Federal Employees' Compensation Act: DOD Access to DOL Data Is Generally Sufficient, but Monitoring Timelines Could Help Return-to-Work Efforts
Published: 2016-09-15T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: DOD employs more than 720,000 civilians—approximately 35 percent of the federal civilian workforce—in an array of critical positions worldwide. DOD civilians who are injured or ill as a result of a work-related incident are covered under the DOL-administered FECA program. DOL, along with employing agencies like DOD, works to return injured employees to work and provides compensation for work-related disabilities. In 2015, about 90 percent of DOD's injured workers returned to work within 2 years of injury.
Senate Report 114-49 included a provision that GAO review DOD's use of the FECA program. This report analyzes (1) characteristics of DOD's 2015 FECA claimants and how they compared to non-DOD claimants and (2) the extent to which DOD experiences any challenges managing its FECA responsibilities and facilitating return-to-work outcomes.
GAO analyzed 2015 DOL data to identify characteristics, such as the age and benefit type, of FECA claimants, including those who received benefits that year (beneficiaries). GAO also analyzed relevant law, policies, and guidance on DOL and DOD's management of FECA, and interviewed DOL and DOD officials—including a nongeneralizable sample of DOD program officials.
section_title: What GAO Found
paragraphs: The Department of Defense's (DOD) 47,340 civilian employees who filed claims under the Federal Employees' Compensation Act (FECA) made up 17 percent of FECA claimants in 2015, and DOD total-disability beneficiaries (i.e., with no capacity to work) were generally older than those from the rest of government. About 35 percent of DOD beneficiaries received medical benefits only, and 31 percent received cash payments for injury or death—including the nearly 20 percent receiving partial- or total-disability benefits. About 56 percent of DOD total-disability beneficiaries were at or above their full Social Security Retirement age, compared to 32 percent of non-DOD beneficiaries (see figure).
DOD FECA officials that GAO interviewed generally had sufficient access to Department of Labor (DOL) data to manage their FECA responsibilities; however, they reported perceived delays with receiving certain decisions from DOL. As the administrator of FECA, DOL has responsibility and authority for managing all claims, but employing agencies have roles in returning employees to work. DOD FECA program managers, injury compensation specialists, and liaisons GAO interviewed reported experiencing some challenges in instances requiring DOL action or approval, such as determining whether a potential job is suitable in order to return an injured employee to work. According to DOD officials, in some instances such determinations have taken over a year, which could affect DOD as it must both hold the job unfilled and continue to pay compensation until a decision is made. According to DOL, this process can take several months due to the amount of information and communication required among the employing agency, the injured employee, DOL, and other parties, such as an employee's physician. Additionally, DOD has not monitored the timelines associated with requesting DOL action to determine the extent to which delays or related issues may exist across DOD, any known reasons for these issues, and any effect possible delays may have on DOD's return-to-work efforts. DOD officials said that such monitoring could help them understand any issues. DOL officials stated that if DOD experiences challenges, more information could help DOL find a solution. Without monitoring timelines, DOD is not positioned to identify the nature and extent of any problems, make any improvements, or communicate such issues to DOL.
section_title: What GAO Recommends
paragraphs: GAO recommends that DOD monitor timelines associated with significant FECA claims-management actions to identify the extent to which delays may occur and any known reasons, and communicate with DOL as appropriate. DOD agreed with the recommendation.

section_title: Letter
paragraphs: The Department of Defense (DOD) employs more than 720,000  civilians—approximately 35 percent of the federal civilian workforce—in  an array of critical positions worldwide. These civilian employees play  important roles in the defense of the nation, support critical department  functions, and some work alongside uniformed service members in  potentially challenging or hazardous occupations, where there is the  chance for injury or illness. In instances where federal employees— including DOD civilians—become injured or ill as a result of a work- related incident, they are covered under the Federal Employees’  Compensation Act (FECA) program. The FECA program provides cash  payments, medical care, and other benefits to employees who sustain  disabilities resulting from work-related injuries or diseases, and also aims  to return injured employees to work whenever possible. The FECA  program is administered by the Department of Labor’s (DOL) Office of  Workers’ Compensation Programs. As of June 30, 2015, approximately  277,775 federal employees had submitted claims for FECA benefits over  the preceding 12 months, and benefits paid during that period amounted  to approximately $3.1 billion.
Employing departments and agencies, including DOD, play a critical role  in assisting DOL’s management of claims and are the program’s first  point of contact with the injured worker—notifying employees of their  rights under FECA and submitting the initial claim. Program regulations  allow employing agencies to controvert or otherwise contest facts  presented in an injured worker’s claim for FECA benefits. Once a claim  has been accepted by DOL, employing agencies continue to play a role in  the program, for example by monitoring the claim and assisting  employees with their return to work once DOL determines that an injured  employee can return to work.
In March 2012, we identified four areas of FECA management challenges  reported in past reviews conducted by DOL and employing agencies’  inspectors general. These challenges involve (1) oversight, (2)  information technology, (3) legislative reform, and (4) other factors. For  example, we found that federal agencies’ inspectors general—citing  ongoing program weaknesses mostly related to oversight—reported  avoidable costs at agencies, which one department reported were as high  as $41 million in 2011. We further reported that, in an effort to alleviate  the effect of management challenges, the inspectors general collectively  made over 200 recommendations between 1994 and 2012, mainly to  improve FECA oversight, and most of these recommendations have been  implemented.
