informally, we want you to know that we sincerely appreciate your interest and would welcome you most wholeheartedly.

Mr. PEASE. Thank you, Mr. Chairman. You have been a most gracious chairman for the meeting, and I enjoyed being before the committee. I want to seriously commend you for the work that you are doing on oversight of this problem, because it is a problem and it does need a lot of parts of a solution. My bill is only one small part. Thank you.

Mr. GAYDOS. Thank you.

The Chair will call the next witness, Mr. Clyde Fisk, Chief, Security and Employee Relations, Office of Personnel, U.S. Department of Agriculture.

Thank you, Mr. Fisk, for your appearance here this morning. On behalf of the committee, I want to welcome you and you may proceed in the manner that you deem best.

[The prepared statement of Mr. Fisk follows:]

STATEMENT BY CLYDE W. FISK, CHIEF, SECURITY AND EMPLOYEE RELATIONS DIVISION, OFFICE OF PERSONNEL, U.S. DEPARTMENT OF AGRICULTURE BEFORE THE SUBCOMMITTEE ON COMPENSATION, HEALTH AND SAFETY, COMMITTEE ON EDUCATION AND LABOR, U.S. HOUSE OF REPRESENTATIVES

April 10, 1978

Mr. Chairman and Members of the Subcommittee: I appreciate this opportunity to appear before your Subcomittee to comment on the administration of the Federal Employee Compensation Act by the Office of Workers' Compensation Programs and the effect of the 1974 amendments to the Act upon the overall program.

We understand that the Department of Labor recognizes the pressing need to improve the management of the program and is taking steps to do so. Complaints of employees received by my office and the observations of personnel officers and others who have a responsibility within the Department for administering the program indicates certain shortcomings.

Employees, when disabled by a traumatic injury in excess of 45 days, experience delays ranging from one month to six months before receiving a compensation check. This obviously creates an additional hardship on the employee at a time when he or she has the greatest need for financial security. Measures internal to OWCP should be taken to provide for more timely determinations and payments. A problem of timeliness of payments also exists with regard to the payment of medical claims which may be by reimbursement to the employee for medical expenses he or she has paid, or by direct payment to the physician or medical facility. Since the physician or medical facility looks initially to the employee for payment, any delay in payment by OWCP could result in an unnecessary hardship on the individual employee while waiting for reimbursement. However, to improve this situation the OWCP has instituted an accelerated bill paying system which provides immediate payment of medical bills up to $100.00 for cases not involving hospitalization and $1,500.00 for hospitalization. Consideration should be given to establishing fee schedules on a geographical basis; and the automatic payment of medical expenses of less than $300.00 with an audit of the claim being made on a post-payment basis. A related problem that sometimes occurs and seems to be unwarranted is a delay in OWCP authorizing necessary surgical procedures for employees who have a jobrelated injury or illness. When this occurs, it either delays the surgery or places a financial strain on the employee. It would seem appropriate to consider the feasibility of giving the attending physician the authority to perform any recognized medical procedure considered necessary.

A less frequent problem but one which has a great adverse impact on both the employee and his or her employing agency, is timeliness of OWCP determinations as to whether or not an employee's injury or illness is such that the employee is entitled to go on the disability rolls. This determination may take six months or longer. There have been cases where employees have not received a payment of any kind after 18 months from OWCP and have exhausted their annual and sick leave. At the same time the employing agency has a position which is occupied and thus counts against the personnel ceiling, but the employee is unable to perform the duties of the position. Appropriate measures must be taken by OWCP to improve the timeliness of its determinations.

The present chargeback billing does not provide sufficient information to insure that the billing is correct; to accurately prorate the billing among the agencies of the U.S. Department of Agriculture; or affix accountability in individual cases. Consideration should be given to furnishing supporting data with the chargeback billing which at a minimum, would identify the employee by name and social security number; give the cost for each case; and identify the employing agency within the U.S. Department of Agriculture.

To further illustrate the lack of information desirable from a point of view the current system does not provide us with the total medical payments for injuries sustained during the fiscal year. It is recommended that this information be provided.

The 1974 amendment to the Act which provides for the continuation of pay for up to 45 days for traumatic injury has had the most noticeable impact. This amendment has afforded large numbers of injured employees prompt payment of salaries. While our costs increased approximately 25 percent between 1975 and 1976 we do not have any evidence of employee abuse. A preliminary survey of the implementation of the continuation of pay provision has been made and an in depth audit is planned. At this point in time we believe our increased costs are due to increased employee awareness and the increase in employee salaries.

