6-14-2011; Okay, Property-Casualty Insurers and Brokers, when are we going to go all out to attack tornados in the U.S.?

We share the grief of all the folks and families in Joplin, Missouri injured and killed in the recent tornado onslaught. Several of our clients flew in to pick up the pieces of business and lives lost. We hope the rebuilding process moves smoothly.

In the United States, spring storms and the billions of dollars in damage left behind were the result of a confluence of more violent weather hitting densely populated areas. Over a six-week period this spring, tornados ripped through Southeastern and Midwestern states flattening neighborhoods in large urban areas such as Raleigh, North Carolina, Tuscaloosa, Alabama and Joplin, Missouri. By the end of May 2011, tornados have already killed 365 people in the United States, a figure nearly six times higher than the three-year average of 64 deaths, according to the National Weather Service. Again, by the end of May, 1,151 tornados have occurred in the United States this year, nearing the 1,282 reported in all of 2010, but below the all-time high of 1,820 in 2004. In our view, with climate change almost certainly here to stay, we have to start to plan on more tornados and more devastation. Or do we?

Current estimates of P&C insurance losses peg the cost and insurance losses in the range of $10-20 billion. In our view, that is a lot of cash—couldn’t we invest some of it in stopping the cause and not simply keep ducking and then pick up the pieces? We have performed some web research and we remain amazed there is so little ongoing activity to aggressively counter or “stop” tornados. Understanding we have amazing computers and folks on the moon and seem to have progressed as a species a little over the last several centuries, it is hard to believe when it gets windy, we basically run for cover and hold on for dear life. Our vote is to start to raise money and attack!!

Please note there is a bit of a difference between tornadoes and hurricanes. The storms causing tornados are typically about 2-6 miles across. In contrast, hurricanes grow to be the size of the state of Texas. We may want to duck from hurricanes a little bit longer but we vote the government and private industry should start thinking about counter-attacking storms which cause tornados that are 2-6 miles across—we are sorry but we don’t think it can be that challenging.

While some might assume this idea to be an absurd one, we have checked it out. It turns out there is limited research devising ways to control the weather—particularly disastrous weather systems like tornados. There is an indication they hope to put their ideas to the test in the coming decades. Any storm depends on a host of complex, interrelated drivers, like heat flows and wind movements. The basic anti-storm strategy is to take the smallest of these factors, the one most amenable to change, and change it—in the manner, say, of throwing a wrench into a mill at a factory in hopes so disrupting one part of the system will cause the entire assembly line to shut down.

Yet disrupting storm systems may be harder than one would think. Here are a couple of our thoughts:

1.     Bring out the fans—what would it take to bring in and install gigantic movable fans around city centers where tornados are likely to strike? The goal wouldn’t be to stop the tornado, just slow it down and break it up so it didn’t kill people and destroy homes. We understand the need would be for lots of monster-sized fans but if tornados actually cause billions of dollars in damage and potentially kill thousands of Americans; how about spending $10 million on large movable fans to see what you could do?

2.     Baffle, baffle, baffle—we have two thoughts on building giant anti-tornado baffles.

a.     Plan A is to use garbage!! To our understanding America is trying to find places to put our refuse—why not build mini-mountains of garbage dumps to break up high wind? We have to do something with the stuff anyway—let’s put it to better use in tornado alleys.

b.    If that doesn’t work, it is our understanding tornados in the northern hemisphere all move one direction, why not build major league wooden or metal baffles that would block wind in that direction or even slow it down?

3.     Fry them--recent research indicates in order to form, a tornado needs both a cold, rainy downdraft and a warm updraft. To stop a tornado from forming, just heat the cold downdraft until it's cold no longer. And how would one do this, you ask? Simple: Blast it with beams of microwaves from a fleet of satellites. The satellites would collect solar energy, transform it into microwaves and send a carefully directed beam down to the storm on Earth. The beams would be focused on cold downdrafts, heating them like last night's leftovers. The European Space Agency has funded initial studies on building this type of satellite, though it hopes to use the satellites as high-altitude solar-power stations, not as weather modifiers. How do we get NASA involved in a down-to-earth problem?

Understanding government money is tight, we look to the efforts of P&C insurers to see if they care about what is happening right now and what we may see in the future. We appreciate your thoughts and comments.

6-14-2011; The Menard “Scandal” isn’t going to stop until someone stops it. While what is happening isn’t illegal, someone in government with a brain has to take a long, hard look at it

Our vote for everyone in the Illinois WC industry on all sides is to call your State Senator or Representative and let them know how thrilled you are to see the whole WC system being challenged and/or threatened due to hundreds of greedy prison guards, their claimant lawyers and willing surgeons. We are also less-than-thrilled to see Central Management Services do such a completely miserable job of managing claims by State of Illinois employees. This silliness has to stop and stop soon.

