1. Full Replacement Value & Claims J.D. REESE Chief, Air Force Claims Service Center Air Force Claims and Tort Litigation Dayton, OH

2. DoD “Personnel Claims” What is Our Authority? Authority to Pay Claims – Military Personnel and Civilian Employees’ Claims Act: 31 USC 3721 (aka PCA) – Each Service’s Claims Directives – Service Agreements w/ Industry (e.g., ALDG) Authority to Recover from TSPs – Fed’l Claims Collection Act: 31 USC 3711-3720E – Each Service’s Claims Directive – Service Agreements w/ Industry (50/50 refund requests)

3. Personnel Claims Claims Service “At a Glance” Different Business Models for Payments and Recovery – Decentralized: Army payment, semi-centralized recovery – Regional: Navy/MC, regionalized payment and centralized recovery – Centralized: AF payment and recovery operations centralized in Dayton, OH

4. Air Force Personnel Claims Structure Air Force Claims and Tort Litigation Division (AFLOA/JACC) – Under command of AFLOA/CC – Six Claims Branches: Aviation/Admiralty, Medical, Foreign Claims, General Torts, Medical Cost Recovery, Claims Service Center Air Force Claims Service Center (AFLOA/JACC-CSC) – Dayton, OH – Opened Mar 07 w/ 108 personnel 81 active duty 27 civilians – Reorganized to 31 civilians due to FRV

5. Air Force Claims Points of Contact Air Force Claims Service Center – 1050 Forrer Blvd, Dayton OH 45420 – DSN 986-8044 or (937) 656-8044 – 1-877-754-1212 (toll free) – Email: AFCSC.JA@wpafb.af.milAFCSC.JA@wpafb.af.mil

6. AFCSC Operations Online claims submittal: – https://claims.jag.af.mil https://claims.jag.af.mil Email to organizational box: – We’ll manually input into our system Fax to AFCSC – We’ll manually input into our system USPS (Uncle Sam’s Postal Service) – We’ll manually input into our system

7. AFCSC Stats Pre & Post FRV FY10 YTD, the CSC settled 2,319 claims in avg of 4.19 days with a 96% asserted v. collected (AVC) rate for CRs FY09, the CSC settled 3,760 claims in avg of 3.85 days with a 92% asserted v. collected (AVC) rate for CRs FY08, the CSC settled 9,685 claims in avg of 3.75 days, 95% AVC FY07, the CSC settled 8,397 claims in avg of 10 days, 95% AVC Historical rates (prior to CSC standup): – FY06 – 16,224 claims, 90% w/in 8.3 days, 86.1% AVC – FY05 – 18,377 claims, 90% w/in 5.1 days, 84.7% AVC – FY04 – 18,846 claims, 90% w/in 5.1 days, 84.5% AVC – FY03 – 20,051 claims, 90% w/in 4.7 days, 85.3% AVC – FY02 – 22,235 claims, 90% w/in 4.7 days, 83.6% AVC – FY01 – 24,912 claims, 90% w/in 5.3 days, 82% AVC

8. Living in an FRV/DP3-World Massive shift in focus as claimants must settle directly with TSPs under DP3 – 90%-95% of HHG claims will not be settled directly by DoD claims offices – Caring for Airmen will continue via indirect methods (e.g., call center advising on DP3 system—CSC answered avg of 57 calls per day 1 Jan 09-present)

9. Everything you wanted to know about FRV (but were afraid to ask!) Began Oct/Nov 2007 Members encouraged to file directly with TSPs w/ in 9 months of delivery Can transfer to service if not satisfied w/ TSP’s offer Can file directly w/ service, but must sign waiver— depreciated value only! Customer satisfaction? We’re not sure! – Haven’t heard from anyone who really likes it – Hear fairly frequently from those who really don’t – A large majority we don’t hear from at all Either they’re satisfied, or They’re tired of getting beat into the ground and just give up!

10. FRV Continued… Carrier pays Full Replacement Value Carrier liability is $4 per lb times net shipment wt, but not more than $50K Max liability is $5K even if shipment wt less than 1250 lbs Carrier inspects, responsible to set up repairs Can replace with like item

11. FRV Brave New World Experience with FRV claims reveals “gap” in ability of claimants to receive FRV. Claimants cannot get FRV when TSP not liable for loss and damage FRV paid to members in limited situations: – Acts of God – Losses at sea – Multiple TSP handlers FRV “Gap” legislation enacted 7 Jan 11

12. FRV Brave New World Cont… Numbers down very significantly Does this mean “business” is less for DoD Claims offices and personnel? Increasing assistance to claimants in dealing with TSPs and in working DPS issues Mediation Offices now documenting effort to reflect changing personnel utilization – to quantify work so to reflect different quality of effort Always looking at adjusting system

13. Offsets Service claims organizations collect from TSPs not only by negotiation/check deposits, but also offsets HHG loss/damage claims arising out of DPMs also can lead to offsets No offset capability for military claims services now $250k backlog; other Claims Services have same issue Powertrack issues with HHG claims offset function E-bill in Lieu of Offsets proposal Status of EILO???? Upshot: unsatisfactory for Claims Services

14. The Future… Direct settlement has changed the landscape No going back Offset issue must be solved! Claims services adjusting to the different work Clear skies ahead??