I want to thank you, Mr. Chairman, for offering me the opportunity to express the Department's views on this matter. We appreciate your Subcommittee's concern and efforts to make the Federal Government a model employer.

I will be pleased to answer any questions the Subcommittee may have.

[EXHIBIT A]

The following schedule is a comparative analysis of the increased costs for the five agencies surveyed for the calendar years (CY) 1975 and 1976:

STATEMENT OF CLYDE W. FISK, CHIEF, SECURITY AND EMPLOYEE RELATIONS DIVISION, OFFICE OF PERSONNEL, U.S. DEPARTMENT OF AGRICULTURE

Mr. Fisk. Mr. Chairman and members of the subcommittee, I appreciate this opportunity to appear before your subcommittee to comment on the administration of the Federal Employee Compensation Act by the Office of Workers' Compensation Programs and the effect of the 1974 amendments to the act upon the overall program.

We understand that the Department of Labor recognizes the pressing need to improve the management of the program and is taking steps to do so. Complaints of employees received by my office and the observations of personnel officers and others who have a responsibility within the Department for administering the program indicates certain shortcomings.

Employees, when disabled by a traumatic injury in excess of 45 days, experience delays ranging from 1 month to 6 months before receiving a compensation check. This obviously creates an additional hardship on the employee at a time when he or she has the greatest need for financial security. Measures internal to OWCP

should be taken to provide for more timely determinations and payments.

A problem of timeliness of payments also exists with regard to the payment of medical claims which may be by reimbursement to the employee for medical expenses he or she has paid, or by direct payment to the physician or medical facility. Since the physician or medical facility looks initially to the employee for payment, any delay in payment by OWCP could result in an unnecessary hardship on the individual employee while waiting for reimbursement. However, to improve this situation the OWCP has instituted an accelerated bill paying system which provides immediate payment of medical bills up to $100 for cases not involving hospitalization and $1,500 for hospitalization. Consideration should be given to establishing fee schedules on a geographical basis; and the automatic payment of medical expenses of less than $300 with an audit of the claim being made on a postpayment basis.

A related problem that sometimes occurs and seems to be unwarranted is a delay in OWCP authorizing necessary surgical procedures for employees who have a job-related injury or illness. When this occurs, it either delays the surgery or places a financial strain on the employee. It would seem appropriate to consider the feasibility of giving the attending physician the authority to perform any recognized medical procedure considered necessary.

Mr. GAYDOS. Do you mean to tell me that if an employee is advised by his physician that he needs medical treatment or surgery that he has to get approval for it?

Mr. FISK. I am told by my agency, Mr. Chairman, that apparently OWCP has some sort of medical advice committee, that on occasion they will question the medical necessity of particular surgery.

Mr. GAYDOS. Before it is rendered?

Mr. Fisk. Unless the employee wishes to engage a doctor on his own motion, and OWCP might or might not pay for it.

Mr. GAYDOS. I wonder who would answer for any of the claims that might possibly occur from such a procedure, if the person were injured because of a delay in medical treatment. I cannot understand that concept at all.

Go ahead.

Mr. CORNELL. If I might, do you think it would be appropriate in such a case to require the advice of a second physician?

Mr. Fisk. I would not see anything wrong with that. That is done in other situations.

Mr. GAYDOS. I am sorry; go ahead.

Mr. FISK. A less frequent problem, but one which has a great adverse impact on both the employee and his or her employing agency, is timeliness of OWCP determinations as to whether or not an employee's injury or illness is such that the employee is entitled to go on the disability rolls. This determination may take 6 months or longer. There have been cases where employees have not received a payment of any kind after 18 months from OWCP and have exhausted their annual and sick leave. At the same time, the employing agency has a position which is occupied and thus counts against the personnel ceiling, but the employee is unable to per

form the duties of the position. Appropriate measures must be taken by OWCP to improve the timeliness of its determinations. The present chargeback billing does not provide sufficient information to insure that the billing is correct; to accurately prorate the billing among the agencies of the U.S. Department of Agriculture; or affix accountability in individual cases.

I might add that they do provide us with data that indicates the amount of compensation of medical benefits in total on an agencyby-agency basis, but it is not broken down into medical and other costs.

