Energy Employees Compensation
Actions to Promote Contract Oversight, Transparency of Labor's Involvement, and Independence of Advisory Board Could Strengthen Program Gao ID: GAO-08-4 October 26, 2007Congress enacted a program to compensate Department of Energy employees and contractors in the atomic weapons industry who developed work-related illnesses. Department of Labor (Labor) administers the program using estimates of workers' likely radiation exposure to decide claims. The estimates are produced by Health and Human Services' (HHS) National Institute for Occupational Safety and Health (NIOSH) and reviewed by the Advisory Board on Radiation and Worker Health. NIOSH awarded a contract to Oak Ridge Associated Universities (ORAU) to help carry out its work. GAO examined: (1) costs and oversight of NIOSH's contracts, (2) implementation of the conflict of interest policy for NIOSH and its contractors, (3) the extent of Labor's involvement in NIOSH's activities and actions to deny benefits, and (4) challenges to advisory board independence and options to enhance it. GAO reviewed contract files, examined Labor's comments on NIOSH documents, and analyzed data on cases sent to NIOSH for rework.
ORAU's contract costs almost tripled from $70.1 million to $198.7 million because the original cost estimate significantly underestimated program complexity and resources needed. The contractor ran into complexities such as unavailable or incomplete radiation monitoring records, forcing the use of more staff resources to estimate workers' radiation exposure. Labor costs were particularly expensive because of the need for technical expertise. NIOSH established procedures to monitor overall contractor performance and focused on expediting claims processing, achieving considerable progress. However, its oversight of contractor costs was insufficient and NIOSH relied primarily on external audits to validate labor charges. These audits are not a substitute for preventive controls needed to ensure that the agency reimburses only allowable costs charged by the contractor. NIOSH has issued a comprehensive conflict of interest policy. Because there are a limited number of experts with knowledge of Energy sites, the contractor often hires individuals who previously worked at these sites, and this policy attempts to incorporate their input while avoiding conflicts of interest that could have a detrimental effect on claimants. Most policy provisions have been implemented, but with some delays. As a result, NIOSH has not yet audited disclosure forms or imposed any applicable penalties. Labor's extensive involvement in commenting on draft NIOSH technical documents used to estimate radiation doses and returning cases to NIOSH for rework did not indicate a systematic effort to deny benefits paid to claimants, but Labor's rationale for its comments was not always transparent. A detailed explanation was needed for GAO to understand how certain comments made the NIOSH documents more clear and consistent and how this would facilitate Labor's adjudication of cases. For example, one comment suggested that NIOSH was being overly favorable to claimants and upwardly biasing their dose estimates by using data from a group of monitored workers at a particular site to estimate radiation doses for unmonitored workers at other sites. However, Labor explained it was seeking clarification to adjudicate cases where claimants might object to their estimate being based on a site where they had never worked. GAO's analysis of the 2,811 cases that Labor returned to NIOSH for rework as of March 2007 did not indicate an effort to deny benefits because 87 percent of the cases had less than a 50 percent probability of causation, based on NIOSH's initial dose reconstruction, and thus likely would have been denied. While GAO did not find evidence that the advisory board was impeded in performing its statutory duties, issues pertaining to the board's funding structure, member appointment process, and support staff present challenges to its independence. Various options are available to enhance independence such as appropriating funds in a separate line item for the board, establishing bipartisan Congressional involvement in appointing board members, and developing procedures to ensure support staff is independent of the program.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-08-4, Energy Employees Compensation: Actions to Promote Contract Oversight, Transparency of Labor's Involvement, and Independence of Advisory Board Could Strengthen Program
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Report to the Chairwoman, Subcommittee on Immigration, Citizenship,
Refugees, Border Security, and International Law, Committee on the
Judiciary, House of Representatives:
United States Government Accountability Office:
GAO:
October 2007:
Energy Employees Compensation:
Actions to Promote Contract Oversight, Transparency of Labor's
Involvement, and Independence of Advisory Board Could Strengthen
Program Energy Employees Compensation:
GAO-08-4:
GAO Highlights:
Highlights of GAO-08-4, a report to the Chairwoman, Subcommittee on
Immigration, Citizenship, Refugees, Border Security, and International
Law, Committee on the Judiciary, House of Representatives.
Why GAO Did This Study:
Congress enacted a program to compensate Department of Energy employees
and contractors in the atomic weapons industry who developed work-
related illnesses. Labor administers the program using estimates of
workers‘ likely radiation exposure to decide claims. The estimates are
produced by Health and Human Services‘ (HHS) National Institute for
Occupational Safety and Health (NIOSH) and reviewed by the Advisory
Board on Radiation and Worker Health. NIOSH awarded a contract to Oak
Ridge Associated Universities (ORAU) to help carry out its work. GAO
examined: (1) costs and oversight of NIOSH‘s contracts, (2)
implementation of the conflict of interest policy for NIOSH and its
contractors, (3) the extent of Labor‘s involvement in NIOSH‘s
activities and actions to deny benefits, and (4) challenges to advisory
board independence and options to enhance it. GAO reviewed contract
files, examined Labor‘s comments on NIOSH documents, and analyzed data
on cases sent to NIOSH for rework.
What GAO Found:
ORAU‘s contract costs almost tripled from $70.1 million to $198.7
million because the original cost estimate significantly underestimated
program complexity and resources needed. The contractor ran into
complexities such as unavailable or incomplete radiation monitoring
records, forcing the use of more staff resources to estimate workers‘
radiation exposure. Labor costs were particularly expensive because of
the need for technical expertise. NIOSH established procedures to
monitor overall contractor performance and focused on expediting claims
processing, achieving considerable progress. However, its oversight of
contractor costs was insufficient and NIOSH relied primarily on
external audits to validate labor charges. These audits are not a
substitute for preventive controls needed to ensure that the agency
reimburses only allowable costs charged by the contractor.
NIOSH has issued a comprehensive conflict of interest policy. Because
there are a limited number of experts with knowledge of Energy sites,
the contractor often hires individuals who previously worked at these
sites, and this policy attempts to incorporate their input while
avoiding conflicts of interest that could have a detrimental effect on
claimants. Most policy provisions have been implemented, but with some
delays. As a result, NIOSH has not yet audited disclosure forms or
imposed any applicable penalties.
Labor‘s extensive involvement in commenting on draft NIOSH technical
documents used to estimate radiation doses and returning cases to NIOSH
for rework did not indicate a systematic effort to deny benefits paid
to claimants, but Labor‘s rationale for its comments was not always
transparent. A detailed explanation was needed for GAO to understand
how certain comments made the NIOSH documents more clear and consistent
and how this would facilitate Labor‘s adjudication of cases. For
example, one comment suggested that NIOSH was being overly favorable to
claimants and upwardly biasing their dose estimates by using data from
a group of monitored workers at a particular site to estimate radiation
doses for unmonitored workers at other sites. However, Labor explained
it was seeking clarification to adjudicate cases where claimants might
object to their estimate being based on a site where they had never
worked. GAO‘s analysis of the 2,811 cases that Labor returned to NIOSH
for rework as of March 2007 did not indicate an effort to deny benefits
because 87 percent of the cases had less than a 50 percent probability
of causation, based on NIOSH‘s initial dose reconstruction, and thus
likely would have been denied.
While GAO did not find evidence that the advisory board was impeded in
performing its statutory duties, issues pertaining to the board‘s
funding structure, member appointment process, and support staff
present challenges to its independence. Various options are available
to enhance independence such as appropriating funds in a separate line
item for the board, establishing bipartisan Congressional involvement
in appointing board members, and developing procedures to ensure
support staff is independent of the program.
What GAO Recommends:
GAO recommends improving HHS contractor oversight and transparency of
Labor‘s involvement in NIOSH activities, to which HHS and Labor agreed,
and suggests that Congress consider options to enhance board
independence.
To view the full product, including the scope and methodology, click on
[hyperlink, http://wwww.GAO-08-4]. For more information, contact Daniel
Bertoni at (202) 512-7215 or bertonid@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Unanticipated Program Complexity Led to Increased Contract Costs, and
while NIOSH Established Procedures to Monitor Contractor Performance,
Its Oversight of Contractor Costs Was Insufficient:
NIOSH Has Issued a Conflict of Interest Policy and Implemented Most
Provisions after Some Delay, but Is Not Yet Monitoring or Enforcing the
Policy:
Labor's Reviews of NIOSH Documents and Returns of Cases for Rework Do
Not Indicate Systematic Efforts to Contain Benefits, but Raise Issues
about the Transparency of Labor's Involvement:
Several Issues Present Challenges to Advisory Board's Independence, and
Various Options Could Be Considered to Address Them:
Conclusions:
Recommendations for Executive Action:
Matter for Congressional Consideration:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Status of Labor's Comments on Draft Special Exposure
Cohort Petition Evaluations:
Appendix III: Comments from the Department of Energy:
Appendix IV: Comments from the Department of Labor:
Appendix V: Comments from the Department of Health and Human Services:
Appendix VI: GAO Contact and Staff Acknowledgments:
Related GAO Products:
Tables:
Table 1: Summary of Cost Increases in ORAU Contract, as of Fiscal Year
2007:
Table 2: ORAU Expenditures, by Task, as of June 2007:
Table 3: Award Fee Performance Evaluations for ORAU:
Table 4: Implementation Status of Key Conflict of Interest Policy
Provisions:
Table 5: Types of NIOSH Documents Reviewed by Labor:
Table 6: Estimated Percent of NIOSH's Draft Technical Documents, by
Nature of Labor's Comments:
Table 7: Options to Enhance Advisory Board's Independence:
Figures:
Figure 1: Responsibilities of Entities Involved in Administering
Subtitle B of EEOICPA:
Figure 2: Subtitle B Administrative Costs and Benefits Paid Out for
Dose Reconstruction Cases, Aggregated for Fiscal Years 2001-2006:
Figure 3: Trends in ORAU's Average Monthly Dose Reconstruction
Production, March 2003 through June 2007:
Figure 4: Summary of Cases Returned to NIOSH for Rework, as of March
31, 2007:
Abbreviations:
CDC: Centers for Disease Control and Prevention:
DCAA: Defense Contract Audit Agency:
EEOICPA: Energy Employees Occupational Illness Compensation Program
Act:
Energy: Department of Energy:
EPA: Environmental Protection Agency:
FACA: Federal Advisory Committee Act:
FAR: Federal Acquisition Regulation:
HHS: Department of Health and Human Services:
Labor: Department of Labor:
NIOSH: National Institute for Occupational Safety and Health:
OCAS: Office of Compensation Analysis and Support:
OMB: Office of Management and Budget:
ORAU: Oak Ridge Associated Universities:
SEC: special exposure cohort:
United States Government Accountability Office:
Washington, DC 20548:
October 26, 2007:
The Honorable Zoe Lofgren:
Chairwoman:
Subcommittee on Immigration, Citizenship, Refugees, Border Security,
and International Law:
Committee on the Judiciary:
House of Representatives:
The Energy Employees Occupational Illness Compensation Program Act of
2000 (EEOICPA)[Footnote 1] was enacted to compensate employees and
contractors of the Department of Energy (Energy) and its predecessors
who developed serious illnesses such as cancer because of exposure to
radiation, beryllium, or silica while working in the atomic weapons
industry. The Department of Labor (Labor) administers Subtitle B of the
act, which provides eligible workers with a onetime payment of $150,000
and coverage of medical expenses related to their illness. From the
program's inception through August 14, 2007, Labor received over 58,000
cases and has made benefit payments in over 17,000 of them totaling
$2.1 billion. To make compensation decisions for certain claims, Labor
uses estimates of individual workers' likely radiation exposure,
performed by scientists at the National Institute for Occupational
Safety and Health (NIOSH)[Footnote 2] and its contractors, Oak Ridge
Associated Universities (ORAU) and Battelle. If the estimate, known as
a dose reconstruction, shows at least a 50 percent probability that a
worker's cancer was caused by occupational exposure, the worker
qualifies for compensation. The act specified that the President
establish an Advisory Board on Radiation and Worker Health that is
tasked with advising the Secretary of the Department of Health and
Human Services (HHS) on the scientific validity and quality of NIOSH's
radiation dose reconstructions and recommending whether to create
special classes of workers eligible for compensation without individual
dose reconstructions, known as the special exposure cohort (SEC).
Members of the board are scientists, physicians, and employee
representatives who serve part-time on this citizens' advisory board.
There has been a significant growth in costs related to NIOSH's
contracted work to estimate radiation exposure, which was originally
negotiated to cost about $70 million when the contract was awarded in
2002, but ultimately grew to nearly $200 million by 2007. In addition,
it is important that individuals tasked with performing dose
reconstructions remain objective and neutral. However, some former
employees of the Department of Energy and its predecessors, who now
work for NIOSH and its contractors, could potentially have conflicts of
interest in their work that may result in a bias against claimants.
Further, a memorandum from the Office of Management and Budget to Labor
that came to light in 2006 has generated considerable congressional
concern about whether decisions to approve or deny claims were being
unduly influenced by budgetary considerations, rather than established
scientific procedures, given that all applicants whose claims have been
approved are entitled to receive benefits.[Footnote 3] The memorandum
and subsequent hearings raised questions about Labor's involvement in
scientific activities assigned to NIOSH and the advisory board, and
about the balance and independence of the board, which is funded
through Labor and HHS, and receives staff support from NIOSH.
To address these issues, we focused on the following questions: (1)
What are the reasons for any increases in costs for NIOSH's contractors
and what procedures did NIOSH have in place to manage the contracts?
(2) What is the conflict of interest policy for NIOSH and its
contractors and to what extent have its provisions been implemented?
(3) To what extent is Labor involved in Subtitle B activities tasked to
NIOSH and has Labor taken actions to deny benefits to eligible
claimants? (4) What challenges does the advisory board face in
maintaining its independence and what options could further strengthen
its independence?
To perform our work, we reviewed relevant laws and regulations and
contract files, and observed agency and contractor operations at
selected sites. We used internal control standards[Footnote 4] and
guidance and Federal Acquisition Regulation requirements as a basis to
assess NIOSH's contract oversight. In addition, we reviewed documents
that Labor and NIOSH provided to Congress--including agency e-mails,
internal memorandums, and other documents--in its request for
information on various aspects of their program activities. To examine
whether Labor was involved in Subtitle B activities tasked to NIOSH, we
reviewed a random sample of 79 documents from the 187 draft NIOSH
technical documents used in the dose reconstruction process for which
Labor provided comments. Our sample allowed us to estimate
characteristics for all 187 technical documents. To determine the
nature of these comments, we categorized and analyzed the comments
according to whether they focused on improving clarity and consistency,
raised questions about scientific assumptions, or fell into other
categories. In addition, we examined Labor's written comments on all
relevant SEC petition evaluations to determine whether the comments, if
implemented, would have had the effect of reducing the magnitude of the
proposed cohort of eligible claimants. To determine whether Labor took
any actions to deny benefits to claimants, we also analyzed data on
cases that Labor returned to NIOSH for rework according to their
initial compensability decision, reasons for rework, and final outcomes
following rework. Finally, we interviewed key agency officials, members
of the advisory board, and a claimant advocate. Our scope and
methodology are discussed in greater detail in appendix I. We conducted
our work from August 2006 to October 2007 in accordance with generally
accepted government auditing standards.