Senate Report 114-49, accompanying S. 1376, the National Defense  Authorization Act for Fiscal Year 2016, included a provision for us to  review DOD’s use of the FECA program. Specifically, this report  evaluates (1) characteristics of DOD’s 2015 FECA claimants and how  they compare to those outside of DOD; and (2) the extent to which DOD  experiences challenges managing its FECA responsibilities and  facilitating return-to-work outcomes for injured employees.
For the first objective, we obtained and analyzed 2015 data from DOL’s  integrated Federal Employee Compensation System to identify  characteristics of FECA claimants, including those receiving benefits  (beneficiaries). We used these data to analyze the characteristics of  claimants and beneficiaries from across DOD, including the military  departments and all other defense agencies, and we compared them with  non-DOD, government-wide populations. These data covered the period  from July 1, 2014, through June 30, 2015. We chose these data because  they were the most recent complete data available. We analyzed these  data for the following characteristics of claimants and beneficiaries: (1)  total- and partial-disability status, (2) age, (3) age at time of injury, (4)  number of years since injury, (5) type of benefit, and (6) benefit amount.  We also analyzed the data for FECA beneficiaries over their full Social  Security retirement age, based on their date of birth. We further analyzed  the data regarding the specific population of total-disability beneficiaries  since they represented a large proportion of DOD’s total FECA cash  payments. We assessed the reliability of the data elements we used by  (1) electronically testing required data elements, (2) reviewing information  about the data and the system that produced them, and (3) interviewing  agency officials knowledgeable about the data. We determined that the  data elements we used were sufficiently reliable for the purposes of our  reporting objectives.
For the second objective, we obtained and analyzed relevant federal law,  regulations, policies, procedures, and guidance for information on the  FECA program and to identify the roles and responsibilities of DOL, DOD,  and the Departments of the Army, Navy, and Air Force. We also  analyzed these documents for information on the types of tools— including data and information, performance metrics, and documented  time frames—that are available to DOD and military department FECA  program managers who oversee the DOD FECA claims process and  return-to-work efforts for DOD civilians. We also reviewed Standards for  Internal Control in the Federal Government to identify performance  measurement, monitoring, and communication mechanisms for effective  internal control. We interviewed knowledgeable officials within DOL’s  Office of Workers’ Compensation Programs, the Defense Civilian  Personnel Advisory Service within the Office of the Under Secretary of  Defense for Personnel and Readiness, and the military departments  about, among other things, (1) their roles in overseeing the FECA  program—including reporting claims to DOL and managing efforts to  return employees to work; (2) the sufficiency of access to data and  information, and any related challenges; and (3) any challenges  associated with managing DOD FECA claims and return-to-work efforts.  In total, we interviewed three injury compensation specialists from each of  the military departments (nine in total), three DOD Defense Civilian  Personnel Advisory Service injury compensation liaisons, and officials  from four FECA program offices—each of the military department  program offices and the Defense Civilian Personnel Advisory Service,  which has overall DOD responsibility for DOD human-resource areas,  including workers’ compensation. We interviewed these officials about  their role in the day-to-day operations and management of the DOD  FECA program, and what challenges, if any, they face returning  employees to work. While the total number of injury compensation  specialists interviewed does not constitute a generalizable sample of the  approximate 800 total DOD injury compensation specialists, the four  program offices and the liaisons we interviewed provide visibility of high- level issues for all the military departments and the majority of DOD  employees, and taken together the officials we interviewed provide  insights into DOD’s FECA operations and reflect their specific concerns.
We conducted this performance audit from October 2015 to September  2016 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
subsections: section_title: Federal Employees’ Compensation Act Program
paragraphs: The Federal Employees’ Compensation Act (FECA) and its implementing  regulations provide compensation for federal civilian employees who  suffer disabilities resulting from work-related injuries or diseases. DOL’s  Office of Workers’ Compensation Programs administers the FECA  program through its 12 district offices located throughout the United  States, and DOL claims examiners are responsible for directly managing  cases. While DOL has sole authority to adjudicate all claims for  compensation and make other determinations, the employing agency of  the beneficiary has a role in the process. In particular, DOL provides  FECA compensation—including cash and medical benefits—up front and  then charges agencies a “chargeback” for the compensation provided to  their employees. Employing agencies subsequently reimburse DOL each  “chargeback year” from their next annual appropriation. Table 1  provides an overview of the types of FECA benefits.
DOL determines the level and type of FECA benefits based on various  factors. For instance, disability benefits are paid to compensate for lost  wages if DOL finds that an employment-related injury, disease, or illness  impedes an employee’s ability to work. If an employee is unable to  perform any gainful employment, then he or she is considered totally  disabled, and DOL calculates compensation as a proportion of the  beneficiary’s entire income at the time of injury. If an employee is unable  to return to his or her previous job but is determined by DOL to be able to  work in some capacity, then he or she is considered to be partially  disabled, and compensation is based on any loss of wage-earning  capacity as compared to the preinjury wages.
Total-disability FECA beneficiaries with eligible dependents receive 75  percent of their preinjury wages, and those without dependents receive  66-2/3 percent. Partial-disability FECA beneficiaries with eligible  dependents receive a FECA benefit that is 75 percent of the difference  between their preinjury and postinjury wage-earning capacity, and those  without dependents receive 66-2/3 percent of the difference.  Additionally, benefits are adjusted annually for cost-of-living increases  and are neither subject to age restriction nor taxed. See figure 1 for an  example of how disability benefit payments are calculated.
