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OWCP Clarifies Schedule Award Procedures

Daniel M. Goodkin April 1, 2017

OWCP clarifies schedule award procedures, including how pre-existing or nonindustrial medical conditions affect these important permanent disability awards.

There have been persistent problems in Federal Employees' Compensation Act (FECA - workers' compensation for federal employees) cases in the amount of awards for permanent impairments.  Under the law, there is no "apportionment" - that is, if the employment contributed to any degree to the medical condition causing the disability, the entire disability is covered in full.

But OWCP claims examiners and their examining physicians have for years been calculating some awards based only on the work-related portion of the disability or impairment.  For example, a worker with pre-existing arthritis in his right knee who injures it at work, requires surgery for a torn meniscus, and now has more knee impairment due to both medical conditions would be incorrectly evaluated with regard to the surgical result only, ignoring the arthritis which is also affecting his knee and contributing to a higher level of impairment.

That has never been correct, and has resulted in large numbers of appeals that had to be filed just to point out that there is no apportionment in these cases and therefore the awards should be higher. After repeated complaints about this from our office and others, USDOL has finally clarified the issue.

In FECA Transmittal No. 17-02 issued on March 24, 2017, OWCP revised its Procedure Manual to clarify a number of things regarding permanent disability schedule awards:

  1. When OWCP's District Medical Advisor ("DMA" -a doctor) disagrees with its Second Opinion doctor on an issue, this disagreement doesn't create a conflict in medical evidence requiring yet another evaluation.

  2. When OWCP has already sent the injured worker to a referee (independent) medical examiner, there is no need for the government to have the DMA review the referee's opinion.  Referees see injured workers where the treating doctor and the government 's doctor disagree  This change only applies, however, when the referee's report fully resolves the earlier conflict in medical opinions and provides a through explanation of the medical impairment.

  3. There are no provisions for apportionment in FECA, so impairment ratings should include both work-related and non-work-related impairments to the affected body part.

The third item above is the most important one.  This should result in larger and more timely schedule awards for injured federal workers where, before, errors had been made in the award calculation that resulted in appeals and other challenges.  If the awards are going to be calculated correctly, we can avoid costly appeals and the correct (higher) amount of benefits can be paid in a timely manner.

Further, this change clarifies that the disability rating must include all conditions affecting the affected body part as of the time of the rating examination.  This means that, theoretically, a worker could suffer another injury after the industrial one but before the rating exam, and the effects of that extra injury would also have to be included in the rating. It also means that the effects of any other non-industrial injuries have to be included in the rating as well.

All this makes sense administratively in a non-adversarial system. Litigation in other workers' compensation systems is often complicated by the need to apportion disabilities, ascribing a percentage to different causes -- but those are adversarial systems where both sides have attorneys and a judge makes the decision. FECA is not designed as an adversarial system that could handle such disputes. It also of course makes sense legally, since the rule against apportionment means there is no need to attribute percentages to the various causes. Practically speaking, it is difficult anyway for a doctor to determine how much the knee (in the above example) was affected by more than one cause.

The other two items above are unobjectionable and should result in faster adjudication of such claims.  Considering how slow OWCP is to finalize so many actions on FECA claims, this could speed up some claims.

There are other types of awards for permanent injuries in FECA claims, including lost wage benefits for both total and partial disability, but those are not affected by this change in the Procedure Manual.

NOTE: So far, the new Congress has not made any legislative proposals affecting FECA. We will continue to monitor this situation and report on any developments.