Results in Brief:
NIOSH significantly underestimated contract costs because it did not
anticipate the level of complexity of the project or the resources or
staff time needed. ORAU ran into complexities such as unavailable or
incomplete radiation monitoring records, which forced the contractor to
use more staff resources to review the records, develop site profiles,
and perform dose reconstructions--all of which were required to be
performed by people with technical expertise whose cost of labor is
high. NIOSH had various procedures in place to monitor overall
contractor performance by, for example, reviewing the contractors'
progress reports and holding weekly meetings with contractor staff.
NIOSH also oversaw ORAU's performance by conducting semiannual
performance evaluations and by periodically modifying performance
criteria to target key areas for improvement, such as completing the
backlog of the oldest claims. To further accelerate claims processing,
NIOSH hired a second contractor, Battelle, and while that contract
remained within its $2.9 million budget, it fell 6 months behind
schedule because of Battelle's initial slow progress. While NIOSH had
procedures in place to monitor contract performance, it did not
adequately review contractor costs. NIOSH's oversight of ORAU's costs
was insufficient to ensure that labor and other costs billed to the
government were allowable. NIOSH also performed limited reviews of
monthly contractor invoices and did not have sufficient procedures in
place to oversee ORAU's review of subcontractor costs. Additionally,
NIOSH relied on external audits for assurance that contractor and
subcontractor charges were proper.
NIOSH issued a conflict of interest policy for the dose reconstruction
program in October 2006, and while most provisions have been
implemented, NIOSH is not yet fully monitoring or enforcing the policy.
Because there are a limited number of individuals with extensive
knowledge of Energy sites, the contractor often hires employees who
previously worked at these sites. To ensure such employees carry out
their work in an objective, unbiased fashion, the policy prohibits them
from performing dose reconstructions and authoring key program
documents involving that site. Experts with an actual or perceived
conflict may still offer advisory input to the documents, as long as
their contributions are clearly attributed. The policy is comprehensive
in that it addresses all aspects of the program; covers federal,
contractor, and subcontractor employees; and applies to different types
of conflicts of interest including individual, corporate, financial,
employment-related, familial, and supervisor-subordinate relationships.
Most provisions have been implemented, although there were some delays.
In addition, while NIOSH has appointed a conflict of interest officer,
it is not yet fully monitoring or enforcing the policy by implementing
such provisions as auditing disclosure forms and imposing penalties for
missing, erroneous, or incomplete forms.
Labor has been extensively involved in reviewing NIOSH's scientific
work related to Subtitle B claims, and while Labor did not pursue a
strategy to deny benefits to eligible claimants, the agency was not
always transparent in demonstrating how its comments were intended to
facilitate Labor's adjudication of claims. The program statute and
regulations do not provide guidance on Labor's review of draft NIOSH
documents. Labor officials told us that such reviews are done to
promote clarity and consistency and help Labor adjudicate claims;
moreover, NIOSH acknowledged the value of Labor's comments in this
process. However, we found that in an estimated 11 percent of technical
documents and several SEC petition evaluations, Labor's comments
appeared to go further, and it was sometimes difficult to determine
Labor's rationale for the comments from the written documents alone.
This was especially true for comments that questioned NIOSH's
scientific assumptions or suggested that the scope of proposed SEC
class definitions should be narrowed. A detailed oral explanation from
Labor officials was subsequently needed for us to understand how the
comments made the NIOSH documents more clear and consistent and how the
resulting improvements would facilitate adjudication. For example, in a
technical document on construction workers, a comment from Labor
suggested that NIOSH was being overly favorable to claimants and
upwardly biasing their dose estimates by using data from a group of
monitored workers at a particular site to estimate radiation doses for
certain unmonitored workers at other sites. However, Labor explained to
us that it was seeking clarification of NIOSH's scientific assumptions
to help adjudicate cases where claimants might object to their dose
reconstructions being based on data from a site at which they did not
work. In addition to commenting on NIOSH's documents, Labor also
regularly returned individual radiation dose estimates to NIOSH for
rework, as contemplated by the regulations. Our analysis of statistics
on these cases did not indicate any systematic effort to deny benefits.
We found that 87 percent of the 2,811 returned cases as of March 2007
had a less than 50 percent probability of causation, based on NIOSH's
initial dose reconstruction, and thus would likely have been denied
compensation. In addition, a greater percentage of cases were reversed
in the claimant's favor following rework, with 16 percent of denied
cases switching to approvals, compared to 11 percent of approved cases
switching to denials.
While we did not find evidence that the advisory board was impeded in
performing its statutory responsibilities, issues pertaining to its
funding structure, membership appointment process, and support staff
present potential challenges to the board's independence. However,
various options are available to address these challenges. Although
advisory board members state that the board has received necessary
funding to date, because funding flows through Labor and HHS, the
agencies may be in a position to restrict the board's budget if, for
example, they dislike the board's findings regarding the addition of
new classes to the special exposure cohort. In addition, there is a
potential for HHS or Labor to unduly influence the presidential
appointment of board members in an effort to shape the outcome of the
board's decisions. For example, internal Labor correspondence in 2005
characterized the advisory board as essentially a worker advocacy
organization, noting that this would increase pressure for approving
more SEC classes and that a membership change was critical to
counteract this pressure. The advisory board also relies on HHS for
support staff, but there are no procedures in place to ensure that
these individuals are and remain independent of the program that the
board was tasked to review. We identified various options for enhancing
advisory board independence, each with its advantages and
disadvantages. Such options include appropriating funds in a separate
line item for the advisory board, establishing bipartisan Congressional
involvement in appointing board members, developing procedures to
ensure no undue influence on the advisory board, and requiring the
advisory board to report periodically to Congress and the Secretary of
HHS on any obstacles to independence it faces.
We are making a recommendation to Labor to be more transparent in its
written comments on NIOSH documents by presenting the agency's
rationale and basis for the comments. We are also making
recommendations to HHS to (1) strengthen oversight of costs incurred in
the dose reconstruction program and improve the review and approval
process for contractor billings, and (2) enhance advisory board
independence by developing procedures to ensure no undue influence on
the board, as required under the Federal Advisory Committee Act (FACA).
To further enhance board independence, we are asking Congress to
consider options related to funding, appointment of members, and
advisory board reporting. In their written comments on a draft of the
report, Labor and HHS concurred with our recommendations. However, HHS
disagreed that it had significantly underestimated the total cost of
the ORAU contract. HHS pointed out that it purposely selected a cost
reimbursement award fee contract to allow for flexibility and
management control. While we recognize that costs increased due to
unanticipated complexity, NIOSH's independent government cost estimate
of $91.3 million for the ORAU contract was considerably lower than the
$198.7 million in total actual costs incurred by the contractor. Energy
stated that it did not have any comments on the report. Comments from
Energy, Labor, and HHS are provided in appendices III through V.
Background:
Several different federal agencies are involved in implementing the
Subtitle B program (see fig. 1). As the agency with primary
responsibility for administering claims under Subtitle B, Labor
receives the claims and determines whether claimants meet eligibility
requirements. When considering the compensability of certain claims,
Labor relies on estimations of the levels of radiation particular
workers were likely exposed to when working for Energy. These
estimations are known as dose reconstructions and are developed by
NIOSH, within the Department of Health and Human Services. To avoid
gathering redundant information for each claim associated with a
particular facility, NIOSH compiles facility-specific information in
technical documents called site profiles, which assist NIOSH in
completing the dose reconstructions. To help it carry out its work,
NIOSH awarded a 5-year contract to ORAU in September 2002 as well as a
1-year contract to Battelle in October 2005.
Figure 1: Responsibilities of Entities Involved in Administering
Subtitle B of EEOICPA:
This figure is a chart with illustrations showing the responsibilities
of entitites involved in administering subtitle B of EEOICPA.
[See PDF for image]
Source: GAO analysis.
[End of figure]
However, Labor does not refer all claims to NIOSH for dose
reconstruction because reconstructions are not needed for certain
workers who constitute an SEC.[Footnote 5] Workers from four specific
sites have been designated by the act as members of this special class,
and classes of workers from another 16 sites have been added to the SEC
as of August 2007 because exposure records were insufficient and there
is reasonable likelihood that the workers' cancer was caused by
radiation exposure.[Footnote 6] Thus, for workers' claims at an SEC-
designated facility, Labor simply verifies the employment period and
illness and develops a recommended decision that is issued to the
claimant--fast-tracking the process.
The costs of administering the Subtitle B dose reconstruction program
have been substantial over the past 5 years. Of the 53,850 cases Labor
reported receiving, Labor referred 21,266 (39 percent) to NIOSH for
dose reconstruction in fiscal year 2006. From fiscal years 2001 through
2006, Labor, NIOSH, and Energy spent an aggregate of $325 million to
administer the dose reconstruction program, and Labor paid out nearly
$512 million in compensation benefits to claimants for whom NIOSH
performed dose reconstructions over the same period (see fig. 2). Of
the three agencies, NIOSH incurred the greatest administrative costs--
$180.6 million--to carry out such activities as dose reconstructions
and preparing site profiles.[Footnote 7] Labor spent an estimated
$125.9 million to adjudicate dose reconstruction claims.[Footnote 8]
Finally, Energy spent about $18.5 million to respond to NIOSH's
requests for monitoring records needed to complete dose reconstructions
and Labor's requests for employment verifications necessary to
adjudicate claims.[Footnote 9]
Figure 2: Subtitle B Administrative Costs and Benefits Paid Out for
Dose Reconstruction Cases, Aggregated for Fiscal Years 2001-2006:
This figure is a bar chart showing subtitle B administrative costs and
benefits paid out for dose reconstruction cases, aggregated for fiscal
years 2001-2006.
[See PDF for image]
Source: GAO analysis of information from Labor, NIOSH, and Energy.
Note: Administrative costs include such items as personnel, travel,
rental payments, utilities, printing, facility operations and
maintenance, supplies and materials, and equipment. NIOSH did not begin
incurring dose reconstruction costs until fiscal year 2002.
[End of figure]
The advisory board also plays an important role in the Subtitle B
program. Created in 2000, the advisory board has 12 members and is set
to terminate in 2009 unless renewed.[Footnote 10] EEOICPA requires that
the membership of the advisory board reflect a balance of scientific,
medical, and worker perspectives. The advisory board is also subject to
FACA,[Footnote 11] and is responsible for advising the Secretary of HHS
on the scientific validity and quality of NIOSH's dose reconstruction
efforts and whether workers at other locations should be added to the
SEC. For its part, HHS provides administrative services, funds,
facilities, staff, and other necessary support to the advisory board.
To assist the advisory board in its efforts, HHS awarded a 5-year $3
million contract to Sanford Cohen and Associates in October 2003 to
review such things as the scientific validity and quality of individual
dose reconstructions and site profiles. GAO recently examined how well
the advisory board and the contractor assisting the advisory board have
carried out these reviews.[Footnote 12]
In 2006, an internal memorandum from the Office of Management and
Budget (OMB) to Labor generated considerable congressional concern
about the potential for inappropriate efforts to contain the cost of
benefits paid to claimants. The memorandum notes Labor's concern about
the potential for a large expansion of benefits through the designation
of the SEC and further states that the Administration planned to
convene a White House-led interagency workgroup to develop options to
contain growth in the costs of program benefits. The memorandum
specifically identifies five options, including requiring additional
administrative clearance of the SEC and addressing any "imbalance" in
advisory board membership.[Footnote 13] While it is reasonable for OMB
to have a role in overseeing the costs of federal programs, some have
raised concerns that certain options set forth in the memorandum, if
implemented, could result in decisions unduly based on budgetary
considerations rather than established scientific procedures for
compensating workers under this program. Congress held several
oversight hearings on these issues in 2006, at which OMB and Labor
officials testified that they had taken no actions, nor had any plans,
to implement any of the options cited in the OMB memorandum.
Unanticipated Program Complexity Led to Increased Contract Costs, and
while NIOSH Established Procedures to Monitor Contractor Performance,
Its Oversight of Contractor Costs Was Insufficient:
NIOSH significantly underestimated the costs of its 5-year contract
with ORAU primarily because it did not accurately predict the level of
complexity and resources--particularly labor costs--the contractor
would need to commit to the project to get the job done. The contractor
ran into complexities such as unavailable or incomplete radiation
monitoring records, forcing it to use more staff resources to review
the records, develop site profiles, and perform dose reconstructions.
Because the people performing these tasks require technical expertise,
the cost of their labor is high, and increases in staff time are very
expensive. NIOSH established procedures to oversee contractor
performance such as reviewing the contractors' progress reports and
justification for cost increases. NIOSH's oversight of ORAU also
consisted of semiannual evaluations that focused on increasing claims
processing, and ORAU's productivity and performance ratings improved in
these areas over time. To further accelerate claims processing, NIOSH
hired a second contractor, Battelle, which remained within budget but
fell 6 months behind schedule because of initial slow progress.
However, NIOSH's oversight of ORAU's costs was insufficient to provide
reasonable assurance of the appropriateness of labor and other costs
billed to the government. NIOSH also did not have sufficient procedures
in place to oversee the prime contractor's review of subcontractor
costs. In addition, the agency relied primarily on external audits for
assurance that contractor and subcontracter charges were proper. NIOSH
will award another dose reconstruction contract following expiration of
the ORAU contract in the fall of 2007. While officials believe that the
cost estimate of the new contract is more realistic, the extent of any
future cost growth remains to be seen.
NIOSH Significantly Underestimated Cost of ORAU's 5-Year Contract
because of Unanticipated Program Complexity:
NIOSH awarded a 5-year contract to ORAU for $70.1 million for the
period September 2002 to September 2007.[Footnote 14] ORAU was awarded
a cost reimbursement contract that also provided an award fee for
meeting performance goals. Neither NIOSH nor the contractor had
performed dose reconstructions on a scale as large as the one required
to carry out the program. Given this limited prior experience, the
agency significantly underestimated the complexity of the work and the
labor costs required to complete the project. The government's
independent cost estimate developed by NIOSH was $91.3 million, a
figure that was substantially lower than the amount subsequently spent
on the contract over the project's life. In its comments, HHS told us
that NIOSH and the contracting office selected a cost reimbursement
award fee contract as a mechanism to allow for flexibility and
management control, in light of the considerable uncertainty associated
with the project.
Once the dose reconstruction program got under way, the complexity of
the work forced the contractor to commit more staff resources at
additional cost to the government. ORAU officials told us, for example,
that they committed more staff hours than the contract originally
estimated to reviewing records from Energy facilities because the
records could not always be located, were not easily accessible, or
were incomplete. ORAU also hired additional staff, and staffing levels
rose from 24 in September 2002 when the contract was awarded, to a high
4 years later of 476, and leveled off at 232 as of June 2007. In
addition, NIOSH had to adjust its approach to performing the work.
NIOSH initially expected to perform dose reconstructions while
simultaneously developing technical documents,[Footnote 15] such as
site profiles, but subsequently found that it needed to first complete
the site profiles to avoid having to collect site-related information
on a case-by-case basis. While this approach facilitated the dose
reconstruction process, it required a much greater upfront investment
of staff time and resources.[Footnote 16] Labor charges were
particularly high for this project, because there is a limited pool of
specialists with the requisite technical expertise to estimate
radiation doses and perform other tasks. For example, at $55.9 million,
direct labor charges accounted for about 92 percent of the $61 million
cost increase approved in July 2006.
