OWCP 3rd Party Vendors Claims Management

There is recent evidence that OWCP (under the U.S. Department of Labor) has increasingly began to outsource significant portions of claims-related services for FECA (federal workers' compensation) to third-party vendors, including private companies traditionally known for state workers' compensation claims management. This is a change in the entire structure of the FECA and OWCP government division's responsibilities. 

OWCP has been slowly outsourcing divisions of OWCP to outside contracts in the form of third party vendors. This began with  medical bill processing (e.g., past transitions to vendors like CNSI now called ACCENTRA) and  medical authorizations.  This began when OWCP decided to outsource the pharmacy benefits to an outside corporate vendor called OPTUM, a pharmacy benefit manger to manage all of OWCP's pharmacy benefits. We can expect to see an increasing amount of companies continue to be added for specifically handling broad OWCP claims adjudication, the overall trend of outsourcing to experienced private-sector TPAs vendors from the state workers’ comp ecosystem is now the wave of the future. 

For more information read the show transcript. 

The podcaster is Dr. Stephen Taylor, OWCP medical-legal consultant & DOL expert for Oberheiden Law Firm.  Dr. Taylor’s contact email information is:

https://fedcompconsultants@protonmail.com If you need a medical provider or assistance with an OWCP /  DOL claim in  Pensacola Florida you can make an appointment to see Dr. Taylor  at the clinic at  FWC Medical Centers . To make a consultation with Dr. Taylor  call the clinic at 813-215-4356  in Florida.

For responses email Dr. Taylor at fedcompconsultants@protonmail.com

Support the show

FEEDSPOT TOP #1 Federal Workers Compensation Podcast & #6 National Workers Compensation Podcast:

Transcript

HI I’m Dr. Stephen Taylor a federal Workers Compensation Consultant and a medical provider in Tampa & Pensacola Florida who has been helping government employees with work-related injuries, disability, FERS Disability, VA disability and other types of Federal program filings for 30 years. I have helped too many people to count  all over the country with properly filing their Federal Workers Compensation Claims and/or disability claims for about three decades. After all these years I have decided  to create a tutorial podcast to assist with all kinds of topics related to injured federal workers and/or contractors. The name of this tutorial podcast is  Federal Workers Compensation Coffee break Podcast. It is based on the lunch and learn short learning format.  Here at this podcast we discuss all sorts of topics related to federal workers compensation, Department of Labor, OWCP, FECA ACT, FERS, longshore-maritime, DOD contractors, VA benefits over a cup of coffee. I cover these relevant topics in a short coffee break style format because in order to discuss topics that  government employees always ask for assistance on for all of these years.  I do this to assist you the government employee, you and your doctor or your coworkers with claim filing denials or with appropriate filing of benefit claims, disability or injured worker claims. The best part about this podcast and all of it’s tutorials for successfully navigating DOL, FERS & OWCP benefits… is that I do it all for free. All you need is a cup of coffee and a notebook. I want to announce that I am actually staying in Florida and not moving back home to Texas but I am working with a clinic in Texas and will be announcing more on that in the future. 

Today we are going the new outsourcing of OWCP claims management to third party vendors who come from the state workers compensation environment and how this is effecting a lot of change to the  claims processing process.  OWCP is going to look a lot different in the future. So, I am going to take a break from our claims examiner training manual and discuss the future of OWCP and what to expect. 

Ok let's get out coffee going and  READY---LET'S BEGIN?

I want to discuss today a subject matter that is a growing concern in OWCP claims management. There is clear evidence that OWCP (under the U.S. Department of Labor) has increasingly began to outsource significant portions of claims-related services for FECA (federal workers' compensation) to third-party vendors, including private for profit companies traditionally known for state workers' compensation claims management.

Key Examples

Sedgwick Government Solutions (a Sedgwick subsidiary): In February 2025, Sedgwick was awarded a five-year, $360 million contract with DOL/OWCP to provide nurse and vocational rehabilitation case management services nationwide. This supports OWCP’s Nurse Intervention Program and Vocational Rehabilitation Program, including field nurse/triage case management and counselor services for injured federal employees. Sedgwick will now be managing cases very early in the claims filing process that follows the ODG-MCG guidelines  from state workers’ comp third-party administration (TPA) into federal work injuries.

