EEOICPA BULLETIN NO.05-04
Expiration Date: July 1, 2006
NOTE: This Bulletin replaces Bulletin No. 04-08, Revised procedures for deducting judgment or settlement payments.
Subject: Procedures for deducting payments received for final judgments or settlements from EEOICPA benefits under Part B and/or new Part E.
References: 42 U.S.C. § 7385 and 20 C.F.R. § 30.505(b).
Purpose: To provide updated procedures and a modified Worksheet for making the required reduction of EEOICPA benefits.
Applicability: All staff.
1. When evidence in the case file suggests that a payment for an occupational illness compensable under Part B or a covered illness compensable under Part E has been received by someone (not just the employee or a deceased employee’s survivor), a letter must be sent to the claimant asking for copies of documents in his or her possession relating to the lawsuit, such as any complaint (whether or not it was filed in court), any settlement agreement, and any itemized list of expenses submitted with an attorney’s bill. The claimant should be asked to contact the attorney who filed the lawsuit to obtain copies of these documents if the claimant does not have them. The CE may also need to ask for more evidence or explanation before determining the dollar amount of the settlement or award payment(s) made for an occupational illness compensable under Part B or a covered illness compensable under Part E, and to whom the payment(s) was made.
2. Attachment 1 consists of the revised “EEOICPA Benefits Offset Worksheet.” This Worksheet is to be used by the CE to make the calculations necessary to determine how much to “offset” (reduce) a claimant’s Part B and/or Part E EEOICPA benefits to reflect payments received from a final judgment or a settlement in a lawsuit that sought damages for an occupational illness compensable under Part B, or a covered illness compensable under Part E. The Worksheet includes detailed instructions on how to compute the different figures that the CE enters on the Worksheet and are used to calculate the amount of any offset. After completing the Worksheet, the designated CE files it in the claimant’s case record.
3. If the amount of EEOICPA benefits (which may consist of lump-sum payments and/or post-filing and ongoing medical benefits) to which the claimant is currently entitled is MORE than the offset, the balance due the claimant will be listed on Line 7b of the Worksheet. This is the amount of EEOICPA benefits that must be referenced in the recommended decision, together with an explanation of how this amount was calculated.
4. If the amount of EEOICPA benefits is LESS than the offset, the amount of the “surplus” is listed on Line 7c of the Worksheet. Because a surplus can only be absorbed from EEOICPA benefits due an employee currently or in the future, no further action is required for a survivor claim. If there is a surplus to be absorbed in an employee’s Part B claim, this must be noted in the recommended decision, along with an explanation that OWCP will not pay medical benefits and will apply the amount it would otherwise pay (directly to a medical provider, or to reimburse an employee for ongoing medical treatment) to the remaining surplus until it is absorbed. If there is a surplus to be absorbed in an employee’s Part E claim, this same explanation needs to appear in the recommended decision, PLUS an explanation that OWCP will also not pay any further lump-sum payments for wage-loss and/or impairment due in the future until the surplus is absorbed.
5. In situations involving a surplus, the FAB issues an award letter to the claimant containing special language. The FAB award letter accompanies the final decision and advises the claimant of the exact amount of the surplus. The award letter explains that the surplus will be absorbed out of medical benefits payable under EEOICPA (and further lump-sum payments due in the future in Part E claims). The award letter further instructs the claimant to submit proof of payment of medical bills to the district office until notice is received that the surplus has been absorbed. In addition, claimants are instructed to advise medical providers to submit proof of payment of medical bills to the district office during this time.
