11-25-13; Obamacare Causing Major Medical Confusion; WC Fall-Down Reversed Without Mention of "Traveling Employee" Rule; Jim Egan JD Analyzes Important Child Support Decision and more

Synopsis: Obamacare is Causing Major Medical Confusion—It Is Certain to Impact WC Claims.

Editor’s comment: We were mildly amazed to hear Abbott Laboratories CEO Miles White quoted last Tuesday to confirm there are "clear incentives for companies to drop their health care plans and move people onto the [federal health insurance] exchanges." Basically, what U.S. executives are starting to understand is they may cause millions of unexpecting American workers to be blindsided with the news they'll be forced into this dysfunctional government online marketplace. If and when this might happen, many U.S. workers and their families will face higher healthcare premiums or dramatically higher deductibles. All such workers will be required to share private medical and financial information on a website with a questionable security firewall, opening their personal and health information to frauds, hackers and scam artists.

Abbott Labs CEO White also confirmed his view most employees of his companies will be very unhappy to be cut adrift from corporate healthcare coverage they have enjoyed for decades to then be forced to figure out these national exchanges. When this occurs, the outcry against our current President and Democratic leaders may hit a fevered pitch. Most people employed by large companies are used to having the coverages laid out by the veteran and experienced HR managers who understand the nuances of healthcare coverage(s). If/when that ends, we are all going to have to figure out the best plan from these creaky and confusing federal healthcare exchanges with little assistance. We are confident lots of folks are going to make a mess of things and not understand what they have signed up for until they are injured or sick.

President Obama's "fix" last week would allow insurers to renew old individual healthcare policies for one year, if state insurance regulators are on board. Last Friday, Illinois insurance officials announced they would allow the temporary remedy to leave existing programs in place for the time being. Now we'll see how Illinois healthcare insurers may respond. Whatever happens, this move is merely stalling for a real answer and to quiet lots of screaming voices, for now. Many observers are confident a complete renovation of the sweeping federal law is still urgently needed.

Many observers also note workers who gain coverage through smaller employers, like law firms, TPA’s, nurse case management companies and physician’s offices are at risk of getting cancellation notices next year. Here's why--businesses with 50 employees or less buy healthcare coverage in the small-group market. These plans can temporarily keep offering coverage that doesn’t meet expensive Obamacare requirements. When that ends next year, though, many employers may cancel policies because Obamacare coverage may shockingly boost group healthcare coverage costs for employers and the opt-out penalties aren’t a sufficient disincentive.

As medical providers, hospitals and large clinics are bracing for significant financial turbulence, they note out-of-pocket deductibles for treatment, surgeries and diagnostics are dramatically rising. Workers will find themselves liable for more of their medical bills before healthcare insurance even starts coverage. In past experience, U.S. hospitals could count on healthcare insurers to pay 80-90 percent of most medical costs—the 10-20% balance would then become a reasonable cost for patients and their families. For patients who will now be dealing with high-deductible government exchange plans that may cost workers as much as $6,000 per year, the healthcare insurer's share of many medical procedures may drop as low as 60 percent on average.

Workers who have healthcare coverage through large American companies are benefiting from a one-year reprieve from the Obamacare mandate to provide coverage or pay penalties. The reprieve ends by 2015 and employers like CEO White of Abbott are already carefully calculating what to do. Some employers may cut jobs or workers' hours to avoid the requirement of offering costly insurance coverage. Other companies may dump everyone into the federal exchanges and pay penalties that are almost certain to be less than what coverage would cost.

What Does All This Mean to Workers’ Compensation?

      Always remember WC medical coverage is close to being every human’s impossible dream—injured workers want 100% on-demand coverage of unlimited medical care for work injuries and illnesses. There are no deductibles, contributions or co-pays in WC medical care. Workers who suffer injuries or illnesses on the job are also provided lots of information and choices on how to get the best possible care; you don’t have to figure it out for yourself. In major and medium WC claims, employers/insurance carriers may assign telephonic or on-site nurses to provide hard-fought expertise and assist with all aspects of medical care and bill processing.

      As a limiting factor to the basically unlimited, on-demand WC treatment model, the IL WC PPP network is a program designed to provide some cost-sharing and limitations on medical care. We have no idea what the downside to this approach might be and we feel ACA is going to put lots more pressure on WC adjusters and claims. If you have interest in joining an IL WC PPP network, please send a reply.