QTC (QTC Medical Services / Leidos QTC Health Services): QTC holds contracts with OWCP/DOL for medical second opinion and examination services (SECOPs). They schedule and provide independent medical examinations, file reviews, and related services for FECA claims. OWCP has used QTC  recently to arrange second-opinion and referee exams. This is why we are seeing a lot of 2nd opinion doctors that are  "traveling orthopedic surgeons" and why we are seeing so many boilerplate style reports that all contain the same style denial language.

OWCP uses Contract Medical Consultants (CMCs) where physicians review files without exams. These are often facilitated through contracted network

There are two more vendors that I will not mention today but I know are in the final negotiations are have recently been added to the third party vendors list for aspects of billing, authorization and claims management. We will discuss these vendors in the future. 

Other outsourcing: OWCP also contracts for medical bill processing (e.g., past transitions to vendors like CNSI now called ACCENTRA) and uses medical referral groups for exams. This began when OWCP decided to outsource the pharmacy benefits to an outside corporate vendor called OPTUM, a pharmacy benefit manger to manage all of OWCP's pharmacy benefits. We can expect to see an increasing amount of companies continue to be added for specifically handling broad OWCP claims adjudication, the overall trend of outsourcing to experienced private-sector TPAs vendors from the state workers’ comp ecosystem is now the wave of the future. These third party vendors have their own internal guidelines, and they are designed to create more denials of care and eliminate cost by circumventing the OWCP and FECA Act legislated rules and provisions. 

Context and Purpose

OWCP retains ultimate decision-making authority on claim acceptance, benefits, and denials, but it contracts out operational support like:

Case management (nurse/vocational).

Medical scheduling and second-opinion/referee exams.

Bill processing and utilization review to third party vendors with their own guidelines. 

This is done to handle volume, leverage specialized expertise, and control costs—common practices in both federal and state workers’ comp systems. Sedgwick, for instance, markets its government solutions based on its broad TPA experience in state programs.

These arrangements are documented in federal contract announcements, DOL sites, and vendor press releases. 

For your specific claims, you can now expect that the probative value medical evidence denial argument due to  these QTC 2nd opinion's  reports will be flooding the market for everything from  continuation of care, expansion and consequential conditions. Your treating physician's letters of response will be denied with a newer denial reason of not warranting a merit review at a much higher percentage  than in years past. Understanding how to present probative value medical evidence and support evidence with equal peer to peer review by musculoskeletal specialist such as orthopedic surgeons will be required to be able to warrant merit review of all of these case denials. I also see a lot more need for attorney's in the future in these type of denials. Which sadly I believe will delay care even further than the current claims management model. This is not legal advice—I am a medical consultant and not a lawyer. My advice is to seek out a FECA-experienced representative or attorney for case-specific applications. 

Office procedures provide that a physician who performed a fitness-for-duty examination of the  claimant for the employing agency may not be considered a second opinion specialist for purposes of  creating a conflict in medical evidence or for reducing or terminating benefits based on weight of  medical evidence.¹ 1Mary L. Barragy, 47 ECAB (Docket No. 93-2326, issued January 23, 1996); John Watkins, 47 ECAB (Docket No. 94-1615, issued May 17, 1996).

When there are opposing medical reports of virtually equal weight and rationale, the case must be  referred to an impartial medical specialist ( referee doctor), pursuant to section 8123(a), to resolve the conflict  in the medical evidence. Thomas J Fragale, 55 ECAB (Docket No. 04-835, issued July 8, 2004).

Let me give you some examples of what we are seeing out their from these QTC reports. 

The following is excerpts of documentation I have received and reviewed with all of the names redacted.

