSA

scheme; adverse financial consequences

for the Fund if the Department used the

more restrictive Longshore provisions;

and the protections afforded claimants

by the waiver procedure, which limits

recovery to those individuals who can

afford to reimburse the overpaid

benefits. 62 FR 3366–67 (Jan. 22, 1997).

In the second notice of proposed

rulemaking, the Department

acknowledged the comments advocating

use of the LHWCA model but relied on

the policy considerations previously

advanced. 64 FR 55002 (Oct. 8, 1999).

The Department continues to believe

that these considerations provide valid

reasons for using the SSA provisions as

the basis for the Department’s

overpayment recovery procedures.

Moreover, adopting the more current

overpayment criteria in 20 CFR part 404

will conform the Department’s practice

to changes in the law since 1972. See 64

FR 55055 (Oct. 8, 1999). The

Department therefore disagrees with the

commenters who urge that the SSA

overpayment procedures be abandoned

in favor of the LHWCA model.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80017

(c) One comment states that the

Department’s response to comments in

the second notice of proposed

rulemaking, 64 FR 55002–03 (Oct. 8,

1999), failed to answer several concerns

raised in the initial round of comments.

Specifically, the original comment

contended that: the LHWCA provisions

supersede the SSA provisions with

respect to part C claims, citing Bracher

v. Director, OWCP, 14 F.3d 1157 (7th

Cir. 1994); the Department must

evaluate the cost of recovering

overpayments against the amounts

actually recovered; caselaw on waiver

issues contradicts the Department’s

view that the standards will protect

claimants from burdensome recoveries;

and courts apply inconsistent

interpretations of the waiver standards.

None of the commenter’s arguments

warrant changing the basic overpayment

recovery procedures. (i) The Seventh

Circuit Court of Appeals’ decision in

Bracher does not support the

commenter’s position. The Court

actually declined to address the

relationship between the SSA and

LHWCA overpayment provisions

because the petitioner failed to make the

argument in earlier proceedings. 14 F.3d

at 1161. The Court also noted, in

passing, that the Department has the

explicit statutory authority in 30 U.S.C.

932(a) to modify incorporated LHWCA

provisions by issuing regulations which

vary the terms of those provisions. (ii)

With respect to the costs involved in

undertaking overpayment proceedings,

this factor may be considered in

determining whether to pursue

individual cases. Cost alone is not a

reason to ignore the duty to recover

overpayments imposed by the BLBA.

(iii) The Department disagrees that the

cases cited by the commenter

demonstrate that the waiver and

recovery procedures provide inadequate

protection of claimants’ interests. The

comment incorrectly states that the

Seventh Circuit upheld a $47 difference

between a claimant’s monthly income

and expenses as a sufficient cushion to

allow repayment of an overpayment.

Benedict v. Director, OWCP, 29 F.3d

1140 (7th Cir. 1994). The Court actually

found that the claimant’s monthly

income exceeded his expenses by at

least $110 (not including interest

income), and that the available financial

assets would enable the claimant to

repay the overpayment without adverse

effect on his living standard. The

comment also cites Bracher, 14 F.3d

1157, as another example of the lack of

protection afforded claimants by the

waiver procedures. In that decision, the

Seventh Circuit held an individual

cannot claim reliance on ‘‘erroneous

information’’ from the agency as a basis

for waiver if the ‘‘information’’ is a

district director’s award which is later

overturned. The Court correctly noted

that characterizing such awards as

erroneous agency information would

result in waiver for virtually any

overturned award, and render

meaningless a regulatory provision

which makes interim awards

‘‘overpayments.’’ 14 F.3d at 1162. See

also McConnell v. Director, OWCP, 993

F.2d 1454, 1458 (10th Cir. 1993); Weis

v. Director, OWCP, 16 Black Lung Rep.

1–56, 1–58 (1990). The comment does

not explain in what manner Bracher

proves the Department has exaggerated

the extent to which the waiver and

recovery regulations protect claimants’

interests. (iv) Finally, the commenter

contends that the circuits have reached

inconsistent results in determining

whether to waive recovery of

overpayments, citing Benedict, 29 F.3d

1140, and McConnell, 993 F.2d 1454.

Specifically, the comment expresses

concern that one court granted a waiver

for the claimant because he spent the

benefits on a vacation while another

court denied waiver to a claimant who

saved the benefits. The results reached

in these cases are not inconsistent. In

McConnell, the Court granted the waiver

because the miner relied on the receipt

of the benefits to pay for the vacation;

his detrimental reliance could be

directly linked to the benefits because

he would not have taken the vacation

without the additional money. The

Court concluded that permitting the

Department to recoup the amount of

benefits spent on the vacation would

violate ‘‘equity and conscience.’’ 993

F.2d at 1461. With respect to the

balance of the overpayment, the Court

held that the miner had the financial

capacity to repay the benefits because

he had a $114 monthly cushion after

comparing his income and expenses.

993 F.2d at 1160. Similarly, in Benedict,

the Court considered a $110 monthly

cushion sufficient. The Court rejected

the argument that recovery would

violate ‘‘equity and good conscience’’

because the miner did not relinquish

any right or, unlike McConnell,

undertake an expense because of the

availability of the benefits. The

Department therefore rejects the

comment’s interpretation of these

decisions.

(d) One comment focuses on the

differences between the LHWCA and

BLBA programs as a basis for

distinguishing caselaw under the

LHWCA holding that limitations on

overpayment recovery do not deprive

employers of property rights. The

comment stresses that LHWCA

claimants generally suffer job-related

traumatic injuries which are promptly

known by the employer, and the claims

litigation is resolved quickly. By

contrast, the commenter notes that

BLBA claimants generally file after

retirement and the entitlement litigation

is lengthy because the issues are

contentious; the protracted litigation

therefore causes delays and

correspondingly larger overpayments

since operators must pay benefits during

the litigation. Based on these contrasts,

the comment argues that the limitations

imposed on the operator’s right to

recover overpayments by § 725.547

should be abandoned because the

operator has no effective means of

defending its interests. In effect, the

commenter argues that the inherent

delays in BLBA claims adjudication

raise due process concerns because the

delays generate large overpayments

which will be uncollectible under

§ 725.547.

The comment rests on the premise

that inherent delays exist in the

adjudication of black lung claims, and

that the delays amount to per se denial

of due process. Delay alone, however, is

not a due process violation. C & K Coal

Co. v. Taylor, 165 F.3d 254, 259 (3d Cir.

1999). ‘‘It is not the mere fact of the

government’s delay that violates due

process, but rather the prejudice from

such delay.’’ Consolidation Coal Co. v.

Borda, 171 F.3d 175, 183 (4th Cir. 1999).

In the context of black lung entitlement

litigation, delays have prompted courts

to transfer liability from operators to the

Black Lung Disability Trust Fund

because agency errors have deprived the

operators of the ability to defend

themselves in a meaningful manner as

required by due process. Island Creek

Coal Co. v. Holdman, 202 F.3d 873,

883–84 (6th Cir. 2000); Borda, 171 F.3d

at 183–84; Lane Hollow Coal Co. v.

Director, OWCP [Lockhart], 137 F.3d

799, 808 (4th Cir. 1998). In each of those

cases, unwarranted delays by the agency

precluded the operators from asserting

defenses to liability; in effect, the

claimant won by default. Accordingly,

delay at some point in the opportunity

for adjudication of a case may constitute

a denial of due process, but a mere

allegation of delay without any

explanation why the delay is

unreasonable does not substantiate a

due process violation. Abbott v.

Louisiana Ins. Guaranty Assoc., 889

F.2d 626, 632–33 (5th Cir. 1989), citing

Cleveland Bd. of Education v.

Loudermill, 470 U.S. 532, 547 (1985).

The commenter implies that the

prejudice which establishes the denial

80018 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

of due process is the unrecoverable

overpayments generated by the timeconsuming litigation over entitlement.

The possibility exists that some claims

will be approved and require years of

litigation before final denial, thereby

generating large overpayments that may

be waived in overpayment proceedings

under § 725.547. Such a possibility,

however, does not establish a general

violation of due process. First, the

Department is not solely responsible for

the delays in black lung benefits

litigation, and the caselaw is clear that

only prejudicial delays caused by the

government are the basis for due process

concerns. Second, the prejudicial effect

of delay must be considered in the

factual context of actual cases, and not

simply in the abstract. Third, the

existence of large overpayments is not

necessarily evidence of due process

violations. If the underlying entitlement

adjudication process works in a fair

manner, then due process has been

provided and the size of the resulting

overpayment is irrelevant. ‘‘The Due

Process Clause does not create a right to

win litigation; it creates a right not to

lose without a fair opportunity to

defend oneself.’’ Lane Hollow Coal Co.,

137 F.3d at 807 (emphasis in original).

Finally, the fact that large overpayments

may eventually be waived does not

necessarily amount to a due process

violation. Section 725.547 provides

operators with the opportunity to

recover overpayments through an

adjudicatory scheme similar to the

entitlement process, with rights to

evidentiary development, hearing and

appeal. The comment does not explain

why elimination of the waiver process

will enhance the operators’ ability to

recover overpayments. The comment

does not state a sufficient basis for

abandoning the regulation.

(e) One comment supports § 725.547.

(f) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.548

(a) Formerly, in any case involving an

underpayment or an overpayment,

§ 725.547(c) and (d) empowered district

directors to issue orders protecting the

parties’ interests and to resolve disputes

over the orders using the procedures

applicable to entitlement issues. 20 CFR

725.547. Based on its title,

‘‘Applicability of overpayment and

underpayment provisions to operator or

carrier,’’ section 725.547 applied only to

cases involving responsible operators.

The Department intends that these

provisions should apply to overpayment

and underpayment cases involving both

responsible operators and the Black

Lung Disability Trust Fund.

Accordingly, the Department proposed

§ 725.548 in the second notice of

proposed rulemaking as a regulation of

general applicability, and moved

§ 725.547(c) and (d) to the proposed

regulation. 64 FR 55003, 55056–57 (Oct.

8, 1999).

(b) No comments were received

concerning this section, and no changes

have been made in it.

Subpart I

20 CFR 725.606

(a) In its initial notice of proposed

rulemaking, the Department proposed

revising § 725.606 in order to require

that uninsured operators, including coal

mine construction and coal

transportation employers, secure the

payment of benefits in individual claims

that have been awarded and for which

they have been determined liable. 62 FR

3367 (Jan. 22, 1997). The regulation

establishes a procedure under which

such an operator may be compelled to

post the necessary security in the

absence of evidence demonstrating that

the operator has taken other action to

secure the benefit payments. In

addition, the regulation distinguishes

between operators who were required

to, but did not, comply with the security

requirement in 30 U.S.C. 933, and coal

mine construction and coal

transportation employers, who are not

required to comply with that

requirement. An uninsured employer

that failed to comply with 30 U.S.C. 933

is required to post security worth no

less than $175,000, while an uninsured

employer that is either a coal mine

construction or transportation employer

is entitled to an individualized

assessment of the amount of security

required based on actuarial projections.

That company also must secure the

payment of all future benefits, however.

The Department corrected a

typographical error in subsection (c) in

its second notice of proposed

rulemaking, and responded to a

comment regarding coal mine

construction employers. The commenter

argued that the proposal inappropriately

imposed personal liability on the

corporate officers of a coal mine

construction employer that fails to

comply with the post-award security

requirement, and further stated that the

proposal was unnecessary with respect

to coal mine construction employers,

who comply with their obligations to

pay benefits. The Department responded

by demonstrating the legal basis for its

imposition of personal liability on the

officers of corporate coal mine

construction employers. The

Department also observed that,

notwithstanding compliance by coal

mine construction employers, there was

no basis for excluding construction

companies from the requirements

imposed by the Black Lung Benefits Act.

64 FR 55003 (Oct. 8, 1999).

(b) One comment continues to

disagree with the requirement that coal

mine construction employers secure the

payment of awarded claims, arguing

that the Department’s experience with

construction employers has been

satisfactory. In its second notice of

proposed rulemaking, the Department

discussed a similar comment at length.

64 FR 55003 (Oct. 8, 1999). The

Department did not dispute the

observation that coal mine construction

employers generally complied with

their obligations to pay awarded claims.

The Department explained, however,

that the proposed revision to § 725.606

represented the Department’s attempt to

fulfill its responsibility to identify all

parties’ obligations under the Black

Lung Benefits Act. The Department also

noted that proposed § 725.606

represented an efficient means of

enforcing the obligations of all parties.

The commenter now states that the

proposal would impose an onerous and

punitive burden on coal mine

construction employers. The

Department disagrees. The regulation

does not require an uninsured employer

to deposit funds with a Federal Reserve

Bank in every case. Instead, such a

deposit is required only if the employer

cannot satisfy the adjudication officer

that the award is otherwise secured. For

example, a large, well-established coal

mine construction employer may be

able to demonstrate that its current size

and assets are sufficient to allow it to

pay benefits for the lifetime of the

claimant. In such a case, the

adjudication officer may permit the

employer to meet the security

requirement in a manner other than

depositing funds with a Federal Reserve

Bank. An employer, for example, may

purchase an indemnity bond, one of the

methods specifically listed in

subsection (a), or may request that the

adjudication officer approve another

mechanism that will guarantee the

payment of benefits in case the

employer ever becomes unable to meet

its obligations.

In addition, the Department does not

accept the premise that it must allow

coal mine construction employers to

avoid the security requirement simply

because most of them are current in

their payment obligations. If even one

such employer currently paying benefits

seeks bankruptcy protection, all of the

awarded claims for which that employer

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80019

is responsible, each of which is worth

approximately $175,000, could become

the responsibility of the Black Lung

Disability Trust Fund. The Department

has a duty to protect the assets of the

Trust Fund, and thus intends to enforce

the post-award security provision

incorporated into the Black Lung

Benefits Act from section 14(i) of the

Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 914(i), as

incorporated by 30 U.S.C. 932(a).

(c) One comment states that coal

transportation employers are generally

unaware of their potential liability for

black lung benefits, and are surprised

when they are identified as a

responsible operator in the adjudication

of an individual claim for benefits. At

that point, the commenter maintains,

any insurance that they are able to

purchase will not cover benefits owed to

the former employee who has already

filed a claim. The commenter requests

that the proposed regulations prohibit

the case-by-case adjudication of issues

of coverage involving coal

transportation employers.

The Department does not believe that

it is necessary to revise the regulations

to provide further guidance to coal

transportation employers. Neither does

the Department deem it advisable to

limit the authority of adjudication

officers to apply the pertinent statutory

and regulatory definitions to claims for

benefits filed by employees of

transportation employers. Congress

amended the Federal Mine Safety and

Health Act in 1977 to include ‘‘any

independent contractor performing

services or construction’’ at the Nation’s

coal mines.’’ 30 U.S.C. 802(d); Pub. L.

95–164, 91 Stat. 1290, § 102(b)(2) (1977).

When it amended the Black Lung

Benefits Act several months later,

Congress specifically recognized, in two

separate provisions, that coal

transportation companies were now

liable for the payment of benefits. First,

Congress amended the definition of the

term ‘‘miner’’ to include ‘‘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.’’ 30 U.S.C.

902(d); Pub. L. 95–239, 92 Stat. 95,

§ 2(b) (1978). In addition, Congress

added language to section 422(b) that

exempted coal transportation

employers, as well as coal mine

construction employers, from the

requirement that they generally secure

the payment of benefits by purchasing

insurance or seeking the Department’s

approval to self-insure their obligations.

30 U.S.C. 932(b); Pub. L. 95–239, 92

Stat. 95, § 7(b) (1978). Congress

provided, however, that coal

transportation and coal mine

construction employers may be required

to post a bond or otherwise guarantee

the payment of benefits in any awarded

claim for which they have been

determined liable. Ibid. The regulations

promulgated by the Department to

implement the 1978 amendments also

specifically recognized the liability of

coal transportation employers. See 20

CFR 725.491(a)(1979); 43 FR 36801–02

(Aug. 18, 1978).

Thus, since 1978, both the statute and

the regulations have put coal mine

transportation employers on notice that

they could be held liable for the

payment of any benefits owed to their

former employees. See Norfolk &

Western Railway Co. v. Roberson, 918

F.2d 1144, 1149–50 (4th Cir. 1990), cert.

denied, 500 U.S. 916. Accordingly, the

Department does not believe that such

an employer should be surprised when

it receives notification of a claim filed

by one of its employees. Federal Crop

Ins. Corp. v. Merrill, 332 U.S. 380, 384–

85 (1947) (‘‘Just as everyone is charged

with knowledge of the United States

Statutes at Large, Congress has provided

that the appearance of rules and

regulations in the Federal Register gives

legal notice of their contents.’’) Finally,

even though a transportation employer

is not required to obtain insurance to

secure its black lung liability, it remains

free to purchase such insurance in order

to ensure that its assets are not depleted

by the defense and payment of black

lung claims.

(d) No other comments were received

concerning this section. The Department

has corrected one error in the proposed

regulation, replacing the phrase ‘‘the

United States Treasurer’’ in subsection

(f) with the term ‘‘a Federal Reserve

Bank.’’ The Department explained in its

initial proposal that the funds will be

deposited with the appropriate Federal

Reserve Bank rather than the United

States Treasurer and had changed

similar language in subsection (c). See

62 FR 3367 (Jan. 22, 1997).

20 CFR 725.608

(a) The Department proposed revising

§ 725.608 in its initial notice of

proposed rulemaking in order 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. The proposal

recognized that black lung beneficiaries

were entitled to the payment of interest

on retroactive benefits, additional

compensation, and medical benefits.

Interest on retroactive benefits starts to

accrue 30 days after the first date on

which the claimant was determined to

be entitled to such benefits. Interest on

additional compensation starts to accrue

on the date that the beneficiary becomes

entitled to additional compensation,

while interest on medical benefits starts

to accrue on the date that the miner

received the medical service or 30 days

after the date on which the miner was

first determined to be generally eligible

for black lung benefits, whichever date

is later. 62 FR 3368 (Jan. 22, 1997)

In addition, the proposal specifically

required the payment of interest by

responsible operators on attorneys’ fee

awards. 62 FR 3368 (Jan. 22, 1997). In

some cases, those awards may be issued

long before the award of claimant’s

benefits becomes final, the first point at

which the attorney is able to collect his

fee under § 28 of the Longshore and

Harbor Workers’ Compensation Act, 33

U.S.C. 928, incorporated into the Black

Lung Benefits Act by 30 U.S.C. 932(a).

The Department did not discuss this

regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) The Department has replaced the

term ‘‘beneficiary’’ with the phrase

‘‘beneficiary or medical provider’’ in

two places in the last sentence of

subsection (a)(4). This revision is

intended to conform that sentence with

the first sentence of subsection (a)(4),

which clearly reflects the Department’s

intention that medical providers as well

as beneficiaries are eligible for interest

to compensate them for any delays in

the payment of medical benefits.

(c) A number of comments oppose the

allowance of interest on attorneys’ fees

in general, and the computation of that

interest from the date the fee is awarded

until it is paid. In its first notice of

proposed rulemaking, 62 FR 3368 (Jan.

22, 1997), the Department explained

that the payment of such interest is

necessary to buttress the economic

value of fees which may take years to

become due because of the duration of

the underlying litigation of claimant

entitlement. Although the Black Lung

Disability Trust Fund is not liable for

the payment of interest in any event,

Shaffer v. Director, OWCP, 21 Black

Lung Rep. (MB) 1–98, 1–99 (Ben. Rev.

Bd. 1998), a responsible operator is not

obliged to pay attorney’s fees until the

claimant successfully establishes

entitlement to benefits in a final award.

Because appeals may delay an award’s

finality for years, the attorney’s fees

awarded at earlier stages of the litigation

will diminish in real value as a result of

inflation. Interest from the date of a fee

award, however, will reduce the inroads

made by inflation. An award of interest

will therefore encourage attorneys to

80020 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

represent claimants because the value of

their fees will be protected,

notwithstanding delays in actual

payment. The Department wishes to

encourage attorney representation of

claimants, believing it a means to

enhance the fairness of the adjudication

process. The Department therefore

rejects the commenters’ objection to the

allowance of interest on attorneys’ fees

in principle.

With respect to the computation of

interest from the date of the attorney fee

award, the Department notes that any

other date would not afford an attorney

maximum protection of the fee’s value.

Although the operator is under no

obligation to pay the fee at the time it

is awarded, the primary purpose of

subsection (c) is to protect the value of

the attorney’s fee from its inception.

Moreover, an operator who is able to

postpone the payment of an attorney’s

fee by appealing the underlying award

of benefits is not entitled to profit from

its decision to appeal unless it succeeds

in overturning the award. The operator

retains the money, and the use of the

money, while the appeal is pending. If

the award of benefits is ultimately

affirmed, the operator should not

reasonably expect to be able to retain

any of the profits it earned on that

money during the appellate proceeding.

Instead, those profits, in the form of

interest designed to compensate an

attorney for delay, rightfully belong to

the attorney who had to wait to receive

payment of his fee. Consequently, the

date of the fee award is the logical date

from which to calculate the interest

owed.

The same commenters also argue that

the Department has no statutory

authority to require the payment of

interest on attorneys’ fees. The award of

fees is governed by section 28 of the

Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. § 928, as

incorporated by 30 U.S.C. § 932(a).

Section 28 authorizes the payment of a

‘‘reasonable’’ attorney’s fee by an

employer if, after the employer

controverts a claimant’s entitlement, the

claimant obtains an award of benefits.

No fee must be paid until the award is

final. The Supreme Court has held that

‘‘[a]n adjustment for delay in payment is

* * * an appropriate factor in the

determination of what constitutes a

reasonable attorney’s fee’’ under a feeshifting statute. Missouri v. Jenkins, 491

U.S. 274, 284 (1989) (decided under

Civil Rights Attorney’s Fees Award Act);

see also Pennsylvania v. Delaware

Valley Citizens’ Council, 483 U.S. 711,

716 (1987) (dicta, decided under Clean

Air Act); Goodloe v. Peabody Coal Co.,

19 Black Lung Rep. 1–91, 1–101–102

(1995), vac. on other grounds sub nom

Peabody Coal Co. v. Director, OWCP,

116 F.3d 207 (7th Cir. 1997) (overruling

prior decisions prohibiting

augmentation of attorney fee for delay,

citing Jenkins). Consequently, interest

on an attorney’s fee may be awarded

consistent with section 28 to

compensate an attorney for delay in

receiving his fees.

The Court of Appeals for the Fourth

Circuit recently addressed this issue in

Kerns v. Consolidation Coal Co., 176

F.3d 802 (4th Cir. 1999). A claimant’s

attorney was awarded fees by an

administrative law judge in 1984, but

was not able to collect those fees until

the award became final in 1990. He then

filed a motion for supplemental

attorneys’ fees based on the six-year

delay between the award and its

payment. The ALJ denied the motion,

and the Benefits Review Board affirmed.

In reversing the Board, the court noted

that a 1995 decision of the Board,

Nelson v. Stevedoring Services of

America, 29 BRBS 90 (1995), had

authorized the enhancement of an

attorney’s fee for delay under the

Longshore and Harbor Workers’

Compensation Act. The court concluded

that ‘‘current law’’ thus required

enhancement for delay, and remanded

the case to allow the ALJ to consider the

merits of the attorney’s supplemental

fee request. 176 F.3d at 805. Section

725.608 simply provides a mechanism

for ensuring that claimants’ attorneys

receive this enhancement in each case

involving a responsible operator.

The interest on a fee award provided

by section 725.608, of course, provides

compensation only for part of the delay

that an attorney may face in collecting

his fee, i.e., the time between the fee

award and the actual payment. It is not

intended to compensate the attorney for

any delay between the performance of

his work and the award of fees by the

appropriate adjudicator. If, for example,

a claimant filed his application in 1995,

and was not awarded benefits by an

administrative law judge until 1999,

§ 725.608 will require only that interest

be paid to the attorney from the date the

ALJ approves the fee petition until the

date that the attorney collects that

amount. It will not provide interest from

the date on which the attorney

performed the work. In such cases, it is

the responsibility of the attorney who

submits a fee request to ensure that the

request reflects any necessary

enhancement for the delay between the

performance of the work and the award

of the fee. There are several methods by

which an attorney may seek

enhancement of his fee award to cover

this delay. For example, the attorney

could request the adjudication officer to

use the attorney’s current rate (his rate

at the time he applies for the fee), rather

than his historical rate (the rate at the

time he performed the work), to

calculate the fee to which he is entitled.

Thus, the attorney in the example

above, who performed 20 hours of work

in 1995 but did not submit his fee

petition until benefits were awarded in

1999, might use the $125 hourly rate he

customarily charged in 1999 rather than

the $100 hourly rate he charged in 1995.

Using the current rate would permit the

attorney to claim an additional $500,

and would compensate him for the

delay between the time he performed

the work and date of the fee award.

Another method of attaining the same

result would be to calculate a ‘‘lodestar’’

amount by multiplying the number of

hours the attorney worked by his

historical rate, and then requesting the

adjudication officer to augment that

figure by an additional amount intended

to compensate the attorney for the

delay. Thus, the attorney in the example

might request that the adjudication

officer multiply the lodestar amount by

an additional 25 percent. In either case,

the fee awarded by the adjudicator, in

concert with the interest provided by

§ 725.608, will ensure that when the

attorney finally receives payment, he is

fully compensated for the work he

performed.

(d) One comment supports the

allowance of interest on attorney fees

and on medical benefits. No other

comments were received concerning

this section, and no changes have been

made in it.

20 CFR 725.609

(a) The Department proposed revising

section 725.609 in its first notice of

proposed rulemaking. In the revised

regulation, the Department clarified its

intent and authority to enforce a final

award of benefits against other parties in

the event the named operator is no

longer capable of assuming its liability

for benefits. The revised regulation

outlined the other parties against which

such an award might be enforced,

including corporate officers and

successor operators. The regulation also

outlined the circumstances under which

the Department may impose liability on

these parties. In proposing this

regulation, the Department relied on

Congress’ explicit determination that

such entities may be held liable for

these awards. 62 FR 3368–69 (Jan. 22,

1997). The Department did not discuss

the regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80021

(b) One comment objects to

subsection (b)’s imposition of personal

liability on corporate officers of

companies which provide services at

mine sites. The commenter suggests that

liability is inappropriate because the

officers have never had notice that their

employees could be considered miners,

and have not previously had knowledge

of an obligation to obtain insurance to

cover their employees’ potential benefit

entitlement. The Department rejects this

suggestion. Congress amended the

statutory definition of ‘‘operator’’ in

1977 to include ‘‘any independent

contractor performing services or

construction at such mine[.]’’ 30 U.S.C.

802(d). The current regulations also

recognize that an independent

contractor may be held liable as a

‘‘responsible operator’’ with respect to

any employee who performs covered

services at a coal mine site. 20 CFR

725.491(c)(1). The Black Lung Benefits

Act requires an operator to secure its

potential benefits liability by obtaining

insurance or qualifying as a self-insurer.

30 U.S.C. 932(b), 933(a). Section

423(d)(1) of the Act authorizes the

Department to impose personal liability

on certain officers of a corporation if the

operator is a corporation that has failed

to satisfy its insurance obligations. 30

U.S.C. 933(d)(1). The Department

therefore disagrees that application of

these provisions to employers engaged

as independent contractors providing

covered services at mine sites is unfair.

Such corporate entities are coal mine

operators under the Act, and are liable

to their employees when covered

employment causes them to become

totally disabled by pneumoconiosis.

Any such entity is required to anticipate

its obligations and take adequate

measures to satisfy those obligations as

a cost of doing business. Moreover,

since 1977, the officers of an

independent contractor who meets the

Act’s definition of the term ‘‘operator’’

have been subject to the Act’s

imposition of liability on the officers of

a corporation that fails to meet its

security obligations. The revised

regulation does not alter the obligation

of these officers to obtain the

appropriate security, nor does it impose

any additional consequences for failing

to comply with that obligation. Instead,

it simply provides more explicit notice

of those consequences.

(c) One comment approves in general

terms of the enforcement provisions.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.620

(a) In its first notice of proposed

rulemaking, the Department proposed

amending the cross-reference in

subsection (a) from § 725.495 to subpart

D of part 726. This amendment reflected

a move to part 726 of the regulations

governing the obligations of coal mine

operators to secure the payment of

benefits. 62 FR 3369 (Jan. 22, 1997). The

Department did not discuss § 725.620 in

its second notice of proposed

rulemaking. See Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) Two comments urge the

Department to revise its regulations to

allow parties to settle black lung

benefits claims. These comments were

listed as relevant to § 725.620(d) in the

Department’s listing of comments by

issue. See, e.g., Exhibit 71 in the

Rulemaking Record. They do not

directly affect § 725.620, however.

Subsection (d) of the regulation

implements section 15(b) of the

Longshore and Harbor Workers’

Compensation Act, 33 U.S.C. 915, as

incorporated by 30 U.S.C. 932(a), rather

than section 16, 33 U.S.C. 916, as

incorporated by 30 U.S.C. 932(a), the

statutory provision governing

settlements. The Department has

responded to the comments concerning

settlement of black lung claims in its

Final Regulatory Flexibility Analysis.

(c) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 725.621

In its first notice of proposed

rulemaking, the Department proposed

increasing subsection (d)’s maximum

penalty amount from $500 to $550 for

failing to file a required report after the

date on which the regulations became

effective. This revision implements the

Civil Penalties Inflation Adjustment Act

of 1990, as amended by the Debt

Collection Improvement Act of 1996. 62

FR 3369 (Jan. 22, 1997). The Department

did not discuss § 725.621 in its second

notice of proposed rulemaking. See

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999). No

comments were received concerning

this section. The Department has

removed an unnecessary comma from

subsection (b) in order to make the

regulation easier to understand, but no

other changes have been made in it.

Subpart J

20 CFR 725.701

(a) After a miner has been found

totally disabled by pneumoconiosis

arising out of coal mine employment,

(s)he receives fixed monthly benefits for

that condition. The miner is also

entitled to medical benefits, i.e.,

treatment, supplies and other medical

services for the disabling

pneumoconiosis. In its initial notice of

proposed rulemaking, the Department

proposed amending § 725.701 to

establish a presumption of medical

benefits coverage for the treatment of

any pulmonary disorder. 62 FR 3423

(Jan. 22, 1997). This presumption

derived from a judicially-created

presumption first announced by the

Court of Appeals for the Fourth Circuit

in Doris Coal Co. v. Director, OWCP

[Stiltner,] 938 F.2d 492 (4th Cir. 1991).

