Appendix D
The Role of Medical Personnel in Selected Disability Benefit Programs

This appendix describes some of the major features of five major disability benefit programs:

  1. Veterans disability compensation

  2. Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) Disability

  3. Disability retirement from the U.S. Military

  4. Federal Civilian Disability Retirement under the Civil Service Retirement (CSRS) and Federal Employee Retirement Systems (FERS)

  5. Workers’ compensation and other benefits under the Federal Employee Compensation Act (FECA)

Table D-1, at the end of the appendix, summarizes and compares the role of medical personnel in these disability benefit programs.

VETERANS DISABILITY COMPENSATION

The veterans disability compensation program pays monthly cash benefits to veterans to compensate for loss of earning capacity resulting from injuries or diseases that occurred while in the military, or that became worse during military service. Disability rating (from 10 to 100 percent, in increments of 10 percent) determines the monthly benefit amount.



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A 21st Century System for Evaluating Veterans for Disability Benefits Appendix D The Role of Medical Personnel in Selected Disability Benefit Programs This appendix describes some of the major features of five major disability benefit programs: Veterans disability compensation Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) Disability Disability retirement from the U.S. Military Federal Civilian Disability Retirement under the Civil Service Retirement (CSRS) and Federal Employee Retirement Systems (FERS) Workers’ compensation and other benefits under the Federal Employee Compensation Act (FECA) Table D-1, at the end of the appendix, summarizes and compares the role of medical personnel in these disability benefit programs. VETERANS DISABILITY COMPENSATION The veterans disability compensation program pays monthly cash benefits to veterans to compensate for loss of earning capacity resulting from injuries or diseases that occurred while in the military, or that became worse during military service. Disability rating (from 10 to 100 percent, in increments of 10 percent) determines the monthly benefit amount.

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A 21st Century System for Evaluating Veterans for Disability Benefits Program Administration The Veterans Benefits Administration within the Department of Veterans Affairs administers the veterans disability compensation program. Program References Program rules and operating procedures are primarily contained in 38 U.S.C 1100ff; 38 CFR Parts 3 and 4; VA’s Compensation and Pension Adjudication Manual M21-1MR; and various program guides and worksheets. Disability Definition or Other Qualifying Criteria Qualifying disability is defined as follows: For disability resulting from personal injury suffered or disease contracted in line of duty, or for aggravation of a preexisting injury suffered or disease contracted in line of duty, in the active military, naval, or air service, … the United States will pay to any veteran thus disabled and who was discharged or released under conditions other than dishonorable from the period of service in which said injury or disease was incurred, or preexisting injury or disease was aggravated, compensation as provided in this subchapter, but no compensation shall be paid if the disability is a result of the veteran’s own willful misconduct or abuse of alcohol or drugs.1 Health-Care Professional Role The primary role of the health-care professional is as the provider of medical records used in making the eligibility decision and impairment rating. The initial rating is based on medical records obtained from the applicant’s own heath-care providers, including the veteran’s service medical record (SMR). In most circumstances, this evidence is supplemented by a medical examination from a VA medical center or a contract examination provider. These examinations may be conducted by a physician or by a registered nurse (RN) or physician’s assistant (PA) (reports of RN or PA examinations must be reviewed and countersigned by a physician). In limited circumstances, a specialist conducts the examination. This might be a physician specializing in a certain area of medicine, or a nonphysician health-care provider skilled in a particular kind of examination (e.g., audiologist, psychologist). Health-care professionals are not involved in claim adjudication (including the disability rating). Initial compensation claim ratings are made by 1 38 U.S.C. § 1110 and § 1131.

