United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

M.M., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

Oakland, CA, Employer 

__________________________________________ 

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Docket No. 13-2029 

Issued: September 10, 2014 

Appearances: Case Submitted on the Record

Appellant, pro se 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

COLLEEN DUFFY KIKO, Judge 

ALEC J. KOROMILAS, Alternate Judge 

JAMES A. HAYNES, Alternate Judge 

JURISDICTION 

On September 3, 2013 appellant filed a timely appeal from a July 2, 2013 merit decision 

of the Office of Workers’ Compensation Programs (OWCP). Pursuant to the Federal 

Employees’ Compensation Act1

 (FECA) and 20 C.F.R. §§ 501.2(c) and 501.3, the Board has 

jurisdiction over the merits of this case. 

ISSUES 

The issues are: (1) whether OWCP properly found that an overpayment of $111,523.92 

was created; (2) whether it properly found that appellant was at fault in creating the 

overpayment; and (3) whether OWCP properly determined that the overpayment should be 

recovered by deducting $2,043.94 from continuing compensation. 

 1

 5 U.S.C. § 8101 et seq. 
2

FACTUAL HISTORY 

On April 19, 1989 appellant, then a 36-year-old mail processor, filed a traumatic injury 

claim (Form CA-1) alleging that on that date he sustained a low back injury while pulling a 

container. OWCP accepted the claim for sprain of the back and shoulders on June 23, 1989. 

Appellant stopped working and began receiving compensation for wage loss. In a 

March 23, 1998 decision, OWCP indicated that it had also accepted aggravation of 

spondylolisthesis, L5-S1 disc protrusion and substance induced mood disorder with depression. 

The record contains a travel voucher request for dates from January 2 to 9, 2006 for “PT” 

and mileage of 150 miles roundtrip. The record also contains a January 7, 2008 Form OWCP957 (medical travel refund request) for “PT” at a medical facility “Central Office” with an 

Oakland, CA address. In addition, there is a June 12, 2012 OWCP-957 claiming travel 

reimbursement to “Eastbay Intergroup” at the same Oakland address. 

In a report dated February 3, 2006, Dr. Roger Shortz, a Board-certified neurosurgeon, 

indicated that appellant continued to be treated for lumbar spondylosis and spondylolisthesis at 

L5-S1. As part of the development of the medical evidence, OWCP found a conflict in the 

medical evidence with respect to the need for surgery. Appellant was referred by OWCP to 

Dr. Archimedes Ramirez, a Board-certified neurosurgeon. In a report dated November 28, 2006, 

Dr. Ramirez noted that appellant reported concern regarding his back, depression and 

dependency or addition to medication. He indicated that appellant needed to have a pain 

specialist manage his “chronic pain problem and dependency/addiction to Vicodin ES and 

Soma.” 

Appellant was again referred to a referee physician with respect to a conflict in the 

medical evidence. In a report dated May 1, 2008, Dr. Robert Fink, a Board-certified 

neurosurgeon, provided a history and results on examination. He stated that there was a 

complicating factor with respect to surgery, as there was “the strong possibility that [appellant] is 

medically addicted to opiates” and such addition rendered evaluation of pain levels unreliable. 

In a report dated March 24, 2009, Dr. Shortz noted that appellant currently used opiate 

medicine for pain relief. He stated that appellant did not abuse the medication or take it in 

excessive amounts and that he did not exhibit behavior typical of opiate addition. By report 

dated April 7, 2009, Dr. Gary Martinovsky, a Board-certified pain management specialist, stated 

that he was switching appellant from short lasting opioids to long lasting opioids. He stated that 

he would discontinue appellant from Vicodin, Lortab and Soma. By report dated July 9, 2009, 

Dr. James House, a psychologist, diagnosed major depressive disorder. He stated that appellant 

“admitted no current nor past substance abuse problems or dependency and no evidence of such 

was found during the course of this evaluation.” 

In a letter dated June 25, 2012, OWCP advised appellant that it had received a medical 

travel refund request form (OWCP-957) for travel expenses to East Bay Intergroup in 

Oakland, CA. It stated that the evidence was insufficient to establish reimbursement, as it was 

not clear what services were performed related to an employment-related condition. 
3

On August 2, 2012 OWCP received evidence from the employing establishment’s Office 

of Inspector General (OIG). According to a memorandum dated June 30, 2012, the East Bay 

Intergroup identified by appellant was a division of Alcoholics Anonymous (AA). In an 

affidavit dated July 16, 2012, an OIG special agent stated that from 2007 he had requested travel 

reimbursement for travel to an AA office, although he had written PT on the form. The special 

agent stated that the Department of Labor advised that travel to AA is not medically-related 

travel covered by FECA. The agent stated that, for the dates of surveillance from June 8 

to 30, 2012, appellant was never observed going to East Bay Intergroup. 