The Department explained the means by

which the presumption could be

rebutted, and limited the type of

evidence relevant to rebuttal by

excluding any medical opinion

premised on the absence of disabling

pneumoconiosis. The Department based

its exclusion of certain medical

evidence in rebuttal on the fact that the

existence of the miner’s totally disabling

pneumoconiosis had already been

established in the underlying claim for

monthly benefits. 62 FR 3369, 3423 (Jan.

22, 1997). The Department received a

number of comments critical of the

presumption. Some comments alleged

the presumption would effectively

compensate miners for disorders caused

by smoking cigarettes and raise the

operators’ health care costs. Other

comments contended the presumption

did not have a sound medical basis. 64

FR 55003 (Oct. 8, 1999).

After considering the public’s

comments and intervening judicial

decisions, the Department proposed

additional changes to the regulation in

its second notice of proposed

rulemaking. 64 FR 55060 (Oct. 8, 1999).

The Department reviewed the decisions

in Glen Coal Co. v. Seals, 147 F.3d 502

(6th Cir. 1998), and Gulf & Western

Indus. v. Ling, 176 F.3d 226 (4th Cir.

1999). 64 FR 55003–04 (Oct. 8, 1999).

The Department noted both decisions

agreed that the Doris Coal presumption

shifted only the burden of production to

the party opposing benefits, and was

therefore valid under the Administrative

Procedure Act (APA), 5 U.S.C. § 556(d)

(proponent of rule bears burden of

persuasion) and Director, OWCP v.

Greenwich Collieries, 512 U.S. 267

(1994). The Department also pointed out

that the majority in Seals rested on a

relatively narrow point: that the

administrative law judge and Benefits

Review Board erroneously applied

Fourth Circuit precedent when Sixth

Circuit law controlled and was

inconsistent with Doris Coal. 147 F.3d

80022 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

at 514 (Dowd, D.C.J), 515 (Boggs, J.).

Citing the need for a uniform standard

of national applicability, the

Department proposed several changes to

§ 725.701. 64 FR 55004 (Oct. 8, 1999).

The Department eliminated the

reference to ‘‘ancillary pulmonary

conditions’’ in subsection (b) because

the phrase was unnecessary and

arguably confusing. 64 FR 55004 (Oct. 8,

1999). The Department also changed the

language of subsection (e) to clarify the

specific facts which might rebut the

presumption that a particular medical

expense is compensable. Subsection (e)

contains a rebuttable presumption that a

pulmonary disorder for which the miner

receives a medical service or supply is

caused or aggravated by

pneumoconiosis. 64 FR 55060 (Oct. 8,

1999). In the second proposal, the

Department also clarified subsection (f)

to ensure that the party opposing

benefits does not attempt to relitigate

established facts by using medical

evidence for rebuttal which is premised

on the absence of totally disabling

pneumoconiosis. Finally, the

Department acknowledged the

controlling weight a report from a

treating physician may receive in

determining the compensability of a

service or supply. 64 FR 55004 (Oct. 8,

1999).

(b) The Department has revised the

rebuttal provisions set forth in

§ 725.701(e) in light of a decision from

the Court of Appeals for the Fourth

Circuit issued after the second notice of

proposed rulemaking entered the final

stage of administrative clearance. In

General Trucking Corp. v. Salyers, 175

F.3d 322 (4th Cir. 1999), the Court

reviewed the various means of rebutting

the Doris Coal presumption as presented

in Ling:

It is certainly true that if the treatment at

issue is found to be ‘beyond that necessary

to effectively treat a covered disorder, or is

not for a pulmonary disorder at all,’ then the

presumption ‘shall not carry the day.’ Ling,

176 F3d at 233. It does not follow, however,

that proof of these two circumstances is the

exclusive means of rebutting the

presumption.

An employer contesting an award of

medical benefits may also rebut the

presumption by adducing sufficient credible

evidence that the claimant was treated for ‘a

pulmonary condition that had not manifested

itself, to some degree, at the onset of his

disability,’ or for ‘a preexisting pulmonary

condition adjudged not to have contributed

to his disability.’ Ling, 176 F.3d at 232.

175 F.3d at 324. The Salyers decision

emphasizes the importance of affording

the party liable for medical benefits an

opportunity to rebut the presumption

with evidence that the service provided

treated a condition which became

manifest after the underlying

adjudication of entitlement, or that it

treated a preexisting pulmonary

condition adjudged not to have

contributed to disability. It is the

Department’s intent merely to codify the

Court’s coverage presumption and its

rebuttal methods as outlined in Fourth

Circuit precedent. In light of Salyers and

Ling, the Department has revised

§ 725.701(e) to conform the regulation’s

rebuttal provisions to the decisions

issued by the Fourth Circuit since Doris

Coal. Accordingly, the Department has

replaced the phrase ‘‘was not for a

covered pulmonary disorder as defined

in § 718.201 of this subchapter,’’ with

‘‘was for a pulmonary disorder apart

from those previously associated with

the miner’s disability[.]’’ The foregoing

explanation also responds to one

comment which faulted the Department

for omitting any discussion of Salyers in

the second notice of proposed

rulemaking.

(c) In response to its second notice of

rulemaking, the Department received

numerous comments opposing the

medical benefits program in general or

the § 725.701(e) presumption in

particular because, in the commenters’

view, coal mine operators would be

forced to pay for medical treatment

unrelated to pneumoconiosis, especially

respiratory disorders caused by cigarette

smoking. These same objections were

made to the version of § 725.701(e)

contained in the Department’s initial

notice of proposed rulemaking. 64 FR

55003 (Oct. 8, 1999). In response, the

Department noted that operators may

submit ‘‘appropriate medical evidence’’

showing the particular medical service

or supply relates to the miner’s

smoking-related disease and not his

pneumoconiosis. 64 FR 55004 (Oct. 8,

1999). An operator may still make such

a showing, although the Department has

revised the rebuttal provisions of

§ 725.701(e) in the final rule. The nexus

between the miner’s pneumoconiosis

and the disorder under treatment is only

presumed, and therefore subject to being

disproved. The operator may produce

evidence showing the treatment was for

a particular pulmonary disorder apart

from those conditions previously

associated with the miner’s disability, or

exceeds the effective level of treatment

for a covered disorder, or did not

involve a pulmonary disorder at all. As

with the Doris Coal presumption,

invocation shifts only the burden of

production, not persuasion. The

operator must confront the presumption

by submitting evidence which, if

credited, establishes one of the means of

rebuttal. Section 725.701(f), however,

does preclude one defense: the operator

cannot escape liability by trying to

prove the medical service cannot

pertain to disabling pneumoconiosis

because the miner was disabled solely

from smoking or some other nonoccupational cause. Once the miner

establishes (s)he is entitled to disability

benefits, no element of entitlement can

be relitigated or otherwise questioned

via the medical benefits litigation.

Consequently, the operator and its

physician must accept that the miner

has a totally disabling respiratory or

pulmonary impairment, and that

pneumoconiosis, as defined in

§ 718.201, is a substantially contributing

cause of that impairment. See Ling, 176

F.3d at 232 and n.13, citing Doris Coal,

938 F.2d at 497 (operator cannot rebut

presumption of benefits coverage by

showing miner’s pneumoconiosis did

not at least aggravate pulmonary

condition because ‘‘[t]he time for that

argument had passed with the prior

adjudication of disability’’).

(d) Two comments state without

explanation that the medical benefits

program implemented by these

regulations will force the coal industry

to ‘‘subsidize’’ other private health

plans and insurance as well as the

Medicare program. The Department

interprets this contention to mean that

the industry and its insurers will be

forced to financially assist other health

care programs by paying for treatment

expenses which are not actually related

to the miner’s pneumoconiosis, and

should be paid by the other programs.

The Department disagrees. Congress

created the black lung medical benefits

program as the primary payor for the

treatment of miners afflicted with

disabling pneumoconiosis. The program

covers the costs of treatment, services

and supplies only for that purpose.

Consequently, the operator may avoid

liability for any expense which is not for

the treatment of totally disabling

pneumoconiosis, and which therefore

should be paid by some other health

care program.

(e) One comment contends the

Department misinterpreted Seals and

Ling in its analysis of those cases. 64 FR

55003–04 (Oct. 8, 1999). The commenter

also states the Department cannot

‘‘overrule’’ Seals by regulation because

that decision is based on an

interpretation of the APA. The

Department rejects both arguments. The

commenter does not identify any

specific mischaracterization or other

error in the Department’s interpretation

of either decision. The Department

believes its analysis is correct, and

declines to change its position on the

meaning of those decisions except to the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80023

extent reflected in changes to the

rebuttal provisions contained in

§ 725.701(e). As for departing from the

APA analysis of the majority in Seals,

the comment is simply incorrect. The

specific majority holding of Seals

reversed the decisions of the

administrative law judge and Benefits

Review Board because of an incorrect

application of Fourth Circuit law to a

case arising in the Sixth Circuit. Judge

Boggs (concurring), however, agreed

with Judge Moore (dissenting) ‘‘that it

would not necessarily contravene

Greenwich Collieries for the Secretary to

adopt a regulation shifting the burden of

production in the manner of Doris

Coal.’’ 147 F.3d at 517. Consequently,

the majority holding does not rest on

any APA considerations, and a majority

of the panel, albeit in dicta,

acknowledges the Department’s

authority under Greenwich Collieries

(and, by extension, the APA) to

promulgate regulatory presumptions

which reallocate burdens among parties.

The Department therefore rejects this

comment.

(f) One comment contends the

presumption of coverage for pulmonary

treatment is not supported by any

scientific or medical information. The

commenter relies largely on a report

prepared by a physician for purposes of

the rulemaking proceedings; the

physician addresses several of the

regulations from a medical standpoint

and reviews the medical literature

compiled during the rulemaking. With

respect to § 725.701(e), the physician

challenges the reasonableness of

presuming a connection between the

miner’s pneumoconiosis and any

pulmonary disorder for which (s)he

seeks treatment. The physician notes

that many pulmonary disorders bear no

relationship to pneumoconiosis, and

their treatment is unaffected by the

presence of pneumoconiosis. The

physician further contends that each

patient encounter must be amply

documented by evidence that the

treatment is necessary for the miner’s

pneumoconiosis, and should include

medical testing, physical examinations,

etc. The Department acknowledges the

concerns expressed by the comment and

accompanying medical views, but does

not consider any change in the

regulation to be necessary.

As an initial matter, the fact that a

physician might view the presumption

as medically unwarranted does not

necessarily undermine its validity as a

legal, or evidentiary, presumption. The

Department understands the physician’s

objection to mean a physician would

not rely on such a presumption as a

basis for treating a patient. Most of the

statutory and regulatory presumptions

in the black lung benefits program,

however, draw factual inferences from a

combination of medical and nonmedical facts for purposes other than

patient care. See 30 U.S.C. § 921(c)(1)

(miner’s pneumoconiosis presumed

caused by coal mine employment if

miner worked ten years); (c)(3) (miner

who has complicated pneumoconiosis

irrebuttably presumed totally disabled);

20 CFR. § 727.203(a)(1)–(4) (proof of one

of enumerated medical facts about

miner’s pulmonary condition invokes

presumption of all remaining elements

of entitlement); 20 CFR. § 725.309

(material change in miner’s medical

condition presumed if miner proves one

element of entitlement in duplicate

claim previously not proven). ‘‘Like all

rules of evidence that permit the

inference of an ultimate fact from a

predicate one, black lung benefits

presumptions rest on a judgment that

the relationship between the ultimate

and the predicate facts has a basis in the

logic of common understanding.’’

Mullins Coal Co. v. Director, OWCP, 484

U.S. 135, 157 n. 30 (1987), reh’g den.

484 U.S. 1047 (1988). The Department

explained the logical basis and

administrative purpose for the

presumption in the notice of reproposed

rulemaking. See generally 64 FR 55004

(Oct. 8, 1999). A miner who is entitled

to disability benefits has proven three

basic medical facts: (s)he has

pneumoconiosis as that disease is

defined by § 718.201; (s)he has a totally

disabling respiratory or pulmonary

impairment; and the pneumoconiosis

significantly contributes to that

respiratory or pulmonary impairment.

Consequently, the miner has established

a connection between the compensable

disease and the disabling lung

condition. From those proven facts,

§ 725.701(e) draws a rational inference

that the need for treating the miner’s

compromised respiratory condition at

any given time is necessitated, directly

or indirectly, by the presence of

pneumoconiosis. This inference is

rebuttable, and the operator may submit

evidence showing the treatment is for a

particular pulmonary disorder apart

from those conditions previously

associated with the miner’s disability, or

exceeds the effective level of treatment

for a covered disorder, or did not

involve a pulmonary disorder at all. The

Fourth Circuit endorsed the same

general line of reasoning in Ling when

it upheld the validity of the Doris Coal

presumption. 176 F.3d at 233–34. The

Department therefore disagrees with the

commenter that § 725.701(e) does not

have a supportable basis which satisfies

the legal test for a rational presumption.

The physician-commenter also urges

the Department to require rigorous

medical documentation for each

medical treatment service, including

contemporaneous objective testing,

examinations, etc., to impose quality

controls on the treatment program. The

Department indirectly addressed this

concern in the notice of reproposed

rulemaking. 64 FR 55004 (Oct. 8, 1999).

The Department noted that it receives

12,000 to 15,000 bills weekly for

treatment services, most of which

involve relatively minor amounts in the

$25.00 to $75.00 range. The Department

cited cost effectiveness and promptness

as practical reasons for using a

presumption of coverage to expedite the

administrative process. The

presumption supplants the need for

more elaborate medical proof that the

particular service or expense involves

the miner’s pneumoconiosis, at least

until the operator challenges the

expense with credible medical

evidence. The Fourth Circuit reached

the same conclusion in Ling:

Hence, rather than compel the miner to

exhaustively document his claim for medical

benefits, i.e., requiring him to again

laboriously obtain all the evidence that he

can that his shortness of breath, wheezing,

and coughing are still the result of his

pneumoconiosis, we have fashioned the

Doris Coal presumption as a shorthand

method of proving the same thing. The proof

needed is a medical bill for the treatment of

a pulmonary or respiratory disorder and/or

associated symptoms.

176 F.3d at 233 (emphasis in original).

Section 725.701(e) does not eliminate

the need for medical documentation for

treatment and services. The

presumption merely provides a shorthand means of identifying expenses

which are likely to be legitimate unless

the liable party opposes payment of

particular expenses.

(g) One comment states generally that

the medical benefits program, as

reproposed, will promote fraud.

Another comment contends that

reliance on the miner’s treating

physician under § 725.701(f) will

promote fraudulent payments because

the doctor has a financial incentive to

attribute the miner’s pulmonary

problems to pneumoconiosis. The

commenter also alludes to a longstanding pattern of abuse of the black

lung program by treating physicians

who mix compensable and noncompensable services when billing the

Trust Fund and operators as

documented in Doris Coal Co. v.

Director, OWCP, 938 F.2d 492, 497–98

(4th Cir. 1991). Finally, the comment

80024 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

objects to the basic concept of special

deference to a treating physician’s

opinion as proposed in § 718.104(d).

With respect to allegations of fraud, the

professional integrity of any physician

should be accepted until particular acts

of malfeasance are established in the

appropriate forum. The comment’s

allegations that particular physicians are

motivated by financial incentives can as

easily be directed toward any partyaffiliated physician, or group of such

physicians, who may benefit by

tailoring conclusions to fit the interests

of the party paying for the medical

opinion. As for the commenter’s specific

suggestion that there is no cost

containment in the program and that

health care providers routinely seek

payment from the program for unrelated

charges, the Department accepts the

holding in Doris Coal. In this decision,

the Court refused to sanction the

practice of submitting an unitemized

bill for multiple services because such

a practice could impose liability on the

insurer for services unrelated to the

treatment of the miner’s

pneumoconiosis and encourage fraud.

938 F.2d at 497–98. The Court, however,

only alluded to the potential for fraud

if unitemized billing were permitted. It

did not address the practice as an

historical reality or beyond the facts

involving the one treating physician

involved in the case. The Department

therefore rejects the position that

miners’ treating physicians should be

viewed with special suspicion as a

group because of a motive for fraudulent

diagnoses and/or treatment. The

Department responds to the objections

concerning special deference to the

treating physician’s opinion, as

proposed in § 718.104(d), in the

preamble to that subsection.

(h) One comment urges the

Department to join the lawsuit filed by

the Department of Justice to recover

money from the tobacco industry for

costs incurred by the black lung

program in treating sick cigarette

smokers. The comment is not directed

to any regulatory proposal, and no

response is therefore warranted.

(i) The Department received several

comments which approve of § 725.701.

(j) No other comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 725.706

The Department proposed changing

the no-approval dollar amount in

§ 725.706(b) from $100.00 to $300.00 in

the initial notice of proposed

rulemaking. 62 FR 3424 (Jan. 22, 1997).

No comments were received concerning

this section, and no other changes have

been made in it.

20 CFR Part 726—Black Lung Benefits;

Requirements for Coal Mine Operators’

Insurance

The Department has received one

comment relevant to Part 726 in its

entirety. The Department proposed

revising only specific regulations in Part

726, and invited comment only on those

regulations, see 62 FR 3340 (Jan. 22,

1997); 64 FR 54970 (Oct. 8, 1999). The

Department either made only technical

revisions to the remaining regulations in

Part 726, or made no changes, see 62 FR

3340–41 (Jan. 22, 1997) (lists of

technical revisions and unchanged

regulations); 64 FR 54970–71 (Oct. 8,

1999) (same). Therefore, no changes are

being made to Part 726 in its entirety.

Subpart A

20 CFR 726.2

In its initial notice of proposed

rulemaking, the Department proposed

adding subsection (e) to this regulation

in order to recognize the addition of

subpart D, implementing the civil

money penalty provision of 30 U.S.C.

933, to part 726. 62 FR 3369 (Jan. 22,

1997). The Department did not discuss

the regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

The Department has capitalized the

word ‘‘subpart’’ in subsection (b) to be

consistent with the use of that word in

subparts (c), (d), and (e). In subsection

(d), the Department has replaced the

phrase ‘‘coal operator’’ with the phrase

‘‘coal mine operator’’ to be consistent

with subsections (c) and (e). No

comments were received concerning

this section, and no other changes have

been made in it.

20 CFR 726.3

This regulation was not opened for

comment in the Department’s first

notice of proposed rulemaking. See list

of Unchanged Regulations, 62 FR 3341

(Jan. 22, 1997). The Department

proposed a revision to subsection (b) in

its second notice of proposed

rulemaking at the request of the Office

of Federal Register to clarify the

treatment of cases in which the

regulations in Part 726 appear to

conflict with the regulations

incorporated from Part 725. 64 FR 55005

(Oct. 8, 1999). In subsection (a), the

Department has replaced the phrase

‘‘coal operator’’ with the phrase ‘‘coal

mine operator’’ to be consistent with

subsection (b). No comments were

received concerning this section, and no

other changes have been made in it.

20 CFR 726.8

(a) The Department proposed adding

§ 726.8 in its first notice of proposed

rulemaking in order to define certain

terms including ‘‘employ’’ and

‘‘employment.’’ The definition of

‘‘employ’’ and ‘‘employment’’ proposed

in subsection (d), was identical to that

in proposed § 725.493(a)(1). 62 FR 3369

(Jan. 22, 1997). In its second notice of

proposed rulemaking, the Department

incorporated into subsection (d) a

change to the definition of the term

‘‘employment’’ that it had also made to

§ 725.493. 64 FR 55005 (Oct. 8, 1999).

The Department also responded to

comments concerning the retroactive

effect of the proposal and the scope of

the definitions. The Department stated

its belief that the proposal was neither

improperly retroactive nor an

instrument for creating additional

insurer liability. Neither did the

proposal intrude on insurance functions

reserved to the states. The Department

noted the Court of Appeals for the

Seventh Circuit’s holding that the Black

Lung Benefits Act ‘‘specifically relates

to the business of insurance and

therefore does not implicate the

McCarran-Ferguson Act,’’ 15 U.S.C.

1012, which confers primacy on state

law for the regulation of the insurance

industry, unless a conflicting federal

statute specifically provides otherwise.

Lovilia Coal Co. v. Williams, 143 F.3d

317, 325 (7th Cir. 1998). The

Department also justified the scope of

the proposed definition as well within

the rulemaking authority granted the

Department by Congress.

(b) One comment objects to the

Department’s definitions of the terms

‘‘employ’’ and ‘‘employment.’’ The

commenter argues that the Department

is improperly interfering with existing

employment relationships by adopting

regulations that differ from those

provided by state employment and

insurance laws. The Department

provided a detailed explanation of both

its authority and its reasoning for

proposing this regulation in its October

8, 1999 proposal. See 64 Fed. Reg.

55005 (Oct. 8, 1999). The Department

does not agree that the regulations it

issues to implement the Black Lung

Benefits Act interfere with employment

relationships recognized by the various

states. The Black Lung Benefits Act

requires that a coal mine operator’s

liability for a miner’s black lung benefits

be based on that operator’s employment

of the miner. See 30 U.S.C. 932(a)

(making the operator of a coal mine

liable for benefits based on ‘‘death or

total disability due to pneumoconiosis

arising out of employment in such

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80025

mine’’). Congress did not specifically

define the term ‘‘employment,’’

however. In such cases, an

administrative agency is authorized to

promulgate regulations to fill the gaps

Congress left in the statute. Morton v.

Ruiz, 415 U.S. 199, 231 (1974). In

addition, the Department is authorized

to promulgate regulations to ensure

sufficient insurance coverage for all of

the liabilities borne by operators under

the Act. 30 U.S.C. 933(b)(3) (permitting

the Secretary to promulgate regulations

governing the content of insurance

policies issued to cover liability under

the Black Lung Benefits Act). The

Department’s definition of the terms

‘‘employ’’ and ‘‘employment’’ is

intended to meet its responsibility to

properly administer the Black Lung

Benefits Act. The Department does not

believe that its definitions will in any

way affect the application of state law

to the relationships between coal mine

operators and the miners they employ.

(c) The same commenter also argues

that the Department’s regulation will

eliminate the ability of a coal mine

operator to enter into an employee

leasing arrangement with an employee

leasing company. The commenter

observes that the current model

employee leasing rule of the National

Association of Insurance Commissioners

requires the employee leasing company

to provide workers’ compensation

coverage, including federal black lung

benefits coverage, for its employees.

According to the commenter, the

Department’s proposal, which would

hold lessors responsible for the

insurance of their leased employees,

will make employee leasing a less viable

option.

The Department does not believe that

its proposal will interfere with an

employer’s economic decision to use

leased employees in its coal mine

operations. Moreover, the Department

does not intend to force coal mine

operators to secure the payment of

benefits for leased employees when the

leasing company has already obtained

the necessary insurance. In such cases,

the operator will be considered to have

met the security requirements of the Act

with respect to those employees. Such

a practice is sound from the point of

view of both the traditional coal mine

operator and the employee leasing

company. Although the commenter

suggests that leasing companies are not

mine operators, that is not entirely clear

under the Black Lung Benefits Act.

Section 423(a) of the Act, 30 U.S.C.

§ 933(a), requires ‘‘each operator of a

coal mine’’ to secure the payment of

benefits by qualifying as a self-insurer or

purchasing insurance. The term

‘‘operator,’’ as used in section 423(a),

includes ‘‘independent contractors who

perform services or construction at such

mines.’’ 30 U.S.C. § 802(d). This

definition of ‘‘operator’’ thus includes

companies that provide employees

under a leasing arrangement. The

Department therefore does not agree that

employee leasing companies should not

be considered ‘‘operators’’ under the

Black Lung Benefits Act. The

Department’s ability to monitor the use

of temporary contractual arrangements

by the coal mining industry, however, is

limited. In addition, the commenter’s

different interpretation of the term

‘‘operator’’ suggests that any effort to

impose civil money penalties on a

leasing company under Part 726, or to

assign liability to such an entity under

Part 725, would be vigorously contested.

Accordingly, the Department has

defined the terms ‘‘employ’’ and

‘‘employment’’ in a manner which

maximizes its ability to ensure the

insurance coverage of leased employees.

By contrast, the application of both

Parts 725 and 726 to traditional coal

mine operators is quite clear. The Act

authorizes the Department to ensure

that all of the individuals performing

mining work under that operator’s

direction are covered by appropriate

security. In addition, those coal mine

operators who use leased employees are

in the best position to ensure that those

employees are covered by the necessary

insurance. The Department does not

intend to require that the traditional

coal mine operator purchase insurance

when the leasing company has done so,

but it does intend the regulations to

provide an incentive for the coal mine

operator to deal only with those leasing

companies that have purchased

insurance meeting federal standards for

black lung benefits coverage. See 20

CFR 726.203 (1999). Contrary to the

commenter’s suggestion, the rule thus

does not make insurers and state funds

the enforcement officers of the

Department. Rather, the traditional coal

mine operator is simply on notice that

it may be held liable for the benefits of

leased employees if the leasing

company fails to procure the necessary

insurance coverage, or for any civil

money penalties arising as a result of

that failure.

(d) Finally, the same comment objects

that the Department’s regulation is

impermissibly retroactive. The

Department has discussed the

retroactive effect of its regulations in

considerable detail in both its first and

second notices of proposed rulemaking.

See discussions of § 725.2 at 62 Fed.

Reg. 3347–48 (Jan. 22, 1997) and 64 Fed.

Reg. 54981–82 (Oct. 8, 1999). In those

discussions, the Department recognized

that it lacks the authority to make

substantive changes to the regulations in

a manner that applies retroactively. For

example, if the previous civil money

penalty regulation, 20 CFR 725.495

(1999), did not permit the assessment of

penalties against an operator for its

failure to secure the benefits payable to

its leased employees, the Department

may not assess a penalty against that

operator under the revised regulations

for any period prior to the effective date

of these regulations. Although the

Department believes that the previous

regulation is broad enough to permit the

assessment of civil money penalties in

these cases, it also recognizes that the

issue must be resolved on a case-by-case

basis in the context of litigating penalty

assessments.

It is also important to note that the

revised regulation does not affect the

liability of insurers for claims filed prior

to the effective date of the regulations.

Under the insurance endorsement set

forth at § 726.203, an insurer is already

liable for all of the miners employed by

its insured. See Lovilia Coal Co. v.

Williams, 143 F.3d 317, 322 (7th Cir.

1998). An employer’s liability, in turn,

is determined by the regulations set

forth at 20 CFR §§ 725.491–.495. The

Department has stated explicitly that the

revised version of those regulations will

not be applied retroactively. See § 725.2.

Accordingly, if the prior regulations did

not permit the imposition of liability

against a coal mine operator for benefits

owed to a miner whose services were

obtained from a leasing company, they

will not permit imposition of liability

against that operator’s insurer. The

Department thus does not agree that the

revised regulation is impermissively

retroactive.

(e) No other comments were received

concerning this section, and no changes

have been made in it.

Subpart B

20 CFR 726.101

In its initial notice of proposed

rulemaking, the Department proposed

revising this regulation to delete the

formula used in 1974 to establish the

amount and types of security required

for an operator to be authorized to selfinsure. The proposal also removed the

reference in subsection (a) to indemnity

bonds and negotiable securities as the

only forms of acceptable security. 62 FR

3369 (Jan. 22, 1997). The Department

did not discuss the regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999). The Department has revised

80026 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

subsections (b)(1), (2), and (3), and

subsection (c) in order to clarify the

meaning of the regulation. No comments

were received concerning this section,

and no other changes have been made

in it.

20 CFR 726.104

In its initial notice of proposed

rulemaking, the Department proposed

revising subsection (b) to recognize two

additional forms of security available to

an authorized self-insurer: Letters of

credit and tax-exempt trusts. 62 FR 3369

(Jan. 22, 1997). The Department did not

discuss the regulation in its second

notice of proposed rulemaking. See list

of Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

The Department has revised subsections

(a) and (d) to clarify the meaning of

those provisions. The Department

received one comment concerning this

regulation; that comment is addressed

under § 726.106. No other comments

were received concerning this section,

and no other changes have been made

in it.

20 CFR 726.105

In its initial notice of proposed

rulemaking, the Department proposed

deleting the reference to the formula

contained in 20 CFR 725.101(1999), in

favor of a non-exclusive list of factors to

be considered by the Department in

determining the appropriate amount of

security required to be provided by a

self-insured operator. 62 FR 3369 (Jan.

22, 1997). The Department did not

discuss the regulation in its second

notice of proposed rulemaking. See list

of Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

The Department has revised the first

and third sentences of the regulation in

order to clarify their meaning. No

comments were received concerning

this section, and no other changes have

been made in it.

20 CFR 726.106

(a) In its initial notice of proposed

rulemaking, the Department proposed

deleting an incorrect reference to

specific sections in Title 31 of the Code

of Federal Regulations and replacing the

reference with a citation to the

appropriate regulatory part governing

deposits with the United States. 62 FR

3369 (Jan. 22, 1997). The Department

did not discuss the regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999).

(b) One comment urges the

Department to include language in this

regulation confirming the sole liability

of a surety company which writes the

most recent indemnity bond for a

responsible operator, and the

exoneration of all previous sureties. No

change in the regulation is necessary. In

United States of America v. Insurance

Co. of North America, 83 F.3d 1507

(D.C. Cir. 1996), the Department argued

that a surety assumes liability for all of

an operator’s existing obligations when

the bond is written and continuing until

the termination of the bond. The Court

rejected this argument. It held that a

surety is liable only for those obligations

which actually accrue to the responsible

operator during the lifetime of the bond,

and not for all outstanding liabilities of

the insured entity. 83 F.3d at 1511. The

Court also rejected the notion that each

successive bond exonerates any

previous surety to which liability has

attached. 83 F.3d at 1512–13. The Court

based these holdings on its

interpretation of the bond language

itself. Consequently, the commenter’s

recommendation can be accomplished

only by further specifying in the bond’s

language, as prescribed by the

Department, the scope of the bond’s

coverage and its terms of release. The

Department has yet to determine

whether revision of the bond form is

appropriate. In any event, the

commenter’s suggestion does not

require changing the language of the

regulation.

(c) The Department has revised the

first sentences of subsections (b) and (c)

to clarify the meaning of these

provisions. No other comments were

received concerning this section, and no

other changes have been made in it.

20 CFR 726.109

In its initial notice of proposed

rulemaking, the Department proposed

deleting specific references to

indemnity bonds and negotiable

securities in favor of more general

references to the security required to be

provided by a self-insured operator. 62

FR 3369 (Jan. 22, 1997). The Department

did not discuss the regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999). The Department has revised the

second and third sentences of the

regulation in order to clarify their

meaning. No comments were received

concerning this section, and no other

changes have been made in it.

