provider of his or her right to request, within 30 days of the date of the adverse decision, a formal hearing before an administrative law judge under the procedures set forth below. The filing of a request for a hearing within the time specified shall operate to stay the effectiveness of the decision to exclude.

[49 FR 18980, May 3, 1984, as amended at 52 FR 10522, Apr. 1, 1987]

$10.453 Requests for a hearing.

(a) A request for hearing shall be sent to the official representative §10.452(b)(6)) and contain:

(see

(1) A concise notice of the issues on which the provider desires to give evidence at the hearing.

(2) Any request for a more definite statement by the Office.

(3) Any request for the presentation of oral argument or evidence.

(4) Any request for a certification of questions concerning professional medical standards, medical ethics or medical regulation for an advisory opinion from a competent recognized professional organization or Federal, State or Local regulatory body.

(b) If a request for hearing is timely received by the designated official representative, the official representative shall refer the matter to the Chief Administrative Law Judge of the Department of Labor, who shall assign it for an expedited hearing. The administrative law judge assigned to the matter shall consider the request for hearing, act on all requests therein, and issue a Notice of Hearing and Hearing Schedule for the conduct of the hearing. A copy of the hearing notice shall be served on the provider by certified mail, return receipt requested. The Notice of Hearing and Hearing Schedule shall include:

(1) A ruling on each item raised in the request for hearing.

(2) A schedule for the prompt disposition of all preliminary matters including requests for more definite statements and for the certification of questions to advisory bodies.

(3) A scheduled hearing date not less than thirty days after the date the schedule is issued, and not less than fifteen days after the scheduled conclusion of preliminary matters, provided

that the specific time and place of the hearing may be set on ten days notice.

(c) The purpose of the designation of issues is to provide for an effective hearing process. The provider is entitled to be heard on any matter placed in issue by his or her response to the Notice of Intent to Exclude, and may designate "all issues" for purposes of hearing. However a specific designation of issues is required if the provider wishes to interpose affirmative defenses, or request the issuance of subpoenas or the certification of questions for an advisory opinion.

(d) The provider may make application for the issuance of subpoenas upon a showing of good cause therefore to the administrative law judge.

(e) A certification of the request for an advisory opinion concerning professional medical standards, medical ethics or medical regulation to a competent recognized or professional organization or Federal, State or local regulatory agency may be made:

(1) As to an issue properly designated by the provider, in the sound discretion of the administrative law judge, provided that the request will not unduly delay the proceedings;

(2) By the Office on its own motion either before or after the institution of proceedings, and the results thereof shall be made available to the provider at the time that proceedings are instituted or, if after the proceedings are instituted, within a reasonable time after receipt: provided, that the opinion, if rendered by the organization or agency, is advisory only and not binding on the administrator law judge.

§ 10.454 Hearings and recommended decision.

(a) To the extent appropriate proceedings before the administrative law judge shall be governed by 29 CFR part 18 (promulgated July 15, 1983, at 48 FR 32538).

(b) The administrative law judge shall receive such relevant evidence as may be adduced at the hearing. Evidence shall be presented under oath, orally or in the form of written statements. The administrative law judge shall consider the Notice and Response,

including all pertinent documents accompanying them, and may also consider any evidence which refers to the provider or to any claim with respect to which the provider has provided medical services, hospital services, or medical support services and supplies, and such other evidence as the administrative law judge may determine to be necessary or useful in evaluating the matter.

(c) All hearings shall be recorded and the original of the complete transcript shall become a permanent part of the official record of the proceedings.

(d) Pursuant to 5 U.S.C. 8126, the administrative law judge may:

(1) Issue subpoenas for and compel the attendance of witnesses within a radius of 100 miles;

(2) Administer oaths;

(3) Examine witnesses; and

(4) Require the production of books papers, documents, and other evidence with respect to the proceedings.

(e) At the conclusion of the hearing, the Administrative Law Judge shall issue a written decision and cause it to be served on all parties to the proceeding, their representatives and the Director.

§10.455 Review by Director.

(a) Procedure. Any party adversely affected or aggrieved by the decision of the Administrative Law Judge may file a petition for discretionary review with the Director within 30 days after issuance of the decision. The Judge's decision, however, shall be effective on the date issued and shall not be stayed except upon order of the Director.

(b) Review discretionary. Review by the Director shall not be a matter of right but of the sound discretion of the Secretary.

(c) Grounds. Petitions for discretionary review shall be filed only upon one or more of the following grounds:

(1) A finding or conclusion of material fact is not supported by substantial evidence;

(2) A necessary legal conclusion is erroneous;

(3) The decision is contrary to law or to the duly promulgated rules or decisions of the Director;

(4) A substantial question of law, policy, or discretion is involved; or

(5) A prejudicial error of procedure was committed.

(d) Requirement. Each issue shall be separately numbered and plainly and concisely stated, and shall be supported by detailed citations to the record when assignments of error are based on the record, and by statutes, regulations, or principal authorities relied upon. Except for good cause shown, no assignment of error by any party shall rely on any question of fact or law upon which the Judge had not been afforded an opportunity to pass.