On December 3, 2012 OWCP received additional evidence from the OIG. The evidence 

included a list a transportation reimbursements from January 2, 2006 to June 20, 2012 that were 

not accompanied by a claim for other medical service. The total transportation reimbursements 

for these dates was $111,523.92. 

By letter dated December 7, 2012, OWCP advised appellant of a preliminary 

determination that an overpayment of $114,611.82 existed. An accompanying memorandum 

stated that the overpayment consisted of $111,523.92 for transportation expenses paid on dates 

with no other medical services claimed and $3,087.90 for “questionable” transportation 

reimbursements related to receipt of medical supplies. OWCP found that appellant was at fault 

in creating the overpayment. 

On December 28, 2012 appellant requested a prerecoupment hearing on the issues 

presented. He submitted evidence with respect to monthly income and expenses. On an 

OWCP-20 overpayment questionnaire, appellant reported $8,300.00 in monthly income and 

$8,296.00 in monthly expenses. 

A telephonic hearing was held on April 18, 2013. Appellant stated that he had been told 

by a claims examiner he could attend AA support group meetings and write PT on the 

reimbursement forms. Following the hearing, he submitted a 2012 W-2 wage and tax statement 

indicating his spouse had annual wages of $49,789.44. On May 21, 2013 appellant submitted 

some expense receipts and on June 3, 2013 he indicated that he received $3,152.00 per month in 

Veterans Administration (VA) benefits. 

By decision dated July 2, 2013, an OWCP hearing representative found that an 

overpayment of $111,523.92 was created.2

 She found that appellant was at fault in creating the 

overpayment and the overpayment would be recovered by deducting $2,043.94 every 28 days 

from continuing compensation. The hearing representative found appellant had $9,232.72 in 

monthly household income and $5,115.03 in expenses. 

LEGAL PRECEDENT -- ISSUE 1 

5 U.S.C. § 8103(a) provides for the furnishing of services, appliances and supplies 

prescribed or recommended by a qualified physician which OWCP, under authority delegated by 

the Secretary, considers likely to cure, give relief, reduce the degree or the period of disability or 

 2

 OWCP’s hearing representative deducted the $3,087.90 in reimbursements related to medical supplies. 
4

aid in lessening the amount of monthly compensation.3 Under this section, reasonable 

transportation and expenses incident to the securing of such services may be authorized. In 

interpreting section 8103(a), the Board has recognized that OWCP has broad discretion in 

approving services provided under FECA to ensure that an employee recovers from his or her 

injury to the fullest extent possible in the shortest amount of time.4 

ANALYSIS -- ISSUE 1 

In the present case, OWCP found an overpayment of compensation occurred from 

January 2, 2006 to June 20, 2012. The evidence from the OIG investigation indicated that 

OWCP had made $1,350.00 transportation reimbursements during that period in the amount of 

$111,523.92. All of these reimbursements were made on dates that appellant did not seek 

treatment from a physician. Appellant had claimed reimbursement for “PT” or physical therapy 

transportation expenses. He acknowledged at the April 18, 2013 hearing that he had claimed PT 

on the forms but the expenses were not for authorized physical therapy, but for AA support 

group meetings. 

The Board finds the evidence establishes an overpayment of $111,523.92 was created 

from January 2, 2006 to June 20, 2012. The evidence indicates that during this period appellant 

made claims for travel reimbursement that were for expenses not authorized under 5 U.S.C. 

§ 8103(a). OWCP had not authorized services from an AA support group and the payments 

made for travel reimbursement represent an overpayment of compensation. The investigation 

documents establish that during the period January 2, 2006 to June 20, 2012 OWCP issued 

$111,523.92 in transportation expense reimbursements and this represents an overpayment of 

compensation. 

LEGAL PRECEDENT -- ISSUE 2 

Section 8129(b) of FECA5

 provides: “Adjustment or recovery by the United States may 

not be made when incorrect payment has been made to an individual who is without fault and 

when adjustment or recovery would defeat the purpose of FECA or would be against equity and 

good conscience.”6

 No waiver of an overpayment is possible if the claimant is at fault in 

creating the overpayment.7

 3

 5 U.S.C. § 8103(a). 

4 Dale E. Jones, 48 ECAB 648, 649 (1997). 

5

 5 U.S.C. §§ 8101-8193. 

6 Id. at § 8129(b). 

7 Gregg B. Manston, 45 ECAB 344 (1994). 
5

On the issue of fault, 20 C.F.R. § 10.433 provides in pertinent part: 

“A recipient who has done any of the following will be found to be at fault with 

respect to creating an overpayment: 

(1) Made an incorrect statement as to a material fact which he or she knew 

or should have known to be incorrect; or 

(2) Failed to provide information which he or she knew or should have 

known to be material; or 

(3) Accepted a payment which the recipient knew or should have known 

was incorrect. (This provision applies only to the overpaid individual).” 