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A 21st Century System for Evaluating Veterans for Disability Benefits a rating veterans service representative (RVSR), a layperson trained in rating principles and VA’s Schedule for Rating Disabilities (Rating Schedule). Although the RVSR may obtain a medical opinion or an independent medical opinion from a physician to assist with the case evaluation, the physician does not participate in the rating decision. Physicians may also be involved in training RVSRs. The Board of Veterans’ Appeals (BVA) handles appeals of denied claims. Members of the BVA are attorneys. Health-care professionals are not involved, although BVA may also request a medical opinion or independent medical opinion from a physician. SSDI AND SSI DISABILITY These programs provide monthly cash payments to individuals who are unable to work due to a disability. SSDI pays monthly benefits to disabled individuals who are “insured” for these benefits by having paid Federal Insurance Contributions Act (FICA) taxes. Benefits are also available to certain dependents of retired, disabled, or deceased workers. SSI payments are made to disabled individuals who have limited income and financial resources. Program Administration The Social Security Administration administers both the SSDI and SSI programs. Program References Program rules and operating instructions are primarily in 42 U.S.C. 421, 423, 1382, and 1382c; 20 CFR Part 404, Subparts J, P, and Q; 20 CFR Part 416, Subparts I, J, and N; Social Security Rulings; and the agency’s Program Operations Manual System. Disability Definition or Other Qualifying Criteria “Disability” is defined as follows: The term ‘disability’ means … inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. … An individual shall be determined to be under a disability only if his physical or mental impairment or impairments are of such severity that he is not only unable to do his previous work but cannot, considering his age,

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A 21st Century System for Evaluating Veterans for Disability Benefits education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy, regardless of whether such work exists in the immediate area in which he lives, or whether a specific job vacancy exists for him, or whether he would be hired if he applied for work.2 Health-Care Professional Role SSA’s rules require that the existence of a “medically determinable impairment” (in other words, a diagnosis) be established by evidence from an “acceptable medical source,” generally a physician or, for specific kinds of impairments, a psychologist, optometrist, podiatrist, or speech-language pathologist. These medical professionals must meet appropriate licensure or certification requirements, but need not be board certified. The claimant’s own medical sources are the preferred sources of this evidence, as well as additional evidence of the severity of the impairment, which may come from a variety of medical and nonmedical sources. If evidence from the claimant’s own medical sources is insufficient, SSA may obtain a consultative examination from another medical source. These examinations may be obtained from the claimant’s own medical sources, but they are usually obtained from contract medical examination providers. These providers may be physician or nonphysician medical sources, depending on the information being sought. They must be licensed in the state in which they practice, and have the appropriate training and experience to perform the type of examination or test requested. Initial case adjudications are generally performed by two-person teams. One team member is the “medical consultant,” usually either a physician or psychologist. The other team member is the disability examiner, a lay person who is trained by the agency. In limited circumstances, the medical consultant may be a nonphysician optometrist, podiatrist, or speech-language pathologist. There are no requirements that the medical consultant be board certified, although the Institute of Medicine (IOM) Committee on Improving the Social Security Disability Decision Process recently recommended that all physician medical consultants be board certified. First-level appeals, called “reconsiderations,” are generally decided by a different, but identically composed, two-person team (with one lay person and a medical consultant). Second-level appeals are decided by administrative law judges in a nonadversarial administrative proceeding. Administrative law judges may request the presence of a medical expert at the hearing, which is done about 12 percent of the time. Third-level appeals are to the 2 42 U.S.C. § 423(d)(1)(A). There is a similar definition of disability for the SSI program in 42 U.S.C. § 1382c(a)(3)(b).