There are certain restrictions or offsets for FECA beneficiaries if they are  eligible for or receive other federal benefits, such as from federal  retirement plans or other disability benefits. For instance, while  beneficiaries who receive medical benefits or schedule awards can  receive federal retirement benefits concurrently, such as benefits under  the Federal Employees Retirement System (FERS), beneficiaries  receiving wage-loss compensation (i.e., disability benefits) must elect to  receive one or the other. However, FECA does not require beneficiaries  to retire at a certain age and transition to their designated federal  retirement program. FECA beneficiaries can continue receiving FECA  compensation payments for as long as they remain unable to work due to  a workplace injury. Beneficiaries who are eligible for both FECA and  disability benefits from the Department of Veterans Affairs or the Social  Security Administration face restrictions on concurrent benefits for the  same injury. For instance, FECA beneficiaries receiving FECA and  Social Security disability payments for the same injury will have their  Social Security disability payments reduced by the amount of the FECA  compensation.
section_title: DOD and the Military Department Roles in the FECA Program
paragraphs: Although DOL administers the FECA program, directly manages claims,  and has sole approving authority, each military department and defense  agency within DOD has a role in processing its respective FECA claims.  Employing agencies like DOD and the military departments have a  financial responsibility and other roles in managing claims and the  employees’ cases, such as in submitting new injury claims and  subsequent wage-loss claims, providing continuation of pay, and  identifying job opportunities for employees to return to work where  possible.
At DOD, the Defense Civilian Personnel Advisory Service is the central  DOD entity responsible for civilian human resource management,  including workers’ compensation through the Injury and Unemployment  Compensation Branch. It provides policies, guidelines, and assistance to  each military department and the other DOD agencies, which directly  process employee FECA claims in coordination with DOL. The Defense  Civilian Personnel Advisory Service also employs DOD injury  compensation liaisons across the United States that directly support the  military departments and other DOD component agencies when  processing claims and coordinating with DOL.
The military departments each oversee their FECA claimants. The  Department of the Air Force, for example, has a workers’ compensation  and claims-management program located at the Air Force Personnel  Center that manages all FECA claims across the department. The  Department of the Navy—which includes the Marine Corps—oversees its  FECA claims with compensation specialists spread across the Navy  major commands and with major command program managers reporting  to the Navy FECA program manager. Within the Department of the Army,  each installation’s Civilian Personnel Advisory Center has an injury  compensation specialist who reports to the Civilian Human Resources  Agency.
In addition to the FECA statute, as well as DOL regulations and  procedures, DOD and the military departments follow Department of  Defense Instruction 1400.25, volume 810, which establishes policies and  procedures, provides guidance, delegates authority, and assigns  responsibilities regarding civilian personnel management of injury  compensation in DOD. The military departments and other DOD FECA  programs may use these documents to guide their FECA programs and,  like the Air Force, not publish additional formal policy documents, or they  may issue their own instructions or policies to further inform their FECA  programs. For example, the Army has documented implementing  guidance for its FECA program, and the Navy has a Secretary of the  Navy Instruction specific to the FECA program.
section_title: Information Systems to Process Claims
paragraphs: FECA claims are processed by DOL and employing agencies like DOD  using automated systems, including the Employees’ Compensation  Operations and Management Portal (ECOMP), as well as some agency-  and billing-specific systems. To provide information to DOL, such as  medical files or other supporting documentation, claimants and employing  agencies like DOD use ECOMP to conduct a variety of tasks related to  claims management and to electronically upload documents, which DOL  then reviews to make claims determinations and other decisions.
The Defense Civilian Personnel Advisory Service and military  departments also use the Defense Injury and Unemployment  Compensation System—a DOD-wide data application used as the  internal source for department-related FECA information. This system  gives DOD injury compensation specialists—the DOD counterparts that  coordinate with DOL claims examiners—the ability to perform case  management and data analysis functions by pulling a variety of DOL and  DOD data. The system includes key personnel information and claims  data for employees, including DOD payroll data and compensation costs,  and regularly updated DOL data.
section_title: Returning Employees to Work under FECA
paragraphs: FECA, as with workers’ compensation programs in general, attempts to  balance the goals of providing adequate wage-loss benefits for  employees injured on the job and also promoting return to work to  minimize the need for continued benefits. DOL testified before the House  Subcommittee on Workforce Protections in 2015 that over the past 5  years fewer than 2 percent of new injury cases—not all of which involved  a significant period of disability—remained on the compensation rolls 2  years after the date of injury. Additionally, to further improve  government-wide return-to-work rates, in July 2010 the President  introduced the Protecting Our Workers and Ensuring Reemployment  (POWER) Initiative, which created a new set of performance metrics  toward the achievement of government-wide goals, including targets for  returning injured employees to work. In the 2015 testimony, DOL also  noted that, as of fiscal year 2014, 88 percent of FECA claimants that  suffered a significant period of disability had returned to work within the  first year of injury and 91 percent returned to work by the end of the  second year. To support this end, DOL provides vocational rehabilitation  and other employment assistance. For example, DOL may offer  vocational assessments and transferable skills analysis and training for  injured employees.
