Bill Introduced to Reform Workers’ Comp for Military Contractors

A proposed update to the Defense Base Act would provide a federal program for workers’ compensation for military contractors killed or injured on the job.

by Cora Currier
ProPublica, June 6, 2012, 3:40 p.m.

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An Iraq contractor watches a crane raise a concrete wall in the south Dora neighborhood in Baghdad, Iraq, on July 4, 2007. (Chris Hondros/Getty Images)

The ranking member of the House Committee on Oversight and Government Reform introduced legislation today that would shore up workers' compensation insurance for civilian military contractors, replacing a controversial private system with one backed by the federal government.

The proposal by Rep. Elijah Cummings, D-Md., would revise provisions in the Defense Base Act, which requires military contractors to provide workers' compensation for American and foreign employees.

Currently, contractors purchase coverage from insurance companies, but as ProPublica reported in 2009, contractors injured in Iraq and Afghanistan often have had to battle with private insurers to obtain medical treatments and disability payments. Many foreign contractors have been entirely left in the dark about the benefits they were owed.

The current system also imposes hefty costs on taxpayers, as the premiums for workers' comp policies are generally built into military contracts. An Army audit concluded that some premiums were "unreasonably high and excessive" and congressional investigations have found that insurers have earned hundreds of millions in profits from them.

In introducing his proposal — under which the government would pay benefits directly to injured contractors or their survivors — Cummings cited a 2009 Pentagon study which estimated that a federal workers' comp program could save taxpayers $250 million a year.

"There is absolutely no reason American taxpayers should be lining the pockets of private insurance companies," he said in a statement.

The Pentagon's report said insurance companies would probably oppose any attempt to alter the Defense Base Act's workers' comp requirements. As of now, AIG, the dominant warzone insurance provider, has not responded to our request for comment on Cummings' bill.

A spokesman for the Department of Labor, which oversees the Defense Base Act's implementation, said they were not yet ready to comment on the proposal.

ProPublica's investigation found that the agency had not expanded its operation to sufficiently cope with the influx of claims that came with unprecedented numbers of contractors in Iraq and Afghanistan.

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8 comments

John

June 7, 2012, 8:56 a.m.

If only the military would provide for the soldiers as well as they’ll provide for the contractors. (Or, y’know, stop sending them to their deaths in a fight we can’t win, but I realize that’s crazy talk.)

It might also help if we held the contractors responsible for their actions, so that we’re preventing the occasional beating, rape, and/or murder, rather than patching it up after the fact.

Jerry

June 7, 2012, 10:31 a.m.

Now do the same for the US healthcare insurance industry….

‘“There is absolutely no reason American taxpayers should be lining the pockets of private insurance companies,” he said in a statement.’

janjamm

June 7, 2012, 2:30 p.m.

Why bother with contractors? If we use them, we should dictate the coverage these companies should carry and the responsibilities of these contracting companies to their employees, American or foreign.There is no reason these contracting companies should make a haul and not have a regulated responsibility to their employees. For the taxpayer to now pickup the tab because the contractor company owners won’t is ludicrous! Put is into the contract! This is purely a bill written by the contractors to elude their responsibility.

Carol Davidek-Waller

June 7, 2012, 2:42 p.m.

Typical of the behavior of most US Corporations; privatize the profits and shift risk onto the backs of taxpayers. We are all ready pay these people double and triple what regular soldiers earn.
They are not defending the nation. They are fighting corporate wars and handing taxpayers the tab. Private armies undermine the democratic process and pose a threat to the Republic.
Yet our elected Representives rubber stamp huge spending bills to line the pockets of corporate mercenaries while voting to skimp on health care, gut education, destroy the social safety net and ignore crumbling infrastructure.

janjamm

June 7, 2012, 3:03 p.m.

@Carol I couldn’t have said it better. Amen.

pmr1228

June 7, 2012, 3:44 p.m.

Good point but as Prior service Army and A contractor its not the contractors or the military being irresponsable its the Corporate beings/AIG,Halliburtion,Mantech,Itt systems,LSI,DynaCorp,Blackwater the corporate heads line thier pockets AIG handles the claims and theres no punishment to them they will fight and deny and wait til your too broke to fight just to make them more money. The government needs to start giving stiffer fines and harsher punishments to corporate greed and funds mismanagement and bonuses.. they sink a company they shouldnt be bailed out by the taxpayers.. there was enough money given in the bailout of AIG to give every tax paying citizen almost 250k now that would stimulate an economy! The DBA needs to be revamped with harsher punishments to the insurers for not paying claims when ordered by a judge. Make the corporates responsable not the taxpayers.

K Adams

June 8, 2012, 1:39 p.m.

I do NOT think the solution should be to treat contractors like soldiers. The solution should be to recruit/draft enough soldiers.

If AIG is treating policy holders badly, why not get a different, more customer oriented company. That is the way capitalism is supposed to work. The contract could specify that a certain number of verified complaints from policy holders is sufficient to cancel the contract and/or reduce premium payments.

roman smetak

June 8, 2012, 4:05 p.m.

OH GEE IS THE CURRENT HAPPENINGS PART OF “CORPORATE RESPONSIBILITY THE RETHUGLICANS BLOW THEIR HORNS ABOUT ALL THE TIME” SEEMS THEY’RE AS RESPONSIBLE AS THEY ARE IN MEXICO, NO WONDER WERE SO UNPOPULAR IN FOREIGN LANDS, MAKE THE MONEY DAMN THE POPULATION AND HELL WITH REGULATION

I SAY DOWN WITH ALL RETHUGLICANS VOTE THEM OUT 2012

Commenting on this story is closed.

This article is part of an ongoing investigation:

Disposable Army: Civilian Contractors in Iraq and Afghanistan

War contractors return home with the same scars as soldiers, but without the support.

The Story So Far

Civilian contractors have been an indispensable part of the U.S. war effort in Iraq and Afghanistan, but they have returned home without the support available for troops in uniform.

Tens of thousands of civilians have worked in the two battle zones, delivering fuel, protecting diplomats and translating for troops, among other jobs.