A typical War Hazards Compensation Act (“WHCA”) case arises when a Defense Base Act (“DBA”) employee is injured by a “war-risk hazard,” as that term is defined by 42 U.S.C. § 1711. “War-risk hazards” can include the violent actions of a hostile force or person, or an aircraft or vessel mishap in a zone of hostilities. Id. Most WHCA claims involve insurance company reimbursement. Once a DBA claim has resolved, a carrier applies for reimbursement for the amounts paid. In certain circumstances, a request can be made for both the reimbursement of benefits previously paid and the “direct payment” of future benefits. If accepted, the Division of Federal Employees’ Compensation (“DFEC”) will assume payments in the place and stead of the insurance carrier. DFEC may pay future indemnity or death benefits and, where applicable, future medical benefits. 42 U.S.C. § 1704.
The regulations promulgated for the direct payment of benefits provide a general framework that must be adhered in order to submit the request. The necessary elements for the direct payment of benefits are: (1) the right of the person or persons entitled to benefits must be established; (2) the insurance carrier requesting the direct payment of benefits must be entitled to reimbursement; (3) the beneficiary’s compensation or benefit rate must be relatively fixed and known; and, (4) the period for which the beneficiary would be entitled to payment must be relatively fixed and known. 20 C.F.R. § 61.105.
A claim for direct payment has similar documentary requirements as other claims for reimbursement under Section 104(a), and as such must comply with 20 C.F.R. § 61.101. An interpretive Bulletin published by the Department of Labor provides that claims for the direct payment of benefits require a compensation order: “absent extraordinary circumstances, only a compensation order will meet the regulatory requirement of the regulations that ‘the rate of compensation or benefit and the period of payment have become relatively fixed and known.’” See OWCP Bulletin No. 05-01.
In addition to the direct payment of compensation, the Department of Labor may also provide the direct payment of future medical care. Section 61.105(d) provides that: “medical care for the effects of a war-risk injury may be furnished in a manner consistent with the regulations governing the furnishing of medical care under the Federal Employees’ Compensation Act…” 20 C.F.R. § 61.105(d).
When a request for the direct payment of benefits is approved, DFEC will assume payment to the beneficiaries following coordination with the employer and carrier. After providing a specified date, the claim will be transferred from the employer and carrier to DFEC, and the claim will be placed on the periodic roll. From that time forward, the beneficiary should communicate directly with DFEC for claims purposes (e.g., submitting bills, changes of address, changes in marital or student status). See DFEC Procedure Manual, Part 4, at 37.
(Note: I originally published this post on Navigable Waters: A Maritime, Longshore and Defense Base Act Blog.)