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A 21st Century System for Evaluating Veterans for Disability Benefits Appeals Council, a panel of judges that reviews administrative law judge decisions. After exhausting these administrative appeals, claimants may seek further relief in the federal courts. SSA has tested several variations on this adjudication process in recent years, and is now in the process of implementing a variation that replaces the reconsideration process with a federal review officer (nonmedical) as the first level of appeal, and an alternative review board as the final step in the administrative review process in place of the Appeals Council. DISABILITY RETIREMENT FROM THE U.S. MILITARY This program provides early retirement benefits to servicemembers who are unable to perform their military duties due to a disability that occurred during service (referred to as a “physical disability,” although the disability may be either a physical or mental disorder). To qualify, the disability must be permanent, must not be the result of intentional misconduct or willful neglect, and must not have been incurred during a period of unauthorized absence. The servicemember must have at least 20 years of service or have a service-connected disability rating (using the VA Rating Schedule) of 30 percent or more. Program Administration The Department of Defense (DoD) and individual U.S. military services administer the program. Program References Program rules and operating instructions are in 10 U.S.C. 1200ff; Department of Defense Directive 1332.18, DoD Instructions 1332.38 and 1332.39; Army Regulations (AR) 635-40 and (AR) 40-501; Secretary of the Navy Instruction 1850.4E; Coast Guard Commandant Instruction M1850.2; and Air Force Instructions (AFI) 36-3212 and (AFI) 48-123. Disability Definition or Other Qualifying Criteria Qualifying disability is defined as … unfit to perform the duties of the member’s office, grade, rank, or rating because of physical disability …3 3 10 U.S.C § 1201(a).

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A 21st Century System for Evaluating Veterans for Disability Benefits Health-Care Professional Role The military services rely on a multistep process, referred to as the DoD Disability Evaluation System, to evaluate fitness for duty when there has been an illness or injury that may affect a servicemember’s ability to perform his or her job. The process begins with a referral to a medical evaluation board (MEB), which is convened at the local medical treatment facility when a servicemember has been treated for a medical condition and has reached maximum medical improvement but may still be unfit for duty. Generally, when an individual’s disability may prevent him or her from meeting service retention standards, the unit commander or a physician at the pertinent medical treatment facility makes the MEB referral. An MEB is composed of 2–3 medical officers (physicians) who determine whether the servicemember’s medical condition calls into question his or her fitness for continued military service or ability to meet retention standards. If not, the MEB returns the servicemember to duty. If the MEB concludes that the servicemember’s disability significantly interferes with the ability to carry out his or her duties, the case is referred to an informal physical evaluation board (PEB), which will make the initial determinations of fitness for duty. The PEB is generally a three-member board consisting of a senior military officer, a personnel officer, and a medical officer (physician). The PEB relies on reports from the applicant’s own health-care professionals (generally, the medical treatment facility at the servicemember’s duty station) and the findings of the MEB. If the PEB decides that the individual is not fit for duty, a disability rating (percentage) based on the VA Rating Schedule also will be assigned. A servicemember who is not satisfied with the PEB decision may request a hearing before a formal PEB. A formal PEB also is a three-member panel with one medical officer (physician). As the name implies, formal PEBs conduct more formal proceedings (hearings at which additional medical evidence and testimony may be presented). FEDERAL CIVILIAN DISABILITY RETIREMENT UNDER CSRS OR FERS Federal Civilian Disability Retirement provides monthly cash benefits to federal employees who are unable to perform their job or a comparable job because of a disability. Program Administration The Office of Personnel Management (OPM) administers the CSRS and FERS programs.

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A 21st Century System for Evaluating Veterans for Disability Benefits Program References Program rules and operating instructions are in 5 U.S.C. 8337 and 8451, and 5 CFR 831 and 844. Disability Definition or Other Qualifying Criteria Qualifying disability is defined as follows: Any employee shall be considered to be disabled only if the employee is found by the Office of Personnel Management to be unable, because of disease or injury, to render useful and efficient service in the employee’s position and is not qualified for reassignment, under procedures prescribed by the Office, to a vacant position which is in the agency at the same grade or level and in which the employee would be able to render useful and efficient service.4 Health-Care Professional Role The primary health-care professional’s role is as the provider of medical records used in case adjudication. Medical documentation is obtained from the federal employee’s own medical source(s). OPM has the authority to request that an applicant undergo examination by an OPM-designated physician; however, such referrals are rare. Initial disability decisions are made by a legal administrative specialist, who is a trained lay person. The disability decision is based on the report(s) of the applicant’s own medical sources, which have to conform to specific report content requirements. Although decision makers have the authority to obtain medical advice from physicians when conducting case adjudication, physicians are not involved in the decision-making process. Second-level appeals are decided by administrative law judges at the Merit System Protection Board. No health-care professionals are involved. BENEFITS UNDER FECA FECA provides for workers’ compensation benefits to civilian federal employees who are not covered by state-run workers’ compensation programs for work-related illnesses and injuries. Benefits include cash compensation, medical coverage, and vocational rehabilitation. Permanent disability may be total or partial. For permanent total disability, claimants receive compensation based on their preinjury earnings. 4 5 U.S.C. § 8337(a).