According to George Pawlaczyk and Beth Hundsdorfer of the Belleville News-Democrat 59 new workers’ compensation claims have been filed since January 2011 by employees at the southern Illinois prison in Menard, IL. Please note that number means more than 10% of the work force filed a claim in the first six months of this year. If you also aren’t sure, 56 of the 59 were filed by the same claimant lawyer who we are advised is sending all the workers to the same doctor.

Some claims involve alleged assaults by prisoners, but almost half allege repetitive strain injuries similar to previous cases under investigation, the News-Democrat reported. Noting the controversy about carpal tunnel syndrome claims, five of the new cases or just under 10% involve repetitive foot strain or “tarsal tunnel syndrome,” a condition workers are expected to claim is caused by walking or standing on the prison's concrete and cement floors. We wonder how prison guards at other facilities all over the nation and the world manage to make their rounds and keep the bad guys/gals behind bars without suffering from TTS. One has to wonder if anyone in Menard knows about Dr. Scholl’s© custom fitted orthotics and how they rapidly create a custom product in most drug stores to prevent foot problems—take a look on the web at: http://www.footmapping.com/footmapping/home/index.jspa.

In previous reports, the Belleville News-Democrat said Menard staffers claimed nearly $10 million in taxpayer dollars since January 2008 through workers' compensation. The majority of such claims were for carpal tunnel syndrome from locking and unlocking doors and driving prison trucks with supposedly shaky steering wheels. At present, more than ½ of all employees in the prison, including the warden, have made claims and either have received or will receive generous tax-free settlements.

More recently, the Belleville News-Democrat reported Freedom of Information Act disclosures confirmed the State of Illinois Central Management Services agency hired an hand expert from Missouri, paid him to perform an “investigation”, had him write a report when they clearly didn’t have to and they were then “forced” by the paper to disclose his report.

Not surprisingly, in the report, the expert found the work being performed “aggravated” the prison guards’ medical conditions. We remain furious to hear this expert and the experts who performed the prior job analysis in 2008 weren’t asked the obvious question a fifth-grader would ask—how do we stop this problem? In our view, the folks at Central Management Services had a single goal—justify, substantiate, validate, vindicate the millions in taxpayer money being thrown around. We are not amused by this obvious public relations tactic.

We assume CMS is now going to hire a foot expert to analyze the supposedly arduous walking of the prison guards and draft a detailed report indicating such work didn’t cause tarsal tunnel syndrome but it magically “aggravated” it to justify the thousands in medical bills, lost time and settlements CMS can be expected to shower on these state workers.

As veteran defense lawyers, we have never seen any WC defense organization spend the money and time to hire an expert to insure they LOSE claims. It boggles our collective minds to hear the State of Illinois did this.

In our view, John Q. Public will remain outraged about this situation and this great media outlet in Belleville is going to continue keep it in the headlines. As the State of Illinois and its universities have about 120,000 employees, if half of them file claims similar to what is happening at Menard, the cumulative cost may be in the billions.

We caution Illinois unions, the Illinois Trial Lawyers Association, our hearing officers and legislators, until this silliness is stopped; you are going to continue to hear from the major players on the defense side of the WC matrix calling for meaningful reform.

As we have advised our readers, no private employer in the entire United States:

·         Pays as much in workers’ compensation benefits on a per capita basis to their workers as the State of Illinois does—they admit they paid $133,000,000 in one year which exceeds the national WC budget for almost every United States employer.

·         Overworks its adjusters like the Central Management Services agency does; each CMS adjuster is expected to “handle” over 1,500 claims each—in the private sector, adjusters are completely swamped trying to handle a fifth that many claims. We consider it “penny-wise and pound-goofy” to save money by wildly overworking your claims handlers. As we outline above, why hire folks to knowingly lose thousands of WC claims??

·         Overworks its defense lawyers like the Attorney General’s office does—there is no chance, none that such lawyers can write proposed decisions following hearings; they simply have hundreds and hundreds of claims. Like the CMS adjusters, they are there to lose and lose and lose.

·         Pays as much in penalties and attorney’s fees—this means a state employee, the IWCC Arbitrator, is penalizing the decisions of another state employee, the CMS adjuster to the wild benefit of injured state workers and their lawyers; all to the detriment of taxpayers.

·         Takes literally no action of any kind to identify, stop or even slow the onslaught of workers’ compensation claims.

·         Pension-eligible state government workers who are adjudicated totally and permanently disabled retire at about 130-140% of their pay—they get both pension and T&P benefits without any offset. This costs the State of Illinois about $7M per year, every year.

We feel all of this mismanagement of State of Illinois WC claims poisons the private sector along with WC claims against other government entities who are fighting hard to properly reserve, handle, manage and aggressively defend their claims.