20 CFR 726.110

In its initial notice of proposed

rulemaking, the Department proposed

deleting references to indemnity bonds

and negotiable securities in subsections

(a)(3) and (b) in favor of more general

references to the security required to be

provided by a self-insured operator. 62

FR 3369 (Jan. 22, 1997). The Department

did not discuss the regulation in its

second notice of proposed rulemaking.

See list of Changes in the Department’s

Second Proposal, 64 FR 54971 (Oct. 8,

1999). The Department has revised the

regulation to clarify its meaning. No

comments were received concerning

this section, and no other changes have

been made in it.

20 CFR 726.111

In its initial notice of proposed

rulemaking, the Department proposed

deleting a reference to indemnity bonds

and negotiable securities in favor of a

more general reference to the security

required to be provided by a selfinsured operator. 62 FR 3369 (Jan. 22,

1997). The Department did not discuss

the regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

The Department has revised the

regulation to clarify its meaning. No

comments were received concerning

this section, and no other changes have

been made in it.

20 CFR 726.114

In its initial notice of proposed

rulemaking, the Department proposed

adding subsection (c) to codify the

Department’s position that self-insured

coal mine operators who cease mining

coal nevertheless have a continuing

responsibility to maintain adequate

security to cover their potential liability

under the Black Lung Benefits Act. The

Department also replaced a specific

reference to negotiable securities and

indemnity bonds in subsection (b) with

a more general reference to the security

required to be provided by a selfinsured operator. 62 FR 3369 (Jan. 22,

1997). The Department did not discuss

the regulation in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999). In

the third sentence of subsection (a), the

Department has replaced the word

‘‘have’’ with the word ‘‘has’’ to make the

sentence grammatically correct. The

Department has also revised subsections

(a) and (c) to clarify their meaning. No

comments were received concerning

this section, and no other changes have

been made in it.

Subpart C

20 CFR 726.203

(a) The Department made technical

revisions to § 726.203 in its first notice

of proposed rulemaking, but did not

open the regulation for comment. See

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80027

list of Technical revisions, 62 FR 3340–

41 (Jan. 22, 1997). At the Department’s

July 22, 1997 hearing in Washington,

D.C., however, the Department heard

testimony indicating that, since 1984,

the insurance industry had used an

endorsement for black lung insurance

that differed from the endorsement set

forth in § 726.203. Transcript, Hearing

on Proposed Changes to the Black Lung

Program Regulations, July 22, 1997, p.

127 (testimony of Robert Dorsey). In its

written comments, the industry stated

that the Department had approved use

of the new endorsement. Because the

Department’s records contained no

document authorizing use of a different

endorsement, the Department opened

the regulation for comment, and invited

the industry to produce proof that the

Department had approved the change.

In addition, the Department invited

comment on the endorsement language

that the insurance industry had

supplied. 64 FR 55005–06 (Oct. 8,

1999).

(b) In response to the second notice of

proposed rulemaking, the insurance

industry submitted two affidavits.

Rulemaking Record, Exhibit 89–37,

Appendix G. One, from a former vice

president and general counsel of the

National Council on Compensation

Insurance (NCCI), states that ‘‘NCCI was

informed by officials of the Office of

Workers’ Compensation Programs, in

writing, that the agency had no

objection to the changes.’’ The affidavit

also states that the changes were put

into use. The other affidavit, from

NCCI’s current general counsel, states

that NCCI’s schedule for the retention of

records requires the council to maintain

correspondence for 10 years, and that

correspondence more than 10 years old

is destroyed in accordance with

established policy. Accordingly, the

affiant stated, NCCI was unable to

produce a copy of the Department’s

‘‘acknowledgment’’ of the revised

insurance endorsement.

The Department has conducted a

second thorough search of its files,

including files in the Office of Workers’

Compensation Programs, the

Employment Standards Administration,

and the Office of the Solicitor. Although

the Department’s files contain

correspondence with NCCI dating back

to 1984, the Department’s search failed

to produce any correspondence in

which the Department approved NCCI’s

revised insurance endorsement.

Moreover, the Department does not

believe that it would have approved the

proposed revision. The revision differs

in two material respects from the

endorsement set forth in § 726.203.

First, the revision limits an insurer’s

liability for claims that are based on

employment that ended before an

operator first obtained insurance to

secure its liability under the Act.

Second, the revision limits an insurer’s

liability for claims that are approved as

a result of amendments to the Black

Lung Benefits Act.

The current black lung insurance

endorsement obligates an insurer to

provide coverage to an operator in two

different types of claims. First, the

insurer is liable when the miner’s last

exposure to coal mine dust in the

employment of the insured ‘‘occurs

during the policy period.’’ Thus, if a

miner is last employed by XYZ Coal

Company on March 1, 1990, and XYZ

Coal Company is the coal mine operator

responsible for the payment of that

miner’s benefits, the insurer whose

policy covered XYZ on March 1, 1990

will be liable for the payment of those

benefits. In addition, however, the

endorsement covers a second type of

claim. Prior to the Black Lung Benefits

Reform Act of 1977, the Black Lung

Benefits Act obligated employers to pay

benefits to former employees who were

totally disabled due to pneumoconiosis

arising out of coal mine employment, no

matter when their employment ended.

See Usery v. Turner Elkhorn Mining Co.,

428 U.S. 1, 15–16 (1976) (observing that

the Act has ‘‘some retrospective effect’’).

Because operators were not required to

purchase insurance until January 1,

1974, however, the endorsement

contained a second clause providing

coverage if the miner’s last exposure in

the employment of the insured operator

‘‘occurred prior to (effective date) and

claim based on such disease is first filed

against the insured during the policy

period.’’ Thus, if a miner last worked for

XYZ Coal Company in 1972, but did not

file a claim until July 1, 1978, the

insurer whose policy covered XYZ on

the 1978 filing date would be liable for

the miner’s benefits.

The regulations define the term

‘‘effective date’’ in the endorsement as

the effective date of the operator’s first

insurance policy providing coverage for

the operator’s federal black lung benefits

liability. 20 CFR 726.203(b) (1999).

Thus, if the operator did not obtain its

first policy until January 1, 1974, that

policy would cover any claims based on

employment that ended prior to that

date. The revised endorsement offered

by the insurance industry replaces the

term ‘‘effective date’’ with the date ‘‘July

1, 1973.’’ Although a number of

operators did purchase insurance before

January 1, 1974, none did so until after

July 1, 1973. Accordingly, the industry’s

revised endorsement would potentially

leave coal mine operators uninsured for

certain claims. For example, if an

operator did not purchase insurance

until November 1, 1973, the revised

endorsement would cover the miner’s

last exposure in the employment of the

insured operator only if it ‘‘occurred

prior to July 1, 1973,’’ and therefore

would not cover any claims based on

employment that ended between July 1,

1973 and November 1, 1973. If the coal

company is still in business, the claim

would be the responsibility of that

company. If the coal company is no

longer in business, the claim would

become the responsibility of the Black

Lung Disability Trust Fund. Either

result is unacceptable. Although the

Department recognizes that this change

would not affect a significant number of

claims, it could materially alter the

liability of the insurance industry in

some cases. Thus, the Department does

not believe that the revision is

appropriate.

The second material change in the

endorsement is potentially more

serious. The current endorsement

obligates an insurer for liability that

arises under the Black Lung Benefits Act

and ‘‘any laws amendatory thereto, or

supplementary thereto, which may be or

become effective while this policy is in

force.’’ Following the Black Lung

Benefits Reform Act of 1977, several

Virginia coal mine operators sued two

insurers in federal district court to

obtain a declaratory judgment regarding

the coverage of claims that were subject

to approval under the new criteria. The

court agreed with the operators and held

that, under the Department’s

endorsement, a policy was ‘‘in force’’ as

long as claims could be filed against it.

National Independent Coal Operators

Association, Inc. v. Old Republic

Insurance Co., 544 F. Supp. 520, 527–

8 (W.D.Va. 1982). The court accordingly

rejected the argument of the insurers

that the term ‘‘in force’’ was

synonymous with the term ‘‘policy

period,’’ and that an insurer was liable

only to the extent of amendatory or

supplementary laws enacted during the

one-year period covered by each policy.

See 20 CFR 726.206 (a policy shall be

issued for the term of one year from the

date on which it becomes effective). The

court stated that if the insurers had

intended that meaning ‘‘it should have

been made clear to the plaintiffs

[operators] by either using ‘policy

period’ where the words ‘in force’

appear, or by defining ‘in force’

somewhere in the contract.’’ National

Independent Coal Operators

Association at 528.

The court’s decision was issued in

1982, and the insurance industry

quickly accepted the court’s invitation.

80028 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

The revised endorsement, apparently

submitted to the Department in 1983,

replaces the language in the current

endorsement that obligates the insurer

to cover liability resulting from

amendments while the policy is ‘‘in

force’’ with a phrase obligating the

insurer to cover liability resulting from

‘‘any amendment to the law that is in

effect during the policy period.’’ This

altered language would permit the

insurance industry to accomplish what

it failed to win in the 1982 litigation,

i.e., an exemption from liability

resulting from any future amendments.

Like the other proposed change, this

revision would increase the exposure of

coal mine operators and the Black Lung

Disability Trust Fund, and is therefore

unacceptable to the Department.

Because the revised black lung

endorsement offered by the insurance

industry materially alters the obligations

and coverage provided by the insurance

industry under the Black Lung Benefits

Act, the Department must reject that

endorsement. Accordingly, no changes

are made to § 726.203.

(c) One comment urges the

Department to add a sentence to

subsection (d) of the regulation. The

sentence, which the commenter states

would conform the regulation to state

regulatory regimes, would read as

follows: ‘‘The requirements of this

section shall be construed to the extent

possible, harmoniously with the

workers’ compensation rules and

practices of the state is [sic] when the

coverage is provided.’’ Rulemaking

Record, Exhibit 89–37, pp. 177–178.

The commenter does not suggest any

problem in the current regulations that

this sentence is intended to correct, and

the Department declines to add a

sentence whose intent is unclear. To the

extent that this sentence could be

interpreted to require a result different

from that reached in Lovilia Coal Co. v.

Williams, 143 F.3d 317 (7th Cir. 1998),

in which the Court of Appeals for the

Seventh Circuit held that the federal

black lung insurance endorsement was

not subject to exclusions available

under state law, the Department also

does not believe that it would be

appropriate.

The commenter also renews a

suggestion, made in response to the first

notice of proposed rulemaking, that

subsections (b) and (c)(2) of § 726.203

should be eliminated. The commenter’s

first suggestion is premised on the

Department’s acceptance of the

insurance industry’s revised

endorsement. As discussed above, the

Department does not believe that the

revised endorsement provides necessary

coverage and therefore has refused to

accept it. The commenter’s second

suggestion states that the addition of

subsections (b)(1) and (b)(2) to § 725.493

have created a conflict with

§ 726.203(c)(2), and made the latter

provision redundant. The Department

disagrees because the two regulations

serve wholly different purposes. Section

725.493(b)(1) governs the liability of

prior and successor operators in two

cases: (1) Where the miner was

employed by the successor after the sale

giving rise to successor liability; and (2)

where the miner was never employed by

the successor operator. Subsection (b)(2)

governs the successor liability of

companies whose relationship to the

prior operator is as a parent company,

as members of joint ventures, a partner,

or a company that substantially owned

or controlled the prior operator. Section

726.203(c)(2) governs the interpretation

of the insurance contract in a case

where the insured company is liable as

a successor operator. Because the

sections 725.493 and 726.203 govern

different subjects, the Department does

not believe that the regulations are in

conflict, or that subsection (c)(2) is

redundant.

(d) No other comments were received

concerning this section, and no changes

have been made in it.

20 CFR 726.208

Although the Department received

comments under this section, the

regulation was not open for comment,

see 62 Fed. Reg. 3341 (Jan. 22, 1997); 64

Fed. Reg. 54970 (Oct. 8, 1999). The

Department made only a technical

change to the regulation in the second

notice of proposed rulemaking.

Accordingly, no changes are being made

in this section.

20 CFR 726.211

Although the Department received

comments under this section, the

regulation was not open for comment,

see 62 Fed. Reg. 3341 (Jan. 22, 1997); 64

Fed. Reg. 54970 (Oct. 8, 1999). The

Department made only a technical

change in the regulation. Accordingly,

no changes are being made in this

section.

Subpart D

20 CFR 726.300–726.320

(a) In its first notice of proposed

rulemaking, the Department proposed a

complete revision of the procedural and

substantive regulations governing the

imposition of civil money penalties

against operators that fail to secure the

payment of benefits under the Black

Lung Benefits Act, 30 U.S.C. 933(d)(1).

62 FR 3370 (Jan. 22, 1997). These

revisions included a series of graduated

penalties based on the number of the

operator’s employees, the length of time

the operator’s uninsured status

continues following notification, and its

constructive and actual notice of its

obligation to secure. In addition, the

Department proposed allowing the

initial assessment of penalties by the

Office of Workers’ Compensation

Programs to become final if neither the

operator nor its officers filed a timely

notice of contest. The proposal also

subjected decisions of administrative

law judges on penalty issues to

discretionary review by the Secretary.

The Department did not discuss these

regulations in its second notice of

proposed rulemaking. See list of

Changes in the Department’s Second

Proposal, 64 FR 54971 (Oct. 8, 1999).

(b) The Department has made several

minor changes to the regulations in

Subpart D of Part 726. In § 726.302(c)(3)

and (4), the Department replaced a

reference to subsection (b) with a

reference to subsection (c)(2)(i) to

correctly identify the applicable

provision. In § 726.308, the Department

corrected the address of the Black Lung

Benefits Division of the Office of the

Solicitor and added a reference to

§ 725.311, which lists federal holidays.

In § 726.313(f), the Department replaced

the word ‘‘will’’ with the word ‘‘shall’’

to clarify the Department’s intent. The

Department has made minor revisions to

§§ 726.300, 726.301, 726.302, and

726.305 to clarify their meanings.

(c) One comment is critical of the

Department’s failure to enforce its

current requirement (20 CFR § 725.495

(1999)) that coal mine operators either

purchase commercial insurance or

qualify as self-insured entities. The

commenter argues that if § 725.495 was

enforced to its fullest extent, the

Department would not find it necessary

to alter the methods used to identify

responsible operators. The Department

provided a detailed explanation of the

purpose behind its proposed revision of

the civil money penalty regulations in

its initial notice of proposed

rulemaking. 62 FR 3370–71 (Jan. 22,

1997). Subpart D of part 726 replaces

§ 725.495 with a comprehensive scheme

for the imposition of graduated

penalties on those operators who fail to

secure their liability for benefits. The

previous regulation required only that

an administrative law judge levy the

maximum penalty possible in the

absence of ‘‘mitigating circumstances,’’

and provided no guidance or criteria for

determining an appropriate assessment.

The revised regulations fill this void.

The Department thus disagrees with the

commenter’s view that vigorous

enforcement of penalties under 20 CFR

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80029

§ 725.495 (1999) would eliminate the

need to revisit the Department’s method

of identifying responsible operators.

Consequently, the revised regulations

represent a necessary exercise of the

Department’s rulemaking authority.

(d) One comment generally

characterizes this revision as adding

‘‘onerous’’ penalties to the current

program, but makes no specific criticism

of them. The revised Subpart D of part

726 does not add any penalty not

specifically authorized by 30 U.S.C.

§ 933(d), and not contained in the

previous regulations. Moreover, the

graduated scale of penalties contained

in the revision provides specific

guidelines for computing penalties and

may result in a lesser penalty being

imposed than the former regulation

would have required. This comment

does not provide any other basis for a

substantive response by the Department.

(e) One comment observes that the

prospect of civil money penalties may

encourage an unsecured operator to pass

on its liabilities to an insured successor

whose carrier has not collected a

premium reflecting the additional

liability. To the extent that such a

possibility exists in cases where the

prior operator subsequently becomes

unable to pay benefits to its former

employees, it implicates business

considerations, not legal questions. An

insured operator should weigh the

potential effect of acquiring an entity

with unsecured benefits liability as a

factor in the financial soundness of

making the acquisition. The possibility

of adverse economic effects on some

future mergers or acquisitions, however,

does not excuse the Department’s

obligation to enforce compliance with

the Act’s insurance requirements and to

penalize a failure to comply.

(f) Two comments approve of the

proposed civil money penalties. No

other comments were received

concerning this subpart, and no other

changes have been made in it.

20 CFR Part 727

(a) In its first notice of proposed

rulemaking, the Department proposed

deleting Part 727 from title 20 of the

Code of Federal Regulations. 62 FR

3371, 3435 (Jan. 22, 1997). The

Department explained that the Part 727

regulations, which govern black lung

benefits claims filed prior to April 1,

1980, are relevant only to a small

minority of the claims currently

pending. Because the parties to those

claims are already familiar with the

standards in Part 727, the Department

proposed to discontinue the annual

publication of that part. In lieu of

continued publication, section 725.4(d),

as revised, will refer individuals to the

1999 version of title 20 of the Code of

Federal Regulations for a copy of the

regulations. See discussion of § 725.4,

above; 62 FR 3348, 3386 (Jan. 22, 1997).

The Department did not discuss Part

727 in its second notice of proposed

rulemaking. See list of Changes in the

Department’s Second Proposal, 64 FR

54971 (Oct. 8, 1999).

(b) Three comments urge the

Department not to discontinue its

annual publication of Part 727 because

the part governs claims still pending in

various stages of adjudication. Although

the Department recognizes that the Part

727 regulations are applicable to some

pending claims, the Department does

not believe that the existence of this

relatively small number of cases justifies

the continued publication of the part in

the Code of Federal Regulations. The

parties to these claims are already

familiar with the regulations, and have

received sufficient notice of the

Department’s intention to cease

publication to allow them to retain their

current copies of the Code. Accordingly,

the Department has discontinued the

annual publication of Part 727.

(c) No other comments were received

concerning this part, and no changes

have been made in it.

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 Office of Information and

Regulatory Affairs of the Office of

Management and Budget has

determined that the Department’s

proposed rule represents a ‘‘significant

regulatory action’’ under section 3(f)(4)

of Executive Order 12866 and has

reviewed the rule.

Unfunded Mandates Reform Act

For purposes of the Unfunded

Mandates Reform Act of 1995, 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 in any one year.

Executive Order 13132

The Department has reviewed this

rule in accordance with Executive Order

13132 regarding federalism, and has

determined that it does not have

‘‘federalism implications.’’ The rule

does not have ‘‘substantial effects on the

States, on the relationship between the

national government and the States, or

on the distribution of power and

responsibilities among the various

levels of government.’’

Paperwork Reduction Act

The changes establish no new record

keeping requirements. Moreover, they

reduce the volume of medical

examination and consultants’ reports

which currently are created solely for

litigation by limiting the amount of such

medical evidence which will be

admissible in black lung proceedings.

Regulatory Flexibility Act, as Amended

The Regulatory Flexibility Act

(‘‘RFA’’) was enacted by Congress in

1980 ‘‘to encourage administrative

agencies to consider the potential

impact of nascent federal regulations on

small businesses.’’ Associated Fisheries

of Maine, Inc. v. Daley, 127 F.3d 104,

111 (1st Cir. 1997). The preamble to the

RFA provides in part as follows:

It is the purpose of this Act to establish as

a principle of regulatory issuance that

agencies shall endeavor, consistent with the

objectives of the rule and of applicable

statutes, to fit regulatory and informational

requirements to the scale of the businesses,

organizations, and governmental

jurisdictions subject to regulation. To achieve

this principle, agencies are required to solicit

and consider flexible regulatory proposals

and to explain the rationale for their actions

to assure that such proposals are given

serious consideration.

Pub. L. 96–354, 94 Stat. 1165 (1980).

The RFA outlines in some detail the

analysis required for compliance.

Unless the agency certifies that the rule

will not have ‘‘a significant economic

impact on a substantial number of small

entities,’’ 5 U.S.C. 605, each agency that

publishes a notice of proposed

rulemaking must prepare an ‘‘initial

regulatory flexibility analysis’’

describing the impact of the proposed

rule on small entities. 5 U.S.C. 603(a).

That analysis, or a summary of the

analysis, must be published in the

Federal Register when the notice of

proposed rulemaking is published, and

a copy of the analysis must be sent to

the Chief Counsel for Advocacy of the

Small Business Administration.

80030 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

In its initial notice of proposed

rulemaking, the Department certified

that the proposed revisions would not

have a significant effect on a substantial

number of small businesses. 62 FR

3371–73 (Jan. 22, 1997). The

Department’s certification was criticized

by both the coal mining industry and

the Small Business Administration’s

Office of Advocacy. Industry argued that

the Department had grossly

underestimated the effect of the

proposed rule. The Office of Advocacy

observed that the Department had not

used the size standards established by

the Small Business Administration, and

that the Department did not provide a

factual basis for its certification. In

particular, the Office of Advocacy took

issue with the Department’s

interpretation of the term ‘‘significant

economic impact.’’

In light of the comments the

Department received in response to the

first notice of proposed rulemaking, the

Department included in its second

notice of proposed rulemaking an initial

regulatory flexibility analysis. That

analysis included each of the

components identified by the RFA: (1)

A statement of the reasons for issuing

the proposed rule; (2) a statement of the

objectives of, and legal basis for, the

proposed rule; (3) a description and,

where feasible, an estimate of the

number of small businesses to which

the rule would apply; (4) a description

of projected reporting, recordkeeping,

and other compliance requirements of

the proposed rule; and (5) an

identification of any rules that would

overlap, duplicate, or conflict with the

proposed rule. 5 U.S.C. 603(b). Finally,

as is also required by the RFA, the

analysis contained a description of

alternatives to the rule. 5 U.S.C. 603(c).

64 FR 55006–09 (Oct. 8, 1999).

The Regulatory Flexibility Act

‘‘plainly does not require economic

analysis.’’ Alenco Communications, Inc.

v. FCC, 201 F.3d 608, 625 (5th Cir.

2000). Because of the serious concerns

raised in the comments to its initial

notice of proposed rulemaking,

however, the Department undertook an

extensive analysis of the effect of its

proposed rule on the coal mining

industry in general and on small

businesses, as defined by the Small

Business Administration, in particular.

Rulemaking Record, Exhibit 80. That

analysis determined that the potential

costs of the Department’s rule would be

imposed on most coal mine operators

through higher insurance premiums,

and that, in the long term, those

insurance premiums could be expected

to rise by 39.3 percent. Exhibit 80 at p.

44. The analysis assumed that all coal

mine operators purchased insurance to

cover their obligations, although it

noted that this assumption probably

overstated costs with respect to

operators that are authorized to selfinsure. Logically, operators self-insure

only if they may do so at a lower cost.

Exhibit 80 at p. 44. The analysis

calculated that an increase in premiums

of this magnitude would result in a total

annual cost to the industry between

$32.22 million and $88.32 million, with

a point estimate of $57.56 million.

Exhibit 80 at p. 46. The Department

believes that these figures contain

substantial upward biases, and that they

therefore overstate, by a considerable

amount, the total cost to industry.

Specifically, the Department estimated

the costs based on the insurance

premiums paid by underground coal

mine operators. The insurance

premiums paid by surface mine

operators, which employ a substantial

percentage of the people working in coal

mine employment, are significantly

lower. (See the economic analysis

prepared by Milliman & Robertson, Inc.,

at p. 6, Table 4; Rulemaking Record

Exhibit 89–37, Appendix A.) In

addition, coal mine operators who selfinsure their liabilities under the Black

Lung Benefits Act may be assumed to do

so because their costs are lower than the

costs of commercial insurance.

Although it is conservatively high, the

Department believes the $57.56 million

point estimate to be the most useful

indicator of industry costs. The analysis

concluded that the effects of this rise in

insurance costs would be most heavily

felt by underground bituminous coal

mine operators with less than 20

employees, who would be in a poorer

position to recoup those costs. Some of

those operators, the analysis observed,

might be forced to suspend operations.

Exhibit 80 at pp. 56–59.

The RFA also requires that agencies

assure that small businesses have an

opportunity to participate in the

rulemaking ‘‘through the reasonable use

of techniques such as—* * * 3) the

direct notification of interested small

entities; * * *’’ 5 U.S.C. 609(a)(3).

Accordingly, the Department mailed a

copy of its second notice of proposed

rulemaking, including its initial

regulatory flexibility analysis, to each

coal mine operator identified in a

database maintained by the Mine Safety

and Health Administration. In addition,

the Department made a copy of its

economic analysis available to any

interested party that requested it and

posted it on the Internet. 64 FR 55008

(Oct. 8, 1999). Finally, because the

Department did not complete its mailing

of the proposal until November 5, 1999,

it extended the comment period through

January 6, 2000 to ensure that each

small business was given no less than

60 days to submit comments, the length

of the original comment period in the

second notice of proposed rulemaking.

64 FR 62997 (Nov. 18, 1999).

Finally, the Regulatory Flexibility Act

requires that when an agency

promulgates a final rule after having

been required to publish a notice of

proposed rulemaking, the agency must

prepare a final regulatory flexibility

analysis. That analysis must contain:

(1) a succinct statement of the need

for, and objectives of, the rule;

(2) a summary of the significant issues

raised by the public comments in

response to the initial regulatory

flexibility analysis, a summary of the

assessment of the agency of such issues,

and a statement of any changes made in

the proposed rule as a result of such

comments;

(3) a description of and an estimate of

the number of small entities to which

the rule will apply or an explanation of

why no such estimate is available;

(4) a description of the projected

reporting, recordkeeping and other

compliance requirements of the rule,

including an estimate of the classes of

small entities which will be subject to

the requirement and the type of

professional skills necessary for

preparation of the report or record; and

(5) a description of the steps the

agency has taken to minimize the

significant economic impact on small

entities consistent with the stated

objectives of applicable statutes,

including a statement of the factual,

policy, and legal reasons for selecting

the alternative adopted in the final rule

and why each one of the other

significant alternatives to the rule

considered by the agency which affect

the impact on small entities was

rejected.

5 U.S.C. 604(a). The agency must make

a copy of its final regulatory flexibility

analysis available to the public, and

must publish its analysis or a summary

of its analysis in the Federal Register.

5 U.S.C. 604(b). The Department’s final

regulatory flexibility analysis is

published below.

Need for, and Objectives of, the Rule

The Department discussed its need to

revise the black lung regulations in its

initial regulatory flexibility analysis. 64

FR 55006–07 (Oct. 8, 1999). In that

analysis, the Department observed that

the revisions satisfied a number of

different objectives. First, many of the

revisions simply updated the

regulations implementing the Black

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80031

Lung Benefits Act. The Department’s

initial analysis provided examples of

much needed regulatory updates such

as those needed to reflect decisions of

the courts of appeals and to clarify the

Department’s original intent when

certain regulations were promulgated.

Similarly, the Department noted the

proposed regulatory revisions reflected

changes that had occurred over the

previous 20 years in the diagnosis and

treatment of pneumoconiosis.

Paragraphs (1), (3), (4), and (6) of the

section entitled ‘‘Reasons for, and

Objectives of, the Proposed Rule,’’

discussed areas in which the

Department sought to update its

regulations.

The black lung program regulations

were in need of significant revision to

make them current. The Department last

made substantive revisions to certain

regulations in 1983, see 48 FR 24272

(May 31, 1983), and those revisions

reflected only substantive changes made

to the Black Lung Benefits Act by the

Black Lung Benefits Revenue Act of

1981, Pub. L. 97–119, Title I, 95 Stat.

1635 (1981) and the Black Lung Benefits

Amendments of 1981, Pub. L. 97–119,

Title II, 95 Stat. 1644 (1981), both of

which became effective on January 1,

1982. Most of the regulations have not

been revised since they were originally

promulgated: Part 718 in 1980, Part 722

in 1973, and Parts 725 and 727 in 1978.

See 45 FR 13678 (Feb. 29, 1980); 38 FR

8328 (March 30, 1973); 43 FR 36772

(Aug. 18, 1978). Some regulations,

however, did not reflect the

amendments to the Black Lung Benefits

Act enacted over the last quarter

century. For example, Part 722 sets forth

criteria states must meet when seeking

certification from the Secretary that

their workers’ compensation programs

provide ‘‘adequate coverage’’ for

occupational pneumoconiosis. These

regulations were never revised in light

of either the Black Lung Benefits Reform

Act of 1977, Pub. L. 95–239, 92 Stat. 95

(1978), or the Black Lung Benefits

Amendments of 1981. Similarly, the

Secretary’s Part 725 regulations required

revision in order to reflect amendments

to other statutes. For example, revised

§ 725.621 reflected the Debt Collection

Improvement Act of 1996, Pub. L. 104–

334, 110 Stat. 1358 (1996), see preamble

to first notice of proposed rulemaking,

§ 725.621, 62 FR 3369 (Jan. 22, 1997).

Section 725.515 was revised to reflect

amendments to the Social Security Act,

see preamble to second notice of

proposed rulemaking, § 725.515, 64 FR

55001 (Oct. 8, 1999). Section 725.544

was amended to reflect the statutory

increase in the dollar amount of claims

which may be compromised by the

United States and to reflect the repeal of

the Federal Claims Collection Act, see

preamble to second notice of proposed

rulemaking, § 725.544, 64 FR 55002

(Oct. 8, 1999).

In addition, over the last two decades,

many of the regulations in Parts 718 and

725 have been interpreted by both the

Benefits Review Board and the federal

appellate courts. The Department

strongly believes that, where these

interpretations represent a consensus of

opinion as to the meaning and correct

application of particular regulations,

that consensus should be embodied in

the Department’s regulations. One

commenter correctly observes that none

of these courts specifically ordered the

Department to revise its regulations. The

Department believes, however, that the

interests of all parties to the

adjudication of a claim—coal mine

operators and their insurers as well as

claimants—will be better served if a

judicial consensus is reflected in the

explicit language of the Department’s

regulations. Incorporating such a

consensus will allow both the parties

and the adjudication officer to use a

current version of the regulation that

does not require constant recourse to

databases of federal case law. Moreover,

the black lung program serves a

population of applicants—individuals

who spent their working lives in the

Nation’s coal mines—who cannot be

expected to be aware of all of the

judicial decisions bearing on their

eligibility for benefits, and who thus

cannot be expected to bring them to the

attention of the administrative law

judges who conduct formal hearings on

applications for benefits under the Act.