(e) Statement in opposition. A statement in opposition to the petition for discretionary review may be filed, but such filing shall in no way delay action on the petition.

(f) Scope of review. If a petition is granted, review shall be limited to the questions raised by the petition.

(g) Denial of petition. A petition not granted within 20 days after receipt of the petition is deemed denied.

(h) The decision of the Director shall be final with respect to the provider's participation in the program, and shall not be subject to further review by any court or agency.

$10.456 Effects of exclusion.

(a) The Office shall give notice of the exclusion of a physician, hospital, or provider of medical support services or supplies to:

(1) All OWCP district offices;

(2) All employing Federal agencies; (3) The Health Care Financing Administration;

(4) The State of Local authority responsible for licensing or certifying the excluded party;

(5) All claimants who are known to have had treatment, services or supplies from the excluded person within the six month period immediately preceding the order of exclusion.

(b) Notwithstanding any exclusion of a physician, hospital, or provider of medical support survices or supplies under this subpart, the Office shall not refuse a claimant reimbursement for any otherwise reimbursable medical treatment, service or supply if:

(1) Such treatment, service or supply was rendered in an emergency by an excluded physician; or

(2) Claimant could not reasonably have been expected to have known of such exclusion.

(c) A claimant who is notified that his or her attending physician has been excluded shall have a new right to select a duly qualified physician. See § 10.401(b).

$10.457 Reinstatement.

(a) If a physician, hospital, or provider of medical support services or supplies has been automatically excluded pursuant to §10.451, the person excluded will automatically be reinstated upon notice to the Office that the conviction or exclusion which formed the basis of the automatic exclusion has been reversed or withdrawn. However, an automatic reinstatement shall not preclude the Office from instituting exclusion proceedings based upon the underlying facts of the matter.

(b) A physician, hospital, or provider of medical support services or supplies excluded from participation as a result of an order issued pursuant to this subpart may apply for reinstatement one year after the entry of the order of exclusion, unless the order expressly provides for a shorter period. An application for reinstatement shall be addressed to the Associate Director for Federal Employees' Compensation, and shall contain a concise statement of the basis for the application. The application should be accompanied by supporting documents and affidavits.

(c) A request for reinstatement may be accompanied by a request for oral argument. Oral argument will be allowed only in unusual circumstances where it will materially aid the decisional process.

(d) The Associate Director shall order reinstatement only in instances where such reinstatement is clearly consistent with the ultimate goal of this subpart which is to protect the FECA program against fraud and abuse. To satisfy this requirement the provider must provide reasonable assurances that the basis for the exclusion will not be repeated.

Subpart G-Cases Involving the Liability of a Third Party

$10.500 Prosecution of third party action by a beneficiary.

If an injury or death for which benefits are payable under the Act is caused under circumstances creating a legal liability upon some person or persons other than the United States to pay damages, the Office may require the beneficiary to prosecute an action for damages against the third party. When so required, the cause of action shall be prosecuted in the name of the beneficiary.

[52 FR 10522, Apr. 1, 1987]

§ 10.501 Assignment of third party.

If an injury or death for which benefits are payable under the Act is caused under circumstances creating a legal liability upon some person other than the United States to pay damages therefore, the beneficiary shall, if required by the Office assign any right of action he may have to the United States. All such assignments shall be in writing and no such cause of action shall vest in the United States unless and until the assignment is accepted by the Office.

$10.502 Refusal to assign or prosecute claim when required; effect.

Refusal on the part of a beneficiary to assign his right of action to the United States or to prosecute an action in his own name when required to do so pursuant to §10.500 or §10.501, shall deprive the beneficiary of all rights to benefits under the Act.

§ 10.503 Distribution of damages recovered by beneficiary.

If an injury or death for which benefits are payable under the Act is caused under circumstances creating a legal liability upon a person or persons other than the United States to pay damages and, as a result of claim brought by or settlement made by the beneficiary or by someone acting on the beneficiary's behalf, the beneficiary recovers damages or receives money or other property in satisfaction of the liability on account of that injury or death, the

proceeds of the recovery shall be applied as follows:

(a) If an attorney is employed, a reasonable attorney's fee and cost of collection, if any, shall first be deducted from the gross amount of the settlement;

(b) The beneficiary is entitled to retain one-fifth of the net amount of the money or other property remaining after the expenses of a suit or settlement have been deducted.

(c) There shall then be remitted to the Office the benefits which have been paid on account of the injury including payments made on account of medical treatment, transportation costs, funeral expenses, and any other payments made under the Act on account of the injury or death, but not including continuation of pay as provided by 5 U.S.C. 8118. If an attorney was employed, the amount to be remitted to the Office shall be reduced by an amount equivalent to a reasonable attorney's fee proportionate to any refund to the United States.

(d) Any surplus remaining after proper refund has been made to the Office may be retained by the beneficiary but shall be credited by the Office against future payment of benefits to which the beneficiary may be entitled under the Act on account of the same injury or death.

[40 FR 6877, Feb. 14, 1975, as amended at 52 FR 10522, Apr. 1, 1987]

$10.504 Distribution of damages where cause of action is assigned.

