Synopsis: Dysfunction Defined--IL SB 904 Will Create Workers’ Comp Legal Havoc and Lots More Litigation. How About An Alternative??? Thoughts, Comments and Opinions by Gene Keefe, J.D.
Editor’s comment: IL SB 904 is unusual and unprecedented IL WC legislation that may be coming at the IL WC community in about sixty-seventy days during the fall veto session of our legislature. Sponsored by ISMS, the dual goal appears to be getting doctors, hospitals and other caregivers the ability to sue in Circuit Court to collect both unpaid medical bills and statutory interest of 1% per month on unpaid bills. Governor Bruce Rauner provided an amendatory veto that would alter the basic model of having work comp claims decided in two venues and bring all WC claims back to the IWCC.
Please note I always want doctors and hospitals to be paid in a timely fashion and in the accurate amounts when properly coded medical bills are presented to a self-insured employer or insurance carrier. In this day and age, I am sure it is amazingly hard to believe how few doctors and other medical vendors can provide properly coded medical billing. I do feel most hospitals do a much better job of handling, coding and collecting medical bills.
Let’s look at Dysfunction Defined in IL WC.
Starting around 1909 after the Cherry Mine Disaster which left thousands of widows and children, the IL legislature, in its wisdom crafted the first workers’ comp bill in this State’s history. For the most part and with very few exceptions, all workers’ comp issues are adjudicated by a State agency specifically created and exclusively managed for the sole purpose of adjudicating workers’ comp benefits.
Please note if you analyze the tri-partite benefits under all workers’ compensation systems in the history of this planet, we are looking at medical costs and care as the number one WC benefit to injured workers. Lost time replacement benefits and permanency/impairment awards/settlements are usually the next two WC benefits in terms of costs and importance. IL SB 904 would therefore unquestionably split adjudication of the number one WC benefit into two separate venues—the Circuit Courts across the 102 counties of this State and the IL WC Commission which also holds hearings in numerous locations.
Please also remember the adjudication of workers’ comp benefits at the IWCC is tightly controlled at all levels—Petitioner attorneys cannot charge whatever they decide as hourly rates to handle WC claims. Their compensation is generally limited to 20% of whatever benefits might be in dispute.
Under IL SB 904, there are no limits on what attorneys might charge to represent their clients in the Circuit Courts. I am also certain there are court costs and other levies attendant to all Illinois litigation. As you read this, the IWCC does not charge any fees or other levies to reimburse the State for what is spends on hearing officers, court calls, computer tracking/storage and other related costs. Those costs are paid from levies on Illinois employers.
Similarly medical bills presented for care under the IL WC Act are tightly controlled—there is the ever-changing IL WC Medical Fee Schedule that greatly cuts what might otherwise be due or paid under the appropriate CRT medical billing codes. Lots of doctors and others complain about how low some of the WC medical reimbursements have become but the important thing to remember is a WC medical bill is not the same a what you might be charged by a plastic surgeon or other healthcare giver not constrained by IL WC law.
What Do You Mean Attorneys’ Fees Will Be Needed for Lots of Parties in WC Circuit Court Collection Claims?
I don’t believe ISMIS and the others lobbying for SB 904 looked at the whole enchilada, baby. In my humble view, when work comp-related medical bills go unpaid and the medical caregiver wants their dough plus statutory interest, there is going to have to be a judicial finding the claim is “workers’ comp.” Before a Circuit Court judge could make such a determination, they would have to have all relevant parties in front of them to be subject to the Court’s final ruling. The relevant parties would be the
Party seeking collection—the doctor, hospital or other medical vendor;
The injured worker;
The employer for the injured worker and
The WC insurance carrier or TPA (third party administrator).
Please note the determination a workers’ comp medical bill is due and owing would require the judge to make a binding determination—the matter has to truly be “workers’ compensation.” To make that decision, preliminary issues would include the Court having to make findings as to jurisdiction, employer-employee status, accident arising out of and in the course of employment and causal connection. It is also possible the judge would have to determine the bills are reasonable, necessary and related. The judge would also have to be presented accurately coded bills that comply with the IL WC Medical Fee Schedule.