For example, the substantive criteria

governing a claimant’s eligibility for

benefits, set forth in Part 718, have been

the subject of numerous appellate

decisions. The Department’s preamble

discussion of § 718.201 contains

citations to a considerable body of case

law recognizing that pneumoconiosis, as

defined by the Act and the Department’s

regulations, includes obstructive lung

disease arising from coal mine dust

exposure. Similarly, the preamble

discussion of § 725.309 references those

decisions noting that pneumoconiosis is

a latent, progressive disease. See

preamble to § 718.201, paragraph (f),

preamble to § 725.309, paragraph (b).

The Department’s revised definition of

‘‘pneumoconiosis’’ in § 718.201

explicitly incorporates both of these

principles. The Department’s revisions

of §§ 718.204 (criteria for establishing

that a miner suffers from total disability

due to pneumoconiosis) and 718.205

(criteria for establishing that a miner

died due to pneumoconiosis) codify

nearly unanimous case law interpreting

the Department’s prior regulations. See

preamble to § 718.204, paragraph (d),

explaining that the definition of ‘‘total

disability’’ requires proof of a totally

disabling respiratory or pulmonary

impairment, preamble to § 718.205,

paragraph (d), providing practical

meaning to the regulatory standard that

death is due to pneumoconiosis when

pneumoconiosis is a substantially

contributing cause of death; see also 62

FR 3345 (Jan. 22, 1997) (citing cases

defining when total disability is due to

pneumoconiosis under 20 CFR 718.204

(1999)). Similarly, revised sections

725.309, governing subsequent claims

filed by the same individual, and

725.310, governing requests for

modification of a claim, reflect a body

of decisional law that has developed

since these regulations were

promulgated in 1978. See preamble

discussions of § 725.309, 62 FR 3351–52

(Jan. 22, 1997), 64 FR 54984–85 (Oct. 8,

1999), and above; and preamble

discussions of § 725.310, 62 FR 3353–54

(Jan. 22, 1997), 64 FR 54985–86 (Oct. 8,

1999), and above.

The Department also believes that,

where the Board or the appellate courts

have identified issues which the

regulations do not adequately address,

regulatory action is appropriate to

correct that omission. Thus, section

725.495 addresses a problem observed

by the Fourth Circuit Court of Appeals

in Director, OWCP v. Trace Fork Coal

Co., 67 F.3d 503, 507 (4th Cir. 1995),

viz., 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.’’ Similarly, where the Board or

the appellate courts have interpreted a

regulation in a manner different from

that intended by the Department, the

only way to ensure that the

Department’s intent is fulfilled is to

amend the regulations. See, e.g.,

preamble to first notice of proposed

rulemaking, § 718.101, 62 FR 3341 (Jan.

22, 1997) (noting intent that standards

for ensuring the quality of medical

evidence be made uniformly applicable

to all new evidence developed in the

claims adjudication process).

Finally, in order to update its

regulations, the Department also needed

to revise certain provisions in light of its

experience administering the program

for over 25 years. This experience had

demonstrated that the regulations did

not adequately address certain issues.

For example, the former regulations

provided little guidance as to when a

claimant could reasonably expect the

payment of monthly and retroactive

80032 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

benefits from coal mine operators, see

preamble to first notice of proposed

rulemaking, § 725.502, 62 FR 3365–66

(Jan. 22, 1997). Similarly, the

Department had learned that the rules

governing overpayments and their

possible waiver varied depending on

whether the overpayment was made by

the Black Lung Disability Trust Fund or

a coal mine operator, see preamble to

first notice of proposed rulemaking,

§ 725.547, 62 FR 3366 (Jan. 22, 1997).

In addition to making its regulations

current, the Department intended to

revise its regulations to streamline the

adjudication of claims under the Act. 62

FR 3338 (Jan. 22, 1997). The Department

felt this need was critical and hoped to

ensure that the resulting process for

determining a claimant’s eligibility was

both simple and equitable. For example,

the Department had been widely

criticized for delays in the adjudication

process. In response, the Department

has made considerable changes in the

initial processing of claims. The

Department’s revisions begin with the

manner in which each miner who files

an application for benefits is afforded a

complete pulmonary evaluation, see 30

U.S.C. 923(b). The Department’s

revisions will allow each miner to select

a highly qualified physician to perform

his evaluation from a list of authorized

providers maintained by the

Department. See preamble discussion of

§ 725.406, 64 FR 54988–90 (Oct. 8,

1999). The Department hopes thereby to

provide each claimant with a realistic

appraisal of his condition and to

provide each claim with a sound

evidentiary basis. The regulations

governing the additional development

and submission of evidence will ensure

that the parties to a claim receive fewer

documents to which they need to file a

response than was formerly the case.

Thus, rather than issue initial findings

and a memorandum of conference,

formerly provided for in the regulations

(20 CFR 725.410, 725.411, 725.417

(1999)), the district director will issue

only one decisional document at the

conclusion of his processing: a proposed

decision and order. See preamble

discussion of §§ 725.410–725.413. In

addition, the revised regulations will

allow the Department to generate

documents that provide a clearer and

better reasoned explanation of any

evidentiary evaluation made by the

district director and a better

understanding by the parties of their

rights and responsibilities. Thus, the

district director will issue a schedule for

the submission of additional evidence

which explains his preliminary analysis

of the results of the miner’s complete

pulmonary evaluation. It will notify all

parties of their right to submit

additional evidence and to obtain

further adjudication of the claim. See

preamble discussion of §§ 725.410–

725.413. One of the most important

revisions made by the Department will

limit the parties’ submission of

documentary medical evidence. This

revision will require that the factfinder

evaluate a claimant’s eligibility based on

the quality of medical evidence that the

parties submit, rather than the

numerical superiority of the evidence

on either side. See preamble discussion

of § 725.414, 64 FR 54994 (Oct. 8, 1999);

62 FR 3356–57 (Jan. 22, 1997).

Significant Issues Raised by Public

Comments in Response to Initial

Regulatory Flexibility Analysis

The comments in response to the

Department’s initial regulatory

flexibility analysis fall into three

categories: (1) Those comments urging

the Department not to promulgate

regulations having any adverse

economic effect on the coal mining

industry, or on one or more segments of

that industry; (2) comments contending

that the assumptions underlying the

economic analysis on which the

Department’s initial regulatory

flexibility analysis was based were

flawed, and that the analysis thus

underestimates the effect on small

businesses subject to regulation by the

rule; and (3) comments suggesting

regulatory alternatives that the

Department allegedly failed to consider

in its initial regulatory flexibility

analysis. The Department discusses

those comments suggesting regulatory

alternatives below, in the section

entitled ‘‘Description of Steps the

Agency has taken to Minimize the

Impact on Small Entities Consistent

with the Stated Objectives of Applicable

Statutes.’’ The Department responds to

comments in the first two categories in

this section.

Several commenters argue that, in

light of the costs identified by the

Department in its initial regulatory

flexibility analysis, the Department

should not promulgate any revised

regulations. The Department disagrees.

The regulations implementing the Black

Lung Benefits Act are badly in need of

revision to reflect more than two

decades of judicial interpretation and

administrative experience. In addition,

the Department believes that the process

used to determine a claimant’s

eligibility for benefits, and an operator’s

liability for those benefits, needs to be

made faster, fairer, and more credible.

No parties have benefitted from the

delays that the courts of appeals have

identified in the program, see, e.g.,

Venicassa v. Consolidation Coal Co.,

137 F.3d 197, 198 n.2 (3d Cir. 1998)

(noting ‘‘a disturbing record of delay in

processing claims for black lung benefits

in prior cases’’). The Department’s

regulations are intended to eliminate

that delay by, inter alia, reducing the

number of steps in the district director’s

processing of a claim, requiring the

timely development of evidence

relevant to the issue of operator liability

and eliminating the possibility of

remands from the Office of

Administrative Law Judges for the

development of additional evidence as

to the identity of the liable party. The

Department’s revised regulations

promote fairness and credibility in

claims adjudications by providing each

miner with a quality medical evaluation

of his pulmonary condition when he

first applies, by explaining the

Department’s initial assessment of that

evidence and by informing all parties of

their rights to submit additional

evidence and to request further

adjudication of the claim.

One comment suggests that ‘‘a

reasonable interpretation of the

Department’s own economic analysis

leads to the inescapable conclusion that

the proposed rule will have a significant

economic impact on a substantial

number of small entities.’’ Rulemaking

Record, Exhibit 89–37, p. 24. The

Department does not disagree. 64 FR

55008 (Oct. 8, 1999). The Department

recognized that the rule will have an

economic impact on the coal mining

industry, and in particular on

underground bituminous coal mine

operators that employ less than 20

people. It is for this reason that in its

second notice of proposed rulemaking,

the Department prepared an initial

regulatory flexibility analysis in lieu of

its prior certification that the proposed

rule would not have a significant

economic impact on a substantial

number of small entities. 64 FR 55006

(Oct. 8, 1999). The existence of an

economic impact, however, does not

mean that the Department is foreclosed

from promulgating its rule. In

Associated Fisheries, the First Circuit

quoted with approval from the

Commerce Department’s explanation of

its responsibilities under the Regulatory

Flexibility Act:

The intent of the RFA is not to limit

regulations having adverse economic impacts

on small entities, rather the intent is to have

the agency focus special attention on the

impacts its proposed actions would have on

small entities, to disclose to the public which

alternatives it considered to lessen adverse

impacts, to require the agency to consider

public comments on impacts and

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80033

alternatives, and to require the agency to

state its reasons for not adopting an

alternative having less of an adverse impact

on small entities.

127 F.3d at 115–116. The Regulatory

Flexibility Act thus vests the

Department with the responsibility for

determining, in light of the recognized

costs, whether the rule should

nevertheless be promulgated.

The economic analysis performed in

connection with the Department’s initial

regulatory flexibility analysis described

the costs that the rule would impose on

the coal mining industry. That analysis

was based on a number of conservative

assumptions that were designed to

establish a cost ceiling, i.e., the

maximum additional costs that industry

would face as a result of these rules. For

example, the analysis assumed that all

coal mine operators purchase

commercial insurance. The Department

did not attempt, however, to estimate

precisely the number of mines which

would close as a result of these

increased costs. Instead, the Department

concluded that there was only a

significant potential for closures in the

very smallest size class of underground

bituminous coal mine, those with under

20 employees. Rulemaking Record,

Exhibit 80, Exhibits O and Q. These

mines will feel the greatest effect of the

Department’s rule largely because of

their operating characteristics. As a

group, very small coal mines are far

more labor intensive (i.e., much less

mechanized) than larger coal mines.

Because the rule will raise costs in the

form of higher insurance premiums,

which in turn are based on each mine’s

payroll, increased premiums will

represent a substantially higher cost

increase per ton of coal mined for a very

small mine than for a larger mine. Thus,

based on its preliminary economic

analysis (Rulemaking Record, Exhibit

80, pp. 46–51), the Department found

that larger mines—including many

mines that meet the definition of a

‘‘small’’ business under the definition

used by the Small Business

Administration—would not face

significant impacts from the rule in

terms of closures.

In addition to being more labor

intensive, very small underground

mines also incur the higher insurance

premiums associated with underground

coal mining. Data contained in

comments received by the Department

indicate that surface bituminous coal

mine insurance rates average $1.57, only

59 percent of the average underground

mine insurance rate of $2.64. Similarly,

surface mine rates average only 53

percent of underground rates for eastern

bituminous mines; and 37 percent of

underground rates for a four-state

average of Pennsylvania, Kentucky,

Virginia, and West Virginia. For

anthracite coal, surface mine insurance

rates are only 44 percent of

underground mine insurance rates.

Rulemaking Record, Exhibit 89–37,

Appendix A, Table 4. Any increase in

insurance rates, then, assuming that all

other things are equal, will affect the

price per ton of underground coal twice

as much as it will the price of coal

extracted from surface mines. This

distinction renders very small

underground coal mines potentially

vulnerable to closures in a way that very

small surface coal mines are not.

Because the insurance rates for surface

anthracite mines are also high, very

small anthracite strip mines may also be

potentially vulnerable to closure.

Additional data provided by

commenters, as well as data that has

become available from the Department

of Energy since publication of the

Department’s initial regulatory

flexibility analysis, allow the

Department to forecast the number of

potential mine closures in somewhat

greater detail. This analysis confirms the

Department’s preliminary conclusion

that, although the regulations will have

a significant impact on some mines, the

impact on the mining industry as a

whole will not be substantial. The

Department’s additional analysis

therefore provides no basis to reconsider

the decision to promulgate final

regulations.

Mine Safety and Health

Administration data are useful in

establishing the number of mines that

are potentially at risk of closure. The

Department emphasizes, however, that

this data addresses only the mines that

are potentially at risk of closure because

of the Department’s rulemaking. The

actual effects of the rule can be

determined only by establishing the

‘‘base case’’ of mines that could be

expected to close even if the Department

does not promulgate its final rule. In

1998, 1,609 mines produced bituminous

coal. An additional 743 bituminous

mines are listed in the MSHA data but

produced no coal during 1998. Of the

1,609 producing mines, 791 were

underground mines, and 263 of the

underground mines had fewer than 20

employees. Of these 263 mines, 37

produced over 100,000 short tons of

coal in 1998. Because mines with fewer

than 20 employees that produced over

100,000 short tons have high labor

productivity, the Department does not

believe that they will be significantly

impacted by a rule whose primary

effects are felt through increased

insurance premiums that are based on

labor costs. Subtracting these 37 mines

from the 263 very small underground

mines leaves 226 mines. The mines are

located in Kentucky (81 mines), West

Virginia (71 mines), Virginia (52 mines),

Pennsylvania (14 mines), Tennessee (5

mines), and Alabama (3 mines). These

mines are extremely small, employing a

total of only 2,586 people. Median 1998

employment per mine was 11; mean

employment was 11.4. Median

production was 25,957 short tons of

coal; mean production was 34,273 short

tons.

The Department’s previous economic

analysis demonstrated that very small

underground mines with first quartile

accounting profits (the one-quarter of

these mines with lowest profits) might

be forced to close as a result of the rule,

but that mines with median accounting

profits were not in such jeopardy. For

purposes of estimating the potential

number of mine closures, however, the

Department will assume that as many as

three-eighths of these mines (the halfway point between .25, representing the

first quartile, and .5, representing the

second) are at risk. Multiplying this

figure (.375) by the total number of very

small underground bituminous mines

(226) yields a total of 85 mines.

According to MSHA data, these 85

underground bituminous mines

represent 5.3 percent of all producing

bituminous coal mines, employed 1.3

percent of the miners engaged in

bituminous coal mine employment, and

accounted for 0.3 percent of bituminous

coal production.

MSHA data indicate that 117 mines

produced anthracite in 1998. An

additional 87 anthracite mines are listed

in the MSHA data but produced no coal

during 1998. Of the 117 producing

mines, 60 were strip mines, 39 were

underground mines, and 18 were culm

bank/refuse pile operations. Of the 117

mines, 12 (10 strip mines, 1

underground mine, and 1 culm bank

operation) had 20 or more employees,

and only 3 had more than 50 employees.

An additional 6 mines (3 strip mines

and 3 culm bank operations) produced

over 100,000 short tons in 1998. Culm

bank operations and mines with 20 or

more employees or over 100,000 tons

output do not appear to be at risk of

closure. Culm banks are discussed in

detail below in response to a comment

regarding the Department’s assumptions

about price elasticity. Thus, the

population of very small anthracite

mines consists of 85 mines. This total

includes 47 strip mines (60 total strip

mines minus 10 strip mines with 20 or

more employees minus 3 strip mines

that produced more than 100,000 short

tons of coal in 1998) and 38

80034 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

underground mines (39 underground

mines minus 1 mine with 20 or more

employees). These mines are extremely

small. They had a total of 411

employees (220 in strip mines and 191

in underground mines). Median 1998

employment was 3; mean employment

was 4.8. Median production of these

anthracite mines was 4,500 short tons

(7,484 for strip mines and 2,598 for

underground mines); mean production

was 12,173 short tons (17,116 for strip

mines and 6,060 for underground

mines).

Profit data for anthracite mines are

not available. It appears reasonable to

assume, however, that very small

anthracite strip mines will be

potentially subject to closure because

their insurance premiums are high, and

that very small underground anthracite

mines will be even more heavily

impacted. The Department will

therefore assume that three-eighths of

very small anthracite strip mines (the

same figure used for bituminous mines)

and five-eighths of very small anthracite

underground mines (a higher figure to

take into account the possibility of a

heavier impact on these mines) are

potentially in jeopardy of closure

because of costs of the rule. Thus, an

estimated 42 very small anthracite

mines (18 strip mines (.375 times 47

mines) and 24 underground mines (.625

times 38 mines)) are potentially in

jeopardy of closing as a result of the

rule.

The next step in forecasting the

number of mines that may close as a

result of the rule is establishing the

‘‘base case,’’ i.e., the number of mines

that would close regardless of whether

the Department promulgated new

regulations. This is particularly

important for an industry such as coal

mining, where the number of small

mines has been declining for decades,

and where a continued sharp decline is

likely in the foreseeable future. Only

after establishing the base case can the

Department estimate the extent to which

the rule may result in additional

closures.

The current and predicted decline in

the number of small coal mines is the

result of a variety of market factors.

They include electricity deregulation,

reduction in coal reserves, the use of ontime delivery by coal company

customers, equipment upgrades,

increased use of low sulfate coals, and

the reduction in the number of small

mining firms due to industry

consolidation over the last two decades.

All of these factors put very small coal

mines, particularly underground mines,

in an increasingly disadvantageous

competitive position. Because of their

size, very small coal mines have

difficulty increasing productivity. They

lack the physical scale to take advantage

of new, high-productivity equipment,

most of which is very large, or to adopt

more productive techniques, such as

continuous miner operations or

longwall mining. Restricted space, of

course, is a greater constraint in

underground coal mines than surface

mines.

Many very small coal mines are also

characterized by unfavorable geological

conditions. These may include thin coal

veins, splitting coal beds, fractures or

offsets due to faulting, interruptions in

coal deposits or coal quality due to

sandstone-or clay-filled channels, and

unstable roof rock. Such geologic

conditions may well be the reason the

mine is small to begin with. They also

make it costly to extract coal and

difficult to improve productivity. Mines

with such geological problems are

therefore especially vulnerable to price

competition. The economic suitability

of coal beds for mining is reflected in

changes in committed active reserves as

the price of coal changes. Culling

reserves to eliminate hard-to-mine

reserves, or ‘‘high-grading’’ of reserve

blocks, is a logical adaptation to low

coal prices. From 1991 to 1996, as coal

prices fell, the reserves of small mines

(annual production of 10,000 to 100,000

short tons) fell by 61.6 percent,

compared with a 12.9 percent decline

for the coal mining industry as a whole.

U.S. Department of Energy, Energy

Information Administration, ‘‘The U.S.

Coal Industry in the 1990’s: Low Prices

and Record Production,’’ (October,

1999) p. 6 (hereafter, ‘‘U.S. Coal

Industry’’).

In addition, the shift in demand to

low-sulfur western coal, which has

occurred in response to the Clean Air

Act Amendments of 1990 and the

resulting regulations of the

Environmental Protection Agency, puts

very small coal mines at a severe

disadvantage. Very small coal mines are

concentrated in areas where coal has a

relatively high sulfur content. Lowsulfur coal is found predominantly in

the west, particularly in the Powder

River Basin. The large strip mines that

produce low sulfur coal have easy

geology (thin overburden and thick coal

beds), and their large scale results in

labor productivity approximately three

times as high as that of eastern mines.

This productivity differential continues

to grow. Moreover, recent investments

in track by western railroads are further

lowering the power-plant price of

Powder River Basin coal.

Finally, many very small coal mines

have management that may not be well

equipped with tools such as computers.

Such mines are in a poor position to

adapt to practices such as on-time

delivery or to utilize other risk

management techniques that utility

deregulation is making increasingly

important in coal mine operation.

Independent very small coal mines are

also, by virtue of their size, in a

relatively poor position to participate in

strategic inter-fuel alliances, an

increasingly common result of utility

deregulation.

Because of all of these market factors,

the outlook for independent very small

mines is extremely bleak. The

Department’s preliminary economic

analysis, in fact, was based on the

observation that the base case already

includes extensive closures of very

small mines. Over the last 15 or 20

years, the market forces discussed above

have eliminated a large majority of very

small mines. Data collected by the

Energy Information Administration

(EIA) indicate that in the 11 years

between 1986 and 1997 the number of

coal mines with annual production of

less than 10,000 short tons decreased

from 1,069 to 281 (a total of 74 percent),

while production of mines of this size

decreased from 4.4 million short tons to

1.2 million tons, or by 73 percent. In the

same period, the number of coal mines

with annual production of 10,000 to

100,000 short tons decreased from 1,956

to 638 (a 67 percent decrease), while

production of mines of this size

decreased from 82.8 million short tons

to 27.8 million short tons, or by 66

percent. EIA, U.S. Coal Industry, p. 3,

Table 1.

To estimate both baseline closures

and closures that may be considered

impacts of the rule, two regression

models were created using EIA data for

1986 through 1998. Both used the log of

the number of underground bituminous

coal mines with production in the range

of 10,000 to 99,999 short tons. Both

models used the log of the national

price of coal as an independent variable,

and one also included time as an

independent variable. Both models had

high statistical significance by any

measure. Using EIA projections of coal

price changes (see Department of

Energy, Energy Information

Administration, ‘‘Challenges of Electric

Power Industry Restructuring for Fuel

Suppliers’’ (September 1998) (hereafter,

‘‘Challenges,’’), Table ES1, p. 13), the

models were used to forecast the

percentage decrease in the number of

coal mines in the base case in the years

2005 and 2015, and the decreases that

may result from the Department’s rule

during the same interval.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80035

The log-log model with no time

variable predicted a baseline decrease in

underground bituminous mines of 32

percent from the year 1998 to the year

2005 and a baseline decrease in

underground bituminous mines of 61

percent from 1998 to 2015. Of the 85

bituminous mines identified as in

jeopardy of closure, therefore, this

model forecast that 27 would close by

2005 and 52 would close by 2015, even

without the costs of the rule. When

costs of the rule for the very small class

of mines was added, the predicted

decreases in the number of mines were

39 percent (or 33 mines) between 1998

and 2005 and 66 percent (or 56 mines)

between 1998 and 2015. Thus the model

predicts that the costs of the rule would

result in the additional closure of 6

mines (33 mines minus 27 mines) as of

2005 but only 4 more mine closures (56

mines minus 52 mines) than the

baseline as of 2015.

The model with a time variable

predicted much sharper baseline

decreases in the number of mines (43

percent decrease by 2005 and 86 percent

by 2015) and impacts of the rule of

about 0.4 mine closures by both years.

It should also be noted that, because

complete data were not available,

neither model included mines

producing less than 10,000 short tons,

which have been closing at a faster rate

than the mines that were included in

the model. Thus, use of results from the

model without a time variable

represents a conservatively low choice

of estimate of baseline closures.

A similar procedure was used for

anthracite mines, with some

modifications. Separate models were

estimated for underground mines and

strip mines, but total mines were used

for the dependent variable. The log-log

form without a time variable is reported.

For the 24 at-risk underground

anthracite mines, the model forecasts a

base-case decrease in the number of

mines of 21 percent as of 2005 (5 mines)

and 43 percent as of 2015 (10 mines).

Considering the additional costs

imposed by the rule, the forecasts were

decreases of 29 percent as of 2005 (1.92

additional mines) and 48 percent as of

2015 (1.2 additional mines). For the 18

at-risk surface anthracite mines, the

model forecasts a base-case decrease in

the number of mines of 8 percent as of

2005 (1 mine) and 20 percent as of 2015

(4 mines). Considering the additional

costs imposed by the rule, the forecasts

were decreases of 10 percent as of 2005

(.36 additional mines) and 21 percent as

of 2015 (.18 additional mines).

The Regulatory Flexibility Act does

not require the Department to

extrapolate its projection of the cost of

its rulemaking activity in order to

determine the rule’s collateral effects,

i.e., the extent to which the mining

industry will absorb the costs of

compliance by reducing either

employment or output. It is possible,

however, to make a rough estimate of

these effects. The number of

incremental closures of bituminous

mines due to the rule (rather than the

base case), was projected to be 6 mines

as of 2005 and 4 mines as of 2015. This

conclusion is consistent with the

Department’s previous analysis, which

observed that the largest impact of the

rule would be to close some mines

sooner than they would have closed in

the base case. Estimated employment

impacts related to closures would be 70

jobs as of 2005 and 45 jobs as of 2015.

Estimated production impacts related to

closures would be 208,880 short tons of

bituminous coal annually as of 2005 and

133,736 short tons as of 2015. Since the

mines which may close presumably

have relatively low productivity, the

overall effect would be to raise industry

productivity. The estimated level of

impacts—about one-eighth of the

baseline closure rate as of 2005 and one

tenth the baseline closure rate as of

2015—is much too small to have a

meaningful impact on the competitive

structure of the industry.

The Department projected the number

of incremental closures of anthracite

mines due to the rule (rather than the

base case) to be 2.28 mines as of 2005

and 1.38 mines as of 2015. Under this

projection, the estimated maximum

employment loss related to closures

would be 10 jobs as of 2005 and 7 jobs

as of 2015. This projected job loss

assumes that no additional jobs are

created elsewhere in the anthracite

industry. Estimated production loss

related to closures would be 14,564

short tons of bituminous coal annually

as of 2005 and 11,058 short tons as of

2015. Since the mines which may close

presumably have relatively low

productivity, the overall effect would be

to raise industry productivity. Closure

of 1 or 2 mines is not expected to have

a meaningful impact on the competitive

structure of the industry.

It is also possible to assess the impact

of the rule on mining communities

using the counties in which such

operations are located. Very small

underground bituminous coal mines are

found in 46 counties. If closures are

randomly distributed, 22 of these

counties have less than a 5 percent

chance of any mine closure, 13 more

have less than a 20 percent chance, 5

more have less than a 30 percent

chance, and 3 more have less than a 50

percent chance of any mine closing.

Thus, each of the possibly affected

counties can expect to lose no more

than 6 jobs and have very little chance

of losing more than a dozen. Nearly half

(42 percent) of very small underground

bituminous coal mines are located in

three counties (in three separate states).

Of these counties, one can be expected

(as of 2005) to have one mine closure,

and the other two less than one mine

closure each. A majority (65 percent) of

anthracite underground and strip mines

are located in one Pennsylvania county.

This county can expect one mine

closure as a result of the rule, and the

other six counties with anthracite mines

can expect one closure of a very small

mine among them. Closure of one very

small anthracite mine would have an

impact of approximately 5 jobs. Overall,

then, only two counties are likely to

experience community impacts as great

as one very small mine closing in any

given year, and in neither of those

counties is the impact likely to be

greater than two very small mines

closing.

The nature of the rule also makes it

quite unlikely that there will be

significant impacts on coal mine

employment or output beyond those

instances where mines close. The

regulation has no direct effect on mining

operations. The principal effect of the

rule will be a very small increase in the

cost of labor. This increased cost

provides an incentive to substitute

capital for labor, and to increase labor

productivity and production generally

to provide a broader base over which to

spread the costs. This substitution, like

any other measure designed to increase

labor productivity, will enhance rather

than restrict improvements in

productivity. The Department’s analysis

already demonstrates a strong trend of

increasing productivity in the coal

mining industry, and any impacts of the

rule will simply reinforce this trend.

In addition, recent history and

available forecasts indicate that the use

of coal in generating electricity will

continue to increase. Any price passthrough will be small because the costs

of the rule are (for the industry as a

whole) not significant. There is no other

plausible mechanism (except for closure

of mines) by which the rule could

induce reductions in production.

Enhancement of productivity, for which

there are incentives, will tend to

increase production. Thus, aside from

mine closures, the rule will not have

adverse impacts on coal production.

Finally, there is a slight possibility

that the rule may result in a decreased

workforce in mines that continue to

operate. The principal mechanism for

such an impact is the incentive to

80036 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

substitute capital for labor. A number of

factors, however, make any such impact

minimal in its significance. Because the

costs of the rule are generally not

significant, the incentive itself will be

quite small. Increases in production will

tend to mitigate job loss. By itself, any

impact of the rule on employment is

almost certainly small enough to be

handled by attrition in an industry with

an annual labor turnover rate of

approximately 7 percent. Because the

base case trend toward labor saving

innovation in the coal mining industry

is so strong, any adverse effect on

employment will be a temporary

acceleration of job loss, rather than a net

long-term impact. Moreover, in the

current strong employment market, any

unemployment effects will generally be

transitory, so that their significance will

be minimal. For these reasons, aside

from mine closures, the rule will not

have significant adverse impacts on

employment.

The Department’s initial regulatory

flexibility analysis, as supplemented by

the additional study undertaken in the

final regulatory flexibility analysis,

demonstrates that the Department’s final

rule is being promulgated following

examination of the potential effects of

the rule on small coal mine operators.

The Regulatory Flexibility Act does not

dictate substantive results, or prevent

the Department from acting in such a

case. See A.M.L. International, Inc. v.

Daley, 107 F. Supp. 2d 90, 105 (D. Mass.

2000) (‘‘The intent of the RFA is not to

limit regulations having adverse

economic impacts on small entities.’’).

Because the Department believes that a

revision of the regulations

implementing the Black Lung Benefits

Act is long overdue, the Department has

decided to proceed with this final rule.

The Department also received

comments on its economic analysis. In

its initial regulatory flexibility analysis,

the Department specifically invited

comment on the assumptions used in

developing its economic analysis,

including the relationship between

increases in the claims approval rate

and increases in insurance premiums;

the relationship between increased

medical costs and increases in

insurance premiums; and the extent to

which promulgation of these revisions

will result in an increase in the number

of claims filed. 64 FR 55008 (Oct. 8,

1999). One of the comments received by

the Department, whose conclusions

were endorsed by a number of other

commenters, contained an economic

analysis by Milliman & Robertson, Inc.

(M&R). Rulemaking Record, Exhibit 89–

37, Appendix A.

As an initial matter, the M&R analysis

criticizes the assumption in the

Department’s economic analysis that the

approval rate for claims paid by

responsible operators and their insurers

under the revised regulations will not

exceed the approval rate for claims paid

by the Black Lung Disability Trust Fund

under the former regulations. The

Department’s economic analysis had

assumed that the overall approval rate

for responsible operator claims

(currently 7.33 percent) would not

exceed 12.18 percent, the overall

approval rate for Trust Fund claims.

Rulemaking Record, Exhibit 80, p. 38.

The M&R analysis states that ‘‘DOL has

offered no support for this assertion.’’

M&R at p. 17, see also Rulemaking

Record, Exhibit 89–37, pp. 31–32.