While there is no universal agreement on the optimal level of workers’  compensation benefits or incentives for injured workers to return to work,  one can consider benefits in relation to take-home pay or retirement  benefits for older beneficiaries since overly generous benefits could  provide a disincentive to return to work. One possible disincentive is the  greater rate of compensation for beneficiaries with at least one  dependent. DOL has reported that most FECA beneficiaries fall into this  category and receive 75 percent of their preinjury wages tax-free, which  can in certain instances result in compensation greater than the injured  worker’s usual take-home pay. As FECA benefits do not have an age  limit, a second potential disincentive to return to work may exist if FECA  benefits are more generous than the retirement benefits that an individual  would receive as a federal annuitant.
An incentive to return to work within the FECA program is the reduction of  benefits for partial-disability beneficiaries, as noted in our prior work.  Specifically, benefits for partial disability are reduced based on wage- earning capacity by taking into account the income a beneficiary could  earn—whether a beneficiary finds a job or not. As such, in order for an  injured worker to maximize total income, he or she has an incentive to  find work that meets his or her work capabilities.
In our 2012 work, we examined FECA benefit levels in relation to take- home pay and retirement benefits, as some policymakers raised  questions about the level of FECA benefits, especially compared to  retirement benefits. Using simulated scenarios based on 2010 FECA  benefit data, we compared FECA benefits to wages and retirement  benefits that would have been earned absent the injury. Our simulations  showed that for 2010 total-disability beneficiaries, a median of 80 percent  of take-home pay was replaced by FECA for non-U.S. Postal Service  employees and a median of 88 percent for Postal employees.  Additionally, the median percentage of take-home pay replaced by FECA  was 3 percentage points greater for beneficiaries with an eligible  dependent than for those without eligible dependents.
Our comparison between simulated FECA benefits and retirement  focused on the retirement benefits package under the current Federal  Employees Retirement System (FERS), which consists of a pension  based on years of service and salary, the 401(k)-like Thrift Savings Plan,  and Social Security benefits. We conducted two separate analyses: The  first represented retirement benefits in 2010 and the second represented  retirement benefits in the future, based on employees’ ability to contribute  to the Thrift Savings Plan over the course of a more typical federal career  of 30 years. According to our simulations focused on 2010, the median  FECA benefit package for total-disability retirement-age non-Postal  beneficiaries was 32 percent greater than the comparable median  retirement benefit package they would have received absent an injury.
For Postal employees, the median FECA benefit was 37 percent greater  than the retirement package. However, our future-looking simulation  found smaller differences. Specifically, in the 30-year-career scenario, we  found that the median FECA benefit for total-disability non-Postal  employees was on par or slightly below the simulated median FERS  retirement package, and for Postal employees ranged from about 13  percent greater than the median retirement benefit to about 4 percent  less, depending on how much the employee contributed to the retirement  program.
section_title: DOD Represented 17 Percent of All Claimants Government-Wide in 2015, and Total- Disability DOD Beneficiaries Were Older Than Non-DOD Beneficiaries
subsections: section_title: DOD Accounted for about 17 Percent of All FECA Claimants, and DOD Beneficiaries Received Various Types and Levels of Benefits
paragraphs: In 2015, DOD’s FECA claimants represented 17 percent of all FECA  claimants government-wide, and DOD beneficiaries received  approximately $553.7 million worth of benefits (see fig. 2). In  comparison, DOD’s more than 720,000 employees represented about 35  percent of the federal civilian workforce. Overall in 2015, the FECA  program paid more than $3.1 billion in benefits and managed 277,775  claims, including 47,340 from DOD. The U.S. Postal Service had the  largest number of claimants—approximately 132,000.
FECA claimants were spread across DOD, and the military  departments—which represent nearly 80 percent of DOD’s civilian  workforce—had the vast majority of claimants. Specifically, the Navy  and the Army each had about one-third of all of DOD’s FECA claimants in  2015 (see fig. 3), while the other, nonmilitary DOD entities—which include  the Office of the Secretary of Defense and other DOD organizations—had  the smallest total percentage of FECA claimants (11 percent).
DOD’s beneficiaries receive various types of benefits—such as disability  benefits for wage-loss compensation on the daily and periodic roll, direct  schedule award payments, or paid medical care, as shown in table 2. For  example, in 2015 approximately 35 percent of DOD beneficiaries received  medical benefits only, and about 20 percent received partial- or total- disability benefits.
About 31 percent of DOD claimants received cash benefits in 2015,  compared to 26 percent of non-DOD claimants (see fig. 4). Across both  groups, partial- and total-disability beneficiaries on the periodic roll made  up the largest proportion of those receiving cash benefits.
In 2015, cash benefits totaled about $400 million for DOD beneficiaries  and $1.6 billion for non-DOD beneficiaries. The majority of cash benefits  were paid to total- and partial-disability beneficiaries on the periodic roll,  as illustrated by figure 5. The total percentage of cash payments to these  beneficiaries was slightly higher for DOD (75 percent) than for non-DOD  agencies (69 percent).
Total-disability beneficiaries constitute about 14 percent of all DOD FECA  claimants in 2015, as represented in the DOL data (as illustrated earlier in  fig. 4). Of these beneficiaries, the Navy and the Army had the highest  percentages in DOD (see fig. 6); though, taken together these two military  departments also constituted about 60 percent of the total DOD civilian  workforce. The Navy had the highest percentage of beneficiaries on the  periodic roll, with 36 percent of DOD’s total-disability population and 48  percent of DOD’s partial-disability population.
