4-30-2018; IL WC Medical Providers Can’t Directly Sue IL Insurers/Insureds for Interest on Delayed-Paid Medical Bills; More Goofy IL WC Legislation--Don't Worry About It and more

Synopsis: IL WC Medical Providers Can’t Directly Sue IL Insurers/Insureds for Statutory Interest on Unpaid or Delayed-Paid Medical Bills.

Editor’s comment: In my opinion, this medical provider and their counsel have been legally aggressive in seeking payment of their billing. I feel certain they saw the legislative provision in the 2011 Amendments to the IL WC Act that provided for 1% per month or 12% per year on unpaid medical bills to be an entry path to getting increases to delayed and unpaid medical billing. If such an avenue was present, we feel all the doctors, hospitals and other medical caregivers in this State would have considered similar collection pathways.

It is the Workers’ Compensation Act; Not the Doctor’s Compensation Act.

The problem I feel many medical providers have is a lack of strong interest from Claimant attorneys to insure the medical caregivers are not only paid the correct amounts for their billing but also paid timely. There is an interesting issue present about the ethical duties of the Claimant attorney to insure the medical providers get everything they are entitled to—I feel such attorneys work to their client’s best interests and aren’t strongly interested in helping doctors and hospitals. The injured worker and their attorneys do their best for the medical caregivers but that doesn’t always insure full and timely payment occurs.

There is another problem when doctors, hospitals and other caregivers run up huge bills, either due to overbilling for services or over-servicing a patient. In such settings, Claimant attorneys don’t feel particularly happy to be turned into a collection attorney with a treater that may not fully cooperate with collections efforts. If the treater has to come to the IWCC to testify, they may lose money because they aren’t treating.

IL Appellate Court Rejects $37,229 in Statutory Interest for Belated Payment of Medical Bills; Ruling Confirms Doctors and Hospitals Can’t Sue Insurer or Insured Directly.

The Illinois Appellate Court overturned an award of $37,229 in interest to two treatment providers for a work comp carrier’s late payment for services.

In Medicos Pain & Surgical Specialists v. Travelers Indemnity Co. of America, No. 1-16-2591, 04/26/2018, published. Claimant Mendoza worked for Blackhawk Steel Corp. After he suffered injuries in 2010, he received treatment from Medicos Pain & Surgical Specialists and the Ambulatory Surgical Care Facility. After waiting several years for payment for the services provided to Mendoza, Medicos and Ambulatory filed suit against the work comp insurance carrier, Traveler’s Insurance.

The Arbitrator determined medical services from both providers had been reasonable and necessary treatment for Mendoza’s injuries. When Claimant Mendoza received an award of permanent partial disability benefits, he remitted it to Medicos and Ambulatory Surgical Facility. The providers and Traveler’s proceeded to a bench trial in the Circuit Court on the providers’ entitlement to statutory interest for the time Defendant Travelers had not paid their bills.

The circuit court judge awarded Medicos and Ambulatory $37,229 in statutory interest, pursuant to Section 8.2(d) of the Workers’ Compensation Act. As I outline above, Section 8.2(d) of the IL WC Act states late payments to a medical service provider “shall incur interest at a rate of 1% per month payable to the provider.”

The Appellate Court confirmed the award of statutory interest was improper following its decision in Marque Medicos Fullerton v. Zurich American Insurance Co. In the earlier ruling, the Court explained a party can assert a right to be compensated for the violation of a statute only if a private right of action was authorized by the legislature. Section 8.2(d) does not expressly authorize a private right of action to collect interest, but the court’s decision said a private right of action could be implied for a plaintiff who is a member of the class for whose benefit the statute was enacted. Earlier ruling confirmed the purpose of Section 8.2(d) was to encourage the prompt payment of benefits to injured workers, not their treatment providers. However, the Court held treatment providers have no implied private right of action under the IL WC Act.

In this claim, the Court confirmed their earlier decision was controlling on these Plaintiff. Since the providers did not argue any grounds for reconsidering the analysis and holding in the earlier ruling, the Court declined to change it in any way.

Justice Robert Gordon who handled many IL WC claims with and against me during his illustrious career wrote a concurrence and agreed the award of interest could not stand, but he said he disagreed with the majority’s legal view. He opined the problem for doctor’s and other medical providers was not the absence of a private right of action, but rather the exclusive jurisdiction of the Workers’ Compensation Commission.

To read the decision, click here.

Synopsis: More Goofy IL Legislation in Workers’ Comp—Don’t Worry About It.

Editor’s comment: Last week, the Illinois House of Reps passed a bill that would again supposedly set up a tiny government insurer for the residual market.

I have repeatedly attacked this silliness and I promise not to stop. Illinois Republican Gov. Bruce Rauner vetoed a similar bill last year and is expected to do so again if HB 4595 makes it to his desk. We bet the IL Senate will wisely fuss around until after the November IL elections to see if the “other billionaire” or JB Pritzker might approve of this kooky idea.

The bill, sponsored by state Rep. Laura Fine, D-Glenview, passed the House 62-43 Thursday, but has not seen any action in the Senate.

The bill would create a public insurer to address the troubled market of last resort, for employers who can't obtain affordable workers' compensation insurance from commercial carriers. The bill would do this in part by requiring the IWCC to lend $10 million from the Workers' Compensation Commission operations fund to create the Illinois Employers Mutual Insurance Co. 

Understanding I am not shy about this one, my view is this concept is complete hogwash. Again, in my view, this is a total legislative PR push generated by the IL Trial Lawyers. Some obvious issues:

1.      The money is supposed to come from the IL WC Commission’s budget. The IL WC Commission has 150 workers or so and a $30M annual budget. How would they “lend” 1/3 of that money for this effort and not have to lay off staff? The use of the IWCC’s money for this odd purpose would impair hearings for seriously injured workers and other important IWCC actions.


2.      The money would create a truly tiny, almost miniscule state insurance carrier. Please note one of the insurance carriers listed in the next sentence is worth more than $33 billion dollars. The tiny State carrier would only have $10M in funds and then supposedly “compete” with multi-billion dollar international WC insurers like Travelers, Zurich, The Hartford and AIG.


3.      The impact of a $10M insurance carrier in relation to the multi-billion dollar giants of that business is not going to be statistically measurable.


IL Democrats have been stupidly claiming this is all about the major insurers “colluding” or getting together to raise WC premiums and not passing along savings to their customers. There are over 300 WC insurers in the IL WC insurance market—they strongly compete with each other to seek to provide the lowest possible premiums and grab all the business they can.


In short, draw your own “contusions.” If this bill becomes law, I would bet the money never moves as they claim and nothing will ever come of it—in short, this is legislative sleight-of-hand. You can worry about it but I bet your time is better used to make sure other more important things in your life are taken care of.


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