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A 21st Century System for Evaluating Veterans for Disability Benefits Claimants are rarely found to have total disability, which is considered only in catastrophic injuries or long-standing chronic conditions after all attempts at rehabilitation have failed. This is true even for impairments that the law states are “prima facie” evidence of permanent total disability (loss of both hands, arms, feet, or legs, or the loss of sight of both eyes). Permanent partial disability compensation is based on the difference between the wages earned at the time of injury and the wages the claimant is capable of earning after the injury. For schedule awards, the degree of impairment is established solely by medical evidence and expressed as a percentage of loss of the body part involved. For permanent disability, the determination is considered economic, rather than just medical, and based on both medical and nonmedical factors. Although FECA rules distinguish between impairment (as a medical concept) and disability (as an economic concept), both require a medical evaluation. Case adjudication is performed primarily by nonmedical claims examiners, but with close medical scrutiny. Program Administration The Department of Labor’s (DOL’s) Office of Workers’ Compensation Programs (OWCP) administers the FECA program. Program References Program rules and procedures are in 5 U.S.C. 8101 and 8123; 20 CFR part 10; FECA Procedural Manual Parts 2 and 3; and FECA Program Memoranda. Disability Definition or Other Qualifying Criteria Under FECA, injured workers receive compensation in one of two ways: If the illness or injury involves a limb or organ on a statutory list, they receive compensation according to a fixed schedule, meaning for so many weeks, according to the schedule (referred to as “schedule awards” or permanent impairment).5 For permanent disability, they receive compensation for loss of earnings, either on the basis of total or partial disability.6 5 The schedule is in 5 U.S.C. § 8107(c). 6 5 U.S.C. § 8105 and § 8106.

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A 21st Century System for Evaluating Veterans for Disability Benefits Health-Care Professional Role OWCP administers the FECA program nationally through a network of 12 district offices, each of which has a significant medical staff: The district medical director is a physician7 employed by OWCP who has administrative oversight of the medical functions of the district office, and also serves as liaison with the medical community and federal employers within the district office’s jurisdiction. The district medical director administers the district office’s network of district medical advisors (discussed below) and second opinion medical specialists; provides training to staff regarding medical issues; and provides medical opinions and advice on complex claims. At least one district medical advisor, also a physician, is responsible for interpreting medical reports; performing medical evaluations; performing ratings on schedule awards; and providing guidance to staff on medical issues. District medical advisors are usually part-time contract employees. The staff nurse manages the work of a staff of field nurses who are responsible for case management, including monitoring claimants’ medical progress and assisting their efforts to return to work. The medical management assistant assists the district medical director in the administration of the medical unit and performs associated support functions (e.g., referrals to second opinion and referee specialists). Initial case adjudication is performed by claims examiners based on evidence provided by physicians who have examined the claimant, as well as employment and other records. For cases involving schedule awards, a district medical advisor performs the rating. Permanent total disability determinations must be based on not only the reports of the attending physician and other physicians who have examined the claimant, but also on the opinion of a district medical advisor. If the evidence provided by the treating physician is not sufficient, the claims examiner may request a “second opinion examination” by another physician. Each district office uses a commercial medical examination service, chosen through competitive bidding, to provide second opinion examinations. If the second opinion differs from the treating physician’s, the claims examiner may order a third examination, called a “referee examination.” In this case, the physician is chosen from a directory of physicians maintained 7 By statute, the term physician includes surgeons, podiatrists, dentists, clinical psychologists, optometrists, osteopathic practitioners, and chiropractors within the scope of their practice as defined by state law.

