Review of FECA program reveals fraud-prevention practices, vulnerabilities

Washington – A review of the Federal Employees’ Compensation Act program has identified “promising” practices that could help prevent fraud, but has also uncovered some vulnerabilities in the program, according to recent testimony from a Government Accountability Office official.

Gregory D. Kutz, director of GAO’s Forensic Audits and Investigative Service, provided a statement (.pdf file) on Nov. 9 to the Senate Homeland Security and Governmental Affairs Committee about GAO’s preliminary observations on the FECA program’s fraud-prevention controls. He outlined several fraud-prevention practices, including:

• Periodic reviews of claimants’ continued eligibility
• Use of full-time staff dedicated to the program
• Effective use of investigative resources

However, limited access to data, reliance on self-reported data related to wages and dependent status, and a lack of government-selected physicians were identified as “potential” vulnerabilities in the program that could increase the risk for fraud.

The FECA program provides wage-loss compensation, medical and vocational rehabilitation services, and death benefits to federal workers and their survivors following an on-the-job injury or illness. GAO began its review of the FECA program following concerns about fraud in the system.