The Department’s analysis explicitly

stated, however, that ‘‘[t]he proposed

regulations represent the Department’s

past and current practice in Trust Fund

cases,’’ and that ‘‘several factors make

the Trust Fund approval rate

substantially higher than the

responsible operator approval rate.’’

Exhibit 80 at p. 38. These factors

include the age of applicants whose

claims are payable by the Trust Fund

and the fact that most of their exposure

to coal mine dust predated the 1969

federal dust standards. Thus, the

Department believes that the approval

rate for Trust Fund cases will remain

the same, and that the approval rate for

responsible operator cases will rise, but

not to the level of Trust Fund approvals.

The Department’s assumption is based

on its more than 15 years’ experience in

adjudicating claims for black lung

benefits under the prior regulations, and

its detailed knowledge of the

evidentiary showings required for those

claims’ approval.

The National Mining Association,

whose comment incorporates the M&R

analysis, suggests that the Department’s

revised definition of the term

‘‘pneumoconiosis’’ represents a

considerable departure from past

practice. Specifically, the commenter

takes issue with the Department’s

preliminary economic analysis which

refused to assign costs to the amended

definition of pneumoconiosis because

inclusion of chronic obstructive

pulmonary disease arising from coal

mine employment as pneumoconiosis

simply clarified the regulation and

made it consistent with past practice.

Rulemaking Record, Exhibit 89–37 at

29; Rulemaking Record, Exhibit 80 at

29. In the preamble to § 718.201, the

Department has cited 14 decisions from

six federal appellate courts with

jurisdiction over the vast majority of

claims filed under the Act (the Third,

Fourth, Sixth, Seventh, Eighth, and

Eleventh Circuits). These courts

recognize that pneumoconiosis, as it is

defined in the Act and was defined in

the prior regulations, includes

obstructive lung disease arising from

coal mine dust exposure. Similarly, in

the preamble to § 725.309, the

Department has cited 44 decisions from

seven federal appellate courts (the six

listed above plus the Tenth Circuit).

These courts recognize the progressive,

latent nature of pneumoconiosis. All of

these decisions reflect longstanding

positions of the Department. Because of

these positions, the Department has not

attempted to deny claims because the

miner’s disabling lung disease was

obstructive in nature, provided that

condition was shown to have arisen out

of coal mine employment, or because

the miner’s condition was alleged to

have progressed. The Department,

therefore, does not expect that any

additional Trust Fund claims will be

approved as a result of the revised

definition of pneumoconiosis. Similarly,

there is simply no reason to believe that

the revised definition of

pneumoconiosis will result in a higher

approval rate in responsible operator

claims than in Trust Fund claims.

The same commenter states that the

limitation on documentary medical

evidence tilts the playing field toward

claimants by allowing a claimant three

examinations (his choice of an approved

physician to conduct the complete

pulmonary evaluation plus two more) as

opposed to the operator’s two

examinations. The commenter argues

that this evidentiary imbalance will

increase the number of approved claims

payable by responsible operators.

Rulemaking Record, Exhibit 89–37, p.

29. Again, however, the Department’s

Trust Fund experience forms a

reasonable upper bound of the approval

rate expected under the revised

regulations. That experience

demonstrates that the Department

seldom develops more than two medical

reports in any individual claim for

which the Trust Fund is liable. In

addition, claimants under the former

regulations had the ability to choose any

physician to conduct their initial

evaluation, 20 CFR 725.406(a) (1999),

subject only to a district director’s

approval, which was seldom refused.

Claimants generally submitted no more

than one additional medical report in

support of their applications. Thus,

once again, the rate of Trust Fund

awards forms a reasonable upper

boundary of the approval rate expected

in responsible operator cases under the

revised regulations.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80037

Finally, the commenter argues that

the provision requiring that ‘‘controlling

weight’’ be given to the opinion of a

treating physician will result in

‘‘numerous’’ claims being approved that

previously would have been denied.

The Department does not accept this

assessment. The revisions to § 718.104

require only that an adjudication officer

evaluate certain criteria to determine

whether a treating physician may have

developed an in-depth knowledge of the

miner’s pulmonary condition. As the

Department has repeatedly emphasized,

the regulation does not require that the

adjudication officer credit the opinion

of the treating physician where there is

contrary evidence in the record. To the

contrary, the rule is designed to force a

careful and thorough assessment of the

treatment relationship. 64 FR 54976–77

(Oct. 8, 1999); see also preamble to

§ 718.104, paragraph (f). Accordingly,

the Department does not agree that this

revision will result in the approval of

‘‘numerous’’ additional claims. The

Department stands by its assumption in

the initial regulatory flexibility analysis

that any increase in the approval rate of

claims due to this regulation will be

‘‘very small.’’ Exhibit 80 at p. 34. The

Department reiterates that ‘‘[i]t is

difficult to see how this provision

would lead to an increase in approval of

weak or non-meritorious claims.’’

Exhibit 80 at p. 27. The commenter’s

assertions have thus failed to undermine

the Department’s assumption that the

approval rate for Trust Fund claims

represents an appropriate upper bound

for estimating the approval rate

applicable to operator claims under the

revised regulations.

The M&R analysis also arrives at a

higher overall approval rate for Trust

Fund claims (20 percent rather than

12.18 percent) by analyzing Trust Fund

claims involving only post-1981 coal

mine employment and by eliminating

claims filed by individuals with less

than 10 years of coal mine employment.

M&R at p. 17 n. 41. The Department

does not agree that manipulating the

data in this fashion produces a more

accurate result. First, responsible

operators are also liable for claims

involving pre-1982 coal mine

employment, so it is appropriate to

include that group. Second, exclusion of

all claims based on less than 10 years of

coal mine employment clearly will not

create a true picture of the overall

claims experience. A number of miners

who are employed in the mines for less

than 10 years ultimately are determined

to be eligible for benefits. Although the

M&R analysis includes claims filed by

such miners in determining the number

of approved claims, Transcript, Hearing

on Proposed Changes to the Black Lung

Program Regulations (July 22, 1997), p.

106 (testimony of Robert Briscoe), it

excludes denied claims filed by such

miners from the total number of filed

claims. In its prior analysis, M&R stated

that this exclusion was justified because

claims filed by miners with less than 10

years of coal mine employment will not

be ‘‘present in the population of coal

miners recently leaving the coal

workforce.’’ Rulemaking Record, Exhibit

5–160, Appendix 5, p. 28. The

Department’s database of claim filing

information, however, does not support

the inference that this group should not

be counted in determining the approval

rate for claims that are being filed

currently. Indeed, throughout the last

decade, claims filed by miners with less

than 10 years of coal mine employment

have represented approximately onequarter of the total number of

responsible operator claims. Because

these claims continue to represent a

significant number of responsible

operator claims, the Department

believes that both approved and denied

claims from this group should be

counted. Accordingly, the Department

does not agree that its approval rate

must be ‘‘corrected’’ by excluding these

claims.

The M&R analysis also exaggerates the

effect of the Department’s rule on

insurance rates. M&R criticizes the

Department because its analysis ‘‘fails to

test the current federal black lung

insurance rates being charged to

determine if they are a reasonable base

from which to project future cost

changes * * *.’’ M&R at p. 2. M&R

suggests, for example, that the rate in

Kentucky is ‘‘too low,’’ M&R at p. 7, and

concludes that the corrected rate for

underground bituminous mines, when

combined with the effects of the

Department’s regulatory revision, will

increase premiums by at least 1,075

percent. M&R at p. 8, Table 6. The

impact of the Department’s regulatory

revision, however, does not include the

correction of inadequate rates; such

correction must be factored in

independently, not assigned as a cost of

the regulations. Moreover, M&R states

that the premiums in the three other

large Eastern coal states (Pennsylvania,

Virginia, and West Virginia) are

‘‘redundant’’ (and rates are ‘‘generally

redundant in the other 23 coal mining

states), suggesting that insurance

companies (or in West Virginia’s case,

its state-administered fund) are making

excess profits from these markets. M&R

at p. 7. In this case, correcting

redundant rates should not be assigned

as a benefit of the revisions. In addition,

the insurance rates used by M&R, M&R

at p. 6, Table 4, whose source is not

identified, are generally lower than the

rates used by the Department by about

one percentage point (i.e., by $1.00 per

$100 of payroll). Because the

Department’s analysis of the rule’s cost

was based on a percentage increase of

existing rates, use of the M&R figures

would result in a substantially lower

estimate of total dollar costs. The

substantial difference between the

Department’s analysis of insurance rate

increases and M&R’s prediction derives

primarily from different assumptions

about the approval rate for claims filed

after the regulations go into effect.

Because the Department does not

believe that the approval rate for

responsible operator claims will exceed

the approval rate for Trust Fund claims,

the Department does not believe that

M&R’s predictions concerning insurance

rates are accurate. In any event,

insurance rate increases are subject to

approval by state authorities.

The Department also requested

comment on a possible increase in the

number of claims filed as a result of this

regulatory revision. The Department’s

economic analysis was based on the

assumption that, although the revisions

will not produce a significantly greater

number of approved claims,

expectations created by the mere

issuance of regulatory revisions will

cause a temporary increase in the

number of claims filed, an additional

3,440 responsible operator claims over a

two-year period. Rulemaking Record,

Exhibit 80, pp. 39, 42. The M&R

analysis did not specifically address this

assumption. Instead, the M&R analysis

is simply based on its own, wholly

different assumption regarding the

number of claims that are likely to be

filed once the revised regulations take

effect. M&R posits that ‘‘the application

of the reproposed regulations to the

large number of denied claims from all

past years will in effect rewrite the

history of approvals.’’ M&R, p. 21. M&R

uses an actuarial model to estimate the

‘‘number of ultimate claim filings that

are likely to be received’’ under the

former regulations and under the newly

revised regulations. M&R, p. 21. From

the data provided in Table 12 of the

M&R analysis, it appears that M&R

estimates that 2,567 additional claims

will be filed by miners whose last coal

mine employment was during the years

1982 to 1999. However, the Department

was unable to determine what

assumptions M&R made to generate this

estimate. In any case, M&R’s estimate

cannot be compared with the

80038 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Department’s, because M&R excludes

claimants with less than 10 years of coal

mine employment. The Department

believes that it is not necessary to

change the methodology used in the

initial regulatory flexibility analysis to

estimate the likely increase in claims

resulting from the revised regulations.

The Department also received

comments disputing its assumption that

coal mine operators could pass on to

coal consumers by price increases the

increased costs caused by the

Department’s rule. Rulemaking Record,

Exhibit 80, p. 52. The Department agrees

that it is difficult to determine with

precision the ability of small coal mine

operators to pass on costs to coal

consumers. Indeed, the Department

acknowledged in its initial economic

analysis that some small coal mine

operators would be unable to pass on

these costs, and that this inability might

represent the difference between being

able to continue mining operations and

suspending them. Interpreting current

profit rates that are unsustainably low or

negative, however, must be done

carefully, because there are two distinct

types of firms that may have such profit

rates at any one point in time. Some

firms may have such rates for a short

time, because of industry cycles or the

firm’s unique circumstances. These

firms will rebound and may or may not

experience significant impacts from a

regulation. Other firms will have

negative profits because they are already

in the process of failing.

These two cases have very different

implications in the analysis of the

economic impact of the Department’s

revisions. If a firm is in the process of

failing in any event, the impact of the

revised regulations will be small or nonexistent. At most, the impact will hasten

the firm’s failure by a short period of

time. Neither the failure itself, however,

nor any loss of jobs, should be

considered an impact of the regulations.

If a firm is about to rebound, the

situation is considerably more

complicated. The issue is whether the

firm will rebound to the level that it can

absorb the economic impact. It is

perfectly correct in such cases to say, as

one commenter points out, that

‘‘additional costs imposed by

regulations are certainly relevant since

the added cost of regulations will make

it that much more difficult for the firm

to achieve profitability.’’ Rulemaking

Record, Exhibit 89–37, p. 33. The

problem is that it is extremely difficult

to predict from a negative profit rate

how far a firm may rebound. One

reasonable assumption (given the very

limited data) is that a rebounding firm

will achieve median profits. If that is the

case, then, as the Department’s initial

analysis indicated, the firm will not fail

even given the economic impact of the

regulations. See Rulemaking Record,

Exhibit 80, Exhibit P.

The Department’s analysis, moreover,

is based on the assumption that coal

mine operators (other than culm-bank

operations, discussed below) will be

unable to pass through any of the costs

associated with the Department’s rule.

That assumption is based on a worstcase scenario for analytical purposes,

and it does not necessarily reflect the

current state of the energy industry.

Although the recent deregulation of

electric utilities has led to considerable

reorganization, the use of coal is both

extensive and increasing. In general,

electric utilities currently are taking

advantage of the opportunities

presented by deregulation to deal with

expanding demand by management,

rather than by making major

investments in new generating capacity.

In this environment, natural gas and oil

are attractive, in part, because they are

used to meet on-peak demand for

electricity. As a result, most generation

capacity, now in use and currently

planned, is gas-fired. The relatively low

capital cost of gas- or oil-fired

generation capacity (despite the

relatively high fuel cost) makes these

fuels cost-effective for the low capacity

utilization associated with on-peak

power production. Coal, however, is the

mainstay of off-peak, baseline electricity

generation. The different use pattern is

reflected by different capacity

utilization rates. In 1996, for example,

capacity utilization was 63 percent for

coal-fired power plants but only 20

percent for natural gas power plants and

11 percent for oil-fired plants. (EIA,

‘‘Challenges,’’ Chapter 1, p. I–4). In

baseline power generation, coal faces

less competitive pressure and more

opportunities for investment in new

capacity. Run-of-stream hydroelectric

power is limited, as is the potential for

its expansion. Nuclear generation

capacity is declining because old plants

are coming off line, and no new ones are

being built. As a consequence, utilities

are burning more coal—not less—and

this trend is expected to continue.

It is certainly true that long-term highprice contracts for coal are giving way

to shorter term contracts with more

flexibility. Yet even here there are

mitigating factors. Only about half of

current contracts will expire by 2005.

The impetus for the shift away from

long-term contracts was stimulated by

stabilization of other fuel prices at

moderate levels, but quite recently oil

prices have shot up again. The point is

that the current market still offers

considerable opportunities for passing

costs to consumers.

Available information indicates that

most of the downward pressure on coal

prices is flowing from developments

within the coal industry and intraindustry competition. Coal producers as

a whole have increased their

productivity and lowered their costs.

Cost reduction has resulted from

improved management of mining

operations and delivery, introduction of

new technology (e.g., longwall mining),

investment in more productive

equipment, consolidation to achieve

economies of scale, closure of high-cost

mines, and takeover and restructuring of

high cost mines to operate them more

economically. The EIA has observed

that ‘‘the relationship between coal

prices and productivity gains is circular:

Productivity gains allow coal prices to

be lowered and price declines induce

actions by coal producers that raise

productivity and cut costs’ (EIA,

‘‘Challenges,’’ Chapter 1, p. I–12). The

problem that small coal mines face is

that they are less able than large mines

to implement such productivity

enhancing measures. As a result, small

inefficient coal mine operators are being

squeezed by larger more efficient mine

operators.

Rapidly increasing productivity,

however, does not preclude the coal

industry as a whole from increasing its

prices in the short run to recoup

regulatory compliance costs. These costs

are small. Based on West Virginia

insurance rates, the increase in

insurance rates would translate into a

one-time increase in labor costs of 1.2

percent a year. By contrast, labor

productivity (tons per miner hour)

increased by an average of 6.9 percent

each year from 1980 to 1996 (EIA,

‘‘Challenges,’’ Chapter 1, p. I–12). This

annual productivity increase—five or

six times as large as the estimated

impact of the regulation—would allow

the coal industry to pass through costs

of the rule without raising prices at all.

Only a small one-time diminution in the

reduction of the price of coal would be

needed.

It is true that small mines cannot

increase prices beyond those of larger

counterparts and stay competitive. The

analysis of relative impacts indicates

that very small, underground coal mines

may be able to pass through one quarter

to one half of their costs of the rule to

consumers under the cover of larger

mines passing all of their costs of the

rule through to consumers. The

Department’s preliminary economic

analysis treated pass-through of costs of

the rule essentially as a factor that could

mitigate to some extent—not prevent—

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80039

impacts on profits. See Rulemaking

Record, Exhibit 80, pp. 52–56. For the

reasons outlined above, the Department

continues to believe that this is the case.

Because of the difficulty of quantifying

these effects, however, the quantitative

analysis will continue to assume zero

cost pass-through. The uncertainty as to

the extent to which costs can be passed

through does not mean that the

Department is unable to estimate

impacts, however. Rather, the

assumptions that the analysis made to

deal with the uncertainty result in

estimates of impacts on profits and

closures that are known to be biased

upward—as is appropriate for a

conservative analysis of impacts.

The market for anthracite coal is

significantly more sheltered from price

competition than the market for

bituminous coal. Since 1996, a majority

of anthracite production has been

accounted for by culm bank operations.

These operations salvage previouslymined anthracite from old mine tailings

on the surface. The market for these

operations (and potentially for other

anthracite mines) is nearby power

plants. Most of these plants are

cogeneration plants, which produce

heat or steam for industrial use as their

principal output, and then generate

electric power as a byproduct. Some,

however, are small power plants built

solely to use anthracite from culm

banks. The Public Utility Regulatory

Policies Act of 1978, Pub. L. 95–617, 92

Stat. 3117(1978), requires electric

utilities to purchase electric energy from

cogeneration facilities and other

qualifying small power production

facilities. The Act goes on to stipulate

that the price at which utilities purchase

electric energy may not exceed ‘‘the

incremental cost to the electric utility of

alternative electric energy.’’ 16 U.S.C.

824a–3(b). Since most of the electricity

generated with the anthracite is a

byproduct of steam and heat produced

for other purposes and the capacity is

already installed, the incremental cost

of power to utilities is virtually certain

to provide sufficient revenue to make

these anthracite operations

economically viable, despite the costs of

the rule. If anything, anthracite from

culm banks is likely to become more

competitive as the prices of other fuels

used to generate electricity rise. Indeed,

anthracite culm banks are the only part

of the coal mining industry in which

both the number of very small

operations and the number of

employees have expanded substantially

over the last 10 to 15 years.

The broader market for anthracite

includes metallurgical uses and other

specialty markets. This provides

anthracite with a degree of product

differentiation that bituminous coal

does not have. The economic forces in

the anthracite mining industry are

significantly different from those in the

bituminous coal mining industry. In

anthracite, there are no large mines, no

high-productivity mines, and generally

not the geological conditions that are

favorable to large-scale equipment or

techniques that would allow increases

in productivity. Instead of a steady

increase in output, anthracite

production (exclusive of culm banks)

fell by 19 percent between 1986 and

1997. Together with the rise of

anthracite salvage operations, this

decline appears to reflect exhaustion of

anthracite deposits that can be mined

economically, rather than the sort of

fierce competition characterized by

highly elastic demand.

One comment argues that the

Department’s initial regulatory

flexibility analysis did not properly

analyze the effect of its rule on coal

mine construction and transportation

contractors, as well as on other small

businesses performing services at mine

sites. The Department acknowledged

that its rule would have an effect on

entities in the ‘‘Coal Mining Services’’

industry, and estimated that of 275

firms listed in data available from the

Small Business Administration, no more

than 209 were small businesses within

the SBA’s definition (less than $5

million in annual receipts). The

Department recognized, however, that

this number might understate the

number of coal mine construction and

coal transportation companies. 64 FR

55008 (Oct. 8, 1999).

The RFA does not require, however,

that the Department determine precisely

the economic effect on small businesses

where it is not feasible to do so. Instead,

it requires only that the initial

regulatory flexibility analysis ‘‘describe

the impact of the rule on small entities.’’

5 U.S.C. 603(a). The Department’s initial

regulatory flexibility analysis described

the impact of its proposed regulations

based on an economic analysis. The

economic analysis projected an increase

in the approval rate of black lung claims

payable by responsible operators and a

temporary increase in the number of

claims filed. To the extent that coal

mine contractors obtain insurance to

spread the risk of potential liability

under the Act, the Department’s initial

regulatory flexibility analysis of the

resulting increase in insurance

premiums was also relevant to those

entities. In the absence of a more precise

estimate of the number of entities

involved, however, and the manner in

which those entities currently absorb

the costs imposed by the Black Lung

Benefits Act, the Department’s initial

regulatory flexibility analysis fulfilled

the requirements of the RFA by

identifying a potential impact on the

coal mine contracting industry.

Thus, the Department does not

believe the comments undermine the

validity of its initial regulatory

flexibility analysis, or of the economic

analysis that the Department used in

preparing it. Both analyses describe the

impact that the revised regulations are

likely to have on small coal mine

operators, and both analyses

acknowledge that this impact may be

sufficient to make the mining of coal

uneconomical for some. 64 FR 55008–09

(Oct. 8, 1999); Rulemaking Record,

Exhibit 80, pp. 44–46, 52. The

Department’s proposal, and its

discussion of possible alternatives

intended to mitigate the impact of the

proposal on small businesses, were

made with full knowledge of the

projected economic impact.

Accordingly, although the Department

has committed to the revision of the Part

722 regulations, see discussion of

alternatives, below, and preamble to

Part 722, the Department has not altered

its proposal in response to any of the

comments it received in response to the

initial regulatory flexibility analysis.

Small Businesses to Which the Rule

Will Apply

The revised regulations implementing

the Black Lung Benefits Act will apply,

like the Act itself, to coal mine

operators. See, e.g., 30 U.S.C. 932(b)

(‘‘each such operator shall be liable for

and shall secure the payment of benefits

* * * ’’). The term ‘‘operator’’ includes

not only traditional coal mining

companies, but also employers who

provide services to such companies,

including coal mine construction and

coal transportation companies. 30

U.S.C. 802(d). In the initial regulatory

flexibility analysis published in its

second notice of proposed rulemaking,

the Department observed that the

Regulatory Flexibility Act requires an

administrative agency to use the

definition of a ‘‘small business’’

promulgated by the Small Business

Administration unless the agency, after

consulting with the SBA’s Office of

Advocacy and providing an opportunity

for public comment, establishes its own

definition. 5 U.S.C. 601(3). (The

Department’s regulations do not apply

to any small organizations or small

governmental jurisdictions; accordingly,

the Department’s analysis is limited to

small businesses.) The Department

therefore announced its intention to use

the SBA definition, which establishes

80040 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

criteria for different industries, arranged

by the Standard Industrial Codes (SICs)

used by the Bureau of the Census. SBA’s

regulations define a small business in

the coal mining industry (SIC Codes

1220, 1221, 1222, 1230, and 1231) as

one with fewer than 500 employees. A

small business in the coal mining

services industry (SIC Codes 1240 and

1241) is one with less than $5 million

in annual receipts. 64 FR 55007–08

(Oct. 8, 1999).

Based on 1995 data, the Department

determined that of 2,822 establishments

in the coal mining industry, 2,811

employed less than 500 people. Of

those, 1,581 were surface bituminous

mining companies, 1009 were

underground bituminous mining

companies, and 221 were anthracite

mining companies. The Department

estimated that no more than 209 of the

275 firms in the coal mining services

industry would be considered small

businesses. The Department observed,

however, that its estimate did not

necessarily include all coal mine

construction and coal transportation

companies, and that the precise number

of such businesses could not be

estimated with precision. 64 FR 55007–

08 (Oct. 8, 1999).

More recent data available from the

Mine Safety and Health Administration

suggest that the composition of the coal

industry has not changed significantly.

In 1997, 2,568 of 2,578 establishments

in the coal mining industry employed

less than 500 people. Of these, 1,441

were surface bituminous mining

companies, 913 were underground

bituminous mining companies, and 214

were anthracite mining companies.

Census figures available from the Small

Business Administration do not allow

the Department to calculate how many

of the 317 firms in the coal mining

services industry would be considered

small businesses, because those figures

do not contain sufficient information on

the revenues of those firms.

Projected Reporting, Recordkeeping,

and Other Compliance Requirements of

the Rule

In its initial regulatory flexibility

analysis, the Department observed that

its proposed revisions would not

impose any additional reporting or

recordkeeping requirements on small

businesses. The Department stated that

the compliance requirements of the rule

were largely economic in impact. The

Department projected its regulatory

revisions would increase the cost of

commercial insurance (through

increased premiums) purchased by coal

mine operators to secure their benefits

liability under the Act. The Department

also projected an increase in the

potential exposure of operators who are

authorized to self-insure their liability

under the Act. A summary of these

additional costs was published in the

Department’s initial regulatory

flexibility analysis. 64 FR 55008–09

(Oct. 8, 1999). In addition, the

Department observed that coal mine

operators that did not purchase

insurance, either because they were selfinsured, or because they were not

required to secure benefits, or because

they had ignored the Act’s security

requirement, would face additional

burdens. These burdens included

responding more promptly to notice

from the Department that a claim had

been filed by one of their former

employees, and posting security in the

event that they were held liable for the

payment of benefits on an individual

claim. Operators that had been

authorized to self-insure their liability

under the Act would be required to

maintain security for claims filed

against them, even after they ceased

mining coal. Finally, the Department

observed that the regulatory revisions

enhanced its ability to enforce civil

money penalties against operators that

failed to comply with the Act’s security

requirements. 64 FR 55008–09 (Oct. 8,

1999).

The regulatory revisions in the

Department’s final rule do not

significantly change the costs identified

by the Department’s initial regulatory

flexibility analysis. Specifically, only

one of the changes that the Department

has adopted in this final rule in

response to public comments has cost

implications. The Department has

eliminated the notice of initial finding,

a document that the Department

currently uses to deny claims informally

before the district director. Both the first

and second notices of proposed

rulemaking proposed the continued use

of this document. Eliminating issuance

of initial findings will decrease operator

costs in all cases by reducing the

numbers of responses that coal mine

operators have to file with the

Department. Eliminating this document,

however, will also require that coal

mine operators undertake the

development of responsible operator

evidence (evidence showing that

another entity that employed the miner

should be the responsible operator) in a

number of additional cases. Under the

Department’s second notice of proposed

rulemaking, coal mine operators would

not have been required to develop

responsible operator evidence in cases

in which the claimant failed to respond

to the Department’s notice of initial

finding denying their claims. Under the

final rule, a coal mine operator may not

know whether the claimant is interested

in pursuing his claim (unless the

claimant withdraws his application

under § 725.306) until after that operator

has developed its responsible operator

evidence.

The Department believes that the

costs resulting from this revision will

have only a minor impact on its

previous estimate of the costs of the

rule. As an initial matter, the

Department estimates that this revision

will affect less than 10 percent of all

responsible operator cases. In FY 1999,

a total of 5,724 cases were filed. The

Department estimates that just over 75

percent of these claims, or 4,293, were

claims involving potential responsible

operator liability. Ten percent of this

number is 429. The Department’s

economic analysis assumed that an

additional 1,720 operator cases will be

filed each year for two years following

issuance of the Department’s final rules.

Ten percent of this number is 172. In

each of the next two years, then, the

revision will cause the additional

development of responsible operator

evidence in only 601 claims. Under the

proposed rule in the Department’s

second notice, however, operators

would also have had to develop such

evidence in the 30 percent of such cases

that proceed beyond adjudication by the

district director. Consequently, the

Department’s final rule will require

additional evidentiary development in

only the remaining 70 percent of cases,

or 421 cases. The Department has no

way of accurately estimating the costs of

developing such evidence. However, a

rough estimate can be made using

information in M&R’s first analysis.

M&R estimated that the total cost to

operators in defending claims that were

resolved at the district director level

was approximately $3,000. Rulemaking

Record, Exhibit 5–160, Appendix 5, p.

24. This figure included not only the

development of responsible operator

evidence but, under the Department’s

first proposal (to which M&R was

responding), of all medical evidence as

well. Although the cost of developing

medical evidence is typically much

higher than the cost of operator

evidence, because it involves payments

to expert witnesses, the Department will

assume that half of these defense costs

represent the cost of developing

responsible operator evidence.

Accordingly, the total additional costs

imposed by this revision are not likely

to exceed $631,050 (70 percent of 601

claims times $1,500) in each of the first

two years, and will drop to no more

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80041

than $450,450 (70 percent of 429 claims

times $1,500) for each year thereafter. In

light of the point estimate of $57.56

million in annual costs identified by the

Department’s economic analysis of the

proposed rule, these additional costs are

not significant. In any event, these

additional costs will be at least partially

offset by the savings realized in all cases

from the reduced number of required

operator responses. In addition, the

Department’s decision to permit the

district director to refer a case to the

Office of Administrative Law Judges

with no more than one operator as a

party to the claim will result in

additional savings to coal mine

operators in some cases.

Description of Steps the Agency has

Taken to Minimize the Impact on Small

Entities Consistent With the Stated

Objectives of Applicable Statutes;

Discussion of Alternatives

The primary objective of the Black

Lung Benefits Act is set forth in § 901

of the Act:

It is, therefore, the purpose of this

subchapter to provide benefits, in

cooperation with the States, to coal miners

who are totally disabled due to

pneumoconiosis and to the surviving

dependents of miners whose death was due

to such disease; and to ensure that in the

future adequate benefits are provided to coal

miners and their dependents in the event of

their death or total disability due to

pneumoconiosis.

30 U.S.C. 901. The statute also seeks to

ensure, however, that liability for a

miner’s benefits is borne by the entity

most responsible for the development of

that miner’s totally disabling

pneumoconiosis. Prior to 1978, claims

that were not paid by individual coal

mine operators were paid by the federal

government from general revenues. In

1978, Congress created the Black Lung

Disability Trust Fund, financed by an

excise tax on coal production, to assume

the payment of benefits in cases for

which no individual operator bore

liability. Congress clearly indicated its

preference that the Trust Fund should

be considered a payment source of last

resort. In discussing the successor

operator provisions of the Black Lung

Benefits Reform Act of 1977, enacted in

1978, the Senate Committee on Human

Resources, whose bill contained the

provisions ultimately included in the

Act, stated: ‘‘It is further the intention

of this section, with respect to claims

[in] which the miner worked on or after

January 1, 1970, to ensure that

individual coal mine operators rather

than the trust fund bear the liability for

claims arising out of such operator’s

mine, to the maximum extent feasible.’’

S. Rep. 95–209, 95th Cong., 1st Sess. 9

(1977), reprinted in House Comm. On

Educ. And Labor, 96th Cong., Black

Lung Benefits Reform Act and Black

Lung Benefits Revenue Act of 1977, 612

(Comm. Print).