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A 21st Century System for Evaluating Veterans for Disability Benefits by the American Board of Medical Specialties. Consequently, most referee examiners are board certified, although this is not a requirement. Claimants who are dissatisfied with the initial decision on their claim may appeal. They may request reconsideration by the district office within one year. Reconsideration determinations are made by senior claims examiners. The employee may also request either an oral hearing before a Branch of Hearings and Review representative or a review of the written record (but not both), as long as the request is made within 30 days of the formal decision and a reconsideration has not already been requested. Claimants are allowed to submit new evidence when requesting an oral hearing or review of the written record. If the claimant requests a review of the written record, he or she will not be asked to attend or testify. At an oral hearing, the claimant can testify in person or through a designated representative. For either a hearing or review of the record, the hearing representative decides whether to affirm the initial decision, reverse the initial decision and administer benefits to the claimant, or remand the claim to the district office for a new decision. The final appeal option available to claimants is through the Employee’s Compensation Appeals Board (ECAB). The ECAB was created within DOL, but outside of OWCP, to give federal employees the same administrative due process of law and appellate review that nongovernmental workers enjoy under workers’ compensation laws in most states. Each case on appeal is reviewed by three members of the ECAB. ECAB members are appointed by the secretary of Labor. Regulations prohibit the claimant from submitting new evidence during this phase, but the ECAB is not limited by previous “finding of fact” by the district office or Branch of Hearings and Review and can, therefore, reevaluate the evidence and determine if the law was appropriately applied. The ECAB represents the end of the appeal process; claimants may not obtain review through a state or federal court system.

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A 21st Century System for Evaluating Veterans for Disability Benefits TABLE D-1 Summary of the Role of Medical Personnel in Selected Disability Benefit Programs   VA SSA Treating physiciana provides medical evidence? Treating physicians are a source of evidence. Treating physicians are usually the main source of evidence. Specific examination required? Generally, yes. Compensation and Pension (C&P) examination is required in most cases. No, but an examination may be required if treating physician records are incomplete or inconsistent. Examination required if treating physician and agency medical examiner disagree? No No Medical professionals involved in making initial decisions? No. The decision is made by a rating veterans service representative (RVSR). Yes. The decision is made jointly by a medical consultant and claims examiner. Adjudicator access to medical expertise? No, although the RVSR may refer the case back to the C&P examiner in the Veterans Health Administration for further information. Yes. The medical consultant deciding a case may consult other medical consultants. Health-care professionals involved in the appeal process? No, although administrative law judges may remand a case to the field office for development of additional medical evidence. No, although administrative law judges may request the presence of a medical expert at hearings. aThe term “treating physician” may include nonphysician health-care practitioners.

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A 21st Century System for Evaluating Veterans for Disability Benefits DoD CSRS, FERS FECA Treating physicians are a source of evidence. Treating physicians are usually the main source of evidence. Treating physicians are usually the main source of evidence. No. A medical evaluation board reviews the applicant’s medical treatment records and recommends whether to refer the case to a physical evaluation board. No, but in rare instances, the Office of Personnel Management (OPM) may require examination by an OPM-designated physician. No, but if the evidence provided by the treating physician is not sufficient, the claims examiner may request a “second opinion examination.” No No Yes. Examination is by a physician selected from the American Board of Medical Specialties directory. Yes. At least one member of the physical evaluation board is a physician, who also determines the rating. No. The decision is made by a legal administrative specialist. Yes, in cases involving a schedule award. Then the rating is determined by a district medical adviser, usually a contract physician. Yes. The medical officer on the physical evaluation board may consult other medical officers. No Yes. Each district office has a district medical director and one or more district medical advisers with whom the claims examiner can consult. Yes, although the services differ somewhat in their approach to appeals. No. Appeal is to the Merit System Protection Board. No