As table 1 shows, the cost of the ORAU contract almost tripled from
$70.1 million to $198.7 million. While program complexity was a factor
in the cost increase, NIOSH officials told us that the volume of claims
received from Labor did not play a role in increasing costs. The
request for proposal required the contractor to process anywhere from
15,000 to 41,000 claims over the 5-year period, and the actual number
of claims processed was within that broad range. Other than the number
of claims to be processed, however, the request for proposal did not
define quantifiable requirements for any of the other tasks for which
the contractor was responsible, such as conducting dose reconstruction
research and interviewing claimants. This lack of well-defined
requirements at the outset meant that NIOSH and the contractor had to
determine the specific tasks and level of resources needed to
accomplish them as the project went along, making it difficult to plan
for the long term and increasing the likelihood that costs would grow
as the contractor's workload grew.
Table 1: Summary of Cost Increases in ORAU Contract, as of Fiscal Year
2007:
Dollars in millions.
September 2002;
Funding amount: $70.1;
Description: Original contract award amount.
May 2003;
Funding amount: 2.9;
Description: Relocation of claimant interviewers to off-site location.
March 2004;
Funding amount: 1.9;
Description: Increase in indirect billing rates for a subcontractor.
January 2005;
Funding amount: 69.3;
Description: NIOSH direction to significantly increase level of effort
in developing site profiles and technical basis documents, producing
dose reconstructions, and conducting worker outreach.
June 2006;
Funding amount: 4.5;
Description: Continuation of high level of production through July 2006
while negotiations were being completed on the amount needed to
complete the final 13.5 months of the contract.
July 2006;
Funding amount: 61.0[A];
Description: NIOSH direction to significantly increase level of effort
in developing site profiles and technical basis documents, producing
dose reconstructions, conducting worker outreach, and reviewing and
responding to technical findings from the advisory board.
June 2007;
Funding amount: (15.7);
Description: Reduction in available funding for the contract due, in
part, to the continuing resolution in fiscal year 2007.
July 2007;
Funding amount: 2.4;
Description: Continuation of priority tasks, such as dose
reconstruction and SEC petition evaluations, through the end of the
contract period.
September 2007;
Funding amount: 2.3;
Description: Continuation of priority tasks, such as dose
reconstruction and SEC petition evaluations, through the end of the
contract period.
Total;
Funding amount: $198.7;
Description: Total amount awarded over life of contract.
Source: GAO analysis of information from the Centers for Disease
Control and Prevention's Procurement and Grants Office.
[A]While this was the funding amount proposed by the contractor, NIOSH
did not fund the full amount because it was operating under a
continuing resolution in fiscal year 2007.
[End of table]
An expansion of the contractor's tasks also accounted for 15 percent of
the cost increase. ORAU was originally assigned six tasks related to
performing dose reconstructions and developing site profiles. NIOSH and
the contractor later added five more tasks. Some tasks, such as
preparing SEC petition evaluations and responding to advisory board
reviews, were added as NIOSH gained a better understanding of the level
of support it needed from ORAU, while another was added in response to
NIOSH's concern that different tasks within ORAU were not well
coordinated and that the contractor lacked a sense of urgency toward
accomplishing the work. Of all the tasks assigned to ORAU, dose
reconstruction was by far the costliest, accounting for over a third of
total expenditures, followed by dose reconstruction research (which
included developing site profiles), as shown in table 2.
Table 2: ORAU Expenditures, by Task, as of June 2007:
Dollars in millions.
Dose reconstruction;
Cumulative expenditures: $68.21;
Percentage of total: 37.
Dose reconstruction research;
Cumulative expenditures: 44.59;
Percentage of total: 24.
Database management;
Cumulative expenditures: 15.88;
Percentage of total: 9.
Identify and obtain relevant data;
Cumulative expenditures: 13.66;
Percentage of total: 7.
Claimant interviews;
Cumulative expenditures: 12.77;
Percentage of total: 7.
Technical and program management support;
Cumulative expenditures: 9.30;
Percentage of total: 5.
SEC petition evaluations;
Cumulative expenditures: 6.68;
Percentage of total: 4.
Records management;
Cumulative expenditures: 7.77;
Percentage of total: 4.
Quality assurance;
Cumulative expenditures: 2.23;
Percentage of total: 1.
Integration of scientific issues;
Cumulative expenditures: 2.78;
Percentage of total: 1.
Responding to advisory board and contractor assisting the board;
Cumulative expenditures: 1.48;
Percentage of total: 1.
Total;
Cumulative expenditures: $185.35;
Percentage of total: 100.
Source: GAO analysis of ORAU expenditure data.
Note: Expenditures include direct labor, equipment, materials and
supplies, travel, other direct costs, subcontracted resources, project
associates, and indirect costs.
[End of table]
NIOSH Established Contract Oversight Procedures That Focused on
Expediting Processing of Claims but Performed Insufficient Oversight of
Contractor Costs:
NIOSH established procedures to monitor overall contract performance
but did not have sufficient procedures in place to monitor ORAU's
costs. To oversee contract performance, NIOSH tooks steps such as
reviewing the contractors' monthly progress reports, conducting
quarterly assessments through its Contract Oversight Team, and holding
weekly meetings with contractor staff. NIOSH also reviewed ORAU's
requests for additional funding to ensure they were adequately
justified and documented. In some cases, NIOSH questioned the
contractor's basis for additional funding and requested additional
documentation to sufficiently quantify labor requirements for some of
the individual tasks under the contract. For example, NIOSH was
concerned that ORAU's staffing levels and the ratio of managers to
staff were higher for some tasks than what was needed to complete
essential activities. It subsequently approved the additional funding
requested after obtaining further justification from ORAU. In other
cases, NIOSH approved a slightly lower amount than what was requested
because it believed, for example, that the membership cost in a
professional organization was not directly billable to the contract.
The type of contract used for ORAU was an award fee contract. NIOSH
exercised oversight of contractor performance, in part, through
semiannual award fee evaluations in which ORAU's performance was
measured against certain evaluation criteria. Through contract
modification, these criteria were periodically modified to target key
areas for improvement. For example, criteria for the first evaluation
period included start-up activities in contrast to later award periods
that focused on other priorities, such as efficient processing of the
backlog of oldest claims. While periodic adjustments to the award fee
criteria were made, overall NIOSH held the contractor accountable for
technical performance and management, which primarily encompassed dose
reconstruction claims processing. These criteria were worth 85 out of
100 points.[Footnote 17] NIOSH's program director told us that the
agency put a premium on productivity in light of intense pressure from
the claimant and congressional community to process claims quickly. The
remaining 15 points were allocated to business and cost management.
NIOSH and ORAU made various mid-course adjustments to expedite claims
processing through such steps as systematically developing site
profiles and "workbooks" that automated dose reconstruction
calculations and hiring a new ORAU project director whose priority was
to accelerate claims processing. As a result of these efforts, the
volume of dose reconstructions increased considerably after the first
few years and generally leveled off as ORAU began processing the
backlog of the oldest, most difficult claims. However, the average 6-
month performance remained short of NIOSH's goal for the number of dose
reconstructions produced per month for all but the most recent
evaluation period. (See fig. 3.) NIOSH's initial goal was 800 dose
reconstructions per month, but was adjusted down to 640 per month and
then later in the contract period to 320 per month as the number of
dose reconstructions remaining to be completed declined. NIOSH
officials told us that the initial target was established somewhat
arbitrarily because, at the time, the project had essentially no
experience with producing dose reconstructions and that the goal was
adjusted as NIOSH and the contractor gained a better understanding of
the program.
Figure 3: Trends in ORAU's Average Monthly Dose Reconstruction
Production, March 2003 through June 2007:
This figure is a bar chart showing trends in ORAU's average monthly
dose reconstruction production, March 2003 through June 2007.
[See PDF for image]
Source: GAO analysis of NIOSH data.
Note: The last period reflects a 4-month average through June 2007,
which was the most recent data available.
[End of figure]
Despite the emphasis on expediting dose reconstructions, ORAU's
performance evaluations showed a mixed track record for delivering
accurate products on time, and typically resulted in "average" ratings
for the contractor, as shown in table 3. ORAU got off to a difficult
start, and its very first evaluation from September 2002 to March 2003
noted that the contractor did not produce any dose reconstructions of
sufficient quality and that management failed to add staff in order to
meet agreed upon dose reconstruction targets. Subsequent evaluations
noted that while ORAU had made substantial progress in reducing the
backlog of cases, it still needed to improve efficiency in producing
dose reconstructions, which should have resulted in a steady increase
in number of claims processed despite the fact that the backlog
consisted of older, more complex cases. ORAU's performance gradually
improved and the contractor subsequently received ratings of excellent
in the two most recent periods due, in part, to sustaining a high level
of dose reconstruction production and responding to advisory board
reviews.
Table 3: Award Fee Performance Evaluations for ORAU:
Six-month period: Sept. 2002-Mar. 2003;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Average.
Six-month period: Mar. 2003-Sept. 2003;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Average.
Six-month period: Sept. 2003-Mar. 2004;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Average.
Six-month period: Mar. 2004-Sept. 2004;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Very good.
Six-month period: Sept. 2004-Mar. 2005;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Average.
Six-month period: Mar. 2005-Sept. 2005;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Average.
Six-month period: Sept. 2005-Mar. 2006;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Very good.
Six-month period: Mar. 2006-Sept. 2006;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Excellent.
Six-month period: Sept. 2006-Mar. 2007;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): Excellent.
Six-month period: Mar. 2007-Sept. 2007;
Rating (on a scale of excellent, very good, average, marginal,
unacceptable): To be determined upon contract completion.
Source: GAO analysis of NIOSH information.
[End of table]
To further accelerate claims processing, NIOSH redirected a portion of
ORAU's work to a second contractor, Battelle. While ORAU focused on
Energy sites, Battelle was assigned to handle dose reconstructions for
1,447 of the oldest claims from 256 Atomic Weapons Employer
sites.[Footnote 18] The Battelle task order was for 1 year at a total
cost of $2.9 million.[Footnote 19] As with the ORAU contract,
Battelle's initial progress was slow as it established the necessary
infrastructure such as creating dose reconstruction methods and quality
assurance procedures. In addition, dealing with large volumes of often
illegible monitoring records was more complex and took longer than
expected. As a result, Battelle fell 6 months behind schedule and the
task order was extended through May 2007 but at no additional cost to
the government.[Footnote 20] To evaluate Battelle's ongoing
performance, NIOSH conducted informal oversight through weekly meetings
and reviewing monthly progress reports. In a formal evaluation after
the task order expired, Battelle received 16 out of 20 available points
for quality, value, timeliness, and business relations, and NIOSH noted
that Battelle had completed all required work.
While NIOSH had procedures in place to monitor overall contract
performance, the program and contracting offices' procedures to monitor
ORAU's costs were insufficient. Primary responsibility for contract
management rests with the contracting officer in the Procurement and
Grants Office within the Centers for Disease Control and Prevention
(CDC). The contracting officer is responsible for overall contract
administration and ensuring compliance with all terms of the contract.
The contracting officer is assisted by personnel in the program office
who perform such duties as monitoring contractor performance, reviewing
invoices and vouchers, and recommending approval or disapproval actions
to be taken by the contracting officer. However, officials from the
program and contracting offices told us that they performed limited
reviews of ORAU invoices. For example, ORAU's monthly invoices were
compared with its monthly progress reports to identify potential
anomalies. However, the program and contracting offices did not have
sufficient policies and procedures for reviewing and approving the
invoices to determine whether costs billed to the government were
allowable, reasonable, and allocable. Because cost reimbursement
contracts place the maximum risk with the government and provide the
contractor with little financial incentive to control costs, the
Federal Acquisition Regulation (FAR) requires that appropriate
contractor surveillance be implemented by the agency when such
contracts are used in order to provide reasonable assurance that
efficient methods and effective cost controls are used. Furthermore,
ORAU's invoices did not contain the appropriate level of detail nor
supporting documentation needed to determine the allowability of costs,
according to the project officer for the ORAU contract and the
contracting specialist. For example, ORAU's invoices did not provide
hours worked and labor rates by employee or provide support for travel
costs. As such, the lack of detail on the invoices could hinder NIOSH's
ability to identify potentially improper charges based on the invoices
alone. The contracting specialist told us that new CDC guidelines dated
March 2006 require contractors to submit a detailed breakout of labor
rates and charges by employee, and that the requirement would take
effect with the next dose reconstruction contract to be awarded
following expiration of the ORAU contract in September 2007.
NIOSH also did not have sufficient policies and procedures in place
with regard to ORAU's oversight of subcontractor costs, which
constituted 66 percent of ORAU's initial cost proposal. While we
recognize that under the FAR, the government's direct contracting
relationship is with the prime contractor, the need for a process in
place to ensure the prime contractor is providing adequate oversight
and effective cost control of its subcontractors' expenditures is even
more pronounced when both entities' contracts are cost reimbursement.
Instead, NIOSH relied primarily on ORAU to review and validate
subcontractor charges without having an adequate process in place to
assess whether ORAU was properly carrying out this responsibility.
NIOSH also relied on the Defense Contract Audit Agency's (DCAA) reviews
of corporate wide accounting systems for ORAU and its subcontractors
for assurance that charges billed were proper. While external reviews
such as DCAA's can supplement an overall system of internal control,
they are not a substitute for them and do not provide NIOSH with
assurance that the amounts billed were allowable. Additionally, NIOSH
relied on DCAA audits of ORAU's incurred costs to determine whether
direct and indirect costs were allowable. While such audits--which can
occur years after the government reimbursed the contractor--do
determine the allowability of invoice amounts, they do not take the
place of preventive controls, such as invoice review procedures, that
the agency needs to ensure that only allowable costs are reimbursed.
For example, the last DCAA incurred cost audit was performed in March
2007 for costs billed to the government in 2003. While the audit showed
that direct and indirect costs were acceptable, costs billed since then
have not yet been audited.
NIOSH's Cost Estimate for Next Dose Reconstruction Contract Is Based on
Historical Data:
ORAU's 5-year contract was set to expire in September 2007, and NIOSH
has already issued a request for proposal for a new dose reconstruction
contract, expected to be awarded shortly thereafter.[Footnote 21] The
new contract will remain a cost plus award fee contract because NIOSH
officials told us it is very difficult to predict the amount of effort
that will be required to accomplish the contract objectives, given
outside influences such as advisory board reviews. However, the new
contract will be an option year contract--the first year is a base year
followed by 4 option years. Thus, the contract could be terminated at
any time after the first year or be extended for up to 4 additional
years.
NIOSH officials believe that the government's cost estimate for the new
contract is more realistic compared to the first contract because it is
based on historical data. For example, NIOSH expects that site research
would be mostly completed during the first contract, so it estimated
little cost for those activities. By contrast, NIOSH anticipated that
SEC activities would continue at the same pace during the new contract,
and estimated costs for that activity accordingly. In addition, we
found that the new request for proposal contains a more clearly defined
scope of work than the first proposal. However, the extent of any
future cost growth remains to be seen.