      We are also predicting lots of “repetitive working” claims for employers in IL and across the other states where we provide defense—Wisconsin, Michigan and Indiana. The reason we feel such claims will arise is to force employers to pay medical benefits under WC that they won’t owe under ACA. The high deductibles of the Affordable Care Act are going to push workers to try to seek the unlimited, on-demand WC coverage of questionable illnesses and injuries. If you need help defending “repetitive working” claims, send a reply.

      In further contrast, many WC observers felt there might be less utilization of workers’ compensation medical treatment because ACA requires group coverage for pre-existing conditions. However, the expansion of such coverage under ACA is clearly offset by dramatically higher deductibles that may push more pre-existing conditions back into the workers’ comp arena so workers aren’t faced with paying those initial costs. We also feel workers may choose to obtain WC medical handling of their care because it comes with a great deal more certainty in providers, coverage and cost.

      The coming changes in Medicare reimbursement levels are expected to result in cost impacts for those states that use Medicare as a basis for reimbursements in their respective state workers compensation fee schedules for medical treatment/billing. For our Illinois readers, this won’t have any direct impact on our state or its WC medical costs.

      Another result of ACA is in the Black Lung Benefit Entitlement provisions which will make it easier to file claims for and to obtain benefits; increases the benefits payable for such claims; and will increase future insurance premium costs for affected industries. As higher costs hit, premiums are certain to go up.

      Further, promotion of wellness initiatives under ACA may reduce the incidence and duration of workers’ compensation claims. We hope our IWCC and reviewing courts don’t make every bump and bruise in a wellness program work-related but we will have to wait and see what our “activist” reviewing courts may do with this concept. If you need a document confirming participation in such programs is voluntary and hopefully non-work-related consistent with Section 11 of the IL WC Act, send a reply.

      We are also sure provisions making generic drugs more available sooner in the process may result in lowered pharmaceutical expenses in workers’ compensation claims. Please note this is the area of medicine that is rising fastest in overall cost.

      We are also certain new taxes are expected to be levied on drug manufacturers, medical device manufacturers, and health insurance companies—when the new taxes land, there can be an expected trickle-down to employers and consumers.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Wow, Are We Confused—IL WC Fall-Down Reversed to Provide Benefits to Worker With NO Mention of “Traveling Employee” Concept.

Editor’s comment: In Suter v. Illinois Workers' Compensation Commission, 2013 IL App. 130049WC, issued November 14, 2013, our Appellate Court, Workers’ Compensation Division was faced with a denial on Arbitration, denial before the IWCC panel and denial at the Circuit Court level. Despite the earlier denials, the Appellate Court unanimously reversed, finding the fall-down compensable “as a matter of law.”

Claimant Suter was a staffing worker from Manpower. She was loaned to the State of IL by that temporary services company. While exiting her car to go to into her workplace, she slipped and fell on ice on a parking lot. Both the building and the parking lot were being rented by the State of Illinois but were not owned or managed by the State. There is no question the building manager provided a specific parking space for this worker at her request.

Please note assigned parking spots or even assigned parking areas aren’t a good idea, if you want to avoid IL WC coverage of parking lot fall-downs. We advise our clients not to assign spots and let folks park wherever they want, rather than face expanded coverage for fall-downs. Our advice to IL Attorney General Lisa Madigan moving forward—tell all the building managers for properties rented by State government to immediately stop assigning parking spaces and avoid this exposure. We provide parallel advice to any staffing company risk manager that reads this article—tell your accounts not to assign parking spaces on their parking lots to your staffing workers. If you let them park wherever they want, you may avoid WC liability.

In this claim, the IL WC Appellate Court ruled claimant's ability to use the parking lot was derived from her status a temporary State of IL employee. They also noted use of the parking space was customary and permitted. Accordingly, injuries caused by the fall-down arose out of claimant's employment as a matter of law.

