Comment on FR Doc # E7-18205

Comments from Marine Corps Community Services NAF Claims Program Manager Pertaining to the Federal Register, Vol. 72, No 181, pages 53424 - 53426, of Wed 19 Sep 2007 From the New Proposed Changes to Procedures for Processing Claims Involving NAF Activities, including the MC : In 765.4 Responsibility - TCU Norfolk has primary responsibility for negotiation and settlement of NAFI claims because - 1. NAFI's are Federal Agencies, and 2. the NAFI is charged with an essential function of the DoN, and 3. the degree of control and supervision by the Navy is more than casual or perfunctory. 1. Given the definition of "casual" as cursory, and "perfunctory" as superficial - it could be argued that number three above does not apply and refutes the premise that TCU Norfolk has primary responsibility for negotiation and settlement of Marine Corps NAFI claims, since the degree of control and supervision by the Navy over the MC Personal & Family Readiness Division's (P&FRD) Composite Insurance Program (CIP) is not more than cursory or superficial. 2. The above contention fails to recognize that Commercial Insurance Companies have written property and liability insurance policies to protect the assets of the NAF activity i.e. P&FRD. 3. Because of item number 2 above, underwriters may - if coverage is triggered under their insurance policy - will find that their insurance company has a financial interest in the adjudication and settlement of a potential claim filed against them, which is on behalf of the P&FRD. Further, every insurance policy has an Self- Insured Retention (S.I.R.) or deductible amount that the insured is responsible for paying before the commercial insurance company pays on the claim. It is our position that coordination with the insured is required of the TCU Norfolk on the settlement and negotiated payment of a claim - no matter how small the amount, since the NAF S.I.R. obligation begins on the claim from the first NAF dollar we pay from our Self-Insured Composite Insurance Program (CIP). 4. If commercial insurance was purchased by the CIP to protect the NAF assets that belong to MCCS and P&FRD, then the United States is not ultimately liable for payment of NAFI claims - depending on the size and type of claim filed. Also, the United States is only the Successor in Interest for the payment of NAF claims in a worst case scenario. Since the chance of our defaulting on the payment of claims is entirely remote, it is unlikely the Treasurer of the United States will ever have that responsibility of becoming the Successor in Interest for the payment of our NAF claims. In 756.6 - Negotiation. (b.) When the NAFI is insured, the insurer or TPA "will normally conduct negotiations with claimants". "Any dissatisfaction with the insurer's or TPA's handling of the negotiations should be referred directly to the JAG (Claims and Tort Litigation) for appropriate action. Question: What constitutes "any dissatisfaction", or how is that defined? Also in 756.6 (b) it is stated that "Concurrence by the insurer or TPA in the amount of the settlement is not necessary." Such a position invites litigation against the NAFI - by an insurer, and possibly the refusal of coverage on the part of that insurer to pay and settle a claim on behalf of the P&FRD. Also, failure to report timely notice of potential claims, to all commercial insurance companies, can void the insurance coverage and the payment of claims on our behalf, by those insurers. Also, this proposed change does not address the fact that P&FRD does handle and review in-house all tort claims that are filed, as opposed to contracting for TPA claims services. Financial interest of a claim is resident with the NAFI and / or the commercial insurance carrier. Failure to coordinate settlement with the NAFI and / or the carrier is unacceptable. In 756.6 (c) when the NAFI is not insured, "that TCU Norfolk is responsible for settlement negotiations. When the appropriate settlement is negotiated by the Navy, the recommended award will be forwarded to the NAFI for payment from NAF funds." That it appears from the above that the NAFI is not consulted concerning the appropriateness of the settlement amount prior to the settlement agreement being finalized between the TCU Norfolk and the claimant. As indicated above - all opportunities to obligate NAF funds must be coordinated with the NAFI. To reiterate - the critical point mentioned above - does an APF agency have the authority to obligate the expenditure of budgeted NAF funds? In 756.9 - Claims by Employees: Suggested rewording for 756.9 (b): "Provisions of the Longshore and Harbor Workers' Compensation Act are extended through the Nonappropriated Fund Instrumentalities Act (S. 1828) for civilian employees of NAFI's who are compensated from nonappropriated funds who have suffered injury or death arising out of their employment. In the last sentence of same paragraph, do not agree with the wording. It give the impression that you can elect NOT to file a claim unless there is "substantial possibility, etc." - truth is, anytime an employee alleges an injury/illness, a claim must be filed regardless whether anyone else thinks there isn't any way this happened at work. Suggest instead.... "Claims should be made under that Act if the employee, or his dependents in the case of death, allege the injury or death is covered under the Act's provisions." Suggest rewording for 756.9 (b) (2): "Employees who are not citizens or permanent residents of the United States or a Territory, and who are employed outside the continental United States, will be provided compensation in accordance with the regulations prescribed by the Secretary of the military department concerned and approved by the Secretary of Defense or regulations prescribed by the Secretary of the Treasury, as the case may be. (this part is straight out of the NAFI Act.) Commercial insurance coverage for this type of employee is not required, but may be purchased at the discretion of the NAFI." The wording "other arrangements" is too vague and should be defined. Lastly, the reference to a BUPERSINST should not be included in 756.9(2).