6. In all claims described in Item 5 above, upon issuance of the final decision the FAB representative will update ECMS in the condition status field with the “O” (Offset) code for the affected medical condition(s) on the medical condition screen for the Employee’s claim. The offset will only apply to the Employee’s claim, even in the event that the Employee died prior to adjudication of the case, and the survivor is entitled to compensation. The ECMS process for Part B and Part E claims is as follows:
Offset for a Living Employee: For any medical condition(s) that will be affected by a surplus, the FAB representative:
a) Updates the condition status field for the medical condition(s) from “A” (Accepted, entered by the district office) to “O” (Offset) on the Employee Medical Condition screen;
b) Confirms that the corresponding medical status effective date is equal to the Employee’s claim filing date; and
c) Confirms that the corresponding data for the medical condition(s) is correct (condition type, ICD-9 code and diagnosis date).
Offset for a Deceased Employee: For any medical condition(s) that will be affected by a surplus, the FAB representative:
Confirms the “C3” claim status code was entered in the Employee’s claim
status history screen, with a status effective date of the date stamp of
b) Adds or updates the actual date of the Employee’s death in the DOD (Date of Death) field in the Employee Census Information box of the case screen;
c) Updates through the Employee’s claim, the condition status field for the medical condition(s) to “O”(Offset) on the Employee Medical Condition screen;
d) Updates or confirms that the corresponding medical status effective date is equal to the Employee’s claim filing date; and
e) Updates or confirms that the corresponding data for the medical condition(s) is correct (condition type, ICD-9 code and diagnosis date).
As an award automatically generates an eligibility file at the medical bill processing center, the “O” code acts as a “suspend” code and will not permit medical bill payment until the surplus is absorbed and the “O” code is removed from the condition status screen. During the time in which the “O” code remains in the medical condition status screen, the medical bill processing center will return all bills received on a surplus file to the claimant or the billing provider indicating that the bill can not be paid at this time due to a surplus.
7. During the time in which a surplus is in effect, the district office offset point of contact (POC) will be responsible for tracking surplus depletion. The FAB award letter will inform the claimant and medical providers to send all proofs of payment of medical bills to the offset POC. Should an unpaid bill be submitted to the offset POC during the surplus period, it will be returned to the claimant or the billing provider indicating that it can not be paid at that time due to the existence of a surplus. During the time in which the surplus is being monitored for depletion, the POC will tabulate the amounts of the proofs of payment until they equal or exceed the surplus amount. Once the proofs of payment monitored by the offset POC equal the surplus amount, all future medical bills in excess of the surplus amount will be paid under EEOICPA.
8. Once the surplus is absorbed, the DO offset POC updates the medical condition(s) of the Employee’s claim in ECMS to reflect that the offset(s) is complete. The POC will change the “O” (Offset) in the status field and replace it with an “A” (Accepted) code. If the Employee is deceased, the POC will confirm that the eligibility end date is equal to the actual date of the Employee’s death. The POC then enters a comment into ECMS case notes indicating that the surplus has been absorbed and that all future medical bills will be paid under EEOICPA. Once the “A” code is entered into the Medical Condition Status screen in ECMS, the payment eligibility file will become active. The POC confirms that the status effective date is the Employee’s claim filing date. Upon entering the “A” code into ECMS, the offset POC will send a letter advising the claimant that the surplus is absorbed. The letter will provide the claimant with the address of the medical bill processing center and instruct him or her to submit all future unpaid medical bills to that address for review and payment. At that point, the offset POC will send a copy of all proofs of payment received during the time in which the surplus was in force to the medical bill processing center. The medical bill processing center will maintain a record of these proofs of payment to guard against payment of these previously rejected or otherwise unprocessed bills.
9. During any period when medical benefits are
Disposition: Retain until incorporated in the Federal (EEOICPA) Procedure Manual.
PETER M. TURCIC
Director, Division of Energy Employees
Occupational Illness Compensation
Attachment 1: EEOICPA Part B/E Benefits Offset Worksheet
Distribution List No. 1: Claims Examiners, Supervisory Claims Examiners, Technical Assistants, Customer Service Representatives, Fiscal Officers, FAB District Managers, Operation Chiefs, Hearing Representatives, District Office Mail & File Sections