Improving Oversight of Federal Employees' Compensation Act Program

In fiscal year 2006, the Federal Employees' Compensation Act (FECA) program paid more than $1.8 billion in wage-loss compensation to federal employees who were unable to work after being injured on the job. GAO's recent work found that the Office of Workers Compensation Program (OWCP), which oversees FECA, does not provide sufficient oversight to ensure that only eligible individuals receive those payments and that the amounts are correct. OWCP relies on unverified, self-reported information from claimants that is not always timely or correct, and it does not systemically match its data on FECA claimants with earnings data from other federal agencies, which may result in a failure to identify cases of unreported earnings. GAO recommended that OWCP take several steps to ensure that only individuals who are eligible for FECA payments receive them, including seeking legal authority to enter a data-matching agreement with the Department of Health and Human Services to identify FECA claimants who have earnings reported in the National Directory of New Hires. OWCP is investigating the feasibility of this recommendation, including weighing the costs of conducting such a match against the potential overpayments that could be identified. OWCP should also ensure that the amounts payees receive are accurate and take prompt action to recover overpayments. While OWCP began taking steps to address this issue and some improvements have been made, GAO believes the agency should focus more attention on these payments and strike an appropriate balance between service delivery and payment accuracy, which could yield millions of dollars in savings.

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Federal Workers' Compensation: Better Data and Management Strategies Would Strengthen Efforts to Prevent and Address Improper Payments

GAO-08-284, February 26, 2008

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