Workers Compensation "Reform"

iStock_000000623974XSmallMuch was made in the last session of the Illinois legislature's attempt to pass "workers' compensation reform" bills.

It is made to sound like an economic necessity, but what the public doesn't realize is how ultimately mean spirited and potential far-reaching such attempts may be.

The John Cullerton-sponsored Senate Bill 1066 (for those of you who are history buffs, you may insert your own clever "Norman Conquest" line here) never actually got called for a vote, yet caused much consternation throughout the State of Illinois and continues to do so, both within the workers' compensation community and outside of it. As I will attempt to explain below, this legislation could affect everyone from workers (obviously), to employers (and not in the ways you would think), to doctors (surprised?).

First of all, let me preface this by stating that I am a petitioner's lawyer and that I am a plaintiff's lawyer in my non-workers' compensation cases. Most of my practice involves personal injury and a smaller segment involves injured workers. However, much like the continued attempts by various groups to push tort "reform" through within the last several decades, it appears that the alleged crises that are being reformed may not actually exist. There appear to be ulterior motives for much of this legislation. It sounds reasonable until you really give it a better look and pull back the curtain to see what the flimsy bases of the "need to reform" really are. So, while I am stating my opinion, I also hope to shed some light upon some of the misconceptions that may be out there.

The first main tenet of the reform effort is the modification of the Medical Fee Schedule. In Illinois, workers' compensation medical bills are paid pursuant to a schedule. Without getting too technical, it works similar to how health insurance has percentages of actual bills that they pay. One of the alleged reasons posited for the need to cut the fee schedule is the rising cost of medical benefits. The problem is that insurance companies, for obvious reasons, will not release the actual amounts they spend on medical benefits. Thus, while they might pay $50,000.00 in bills for a rotator cuff surgery for an injured worker of an employer they insure, we don't know exactly what percentage of that $50,000.00 they actually pay after setting off for contracts and exclusive deals with various providers. Without this information, it is hard to know whether medical costs are really "going up" as has been stated as fact (if this sounds similar to the reasons given for tort reform, your are seeing a pattern). Add to that the fact that non-medical expenses, such as nurse case managers, are included in the medical costs expended upon a workers' compensation claim. Needless to say, the insurance industry will not share these figures with the public or the legislators and we remain at loggerheads as compromise on something without factual basis does not seem to be in the best interests of workers or doctors.

Another tenet of the workers' compensation reform effort is the use and implementation of the AMA guidelines. Simply stated, this would utilize American Medical Association guidelines for rating disabilities. The big question that is not answered is how would they be used? Would these be the exclusive rating of an injury? In other words, would one doctor decide on a percentage or would it be a team of doctors? Would it be binding or could a worker and employer still present arguments before the Illinois Workers' Compensation Commission to tweak these? Nobody seems to know the answer which should be scary enough.

But wait, it gets worse! There are well-recognized cultural biases inherent in the 6th edition of the AMA Guidelines so obvious that several states (including Iowa) have opted not to use that edition and stick with the older 5th edition. Further, there are literally almost two dozen states that don't use these at all and the anecdotal evidence is that costs for insurers and employers are well-contained. So, it begs the question of what exactly is behind the push for use of these guidelines. It certainly appears to be either anti-worker or anti-attorney. One thing the current system leaves us with is a bit of unpredictability. We don't know exactly what award will be given by which arbitrator and so, the award given for the same injury may vary from arbitrator to arbitrator. While businesses (employers) would love to lock in and predict their expenses, it seems impossible to do this without first going back to the original problem and discovering just what the costs that we are trying to save are. Since we are unlikely to ever obtain that information, this "cost saving" rationale sure seems suspicious.