What is mildly to wildly unusual is this is a Manpower temporary worker who clearly would not have been working on Manpower’s premises. That makes her a “traveler” in relation to her main employer. Please also note the State of IL was dismissed as a party to the appeal, as WC claims against the State cannot be appealed past the IWCC. You may also note the facts of the accidental injury in this claim closely parallel the fall-down suffered by Claimant Stanislawa Mlynarczyk in her fall-down-going-to-work-but-not-on-the-premises-of-her-employer claim that was ruled compensable in Mlynarczyk v. IWCC by the same five members of the Appellate Court panel in the unanimous ruling. Feel free to compare:

http://www.state.il.us/court/Opinions/WorkersComp/2013/3120411WC.pdf

As Claimant Suter was a “traveler” in relation to Manpower only, she would be covered without any of the arguably challenging analysis involved in this “We-are-Illinois-and-any-parking-lot-fall-down-involving-an-assigned-space-is-covered-as-a-matter-of-law” ruling. We don’t know why they wouldn’t simply deem Ms. Suter to be a “traveler” and thereby cover her under that much more sweeping concept and not worry about any issues, like “arising out of and in the course of employment.” We are also starting to become concerned the august members of this Court want to end all WC litigation with their new “matter of law” WC coverage approach to lots of formerly fact-based legal concepts.

We can only guess to think the members of this Court know what the Supreme Court may be doing with the hotly-expected ruling in Venture-Newberg-Perini Webster & Stone v. IWCC but we find it difficult to contemplate they don’t even mention their four prior “traveling employee” rulings that would apply to these facts and dramatically streamline their ruling in this case.

On a final note, please remember we are strong, strident and respectful opponents of the “traveling employee” expansion of IL WC benefits. In our view, almost all staffing workers are covered for all reasonable/foreseeable injuries and illnesses all day during travel to and from work and on all breaks because 99% of them don’t work “on the premises of their employer.” It is our strongest hope this unsustainable workers’ compensation coverage concept is abandoned by our courts or forever eliminated by our IL General Assembly. In rulings such as this where the members of what is typically our highest WC reviewing court don’t even mention this sweeping and game-changing coverage concept, it leads to confusion and chaos. We feel it becomes impossible for Arbitrators, Commissioners, lower courts, adjusters, risk managers and attorneys on both sides to accurately predict what to do in handling, trying, settling and otherwise resolving such claims.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Strict Compliance Required to Compel Child Support Withholding and Initiate the Daily $100 Penalty. Analysis by James F. Egan, J.D.

Editor’s comment: In Schultz v Performance Lighting, Inc., the Illinois Supreme Court ruled individuals seeking to compel IL employers to withhold child support under the Income Withholding for Support Act, 750 ILCS 28/35 (West 2010), must strictly comply with the notice requirements of the statute. Failure to do so could leave Plaintiff, in this case the mother, left without child support.

Under Section 35 of the IWSA, an employer who fails to withhold to meet its employee’s court-ordered child support obligations may face a $100/day penalty if the employer knowingly fails to withhold income after receiving notice under the Act. This penalty applies to payment of workers’ compensation benefits, including both TTD and settlements.

The payments must be made to the IL State Disbursement Unit if the party seeking support meets the unequivocal statutory requirements for supplying notice to an employer. While the instant matter did not involve a workers’ compensation case, at KCB&A we routinely advise our clients to act with great caution and consult our defense team when settling any GL, WC or EPLI matter with an outstanding child support lien or withholding child paying benefits from TTD payments in an ongoing matter. If you aren’t sure about whether to deduct child support in an ongoing claim, send a reply.

In Schultz, the wife alleged her ex-husband’s employer knowingly failed to make child support payments to the State Disbursement Unit, so Plaintiff filed a lawsuit under the Act. She contended Defendant’s breach triggered the daily penalty. Unfortunately Plaintiff had failed to supply the social security number of her ex-husband and other pertinent information in court documents served on the employer.

The IL Supreme Court determined the notice provision was invalid based on the omission of the required social security number from the notice and rejected Plaintiff’s position she had substantially complied with the notice provisions. Emphasizing the rules of construction, the court held, by singling out the lack of a signature as an omission that would not affect the validity of notice, the General Assembly had expressed its intent that the other 11 requirements of the statute absolutely were required. The Supreme Court also observed the statute provides a safe harbor for an employer complying with the withholding obligation only to the extent the notice contains the statutorily required information. The employer could face a Catch-22 if the statute were interpreted as Plaintiff urged; an employer faces civil liability for withholding wages unless the request to do so meets the statutory requirements.

The IL Supreme Court did note a troubling lack of communication between the party who sought but, for two years, did not receive payment, and the employer who had notice, albeit defective notice. Recent amendments to the statute requiring follow-up notice and response address this concern to some extent, requiring the recipient of support to timely contact the employer as to why support is not being withheld. This then triggers a required response from the payor to notify the obligee.