In its initial regulatory flexibility

analysis, the Department observed that

these two principles severely

constrained its ability to select

alternatives that the Department had

identified as potentially providing relief

for small coal mine operators. The

Department discussed several

alternatives, including adjusting a

miner’s entitlement criteria according to

the size of the operator that would be

considered the responsible operator

under the Department’s regulations. A

second alternative would have limited

the liability of certain employers. These

employers might include those that met

either the SBA definition of a small

business (over 90 percent of the

industry) or those employers with fewer

than 20 employees, companies that the

Department’s economic analysis had

identified as most vulnerable. In such

cases, the Department considered

imposing liability on larger operators or

on the Black Lung Disability Trust

Fund. The Department rejected both

alternatives, however, as contrary to the

intent of Congress as expressed in the

Black Lung Benefits Act. 64 FR 55009

(Oct. 8, 1999). The Department did

provide relief to small mining

companies in its revised regulations

governing the assessment of civil money

penalties for an operator’s failure to

secure the payment of benefits, 20 CFR

Part 726, Subpart D. These regulations

specifically assess a smaller base

penalty amount on a smaller employer,

i.e., one with few miner-employees.

Finally, the Department invited

comment from interested parties as to

other alternatives that would reduce the

financial impact of the rules on the

small business community.

A number of comments suggest that

by inviting comments as to other

alternatives, the Department abdicated

its responsibilities under the Regulatory

Flexibility Act. The Department does

not agree. Nothing in the RFA requires

an agency to forego rulemaking because

the regulated community is unhappy

with the alternatives that the agency

considered in its initial regulatory

flexibility analysis, or because that

community has proposed additional

alternatives. On the contrary, the RFA

encourages agencies to notify small

businesses of proposed rulemaking

activities precisely so that those small

businesses may participate in the

identification of additional alternatives

that might reduce the impact of the rule.

See 5 U.S.C. 609(a).

The National Mining Association

(NMA), endorsed by a number of other

commenters, has identified six

alternatives that it believes the

Department should have considered: (1)

establish a fund to insure coal mine

operators for federal black lung claims

on a first dollar basis under the

authority granted the Department by 30

U.S.C. 943; (2) establish a fund to

reinsure coal mine operators for federal

black lung claims on a specific or

aggregate of loss basis, also under the

authority granted the Department by 30

U.S.C. 943; (3) name only the most

likely responsible operator; (4) establish

criteria to determine when a state black

lung program is sufficient to end the

federal program in that state; (5) allow

settlement of federal black lung claims;

and (6) establish cost-containment

mechanisms for health care providers.

Rulemaking Record, Exhibit 89–37, p.

31. The M&R analysis similarly suggests

the first four alternatives, although it

would apply the third alternative

(naming the most likely operator) only

where that operator is a small coal mine

operator. In addition, the M&R analysis

suggests that the Department establish a

formal, ongoing review of state workers’

compensation programs to determine

whether they are sufficient to permit the

Secretary to declare the federal program

inapplicable to miners in particular

states. Rulemaking Record, Exhibit 89–

37, Appendix A, M&R at pp. 17–18. The

Department will consider these

alternatives in order.

1. Exercising the authority of 30

U.S.C. 943 (NMA alternatives 1 and 2,

M&R alternatives 1 and 2). Section 933

of the Black Lung Benefits Act, 30

U.S.C. 943, authorizes the Secretary of

Labor to establish a Black Lung

Compensation Insurance Fund to allow

coal mine operators to purchase

insurance to secure their obligations

under the Act. The Fund may be used

to insure coal mine operators directly,

30 U.S.C. 943(c)(1), or to enter into

reinsurance agreements with one or

more insurers or pools of insurers, 30

U.S.C. 943(c)(2). The Act provides an

important limitation on the Secretary’s

authority, however: ‘‘The Secretary may

exercise his or her authority under this

section only if, and to the extent that,

insurance coverage is not otherwise

available, at reasonable cost, to

operators of coal mines.’’ 30 U.S.C.

943(b) (emphasis added). The record

contains no evidence that would allow

the Secretary to determine, under

subsection (b), that insurance coverage

is not currently available at reasonable

cost to operators of coal mines.

80042 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Consequently, the statute does not

permit the ‘‘alternative’’ suggested by

the commenters. Projections provided

by the mining and insurance industries,

however, predict significantly higher

percentage increases in the cost of

commercial black lung insurance if

these rules become final. The

Department disagrees with these

projections and has explained its

reasoning above. The Department also

recognizes its obligation, however, to

closely monitor insurance rates,

especially any increase in rates that may

result from the final promulgation of the

Department’s regulations. To the extent

that rates do increase, the Department

will have to determine whether those

increases have resulted in insurance

becoming unavailable at a reasonable

cost to coal mine operators, the statutory

prerequisite for the Secretary’s authority

under 30 U.S.C. 943(b).

2. Naming only the most likely

responsible operator (NMA Alternative

3, M&R alternative 3). The NMA

suggests that the Department name only

the most likely responsible operator,

which the NMA asserts was the

Department’s practice under its former

regulations. The M&R analysis states

that the Department could form an

insurance fund to reimburse the Black

Lung Disability Trust Fund for claims in

which the most likely responsible

operator is ultimately determined not to

be liable for the payment of benefits,

thereby imposing an unwarranted

liability on the Fund. The Department

does not agree that it formerly named

only the most likely responsible

operator. In its discussion of § 725.408,

the Department observed that, where

necessary, it made more than one

operator a party to a claim under the

prior regulations. See preamble to

§ 725.408, paragraph (f). In addition,

M&R’s solution to the problem of

imposing additional risk on the Trust

Fund—that the Department use an

‘‘insurance fund’’ to reimburse the Trust

Fund for such claims—is flawed on two

counts: 1) for the reasons described

above, the Department cannot establish

an insurance fund absent a finding that

insurance is not available at reasonable

cost; and 2) reimbursement of the Trust

Fund for such claims is not among the

statutorily-prescribed uses for monies in

an insurance fund, see 30 U.S.C.

943(g)(1)(A)–(C).

The Department notes, however, the

continued objection of a number of

commenters to the Department’s

proposal that operators be forced to

participate in a joint defense of the

claimant’s eligibility, see preamble to

§ 725.414. The Department has therefore

reconsidered its administrative

processing of cases in which the

identity of the responsible operator is in

doubt. As revised, the regulations

permit the district director to refer a

case to the Office of Administrative Law

Judges with no more than one operator

included as a party to the claim. See

preamble to § 725.418. The Department

recognizes that this approach imposes

additional risk on the Black Lung

Disability Trust Fund. See preamble to

§ 725.414. The Department has

concluded that this risk is acceptable,

however, because all the potentially

liable operators will be required to

submit evidence relevant to the issue of

operator liability while the case is

pending before the district director. The

district director will thus have available

all of the relevant evidence when he

finally designates the operator

responsible for payment of a claim. That

one operator will remain a party in

further proceedings.

The Department does not believe that

this alternative is a truly significant

one—i.e., one which will provide the

affected small business community with

significant relief from the costs of the

Department’s regulatory revisions. First,

it will apply in only a small percentage

of cases. The Department estimates that

less than 10 percent of responsible

operator cases involve substantial

questions as to the identity of the

operator that should be liable for the

payment of benefits. In addition, only

33 percent of all cases filed are referred

to the Office of Administrative Law

Judges. Accordingly, the Department’s

revision will likely affect only 3 percent

of responsible operator cases. Second,

the additional cost that would have

been required by continued operator

participation is relatively small. It is

true that operators will no longer have

to defend against an effort by the

designated responsible operator to shift

liability to them beyond the district

director level. Instead, once a case is

referred to the Office of Administrative

Law Judges, if the designated

responsible operator shows that it does

not meet the criteria for a responsible

operator, § 725.495, liability will shift to

the Trust Fund. The costs associated

with an operator’s continued

participation in a claim before the Office

of Administrative Law Judges would

have been small, however, because the

operator would already have had to

develop and submit all evidence

relevant to the liability issue while the

case was pending before the district

director. The final regulations do not

alter that requirement. A second set of

costs eliminated by the Department’s

revision are those associated with

monitoring the designated responsible

operator’s litigation of the claimant’s

eligibility while the case is pending

before the Office of Administrative Law

Judges. The Department’s proposal

would have permitted a potentially

liable operator to submit its own

documentary medical evidence upon

establishing that the designated

responsible operator had not undertaken

a full development of the evidence. The

Department does not believe that this

situation would have arisen often, and

thus believes that the overall costs

associated with exercising this right

were not significant. The costs relevant

to both of these issues were thus largely

the costs associated with hiring an

attorney to monitor the litigation and, as

appropriate, attend the hearing or file a

brief to argue on the operator’s behalf.

In preparing its economic analysis, the

Department used the industry’s estimate

of $6,000 as the current average cost for

defending a claim that proceeds beyond

the district director level. See preamble

to § 725.407. This cost includes not only

attorneys’ fees, but also the

development of evidence relevant to

operator liability and claimant

eligibility. The Department does not

believe that the fees charged by an

attorney to monitor the litigation and

present argument represent a large

component of the estimated costs.

Accordingly, in light of both the small

number of affected cases and the

minimal expenses involved, the

Department does not consider that its

adoption of this alternative will result in

significant savings to small coal mine

operators.

3. Establish criteria to determine

when a state’s workers’ compensation

program provides ‘‘adequate coverage’’

for totally disabling pneumoconiosis

(NMA alternative 4, M&R alternative 4).

Section 421 of the Black Lung Benefits

Act, 30 U.S.C. 931, requires the

Secretary to publish in the Federal

Register a list of all states whose

workers’ compensation laws provide

‘‘adequate coverage’’ for occupational

pneumoconiosis. The Secretary’s

certification that a state provides

adequate coverage prevents any claim

for benefits arising in that state from

being adjudicated under the Black Lung

Benefits Act.

The Act provides certain criteria

states must meet in order to gain

Secretarial certification, 30 U.S.C.

921(b)(2)(A)—(E). It also provides that

the Secretary may, by regulation,

establish additional criteria. 30 U.S.C.

921(b)(2)(F). In its first notice of

proposed rulemaking, the Department

observed that the applicable regulations,

20 CFR Part 722 (1999), had not been

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80043

amended since 1973, and that, in light

of statutory amendments in 1978 and

1981, those regulations were obsolete.

62 FR 3347 (Jan. 22, 1997). Accordingly,

the Department proposed to delete the

specific criteria contained in Part 722.

The Department proposed replacing

them with a general statement that it

would review any state’s application for

certification in light of the provisions of

the then-current Act, and the principle

that the state law would be certified

only if it guaranteed at least the same

compensation, to the same individuals,

as was provided by the Act.

The NMA and M&R urge the

Department to develop specific criteria

that would allow a state to determine

what steps it needs to take to allow the

Secretary to certify its law as providing

adequate coverage for occupational

pneumoconiosis. M&R states that ‘‘[n]o

single alternative would be more helpful

to small coal operations than to be

required to provide compensation under

only one mechanism.’’ M&R at p. 18.

This suggestion would require the

Department to update the criteria

previously set forth in Part 722.

Although no state has sought the

Secretary’s certification since 1973, the

Department accepts the commenters’

suggestion that a revision of the Part 722

criteria will encourage states to seek the

certification permitted by the Act.

Publication of a current set of criteria,

however, will require considerable

study and additional drafting, and

would needlessly delay final

promulgation of the remaining

regulations in the Department’s

proposal. Following completion of that

work, the Department will issue a new

notice of proposed rulemaking in order

to ensure that interested parties have an

opportunity to comment upon possible

Secretarial certification criteria. The

Department believes that, in the interim,

the revised Part 722 will accommodate

any state seeking certification.

M&R also suggests that the

Department establish a formal and

ongoing Departmental review of state

laws to determine whether they provide

adequate coverage. The Department

does not believe that it would be

productive to engage in such a review.

States that revise their workers’

compensation laws to meet the

Department’s criteria will do so in order

to preempt the application of the Black

Lung Benefits Act. Those states will

have a clear incentive to submit an

application to the Department for the

appropriate certification. Relying on

states to initiate the certification process

thus makes the most efficient use of

government resources at both the state

and federal levels.

4. Permit the settlement of black lung

claims (NMA Alternative 5). The NMA

suggests, without further explanation,

that permitting the settlement of black

lung claims will reduce the impact of

the Department’s regulatory revisions on

small coal mine operators. The

Department believes that the Black Lung

Benefits Act does not allow the

settlement of claims, and that permitting

the settlement of claims would be

contrary to the objectives of the Act in

any event.

The Black Lung Benefits Act

incorporates two provisions of the

Longshore and Harbor Workers’

Compensation Act relevant to

settlements, and specifically excludes a

third provision. Section 15(b) of the

LHWCA, 33 U.S.C. 915(b), renders

invalid any ‘‘agreement by an employee

to waive his right to compensation

under this chapter.’’ Section 16, 33

U.S.C. 916, invalidates any ‘‘release

* * * of compensation or benefits due

or payable under this chapter, except as

provided in this chapter.’’ Together,

these provisions, which have been part

of the LHWCA since its 1927 enactment,

have been interpreted to ‘‘prevent[] any

private settlement of a claim between

the employer and the employee.’’

American Mutual Liability Ins. Co. of

Boston v. Lowe, 85 F.2d 625, 628 (3d

Cir. 1936); see also Lumber Mutual

Casualty Ins. Co. of New York v. Locke,

60 F.2d 35, 37 (2d Cir. 1932).

In 1938, Congress amended section 8

of the Longshore Act to specifically

provide a settlement procedure in cases

in which the injured employee sought

compensation for permanent or

temporary partial disability. See Act of

June 25, 1938, c. 685, § 5, 52 Stat. 1166.

The federal courts have long interpreted

the section 8 procedure as the only

means by which an injured employee

could validly settle a claim for

compensation. See, e.g., Norfolk

Shipbuilding & Drydock Corp. v. Nance,

858 F.2d 182, 185–6 (4th Cir. 1988),

cert. denied, 492 U.S. 911 (1989);

Oceanic Butler v. Nordahl, 842 F.2d

773, 776 n. 3 (5th Cir. 1988). In

incorporating certain procedures of the

LHWCA into the Black Lung Benefits

Act, however, Congress specifically

excluded LHWCA § 8. See list of

excluded provisions in 30 U.S.C. 932(a).

Moreover, although Congress authorized

the Secretary to vary the terms of

incorporated LHWCA provisions in

order to administer the Black Lung

Benefits Act, it forbade the Department

from promulgating provisions that were

‘‘inconsistent with those specifically

excluded * * *.’’ By this language,

Congress expressed its intention that the

Secretary not use the broad powers

granted her by the Black Lung Benefits

Act to provide by regulation the

substance of provisions that Congress

had explicitly declined to incorporate.

See Senate Conference Committee

Report, reprinted in Committee Print,

94th Cong., 1st Sess., Legislative History

of the Federal Coal Mine Health and

Safety Act of 1969 at 1624 (‘‘The

Secretary of Labor is also authorized to

publish additional provisions by

regulation, together with all or part of

the applicable provisions of said Act

other than those specifically excluded

* * *.’’), quoted in Director, OWCP v.

National Mines Corp., 554 F.2d 1267,

1274 n. 31 (4th Cir. 1977).

Congress’s decision to exclude the

settlement provisions of LHWCA

section 8 when it incorporated other

LHWCA provisions makes sense. When

Congress enacted the Black Lung

Benefits Act in 1969, and when it

amended the list of excluded sections in

1972, section 8 permitted only the

settlement of claims for partial

disability. Because benefits under the

Black Lung Benefits Act are available

only to miners who are totally disabled

due to pneumoconiosis, and to the

survivors of miners who die from that

disease, there was no reason to

incorporate section 8. Congress

amended section 8 in 1972 to allow

settlement of claims for total disability,

and again in 1984 to permit the

settlement of survivors’ claims. Pub. L.

92–576, § 20, 86 Stat. 1264 (1972); Pub.

L. 98–426, § 8(f), 98 Stat. 1646 (1984).

Congress did not revisit its exclusion of

Longshore Act provisions from the

Black Lung Benefits Act on either

occasion, even though Congress

specifically amended the relevant

statutory section in the Black Lung

Benefits Act, 30 U.S.C. 932(a), in the

course of amending the LHWCA in

1984. See Pub. L. 98–426, § 28(h)(i), 98

Stat. 1655 (1984).

The Department thus believes that

Congress has expressed its intent not to

permit the settlement of claims for black

lung benefits. Moreover, the Department

believes that this decision is supported

by sound policy considerations. The

Black Lung Benefits Act is intended to

provide benefits (37 and 1/2 percent of

the monthly pay for a federal employee

in grade GS–2, step 1, augmented for

additional dependents) to miners who

are totally disabled due to

pneumoconiosis and to the survivors of

miners who die due to the disease. 30

U.S.C. 922(a). ‘‘Providing a minimum

level of income for eligible miners

disabled by black lung is at the heart of

the statute.’’ Harman Mining Co. v.

Stewart, 826 F.2d 1388, 1390 (4th Cir.

1987). Interpreting the Act so as to

80044 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

permit a totally disabled miner to accept

a settlement that reduces that minimum

level of benefits would thus contravene

one of the basic objectives of the Act.

Former coal miners tend to apply for

black lung benefits shortly after they

leave employment in the coal industry

or when they retire, usually at the same

time they file an application for Social

Security benefits, rather than in

response to a specific diagnosis or

injury. The population of claimants thus

tends to be significantly different than is

the case with the population of claims

under other workers’ compensation

programs, including the LHWCA.

Because of the latent, progressive nature

of pneumoconiosis, see preamble to

§ 725.309, a substantial number of

applicants whose initial claims are

denied are ultimately determined to be

eligible for black lung benefits. In its

second notice of proposed rulemaking,

the Department observed that the

approval rate for subsequent claims

filed by miners whose initial claims

were denied (10.56 percent) is higher

than the approval rate for first-time

applicants (7.47 percent). 64 FR 54984

(Oct. 8, 1999). These statistics

demonstrate that first-time applicants

may not fully appreciate the extent to

which they may be affected by

pneumoconiosis later in life. As a result,

the Department believes that it would be

inappropriate to encourage or permit

such applicants to bargain away the

minimum level of benefits guaranteed

them by Congress. Accordingly, the

Department does not accept the

suggestion that permitting settlement,

even if it were not forbidden by the Act,

represents an alternative to the

Department’s rule that is consistent with

the objectives of the Black Lung Benefits

Act.

5. Establish cost-containment

mechanisms for health care providers

(NMA alternative 6).

Through the incorporation of LHWCA

§ 7, the Black Lung Benefits Act requires

responsible coal mine operators and the

Black Lung Disability Trust Fund to

provide medical benefits to miners who

meet the Act’s eligibility criteria. 33

U.S.C. 907, as incorporated into the

Black Lung Benefits Act by 30 U.S.C.

932(a). The Department’s regulations

require that a miner be provided ‘‘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 disability

require.’’ 20 CFR 725.701(b) (1999). In

Fiscal Year 1998, the Trust Fund paid

approximately $82.1 million for the

medical treatment of eligible miners,

processing approximately 620,000 bills.

OWCP Annual Report to Congress, FY

1998, p. 18.

The Department has already adopted

a variety of cost-containment measures

to reduce medical treatment costs paid

by the Trust Fund. The Department’s

guidelines for the payment of

medication expenses were derived from

the system used by the United Mine

Workers of America Health and

Retirement Funds in light of the similar

populations served by the UMWA

Funds and the Trust Fund. The

Department updates its list of allowable

charges for various drugs on a monthly

basis and for treatment procedures on a

periodic basis to ensure that it does not

reimburse miners and their medical

providers an amount above what is

usual and customary for the beneficiary

population. The Medical Director of the

Department’s Office of Workers’

Compensation Programs reviews

medications that have not previously

been approved for inclusion on the

Department’s list.

The Department also carefully screens

inpatient service bills for both an

acceptable diagnosis and an

‘‘appropriate’’ treatment based upon the

diagnosis and procedure codes present

on the Universal Billing Form. These

diagnoses and treatments are compared

to a set of algorithms that take into

account whether the diagnoses are

related to pneumoconiosis, the severity

of covered and non-covered conditions,

and the character of the procedures. The

program then makes a determination as

to whether a bill should be paid in full,

paid in part, denied in full, or made

subject to review by the Department’s

staff. Bills that are considered payable

are subject to a series of edits to

determine if specific types of services

should be paid, denied, or reviewed

before reimbursement. For example, the

Department will deny a bill for a private

room during a hospitalization in the

absence of adequate justification and

pay only the cost of a non-private room.

The cost-containment measures

adopted by the Department have

reduced the Trust Fund’s expenditures

for medical treatment. Operators and

their insurers, organizations with

considerable experience in costcontainment, are similarly free to adopt

measures that ensure that they pay no

more than the usual and customary

amounts for necessary services. Under

the Secretary’s regulations, eligible

miners present bills for medical services

directly to the responsible operator

liable for the payment of their benefits,

its insurer, or its claims servicing agent.

20 CFR 725.704(a)(2) (1999). Any

dispute between the miner and the

operator over payment of the bill is

subject to informal resolution by the

district director. If that resolution is

unsuccessful, either the miner or the

operator may obtain an expedited

hearing before the Office of

Administrative Law Judges. 20 CFR

725.707 (a), (b) (1999). Similarly, an

operator may request a hearing with

respect to any bill which was paid from

the Black Lung Disability Trust Fund

while the operator was contesting the

miner’s eligibility for benefits. ‘‘Though

framed as contests between the

particular Operator and the Fund over

reimbursement, these determinations

provide the means by which an

Operator may challenge the validity of

all or part of the miner’s initial claim,

including each medical expense, even

though it has already been paid by the

Fund.’’ BethEnergy Mines, Inc. v.

Director, OWCP, 32 F.3d 843, 847 (3d

Cir. 1994). Thus, the statute and its

implementing regulations afford an

operator ample opportunity to challenge

the reasonableness of any amount that a

claimant seeks as payment for medical

services. Although the Department will

continue to refine its cost-containment

procedures, it does not believe that

these procedures represent an

‘‘alternative’’ to its rulemaking

activities. Rather, cost-containment

must take place simultaneously with

any revision of the Department’s

regulations to ensure that the revisions

do not produce any unreasonable

changes in health care expenditures.

In summary, the Department does not

believe that any of the alternatives

suggested by the NMA and M&R offer

relief to small business that is consistent

with the stated objectives of the Black

Lung Benefits Act. Although the

Department does intend to revise the

Part 722 criteria in light of the

commenters’ suggestion, the failure of

any state to seek certification of its laws

over the last quarter century indicates

that this effort will not result in any

quick relief to the small business

community from the economic impact

of the Department’s regulations. With

the exception of graduated civil money

penalties, the requirements of the Black

Lung Benefits Act simply do not permit

the Department to adjudicate the issues

of claimant eligibility and operator

liability differently depending on the

size of the coal mine operator that may

be liable for the payment of those

benefits. Because the Department

believes that the ‘‘no action’’ alternative,

discussed in detail above, would also be

inappropriate, the Department has

published a final rule implementing its

proposed revisions.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80045

Conclusion

The Department’s final rule revising

the regulations implementing the Black

Lung Benefits Act will result in the

increase of premiums paid by the coal

mining industry to insure their

obligations under the Act. The

economic analysis prepared in

connection with the Department’s initial

regulatory flexibility analysis

demonstrated that this premium

increase would result in additional

annual costs to the industry with a point

estimate of $57.56 million. The

Department’s revised rule will not result

in any significantly higher costs. In light

of the need for the revised regulations

identified above, the Department

believes that it is appropriate to finalize

the rule.

List of Subjects in 20 CFR Parts 718,

722, 725, 726, 727

Black lung benefits, Lung disease,

Miners, Mines, Workers’ compensation,

X-rays.

Signed at Washington D.C., this first day of

December, 2000.

Bernard E. Anderson,

Assistant Secretary for Employment

Standards.

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), 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.

§§ 718.401–718.404 [Removed]

2. Part 718 is amended by removing

subpart E (§§ 718.401–718.404), 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

§ 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 § 718.306 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,

contained in the 20 CFR, Part 500 to

end, edition, revised as of April 1,

1979.) 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)).

§ 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.

§ 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 § 718.306

partially, disabled due to

80046 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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.

§ 718.4 Definitions and use of terms.

Except as is otherwise provided by

this part, the definitions and usages of

terms contained in § 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

§ 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 bloodgas 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 after January 19, 2001 in

connection with a claim governed by

this part (see §§ 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 January 19, 2001. 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.

§ 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.

(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. This document is available from

the Division of Coal Mine Workers’

Compensation in the U.S. Department of

Labor, Washington, D.C., telephone

(202) 693–0046, and from the National

Institute for Occupational Safety and

Health (NIOSH), located in Cincinnati,

Ohio, telephone (513) 841–4428) and

Morgantown, West Virginia, telephone

(304) 285–5749. A chest X-ray classified

as Category Z under the ILO

Classification (1958) or Short Form

(1968) shall be reclassified as Category

0 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 0, 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 § 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 Xray 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) Except as provided in this

paragraph, 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 paragraphs (a) through (d),

such X-ray may form the basis for a

finding of the presence or absence of

pneumoconiosis if it is of sufficient

quality for determining the presence or

absence of pneumoconiosis and such Xray was interpreted by a Board-certified

or Board-eligible radiologist or a

certified ‘‘B’’ reader (see § 718.202).

§ 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 flow versus volume (flowvolume loop). The instrument shall

simultaneously provide records of

volume versus time (spirometric

tracing). The report shall provide the

results of the forced expiratory volume

in one second (FEV1) and the forced

vital capacity (FVC). The report shall

also provide the FEV1/FVC ratio,

expressed as a percentage. If the

maximum voluntary ventilation (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 the flow versus volume

and the electronically derived volume

versus time tracings. If the MVV is

reported, two tracings of the MVV

whose values are within 10% of each

other shall be sufficient. Pulmonary

function test results developed 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;

(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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80047

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) Except as provided in this

paragraph, 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, where no pulmonary function

tests are in substantial compliance with

paragraphs (a) and (b) and Appendix B,

noncomplying tests may form the basis

for a finding if, in the opinion of the

adjudication officer, the tests

demonstrate technically valid results

obtained with good cooperation of the

miner.

§ 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 § 718.102; and

(6) The results of a pulmonary

function test conducted and reported as

required by § 718.103. If the miner is

physically unable to perform a

pulmonary function test or if the test is

medically contraindicated, in the

absence of evidence establishing total

disability pursuant to § 718.304, the

report must be based on other medically

acceptable clinical and laboratory

diagnostic techniques, such as a blood

gas study.

(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 § 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,

where no report is in substantial

compliance with paragraphs (a) and (b),

a report prepared by a physician who is

unavailable may nevertheless form the

basis for a finding if, in the opinion of

the adjudication officer, it is

accompanied by sufficient indicia of

reliability in light of all relevant

evidence.

(d) Treating physician. In weighing

the medical evidence of record relevant

to whether the miner suffers, or

suffered, from pneumoconiosis, whether

the pneumoconiosis arose out of coal

mine employment, and whether the

miner is, or was, totally disabled by

pneumoconiosis or died due to

pneumoconiosis, the adjudication

officer must give consideration to the

relationship between the miner and any

treating physician whose report is

admitted into the record. Specifically,

the adjudication officer shall take into

consideration the following factors in

weighing the opinion of the miner’s

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) In the absence of contrary

probative evidence, the adjudication

officer shall accept the statement of a

physician with regard to the factors

listed in paragraphs (d)(1) through (4) of

this section. In appropriate cases, the

relationship between the miner and his

treating physician may constitute

substantial evidence in support of the

adjudication officer’s decision to give

that physician’s opinion controlling

weight, provided that the weight 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.

§ 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 PC02, P02,

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.

Failure to produce such a report will

prevent reliance on the blood-gas study

as evidence that the miner was totally

disabled at death. (e) In the case of a

deceased miner, where no blood gas

tests are in substantial compliance with

80048 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

paragraphs (a), (b), and (c),

noncomplying tests may form the basis

for a finding if, in the opinion of the

adjudication officer, the only available

tests demonstrate technically valid

results. This provision shall not excuse

compliance with the requirements in

paragraph (d) for any blood gas study

administered during a hospitalization

which ends in the miner’s death.

§ 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

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.

(c) A negative biopsy is not

conclusive evidence that the miner does

not have pneumoconiosis. However,

where positive findings are obtained on

biopsy, the results will constitute

evidence of the presence of

pneumoconiosis.

§ 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 or pulmonary 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

§ 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.

§ 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 § 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 Xray shall be accepted by the Office if the

X-ray is in compliance with the

requirements of § 718.102 and if such Xray 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

§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80049

or that the claim has been fraudulently

represented.

(3) If the presumptions described in

§§ 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 Xray, finds that the miner suffers or

suffered from pneumoconiosis as

defined in § 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

her dependents who would be eligible

for augmentation of the claimant’s

benefits if the claim were approved.

§ 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.

§ 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 § 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) Where total disability cannot be

shown under paragraphs (b)(2)(i), (ii), or

(iii) of this section, or where pulmonary

function tests and/or blood gas studies

are medically contraindicated, total

disability may nevertheless be found if

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 § 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 a material adverse effect on the

miner’s respiratory or pulmonary

condition; or

(ii) Materially 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 § 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 § 718.306

partial) disability due to

pneumoconiosis if no medical or other

relevant evidence exists which

80050 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 § 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

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.

§ 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 § 718.202);

(2) The miner’s pneumoconiosis arose

out of coal mine employment (see

§ 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

§ 718.304 is applicable, or

(4) Where either of the presumptions

set forth at § 718.303 or § 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

§ 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 § 725.414

concerning the operator’s opportunity to

develop evidence prior to an initial

determination.

§ 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

§ 718.301 Establishing length of

employment as a miner.

The presumptions set forth in

§§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80051

computed as provided by 20 CFR

725.101(a)(32).

§ 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

§ 718.203.)

§ 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.

§ 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 § 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.

§ 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 § 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 § 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.

§ 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 § 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 § 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

80052 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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

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 batterypowered 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 mediumspeed 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 timetemperature 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 under this

Appendix 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 H20/

liter/sec.

(iv) 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.

(v) The instrument used shall provide a

tracing of flow versus volume (flow-volume

loop) which displays the entire maximum

inspiration and the entire maximum forced

expiration. The instrument shall, in addition,

provide tracings of the volume versus time

tracing (spirogram) derived electronically

from the flow-volume loop. Tracings are

necessary to determine whether maximum

inspiratory and expiratory efforts have been

obtained during the FVC maneuver. If

maximum voluntary ventilation is measured,

the tracing shall record the individual

breaths volumes versus time.

(vi) The instrument shall be capable of

accumulating volume for a minimum of 10

seconds after the onset of exhalation.