Another push in the legislation is to essentially eliminate aggravation of prior injuries and repetitive trauma from workers' compensation. Basically, the work injury would have to be the "primary cause" of the injury. But while that seems sensible enough, how exactly does this work with someone who works, gets hurt and injures his ankle and returns to work, only to later reinjure the ankle. Medical literature is pretty clear that many injuries to many areas of the body make one more susceptible to reinjury of that same area. To take this away seems capricious. This could affect as many as half of the cases in Illinois.

Next, there is a push within the proposed legislation to limit the employee's choice of doctor. Currently, the employee who is injured has an absolute right to choose his or her own medical treatment (and any two providers or referrals therefrom). The proposals would more or less allow the employer to send the injured worker to its choice of doctor (the company clinic). Without even getting into issues such as freedom, right to medical choice, and the like, this does seem inherently biased against the worker when the clinic is assuming that the faster that worker is returned to work the more "referrals" will come its way.

A huge potential issue is Utilization Review. I will try to break this down to an understandable level, although it is not easy to do. This is a push by insurance companies to use primarily out of state evaluations by doctors as the main basis of the valuation of claims. The proposed legislation would make these reports essentially the dominant tie breaker between the employer's doctor and the employee's doctor. In other words, let's say Joe works at a car wash and injures his back. His doctor recommends surgery so the insurance company for the employer sends him to its choice of doctor, who opines that he does not need surgery and can return to work. The proposed legislation would allow Joe's records to be sent to some other doctor (most likely out of state and not necessarily even practicing in that area of medicine), who would in turn generate a report on Joe's medical future. That's right; a stranger who never meets Joe and can never be cross examined by his lawyer, makes a decision about Joe's health and working life.

What should set off red alerts for all is the fact that this particular proposal has actuall brought together unions, trial lawyers, and .....DOCTORS! Yes, when unions and doctors are on the same side it does make one wonder just what is going on. In this case, insurance companies have long used "Independent" Medical Exams, wherein injuried workers are sent to "independent" doctors (who are paid by the insurance companies) to provide opinions on the medical situation of the injured worker, whose own doctor has invariably proposed treatment the employer's carrier does not want to pay for. This system, while flawed, has allowed many doctors to make quite a nice regular income for these "independent" evaluations. What could happen with Utilization Reviews is that you could potentially wind up cutting out the IME doctors and using doctors who are not only out of state and disinterested but potentially off shore. Once the doctors discovered what could happen, they began to take an interest in the proposed reform efforts.

Last, there is a seemingly half-hearted proposal to bar workers' compensation recovery if any alcohol or drugs are involved. Keep in mind, this would not just affect the fork lift driver who tips over because he drank his lunch but also the business executive who has a glass of wine at lunch with his client and gets rear-ended by another car driving back to the courthouse hours later when he gets the call that the jury has come back with a verdict. There are endless examples of drug or alcohol preventing legitimate injuries from being compensated. Add to this the fact that alcohol, drugs, and other forms of alleged workers' comp fraud are a very small, insignificant part of the cost of workers' compensation in Illnois. In fact, the general cost for workers' comp insurance is about 20 cents an hour. It turns out that workers' comp costs are actually lower in real adjusted dollars than they were over a decade ago. Much lower. About half as much.

So if cost is not a "real" factor in this reform effort what is? It seems to be a plethora of horse-trading, political machinations, based upon the faulty premise that there is a need to "keep businesses from leaving Illinois" and to "cut the cost of workers' comp and the cost of doing business."

Much like the tort reform efforts, the premise posited as justificaton for the need to "reform" is spurious, faulty, and a red herring. Much like the tort reform efforts, many interests are at stake to push for or against the proposed legislation. It remains to be seen what, if anything, will occur. What is certain is that it potentially affects every worker in Illinois, thousands of employers, thousands of lawyers, doctors, and dozens of insurance companies.

I invite anyone to take a peek at some of the proposals in the reform effort. If you think it might affect you, get involved.

As always, if you have any questions about an Illinois or Chicago-area Workers' Compensation or Illinois or Chicago-ara Personal Injury case, please call 773-944-9737.

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