 Dr. Example  is board-certified in family & emergency medicine who reveals examination findings of diminished trunk ROM, diminished reflexes, referred leg pain, (+) orthopedic tests for trunk facet and discogenic pain, muscle strength, trunk positional tolerance difficulties, and right leg & bilateral buttocks referred pain over a period of 15 months of physical examination findings. Dr. Example also presents evidence of an independent functional capacity evaluation that was determined to be a valid study. The functional capacity testing (FCE) revealed valid results with optimal effort and negative Waddell's and malingering testing.  Example patient is able to return to employment including sedentary to light work but is limited in continuous trunk positional tolerances and leg  movements that are repetitive due to trunk positional bending tolerances to prolonged (more than 30-60 minutes), multi-task abilities in weight bearing and walking deficits. 

 Dr. Example also explains that "The referred pain, positive orthopedic test, LROM. Dr OWCP is a board certified orthopedic surgeon and provided a well rationalized report to support  his opinion that the work related exacerbation and strain have resolved. He opined that the  subjective complaints were not supported by the objective findings and that any restrictions were due to the pre-existing degenerative conditions. The opinions are not of equal weight and  therefore do not create a conflict of medical opinion requiring a Referee Examination. The medical  evidence does not support 

The opposing  weight of medical evidence presented  by the  treating physician due to the  report of a physician whose specialty is not in a germane area of medicine is entitled to lesser weight and is not found to be probative in medical value because the medical opinion of Dr. example  is not sufficient to shift the weight of medical. A report of a physician whose specialty is not a musculoskeletal expert is  entitled to lesser probative value weight. Beverly A Spencer, 55 ECAB (Docket No. 03-2033, issued May 3, 2004).

REQUIREMENTS FOR ENTITLEMENT: In accordance with the regulations set forth in 20 CFR § 10.609, if  an application for reconsideration is accompanied by new and relevant evidence or by an arguable  case for error, OWCP will conduct a merit review of the case to determine whether the prior  decision should be modified.

We have not modified our prior decision. However, we have evaluated the evidence you submitted and  have determined that your request does not merit a review  of your case under 5 U.S.C. 8128. Our second opinion physician is an orthopedic surgeon and is a musculoskeletal expert. A report of a physician whose specialty is not a musculoskeletal expert is  entitled to lesser probative value weight and your request for a for a referee to resolve the conflict between our second opinion and the treating physician does not warrant a merit review.  The opinions are not of equal weight and therefore do not create a conflict of medical opinion requiring a Referee Examination. The medical evidence does not support that you  continue to be partially disabled and require further treatment from your work-related injuries to you low back. CONCLUSION: Therefore, as the evidence presented is not of sufficient probative value to alter the  decision, modification of the decision is hereby denied.

I want to outline here… at this point that there is a systematic approach for your doctor to counter these denial tactics, though it requires disciplined, evidence-focused responses grounded in FECA rules (5 U.S.C. § 8101 et seq.), the implementing regulations (20 CFR Part 10), and the OWCP FECA Procedure Manual. These outsourced second-opinion processes (via QTC, CMC  and similar vendors) often rely on boilerplate language that dismisses ongoing residuals, cites objective/subjective do not match, negative Waddell's signs, attributes issues to pre-existing degeneration, and prioritizes orthopedic specialists. OWCP may then down weight treating physicians rebuttal response letters who are not "musculoskeletal experts" (e.g., family medicine, emergency medicine, or others without orthopedic board certification).

This is a new calculated pattern in federal workers' compensation, but it is not insurmountable. OWCP must follow due process, weigh evidence properly, and resolve true conflicts with a referee (impartial) examination under 5 U.S.C. § 8123(a) and 20 CFR § 10.321. Boilerplate reports can be challenged if they lack individualized rationale. These 2nd opinion reports are literally word for work 90% similar. They are challengeable when the same 2nd opinion writes the same verbiage for every person that he sees. 

Core Principles from FECA/OWCP Rules

Weight of evidence is based on multiple factors: rationality (explanation of how findings support conclusions), consistency with the record/history, objectivity (supported by exam/tests), and specialization (relevant board certification helps but is not decisive alone). All factors must be "virtually equal" before specialty tips the scale. A generalist’s report is not automatically lesser if it is more detailed, consistent with diagnostics/FCE, and well-explained.