(vii) The instrument must be capable of

being calibrated in the field with respect to

the FEV1. The volume calibration shall be

accomplished with a 3 L calibrating syringe

and should agree to within 1 percent of a 3

L calibrating volume. The linearity of the

instrument must be documented by a record

of volume calibrations at three different flow

rates of approximately 3 L/6 sec, 3 L/3 sec,

and 3 L/sec.

(viii) For measuring maximum voluntary

ventilation (MVV) the instrument shall have

a response which is flat within +/¥10

percent up to 4 Hz at flow rates up to 12

liters per second over the volume range.

(ix) The spirogram shall be recorded at a

speed of at least 20 mm/sec and a volume

excursion of at least 10mm/L. Calculation of

the FEVl from the flow-volume loop is not

acceptable. Original tracings shall be

submitted.

(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

subject shall be instructed to expire

completely, momentarily hold his breath,

place the mouthpiece in his mouth and close

the mouth firmly about the mouthpiece to

ensure no air leak. The subject will than

make a maximum inspiration from the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80053

instrument and when maximum inspiration

has been attained, without interruption, blow

as hard, fast and completely as possible for

at least 7 seconds or until a plateau has been

attained in the volume-time curve with no

detectable change in the expired volume

during the last 2 seconds of maximal

expiratory effort. A minimum of three flowvolume loops and derived spirometric

tracings shall be carried out. The patient

shall be observed throughout the study for

compliance with instructions. Inspiration

and expiration shall be checked visually for

reproducibility. 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

least 7 sec. or until an obvious plateau for at

least 2 sec. 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

hesitation (or false starts). Peak flow should

be attained at the start of expiration and the

volume-time tracing (spirogram) should have

a smooth contour revealing gradually

decreasing flow throughout expiration; 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. As individuals with

obstructive disease or rapid decline in lung

function will be less likely to achieve this

degree of reproducibility, tests not meeting

this criterion may still be submitted for

consideration in support of a claim for black

lung benefits. Failure to meet this standard

should be clearly noted in the test report by

the physician conducting or reviewing the

test.

(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 § 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 MVVs 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 +/¥1 percent of full scale.

The volume calibration shall be performed in

accordance with the method described in

paragraph (1)(vii) of this Appendix. Accuracy

of the time measurement used in determining

the FEV1 shall be checked using the

manufacturer’s stated procedure and shall be

within +/¥3 percent of actual. The

procedure described in the Appendix 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 FVC and FEV1 shall be to

determine whether or not the patient has

performed the test properly or as described

in (2)(ii) of this Appendix. The largest

recorded FVC and FEV1, corrected to BTPS,

shall be used in the analysis.

(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 or the largest accumulated volume for a

15 second period corrected to BTPS and

multiplied by four 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 §§ 718.204(b)(2)(ii) and 718.305(a), (c).

The values contained in the tables are

indicative of impairment only. They do not

establish a degree of disability except as

provided in §§ 718.204(b)(2)(ii) and

718.305(a), (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 PCO2 (mm Hg)

Arterial PO2

equal to or

less than (mm

Hg)

25 or below ........................... 75

26 .......................................... 74

27 .......................................... 73

28 .......................................... 72

Arterial PCO2 (mm Hg)

Arterial PO2

equal to or

less than (mm

Hg)

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)

1Any value.

(2) For arterial blood-gas studies performed

at test sites 3,000 to 5,999 feet above sea

level:

Arterial PCO2 (mm Hg)

Arterial PO2

equal 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)

2Any value.

(3) For arterial blood-gas studies performed

at test sites 6,000 feet or more above sea

level:

Arterial PCO2 (mm Hg)

Arterial PO2

equal 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)

3Any value.

3. Part 722 is revised as follows:

80054 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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.

§ 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

procedures and criteria for inclusion on

that list, and to provide that list.

§ 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 § 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.

§ 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 relevant

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.

§ 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 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.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80055

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.

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 [Reserved].

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 Submission of additional evidence.

725.411 Initial adjudication in Trust Fund

cases.

725.412 Operator’s response.

725.413 [Reserved].

725.414 Development of evidence.

725.415 Action by the district director after

development of 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.

725.495 Criteria for determining a

responsible operator.

725.496 Special claims transferred to the

fund.

725.497 Procedures in special claims

transferred to the 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.

Benefit Rates

725.520 Computation of benefits.

725.521 Commutation of payments; lump

sum awards.

725.522 Payments prior to final

adjudication.

Special Provisions for Operator Payments

725.530 Operator payments; generally.

725.531 Receipt for payment.

725.532 Suspension, reduction, or

termination of payments.

Increases and Reductions of Benefits

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.

725.548 Procedures applicable to

overpayments and underpayments

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.

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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.

Subpart A—General

§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80057

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

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 § 725.4(d)). No other departure from

the incorporated provisions of the

LHWCA is intended.

(k) Social Security Act provisions.

Section 402 of Part A 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,

therefore, 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

each incorporation is appropriate.

Finally, Section 422(g), contained in

part C of the Act, incorporates 42 U.S.C.

403(b)–(l).

§ 725.2 Purpose and applicability of this

part.

(a) This part sets forth the procedures

to be followed and standards to be

applied in filing, processing,

adjudicating, and paying claims filed

under part C of title IV of the Act.

(b) This part applies to all claims filed

under part C of title IV of the Act on or

after August 18, 1978 and shall also

apply to claims that were pending on

August 18, 1978.

(c) The provisions of this part reflect

revisions that became effective on

Janaury 19, 2001. This part applies to all

claims filed, and all benefits payments

made, after January 19, 2001. With the

exception of the following sections, this

part shall also apply to the adjudication

of claims that were pending on January

19, 2001: §§ 725.309, 725.310, 725.351,

725.360, 725.367, 725.406, 725.407,

725.408, 725.409, 725.410, 725.411,

725.412, 725.414, 725.415, 725.416,

725.417, 725.418, 725.421(b), 725.423,

725.454, 725.456, 725.457, 725.458,

725.459, 725.465, 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, 1999, apply to the

adjudications of claims that were

pending on January 19, 2001. For

purposes of construing the provisions of

this section, a claim shall be considered

pending on January 19, 2001 if it was

not finally denied more than one year

prior to that date.

§ 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.

80058 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

(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

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.

§ 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 § 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, 1999.

(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.

§ 725.101 Definition 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, including augmented

benefits (see § 725.520(c)). The term also

includes any expenses related to the

medical examination and testing

authorized by the district director

pursuant to § 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80059

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.

(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 § 725.350). The

term District Director is substituted for

the term Deputy Commissioner

wherever that term appears in the

regulations. 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.

(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 mine dust as a result of

such employment (see § 725.202). For

purposes of this definition, the term

does not include coke oven workers.

(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 366 days if

one of the days is February 29), or

partial periods totaling one year, during

which the miner worked in or around a

coal mine or mines for at least 125

‘‘working days.’’ A ‘‘working day’’

means any day or part of a day for

which a miner received pay for work as

a miner, but shall not include any day

for which the miner received pay while

on an approved absence, such as

vacation or sick leave. In determining

whether a miner worked for one year,

any day for which the miner received

pay while on an approved absence, such

as vacation or sick leave, may be

counted as part of the calendar year and

as partial periods totaling one year.

(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 totaling

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 totaling 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 or partial

periods totaling a 365-day period

amounting to one 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

80060 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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.

§ 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 § 702.508

of this chapter.

(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

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 (§ 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.

§ 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

§ 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 § 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 § 718.306 of this

subchapter 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 § 718.306 of this

subchapter 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 § 718.306 of

this subchapter 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

§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80061

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

§ 725.101(a)(12), (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 § 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 selfemployed miner or independent

contractor, and who otherwise meets the

requirements of this paragraph, shall be

considered a miner for the purposes of

this part.

(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

§ 718.202), and

(ii) The pneumoconiosis arose out of

coal mine employment (see § 718.203),

and

(iii) Is totally disabled (see

§ 718.204(c)), and

(iv) The pneumoconiosis contributes

to the total disability (see § 718.204(c));

and

(3) Has filed a claim for benefits in

accordance with the provisions of this

part.

§ 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 § 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, and shall submit medical

reports and other relevant evidence the

Office deems necessary, if an issue

arises pertaining to the validity of the

original award.

Conditions and Duration of Entitlement:

Miner’s Dependents (Augmented

Benefits)

§ 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

§ 725.520(c), entered into a valid

marriage without regard to this section,

with a person other than the miner.

§ 725.205 Determination of dependency;

spouse.

For the purposes of augmenting

benefits, an individual who is the

miner’s spouse (see § 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

§ 725.232); or

(b) The individual is receiving regular

contributions from the miner for

support (see § 725.233(c)); or

(c) The miner has been ordered by a

court to contribute to such individual’s

support (see § 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 § 725.204) for a period of not

less than 1 year.

§ 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

§ 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.

§ 725.207 Determination of dependency;

divorced spouse.

For the purpose of augmenting

benefits, an individual who is the

miner’s divorced spouse (§ 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 § 725.233(g)); or

80062 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

(b) The individual is receiving

substantial contributions from the miner

pursuant to a written agreement (see

§ 725.233(c) and (f)); or

(c) A court order requires the miner to

furnish substantial contributions to the

individual’s support (see § 725.233(c)

and (e)).

§ 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 § 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

§ 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 § 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

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

§ 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.

§ 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

§ 725.202 and § 725.212). An individual

who is the beneficiary’s child

(§ 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); 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 §§ 404.367—

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 nationallyrecognized 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.

§ 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.

§ 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 Survivors

§ 725.212 Conditions 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:

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80063

(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 § 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.

§ 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 § 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

(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 § 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 § 725.212.

The individual shall not be required to

reestablish the miner’s entitlement to

benefits (§ 725.212(a)(3)(i)) or the

miner’s death due to pneumoconiosis

(§ 725.212(a)(3)(ii)).

§ 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 § 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 § 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 intestate personal

property; or

(d) Such individual went through a

marriage ceremony with the miner,

resulting in a purported marriage

between them which, but for a legal

impediment (see § 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.

§ 725.215 Determination of dependency;

surviving spouse.

An individual who is the miner’s

surviving spouse (see § 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 § 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 § 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 § 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)(1)(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.

§ 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 § 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.

§ 725.217 Determination of dependency;

surviving divorced spouse.

An individual who is the miner’s

surviving divorced spouse (see

§ 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 § 725.233(g)); or

(b) The individual was receiving

substantial contributions from the miner

pursuant to a written agreement (see

§ 725.233(c) and (f)); or

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(c) A court order required the miner

to furnish substantial contributions to

the individual’s support (see

§ 725.233(c) and (e)).

§ 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

§ 725.220 and § 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

established under § 718.306 of this

subchapter 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.

§ 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 § 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

§ 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 § 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

§ 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.

(d) A child whose entitlement to

benefits has been terminated pursuant

to § 725.219(b)(2) 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 § 725.218.

The individual shall not be required to

reestablish the miner’s entitlement to

benefits (§ 725.218(a)(1)) or the miner’s

death due to pneumoconiosis

(§ 725.212(a)(2)).

§ 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 § 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 § 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

§ 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

§ 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 § 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.

§ 725.221 Determination of dependency;

child.

For the purposes of determining

whether a child was dependent upon a

deceased miner, the provisions of

§ 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.

§ 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

(§ 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

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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 § 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

§ 718.306 of part 718 on a claim filed

prior to June 30, 1982.

(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.

§ 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 § 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

§ 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 § 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

§ 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.

§ 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 § 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.

§ 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

§ 725.232); and

(b) The individual was totally

dependent on the miner for support (see

§ 725.233(h)).

§ 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

§ 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.

§ 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.

§ 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

§ 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.

§ 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.

§ 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

80066 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

law of the District of Columbia is

applied.

§ 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.

§ 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 § 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

§ 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 § 725.305, in

order for a claim to be considered, the

claimant must be alive at the time the

claim is filed.

§ 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.

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(b) Any other person shall provide a

statement describing his or her

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.

§ 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.

§ 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.

§ 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 § 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.

§ 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 § 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 § 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.

§ 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.

§ 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.

§ 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 §§ 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 § 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 § 725.310.

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(d) If a claimant files a claim under

this part more than one year after the

effective date of a final order denying a

claim previously filed by the claimant

under this part (see § 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

§§ 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, the subsequent

claim may be approved only if new

evidence submitted in connection with

the subsequent claim establishes at least

one applicable condition of entitlement.

A subsequent claim filed by a surviving

spouse, child, parent, brother, or sister

shall be denied unless the applicable

conditions of entitlement in such claim

include at least one condition unrelated

to the miner’s physical condition at the

time of his death.

(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

§ 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 § 725.4(d)), a person

may exercise the right of review

provided in paragraph (c) of § 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.

§ 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 chest X-ray interpretation,

one additional pulmonary function test,

one additional arterial blood gas study,

and one additional medical report in

support of its affirmative case along

with such rebuttal evidence and

additional statements as are authorized

by paragraphs (a)(2)(ii) and (a)(3)(ii) of

§ 725.414. 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 (§ 725.418)

or, if appropriate, deny the claim by

reason of abandonment (§ 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 (§ 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) of

this section shall be subject to collection

or offset under subpart H of this part,

provided the claimant is without fault

as defined by § 725.543. In the case of

an award which is decreased following

the initiation of modification by the

district director, no payment made in

excess of the decreased rate prior to the

date upon which the district director

initiated modification proceedings

under paragraph (a) shall be subject to

collection or offset under subpart H of

this part, provided the claimant is

without fault as defined by § 725.543. In

the case of an award which has become

final and is thereafter terminated, no

payment made prior to the date upon

which the party requested

reconsideration under paragraph (a)

shall be subject to collection or offset

under subpart H of this part. In the case

of an award which has become final and

is thereafter terminated following the

initiation of modification by the district

director, no payment made prior to the

date upon which the district director

initiated modification proceedings

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80069

under paragraph (a) shall be subject to

collection or offset under subpart H of

this part.

§ 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

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 computing any period of time

described in this part in which the

period within which to file a response

commences upon receipt of a document,

it shall be presumed, in the absence of

evidence to the contrary, that the

document was received on the seventh

day after it was mailed. 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

§ 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.

§ 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;

(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, 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.

§ 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.

80070 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

§ 725.360 Parties to proceedings.

(a) Except as provided in § 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 § 725.301;

(3) Any coal mine operator notified

under § 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 § 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.

§ 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.

§ 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 § 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

§ 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

§ 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.

§ 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.

§ 725.364 Authority of representative.

A representative, appointed and

qualified as provided in §§ 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 § 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.

§ 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.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80071

§ 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

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 § 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 § 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.

§ 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, the operator or fund liable for

the payment of benefits shall be liable

for the payment of the claimant’s

attorney’s fees where the operator or

fund, as appropriate, took action, or

acquiesced in action, that created an

adversarial relationship between itself

and the claimant. The fees payable

under this section shall include

reasonable fees for necessary services

performed prior to the creation of the

adversarial relationship. 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) The responsible operator

designated by the district director (see

§ 725.410(a)(3)) fails to accept the

claimant’s entitlement to benefits within

the 30-day period provided by

§ 725.412(b) and is ultimately

determined to be liable for benefits. The

operator shall be liable for an attorney’s

fee with respect to all necessary services

performed by the claimant’s attorney;

(2) There is no operator that may be

held liable for the payment of benefits,

and the district director issues a

schedule for the submission of

additional evidence under § 725.410.

The fund shall be liable for an attorney’s

fee with respect to all necessary services

performed by the claimant’s attorney;

(3) 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

necessary services performed by the

claimant’s attorney;

(4) A beneficiary seeks an increase in

the amount of benefits payable, and the

responsible operator or fund contests

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 necessary services performed by

the beneficiary’s attorney;

(5) 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 necessary services performed by

the beneficiary’s attorney. A request for

information clarifying the amount of

benefits payable shall not be considered

a request to decrease that amount.

(b) 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.

(c) 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 § 725.496. 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

80072 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

Internal Revenue Code (26 U.S.C.),

which was also enacted as a part of the

1981 Amendments to the Act, expressly

prohibits the fund from reimbursing an

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

§ 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.

§ 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 § 725.418 and

proceed as appropriate.

§ 725.403 [Reserved]

§ 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.

§ 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 § 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 § 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.

§ 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) As soon as possible after a miner

files an application for benefits, the

district director will provide the miner

with a list of medical facilities and

physicians in the state of the miner’s

residence and states contiguous to the

state of the miner’s residence that the

Office has authorized to perform

complete pulmonary evaluations. The

miner shall select one of the facilities or

physicians on the list, provided that the

miner may not select any physician to

whom the miner or the miner’s spouse

is related to the fourth degree of

consanguinity, and the miner may not

select any physician who has examined

or provided medical treatment to the

miner within the twelve months

preceding the date of the miner’s

application. The district director will

make arrangements for the miner to be

given a complete pulmonary evaluation

by that facility or physician. The results

of the complete pulmonary evaluation

shall not be counted as evidence

submitted by the miner under § 725.414.

(c) 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

the deficiencies in the report are the

result of a lack of effort on the part of

the miner, the miner will be afforded

one additional opportunity to produce a

satisfactory result. 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.

(d) After the physician completes the

report authorized by paragraph (a), the

district director will inform the miner

that he may elect to have the results of

the objective testing sent to his treating

physician for use in preparing a medical

opinion. The district director will also

inform the claimant that any medical

opinion submitted by his treating

physician will count as one of the two

medical opinions that the miner may

submit under § 725.414 of this part.

(e) 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80073

an action brought under section 424 of

the Act and § 725.603 of this part.

§ 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) The district director may identify

one or more operators potentially liable

for the payment of benefits in

accordance with the criteria set forth in

§ 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 § 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 § 725.410(a)(3), 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. The district

director may not notify additional

operators of their potential liability after

a case has been referred to the Office of

Administrative Law Judges, unless the

case was referred for a hearing to

determine whether the claim was

properly denied as abandoned pursuant

to § 725.409.

§ 725.408 Operator’s response to

notification.

(a)(1) An operator which receives

notification under § 725.407 shall,

within 30 days of receipt, file a response

indicating 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

§ 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 § 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 any of the

grounds set forth in paragraph (a)(2).

(b)(1) Within 90 days of the date on

which it receives notification under

§ 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.

§ 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,

(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)(1) If the district director

determines that a denial by reason of

abandonment under paragraphs (a)(1)

through (3) of this section 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. Such notification shall be

served on the claimant and all other

parties to the claim by certified mail.

(2) In any case in which a claimant

has failed to attend an informal

conference and has not provided the

district director with his reasons for

failing to attend, the district director

shall ask the claimant to explain his

absence. In considering whether the

claimant had good cause for his failure

to attend the conference, the district

director shall consider all relevant

circumstances, including the age,

education, and health of the claimant, as

well as the distance between the

claimant’s residence and the location of

the conference. If the district director

concludes that the claimant had good

cause for failing to attend the

conference, he may continue processing

the claim, including, where appropriate

under § 725.416, the scheduling of an

informal conference. If the claimant

does not supply the district director

with his reasons for failing to attend the

conference within 30 days of the date of

the district director’s request, or the

district director concludes that the

reasons supplied by the claimant do not

establish good cause, the district

director shall notify the claimant that

the claim has been denied by reason of

abandonment. Such notification shall be

served on the claimant and all other

parties to the claim by certified mail.

(c) The denial of a claim by reason of

abandonment shall become effective

and final unless, within 30 days after

the denial is issued, the claimant

requests a hearing. Following the

expiration of the 30-day period, a new

claim may be filed at any time pursuant

to § 725.309. For purposes of § 725.309,

80074 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

a denial by reason of abandonment shall

be deemed a finding that the claimant

has not established any applicable

condition of entitlement. If the claimant

timely requests a hearing, the district

director shall refer the case to the Office

of Administrative Law Judges in

accordance with § 725.421. Except upon

the motion or written agreement of the

Director, the hearing will be limited to

the issue of whether the claim was

properly denied by reason of

abandonment. If the hearing is limited

to the issue of abandonment and the

administrative law judge determines

that the claim was not properly denied

by reason of abandonment, he shall

remand the claim to the district director

for the completion of administrative

processing.

§ 725.410 Submission of additional

evidence.

(a) After the district director

completes the development of medical

evidence under § 725.405 of this part,

including the complete pulmonary

evaluation authorized by § 725.406, and

receives the responses and evidence

submitted pursuant to § 725.408, he

shall issue a schedule for the

submission of additional evidence. The

schedule shall contain the following

information:

(1) If the claim was filed by, or on

behalf of, a miner, the schedule shall

contain a summary of the complete

pulmonary evaluation administered

pursuant to § 725.406. If the claim was

filed by, or on behalf of, a survivor, the

schedule shall contain a summary of

any medical evidence developed by the

district director pursuant to

§ 725.405(c).

(2) The schedule shall contain the

district director’s preliminary analysis

of the medical evidence. If the district

director believes that the evidence fails

to establish any necessary element of

entitlement, he shall inform the

claimant of the element of entitlement

not established and the reasons for his

conclusions and advise the claimant

that, unless he submits additional

evidence, the district director will issue

a proposed decision and order denying

the claim.

(3) The schedule shall contain the

district director’s designation of a

responsible operator liable for the

payment of benefits. In the event that

the district director has designated as

the responsible operator an employer

other than the employer who last

employed the claimant as a miner, the

district director shall include, with the

schedule, a copy of the statements

required by § 725.495(d) of this part.

The district director may, in his

discretion, dismiss as parties any of the

operators notified of their potential

liability pursuant to § 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

§ 725.407(d).

(4) The schedule shall notify the

claimant and the designated responsible

operator that they have the right to

obtain further adjudication of the claim

in accordance with this subpart, and

that they have the right to submit

additional evidence in accordance with

this subpart. The schedule shall also

notify the claimant that he has the right

to obtain representation, under the

terms set forth in subpart D, in order to

assist him. In a case in which the

district director has designated a

responsible operator pursuant to

paragraph (a)(3), the schedule shall

further notify the claimant that if the

operator fails to accept the claimant’s

entitlement to benefits within the time

limit provided by § 725.412, the cost of

obtaining additional medical and other

necessary evidence, along with a

reasonable attorney’s fee, shall be

reimbursed by the responsible operator

in the event that the claimant

establishes his entitlement to benefits

payable by that operator. In a case in

which there is no operator liable for the

payment of benefits, the schedule shall

notify the claimant that the cost of

obtaining additional medical and other

necessary evidence, along with a

reasonable attorney’s fee, shall be

reimbursed by the fund.

(b) The schedule shall allow all

parties not less than 60 days within

which to submit additional evidence,

including evidence relevant to the

claimant’s eligibility for benefits and

evidence relevant to the liability of the

designated responsible operator, 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 § 725.414

in order to be admitted into the record.

(c) The district director shall serve a

copy of the schedule, together with a

copy of all of the evidence developed,

on the claimant, the designated

responsible operator, and all other

operators which received notification

pursuant to § 725.407. The schedule

shall be served on each party by

certified mail.

§ 725.411 Initial adjudication in Trust Fund

cases.

Notwithstanding the requirements of

§ 725.410 of this part, if the district

director concludes that the results of the

complete pulmonary evaluation support

a finding of eligibility, and that there is

no operator responsible for the payment

of benefits, the district director shall

issue a proposed decision and order in

accordance with § 725.418 of this part.

§ 725.412 Operator’s response.

(a)(1) Within 30 days after the district

director issues a schedule pursuant to

§ 725.410 of this part containing a

designation of the responsible operator

liable for the payment of benefits, that

operator shall file a response with

regard to its liability. The response shall

specifically indicate whether the

operator agrees or disagrees with the

district director’s designation.

(2) If the responsible operator

designated by the district director does

not file a timely response, it shall be

deemed to have accepted the district

director’s designation 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.

(b) The responsible operator

designated by the district director may

also file a statement accepting

claimant’s entitlement to benefits. If that

operator fails to file a timely response to

the district director’s designation, the

district director shall, upon receipt of

such a statement, issue a proposed

decision and order in accordance with

§ 725.418 of this part. If the operator

fails to file a statement accepting the

claimant’s entitlement to benefits within

30 days after the district director issues

a schedule pursuant to § 725.410 of this

part, the operator shall be deemed to

have contested the claimant’s

entitlement.

§ 725.413 [Reserved].

§ 725.414 Development of evidence.

(a) Medical evidence.

(1) For purposes of this section, a

medical report shall consist of a

physician’s written assessment of the

miner’s respiratory or pulmonary

condition. A medical report may be

prepared by a physician who examined

the miner and/or reviewed the available

admissible evidence. A physician’s

written assessment of a single objective

test, such as a chest X-ray or a

pulmonary function test, shall not be

considered a medical report for

purposes of this section.

(2)(i) The claimant shall be entitled to

submit, in support of his affirmative

case, no more than two chest X-ray

interpretations, the results of no more

than two pulmonary function tests, the

results of no more than two arterial

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80075

blood gas studies, no more than one

report of an autopsy, no more than one

report of each biopsy, and no more than

two medical reports. Any chest X-ray

interpretations, pulmonary function test

results, blood gas studies, autopsy

report, biopsy report, and physicians’

opinions that appear in a medical report

must each be admissible under this

paragraph or paragraph (a)(4) of this

section.

(ii) The claimant shall be entitled to

submit, in rebuttal of the case presented

by the party opposing entitlement, no

more than one physician’s

interpretation of each chest X-ray,

pulmonary function test, arterial blood

gas study, autopsy or biopsy submitted

by the designated responsible operator

or the fund, as appropriate, under

paragraph (a)(3)(i) or (a)(3)(iii) of this

section and by the Director pursuant to

§ 725.406. In any case in which the

party opposing entitlement has

submitted the results of other testing

pursuant to § 718.107, the claimant shall

be entitled to submit one physician’s

assessment of each piece of such

evidence in rebuttal. In addition, where

the responsible operator or fund has

submitted rebuttal evidence under

paragraph (a)(3)(ii) or (a)(3)(iii) of this

section with respect to medical testing

submitted by the claimant, the claimant

shall be entitled to submit an additional

statement from the physician who

originally interpreted the chest X-ray or

administered the objective testing.

Where the rebuttal evidence tends to

undermine the conclusion of a

physician who prepared a medical

report submitted by the claimant, the

claimant shall be entitled to submit an

additional statement from the physician

who prepared the medical report

explaining his conclusion in light of the

rebuttal evidence.

(3)(i) The responsible operator

designated pursuant to § 725.410 shall

be entitled to obtain and submit, in

support of its affirmative case, no more

than two chest X-ray interpretations, the

results of no more than two pulmonary

function tests, the results of no more

than two arterial blood gas studies, no

more than one report of an autopsy, no

more than one report of each biopsy,

and no more than two medical reports.

Any chest X-ray interpretations,

pulmonary function test results, blood

gas studies, autopsy report, biopsy

report, and physicians’ opinions that

appear in a medical report must each be

admissible under this paragraph or

paragraph (a)(4) of this section. In

obtaining such evidence, the

responsible operator may not require the

miner to travel more than 100 miles

from his or her place of residence, or the

distance traveled by the miner in

obtaining the complete pulmonary

evaluation provided by § 725.406 of this

part, whichever is greater, 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 the

designated responsible 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 the

designated responsible operator, the

miner’s claim may be denied by reason

of abandonment. (See § 725.409 of this

part).

(ii) The responsible operator shall be

entitled to submit, in rebuttal of the case

presented by the claimant, no more than

one physician’s interpretation of each

chest X-ray, pulmonary function test,

arterial blood gas study, autopsy or

biopsy submitted by the claimant under

paragraph (a)(2)(i) of this section and by

the Director pursuant to § 725.406. In

any case in which the claimant has

submitted the results of other testing

pursuant to § 718.107, the responsible

operator shall be entitled to submit one

physician’s assessment of each piece of

such evidence in rebuttal. In addition,

where the claimant has submitted

rebuttal evidence under paragraph

(a)(2)(ii) of this section, the responsible

operator shall be entitled to submit an

additional statement from the physician

who originally interpreted the chest Xray or administered the objective

testing. Where the rebuttal evidence

tends to undermine the conclusion of a

physician who prepared a medical

report submitted by the responsible

operator, the responsible operator shall

be entitled to submit an additional

statement from the physician who

prepared the medical report explaining

his conclusion in light of the rebuttal

evidence.

(iii) In a case in which the district

director has not identified any

potentially liable operators, or has

dismissed all potentially liable

operators under § 725.410(a)(3), the

district director shall be entitled to

exercise the rights of a responsible

operator under this section, except that

the evidence obtained in connection

with the complete pulmonary

evaluation performed pursuant to

§ 725.406 shall be considered evidence

obtained and submitted by the Director,

OWCP, for purposes of paragraph

(a)(3)(i) of this section. In a case

involving a dispute concerning medical

benefits under § 725.708 of this part, the

district director shall be entitled to

develop medical evidence to determine

whether the medical bill is compensable

under the standard set forth in § 725.701

of this part.

(4) Notwithstanding the limitations in

paragraphs (a)(2) and (a)(3) of this

section, any record of a miner’s

hospitalization for a respiratory or

pulmonary or related disease, or

medical treatment for a respiratory or

pulmonary or related disease, 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.

(b) Evidence pertaining to liability. (1)

Except as provided by § 725.408(b)(2),

the designated responsible operator may

submit evidence to demonstrate that it

is not the potentially liable operator that

most recently employed the claimant.

(2) Any other party may submit

evidence regarding the liability of the

designated 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. A physician who

prepared a medical report admitted

under this section may testify with

respect to the claim at any formal

hearing conducted in accordance with

subpart F of this part, or by deposition.

If a party has submitted fewer than two

medical reports as part of that party’s

affirmative case under this section, a

physician who did not prepare a

medical report may testify in lieu of

such a medical report. The testimony of

such a physician shall be considered a

medical report for purposes of the

limitations provided by this section. A

party may offer the testimony of no

more than two physicians under the

provisions of this section unless the

adjudication officer finds good cause

under paragraph (b)(1) of § 725.456 of

this part. 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 potential witness whose

testimony pertains to the liability of a

potentially liable operator or the

80076 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

designated responsible operator. Absent

such notice, the testimony of a witness

relevant to the liability of a potentially

liable operator or the designated

responsible operator shall not be

admitted in any hearing conducted with

respect to the claim unless the

administrative law judge finds that the

lack of notice should be excused due to

extraordinary circumstances.

(d) Except to the extent permitted by

§ 725.456 and § 725.310(b), the

limitations set forth in this section shall

apply to all proceedings conducted with

respect to a claim, and no documentary

evidence pertaining to liability 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.

