Significant cost reform exists in the oversight of the Defense Base Act (DBA) and War Hazards Compensation Act (WHCA). The Department of Defense (DoD) through prudent contracting can save billions in this area. DoD wartime contracts pay magnified DBA insurance premiums in which the insurance carriers load high rates based upon risks associated with war for contract services in places like Iraq and Afghanistan. Normally that makes sense, however, DBA insurance carriers concurrently receive full reimbursement for each war related injury or death resultant from war risk hazards in Iraq or Afghanistan, under the WHCA. As a result, DBA insurance carriers double dip. DBA insurance carriers receive a large payout through escalating premiums, under DoD services contracts, while also seeking reimbursement for war risk hazards through the Department of Labor (DOL). I have labeled this predicament the DBA “war risk syndrome.” This DBA war risk syndrome not only drives up high DBA insurance premiums but it benefits a DoD contractor’s payroll with G&A, fees and profit from higher DBA rates. As a result, DBA insurance carriers, brokers, and contractors profit inequitably. In this article, I propose that the federal government has an opportunity through contracting officers and a tighter oversight on WHCA payments to immediately achieve significant DoD cost savings and mitigate the DBA war risk syndrome.
|Advisor:||Tillipman, Jessica, Thornton, Karen|
|School:||The George Washington University|
|School Location:||United States -- District of Columbia|
|Source:||MAI 56/02M(E), Masters Abstracts International|
|Subjects:||Law, Military studies|
|Keywords:||Cost reform, DBA, Defense Base Act, Department of Defense, Department of Labor, War Hazards Compensation Act|
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