If recovery is realized upon a cause of action assigned to the United States pursuant to 5 U.S.C. 8131, the money or other property so received shall be applied in the following manner: After deducting the amount of any payments made under the Act in respect of the injury or death on account of which the cause of action arose, and the expense of such realization or collection, which sum shall be placed to the credit of the proper fund of the Office, the surplus, if any, of such amount received shall be paid to the beneficiary and credited pro tanto upon any future payment of benefits payable to him on account of the same injury. However, the beneficiary is entitled to not less than one-fifth of the net amount of a

settlement or recovery remaining after the expenses of such realization or collection have been deducted.

$10.505 Office may require beneficiary to settle or compromise third party suit.

Where a beneficiary under the Act has commenced an action in his or her own name or has initiated such action through an administrator of a deceased person to recover damages against the third party liable for the injury or death, the Office shall, at all times, have authority to require the beneficiary or such administrator to settle or compromise such action whenever it shall determine that further prosecution of the cause of action is not warranted. Refusal on the part of such beneficiary or other person acting in the interest of the beneficiary to make such settlement or to effect such compromise when so directed shall be deemed to be sufficient cause for refusal on the part of the Office to pay or cause to be paid any benefits under the Act on account of the same injury or death, or the Office may suspend or cause to suspend the payment of benefits under the Act during the period of such refusal.

$10.506 Official superior's responsibility in cases involving potential third party liability.

If it appears that an injury or death for which benefits are payable under the Act was caused under circumstances creating a legal liability upon a person or persons other than the United States to pay damages, the official superior or other agency official shall investigate the third party aspect of the injury or death and submit a report of the findings with related documents to the Office.

[52 FR 10523, Apr. 1, 1987]

§ 10.507 Satisfaction of the interest of the United States.

No court, insurer, attorney, or other person shall pay or distribute to the beneficiary or the beneficiary's designee the proceeds of any suit or settlement without first satisfying or assuring satisfaction of the interest of the United States.

[52 FR 10523, Apr. 1, 1987]

Subpart H-Special Category Employees

SOURCE: 52 FR 10523, Apr. 1, 1987, unless otherwise noted.

PEACE CORPS VOLUNTEERS

§10.600 Definition of volunteer.

The term "volunteer" means(a) A volunteer enrolled in the Peace Corps under 22 U.S.C. 2504;

(b) A volunteer leader enrolled in the Peace Corps under 22 U.S.C. 2505; and

(c) An applicant for enrollment as a volunteer or volunteer leader during a period of training under 22 U.S.C. 2507(a) before enrollment.

§ 10.601 Applicability of the Act.

Except as provided by 5 U.S.C. 8142 and elsewhere in this subpart, the provisions of the Act are applicable to Peace Corps volunteers.

§ 10.602 When disability compensation

commences.

Pursuant to 5 U.S.C. 8142(b), entitlement to disability compensation payments does not commence until the day after the date of termination of the volunteer's service.

§ 10.603 Pay rate for compensation purposes.

(a) The pay rate of a volunteer is the lowest step of grade 7 of the General Schedule.

(b) The pay rate of a volunteer leader is the lowest step of grade 11 of the General Schedule.

(c) The pay rate of a volunteer with one or more minor children as defined in 22 U.S.C. 2504 is the lowest step of grade 11 of the General Schedule.

(d) The pay rate for compensation purposes is defined as the pay rate in effect on the date following separation, provided that it is equal to or greater than the pay rate on the date of injury, and is not subject to the provisions of 5 U.S.C. 8101(4).

$10.604 Period of service as a volunteer.

The period of service of an individual as a volunteer includes any period of training under 22 U.S.C. 2507(a) before

enrollment as a volunteer and the period between enrollment as a volunteer and the termination of service as a volunteer by the President or by death or resignation.

§ 10.605 Conditions of coverage while serving outside the United States and the District of Columbia.

(a) Any injury suffered by a volunteer during any time when the volunteer is located abroad shall be presumed to have been sustained in the performance of duty and any disease or illness contracted during such time shall be presumed to be proximately caused by the employment, except the presumption will be rebutted by evidence that:

(1) The injury or disease or illness was caused by the volunteer's willful misconduct, intent to bring about the injury or death of self or another, or was proximately caused by the intoxication by alcohol or illegal drugs of the injured volunteer; or

(2) The disease or illness is shown to have pre-existed the period of service abroad; or

(3) The disease or illness or condition claimed is either a manifestation of symptoms of or consequent to a pre-existing congenital defect or abnormality.

(b) If an injury is not presumed to have been sustained in the performance of duty as provided by paragraph (a) of this section, the volunteer has the burden of proving by the submission of substantial and probative evidence that the injury was sustained in the performance of duty with the Peace Corps.

(c) If a disease or illness or claimed condition, or episode thereof, comes within exception paragraph (a)(2) or (a)(3) of this section, the volunteer has the burden of proving by the submission of substantial, probative and reasoned medical evidence that it was proximately caused by the factors of conditions of Peace Corps service, or that the condition was materially aggravated, or accelerated or precipitated by factors of Peace Corps Service.