ANALYSIS -- ISSUE 2 

In the present case, the evidence of record indicates, as noted above, that appellant had 

claimed on travel expense reimbursement forms that he was travelling for PT or physical 

therapy. Appellant, however, acknowledged that the address on the forms was not associated 

with physical therapy services, but an AA support group facility. The reference to physical 

therapy was an incorrect statement. In addition, the incorrect statement related to a material fact. 

Authorization for visits to an AA support group had not been provided in this case. Although 

appellant briefly refers to a claims examiner as providing verbal authorization, no supporting 

evidence was provided. Moreover, he knew that the assertion that he was travelling for physical 

therapy was incorrect. Appellant knew that the address he provided was for an AA support 

group meetings and not physical therapy services. 

The Board accordingly finds that appellant made an incorrect statement as to a material 

fact which he knew or should have known to be incorrect. Pursuant to 20 C.F.R. § 10.433, 

appellant is properly found to be at fault in creating the overpayment. Since he is at fault, no 

waiver of the overpayment is possible. 

LEGAL PRECEDENT -- ISSUE 3 

OWCP regulations provide: 

“When an overpayment has been made to an individual who is entitled to further 

payments, the individual shall refund to OWCP the amount of the overpayment as 

soon as the error is discovered or his or her attention is called to the same. If no 

refund is made, OWCP shall decrease later payments of compensation, taking into 

account the probable extent of future payments, the rate of compensation, the 

financial circumstances of the individual and any other relevant factors, so as to 

minimize any hardship.”8

 8

 20 C.F.R. § 10. 441. 
6

ANALYSIS -- ISSUE 3 

In the present case, an OWCP’s hearing representative took into account appellant’s 

financial circumstances in determining the overpayment should be recovered by deducting 

$2,043.94 every 28 days from continuing compensation. As to monthly income, the hearing 

representative noted the evidence of record regarding VA benefits, OWCP compensation and 

spousal income, finding appellant had household monthly income of $9,232.72. In addition, the 

hearing representative reviewed the claimed expenses, noting appellant had submitted only 

limited receipts or other documents.9

 She accepted the claimed expenses for mortgage and other 

expenses, such as food. It was noted that some credit card payments are not included if the 

expense is already included in the ordinary and necessary living expenses.10 According to the 

hearing representative, appellant’s monthly household expenses were $5,115.03. 

The Board accordingly finds that OWCP’s hearing representative took into account the 

relevant financial circumstances to minimize hardship. The monthly income exceeded expenses 

by $4,117.69 and the recovery was set at $2,043.94 from continuing compensation. The Board 

finds that OWCP properly followed its regulations in this case. 

On appeal, appellant briefly stated that he was mentally incompetent, unable to 

comprehend the proceedings and was taking medication. He did not provide any probative 

evidence of mental incompetence with respect to overpayment issues. Appellant attended the 

April 18, 2013 hearing before an OWCP hearing representative and his testimony indicated that 

he clearly understood the issues presented. For the reasons noted above, the Board finds that he 

was at fault in creating a $111,523.92 overpayment of compensation. 

CONCLUSION 

The Board finds that an overpayment of $111,523.92 was created, appellant was at fault 

in creating the overpayment and therefore not entitled to waiver and OWCP properly determined 

the overpayment could be recovered by deducting $2,043.94 from continuing compensation. 

 9

 It is appellant’s responsibility to submit the necessary relevant financial information with respect to recovery of 

the overpayment. 20 C.F.R. § 10.438. 

10 See Federal (FECA) Procedure Manual, Part 6 -- Debt Management, Initial Overpayment Actions, Chapter 

6.600.2(e) (June 2009), which notes that the hearing representative should avoid counting an ordinary and necessary 

expense twice if a credit card payment is for expenses previously documented. 
7

ORDER 

IT IS HEREBY ORDERED THAT the decision of the Office of Workers’ 

Compensation Programs dated July 2, 2013 is affirmed. 

Issued: September 10, 2014 

Washington, DC 

 

 Colleen Duffy Kiko, Judge 

 Employees’ Compensation Appeals Board 

 

 Alec J. Koromilas, Alternate Judge 

 Employees’ Compensation Appeals Board 

 

 James A. Haynes, Alternate Judge 

 Employees’ Compensation Appeals Board