Please note all of the above decisions might and could be made long before Claimant might later file an Application for Adjustment of Claim at the IWCC. That said, the Circuit Court’s determination would be res judicata or under what is also called “issue preclusion,” the Circuit Court judge’s ruling would be at least a preliminary ruling that would unquestionably impact all other issues in the IL WC claim.
The “binding determination” I mention above might not be simple at all. I think the drafters and supporters of IL WC SB 904 think everyone gets injured in front of five nuns and six rabbis and there are never any questions about compensability. To the contrary, many IL WC claims have obvious issues and concerns and run the gamut from reliable to fraud-laced.
Please also remember starting the IL WC process in Circuit Court opens up a can of litigation worms like discovery, motion practice, appeals and whatever. Our courts aren’t always rapid and smooth—that is why we have courts.
Either way, if SB 904 gets past the Governor’s amendatory veto, a sweeping new sort of litigation will hit our Circuit Courts. Lots of new litigation over WC-related medical bills could be brought shortly after the care is provided and this is going to bring lots of injured workers, their employers and insurance carriers into our Courts. In my view, if a worker is sued by their doctor for an unpaid medical bill, the worker is going to need an attorney at their own expense to avoid getting defaulted or their work injury claim denied without a hearing.
How Do We Fix This Mess? Please look to the IN WC System!!!
Our amazing law partner Kevin Boyle confirms IN WC gives doctors and hospitals a say and, most important, legal standing before their IN WC Board to fight for payment of unpaid medical bills. Claimant is left out of the process.
The important thing to me is the whole issue is resolved rapidly under their WC system and NOT in the Circuit Court.
This IWCB link has all the info, with links to the procedures, rules, too:
I appreciate your thoughts and comments. Please post them on our award-winning blog.
Synopsis: Shocking New Indiana Court of Appeals case: No CGL Coverage Owed for Employee’s Electric Shock Injury. Article and analysis by our IN WC Defense Team Leader, Kevin Boyle, J.D.
Editor’s comment: The Indiana Court of Appeals just issued an interesting Memorandum Decision relevant to worker’s compensation claims in Smith v. Progressive Southeastern Insurance Co., Case No. 18A-PL-340, published 08/31/2018.
Smith worked for Skelton’s tree-trimming business for many years. Skelton provided all tools and work apparel for about $10/hr in cash. He periodically worked 30 hours/week with no overtime, no income taxes were withheld, and no 1099 was ever completed.
Smith cut down a tree by himself that struck an electric wire on a nearby utility pole, knocking the wire to the ground. Smith called Skelton about it, and Skelton drove to the scene with his bucket truck and 65-foot boom. Both men got into the bucket of the truck to fix the situation, Smith grabbed the wire, and ZAP: he sustained serious injuries and was in hospitals for a couple months.
Skelton’s CGL carrier filed a declaratory judgment to determine whether it owed coverage for Smith’s accident. The CGL policy excluded coverage for any worker’s compensation claims, injuries to employees arising out of and in the course of employment, with certain Auto and other exclusions potentially relevant to the incident.
The trial court granted summary judgment for the carrier that no coverage was owed for Smith’s accident, and the Court of Appeals affirmed. The Court of Appeals held that Smith was employed by Skelton and that there was a causal nexus between his employment and his activities when injured. Smith wasn’t in the bucket or trying to fix the broken wire for person reasons. His injuries were born out of a risk incidental to the employment, and they occurred in the course of that employment. Broken wires tend to occur during this type of work and Skelton had previously broken wires before, too. The policy language that excluded coverage for employees and for obligations arising under the workers’ compensation law were both applicable here.
Also, the Auto coverage exclusion applied because the bucket truck qualified as an “auto” and the truck’s use was the cause of Smith’s injuries. Finally, the policy was not void as against public policy, too. It did not provide illusory coverage.
If you’d like a copy of the opinion, please email me: email@example.com. Please be aware that technically, pursuant to Indiana Appellate Rule 65(D), this Memorandum Decision should not yet be regarded as precedent or cited before any court except for the purpose of establishing the defense of res judicata, collateral estoppel, or the law of the case.