§ 725.415 Action by the district director

after development of evidence.

(a) At the end of the period permitted

under § 725.410(b) for the submission of

evidence, the district director shall

review the claim on the basis of all

evidence submitted in accordance with

§ 725.414.

(b) After review of all evidence

submitted, the district director may

issue another schedule for the

submission of additional evidence

pursuant to § 725.410, identifying

another potentially liable operator as the

responsible operator liable for the

payment of benefits. In such a case, the

district director shall not permit the

development or submission of any

additional medical evidence until after

he has made a final determination of the

identity of the responsible operator

liable for the payment of benefits. If the

operator who is finally determined to be

the responsible operator has not had the

opportunity to submit medical evidence

pursuant to § 725.410, the district

director shall allow the designated

responsible operator and the claimant

not less than 60 days within which to

submit evidence relevant to the

claimant’s eligibility for benefits. The

designated responsible operator may

elect to adopt any medical evidence

previously submitted by another

operator as its own evidence, subject to

the limitations of § 725.414. The district

director may also schedule a conference

in accordance with § 725.416, issue a

proposed decision and order in

accordance with § 725.418, or take such

other action as the district director

considers appropriate.

§ 725.416 Conferences.

(a) At the conclusion of the period

permitted by § 725.410(b) of this part 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. Any

conference conducted pursuant to this

paragraph shall be held no later than 90

days after the conclusion of the period

permitted by § 725.410(b) of this part for

the submission of evidence, unless one

of the parties requests that the time

period be extended for good cause

shown. If the district director is unable

to hold the conference within the time

period permitted by this paragraph, he

shall proceed to issue a proposed

decision and order under § 725.418 of

this part.

(b) The district director shall notify

the parties of a definite time and place

for the conference. The district director

shall advise the parties that they have a

right to representation at the conference,

by an attorney or a lay representative,

and that no conference shall take place

unless the parties are represented. A

coal mine operator which is selfinsured, or which is covered by a policy

of insurance for the claim for which a

conference is scheduled, shall be

deemed to be represented. The

notification shall set forth the specific

reasons why the district director

believes that a conference will assist in

the voluntary resolution of any issue

raised with respect to the claim. No

sanction may be imposed under

paragraph (c) of this section unless the

record contains a notification that meets

the requirements of this section. The

district director may in his or her

discretion, or on the motion of any

party, cancel a conference or allow any

or all of the parties to participate by

telephone.

(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 § 725.409(b)(2) 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 paragraph (b),

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.

§ 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 appropriate cases, 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 § 725.414.

The district director may also notify

additional operators of their potential

liability pursuant to § 725.407, or issue

another schedule for the submission of

additional evidence pursuant to

§ 725.410, designating another

potentially liable operator as the

responsible operator liable for the

payment of benefits, in order to allow

that operator an opportunity to submit

evidence relevant to its liability for

benefits as well as the claimant’s

eligibility for benefits.

(c) Within 20 days after the

termination of all conference

proceedings, the district director shall

prepare and send to the parties a

proposed decision and order pursuant

to § 725.418 of this part.

§ 725.418 Proposed decision and order.

(a) Within 20 days after the

termination of all informal conference

proceedings, or, if no informal

conference is held, at the conclusion of

the period permitted by § 725.410(b) 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 § 725.419.

A proposed decision and order may be

issued by the district director at any

time during the adjudication of any

claim if:

(1) Issuance is authorized or required

by this part; or,

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80077

(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. It shall be served on

all parties to the claim by certified mail.

(c) The proposed decision and order

shall contain a notice of the right of any

interested party to request a formal

hearing before the Office of

Administrative Law Judges. If the

proposed decision and order is a denial

of benefits, and the claimant has

previously filed a request for a hearing,

the proposed decision and order shall

notify the claimant that the case will be

referred for a hearing pursuant to the

previous request unless the claimant

notifies the district director that he no

longer desires a hearing. If the proposed

decision and order is an award of

benefits, and the designated responsible

operator has previously filed a request

for a hearing, the proposed decision and

order shall notify the operator that the

case will be referred for a hearing

pursuant to the previous request unless

the operator notifies the district director

that it no longer desires a hearing.

(d) The proposed decision and order

shall reflect the district director’s final

designation of the responsible operator

liable for the payment of benefits. No

operator may be finally designated as

the responsible operator unless it has

received notification of its potential

liability pursuant to § 725.407, and the

opportunity to submit additional

evidence pursuant to § 725.410. The

district director shall dismiss, as parties

to the claim, all other potentially liable

operators that received notification

pursuant to § 725.407 and that were not

previously dismissed pursuant to

§ 725.410(a)(3).

§ 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

§ 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

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 § 725.310.

§ 725.420 Initial determinations.

(a) Section 9501(d)(1)(A)(1) of the

Internal Revenue Code (26 U.S.C.)

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 § 725.415,

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 § 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

§ 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.

§ 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 evidentiary

development and adjudication without

having resolved all contested issues, 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, and any schedule for the

submission of additional evidence

issued pursuant to § 725.410 designating

a potentially liable operator as the

responsible operator;

(4) All medical evidence submitted to

the district director under this part by

the claimant and the potentially liable

operator designated as the responsible

operator in the proposed decision and

order issued pursuant to § 725.418, or

the fund, as appropriate, subject to the

limitations of § 725.414 of this part; this

evidence shall include the results of any

medical examination or test conducted

pursuant to § 725.406, and all evidence

relevant to the liability of the

responsible operator 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

80078 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

may be sent to the party upon the

payment of a copying fee to be

determined by the district director.

§ 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.

§ 725.423 Extensions of time.

Except for the 30-day time limit set

forth in § 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

§ 725.450 Right to a hearing.

Any party to a claim (see § 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.

§ 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 § 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 § 725.421.

§ 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.

(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.

§ 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.

§ 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.

§ 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

§ 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 § 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.

§ 725.456 Introduction of documentary

evidence.

(a) All documents transmitted to the

Office of Administrative Law Judges

under § 725.421 shall be placed into

evidence by the administrative law

judge, subject to objection by any party.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80079

(b)(1) Documentary evidence

pertaining to the liability of a

potentially liable operator and/or the

identification of a responsible operator

which was not submitted to the district

director shall not be admitted into the

hearing record in the absence of

extraordinary circumstances. Medical

evidence in excess of the limitations

contained in § 725.414 shall not be

admitted into the hearing record in the

absence of good cause.

(2) Subject to the limitations in

paragraph (b)(1) of this section, any

other documentary material, including

medical reports, which was not

submitted to the district director, may

be received in evidence subject to the

objection of any party, if such evidence

is sent to all other parties at least 20

days before a hearing is held in

connection with the claim.

(3) Documentary evidence, which is

not exchanged with the parties in

accordance with this paragraph, may be

admitted at the hearing with the written

consent of the parties or on the record

at the hearing, or upon a showing of

good cause why such evidence was not

exchanged in accordance with this

paragraph. If documentary evidence is

not exchanged in accordance with

paragraph (b)(2) of this section and the

parties do not waive the 20-day

requirement or good cause is not shown,

the administrative law judge shall either

exclude the late evidence from the

record or remand the claim to the

district director for consideration of

such evidence.

(4) A medical report which is not

made available to the parties in

accordance with paragraph (b)(2) of this

section shall not be admitted into

evidence in any case unless the hearing

record is kept open for at least 30 days

after the hearing to permit the parties to

take such action as each considers

appropriate in response to such

evidence. If, in the opinion of the

administrative law judge, evidence is

withheld from the parties for the

purpose of delaying the adjudication of

the claim, the administrative law judge

may exclude such evidence from the

hearing record and close the record at

the conclusion of the hearing.

(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

§ 725.406, or any part thereof, fails to

comply with the applicable quality

standards, or fails to address the

relevant conditions of entitlement (see

§ 725.202(d)(2)(i) through (iv)) in a

manner which permits resolution of the

claim, 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.

§ 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, including any

physician, regardless of whether the

physician has previously prepared a

medical report, 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, or

pursuant to deposition or interrogatory

under § 725.458, unless that person

meets the requirements of § 725.414(c).

(1) In the case of a witness offering

testimony relevant to the liability of the

responsible operator, in the absence of

extraordinary circumstances, the

witness must have been identified as a

potential hearing witness while the

claim was pending before the district

director.

(2) In the case of a physician offering

testimony relevant to the physical

condition of the miner, such physician

must have prepared a medical report.

Alternatively, in the absence of a

showing of good cause under

§ 725.456(b)(1) of this part, a physician

may offer testimony relevant to the

physical condition of the miner only to

the extent that the party offering the

physician’s testimony has submitted

fewer medical reports than permitted by

§ 725.414. Such physician’s opinion

shall be considered a medical report

subject to the limitations of § 725.414.

(d) A physician whose testimony is

permitted under this section may testify

as to any other medical evidence of

record, but shall not be permitted to

testify as to any medical evidence

relevant to the miner’s condition that is

not admissible.

§ 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

§ 725.457(d).

§ 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

a hearing or deposition, any other party

may subpoena the witness for crossexamination. The administrative law

judge shall authorize the least intrusive

and expensive means of crossexamination as he deems appropriate

and necessary to the full and true

80080 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

disclosure of facts. If such witness is

required to attend the hearing, give a

deposition or respond to interrogatories

for cross-examination purposes, the

proponent of the witness shall pay the

witness’ fee. If the claimant is the

proponent of the witness whose crossexamination is sought, and

demonstrates, within time limits

established by the administrative law

judge, that he would be deprived of

ordinary and necessary living expenses

if required to pay the witness fee and

mileage necessary to produce that

witness for cross-examination, the

administrative law judge shall apportion

the costs of such cross-examination

among the parties to the case. The

administrative law judge shall not

apportion any costs against the fund in

a case in which the district director has

designated a responsible operator,

except that the fund shall remain liable

for any costs associated with the crossexamination of the physician who

performed the complete pulmonary

evaluation pursuant to § 725.406.

(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.

(d) A claimant shall be considered to

be deprived of funds required for

ordinary and necessary living expenses

for purposes of paragraph (b) of this

section where payment of the projected

fee and mileage would meet the

standards set forth at 20 CFR 404.508.

§ 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.

§ 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 § 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

§ 725.465).

§ 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.

§ 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 § 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.

§ 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.

§ 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

(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 § 725.4(d)).

(b) A party who is not a proper party

to the claim (see § 725.360) shall be

dismissed by the administrative law

judge. The administrative law judge

shall not dismiss the operator

designated as the responsible operator

by the district director, except upon the

motion or written agreement of the

Director.

(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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80081

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 § 725.522, except upon the motion

or written agreement of the Director.

§ 725.466 Order of dismissal.

(a) An order dismissing a claim shall

be served on the parties in accordance

with § 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 § 725.522, and the order of

dismissal shall, if appropriate, order the

claimant to reimburse the fund for all

benefits paid to the claimant.

§ 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.

§ 725.476 Issuance of decision and order.

Within 20 days after the official

termination of the hearing (see

§ 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.

§ 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.

§ 725.478 Filing and service of decision

and order.

On the date of issuance of a decision

and order under § 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.

§ 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 § 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

§ 725.481).

(b) Any party may, within 30 days

after the filing of a decision and order

under § 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.

§ 725.480 Modification of decisions and

orders.

A party who is dissatisfied with a

decision and order which has become

final in accordance with § 725.479 may

request a modification of the decision

and order if the conditions set forth in

§ 725.310 are met.

§ 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 § 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.

§ 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.

§ 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

instituted or continued such

proceedings.

Subpart G—Responsible Coal Mine

Operators

§ 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

80082 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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

§ 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 § 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.

§ 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 mine dust as a result of

such employment (see § 725.202);

(ii) In accordance with the provisions

of § 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

§ 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 § 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 mine dust

during the course of employment. The

presumption may be rebutted by a

showing that the employee was not

exposed to coal mine 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.

§ 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 § 725.494. If the

prior operator does not meet the

conditions set forth in § 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

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 § 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80083

vested in a person other than the prior

operator.

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. It is

the specific intention of this paragraph

to disregard any financial arrangement

or business entity devised by the actual

owners or operators of a coal mine or

coal mine-related enterprise to avoid the

payment of benefits to miners who,

based upon the economic reality of their

relationship to this enterprise, are, in

fact, employees of the enterprise.

(2) The payment of wages or salary

shall be prima facie evidence of the

right to direct, control, or supervise an

individual’s work. 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 § 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

§ 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 selfemployed 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.

§ 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

arose 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, was an

operator for any period after June 30,

1973.

(c) The miner was 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

(§ 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, included at least

one working day (§ 725.101(a)(32)) after

December 31, 1969.

(e) The operator is 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

80084 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

insolvent and its obligations for the

claim are not otherwise guaranteed;

(2) The operator qualified as a selfinsurer 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 selfinsurer or the security given by the

operator pursuant to § 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 § 725.606.

§ 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

§ 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) of this

section; and

(iii) Third, to any other potentially

liable operator which may be deemed to

have been the miner’s most recent

employer pursuant to § 725.493.

(3) If the operator that most recently

employed the miner may not be

considered a potentially liable operator,

as determined in accordance with

§ 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.

(4) If the miner’s most recent

employment by an operator ended while

the operator was authorized to selfinsure its liability under part 726 of this

title, and that operator no longer

possesses sufficient assets to secure the

payment of benefits, the provisions of

paragraph (a)(3) shall be inapplicable

with respect to any operator that

employed the miner only before he was

employed by such self-insured operator.

If no operator that employed the miner

after his employment with the selfinsured operator meets the conditions of

§ 725.494, the claim of the miner or his

survivor shall be the responsibility of

the Black Lung Disability Trust Fund.

(b) Except as provided in this section

and § 725.408(a)(3), 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 § 725.410 (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

§ 725.494(e).

(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 § 725.606; 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

§ 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

§ 725.606. 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 § 725.421 in which the operator

finally designated as responsible

pursuant to § 725.418(d) 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

designation. If the reasons include the

most recent employer’s failure to meet

the conditions of § 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 § 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.

§ 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

dependent of a miner, unless such

claims were required to be merged by

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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.

§ 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 § 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

§ 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

§ 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 § 725.4(d)).

§ 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 § 725.418 (see § 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 § 725.310.

(2) A proposed order issued by a

district director pursuant to § 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

§ 725.419). An order issued by an

administrative law judge becomes

effective when it is filed in the office of

the district director (see § 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 § 725.520, shall be

due on the fifteenth 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 fifteenth day

of February.

(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

80086 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

payable for periods prior to the effective

date of the order, in addition to any

interest payable for such periods (see

§ 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 to the

computation.

(c) Benefits are payable for monthly

periods and shall be paid directly to an

eligible claimant or his or her

representative payee (see § 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.

§ 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

§ 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) of this

section, the date from which benefits are

payable for any claim approved under

part 727 shall be determined in

accordance with § 727.302 (see

§ 725.4(d)).

(b) Miner’s claim. Benefits are payable

to a miner who is entitled 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. Benefits are

payable to a survivor who is entitled

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

§ 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 in which

the claimant requested modification.

(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 § 727.303 (see § 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.

§ 725.504 Payments to a claimant

employed as a miner.

(a) In the case of a claimant who is

employed as a miner (see § 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 § 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.

§ 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.

§ 725.506 Payment on behalf of another;

‘‘legal guardian’’ defined.

Benefits are paid only to the

beneficiary, his or her representative

payee (see § 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.

§ 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.

§ 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

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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80087

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 § 725.511.

§ 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 § 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 lllllllllll

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.

§ 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.

§ 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.

§ 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.

§ 725.515 Assignment and exemption from

claims of creditors.

(a) Except as provided by the Act and

this part, no assignment, release, or

commutation of benefits due or payable

under this part by a responsible operator

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.

(b) Notwithstanding any other

provision of law, benefits due from, or

payable by, the Black Lung Disability

Trust Fund under the Act and this part

to a claimant shall be subject to legal

process brought for the enforcement

against the claimant of his or her legal

obligations to provide child support or

make alimony payments to the same

extent as if the fund was a private

person.

Benefit Rates

§ 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 371⁄2 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 371⁄2

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

80088 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

beneficiary entitled to benefits, the

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.

§ 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.

§ 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 § 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 §§ 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

§ 725.540 and may be recovered in

accordance with the provisions of this

subpart.

Special Provisions for Operator

Payments

§ 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

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claimant, shall be paid by the operator

or carrier immediately when they

become due (see § 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

§ 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 § 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.

§ 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.

§ 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,

§§ 725.306 and 725.310, or this subpart

(see also §§ 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

§ 725.533 Modification of benefits

amounts; general.

(a) Under certain circumstances, the

amount of monthly benefits as

computed in § 725.520 or lump-sum

award (§ 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

§ 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) An adjustment in a beneficiary’s

monthly benefit may be required

because an overpayment or

underpayment has been made to such

beneficiary (see §§ 725.540–725.546).

(c) 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.

(d) 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.

(e) 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

subject such benefit to reductions,

suspension, or termination as the case

may be.

§ 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.

§ 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

80090 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 41⁄3 and a

biweekly benefit is multiplied by 21⁄6 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.

§ 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 §§ 404.428 through 404.456 of this

title).

§ 725.537 Reductions; retroactive effect of

an additional claim for benefits.

Except as provided in § 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.

§ 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.

§ 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

§ 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 § 725.533);

(4) A payment under this part made

to a resident of a State whose residents

are not entitled to benefits (see

§§ 725.402 and 725.403);

(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 § 725.4(d)) of this title or as

provided in § 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.

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80091

(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.

§ 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.

§ 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.

§ 725.543 Standards for waiver of

adjustment or recovery.

The standards for determining the

applicability of the criteria listed in

§ 725.542 shall be the same as those

applied by the Social Security

Administration under §§ 404.506

through 404.512 of this title.

§ 725.544 Collection and compromise of

claims for overpayment.

(a) General effect of 31 U.S.C. 3711. In

accordance with 31 U.S.C. 3711 and

applicable regulations, claims by the

Office against an individual for recovery

of an overpayment under this part not

exceeding the sum of $100,000,

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.

§ 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).

80092 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

(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.

§ 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.

§ 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.

§ 725.548 Procedures applicable to

overpayments and underpayments.

(a) 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.

(b) 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

§ 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 § 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 § 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

§ 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

§ 725.605. In all cases payments in

addition to compensation (see

§ 725.607) and interest (see § 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.

§ 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.

§ 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 § 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 § 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.

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(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 (26 U.S.C.).

(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

(26 U.S.C.) 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 (26 U.S.C.).

(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.

§ 725.604 Enforcement of final awards.

Notwithstanding the provisions of

§ 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.

§ 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.

(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.

§ 725.606 Security for the payment of

benefits.

(a) Following the issuance of an

effective order by a district director (see

§ 725.418), administrative law judge (see

§ 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 § 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 §§ 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

§ 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

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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) of this section, 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 (b). Such securities shall

comply with the requirements of

§§ 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 § 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 § 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 a Federal

Reserve Bank 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)

of this section, 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 § 725.609 shall be

applicable to the president, secretary,

and treasurer of such employer.

§ 725.607 Payments in addition to

compensation.

(a) If any benefits payable under the

terms of an award by a district director

(§ 725.419(d)), a decision and order filed

and served by an administrative law

judge (§ 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.

§ 725.608 Interest.

(a)(1) In any case in which an operator

fails to pay benefits that are due

(§ 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 § 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.

(3) In any case in which an operator

is liable for the payment of additional

compensation (§ 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 or medical provider

shall not be entitled to interest for any

period following the date on which the

beneficiary or medical provider received

payment of any benefits from the fund

pursuant to § 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80095

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 § 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 (26

U.S.C.) 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

(26 U.S.C.).

§ 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 § 726.4, and

the operator has not secured its liability

for the claim in accordance with

§ 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

(§ 725.494(e)), against any operator

which became a successor operator with

respect to the liable operator (§ 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

(§ 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.

§ 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 of

this subchapter 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.

§ 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

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 of this

subchapter, as appropriate. The

maximum penalty applicable to any

violation of this paragraph that takes

place after January 19, 2001 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.

Subpart J—Medical Benefits and

Vocational Rehabilitation

§ 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

§ 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

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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 disability requires.

(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 a medical

service or supply, 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

party liable for the payment of benefits

may rebut the presumption by

producing credible evidence that the

medical service or supply provided was

for a pulmonary disorder apart from

those previously associated with the

miner’s disability, or was beyond that

necessary to effectively treat a covered

disorder, or was not for a pulmonary

disorder at all.

(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 defeat a request for coverage of any

medical service or supply under this

subpart. In determining whether the

treatment is compensable, the opinion

of the miner’s treating physician may be

entitled to controlling weight pursuant

to § 718.104(d). A finding that a medical

service or supply is not covered under

this subpart shall not otherwise affect

the miner’s entitlement to benefits.

§ 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) 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

§ 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

§ 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 § 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

§ 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

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.

§ 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.

§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80097

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.

§ 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.

§ 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 § 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.

§ 725.707 Reports of physicians and

supervision of medical care.

(a) Within 30 days following the first

medical or surgical treatment provided

under § 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.

§ 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 § 727.405 of this subchapter

(see § 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 § 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.

§ 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.

§ 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 §§ 702.501

through 702.508 of this chapter as is

appropriate.

5. Part 726 is 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 selfinsure.

726.102 Application for authority to

become a self-insurer; how filed;

information to be submitted.

726.103 Application for authority to selfinsure; effect of regulations contained in

this part.

80098 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 selfinsure.

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 selfinsurer; reauthorization.

726.115 Revocation of authorization to selfinsure.

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

§ 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 subchapter) 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).

§ 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 mine 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.

§ 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 mine 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 mine operators prescribed in part

725 of this subchapter are hereby made

applicable, as appropriate, to this part

726.

(b) If the provisions of this part appear

to conflict with any provision of any

other part in this subchapter, the

apparently conflicting provisions

should be read harmoniously to the

fullest extent possible. If a harmonious

interpretation is not possible, the

provisions of this part should be applied

to govern the responsibilities and

obligations of coal mine operators to

secure the payment of black lung

benefits as prescribed by the Act. The

provisions of this part do not apply to

matters falling outside the scope of this

part.

§ 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

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

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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.

§ 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.

§ 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

§ 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.

§ 726.8 Definitions.

In addition to the definitions

provided in part 725 of this subchapter,

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

subchapter.

(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. It is

the specific intention of this paragraph

to disregard any financial arrangement

or business entity devised by the actual

owners or operators of a coal mine or

coal mine-related enterprise to avoid the

payment of benefits to miners who,

based upon the economic reality of their

relationship to this enterprise, are, in

fact, employees of the enterprise.

Subpart B—Authorization of SelfInsurers

§ 726.101 Who may be authorized to selfinsure.

(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) The 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) The operator must demonstrate the

administrative capacity to fully service

such claims as may be filed against him;

and,

(3) The 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 § 726.104) and in an amount

to be determined by the Office (see

§ 726.105); and

(5) No operator with fewer than 5 fulltime 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 in

accordance with this subpart.

§ 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

80100 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 § 726.110

and the security deposit shall be

respectively filed by and deposited in

the name of the applicant only.

§ 726.103 Application for authority to selfinsure; 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 under this subpart, 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.

§ 726.104 Action by the Office upon

application of operator.

(a) Upon receipt of a completed

application for authorization to selfinsure, the Office shall, after

examination of the information

contained in the application, either

deny the request 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

§ 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 §§ 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 the Internal

Revenue Code (26 U.S.C.).

(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.

§ 726.105 Fixing the amount of security.

The Office shall require the amount of

security which it deems 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. The Office shall also consider

such other factors as it considers

relevant to any particular case. The

amount of security which shall be

required may be increased or decreased

when experience or changed conditions

so warrant.

§ 726.106 Type of security.

(a) The Office shall determine the

type or types of security which an

applicant shall or may procure. (See

§ 726.104(b).)

(b) In the event the indemnity bond

option is selected, the 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

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 based on a deposit of

negotiable securities, 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.

§ 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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80101

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.

§ 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 selfinsurer 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.

§ 726.109 Increase or reduction in the

amount of security.

Whenever in the opinion of the Office

the amount of security given by the selfinsurer 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. The Office may

reduce the amount of security at any

time on its own initiative, or upon the

application of a self-insurer, when it

believes the facts warrant a reduction. A

self-insurer seeking a 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 benefit payments he has made.

§ 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 such

authorization, 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 Act, all benefits payable on account

of total disability or death of any of its

employee-miners;

(2) To furnish medical, surgical,

hospital, and other attendance,

treatment, and care as required by the

Act;

(3) To provide security in a form

approved by the Office (see § 726.104)

and in an amount established by the

Office (see § 726.105), as elected in the

application;

(4) To authorize the Office to sell any

negotiable securities so deposited or any

part thereof, and to pay from the

proceeds thereof such benefits, medical,

and other expenses and any accrued

penalties imposed by law as the Office

may find to be due and payable.

(b) When an applicant has provided

the requisite security, he shall send to

the Office in Washington, D.C. a

completed agreement and undertaking,

together with satisfactory proof that his

obligations and liabilities under the Act

have been secured.

§ 726.111 Notice of authorization to selfinsure.

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 him by

section 415 and part C of title IV of the

Act.

§ 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 selfinsurer pursuant to this section may, in

appropriate circumstances result in a

revocation of the authorization to selfinsure.

§ 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 selfinsurance 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

Department of Labor promulgated

thereunder. (See 29 CFR part 70.)

§ 726.114 Period of authorization as selfinsurer; reauthorization.

(a) No initial authorization to selfinsure 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

§§ 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 selfinsurer warrants such action. If the

Office determines that such selfinsurer’s experience indicates a need for

the deposit of additional security, no

reauthorization shall be issued for the

ensuing fiscal year until the Office

receives satisfactory proof that the

requisite amount of additional securities

has 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 fiscal

year.

(b) In each case for which there is an

approved change in the amount of

80102 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

security provided, a new agreement and

undertaking shall be executed.

(c) Each operator authorized to selfinsure 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

it has posted 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.

§ 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 selfinsurer, may be deemed good cause for

such suspension or revocation.

Subpart C—Insurance Contracts

§ 726.201 Insurance contracts—generally.

Each operator of a coal mine who has

not obtained authorization as a selfinsurer 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.

§ 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.

§ 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 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 subchapter) 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

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 subchapter) 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 endorsement

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

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80103

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 endorsement 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 endorsement 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 endorsement

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 endorsement 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 paragraph (c)(1) through (5) of this

section, the endorsement 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.

§ 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.

§ 726.205 Other forms of endorsement and

policies.

Forms of endorsement or policies

other than that described in § 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.

§ 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.

§ 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 part 725 of this subchapter

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 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

§ 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.

§ 726.209 Report; by whom sent.

The report of issuance, cancellation,

or renewal of a policy and endorsement

provided for in § 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.

§ 726.210 Agreement to be bound by

report.

Every carrier seeking to write

insurance under the provisions of the

80104 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 § 726.208

shall bind the carrier to full liability for

the obligations under the 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.

§ 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 § 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.

§ 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 section 422(a) of part C

of title IV of the Act).

§ 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 § 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.

Subpart D—Civil Money Penalties

§ 726.300 Purpose and scope.

Any operator which is required to

secure the payment of benefits under

section 423 of the Act and § 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.

§ 726.301 Definitions.

In addition to the definitions

provided in part 725 of this subchapter

and § 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, 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.

§ 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 § 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 § 725.101 of

this subchapter. 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 § 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 § 726.303,

during which the operator failed to

secure its obligations under section 423

of the Act and § 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:

Employees Penalty

(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 (c)(2)(i)

of this section 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 § 726.4;

(ii) Was notified of its obligation to

comply with section 423 of the Act and

§ 726.4; or

(iii) Was notified of its potential

liability for a claim filed under the

Black Lung Benefits Act pursuant to

§ 725.407 of this subchapter.

(4) Commencing with the 11th day

after the operator’s receipt of the

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80105

notification sent by the Director

pursuant to § 726.303, the daily base

penalty amounts set forth in paragraph

(c)(2)(i) 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

§ 726.4 that takes place after January 19,

2001 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 § 726.4 or a

reasonable belief that it had obtained

insurance coverage to comply with

section 423 of the Act and § 726.4. A

notice of contest filed in accordance

with § 726.307 shall not be sufficient to

establish a reasonable belief that the

operator was not required to comply

with the Act and regulations.

§ 726.303 Notification; investigation.

(a) If the Director determines that an

operator has violated the provisions of

section 423 of the Act and § 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 § 725.351(a) of this subchapter. For

purposes of § 725.351(c), the Division

Director shall be considered to sit in the

District of Columbia.

§ 726.304 Notice of initial assessment.

(a) After an operator receives

notification under § 726.303 and fails to

secure its obligations for the period

defined in § 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 § 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 § 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.

§ 726.305 Contents of notice.

The notice required by § 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.

§ 726.306 Finality of administrative

assessment.

Except as provided in § 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 § 726.320.

§ 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

§ 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 § 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 § 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 § 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.

§ 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

80106 Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations

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 § 726.309, 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–2117,

Office of the Solicitor, U.S. Department

of Labor, 200 Constitution Ave., NW.,

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,

see § 725.311 of Part 725 of this

subchapter, in which case the time

period shall include the next business

day.

§ 726.309 Referral to the Office of

Administrative Law Judges.

(a) Upon receipt of a timely notice of

contest filed in accordance with

§ 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

§ 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

§ 726.313, the dismissal shall be without

prejudice to further assessment against

the operator for the period in question.

§ 726.310 Appointment of Administrative

Law Judge and notification of hearing date.

Upon receipt from the Director of a

complaint filed pursuant to § 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.

§ 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.

§ 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 § 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 selfinsure 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

§ 726.307(b)(3).

(c) The Director shall bear the burden

of proving the size of the operator as

required by § 726.302, except that if the

Director has requested the operator to

supply information with respect to its

size under § 726.303 and the operator

has not fully complied with that

request, it shall be presumed that the

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 § 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 § 726.302(d).

§ 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 § 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 § 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,

Federal Register / Vol. 65, No. 245 / Wednesday, December 20, 2000 / Rules and Regulations 80107

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) of this section or a petition

for review filed pursuant to § 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 shall suspend the

running of the time for any party to file

a petition for review pursuant to

§ 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.

§ 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.

§ 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.

§ 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.

§ 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.

§ 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.

§ 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.

§ 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, 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 422

and 426 of the Black Lung Benefits Act,

30 U.S.C. 932, 936, part 727 is removed.

[FR Doc. 00–31166 Filed 12–19–00; 8:45 am]

BILLING CODE 4510–48–P