Many overseas federal contractors are covered by the Defense Base Act (DBA), which mandates that they provide workers compensation insurance for their employees. As the U.S. military has increased operations in Iraq, the size of the DBA program has grown, and in 2007 over $170 million in cash and medical benefits were paid to nearly 12,000 DBA claimants who were injured or killed while working under contract to the federal government. Congress has become increasingly concerned with the costs involved in the DBA program because the federal government usually reimburses its contractors for their DBA premiums. The Department of State (DOS) and the U.S. Agency for International Development (USAID) have seen some cost savings since adopting a single-source model for their DBA insurance in which contractors for each agency are required to purchase insurance from a single company selected by the agency. The U.S. Army Corps of Engineers (USACE) is currently testing such a model for its DBA system. For the rest of the Department of Defense (DOD), however, including the Army's large Logistics Civil Augmentation Program (LOGCAP) contract, individual contractors are free to select their own DBA insurers and negotiate their own rates.

Many overseas federal contractors are covered by the Defense Base Act (DBA), which mandates that they provide workers' compensation insurance for their employees. As the U.S. military has increased operations in Iraq, the size of the DBA program has grown. Since September 2001, there have been 49,472 DBA cases, including 1,584 cases involving the deaths of contractors in Iraq and Afghanistan. Nearly $200 million in cash and medical benefits were paid to DBA claimants in 2008. Congress has become increasingly concerned with the costs involved in the DBA program because the federal government usually reimburses its contractors for their DBA premiums. The Department of State (DOS) and the U.S. Agency for International Development (USAID) have seen some cost savings since adopting single-source models for their DBA insurance in which contractors for each agency are required to purchase insurance from a single company selected by the agency. The U.S. Army Corps of Engineers (USACE) is currently testing such a model for its DBA system. For the rest of the Department of Defense (DOD), however, including the Army's large Logistics Civil Augmentation Program (LOGCAP) contract, individual contractors are free to select their own DBA insurers and negotiate their own rates, and one contractor, KBR, has been criticized by DOD auditors for failing to demonstrate that it sought to control DBA premium costs when selecting an insurer. The Duncan Hunter National Defense Authorization Act (NDAA) for FY2009 (P.L. 110-417) includes a provision that requires DOD to change the way its contractors provide DBA coverage for their workers. In a report issued pursuant to this legislation, DOD concluded that making improvements to the current open-market DBA insurance system would best meet the criteria for reform recommended by Congress and the agency.

Many overseas federal contractors are covered by the Defense Base Act (DBA), which mandates that they provide workers' compensation insurance for their employees. As the U.S. military has increased operations in Iraq, the size of the DBA program has grown. Since September 2001, there have been 49,472 DBA cases, including 1,584 cases involving the deaths of contractors in Iraq and Afghanistan. Nearly $200 million in cash and medical benefits were paid to DBA claimants in 2008. Congress has become increasingly concerned with the costs involved in the DBA program because the federal government usually reimburses its contractors for their DBA premiums. The Department of State (DOS) and the U.S. Agency for International Development (USAID) have seen some cost savings since adopting single-source models for their DBA insurance in which contractors for each agency are required to purchase insurance from a single company selected by the agency. The U.S. Army Corps of Engineers (USACE) is currently testing such a model for its DBA system. For the rest of the Department of Defense (DOD), however, including the Army's large Logistics Civil Augmentation Program (LOGCAP) contract, individual contractors are free to select their own DBA insurers and negotiate their own rates, and one contractor, KBR, has been criticized by DOD auditors for failing to demonstrate that it sought to control DBA premium costs when selecting an insurer. The Duncan Hunter National Defense Authorization Act (NDAA) for FY2009 (P.L. 110-417) includes a provision that requires DOD to change the way its contractors provide DBA coverage for their workers. In a report issued pursuant to this legislation, DOD concluded that making improvements to the current open-market DBA insurance system would best meet the criteria for reform recommended by Congress and the agency.

In 2003, just before the start of the US invasion of Iraq, military planners predicted that the mission’s success would depend on using diverse sources for their workforce. While thousands of US troops were needed to secure victory in the field, large numbers of civilian contractors – many from poor countries in Africa and Asia – were recruited to provide a range of services for the occupying forces. In Contract Workers, Risk, and the War in Iraq Kevin Thomas provides a compelling account of the recruitment of Sierra Leonean workers and their reasons for embracing the risks of migration. In recent years US military bases have outsourced contracts for services to private military corporations who recruit and capitalize on cheaper low-skilled workers. Thomas argues that for people from post-conflict countries such as Sierra Leone, where there are high levels of poverty and acute unemployment, the opportunity to improve their situation outweighs the risk of migration to war-torn Iraq. Examining migrants’ experiences in their native country, at US bases, and after their return to Sierra Leone, Thomas deftly explores the intricate dynamics of risk, sets up a theoretical framework for future researchers, and offers policy recommendations for decision-makers and practitioners in the field. Incorporating the voices of Sierra Leonean contractors who were manipulated and exploited, Contract Workers, Risk, and the War in Iraq turns the spotlight on a subject that has remained on the periphery of history and reveals an unexpected consequence of the War on Terror.

This report provides an overview of the federal procurement and appropriations laws governing interagency contracting. "Interagency contracting" is the term used to describe several procurement relationships between government agencies.