NIOSH Has Issued a Conflict of Interest Policy and Implemented Most
Provisions after Some Delay, but Is Not Yet Monitoring or Enforcing the
Policy:
NIOSH issued a comprehensive conflict of interest policy addressing all
aspects of the dose reconstruction program, covering different types of
conflicts of interest--individual, corporate, financial, and other
relationships--and pertaining to a wide range of entities, including
federal and contractor employees. The policy is important because there
is a limited pool of experts-many of them former Energy employees-who
can produce dose reconstruction reports, site profiles, and SEC
petition evaluations. Therefore, the input of such experts must be
carefully managed to ensure these key documents are accurate. While
most policy provisions have been carried out, implementation was
delayed for certain provisions such as filing disclosure forms because
the forms were too cumbersome to be filed as specified by the policy.
In addition, NIOSH is not yet fully monitoring or enforcing the policy,
although it has appointed a conflict of interest officer. For example,
NIOSH has not yet audited conflict of interest disclosure forms or
imposed penalties for any missing, erroneous, or incomplete forms.
Policy Addresses All Aspects of Dose Reconstruction Program and Covers
a Wide Range of Entities:
Having a conflict of interest policy is important to protecting program
integrity, particularly since the government is charged with
administering the dose reconstruction program and adjudicating claims.
There is a limited pool of experts with the knowledge needed to perform
the work, and not surprisingly, many of these experts worked for the
Department of Energy in the past. Some of the experts working in this
program have had previous involvement at Energy facilities where
workers were exposed to radiation and were, in fact, hired for their
extensive knowledge of these facilities. NIOSH therefore must carefully
balance the need to obtain all relevant information about Energy's
sites by involving experts who are familiar with the sites while
ensuring that scientific judgments that affect claimants' eligibility
for benefits are made in an unbiased manner.
NIOSH issued its first conflict of interest policy for this program on
October 17, 2006, and vetted the policy with the advisory board before
finalizing it.[Footnote 22] NIOSH officials stated that the new policy
was precipitated in part by a claimant advocate's allegation that a
subject expert who authored a site profile used information they had
previously developed while working at that site, and that the author's
bias toward their own previous work resulted in incorrect data, leading
to an underestimate of the radiation dose. ORAU's policy at the time
was ambiguous about how much input such experts could provide to a
document and, further, did not have specific rules requiring experts to
disclose any conflicts of interest. NIOSH officials told us that they
developed a policy in 2006 that would allow knowledgeable individuals
to contribute their expertise---particularly since their numbers are
limited--but avoid conflicts of interest. The policy prohibits
employees with any sort of potential, actual, or perceived conflict
from taking a lead role on technical documents, SEC petition
evaluations, or individual dose reconstructions. The NIOSH policy
addresses different types of conflict of interest--individual,
corporate, financial, employment-related, familial, and supervisor-
subordinate relationships. However, in the interest of making sure that
all available factual information about radiation doses is gathered
from all relevant sources and considered, experts who have a perceived
or actual conflict of interest with a site are still permitted to
contribute to site profiles and SEC petition evaluations for that site,
as needed, to ensure their completeness and accuracy. However, the
policy requires that their specific contributions be fully noted.
The NIOSH policy is comprehensive in that it addresses all aspects of
the dose reconstruction program, as well as corporate entities and all
federal, contractor, and subcontractor employees associated with the
dose reconstruction program.[Footnote 23] As such, the policy applies
not only to those who directly perform key program functions, but also
to those who serve in ancillary roles such as administrators, support
staff, and attorneys.[Footnote 24]
While Most Provisions Are Now Implemented, NIOSH Is Not Yet Fully
Monitoring or Enforcing Its Policy:
NIOSH and its two principal contractors for the dose reconstruction
program--ORAU and Battelle--have implemented most applicable policy
provisions, including prohibiting individuals with an actual or
perceived conflict from performing dose reconstructions or authoring
site profiles and disclosing narrative and quantitative input by site
and subject experts to technical documents (see table 4). For example,
ORAU uses a database tracking system to automatically prevent the
assignment of dose reconstruction claims to staff that have a conflict
with the particular site under review. In addition, site and subject
experts who contributed to technical documents are clearly identified
and their input has been attributed to them in order to fully disclose
the source of the information. Moreover, ORAU went beyond what the
policy requires by retroactively annotating and attributing technical
documents to their source to provide the basis of each finding,
conclusion, and other information in the document.
Table 4: Implementation Status of Key Conflict of Interest Policy
Provisions:
Provision: Dose reconstructions, technical documents, and SEC petition
evaluations: Individuals with a conflict cannot perform dose
reconstructions or author technical documents and SEC petition
evaluations for sites at which they have a conflict;
NIOSH: fully implemented;
ORAU: fully implemented;
Battelle: fully implemented.
Provision: Site and subject experts: All input to documents is
attributed to each source;
NIOSH: fully implemented;
ORAU: fully implemented;
Battelle: fully implemented.
Provision: Site and subject experts: Experts are identified on the
approval page of technical documents;
NIOSH: fully implemented;
ORAU: fully implemented;
Battelle: fully implemented.
Provision: Public disclosure forms: Individual and corporate entities
complete a disclosure form when first assigned to a program
function[A];
NIOSH: fully implemented[D];
ORAU: fully implemented[D];
Battelle: fully implemented[D].
Provision: Public disclosure forms: Electronic copies of disclosure
forms are publicly available on the Web within 1 day of completion;
NIOSH: fully implemented[D];
ORAU: fully implemented[D];
Battelle: fully implemented[D].
Provision: Procedures demonstrating compliance: Procedures
demonstrating compliance are posted on the Web within 60 days of final
publication of the policy;
NIOSH: fully implemented[D];
ORAU: fully implemented[D];
Battelle: n/a[B].
Provision: Procedures demonstrating compliance: Entity's employees are
informed of the policy and implementing procedures;
NIOSH: fully implemented;
ORAU: fully implemented;
Battelle: n/a[B].
Provision: Monitoring and enforcement: NIOSH conflict of interest
officer reviews disclosure forms, ensures key program documents conform
to policy, and investigates and resolves complaints;
NIOSH: partially implemented;
ORAU: n/a;
Battelle: n/a.
Provision: Monitoring and enforcement: NIOSH will audit disclosure
forms periodically;
NIOSH: not yet implemented;
ORAU: n/a;
Battelle: n/a.
Provision: Monitoring and enforcement: Any errors in disclosure forms
as a result of NIOSH's audit will be corrected immediately and
penalties imposed for failure to comply;
NIOSH: not yet implemented;
ORAU: n/a;
Battelle: n/a[B].
Provision: Monitoring and enforcement: Anyone may submit complaint to
NIOSH regarding missing or erroneous disclosure forms by contacting
NIOSH conflict of interest officer[C];
NIOSH: fully implemented;
ORAU: n/a;
Battelle: n/a.
Provision: Monitoring and enforcement: Policy incorporated as a
contract provision and tracked as a deliverable;
NIOSH: fully implemented;
ORAU: n/a;
Battelle: n/a.
Source: GAO analysis of NIOSH conflict of interest policy and actions
taken to implement its provisions.
[A] A modified version of this provision may be implemented, allowing a
new disclosure form to be filed each time an individual's association
with a site changes.
[B] Not applicable given pending expiration of Battelle task order when
policy was issued.
[C] No complaints had been filed as of May 2007, according to the
conflict of interest officer.
[D] Delayed implementation.
[End of table]
However, implementation of some provisions was delayed. For example,
NIOSH and its contractors were required to file disclosure forms
whenever an individual was assigned to a new or different task.
However, the implementation of this provision was delayed because NIOSH
and contractor officials found it cumbersome to file the forms that
often, and NIOSH decided to allow individuals to file disclosure forms
only when there were changes in the particular sites with which they
had a conflict. Ensuing delays in filing disclosure forms led to delays
in posting procedures demonstrating compliance with the policy on the
organizations' Web sites.
These delays have, in part, hindered NIOSH from fully monitoring and
enforcing its policy, meaning that the NIOSH-appointed conflict of
interest officer has only just begun a review of all disclosure forms
and key program documents to ensure they conform to the
policy.[Footnote 25] NIOSH officials told us that the review will be
completed once NIOSH has developed a Web-based tool that will match the
document author with its disclosure form, but officials did not
indicate when the tool would be ready. While NIOSH is also required to
periodically audit completed disclosure forms, it has not yet developed
audit procedures or a timetable for fulfilling this requirement, nor
has NIOSH imposed penalties for any missing, erroneous, or incomplete
forms.
Labor's Reviews of NIOSH Documents and Returns of Cases for Rework Do
Not Indicate Systematic Efforts to Contain Benefits, but Raise Issues
about the Transparency of Labor's Involvement:
While Labor did not pursue a strategy to deny benefits to eligible
claimants, the agency was extensively involved in commenting on NIOSH's
scientific work and did not transparently provide its rationale for
certain comments on NIOSH technical documents or SEC petition
evaluations. Labor officials told us that, as the lead agency, Labor
reviews NIOSH documents to promote their clarity and consistency so
that Labor can better adjudicate claims. We estimated that 65 percent
of the technical documents contained comments pertaining to clarity and
consistency or contained no comments at all, but in some instances,
Labor's comments appeared to go further and questioned NIOSH's
scientific assumptions. It was difficult to determine, from the written
documents alone, how these particular comments pertained to Labor's
adjudication role because the agency did not explicitly document its
rationale. Labor officials subsequently met with us and explained how
these comments did in fact relate to the adjudication of claims.
However, we remain concerned that this lack of transparency in Labor's
written comments could give the appearance of an effort to deny
benefits to eligible claimants. Apart from commenting on NIOSH
documents, Labor also returned nearly 3,000 cases to NIOSH for rework.
Of returned cases, 87 percent of them had a less than 50 percent
probability of causation, based on NIOSH's initial dose reconstruction,
and thus would likely have been denied compensation. Of these cases, 16
percent were subsequently awarded benefits. The remaining cases that
Labor returned had a 50 percent or greater probability of causation and
thus would likely have been awarded benefits based on the initial dose
reconstruction. However, 11 percent of these cases were denied
following rework.
Labor's Comments on NIOSH's Documents Focused on Clarity and
Consistency, but Rationale for Comments That Questioned NIOSH's Science
Lacked Transparency:
Labor's extensive comments on NIOSH's documents were intended to
promote the clarity and consistency of these documents, but the
rationale for questioning some scientific assumptions and SEC
definitions was not always explicit. While the law and regulations do
not provide guidance on Labor's authority to comment on NIOSH draft
technical documents and SEC petition evaluations, both NIOSH and Labor
acknowledged the value of Labor's comments in helping facilitate the
adjudication of claims. Labor makes compensation decisions based on
NIOSH's radiation estimates for individual claimants but has no
explicit authority to comment on the underlying technical documents on
which the estimates are based. Labor officials told us, however, that
they reviewed these technical documents--as well as SEC petition
evaluations--because the executive order implementing EEOICPA gives
Labor, as lead agency, broad authority to administer the
program.[Footnote 26] At Labor's request, NIOSH agreed, in January
2006, to systematically submit certain draft documents to Labor for
review and comment. These included the three types of technical
documents used in dose reconstruction--site profiles, technical
information bulletins, and technical basis documents--and SEC petition
evaluations, as shown in table 5. Labor officials told us that they
offer comments intended to facilitate adjudication of claims by
highlighting needed improvements to the clarity and consistency of
NIOSH's documents, and acknowledged that all comments are to be taken
at NIOSH's discretion.
Table 5: Types of NIOSH Documents Reviewed by Labor:
Technical document used in dose reconstruction;
NIOSH document: Site profile;
Description: Describes a specific work site. Details factors such as
the physical appearance and layout of the work site, the work processes
used there, the types of materials used and potential sources of
radiation.
Technical document used in dose reconstruction;
NIOSH document: Technical basis document;
Description: Individual documents that form a site profile. An
individual document contains information on a specific aspect of the
work site, such as the physical layout of the work site or the work
processes used.
Technical document used in dose reconstruction;
NIOSH document: Technical information bulletin;
Description: Documents containing information on specific technical
issues or procedures for estimating radiation exposure, used to add to
or supplement technical basis documents and site profiles and may be
used for specific or multiple work sites.
SEC petition evaluation;
NIOSH document: [Empty];
Description: Evaluation of requests filed by claimants seeking the
addition of new classes of employees to the special exposure cohort.
Source: NIOSH.
Note: NIOSH considers SEC petition evaluations to be a type of
technical document. However, unlike site profiles, technical basis
documents, and technical information bulletins, SEC petition
evaluations are not used in the dose reconstruction process.
[End of table]
Labor commented extensively on the three types of technical documents
used in dose reconstruction and on SEC petition evaluations, and the
majority of their comments were clearly related to facilitating the
adjudication of claims. We reviewed Labor's comments for a random
sample of 79 technical documents from the 187 documents upon which
Labor provided comments as of March 31, 2007. On the basis of this
sample, we estimate that 65 percent of the technical documents
contained only comments that dealt with making the documents clear and
consistent, or contained no comments at all from Labor. Eleven percent
of technical documents contained comments pertaining to NIOSH's
scientific processes, assumptions, or conclusions.[Footnote 27] These
results are summarized in table 6. We also reviewed Labor's comments on
the 6 draft SEC petition evaluations on which Labor provided
substantive written comments. Likewise, Labor's comments on some SEC
petition evaluations sought to clarify the definition of workers and
facilities that were being proposed for inclusion in the SEC, and Labor
officials told us that they did not make any recommendations to approve
or deny the petition.[Footnote 28] (See app. II for a listing of SEC
petition evaluations and indication of whether Labor provided
comments.)
Table 6: Estimated Percent of NIOSH's Draft Technical Documents, by
Nature of Labor's Comments:
Type of comment: Clarity, consistency, or no comment;
Estimated percentage of Technical documents: 65.
Type of comment: Accuracy;
Estimated percentage of Technical documents: 19.
Type of comment: Minor editorial change;
Estimated percentage of Technical documents: 13.
Type of comment: Scientific processes, assumptions, or conclusions;
Estimated percentage of Technical documents: 11.
Type of comment: Tone;
Estimated percentage of Technical documents: 11.
Type of comment: Comment agrees with NIOSH language;
Estimated percentage of Technical documents: 1.
Source: GAO analysis of Labor's comments on a sample of NIOSH draft
technical documents.
Note: Percentages do not sum to 100 because Labor may have provided
more than one type of comment for a technical document.
[End of table]
We found, however, that other comments appeared to go beyond clarity
and consistency. Moreover, it was not always clear without considerable
verbal explanation from Labor as to how the comments related to clarity
and consistency and would facilitate the adjudication of claims. An
estimated 11 percent of the technical documents contained comments that
questioned NIOSH's scientific assumptions. In addition, comments on
several SEC petition evaluations suggested that the SEC definition was
too broad and that the size of the cohort should therefore be reduced.
