H.R. 9869: FECA Modernization and Cost Containment Act of 2026

This bill would change how medical care is provided to injured federal workers under the Federal Employees’ Compensation Act (FECA). Its main goal is to move most care into managed care networks contracted by federal agencies, with the stated aims of lowering costs, improving coordination of care, and reducing fraud.

What changes for injured federal employees

• In most cases, an injured federal employee would be required to get treatment through the agency’s contracted managed care network.
• The main exception would be medical emergencies.
• If the network cannot provide a prescribed or recommended service, supply, or appliance, the employee could choose an outside provider.
• If the employee disagrees with a diagnosis or treatment recommendation from the network’s provider, the network would have to provide a second opinion from a different provider.
• The bill also creates a formal dispute-resolution process to help ensure employees receive needed services in a timely way.

What federal agencies would have to do

• Each federal agency would have to contract with a managed care network to provide medical services, appliances, and supplies for injured employees.
• Agencies would need to submit a transition plan within one year describing how they will switch to this system.
• The Department of Labor would have to issue regulations within six months to implement the new rules.

Rules for the managed care networks

• Managed care networks would have to make reasonable efforts to provide covered services and supplies.
• They would have to follow standardized treatment protocols set by the Secretary of Labor, based on healthcare best practices.
• They could not charge more than the federal fee schedule allows.
• They would need to have enough providers located reasonably close to each worksite.
• They would have to regularly evaluate providers for performance and cost-effectiveness, and remove providers when appropriate.
• They would have to submit annual reports to agencies showing estimated cost savings, provider performance, and anonymized patient outcome data.

Oversight and fraud prevention

• The bill would create a 16-member review board made up of Labor Department representatives, another agency representative, employee representatives, managed care network representatives, and provider representatives.
• This board would monitor network compliance, rate negotiations, and provider performance, and could suggest improvements.
• The Department of Labor could also contract with outside entities to review claims and flag potentially fraudulent claims using predictive analytics, including artificial intelligence tools.

Review and timing

• The new FECA changes would take effect one year after enactment.
• The Labor Department would have to issue implementing regulations within six months.
• GAO would have to report to Congress on the effects of the changes, including their impact on costs, fraud reduction, and administrative efficiency, after the law has been in effect for several years.

Relevant Companies

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