Of DOD’s total-disability beneficiaries, the vast majority—approximately  85 percent—received less than $50,000 in cash benefits in 2015 (see fig.  7). In contrast, about 4 percent received a benefit of $70,000 or more.  The median cash benefit in 2015 for total-disability beneficiaries across  DOD was just under $36,000.
The distribution of cash benefits for DOD’s military departments generally  mirrored the benefits for DOD overall, with the majority of all beneficiaries  receiving less than $50,000 per year (see fig. 8). The median cash benefit  for total-disability beneficiaries in the military departments was  approximately $36,000, while the median cash benefit paid to  beneficiaries from the other DOD agencies was just under $30,000.
section_title: DOD Total-Disability Beneficiaries Were Generally Injured Longer Ago and Constituted an Older Population Than Non-DOD Beneficiaries
paragraphs: A higher proportion of DOD total-disability beneficiaries sustained injuries  longer ago than similar non-DOD beneficiaries in 2015. Specifically, as  indicated in figure 9, about 60 percent of DOD total-disability beneficiaries  sustained their injuries 21 or more years ago, as compared to about 30  percent of non-DOD beneficiaries.
While DOD total-disability beneficiaries, as of 2015 data, were injured  longer ago than non-DOD beneficiaries, the two populations had similar  distributions with respect to age at the time of injury, as shown in figure  10. The median age at time of injury for these populations was 44 for  DOD and 45 for non-DOD. As a result of being similar ages as non- DOD beneficiaries at the time of injury but injured longer ago, DOD total- disability beneficiaries in 2015 were substantially older than those from  the rest of government (see fig. 11). Specifically, about 60 percent of  DOD total-disability beneficiaries were over the age of 65 as compared to  about 35 percent of non-DOD beneficiaries. This difference may be  attributable to the combination of DOD beneficiaries being injured longer  ago but at similar ages to their non-DOD counterparts.
In addition, about 56 percent of DOD beneficiaries were at or above their  full Social Security retirement age, compared to 32 percent of non-DOD  beneficiaries. For more information on the age of DOD and non-DOD  beneficiaries, as well as a discussion of total-disability beneficiaries at full  Social Security retirement age, see appendix I.
section_title: DOD Officials We Interviewed Reported Claims Data Are Generally Available to Process FECA Claims, but Said They Experience Challenges Regarding Process Timelines
subsections: section_title: DOD Officials Report Generally Sufficient Access to FECA Claims Data and Information Necessary to Carry Out Responsibilities
paragraphs: Most of the DOD injury compensation specialists, liaisons, and program  offices we interviewed reported they had the necessary FECA-related  information to effectively conduct their work. Specifically, 10 of the 12  injury compensation specialists and liaisons we spoke with, as well as  three of the four program offices, reported that they generally have  sufficient access to FECA claims data and information necessary for  managing their respective FECA program, including facilitating return-to- work outcomes.
ECOMP is DOL’s web-based system for various claim-management tasks  and is the source for filing and transmitting FECA claim information and  documents. DOD began migrating to ECOMP from past systems in fiscal  year 2015 and continues to adjust and increase access across the  department, according to Defense Civilian Personnel Advisory Service  officials. At the time we interviewed officials, the Defense Civilian  Personnel Advisory Service and the military departments had general  access to DOL’s ECOMP system, and five injury compensation  specialists and liaisons we interviewed specifically highlighted that  ECOMP improves the ability to access relevant information and data. For  instance, ECOMP allows DOD personnel faster access to claims  information, the ability to track the completion of certain documents, to  electronically file more types of claims forms, and real-time access to  claims documents. DOD has access to other DOL data and information  through other systems, including DOD’s internal Defense Injury and  Unemployment Compensation System that also provides access to DOL  claims information. In addition to case-specific data and information,  through the POWER Initiative DOL began providing agency-level FECA  program performance metrics, which it continues to make available on its  website. Although the POWER Initiative officially ended in fiscal year  2014, as of June 2016 DOL continued to use these metrics to report  agencies’ performance. All of the military department FECA program  managers we interviewed noted that they continue to monitor their  POWER goals and use them as a performance metric.
Defense Civilian Personnel Advisory Service officials stated that the data  they receive from DOL and other sources is extensive, though they added  that there may be additional resources that could be useful for their work.  For example, one liaison stated that additional access to certain  information, such as data on non-FECA disability benefits managed by  the Social Security Administration and the Department of Veterans  Affairs, could allow them to more easily identify individuals potentially  receiving other disability benefits. Additionally, although the majority of  DOD officials we spoke with reported having generally sufficient access to  conduct their case-management responsibilities, DOL and DOD officials  stated that DOD is still in the process of rolling out ECOMP throughout  DOD. For instance, according to Defense Civilian Personnel Advisory  Service officials, not all components have had full access to a component  of ECOMP that gives increased visibility over claimant documentation  such as medical information. For instance, at the time we interviewed  officials, Army and Navy injury compensation specialists noted instances  when medical documentation provided directly to DOL was not yet  accessible to them. In these instances, injury compensation specialists  must request hard-copy information directly from DOL claims examiners,  such as having the DOD liaison physically retrieve hard-copy information.  According to Defense Civilian Personnel Advisory Service officials, as of  July 2016 the Army has full access to ECOMP so can determine whether  or not updated information has been submitted. Officials expect the Navy  to have full access to ECOMP by the end of fiscal year 2016.
section_title: DOD Does Not Internally Monitor Processing Timelines
paragraphs: The Defense Civilian Personnel Advisory Service and all three military  department FECA program offices we spoke with reported experiencing  challenges when requesting information, decisions, or other actions, such  as suitability determinations and second-opinion requests, from DOL  during the return-to-work process. However, because DOD does not  monitor process timelines associated with such difficulties, the  department cannot fully identify the nature, magnitude, or effects of  problems it may be experiencing, or whether these issues, if any, are  widespread. Moreover, without a full understanding of any issues that  may exist, DOD is unable to communicate the scope of any such  problems to DOL.