The article from the Belleville News-Democrat is on the web at: http://www.bnd.com/2011/06/12/1745319/menard-workers.html We appreciate your thought and comments. Please do not hesitate to post them on our award-winning blog at: http://keefe-law.com/kcablog.html

6-14-2011; It’s a belt-high fastball, folks—right over the middle of the plate. Are you ready to hit it?

Do you remember the scene in the movie Bull Durham® where Kevin Costner, as the catcher, tries to call a pitch and the pitcher keeps calling him off? Costner then calls time to talk to the pitcher and after returning from the mound he whispers to the batter to get ready for a fastball over the plate. The slugger, having been duly advised, smokes the ball over the fence. All the batter needed was a little bit of a warning on what was coming and when prepared, he clearly took advantage.

With that in mind, the current situation on Illinois workers’ compensation reform has us scratching our heads. While the Governor hasn’t signed it yet, our legislature has provided one of the biggest cost-savings in the century-old workers’ compensation system. Assuming the Governor signs it soon, and every indication is he will—is Illinois business ready to take advantage of your newly found advantage? Are you folks listening to what just happened and ready for it?

The biggest cost saver is the shift in medical coverage in the Illinois WC system. From an historical perspective, the supposed “limits” on choice of doctor by an employee in this state have actually been “unlimited.” By that we mean, for several decades, an Illinois employer was responsible to pay for the first choice of physician by an injured worker. Thereafter, the employer was also responsible to pay for any healthcare provider to which the initial choice of doctor referred the patient in a “chain of referrals”, allowing all healthcare providers to refer injured workers to new doctors, clinics and hospitals.

Does that sound pretty generous? Well, there is more. On top of the initial doctor and the chain of referral from that doctor, an injured worker could change their mind and then start all over again with another doctor and a new chain of referral flowing from that doctor!!! In our view, it was legalized doctor-shopping and lots of abuses flowed from the effectively unlimited Illinois double-chain-of-referral system.

Has this changed? Well, only if you are ready to step up to the plate and take advantage of the new 2011 Amendments to the Illinois Workers’ Compensation Act. If you don’t take affirmative action right now to change what you are offering your workers, you are going to remain in the “two-choice” medical choice program outlined above.

Moving your IL WC program so your employees will have one choice of doctor/chain of referral

Our vote is to cut one of the “chains” for your workers right now. If you want to cut out one choice of doctor, you have to offer a PPO for your workers. If you do this, you immediately supplant one of their choices with a WC medical care system of your own selection. Please don’t be confused, even with a PPO, injured Illinois workers still have one post-emergency choice and the chain of referral stemming from their initial choice.

However, if you provide a PPO for workers’ comp injuries after the Governor signs this new bill, you limit workers to only a single choice—the only other choice is your PPO. In our view, if you work hard right now to put a WC PPO in place, you not only limit your workers’ post-injury medical choices, with a little tweaking, you may also provide a much better WC medical system for your Illinois operations.

In our view, it is easy but you need to get on it right now. This bill could be signed any day and it will go into effect of its own accord if the Governor takes no action by August 1, 2011. Please note there is no way to find out when Governor Quinn will sign the new bill—he is busy with other major government issues at present.

Either way, dig in and expect that very-hittable belt-high fastball. Illinois risk managers should get on the phone to their brokers right now and let them know you need to offer all of your workers what is called a Preferred Provider Network in the new Amendments. If you don’t have a broker who understands what you are asking, have them contact us. We have been advised these programs are also called Preferred Provider Program, Preferred Provider Association and Preferred Provider Option. We are not aware of any difference regardless of the name chosen. All of them involve a ready-made system for healthcare that should be identified, explained and presented to every Illinois employee at the time of their hire.

Then, if an unfortunate event occurs and they become injured at work, you are ready. We recommend you already have your selected emergency care treatment facility identified. For non-emergent OccHealth care, have your OccHealth facility selected and ready to rock. As it is now completely legal to direct workers to such institutions to initiate early care, make the absolute most of it. This is something you need to emphasize at job orientations, at any manager’s meeting and consider putting up signs identifying these facilities as your place of choice. If you have a workers’ comp website for your workers—add the PPO to it. If you want a sample or suggested WC website for your workers and managers, send a reply.

If/when your troops go into the PPO for work-related care, you may expect solid medical care with lots of options; the PPO should work for you. Most PPO’s also provide tremendous cost-savings for employers with reimbursements lower than our newly reduced WC Medical Fee Schedule. A truly solid WC PPO should also have primary care physicians who have a focus on targeting MMI and return to work at light and full duty. There is nothing wrong with telling your OccHealth providers of your light work program and ask them to keep it on file at their facilities.

We consider this an amazing new change to our WC system and we are certain it will provide savings in both medical and indemnity reserves at every level and with all Illinois employers smart enough to move to it. Please don’t be the last one on your block to sign up—all of your competitors are going to be doing so.

We appreciate your thoughts and comments. Please do not hesitate to post them on our award-winning blog at: http://keefe-law.com/kcablog.html