Conflict resolution: If reports are of "virtually equal weight and rationale" but reach opposing conclusions, OWCP must refer to a referee (impartial specialist with no prior connection). Treating physician + strong rebuttal can create this.

Reconsideration: Requires "new and relevant evidence" or "arguable case for error" (20 CFR § 10.606). A detailed rebuttal addressing the second opinion point-by-point often qualifies.

Boilerplate weakness: Generic statements (e.g., "subjective complaints not supported by objective findings," "no residuals," repeated Waddell's) can be attacked for failing to address specific findings, FCE validity, additional diagnostic tests, nerve studies, MRIs, serial exams, or other types of  imaging.

The OWCP claims examiner's often  cited Beverly A. Spencer, 55 ECAB 501 (2004) supports giving lesser weight to non-specialists in some contexts, but OWCP/ECAB decisions emphasize that specialization is only one factor and reports must still be well-rationalized.

So, treating physicians are receiving denials with  this "well rationalized" language utilized a lot more often in claims examiners denials. But, what does the FECA act actually say about what is the definition of a "well rationalized" report. 

A "well-rationalized medical report" (or "well-reasoned" medical opinion) in OWCP/FECA claims is medical evidence where the physician's conclusions are supported by a clear, logical explanation connecting their findings to the opinion. OWCP and the Employees’ Compensation Appeals Board (ECAB) require this for the report to carry significant probative (persuasive) weight.

Official Explanation from OWCP FECA Procedure Manual

The term “rationalized” means that the statements of the physician are supported by an explanation of how his or her conclusions are reached, including appropriate citations or studies.

An opinion that is well-rationalized provides a convincing argument for a stated conclusion that is supported by the physician’s reasonably justified analysis of relevant evidence.

For example:

An opinion supported by the interpretation of diagnostic evidence (e.g., MRI, EMG, FCE results) and relevant medical or scientific literature is well-rationalized.

An opinion that simply states a conclusion (e.g., “no residuals,” “subjective complaints unsupported”) without explaining the reasoning is not well-rationalized.

Key Elements of a Well-Rationalized Report

OWCP weighs reports using these factors (drawn from ECAB precedent and the Procedure Manual):

Complete and accurate history — Includes full factual (work injury details, job duties) and medical background (prior conditions, serial exams, diagnostics).

Objective findings — Physical exam results, positive orthopedic tests, ROM measurements, imaging, lab results, or valid functional capacity evaluations (FCE).

Clear explanation (rationale) — The doctor must explain why and how the findings support the diagnosis, causal relationship, ongoing residuals, disability, or need for treatment. Vague or boilerplate statements get less weight.

Logical connection — Links specific employment factors to the condition (e.g., “Repetitive bending aggravated the disc herniation, as shown by these exam findings over 15 months...”).

Consistency — With the overall record; internal contradictions weaken the medical argument. 

Unequivocal opinion — Usually stated to a high degree or a reasonable degree of medical certainty.

Additional required content for medical reports (per 20 CFR § 10.330) includes: dates of exams/treatment, history, findings, diagnosis, prognosis, non-work conditions, causal opinion, and work impact.

Why This Matters in OWCP Appeals Context

In the denial letters that are being sent out now, OWCP CE often calls the second-opinion orthopedic report “well-rationalized” while down weighting the treating physician’s report (especially if from a non-orthopedist). You can counter this by having your doctor produce a point-by-point rebuttal that explicitly addresses the second opinion’s boilerplate claims with detailed rationale, objective evidence, and explanations. This helps create (or strengthen) a true conflict requiring a referee exam.

Bottom line: It’s not enough for a doctor to say “the patient has ongoing pain and restrictions.” They must explain why the objective evidence supports that conclusion, rather than pre-existing degeneration or “no residuals.”

Systematic Appeal/Response Strategy

Immediate Rebuttal from Treating Physician:

Have your OWCP-approved treating doctor (ideally one with relevant experience, even if not ortho) review the full second-opinion report, SOAF (Statement of Accepted Facts), questions posed, and your file.

Request a detailed narrative that:

Directly addresses each boilerplate point (e.g., explains why diminished ROM, positive orthopedic tests, referred pain, and valid diagnostic studies and/or FCE do support residuals and restrictions).

