In implementing EEOICPA, the President acknowledged that it  had been Energy’s past policy to encourage and assist its contractors in  opposing workers’ claims for state workers’ compensation benefits based  on illnesses said to be caused by exposure to toxic substances at Energy  facilities. Energy then develops the claims by requesting records of employment,  medical treatment, and exposure to toxic substances from the Energy  facilities at which the workers were employed. If Energy determines that  the worker was not employed by one of its facilities or did not have an  illness that could be caused by exposure to toxic substances, the agency  finds the claimant ineligible. Energy Has Fully Processed Few Cases, and Systems Limitations Complicate Program Management

As of June 30, 2003, Energy had completely processed about 6 percent of  the nearly 19,000 cases that had been filed, and the majority of all cases  filed were associated with facilities in nine states. At the time of our study, Energy had not yet begun  processing more than half of the cases, and an additional 40 percent of  cases were in processing (see fig. 2). The contractors considered to be willing payers are those that  have an order from, or agreement with, Energy to not contest claims. A Majority of Cases in Nine States Potentially Have a Willing Payer

A majority of cases in nine states will potentially have a willing payer of  workers’ compensation benefits, assuming that for all cases there has been  a positive physician panel determination and the claimant can  demonstrate a loss from the worker’s illness that has not previously been  compensated. Specifically, based on our analysis of worker’s  compensation programs and the different types of workers compensation  coverage used by the major contractors, it appears that approximately 86  percent of these cases will potentially have a willing payer—that is,  contractors and their insurers who will not contest the claims for benefits. However, since no  claimants to date have received compensation as a result of their cases  filed with Energy, there is no actual experience about how contractors and  state workers’ compensation programs treat such cases. Concerns about the extent to which there will be willing payers of benefits  have led to various proposals for addressing this issue. Bottlenecks In Energy’s Claims Process Delay Filing Of Workers Compensation Claims

As a result of Energy’s policies and procedures for processing claims,  claimants have experienced lengthy delays in receiving the determinations  they need to file workers’ compensation claims. In particular, the number  of cases developed during initial case processing has not always been  sufficient to allow the physician panels to operate at full capacity. Moreover, even if these panels were operating at full capacity, the small  pool of physicians qualified to serve on the panels would limit the agency’s  ability to produce more timely determinations. When Energy first began developing cases, in the fall of  2002, the case development process had a staff of about 14 case managers  and assistants. Currently,  approximately 100 physicians are assigned to panels of 3 physicians. Energy officials are exploring ways that the panel process could be made  more efficient.
Why GAO Did This Study

The Department of Energy (Energy) and its predecessor agencies and contractors have employed thousands of workers in the nuclear weapons production complex. Some employees were exposed to toxic substances, including radioactive and hazardous materials, during this work and many subsequently developed illnesses. Subtitle D of the Energy Employees Occupational Illness Compensation Program Act of 2000 allows Energy to help its contractor employees file state workers' compensation claims for illnesses determined by a panel of physicians to be caused by exposure to toxic substances in the course of employment at an Energy facility. Energy began accepting applications under this program in July 2001, but did not begin processing them until its final regulations became effective on September 13, 2002. The Congress mandated that GAO study the effectiveness of the benefit program under Subtitle D of this Act. This testimony is based on GAO's ongoing work on this issue and focuses on three key areas: (1) the number, status, and characteristics of claims filed with Energy; (2) the extent to which there will be a "willing payer" of workers' compensation benefits, that is, an insurer who--by order from, or agreement with Energy--will not contest these claims; and (3) the extent to which Energy policies and procedures help employees file timely claims for these state benefits.

What GAO Found

As of June 30, 2003, Energy had completely processed only about 6 percent of the nearly 19,000 cases it had received. More than three-quarters of all cases were associated with facilities in nine states. Processing had not begun on over half of the cases and, of the remaining 40 percent of cases that were in processing, almost all were in the initial case development stage. While the majority of cases (86 percent) associated with major Energy facilities in nine states potentially have a willing payer of workers' compensation benefits, actual compensation is not certain. This figure is based primarily on the method of workers' compensation coverage used by Energy contractor employers and is not an estimate of the number of cases that will ultimately be paid. Since no claimants to date have received compensation as a result of their cases filed with Energy, there is no actual experience about how contractors and state programs treat such claims. Claimants have been delayed in filing for state worker's compensation benefits because of two bottlenecks in Energy's claims process. First, the case development process has not always produced sufficient cases to allow the panels of physicians who determine whether the worker's illness was caused by exposure to toxic substances to operate at full capacity. While additional resources may allow Energy to move sufficient cases through its case development process, the physician panel process will continue to be a second, more important, bottleneck. The number of panels, constrained by the scarcity of physicians qualified to serve on panels, will limit Energy's capacity to decide cases more quickly, using its current procedures. Energy officials are exploring ways that the panel process could be more efficient.