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 Processed Few Cases, and Insufficient Strategic Planning and Data Collection Complicate Program Management

As of December 31, 2003, Energy had completely processed about   6 percent of the more than 23,000 cases that had been filed, and the  majority of all cases filed were associated with facilities in 9 states. Energy  had begun processing on nearly 35 percent of cases, but processing had  not begun on nearly 60 percent of the cases. Further, these limitations make it difficult to assess the  achievement of goals related to program objectives, such as the quality of  the assistance given to claimants in filing for state workers’ compensation. A Shortage of Qualified Physicians to Issue Determinations Delays Filing of Workers’ Compensation Claims, and Claimants May Receive Inadequate Information to Prepare Them to Pursue These Claims

Energy was slow in implementing its initial case processing operation, but  it is now processing enough cases so that there is a backlog of cases  awaiting physician panel review. Claimants have experienced lengthy delays in receiving the determinations  they need to file workers’ compensation claims and have received little  information about claims status as well as what they can expect from this  process. Energy has taken some steps intended to reduce the backlog of  cases. With  modest staffing increases, the program quickly outgrew the office space  used for this function. While Workers’ Compensation Claims for a Majority of Cases Are Not Likely to Be Contested, Actual Compensation Is Not Certain

Our analysis shows that a majority of cases associated with Energy  facilities in 9 states that account for more than three-quarters of all  Subtitle D cases filed are not likely to be contested. However, the  remaining 20 percent of cases lack willing payers and are likely to be  contested. These percentages provide an order of magnitude estimate of  the extent to which claimants will have willing payers and are not a  prediction of actual benefit outcomes for claimants. In these cases, self-insured contractors will not contest the claims  for benefits as ordered by Energy. Another 25 percent of the cases, while  not technically having a willing payer, have workers’ compensation  coverage provided by an insurer that has stated that it will not contest  these claims and is currently processing several workers’ compensation  claims without contesting them. Because of data limitations,  these percentages provide an order of magnitude estimate of the extent to  which claimants will have willing payers. These estimates could change as better data become available or as  circumstances change, such as new contractors taking over at individual  facilities. Several Issues Could Be Considered in Evaluating Options for Improving the Likelihood of Willing Payers

Various options are available to improve payment outcomes for the cases  that receive a positive determination from Energy, but lack willing payers  under the current program. In particular, the cost implications of these options for the  federal government should be carefully considered in the context of the  current and projected federal fiscal environment. Table 2 arrays the relevant issues to provide a framework for  evaluating the range of options in a logical sequence. Recommendations for Executive Action

To improve Energy’s effectiveness in assisting Subtitle D claimants in  obtaining compensation for occupational illnesses, we recommend that  the Secretary of Energy:  in order to reduce the backlog of cases waiting for review by a physician  panel, take additional steps to expedite the processing of claims though its  physician panels and focus its efforts on initiatives designed to allow the  panels to function more efficiently. To determine the extent to which Energy policies and procedures help  employees file timely claims for state workers’ compensation benefits, we  reviewed Energy’s regulations, policies, procedures, and communications  with claimants. To estimate the number of claims for which there will not be willing  payers of workers’ compensation benefits, we reviewed the provisions of  workers’ compensation programs in the 9 states that account for more  than three-quarters of the cases filed.
Why GAO Did This Study

Subtitle D of the Energy Employees Occupational Illness Compensation Program Act of 2000 allows the Department of Energy (Energy) to help its contractors' employees file state workers' compensation claims for illnesses determined by a panel of physicians to be caused by exposure to toxic substances while employed at an Energy facility. This report examines the effectiveness of the benefit program under Subtitle D and focuses on four key areas: (1) the number, status, and characteristics of claims filed with Energy; (2) the extent to which Energy policies and procedures help employees file timely claims for these state benefits; (3) the extent to which there will be a "willing payer" of workers' compensation benefits, that is, an insurer that--by order from or agreement with Energy--will not contest these claims; and (4) a framework that could be used for evaluating possible options for changing the program.

What GAO Found

During the first 2 1/2 years of the program, ending December 31, 2003, Energy had completely processed about 6 percent of the more than 23,000 cases that had been filed. Energy had begun processing nearly 35 percent of the cases, but processing had not yet begun on nearly 60 percent of the cases. Further, insufficient strategic planning and systems limitations complicate the assessment of Energy's achievement of goals related to case processing, as well as goals related to program objectives, such as the quality of the assistance provided to claimants in filing for state workers' compensation. While Energy got off to a slow start in processing cases, it is now processing enough cases that there is a backlog of cases waiting for review by a physician panel. Energy has taken some steps intended to reduce this backlog, such as reducing the number of physicians needed for some panels. Nonetheless, a shortage of qualified physicians continues to constrain the agency's capacity to decide cases more quickly. Consequently, claimants will likely continue to experience lengthy delays in receiving the determinations they need to file workers' compensation claims. In the meantime, Energy has not kept claimants sufficiently informed about the delays in the processing of their claims as well as what claimants can expect as they proceed with state workers' compensation claims. GAO estimates that more than half of the cases associated with Energy facilities in 9 states that account for more than three-quarters of all Subtitle D cases filed are likely to have a willing payer of benefits. Another quarter of the cases in these 9 states, while not technically having a willing payer, have workers' compensation coverage provided by an insurer that has stated that it will not contest these claims. However, the remaining 20 percent of the cases in these 9 states lack willing payers and are likely to be contested. This has created concerns about program equity in that many of these cases may be less likely to receive compensation. Because of data limitations, these percentages provide an order of magnitude estimate of the extent to which claimants will have willing payers. These estimates could change as better data become available or as circumstances change, such as new contractors taking over at individual facilities. The estimates are not a prediction of actual benefit outcomes for claimants. Various options are available to improve payment outcomes for the cases that receive a positive physician panel determination, but lack willing payers. While not recommending any particular option, GAO provides a framework that includes a range of issues to help the Congress assess options if it chooses to change the current program. One of these issues in particular--the federal cost implications--should be carefully considered in the context of the current and projected federal fiscal environment. Please note that the recommendations for this report are identical to the recommendations in GAO-04-515 .