Consideration should be given to furnishing supporting data with the chargeback billing which, at a minimum, would identify the employee by name and social security number; give the cost for each case; and identify the employing agency within the U.S. Department of Agriculture.

To further illustrate the lack of information desirable from a point of view the current system does not provide us with the total medical payments for injuries sustained during the fiscal year. It is recommended that this information be provided.

The 1974 amendment to the act which provides for the continuation of pay for up to 45 days for traumatic injury has had the most noticeable impact. This amendment has afforded large numbers of injured employees prompt payment of salaries. While our costs increased approximately 25 percent between 1975 and 1976 we do not have any evidence of employee abuse.

A preliminary survey of the implementation of the continuation of pay provision has been made and an indepth audit is planned. At this point in time we believe our increased costs are due to increased employee awareness and the increase in employee salaries.

I want to thank you, Mr. Chairman, for offering me the opportunity to express the Department's views on this matter. We appreciate your subcommittee's concern and efforts to make the Federal Government a model employer.

I will be pleased to answer any questions the subcommittee may have.

Mr. GAYDOS. Mr. Fisk, what are some of your duties in your official capacity as Chief of the Employee Relations Division? What do you do?

Mr. FISK. At this point in time, I have, under my jurisdiction, the personnel security program, occupational safety and health program, the medical units, and the departmentwide retirement program and the OWCP program from a departmental level. That is in my purview.

Mr. GAYDOS. As far as the workmen's compensation program, what do your duties entail?

Mr. Fisk. The duties are at the departmental level inasmuch as Agriculture is some 20-odd agencies and is decentralized, basically we would communicate with the Department of Labor, the agencies would communicate with my office on occasion to the Department of Labor and we would be responsible for providing the Department of Labor with the recurring reports, giving guidelines, instructions, things of that nature.

Mr. GAYDOS. How about the security business. What is that?

Mr. FISK. That relates to those individuals who have a need for classified information. We would process the investigation and issue the clearances.

Mr. GAYDOS. Do you agree with what the Department has stated to the Committee, that this is no problem as far as the Department generally is concerned-I am talking about the dramatic increase in payments, compensation payments and claims.

Mr. FISK. Mr. Chairman, of course, we have not experienced the increases that some agencies have. We have roughly 25 percent since this report was submitted. I have a preliminary readout for 1977. It looks like our costs have stabilized. I do not know how to explain that in relation to other Government agencies. We are running at about $11 per employee on a permanent full-time basis for continuation of pay.

Mr. CORNELL. Mr. Chairman, according to the testimony our colleague gave us, the compensation costs for the Department of Agriculture almost doubled.

Mr. FISK. Are you referring to continuation of pay, Mr. Cornell, or total?

Mr. CORNELL. Total.

Mr. FISK. I do not have those costs with me.

Mr. CORNELL. The same is true between 1975 and 1977 for COP costs, from $596,000 to $924,000.

Mr. FISK. The figures that I was furnished from, supposedly the reports that went to OWCP, were among the five largest agencies of Agriculture.

Mr. CORNELL. I note in your statement, you are talking about the increased costs between 1975 and 1976. Now, these are the costs

Mr. FISK. The continuation of pay only.

Mr. CORNELL. The continuation of pay costs between 1975 to 1977, according to this figure, went from $581,000 to $924,000, which is certainly far more than a 25-percent increase.

Mr. Fisk. The 25 percent, Mr. Cornell, was 1975-76. Now, the preliminary figures which I have would, for the same five agencies-

[Pause.]

Mr. Cornell, this is the total for the entire Department of Agriculture. The figures in the exhibit are for the five major agencies, our largest employers, and where the bulk of the costs are found. Mr. CORNELL. You will note, even if you take a few agencies or the whole thing, that the increased costs have been tremendous. You are talking here of an increase of 70 percent or more. Mr. FISK. I can furnish comparable figures for 1977 to the Committee at a later date to compare with these five agencies, if you desire.

Mr. CORNELL. I just think that we are talking about the Department of Agriculture in general, and the increase has been large, both in compensation and the COP. Incidentally, do you have any figures on the number you mentioned? Do you have any increase in the number of those who actually received disability compensation, the increase from 1974 to 1977?

Mr. FISK. None other than that which is reflected in this exhibit A, which does reflect the number of employees who file claims.