It was difficult to determine, from the written documents alone, how
these particular comments were related to Labor's adjudication role---
as opposed to NIOSH's scientific role---because Labor did not
explicitly document its rationale. Instead, it was necessary for Labor
officials to walk us through each document and provide the additional
context needed to understand how the comments were linked to
adjudication. For example, in a technical information bulletin on
construction workers, Labor's written comment suggested that NIOSH was
being overly favorable toward claimants by taking information derived
from a group of monitored workers at a particular Energy site and using
it to estimate radiation doses for certain unmonitored workers at other
sites. Specifically, Labor asked, "Could this not upwardly bias the
assumed average annual dose to unmonitored subcontractor construction
workers?" On its surface, this comment might be interpreted as an
attempt to reduce the likelihood of certain claimants receiving
compensation. However, Labor explained to us that the agency sought
clarification of NIOSH's scientific assumptions and that this
clarification was needed to adjudicate cases where claimants might have
objected to their dose reconstruction being based on data from a site
at which they had never worked. While Labor was eventually able to
demonstrate how its comments on technical documents and SEC petition
evaluations were tied to adjudication, we remain concerned that Labor's
lack of transparency in giving its rationale when it made the comments
to NIOSH could give the appearance of an effort to deny benefits to
eligible claimants.
Data on Cases That Labor Returned to NIOSH for Rework Did Not Reflect
Systematic Attempt to Deny Benefits:
As contemplated by EEOICPA regulations, Labor may return cases to NIOSH
for rework for any reason, as part of the adjudication process. As of
March 2007, Labor had returned nearly 3,000 cases for rework, and the
data we reviewed did not indicate a systematic strategy by Labor to
deny benefits to claimants.[Footnote 29] Were Labor pursuing such a
strategy, the agency could have requested that NIOSH rework primarily
those cases that would have been approved so that the likelihood of
employment-caused cancer could be reduced and the case ultimately
denied. However, our analysis of Labor statistics on these cases showed
that the vast majority (87 percent) of cases returned to NIOSH for
rework had a less than 50 percent probability of causation, based on
NIOSH's initial dose reconstruction, and thus would likely have been
denied compensation, as shown in fig. 4. The most common reason for
returning a case was that information originally sent to NIOSH had
subsequently changed, such as the presence of an additional type of
cancer or a longer term of employment at a nuclear facility. Also, a
greater percentage of cases were reversed in the claimant's favor
following rework, with 16 percent of denied cases switching to
approvals, compared to 11 percent of approved cases switching to
denials.
Figure 4: Summary of Cases Returned to NIOSH for Rework, as of March
31, 2007:
This figure is an illustration showing a summary of cases returned to
NIOSH for rework, as of March 31, 2007:
[See PDF for image]
Source: GAO analysis of Department of Labor data.
[End of figure]
Several Issues Present Challenges to Advisory Board's Independence, and
Various Options Could Be Considered to Address Them:
While we did not find evidence that the advisory board was impeded in
performing its statutory responsibilities, issues pertaining to the
board's funding structure, member appointment process, and support
staff present challenges to independence, leaving the board vulnerable
to potential outside influence. Various options are available to
address these challenges, such as appropriating funds directly to HHS
in a separate line item specifically for the advisory board, including
Congress on a bipartisan basis in the appointment of advisory board
members, and requiring HHS to develop procedures to ensure that the
advisory board will not be inappropriately influenced. These options
have various advantages and disadvantages.
Issues Related to Advisory Board Funding, Membership, and Support Staff
May Challenge Board Independence:
The advisory board does not receive direct appropriations, and instead,
its funds pass through Labor and HHS. While Labor was authorized to
transfer necessary funds to NIOSH in fiscal years 2001 to 2005, no
specific line item funding was authorized for the board's
operations.[Footnote 30] In contrast, Labor's 2006 appropriations act
directed the Secretary of Labor to transfer $4.5 million to NIOSH for
use by or in support of the advisory board. No change was made to that
provision in the 2007 continuing resolution. While advisory board
members report having received necessary funding to date, the absence
of a specified amount reserved exclusively for the board's operations
could pose a future challenge to the advisory board's independence and
credibility because the agencies have a potential opportunity to limit
the board's budget if they disapprove of the board's actions on such
issues as the quality and validity of NIOSH's dose reconstructions and
recommendations on adding classes of workers to the SEC.
The process by which board members are appointed is also not clearly
established or uniform, presenting a challenge to the advisory board's
independence. EEOICPA requires the President to appoint board members,
in consultation with organizations having expertise on worker health
issues, to ensure that members reflect a balance of scientific,
medical, and worker perspectives. However, neither the act nor the
executive order implementing the act specifies criteria for nominating
and selecting board members. While the advisory board is also subject
to the FACA requirement that board membership be balanced, Members of
Congress and the claimant community have raised concerns about
potential influence by Labor and NIOSH to reduce the number of worker
representatives in order to shape the outcome of the board's decisions
on SEC petitions. These concerns were precipitated by internal Labor
correspondence in 2005 that characterized the advisory board as being
essentially a worker advocacy organization and noted that a change in
membership would be critical to counteracting the pressure to add more
classes to the SEC. Five of the 12 board members have been replaced
since the board was established. As of October 2006, only two members
were worker representatives, according to the designated federal
officer, but that number has since grown to four worker
representatives.
The executive order that implements EEOICPA also tasks HHS--of which
NIOSH is a part--with providing support staff and resources to the
advisory board.[Footnote 31] However, there is a potential for key
federal agency officials supporting the board to have conflicts of
interest, presenting another challenge to ensuring advisory board
independence. GAO's prior work showed that certain federal officials
supporting the advisory board in the past may not have been
sufficiently independent.[Footnote 32] For example, the designated
federal officer for the advisory board was also the director of the
NIOSH program being reviewed by the board. In response to concerns
about the appearance of dual roles, the NIOSH Director replaced the
designated federal official with a senior NIOSH official not involved
in the program. However, there is currently nothing in place to ensure
that HHS will avoid similar conflicts of interest in the future as new
candidates are considered for advisory board support roles over the
life of the board. In addition, several advisory board members
expressed concerns to us that HHS general counsel staff may not be
sufficiently independent because they are tasked with providing legal
advice to the advisory board and NIOSH simultaneously. Wearing these
dual hats has, at least on one occasion, prevented HHS general counsel
staff from advising the advisory board on certain legal matters in a
public forum since the matter dealt with ongoing litigation that
involved NIOSH.
Options to Enhance Advisory Board Independence Could Involve
Congressional, Agency, and Advisory Board Action:
We identified various options to enhance advisory board independence by
addressing challenges arising from the advisory board's funding
structure, membership process, and staff support. Table 7 provides an
overview of possible options, how they compare to the current program,
their advantages and disadvantages, and possible models in other
programs. The options presented are independent of each other and could
be implemented in any combination, if at all.
One option is to require that funds be appropriated directly to HHS in
a separate line item specifically for the advisory board.[Footnote 33]
Such a change could more directly route funds to the advisory board and
avoid any potential agency efforts to inappropriately reduce the
advisory board's funding and, in doing so, limit its scope of
activities. Congress funded the advisory board via a separate line item
in fiscal years 2006 and 2007 but did not do so in previous fiscal
years. The Antitrust Modernization Commission is an example of another
FACA committee that was funded via a separate line item.
A second and a third option for increasing the independence of the
advisory board pertain to the appointment of advisory board members.
Option two is to include Congress, on a bipartisan basis, in the
appointment of members to the advisory board.[Footnote 34] This could
reduce the potential for any efforts by any administration to "stack"
the board. However, the option could also have the disadvantage of
lengthening the appointment process. The Veterans' Disability Benefits
Commission is a possible model for this option.[Footnote 35] A third
option is to require that the Administration's nomination and selection
process be publicized and that the public be allowed to have input in
the nomination process. In GAO's prior work on federal advisory
committees, we identified as a best practice the strategy of seeking
nominations from the public by using widely available resources, such
as the Federal Register and agency Web sites, to broaden the pool of
candidates from which committee members may be drawn, as well as
creating a systematic and transparent method of obtaining nominations
that help create a balanced advisory committee.[Footnote 36] Other
research has also noted the salience of making information about the
committee formation and nomination process public in order to "draw
from a wide and diverse base for committee appointments and to ensure
balance in the resulting committee makeup."[Footnote 37] However,
disadvantages of this option may include increased administrative and
publishing costs and a longer nomination process. The Environmental
Protection Agency's (EPA) Science Advisory Board, which advises EPA on
scientific matters, may be a possible model for this option.[Footnote
38]
A fourth option for increasing independence could be for Congress to
require the advisory board to report periodically to the Secretary of
HHS and congressional committees of jurisdiction on whether the
advisory board is encountering any obstacles that may impair its
ability to perform its statutory responsibilities in an independent and
credible manner. For example, the advisory board could be asked to
highlight any obstacles in areas including the adequacy of funding,
access to data, independence of agency support staff, and the balance
of perspectives among board members. The advantage of this option is
that it could provide a mechanism for periodically surfacing any such
issues from the people who would likely have firsthand knowledge of
them. Disadvantages of this option are that it could increase the
advisory board's already substantial workload and it may prove
difficult to reach consensus among board members as to whether they are
actually encountering any obstacles to independence. According to
officials from General Services Administration's Committee Management
Secretariat, whose task it is to monitor and report executive branch
compliance with FACA, there are currently no advisory committees
required to report to Congress on obstructions to their independence.
However, General Services Administration officials were supportive of
the option and noted its potential benefits.
A fifth option would be for HHS to develop procedures to ensure that
federal officials providing staff support to the advisory board remain
independent of NIOSH's dose reconstruction program. While FACA
regulations require that agency heads develop procedures to assure that
advice or recommendations of advisory committees will not be
inappropriately influenced by the appointing authority or any special
interests, HHS has not developed such procedures for the advisory
board. For example, the agency could develop written guidelines to
ensure that officials providing staff support to the advisory board,
such as the designated federal officer or general counsel, are
sufficiently independent of the program under review. Having such
procedures could provide greater transparency about factors that need
to be considered when designating new candidates for these roles over
the life of the advisory board. The Department of Defense developed
such procedures for its many advisory committees, one of which is the
Veterans' Advisory Board for Dose Reconstruction, and could be used as
a possible model for this option.
Table 7: Options to Enhance Advisory Board's Independence:
Description of option;
Funding: Option 1: Congress appropriates funds directly to HHS in a
separate line item for the advisory board.[A];
Appointment of members: Option 2: Include Congress, on bipartisan
basis, in the appointment of members evenly divided among worker,
scientific and medical communities.[A];
Appointment of members: Option 3: Appointing authority clarifies and
publicizes board member nomination and selection process and allows
public to play a role in nominations;
Advisory board report: Option 4: Advisory board reports periodically to
Congress and Secretary of HHS on any obstacles to its independence;
Federal officials: Option 5: HHS develops procedures to ensure that
federal officials providing staff support to the board are independent.
Current program;
Funding: Option 1: Funding passes through Labor and HHS;
funding was a separate line item for first time in fiscal years 2006
and 2007;
Appointment of members: Option 2: Members are appointed by President;
no requirement to appoint a specific number of representatives from
each community;
Appointment of members: Option 3: Unclear how members are nominated and
selected;
no opportunity for public to nominate candidates;
Advisory board report: Option 4: No such required mechanism for
reporting concerns;
Federal officials: Option 5: No such procedures.
Advantages of option;
Funding: Option 1: Protects board's scope of work and actions from
potential influence by Labor and HHS. Overall administrative costs
reduced;
Appointment of members: Option 2: Increases board's credibility by
promoting greater balance in perspectives;
balance ensured by stipulating number of members from each community;
Appointment of members: Option 3: Provides greater transparency and
understanding of membership process;
conflicts of interest identified prior to member selection;
broader pool of qualified candidates;
Advisory board report: Option 4: Provides a regular mechanism for
advisory board to report on its ability to carry out its work in an
independent and credible fashion;
Federal officials: Option 5: Protects board's independence by helping
ensuring federal officials providing staff support to the board are
free of conflicts.
Disadvantages of option;
Funding: Option 1: Appropriated sum might not guarantee sufficient
funding for advisory board;
Appointment of members: Option 2: May extend the time required to
nominate and select new members;
Appointment of members: Option 3: Additional administrative and
publishing costs;
longer nomination process;
potential negative public reaction if publicly-nominated candidates are
not selected;
Advisory board report: Option 4: May increase board's already
significant workload;
members may have difficulty reaching consensus on whether board
independence is being impeded;
Federal officials: Option 5: May be difficult to obtain staff
knowledgeable yet independent of the program.
Possible models for option;
Funding: Option 1: Antitrust Modernization Commission;
Appointment of members: Option 2: Veterans' Disability Benefits
Commission;
Appointment of members: Option 3: EPA's Science Advisory Board;
Advisory board report: Option 4: None identified by federal officials
responsible for FACA oversight;
Federal officials: Option 5: Veterans' Advisory Board for Dose
Reconstruction.
Source: GAO analysis.
[A] A similar option is proposed in pending legislation (H.R. 268).
[End of table]
Conclusions:
Much progress has been made since EEOICPA's enactment in developing and
implementing the Subtitle B dose reconstruction program. NIOSH has
expedited dose reconstructions with a focus on eliminating the backlog
of the oldest claims. In addition, the advisory board has recommended
the addition of 16 new classes to the special exposure cohort. For its
part, Labor has approved compensation for over 17,000 cases totaling
more than $2.1 billion in benefit payments.
However, the program could be further strengthened in several ways.
NIOSH's oversight of contractor billings in the dose reconstruction
program did not have the level of internal controls to be expected of a
project of this magnitude and complexity. Further, NIOSH's oversight of
ORAU's review of subcontractor costs was not commensurate with the
significant proportion of work they performed. Given that the next dose
reconstruction contract will also be a cost reimbursement contract, it
is therefore critical that NIOSH establish policies and procedures that
will provide reasonable assurance of the appropriateness of contractor
costs. While ORAU's monthly invoices did not contain sufficient detail
to permit NIOSH to validate billings, the next contract will require
the contractor to submit a detailed breakdown of labor rates and
charges. This is a positive first step toward improving oversight of
contractor payments, and NIOSH management's continued attention to this
area will be critical to establishing a lasting and more effective
administration of future dose reconstruction contracts.
Both Labor and NIOSH officials have acknowledged that Labor's provision
of comments on various NIOSH draft documents is useful in facilitating
the adjudication of claims, but without greater transparency, the
agency will not be able to counter the perception that it is attempting
to deny benefits to claimants. Our review of Labor's comments and
analysis of data on cases it returned for rework indicated that Labor
is not pursuing a strategy to deny benefits, and further, that its
comments and involvement are helpful in adjudicating claims fairly.
However, it required a detailed explanation on the part of Labor, to
demonstrate that its comments were all related to facilitating
adjudication, and that it had not attempted to infringe upon NIOSH's
role in the scientific aspects of the process. In the wake of the OMB
memorandum, claimants and Members of Congress are understandably
concerned about whether certain federal agencies are taking actions
behind the scenes to inappropriately deny benefits. Given that this
program is under considerable scrutiny and that the claimants involved
have serious illnesses and are looking for fair and equitable
consideration of their claims, the transparency and credibility of the
Subtitle B dose reconstruction program are paramount. Continued
monitoring of this issue, as well as transparency on the part of Labor,
is important to ensuring program credibility and allowing for
congressional oversight.
