Congress Considers Taking over Defense Base Act Coverage

Thursday, November 6, 2008 | 0

By Herb Chestnut

I read recently that Congress was considering a proposal that the federal government take control of the administration, funding and all other aspects of the Defense Base Act.  While I think that we all agree that AIG is not the most efficient and fair manager of the Act, just ask anyone who has ever had a claim under the Federal Employees’ Compensation Act (FECA) how they feel about the government getting in the game.

FECA applies generally to all federal employees working in the U.S. who do not come under the Non-Appropriated Fund (NAF) extension to the Longshore and Harbor Workers’ Compensation Act (LHWCA).  Therefore, if you work for at the Post Exchange, the commisary, the golf course or anywhere else that derives its funds from sources besides Congress, you come under the NAF and the LHWCA.  Most of these workers are employed by AAFES or the Navy Exchange Service.  Practically everyone else, postal workers, employees of the DOL, federal court employees, any employee of a federal agency, come under the FECA.  The easy test is, if you are a civil servant, you have the pleasure of having coverage under the FECA.

What is so bad about the FECA you ask?  First, the District Offices in a Longshore case serve as mediators and assist both sides in following the Act. Under the FECA, they become the advocate for the employer.  If you can ever find out who your claims examiner (CE) is, you can certainly never get him or her on the phone.  They are so swamped that all mail to any disctict office goes to a central mailing/scanning facility in London, Kentucky.  Theoretically, it is scanned into the system.  However, with the volume of mail, the chances of you having to send something three or four times is frighteningly high.  Once the CE finally gets your document, there is no guarentee that anyone will take any action on it.  The only way to get anything done is to get your Congressman involved.  I like to think that my Congressman has more important things on his or her plate than whether I get reimbursed for mileage.

My point is, if Congress basically “insures” these companies and administers the Defense Base Act, it will be worse than it is now plus the taxpayers will be forced to pay not only for benefits but for the massive expansion of the District Offices handling Longshore cases.  If you are skeptical or curious, next time you are on the phone with the District Office, ask them how many claims examiners they have.  Also, ask if they know how many claims examiners are on the FECA side (it is the same District Office) and ask for the phone number.  Call the FECA office and see how long it takes for someone to even answer the phone.

Secondly, this action would make it very difficult for the CEs to remain impartial when one of the parties would be the federal government.  Even if the CE is successful in remaining neutral, the appearance of bias is just as bad as bias itself.  Under the FECA, the CE acts as an advocate for the employer and you have to argue with the district office to obtain benefits.  If you do not like the decision of the district office, you have a limited right to a hearing.  However, the hearing is not conducted by a judge but a “hearing officer” who also works for the Department of Labor .  Most of these hearing officers used to be, you guessed it, claims examiners at the District Office.  If you do not like the hearing officer’s decision, you can appeal to an entity called the “Employees Compensation Appeals Board” (ECAB).  However, good luck getting a decision, much less a favorable one.  According to the Acting Inspector General, Department of Labor, the admitted backlog of the ECAB is 16 months.  The actual backlog may be worse.  Furthermore, a whopping 89% of the claimants who patiently wait two years for a decision, lose.

As unfair and incompetent the insurers can be in this area, their behavoir is offset by the fairness and competency of the claims examiners at the District Offices and the Administrative Law Judges at the OALJ.  I would rather take my chances any day in a true adversary system with the OWCP and the OALJ in the middle as mediators and judges.  If these claims are handled by the government, whether under the FECA or a basterdized version of the LHWCA, we will suffer - we, the claimants, we, the advocates and we, the taxpayers.

Write your Congressman and tell them “NO.”  Defense Base Act cases are good where they are.  Why should we create a new bureaucracy when the current system, while not perfect, works?

Herb Chestnut is principal of Herb Chestnut & Associates, a law firm in Marietta, Ga. that specializes in workers' compensation, longshore and Defense Base Act claims. This column was reprinted with his permission from the Defense Base Act blog, http://defensebaseactblog.com/