Employing agencies are responsible for returning employees to work, but  DOL is responsible for determining whether a job offer is suitable to return  an employee to work and to obtain a second opinion on an employee’s  medical condition or work capacity. Suitability determinations of job offers  are needed when a claimant does not accept a job offer or accepts a job  offer but does not return to work. According to the DOL FECA Procedure  Manual, this process can involve a variety of considerations and  information that is submitted by multiple parties including the employing  agency, the claimant, often the claimant’s physician, and other medical  referrals as necessary. Second opinions may be requested by DOL to  obtain an additional medical evaluation to clarify the claimant’s condition,  the extent of a disability, work capacity, or other issues. During our  review, 9 of the 12 injury compensation specialists and liaisons we spoke  with, as well as all four of the program offices, reported experiencing  some challenges pertaining to lengthy response times from DOL’s claims  examiners, such as when submitting requests to DOL for suitability  determinations and second opinions. For instance, according to Defense  Civilian Personnel Advisory Service officials, DOD has experienced what  they perceive as lengthy periods waiting for suitability determinations from  DOL, in some instances over a year. DOL officials told us that the  process can take several months due to the exchange of information  among each of the parties involved, including DOL, the employing agency  (such as DOD), and the claimant. Additionally, the claimant is entitled to  due process of between 20 and 45 days depending on the circumstances  of the claim, according to DOL officials.
Defense Civilian Personnel Advisory Service officials stated that they  understand it takes time to make decisions about claims, especially given  the claims examiners’ caseloads, and the amount of documentation they  must review, including the required information they must collect from  doctors and the claimant. However, waiting for such long periods,  according to DOD officials, creates a hardship on the employing agency,  as it must both keep the position open for the injured employee, as well  as continue to pay the claimant until a decision is made. Although officials  from the Defense Civilian Personnel Advisory Service and all three  military department FECA program offices we spoke to cited the lengthy  response times for suitability determinations as a difficulty they  experience, officials did not provide further data or information on these  instances, and Defense Civilian Personnel Advisory Service officials said  such cases are not monitored across the department. Additionally,  according to DOL officials, even after DOL has reached a decision there  is often continued back and forth between DOL and the claimant to  provide additional documentation, or between DOL and the employing  agency in order to provide additional or revised documentation. According  to DOD and DOL officials, they seek to resolve such delays or other  issues at the case-management level—between the DOD injury  compensation specialist and the DOL claims examiner—so the reasons  for the delay may not be elevated to higher levels, or monitored across  the department, if they are ultimately resolved.
In addition to concerns with response times for suitability determinations,  three of the four FECA program managers we spoke with, as well as five  injury compensation specialists, specifically cited the length of time it  takes DOL to approve or process second opinions as a key challenge  they perceive during the return-to-work process. For example, one  program manager stated that when a second opinion medical evaluation  is conducted, that evaluation is valid for 1 year, so if DOL does not review  and act on the information in a timely manner it may result in the need for  an additional medical evaluation. Further, according to that program  manager, second-opinion evaluations can cost between $2,000 and  $7,000, and this cost is borne by the employing agency, as well as the  cost of a subsequent second opinion if the first one expires. However, this  official did not provide specific examples or the frequency with which this  issue occurred, and Defense Civilian Personnel and Advisory Service  officials do not know the extent to which this may be a problem across the  department. All three DOD liaisons we spoke with, as well as DOL, said  that it is difficult to provide expectations for the amount of time it may take  DOL to take action, in part because of elements outside of DOL’s control,  such as the scheduling of appointments and submission of medical  documentation, and because every claim has its own set of facts and  circumstances.
DOL procedures require claims examiners to respond to employing  agencies within some established time frames, according to DOL officials,  but there is no established time frame within which they are required to  make suitability determinations, approve a second-opinion request, or  complete the review of related medical documentation. There are also  instances, according to DOL officials, when a DOL claims examiner may  not agree that a second opinion is appropriate. According to the DOL  FECA Procedure Manual, however, employing agencies should expect to  receive information from DOL relevant to the claim-management process,  including prompt determinations on medical issues and the suitability of  job offers when needed. DOL officials stated that they generally expect  to respond to agency requests from employing agencies within 30 days,  and if they are aware of any overdue requests or issues with claims  examiner performance they try to resolve them between the claims  examiner and the employing agency at the lowest possible level, and the  issue is only raised to the district office or higher if it is not resolved.  Officials added that it is challenging to establish expected standard time  frames for certain requests, such as suitability determinations, given the  variability of requests and the specific circumstances and details of each  case.