The advisory board performs critical functions in the Subtitle B
program and operates in a technically complex and high-pressure
environment with input from multiple stakeholders, including claimants,
Members of Congress, federal agency officials, and others. Board
independence is essential to ensuring that the work of the board will
have credibility. The board faces continuing vulnerabilities with
regard to its needs for funding and staff support and the appointment
of new members to ensure a balance of perspectives. To some extent
these vulnerabilities are inherent to advisory committees in general,
but in this case the vulnerabilities have been exacerbated by
Administration concerns, surfaced in the OMB memorandum, about the need
to develop cost containment strategies for the Subtitle B program.
Hence, continuing diligence is needed in assessing the situation in
which the board performs its work and considering the need for any
adjustments to further promote the board's independence.
Recommendations for Executive Action:
To strengthen NIOSH's oversight of costs incurred in the dose
reconstruction program and improve NIOSH's review and approval process
for contractor billings, we recommend that the Secretary of Health and
Human Services direct the Director of CDC's Procurement and Grants
Office to:
* Establish appropriate policies and procedures for effective review
and approval of the prime contractor's invoices. Such policies and
procedures should specify the steps to be performed for review and
approval, the individuals responsible for carrying out these steps, the
level of invoice detail needed to perform an appropriate review, and
the appropriate documentation to be maintained of that review process.
* Establish a policy and procedures to periodically assess the prime
contractor's oversight of subcontractor costs to determine if there are
any deficiencies and corrective actions needed and assess whether the
controls can be sufficiently relied on to ensure that subcontractor
payments are allowable, reasonable, and in compliance with all FAR and
contract requirements.
To increase transparency and facilitate congressional oversight of
Labor's involvement in NIOSH activities, we recommend that the
Secretary of Labor take steps to ensure that Labor's comments on draft
NIOSH technical documents and SEC petition evaluations more explicitly
indicate how the comments are intended to promote clarity and
consistency, and thereby facilitate Labor's adjudication of claims.
This could include a brief explanation accompanying Labor's comments on
each NIOSH document, that would adequately describe Labor's specific
rationale for its comments.
To further enhance the independence of the President's Advisory Board
on Radiation and Worker Health, we recommend that the Secretary of HHS
implement the agency's regulatory responsibility under FACA to develop
procedures to ensure that the advisory board's work is not unduly
influenced by the appointing authority or any special interests. These
procedures could include a provision specifying that federal officials
who fill key board support roles must be independent of the dose
reconstruction program.
Matter for Congressional Consideration:
In light of the potential vulnerabilities of the Advisory Board on
Radiation and Worker Health, Congress may wish to consider the options
related to funding, appointment of members, and advisory board
reporting that we have identified to further enhance the independence
of the advisory board.
Agency Comments and Our Evaluation:
We provided a draft of this report to Energy, Labor, and HHS for
review. Comments from the three agencies are reproduced in full in
appendixes III through V. Energy stated that it did not have any
comments on the report. Labor agreed with our findings about its
comments on NIOSH's documents and return of cases for rework. With
regard to our recommendation, Labor stated that it did not anticipate
that there would be a need to explain the reason for its comments on
NIOSH documents given Labor's frequent coordination with NIOSH.
Nevertheless, Labor agreed with our recommendation and noted that it is
now including the rationale and basis for its written comments on NIOSH
documents.
HHS agreed with our two recommendations regarding strengthening
oversight of contract costs. HHS generally agreed with our
recommendation to develop procedures to ensure the advisory board's
work is not unduly influenced by the appointing authority or special
interests. The agency noted that its Federal Advisory Committee
Management Handbook outlines policies and procedures to help ensure
that HHS advisory committees are fairly balanced in their membership.
HHS also stated that in soliciting potential nominees for various HHS
advisory committees, it uses a number of avenues to help ensure a
balance of perspectives, such as notices in professional publications
and the Federal Register. Nonetheless, HHS agreed there is merit to
establishing a more formalized process for identifying and selecting
advisory committee designated federal officers.
With regard to the ORAU contract, HHS disagreed with our
characterization that it "significantly underestimated" the cost of the
contract. HHS noted that, in light of limited prior experience and
understanding of the project's complexity, it purposely selected a cost
reimbursement award fee contract to allow flexibility and management
controls over ORAU's performance. We revised our report to acknowledge
this point. Nonetheless, NIOSH's independent government cost estimate
of $91.3 million for the ORAU contract and the original award amount of
$70.1 million were both considerably lower than the $198.7 million in
total actual costs eventually incurred by the contractor. Therefore, we
did not revise our characterization that total contract costs were
significantly underestimated and, as we recognized in our report, this
was due in large part to unanticipated program complexity.
HHS questioned the accuracy of the figures cited in our report on total
NIOSH administrative costs for dose reconstruction cases, and total
ORAU costs. With regard to the former, NIOSH officials told us in a
subsequent discussion that the figure was overstated because it
included some NIOSH costs for activities outside of performing dose
reconstructions, such as evaluating special exposure cohort petitions
and responding to the advisory board. Accordingly, we revised the
report to adjust the figure on NIOSH administrative costs. HHS also
provided information updated through the end of fiscal year 2007 on
NIOSH's total EEOICPA administrative costs and we incorporated this
information in the report. In addition, HHS pointed out that the figure
in our report on the estimated total cost of the ORAU contract at
completion did not reflect the most current information through the end
of fiscal year 2007. We updated the total ORAU contract cost figure
according to additional documentation obtained from the contracting
office.
Finally, with regard to conflict of interest issues, HHS said that we
incorrectly stated that NIOSH issued its first conflict of interest
policy for this program on October 17, 2006, and noted that an earlier
policy was established by ORAU and incorporated into its contract on
October 8, 2002, as a deliverable under the contract. We revised the
report to make it clear that while ORAU's conflict of interest policy
took effect in 2002 for its staff, NIOSH developed a comprehensive
conflict of interest policy for its own staff and contractors in 2006.
HHS also said that its general counsel staff who advise the program are
organizationally separate from NIOSH and are therefore not subject to
NIOSH's conflict of interest policy for the program. We clarified our
report by citing language contained in NIOSH's conflict of interest
policy for the dose reconstruction program regarding which specific
general counsel staff are covered by the policy.
HHS also provided several technical comments, which we have
incorporated as appropriate.
We will send copies of this report to the Secretaries of Energy, HHS,
and Labor; relevant congressional committees; and other interested
parties and will make copies available to others upon request. In
addition, the report will be available at no charge on GAO's Web site
at [hyperlink, http://www.gao.gov].
A list of related GAO products is included at the end of this report.
If you or your staff have any questions about this report, please
contact me at (202) 512-7215 or at bertonid@gao.gov. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this report. Other contacts and staff
acknowledgments are listed in appendix VI.
Signed by:
Daniel Bertoni:
Director, Education, Workforce, and Income Security Issues:
[End of section]
Appendix I: Scope and Methodology:
To determine the reasons for any increases in costs of the two dose
reconstruction contracts awarded by the National Institute for
Occupational Safety and Health (NIOSH) and determine how effectively
the contracts were managed, we met with contracting officials from the
Centers for Disease Control and Prevention's Procurement and Grants
Office in Pittsburgh, Pennsylvania, and reviewed the contract files for
ORAU and Battelle. As criteria to review internal controls over
payments made to contractors, we used our Standards for Internal
Control in the Federal Government[Footnote 39] and the Federal
Acquisition Regulation. We also analyzed pertinent contract-related
materials, including the contracts, the request for proposal for the
next dose reconstruction contract, external audits of the contractors'
and subcontractors' accounting systems and labor rates, NIOSH's
semiannual award fee performance evaluations, correspondence between
the contracting office and the contractor, and documents submitted by
ORAU: monthly progress reports, requests for cost increases, and
internal audits. Finally, we interviewed officials from NIOSH's Office
of Compensation Analysis and Support (OCAS) and toured its headquarters
in Cincinnati, Ohio, to get a better understanding of procedures and
practices. Similarly, we interviewed contractor officials from ORAU and
toured its offices in Cincinnati, Ohio, and Richland, Washington, to
observe operations. While in Richland, we also met with contractor
officials from Battelle.
To determine the conflict of interest policy for NIOSH and its
contractors, we interviewed the NIOSH Conflict of Interest Officer, the
OCAS Director, and contractor officials. To ascertain the
implementation status of key provisions contained in the policy, we
also reviewed selected documents such as disclosure forms, technical
documents, and agency and contractor procedures. In addition, we
periodically visited the Web sites for OCAS and its contractors to
verify that disclosure forms, implementation procedures, and contact
information for the NIOSH Conflict of Interest Officer had been posted,
as required. While our work was not designed to investigate the merits
of specific allegations of conflicts of interest, we also reviewed
pertinent transcripts of advisory board meetings and interviewed a
claimant advocate who worked for a non-profit organization that
monitors implementation of EEOICPA and was familiar with the evolution
of NIOSH's conflict of interest policy.
To determine the extent of Labor involvement in Subtitle B activities
tasked to NIOSH, we analyzed Labor's comments on draft NIOSH technical
documents used in the dose reconstruction process as well as special
exposure cohort (SEC) petition evaluations. Our population consisted of
draft NIOSH technical documents (site profiles, technical basis
documents, and technical information bulletins) upon which Labor
provided comments as of March 31, 2007. We obtained from Labor a
listing of the 236 of these documents, and after eliminating those
documents where Labor did not raise further questions and was merely
responding to NIOSH's resolution of Labor's original set of comments,
we were left with 187 documents. Due to resource constraints, we were
not able to review all 187 documents. Instead, we reviewed a
probability sample of the documents that would allow us to estimate
characteristics for the entire population of technical documents. Thus,
we selected a random sample of 79 technical documents for review: 5
site profiles, 59 technical basis documents, and 15 technical
information bulletins. On the basis of this random sample, we produced
percentage estimates for the population of 187 technical documents.
Because we followed a probability procedure based on random selections,
our sample is only one of a large number of samples that we might have
drawn. Since each sample could have provided different estimates, we
express our confidence in the precision of our particular sample's
results as a 95 percent confidence interval (e.g., plus or minus 9
percentage points). This is the interval that would contain the actual
population value for 95 percent of the samples we could have drawn. As
a result, we are 95 percent confident that each of the percentage
estimates in this report will be within plus or minus 9 percentage
points of the true values in the study population.
To evaluate the nature of Labor's comments, we categorized and analyzed
the comments according to whether they pertained to issues of clarity,
consistency, accuracy, tone, or minor edits. We also analyzed Labor's
comments to see if they raised questions about the scientific
assumptions contained in the document. SEC petition evaluations were
not included in our sample of technical documents. For these, we
similarly examined the nature of Labor's comments on the 6 petition
evaluations for which Labor indicated it had provided substantive
written comments, as of March 5, 2007. We analyzed the comments to
determine whether the comments, if implemented, would have had the
effect of reducing the magnitude of the proposed cohort of eligible
claimants.
To determine whether Labor was potentially trying to deny benefits paid
to claimants, we analyzed data on the 2,811 cases that Labor returned
to NIOSH for rework according to whether the cases were compensable
before rework, why they were returned for rework, and what was their
final outcome following rework. Our scope included cases that: were
"pre-decisional," meaning a recommended decision had not yet been
issued; had a recommended decision but were still awaiting a final
decision; had a final decision; or were subject to Director's orders to
re-open the case. Results of our analyses of technical documents, SEC
petition evaluations, and cases returned for rework were verified
internally by another auditor.
We performed our review by also analyzing pertinent law and
regulations. In addition, we reviewed documents that Labor and NIOSH
provided in response to several committee and subcommittee requests for
all documents and communication---including agency e-mails, letters,
and other documents--pertaining to the role of these two agencies in
implementing EEOICPA. The requests covered a broad range of topics
including Labor's correspondence with NIOSH, the two NIOSH dose
reconstruction contracts, SEC regulations, the advisory board, and the
contractor assisting the board. Finally, we interviewed key Labor and
NIOSH agency officials to discuss Labor's role in commenting on NIOSH
documents and how those comments were linked to the adjudication
process. We also met with officials in Labor's Seattle District Office
to gain a better understanding of the claims adjudication process.
To determine challenges to advisory board independence and identify
possible options to enhance board independence, we interviewed all 12
current board members, the designated federal officer for the board,
the project manager for the contractor assisting the board, and a
claimant advocate. We also analyzed transcripts from recent hearing
records that included statements from the Director of Labor's Office of
Workers Compensation Programs as well as internal agency communication
provided to this subcommittee. In addition, we reviewed the literature
on federal advisory committees, existing procedures concerning the
board, and pertinent law and regulation. We also identified advantages
and disadvantages that would be relevant for policymakers to consider
in implementing these options. Finally, we attended two meetings of the
advisory board held in Washington, D.C., and Naperville, Illinois.
To determine the costs of administering the Subtitle B program, we
analyzed data from Energy, NIOSH, and Labor. Energy's administrative
costs for fiscal years 2002 and 2003 included costs of processing
requests for records pertaining to the Subtitle D program, which
accounted for about 3 percent of total requests, and the remaining 97
percent of requests were for the Subtitle B program. Because Energy did
not maintain data on the Subtitle B dose reconstruction program prior
to May 2004, we estimated costs by multiplying the number of requests
from Labor and NIOSH for Energy records by the average cost of
processing such requests for the period October 2003 through April
2004. In addition, Labor did not break out administrative costs for the
dose reconstruction program from other Subtitle B costs. However, Labor
officials told us that the agency incurs roughly the same costs to
administer the different types of Subtitle B cases, be they dose
reconstruction cases or others such as beryllium, silicosis, and SEC
cases. On the basis of this assumption, we took total obligations,
subtracted funds that Labor obligated to NIOSH, and divided the result
by the total number of Subtitle B cases filed to arrive at the average
cost per Subtitle B case. We then multiplied average cost per case by
the total number of cases that Labor referred to NIOSH for dose
reconstruction to arrive at total administrative costs. We performed
this calculation for fiscal years 2001 through 2006. In addition, we
analyzed Labor's total expenditures on benefits paid out in the dose
reconstruction program. To assess the reliability of data on
administrative costs and benefits paid, we interviewed agency officials
about data quality control procedures and reviewed relevant
documentation. We determined that the data were sufficiently reliable
for purposes of this report.
We conducted our work from August 2006 to October 2007 in accordance
with generally accepted government auditing standards.
