Government Shut Down and Workers’ Compensation

Share This Article

With the federal government shutdown still in place, many of you probably have questions about its direct impact on your workers’ compensation claims. Two important federal government players are noteworthy.

1. U.S. Department of Labor.

This includes the Office of Administrative Law Judges (OALJ) and the Office of Workers’ Compensation Programs (OWCP). These are the two agencies that adjudicate and administer the Longshore and Harbor Workers’ Compensation Act (LHWCA) and its extensions. Both Offices are closed. This means that no hearings will take place, no Informal Conferences will occur, no settlements can be approved, and filing deadlines are postponed. The Chief Administrative Law Judge has issued a general order regarding the status of hearings and filing deadlines during the suspension of Federal government services, which can be viewed here. The abrupt halt to the administration of these injured worker claims can be particularly costly to Employer/Carriers who are continuing to pay benefits while awaiting adjudication or settlement, and even devastating to injured workers who’s benefits have been denied or suspended pending adjudication or settlement. Additionally, the long term ramifications of the shutdown of these operations remains to be seen; however, I expect that the effects of the shutdown will be felt for a long time after government gets back to work. It could takes months, or longer, to clear the backlogs that will be created by this hiatus. We will keep you posted as the saga continues. Please contact us if you any specific questions about what you should do with your claims while we wait; and we can certainly offer assistance with getting your claims back on track once the machine starts cranking again.

2. Centers for Medicare/Medicaid Services.

Although CMS offices are not fully operational, and much of the staff are being furloughed, the contractors will continue normal operations. The government shutdown will NOT result in termination of operations at the Workers’ Compensation Review Contractor (WCRC), the entity responsible for the review of Medicare Set-Aside submissions, and the Medicare Secondary Payer Recovery Contractor (MSPRC), the entity that handles the recovery of conditional payments on behalf of Medicare. While this means that Medicare Set-Asides that have been and will be submitted to the WCRC may continue to be reviewed, because the final approval of an MSA is issued by the CMS Regional Offices, and these offices are not contractors, but are part of the Federal Government, there may be delays in receiving the final approval of submitted Medicare Set-Asides. Therefore, although operations will not cease, with each added shutdown day, the backlog of paperwork increases.

Some other things to note: the US Postal Service is self-funded and will continue its normal operations; government agencies and services that are funded separately from the funding that is presently being impacted will continue; for example, law enforcement offers will stay on the job; key government functions, such as air traffic control, remain functional under emergency funding statutes. Also, the US Department of Veterans Affairs and Social Security Administration are funded by long-term or mandatory appropriations and are thus are largely unaffected.

And what about if you do business with the government? Do you still work? Will you be paid? What do you do with your employees? For answers to these and other questions, check out our Vandeventer Black’s Construction Law Blog.

See what our legal team can do for your business.

Upcoming Events
Stay Connected
    Your Cart
    Your cart is empty