One of the ways DOD injury claims specialists seek information on  suitability determinations and second-opinion requests, among other  claims-related information, is through DOL’s central phone system. Many  of the DOD officials we spoke with cited the reliance on this phone  system for direct communication as a complicating factor in attempting to  discuss these and other information requests with DOL claims examiners.  Specifically, 7 of the 12 injury compensation specialists and liaisons  identified issues related to DOL’s consistency and timeliness in  responding to agency requests using DOL’s centralized phone system.  For example, FECA program managers from all three military  departments, as well as two injury compensation specialists, noted  instances in which DOL either did not respond in a timely manner or  never returned the phone call. The DOL FECA Procedure Manual  requires that DOL claims examiners respond to phone calls within 2 work  days, and DOL officials stated that leaving a voice-mail message is  sufficient to meet this deadline. According to DOL officials, agency  requests can be submitted to DOL claims examiners through ECOMP or  via postal mail, in addition to DOL’s central phone system. One DOD  injury compensation specialist stated that, due to the challenges  experienced in reaching a claims examiner by phone, it is more efficient  to use ECOMP—which allows adding additional notes to previous entries  into the system—to ensure the DOL claims examiner receives the  updates. However, this specialist added that ECOMP does not convey  whether or not the claims examiner has taken action on these follow-up  requests.
All of the DOD officials we spoke with—12 injury compensation  specialists and liaisons, as well as each of the military departments’  FECA program offices, and FECA management at the Defense Civilian  Personnel Advisory Service—highlighted difficulties with the  communication timelines between DOD and DOL. However, while the  military departments’ program offices cover the majority of the FECA  beneficiaries, we did not speak to a generalizable sample of the FECA  program staff at DOD, and the officials we spoke with could only present  their individual experiences. Further according to officials from the  Defense Civilian Personnel Advisory Service, DOD has not monitored  FECA program processes such as communication timelines and  response times between DOD and DOL, nor has it tracked any known  reasons or solutions to any related issues, on a department-wide basis  across its approximately 800 FECA injury compensation specialist staff.
DOL officials stated that if DOD is experiencing ongoing challenges, more  information about these challenges would be helpful to find a solution.  They added that DOL has an open-door policy, and a number of existing  mechanisms are intended to facilitate general communication between  the employing agencies and DOL. For example, DOL officials stated that  many issues are resolved at the claims examiner level, or after being  elevated to the district-office level, and while district offices can track  responsiveness and other issues in their district to identify any issues, this  is not done across agencies. However, DOL and Defense Civilian  Personnel Advisory Service officials noted that there is ongoing staff  turnover among the DOD injury compensation specialists and DOL claims  examiners. According to Defense Civilian Personnel Advisory Service  officials, such turnover can make monitoring the claims process more  difficult at the injury compensation specialist level, though they noted that  the role of the DOD liaisons can mitigate this by providing continuity  across the FECA program. According to DOD officials, the DOD liaisons  serve a key function in providing information to DOD injury claims  specialists as well as facilitating communication at the DOL district-office  level since they are colocated with DOL claims examiners at these offices  and are able to be in more immediate contact.
Standards for Internal Control in the Federal Government state that  ongoing monitoring should occur in the course of normal operations.  Monitoring should assess the quality of performance over time and  ensure that the findings are promptly resolved. DOD has monitored  high-level program metrics such as return-to-work rates and overall  timelines, but Defense Civilian Personnel Advisory Service officials stated  that particular claims-processing timelines—such as response times  between DOD and DOL—are not specifically collected or monitored.  According to Defense Civilian Personnel Advisory Service officials, DOD  has internal mechanisms through which such monitoring or information  gathering of the FECA process could occur, such as the function of  liaisons in DOL district offices and installation-level working groups, as  well as periodic program office–level meetings. Additionally, Defense  Civilian Personnel Advisory Service officials stated that the increased  access to ECOMP will provide further visibility of FECA claims and the  decisions and actions that DOD is waiting for from DOL.
Based on our interviews with FECA program officials at DOD, issues such  as difficulties contacting DOL claims examiners and lengthy response  times occur between DOD and DOL. However, the extent to which this is  a problem across the department is unknown. In our past work we have  found that leading practices for results-oriented organizations state that it  is important for organizations to have complete, accurate, and consistent  information to support decision-making. Further, leading practices for  effective interagency collaboration state that frequent communication is a  means to work across agency boundaries and prevent  misunderstanding. Defense Civilian Personnel Advisory Service officials  stated that monitoring information like response times could help them  further understand any issues or problems they may experience and help  inform future communication with DOL. DOL officials added that if there is  an issue within DOD that is not being elevated or reported up their own  chain of command, then DOL is likely unaware of the issue as well.  Without monitoring or collecting information on issues DOD may  experience, including any known reasons for or resolutions to delays,  department leadership will not be positioned to identify and assess the  nature of any problems, and make any appropriate internal improvements  or external improvements in collaboration with DOL.