[End of section]
Appendix II: Status of Labor's Comments on Draft Special Exposure
Cohort Petition Evaluations:
Table:
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Allied Chemical Corporation Plant;
Labor provided written comments: Classes of employees added to the SEC:
[Check][A];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Ames Laboratory;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Harshaw Chemical Company;
Labor provided written comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Iowa Ordnance Plant, 1949-1974, Line 1;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Check].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Iowa Ordnance Plant, radiographers, 1948-1949;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Check];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Check];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Linde Ceramics Plant;
Labor provided written comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Los Alamos National Laboratory-RaLa, 1944-1963;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Check].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Mallinckrodt Chemical Works, Destrehan Street
Facility, 1942-1948;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Mallinckrodt Chemical Works, Destrehan Street
Facility, 1949-1957;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Nevada Test Site;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Oak Ridge Institute for Nuclear Studies;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Check].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Pacific Proving Grounds;
Labor provided written comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: S-50 Oak Ridge Thermal Diffusion Plant;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Check].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Y-12 Plant, 1943-1947;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Check];
Labor provided oral comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Check];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Classes of employees
added to the SEC: Y-12 Plant,1948-1957;
Labor provided written comments: Classes of employees added to the SEC:
[Empty];
Labor reviewed but had no written comments: Classes of employees added
to the SEC: [Empty];
Labor provided oral comments: Classes of employees added to the SEC:
[Check];
Labor reviewed but had no oral comments: Classes of employees added to
the SEC: [Empty];
Labor did not review: Classes of employees added to the SEC: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Bethlehem Steel
Company;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Blockson Chemical
Company;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Chapman Valve;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Check].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Dow Chemical
Company;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Feed Materials
Production Center;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Check].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: General Atomics;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Hanford;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Monsanto Chemical
Company;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Nuclear Materials
and Equipment Corporation;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Check].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Rocky Flats Plant;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Check].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Sandia National
Laboratory-Livermore;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: W.R. Grace and
Company;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Check][A];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Empty].
Department of Energy site (as of March 5, 2007): Petitions that have
qualified for evaluation and are still under review: Y-12 Plant, 1951-
1959;
Labor provided written comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no written comments: Petitions that have
qualified for evaluation and are still under review: [Empty];
Labor provided oral comments: Petitions that have qualified for
evaluation and are still under review: [Empty];
Labor reviewed but had no oral comments: Petitions that have qualified
for evaluation and are still under review: [Empty];
Labor did not review: Petitions that have qualified for evaluation and
are still under review: [Check].
Department of Energy site (as of March 5, 2007): Petitions not added to
the SEC: Iowa Ordnance Plant, 1946-1948;
Labor provided written comments: Petitions not added to the SEC:
[Empty];
Labor reviewed but had no written comments: Petitions not added to the
SEC: [Empty];
Labor provided oral comments: Petitions not added to the SEC: [Empty];
Labor reviewed but had no oral comments: Petitions not added to the
SEC: [Empty];
Labor did not review: Petitions not added to the SEC: [Check].
Department of Energy site (as of March 5, 2007): Petitions not added to
the SEC: National Bureau of Standards, Van Ness Street;
Labor provided written comments: Petitions not added to the SEC:
[Check];
Labor reviewed but had no written comments: Petitions not added to the
SEC: [Empty];
Labor provided oral comments: Petitions not added to the SEC: [Empty];
Labor reviewed but had no oral comments: Petitions not added to the
SEC: [Empty];
Labor did not review: Petitions not added to the SEC: [Empty].
Source: NIOSH and Labor.
[A] Labor sent NIOSH a letter noting that it had no comment on the
petition evaluation.
[End of table]
[End of section]
Appendix III: Comments from the Department of Energy:
Department of Energy:
Washington, DC 20585:
October 9, 2007:
Mr. Daniel Bertoni:
Director:
Education, Workforce, and Income Security Issues:
United States Government Accountability Office:
Washington, DC 20548:
Dear Mr. Bertoni:
The Office of Health, Safety and Security (HSS) has completed its
review of the draft Government Accountability Office (GAO) Report; GAO-
08-4, Energy Employees Compensation: Actions to Promote Contract
Oversight, Transparency of Labor's Involvement, and Independence of
Advisory Board Could Strengthen Program. HHS has no comments on the
daft report.
Thank you for allowing us the opportunity to review the draft report.
If there are questions, you may contact Patricia Worthington, Director,
Office of Health and Safety, at (301) 903-5926.
Sincerely,
Signed by:
Glenn S. Podonsky:
Chief Health, Safety and Security Officer:
Office of Health, Safety and Security:
[End of section]
Appendix IV: Comments from the Department of Labor:
U.S. Department of Labor:
October 12, 2007:
Mr. Daniel Bertoni:
Director, Education, Workforce, and:
Income Security Issues:
United States Government Accountability Office:
Washington, D.C. 20548:
Dear Mr. Bertoni:
Thank you for the opportunity to comment on the draft report entitled,
"Energy Employees Compensation: Actions to Promote Contract Oversight,
Transparency of Labor's Involvement, and Independence of Advisory Board
Could Strengthen Program," with respect to the Energy Employees
Occupational Illness Compensation Program Act (EEOICPA). We concur with
your findings that the Department of Labor's (DOL) comments on the
National Institute for Occupational Safety and Health (NIOSH) documents
and DOL's return of EEOICPA claims for rework of NIOSH's dose
reconstructions, were intended to maintain consistent and fair claims
adjudication. GAO found no evidence of a systematic effort by DOL to
deny benefits to claimants because there was none.
As the study found, DOL's returning of NIOSH dose reconstructions has
far more frequently resulted in a tentative denial (a case with an
initial dose reconstruction leading to a probability of causation of
less than 50%) changing to an approval, rather than tentative approvals
changing to denials. As you state, DOL returned 2.445 tentative denials
to NIOSH, and so far 385 have been converted to approvals. Only 13%
(366 cases) of all returns were tentative approvals, and only 41 of
those were ultimately reversed and denied.
The tentative approvals that were reversed had been sent back largely
because DOL had discovered some fundamental error, such as a subsequent
determination that the employee did not work in a qualifying facility
or that the wrong cancer(s) had been used to determine the probability
of causation. To our knowledge. none of the handful of cases that DOL
returned for rework based on a technical question about NIOSH's
application of its methodology has been reversed and denied. In
summary, DOL's review of individual dose reconstructions, as intended,
has overwhelmingly been favorable to the claimant.
When making comments on various NIOSH dose reconstruction guidance
documents and Special Exposure Cohort petition recommendations, DOL was
seeking to assist NIOSH in ensuring that its processes and decisions
would be fair, consistent, and administrable in the claims adjudication
process. DOL has strong interest in this area because we are ultimately
responsible to the claimants for the outcomes of this process. As an
example of the need for clarity, an SEC class definition that does not
clearly identify which employee groups are covered, or does not align
with existing employment records, can significantly slow and 2
complicate the determination as to which persons are or are not
included in the class. DOL's input has been particularly important
given that NIOSH's EEOICPA management and staff had little or no
previous experience with this type of benefit program. As your report
notes, NIOSH has acknowledged the value of DOL's input.
With respect to the transparency of our comments, our staff did not
anticipate that an explanation as to why the comments were being made
would be required. This is because the Department has had to engage in
extensive and ongoing coordination with NIOSH to design and properly
implement the complex interactions between the two Departments required
by EEOICPA. In- depth discussions have been particularly necessary
because the NIOSH staff had no expertise in compensation programs.
Given that frequent coordination with NIOSH, we presumed that the
reasons for our comments, which were provided as internal
communications, would be readily understood by the NIOSH recipients.
Nevertheless, DOL concurs with the GAO findings and recommendations,
and has already implemented the recommendation that DOL's written
comments on NIOSH documents include the rationale and basis for the
comments.
Finally, the Department has been keenly aware from the beginning of the
program that many claimants are elderly and have serious illnesses, and
we have endeavored to get payments out to eligible claimants as quickly
as possible within the confines of the law. We agree with the GAO
conclusion that the transparency and credibility of the Part B dose
reconstruction program ” and indeed of the entire EEOICPA program --
are paramount. Again, we appreciate the GAO finding that there was no
evidence of a systemic effort by DOL to deny benefits to claimants and
will continue our work to ensure that claimants receive fair and
equitable consideration of their claims.
Thank you for the opportunity to comment on this report.
Sincerely,
Signed by:
Victoria A. Lipnic:
[End of section]
[End of section]
Appendix V: Comments from the Department of Health and Human Services:
Department Of Health & Human Services:
Office of the Assistant Secretary for Legislation:
Washington, D.C. 20201:
October 15, 2007:
Mr. Daniel Bertoni:
Director, Education, Workforce, and Income Security Issues:
U.S. Government Accountability Office:
Washington, DC 20548:
Dear Mr. Bertoni:
Enclosed are the Department's comments on the U.S. Government
Accountability Office's (GAO) draft report entitled, "Energy Employees
Compensation: Actions To Promote Contract Oversight, Transparency of
Labor's Involvement, and Independence of Advisory Board Could
Strengthen Program" (GAO-08-4).
The Department appreciates the opportunity to review and comment on
this report before its publication.
Sincerely,
Rebecca Hemarl:
for:
Vincent J. Ventimiglia:
Assistant Secretary for Legislation:
Comments Of The Department Of Health And Human Services (HHS) On The
U.S. Government Accountability Office's (GAO) Draft Report Energy
Employees Compensation: Actions To Promote Contract Oversight,
Transparency Of Labor's Involvement, And Independence Of Advisory Board
Could Strengthen Program (GAO-08-4):
General Comments:
HHS appreciates the opportunity to review and comment on GAO's draft
report regarding this important program, and welcomes independent
assessments as a way to improve performance and provide the best public
service.
In various passages of the draft (including Highlights Page "What GAO
Found," and on pages 3, 8, 11, 12, and 13), GAO indicates that the HHS
Centers for Disease Control and Prevention's (CDC) National Institute
for Occupational Safety and Health (NIOSH) "significantly
underestimated contract costs" for the Oak Ridge Associated
Universities (ORAU) contract and that, "while NIOSH had procedures in
place to monitor contract performance, it did not adequately review
contractor costs." CDC/NIOSH and CDC/Procurement and Grants Office
(PGO) carefully and purposely selected a cost reimbursement contract
with a performance award fee as the best contractual mechanism to
provide the agency with technical support to the dose reconstruction
program. This contract mechanism was a 5-year award with $70.1 million
as the initial funding base.
As GAO notes in the draft, there was no prior experience or basis of
understanding regarding the complexities or obstacles which would be
faced in order to perform dose reconstructions on the scale required by
law in this program. Thus, NIOSH and PGO determined that the cost
reimbursable contract with an associated performance driven award fee
allowed the best flexibility and management control. NIOSH and PGO
envisioned from the start that total costs of the contract would exceed
the initial base award. This expectation was clearly indicated and
justified in budget requests as additional work (e.g., development of
unique tools for dose reconstruction, Special Exposure Cohort Petition
evaluations, worker outreach, increasing support to the Advisory Board
on Radiation and Worker Health [ABRWH] deliberations) was required and
directed within the scope of the contract. NIOSH disagrees that it
"significantly underestimated" the contract costs associated with the
ORAU contract as presented by GAO. Rather, NIOSH chose and administered
a contract mechanism that has proven to be responsive to the
requirements of law and program needs and that has afforded effective
management controls over the performance of work as well.
It appears that GAO inaccurately reports, based on estimation
(Highlights Page, "What GAO Found," pages 8, 9, 12) that for fiscal
years (FY) 2001 – 2006 the ORAU contract costs were $200 million, ORAU
costs tripled to $209.7 million, and NIOSH incurred the greatest
administrative costs ($225.3 million) of the involved agencies. From an
HHS perspective, these estimated dollar amounts do not accurately
represent costs incurred from 2001 to the time in FY 2007 when GAO
conducted the review. They should not have been estimated or limited to
FY 2006 which makes the amount look inflated since NIOSH and CDC
provided GAO with costs incurred to the time of the GAO review.
At the conclusion of FY 2007, NIOSH's program administrative costs for
FY 2001 through FY 2007 have been $280 million, of which $220 million
went to all contractors associated with the program ($198 million to
ORAU), $46 million in CDC/NIOSH direct and indirect costs, and $14
million in Advisory Board costs.
The draft also raises concerns regarding the appointment of a balanced
mix of members to the ABRWH. The draft states that the process by which
members are appointed "is not clearly established or uniform,
presenting a challenge to the advisory board's independence." The draft
further states that, while the Energy Employees Occupational Illness
Compensation Program Act and a presidential executive order stipulate
members should represent the scientific, medical, and worker
communities, neither the legislation nor the executive order specifies
criteria for nominating and appointing board members. HHS would like to
emphasize that ABRWH, as a Federal advisory committee, is subject to
the Federal Advisory Committee Act (FACA) requirement that "An advisory
committee must be fairly balanced in terms of the points of view
represented and the functions to be performed" (General Services
Administration Federal Advisory Committee Management Final Rule, 41 CFR
102-3.30(c)). The Department has developed a Federal Advisory Committee
Management Handbook (the Handbook) which clearly outlines policies and
procedures in order to ensure adherence to this requirement by all FACA
committees assigned to HHS, including ABRWH. Specifically, Part III of
the Handbook states: ".Departmental policy provides that committee
membership will be fairly balanced in terms of points of view
represented and the committee's function. Consideration will be given
to a broad representation of geographic areas, gender, race, ethnicity,
and disability."
HHS/CDC utilizes a number of avenues to solicit names of qualified
individuals to consider as nominees for member appointment to its FACA
committees. These avenues may include notices in professional
publications; newspapers; the Federal Register; professional
recommendations from persons in academia, industry, and government; and
referrals from interest groups and affected populations. This process
helps to ensure that committee membership is formed in accordance with
the requirements of FACA, the HHS Handbook, and the individual
committee charters which specify the required expertise.
However, ABRWH is a Presidential advisory committee, and its members
are appointed by the White House – not by HHS. HHS provides the names
of potential nominees to the HHS Office of the White House Liaison.
Although HHS ensures that the nominations provided meet all FACA and
HHS requirements, the White House has final appointment authority and
may accept or reject nominees provided by HHS, or appoint individuals
other than those recommended by HHS.
Another inaccuracy appears on page 21 of the draft which states "NIOSH
issued its first conflict of interest policy for this program on
October 17, 2006." It is important to note that conflict of interest
concerns have been addressed since the beginning of the program. A
conflict of interest policy was the first deliverable under the
contract and, after appropriate review, was incorporated into the
contract on October 8, 2002.
Additional General Comments:
1. On page 22, GAO states that the HHS attorneys who advise the program
are covered by the OCAS Conflict or Bias policy (NIOSH/OCAS COB).
Because the attorneys, who are employees of the HHS Office of the
General Counsel (OGC), are organizationally separate from CDC, NIOSH,
the OCAS Program and the Advisory Board on Radiation and Worker Health
(Advisory Board), they are covered by the HHS ethics and conflict
requirements, instead of the NIOSH/OCAS COB requirements. This helps
ensure that attorneys are held to the highest ethical standards while
remaining separate from, and able to provide unbiased legal advice to,
both program officials and the advisory board.
2. GAO's report does not distinguish between employees of CDC and
employees of the Office of the General Counsel. OGC's structure within
HHS ensures that attorneys providing program advice are
organizationally separate from entities such as program officials and
members of the advisory board and can provide unbiased legal advice
when called upon to do so. It is not clear how the Department of
Defense standards mentioned as an example on page 35 would provide any
additional benefits in this regard.
Following are HHS responses to the recommendations contained in the
draft.
GAO Recommendation: "To strengthen NIOSH's oversight of costs incurred
in the dose reconstruction program and improve NIOSH's review and
approval process for contractor billings, we recommend that the
Secretary of Health and Human Services direct the Director of CDC's
Procurement and Grants Office to:
* Establish appropriate policies and procedures for effective review
and approval of the prime contractor's invoices. Such policies and
procedures should specify the steps to be performed for review and
approval, the individuals responsible for carrying out these steps, the
level of invoice detail needed to perform an appropriate review, and
the appropriate documentation to be maintained of that review process.