Cites serial exams over a period of time showing consistency.

References objective evidence (imaging, EMG, FCE with valid effort/negative Waddell's where applicable).

Explains why pre-existing degeneration does not negate work-related exacerbation/aggravation.

Asserts ongoing disability/treatment needs with rationale tied to FECA standards.

This can create or strengthen a conflict. Many advocates recommend this as the first step.

Request Referee Examination:

In your response/reconsideration, explicitly argue that the reports are of equal (or your side superior) weight, triggering 5 U.S.C. § 8123(a) and 20 CFR § 10.321. Cite cases like Thomas J. Fragale, 55 ECAB ___ (2004). This one is cited often in CE  denials but contains more supportive verbiage and is often misrepresented in denials. 

OWCP cannot simply dismiss and/or denial claim appeals based on specialty if rationale is comparable. This is not supported in the FECA Act

File for Reconsideration (Most Common First Step):

Within 1 year of the decision (strict deadline).

Submit the rebuttal + any new evidence (updated exams, diagnostics, functional testing).

Argue procedural error (failure to properly weigh evidence or resolve conflict) + new relevant medical evidence.

Hearing or Review of the Written Record:

Request within 30 days of denial (oral hearing or written record review via Branch of Hearings & Review).

This allows presentation of arguments/evidence before a hearing rep.

Further Appeals:

If needed, to the Employees’ Compensation Appeals Board (ECAB) within 180 days. ECAB reviews the record for legal/procedural compliance but accepts no new evidence.

Additional Tactics:

Challenge the second opinion: Document inconsistencies, incomplete history, or bias indicators. Complaints about QTC examiners can go through OWCP or state medical boards, though success varies.

Involve specialists: If possible, transfer care or request to be seen with OWCP approval to a board-certified orthopedic surgeon, neurosurgeon and/or  physiatrist specialist aligned with your conditions for stronger reports.

DMA Review: OWCP sometimes uses a District Medical Adviser for file review—ensure your evidence is strong enough to influence this.

Track everything: Maintain a timeline, copies of all submissions, and deadlines.

Practical Tips for Fighting Back Effectively

Work with OWCP-experienced providers who understand FECA report requirements (detailed rationale, not just "patient reports pain").

Consider a FECA-knowledgeable attorney or representative (e.g., via WILG or federal workers' comp specialists). They can frame arguments, ensure procedural compliance, and handle complex rebuttals. Many offer consultations.

Avoid emotional language—focus on medical facts, FECA citations, and procedural violations.

These systems are designed for efficiency/cost control, but persistent, high-quality medical evidence often prevails on reconsideration or hearing.

Resources like the DOL OWCP site, Procedure Manual (available online), and ECAB decisions provide the foundational rules. Persistence with strong, point-by-point medical rebuttals is the most effective counter to templated denials.

Ok… I think that is enough for today…I need to warm up this coffee and get going. I want to thank you for listening and want to remind you to share this podcast with other federal workers you think would benefit from this information. Also be kind enough to leave a 5 star review on the platform you found this podcast, like or subscribe to any of the major podcast platforms  so others will also find this information. Also if you need an approved  medical provider for your DOL -OWCP Or Longshore case in Florida you can still  find me in  Pensacola and Tampa. To make a consultation with me to discuss your case or if you know someone if Florida who is recently injured you can call the clinic at 813-215-4356 or 813-877-6900 or go  to our website at https://fedcompconsultants.com/   & https://mrtherapycenter.com/  Also if you are in  another state and you want me to assist you with claim questions or assistance for your  doctor you can email me at fedcompconsultants@protonmail.com As usual I want to thank all of you who put on that uniform, that badge, deliver that mail, take care of our veterans and make this government run… a big thank you. I do this for free just for you…We could not do this  without all of the work all of you out there do…so this is my big  thank you. And remember if you  have an injured federal claim and you need assistance….I am  here to help!. Also remember there is power in prayer. Pray for your nation, coworkers and for God's providence in current times of unrest and war. God Bless.

See you next time.