section_title: Conclusions
paragraphs: In 2015, DOD employees constituted nearly one-fifth of all FECA  beneficiaries across the federal government—the highest number outside  the U.S. Postal Service. DOD paid $554 million in FECA medical and  compensation benefits in 2015. Given the substantial monetary outlay this  represents, DOD needs accurate information on the operation of the  FECA program, including the timeliness of its various processes.  Facilitating return-to-work outcomes can depend on timely job-suitability  determinations. While not generalizable, our discussions with the military  departments’ injury compensation specialists, DOD liaisons, and FECA  program managers indicate that the department may face challenges in  its efforts to work with DOL to effectively manage DOD’s FECA process.  However, without monitoring the timelines associated with injury  compensation specialists’ processing of FECA claims—particularly the  significant claims-management actions over which DOL has approving  authority—the department is not positioned to identify the extent to which  delays or inefficiencies are present, at what points in the process they  occur, or any reasons or resolutions for such issues. Such information  would help DOD in managing its FECA responsibilities, and allow the  department to communicate any appropriate concerns to DOL.
section_title: Recommendation for Executive Action
paragraphs: To help support DOD management of its FECA responsibilities, we  recommend that the Secretary of Defense direct the Office of the Under  Secretary of Defense for Personnel and Readiness, in collaboration with  the Secretaries of the military departments and other defense agency  leaders, to monitor timelines associated with significant FECA claims- management actions in order to identify the extent to which delays or  inefficiencies may be occurring and at what points in the process; to  identify any known reasons for the delays; and to communicate this  information to DOL as appropriate for consideration and action.
section_title: Agency Comments
paragraphs: We provided a draft of this product to DOD and DOL for comment. In its  written comments, reproduced in appendix II, DOD agreed with our  recommendation. DOL provided technical comments that were  incorporated, as appropriate.
We are sending copies of this report to the appropriate congressional  committees, the Secretary of Defense, the Secretary of Labor, and other  interested parties including the military departments and other defense  agencies. In addition, this report is available at no charge on the GAO  website at http://www.gao.gov.
If you or your staff has any questions regarding this report, please contact  Brenda Farrell at (202) 512-3604 or farrellb@gao.gov, or Andrew Sherrill  at (202) 512-7215 or sherrilla@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page   of this report. GAO staff who made major contributions to this report are  listed in appendix III.
section_title: Appendix I: Age of Total-Disability Beneficiaries and Full Social Security Retirement Age
paragraphs: In 2015, the Department of Defense (DOD) had a higher percentage of  beneficiaries over the age of 65 than the rest of the beneficiary  population, as illustrated in figure 11. DOD also had a higher proportion of  total-disability beneficiaries at or above full Social Security retirement age  (see fig.12). About 56 percent of DOD beneficiaries were at or above their  full Social Security retirement age, compared to 32 percent of non-DOD  beneficiaries.
Further, while DOD and non-DOD total-disability beneficiaries had similar  median ages at time of injury, a greater percentage of DOD total-disability  beneficiaries at or above their full Social Security retirement age were  injured at age 50 or younger. As illustrated in figure 13, 65 percent of  DOD beneficiaries at or above their full retirement age, and 56 percent of  non-DOD beneficiaries, were age 50 or younger when injured.
According to the data for 2015, DOD had a higher percentage of  retirement age beneficiaries who were injured longer ago compared to  beneficiaries in non-DOD agencies. However, these data are only  reflective of FECA beneficiaries in chargeback year 2015—the period  from July 1, 2014, through June 30, 2015—so no longer-term trends or  conclusions may be drawn from these data. Further, DOL’s data system  is not designed in a way that allows us to determine the cumulative  amount of time a person has received FECA benefits, so we are unable  to determine whether these beneficiaries have been on disability  continuously since the time of injury. Hence, these data do not account  for any possible breaks in benefits, such as if an employee returned to  work during this time.
section_title: Appendix II: Comments from the Department of Defense
section_title: Appendix III: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgments
paragraphs: In addition to the above contacts, Vincent Balloon, Assistant Director;  Nagla’a El-Hodiri, Assistant Director; David Ballard; James Bennett;  Melinda Cordero; Michael Kniss; Kirsten Lauber; Tamiya Lunsford;  Jonathon Oldmixon; James Rebbe; Sabrina Streagle; Anjali Tekchandani;  Patrick Tierney; Jennifer Weber; Erik Wilkins-McKee; and Sally  Williamson made key contributions to this report.
section_title: Related GAO Products
paragraphs: Disability Insurance: Actions Needed to Help Prevent Potential  Overpayments to Individuals Receiving Concurrent Federal Workers’  Compensation. GAO-15-531. Washington, D.C.: July 8, 2015.
Federal Employees’ Compensation Act: Analysis of Benefits Associated  with Proposed Program Changes. GAO-15-604T. Washington, D.C.: May  20, 2015.
Federal Employees’ Compensation Act: Effects of Proposed Changes on  Partial Disability Beneficiaries Depend on Employment After Injury.  GAO-13-143R. Washington, D.C.: December 7, 2012.
Federal Employees’ Compensation Act: Analysis of Proposed Changes  on USPS Beneficiaries. GAO-13-142R. Washington, D.C.: November 26,  2012.
Federal Employees’ Compensation Act: Analysis of Proposed Program  Changes. GAO-13-108. Washington, D.C.: November 26, 2012.
Federal Employees’ Compensation Act: Status of Previously Identified  Management Challenges.GAO-12-508R. Washington, D.C.: April 27,  2012.
Federal Employees’ Compensation Act: Benefits for Retirement-Age  Beneficiaries. GAO-12-309R. Washington, D.C.: February 6, 2012.
Federal Workers’ Compensation: Questions to Consider in Changing  Benefits for Older Beneficiaries. GAO-11-854T. Washington, D.C.: July  26, 2011.