* Establish a policy and procedures to periodically assess the prime
contractor's oversight of subcontractor costs to determine if there are
any deficiencies and corrective actions needed and assess whether the
controls can be sufficiently relied on to ensure that subcontractor
payments are allowable, reasonable, and in compliance with all [Federal
Acquisition Regulation] FAR and contract requirements."
HHS Response: HHS agrees with these recommendations and has directed
CDC/PGO to develop procedures for the effective review and approval of
prime contractor's invoices. In addition, CDC/PGO will work with NIOSH
and the prime contractor to establish procedures for the prime
contractor's oversight of the subcontractors to ensure deficiencies are
addressed and corrective actions implemented to enhance the
allowability of payments to contractors.
CDC's Financial Management Office is in the process of procuring a
scanning system that will allow all invoices to be electronically
submitted and processed. This system will permit CDC's finance,
procurement, and program offices to review and approve the invoice and
payment at the same time. Also, CDC/PGO will be implementing a new
contract payment system in fiscal year 2008 which will require a
restructuring of the procedures when implementation of the new system
is complete.
CDC/NIOSH will insert the billing instructions that were issued in
March 2006 which require contractors who were awarded contracts after
this date to provide a monthly breakout of labor rates and charges
associated with each contractor or subcontractor employee.
Additionally, detailed periodic assessments of contractor and
subcontractor invoices will be performed by NIOSH and PGO for future
contracts.
GAO Recommendation: "To further enhance the independence of the
President's Advisory Board on Radiation and Worker Health, we recommend
that the Secretary of HHS implement the agency's regulatory
responsibility under FACA to develop procedures to ensure that the
advisory board's work is not unduly influenced by the appointing
authority or any special interests. These procedures could include a
provision specifying that federal officials who fill key board support
roles must be independent of the dose reconstruction program."
HHS Response: HHS/CDC GENERALLY concurs with this recommendation. As
noted previously, HHS has developed guidance on the nomination of
Presidential advisory committee members in accordance with FACA.
HHS/CDC agrees that there is merit to establishing a more formalized
process for the identification and selection of committee Designated
Federal Officers.
[End of section]
Appendix VI: GAO Contact and Staff Acknowledgments:
GAO Contact:
Dan Bertoni, Director, Education, Workforce, and Income Security (202)
512-7215, bertonid@gao.gov.
Staff Acknowledgments:
Andrew Sherrill, Assistant Director, and Meeta Engle, Analyst-in-
Charge, managed this assignment. Other staff who made key contributions
to this assignment were Claudia Becker, Angela Miles, Robert Sampson,
and Ellen Soltow. In addition, Jessica Botsford, Doreen Feldman, and
Kenneth Patton provided legal assistance; Luann Moy and Mark Ramage
assisted with the methodology; Ruth Walk provided subject matter
expertise; and Charles Willson provided writing assistance.
[End of section]
Related GAO Products:
Hanford Waste Treatment Plant: Department of Energy Needs to Strengthen
Controls over Contractor Payments and Project Assets. GAO-07-888.
Washington, D.C.: July 20, 2007.
Energy Employees Compensation: GAO's Prior Work Has Identified Needed
Improvements in Various Aspects of the Program. GAO-07-233T.
Washington, D.C.: December 5, 2006.
Department of Energy, Office of Worker Advocacy: Deficient Controls Led
to Millions of Dollars in Improper and Questionable Payments to
Contractors. GAO-06-547. Washington, D.C.: May 31, 2006.
Energy Employees Compensation: Adjustments Made to Contracted Review
Process, but Additional Oversight and Planning Would Aid the Advisory
Board in Meeting Its Statutory Responsibilities. GAO-06-177.
Washington, D.C.: Feb. 10, 2006.
Energy Employees Compensation: Many Claims Have Been Processed, but
Action Is Needed to Expedite Processing of Claims Requiring Radiation
Exposure Estimates. GAO-04-958. Washington, D.C.:
Sept. 10, 2004.
Energy Employees Compensation: Even with Needed Improvements in Case
Processing, Program Structure May Result in Inconsistent Benefit
Outcomes. GAO-04-516. Washington, D.C.: May 28, 2004.
[End of section]
Footnotes:
[1] Pub. L. No. 106-398, Title XXXVI, as codified at 42 U.S.C. §§7384-
7385o.
[2] NIOSH is an agency within the Centers for Disease Control and
Prevention in the Department of Health and Human Services.
[3] The Secretary of the Treasury shall transfer the necessary funds
directly from the General Fund of the Treasury to the compensation
fund, upon exhaustion of amounts in the compensation fund, without
further appropriation. (42 U.S.C. §7384e(c)).
[4] Standards for Internal Control in the Federal Government, GAO/ AIMD-
00-21.3.1 (Washington, D.C.: Nov. 1999).
[5] Besides special exposure cohort claims, other claims that are not
referred to NIOSH for dose reconstruction include Radiation Exposure
Compensation Act Section 5 supplement, beryllium, and silicosis claims.
[6] The four locations designated by statute include three gaseous
diffusion plants in Oak Ridge, Tennessee; Paducah, Kentucky;
Portsmouth, Ohio; and an underground nuclear test site on Amchitka
Island, Alaska. In addition, the Secretary of HHS used the authority
granted by Executive Order 13179 to subsequently add 16 more sites to
the special exposure cohort: (1) Allied Chemical, (2) Ames Laboratory,
(3) Dow Chemical, (4) General Atomics, (5) Harshaw Chemical, (6) Iowa
Ordnance Plant, (7) Los Alamos National Laboratory, (8) Linde Ceramics
Plant, (9) Mallinckrodt Chemical Works-Destrehan Street Facility, (10)
Monsanto Chemical, (11) Nevada Test Site, (12) Oak Ridge Institute for
Nuclear Studies, (13) Pacific Proving Grounds, (14) S-50 Oak Ridge
Thermal Diffusion Plant, (15) W.R. Grace, and (16) Y-12 Plant.
[7] Figure 2 provides administrative cost data just for dose
reconstruction cases through fiscal year 2006. NIOSH also provided data
on total administrative costs for all of its activities under EEOICPA-
-updated through the end of fiscal year 2007--including those dealing
with dose reconstructions, SEC petition evaluations, worker outreach,
and the advisory board. NIOSH's total EEOICPA administrative costs from
fiscal year 2001 through 2007 were $280 million, of which $220 million
was for all contractors, $46 million for direct and indirect costs, and
$14 million for the advisory board.
[8] Labor does not break out costs to administer Subtitle B dose
reconstruction cases from costs associated with other types of Subtitle
B cases that do not require dose reconstruction. However, Labor
officials told us that the agency incurs approximately the same costs
to administer all the different types of Subtitle B cases. On the basis
of this assumption, GAO estimated Labor's administrative costs. See
appendix I for additional information on our scope and methodology.
[9] Energy's administrative costs for fiscal years 2002 and 2003
included costs of processing records requests for the Subtitle D
program, which accounted for about 3 percent of total requests while
the remaining 97 percent of requests were for Subtitle B. In addition,
we had to estimate costs for the period October 2003 to April 2004
because Energy did not maintain data on the Subtitle B program prior to
May 2004.
[10] Under the executive order, the advisory board shall consist of no
more than 20 members to be appointed by the President.
[11] Under FACA, the advisory board is also required to conduct most of
its meetings in public and make meeting minutes available to the
public.
[12] GAO, Energy Employees Compensation: Adjustments Made to Contracted
Review Process, but Additional Oversight and Planning Would Aid the
Advisory Board in Meeting Its Statutory Responsibilities, GAO-06-177
(Washington, D.C.: Feb. 10, 2006).
[13] The memorandum to Labor specifies the following five cost-
containment options: (1) require administration clearance of SEC
determination, (2) address any imbalance in membership of the
President's Advisory Board on Radiation and Worker Health, (3) require
an expedited review by outside experts of SEC recommendations by NIOSH,
(4) require NIOSH to apply conflict of interest rules and constraints
to the contractor assisting the advisory board, and (5) require that
NIOSH demonstrate that its site profiles and other dose reconstruction
guidance are balanced.
[14] The cost reimbursement portion was valued at $68.7 million, and
the award fee portion was $1.4 million (2 percent of the contract
amount), for a total of $70.1 million. The actual amount of the fee
earned by the contractor was determined by semi-annual performance
evaluations against award fee criteria.
[15] These technical documents refer to site profiles, technical basis
documents, and technical information bulletins. Site profiles are
documents that describe a specific work site, including physical
appearance and layout, work processes, potential sources of radiation,
and other details important to that site. Each site profile is composed
of six technical basis documents. Technical information bulletins
contain information on specific technical issues or procedures for
estimating radiation exposure for specific or multiple work sites. They
are used to augment or supplement site profiles and technical basis
documents.
[16] See GAO, Energy Employees Compensation: Many Claims Have Been
Processed, but Action Is Needed to Expedite Processing of Claims
Requiring Radiation Exposure Estimates, GAO-04-958 (Washington, D.C.:
Sept. 10, 2004).
[17] For the evaluation period from September 2006 to March 2007,
technical performance included completion of dose reconstructions, and
providing technical assistance in responding to review comments from
the advisory board and its contractor. Technical management included
completion of the backlog of claims, project quality assurance and
control, and SEC support functions.
[18] An Atomic Weapons Employer is an entity other than the U.S.
government that processed or produced radioactive material, for use by
the government, to produce an atomic weapon and has been designated by
the Secretary of Energy as an Atomic Weapons Employer for purposes of
the compensation program.
[19] The Battelle contract was in the form of a cost plus fixed fee
task order lasting 1 year because the work required was much more
limited than the ORAU contract. The task order was awarded in October
2005 and scheduled to expire the following October; its cost
reimbursement portion was $2.7 million and the fixed fee portion was
$188,000, for a total award amount of $2.9 million. This was nearly
twice as much as the government's independent cost estimate of $1.5
million because the personnel proposed by Battelle were more highly
qualified, and thus charged higher labor rates, than those used in the
government estimate. However, the Centers for Disease Control and
Prevention determined that Battelle's proposed rates were fair and
reasonable based on Defense Contract Audit Agency audits of Battelle's
proposed bidding and billing rates.
[20] Battelle's initial scope of work was reduced when six facilities
were deleted from the scope. These six facilities represented 166 out
of 1,447 claims that Battelle was responsible for processing, according
to NIOSH officials. However, NIOSH officials stated that there was no
commensurate decrease in costs because the number of additional claims
received for the remaining Battelle sites more than offset the
reduction in claims from the six deleted facilities.
[21] NIOSH was still in the process of negotiating the next dose
reconstruction contract, as of October 2007. In the interim, ORAU's
contract period has been extended to allow the priority activities of
dose reconstruction cases and SEC petition evaluations to continue
without disruption.
[22] While ORAU previously developed a conflict of interest policy for
its staff that was incorporated into its contract on October 8, 2002,
as a contract deliverable, NIOSH developed a policy for staff and its
contractors in 2006.
[23] The NIOSH policy does not apply to the advisory board, which may
choose to create and administer its own conflict of interest policy to
supplement existing applicable ethics requirements. The NIOSH policy
also does not apply to the contractor assisting the board since the
contractor is expected to conform to conflict of interest provisions
set forth by the board.
[24] The policy covers those attorneys on HHS' Office of General
Counsel Radiation Compensation Legal Team who perform program-related
duties.
[25] The position is temporarily filled by the NIOSH chief of staff
until a permanent individual is appointed.
[26] Executive Order No. 13179, 65 Fed. Reg. 77487 (Dec. 7, 2000).
[27] Estimated percentages are based on a random sample and are subject
to sampling error. All percentage estimates in this report have 95
percent confidence intervals plus or minus 9 percentage points of the
estimate itself. Appendix I provides additional information on the
technical document sample and estimates.
[28] Of the 30 draft NIOSH SEC petition evaluations as of March 5,
2007, Labor officials told us that they provided written comments on 6
and oral comments on 5 evaluations. Officials told us that these oral
comments were not substantive and were never documented. With regard to
the remaining 19 petition evaluations, Labor sent letters to NIOSH
noting "we have no comment" for 7 evaluations, reviewed but provided no
oral or written comments on 2 evaluations, and did not review the
remaining 10 evaluations.
[29] These 2,811 cases also included 10 compensable "glove box" cases
involving claimants who developed prostate and other cancers while
handling potentially harmful materials by using a sealed container with
gloves built into the side, allowing manipulation of objects inside the
container without actually touching them. As with some technical
documents and SEC petition evaluations, some of Labor's comments on
these cases appeared to question NIOSH's scientific assumptions, and we
found it difficult to ascertain how the comments were linked to
adjudication. Labor subsequently explained that it asked NIOSH to
rework the dose estimate using workers' actual employment period and
glove box design so that Labor could adjudicate glove box cases in a
manner consistent with other prostate cancer cases. Eight cases
remained compensable after rework, while two were still awaiting a
final decision.
[30] In fiscal years 2001 to 2005, Labor's appropriation acts
authorized the Secretary of Labor to transfer such funds as necessary
to any executive agency authorized under EEOICPA to carry out those
authorities. In turn, NIOSH provided funding for the advisory board's
operations.
[31] Executive Order 13179 requires HHS to provide the advisory board
with administrative services, funds, facilities, staff, and other
necessary support services, and to perform the administrative functions
of the President under the Federal Advisory Committee Act with respect
to the advisory board.
[32] GAO-06-177.
[33] This option has been proposed in the Energy Employees Occupational
Illness Compensation Program Improvement Act of 2007 (H.R. 268). As of
September 2007, H.R. 268 had been referred to the Subcommittee on
Immigration, Citizenship, Refugees, Border Security, and International
Law of the House Committee on the Judiciary and to the Subcommittee on
Workforce Protections of the House Committee on Education and Labor.
[34] Proposed legislation (H.R. 268) would require that all 12 members
of the advisory board be appointed by Congress. Specifically, the
Speaker of the House of Representatives, President of the Senate,
Minority Leader of the House of Representatives, and Minority Leader of
the Senate would each appoint three board members. In addition, the
appointing entities would be required to select a board member from
each of the following three communities: scientific, medical, and
worker, to ensure all three perspectives were equally represented on
the board.
[35] The 13 members of the Veterans' Disability Benefits Commission are
appointed by the President and leaders of Congress.
[36] GAO, Federal Advisory Committees: Additional Guidance Could Help
Agencies Better Ensure Independence and Balance, GAO-04-328
(Washington, D.C.: Apr. 16, 2004).
[37] National Academy of Sciences, National Academy of Engineering, and
Institute of Medicine; Science and Technology in the National Interest:
Ensuring the Best Presidential and Federal Advisory Committee Science
and Technology Appointments, The National Academies Press (Washington,
D.C.: 2005).
[38] EPA's Science Advisory Board uses the Federal Register to publish
notices seeking nominations to the board, uses its Web site as a
vehicle for soliciting nominations to its peer review committees, and
requests public comment on proposed committee membership.
[39] GAO/AIMD-00-21.3.1.
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