This article was researched and written by James F. Egan, J.D. Please feel free to contact Jim about it at jegan@keefe-law.com.

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Coming events from KCB&A

Happy Thanksgiving to All Our Readers and Clients! Be Careful Out There!!

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Synopsis: The KCB&A Monday law updates are archived on the KC&A blog!

Editor’s comment: If you are looking for any article previously written in this update, or just want to browse through a host of insightful articles dealing with our Illinois Comp system, stop on over to http://keefe-law.com/kcablog.html and take a look. The blog currently includes archived articles dating back to August 2008.

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Synopsis: Top Twelve Free (or almost free) and Truly Handy Claims/Risk Management Stuff from Keefe, Campbell, Biery & Associates to our readers.

Editor’s comment: We do lots of things for this industry that you may not know about. Let us know if you have interest in any of these services.

1. First and most important, send your claims inquiries and toughest questions to ekeefe@keefe-law.com for 24/7/365 answers to your toughest Illinois claims questions. Give us 24 hours and we will get back to you with reasoned thoughts and suggestions, recommendations on pro se settlements and best practices in handling difficult and complex claims concerns.
2. Next, take a look at actual winning results from the top defense firm in Illinois, Wisconsin, Michigan or Indiana by going to this link:

http://www.keefe-law.com/Successful_Decisions_Document.pdf

1. Shawn R. Biery does a continuously updated and very handy Illinois Workers’ Compensation Rate Sheet. It is available to anyone upon request. If you want it, send a reply or email Shawn directly at sbiery@keefe-law.com.
2. We have a one-page document free to the industry called Keefe, Campbell, Biery & Associates Rules of Thumb that provides a quick reference for adjusters and risk managers with Illinois claims. Again, if you have interest, send a reply.
3. We have a free book on the 2005 Amendments to the Illinois Workers’ Compensation Act. It is also available in a condensed form. If you would like a copy, send a reply.
4. We also have a free book on all aspects of Illinois Workers’ Compensation Law and Practice. If you are unfamiliar with the Act and Rules and want a resource book, please send a reply.
5. We provide answers to questions adjusters have about appropriate reserves on your claims, usually within 24 hours. We employ WestLaw© research in rendering our evaluation for your complete file. If you have interest in a legal opinion to support your reserve calculations, email ekeefe@keefe-law.com.
6. We obtain rapid approval of pro se settlements in Chicago for the low price of $250.00 and outside the Chicagoland area at $350.00. If you have interest in such services, again, email ekeefe@keefe-law.com. We can turn such approvals around in days with cooperation from claimant.
7. We are happy to provide a free legal audit of up to ten of your worst litigated claims. Our goal is to advise how to best bring such claims to rapid closure within authority. We have had solid outcomes from such reviews. All of our handling is attorney-client privileged. If you have interest in a legal audit, send a reply to ekeefe@keefe-law.com.
8. We have a strong list of medical, diagnostic, pharmacological, vocational, utilization review, nurse case managers, surveillance, accident reconstruction, ergonomics, safety and other top-notch experts for your consideration to use in Illinois workers’ compensation, general liability and employment law defense litigation. Such recommendations are free. We update such lists continuously. We can also provide research backing up the credentials of such experts. If you have a need for an expert, send a reply.
9. We are the only defense firm that has several workers’ compensation law professors on staff—we have read and analyzed every single IL WC appellate ruling for over three decades. For any of our readers, if you have a complex (or even a simple) question about any aspect of Illinois workers’ compensation law and practice, please send a reply and we will advise within 24 hours. If you have interest in attending or auditing the best workers’ compensation course in Illinois at one of our top law schools, let us know and we will provide details.
10. Need a calculator for your desk? Send a reply and we are happy to send a free one that works!

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Trivia corner

Last week’s questions with answers in red:

John Fitzgerald Kennedy passed away on November 22, 1963, fifty years ago this week. Here is some JFK trivia.

v  How many significant similarities are there between the passing of JFK and Abraham Lincoln? At least 16, many of them mildly eerie.

v  While John Kennedy was considered a very popular President, what IL politician was instrumental in helping him to win or what some observers felt was “steal” the 1960 Presidential election? Chicago Mayor Richard J. Daley who held the ballots until some veterans felt the ballot boxes were properly “stuffed.”

v  As our country seemingly refused to believe one misguided gunman could shoot our President in the fashion that it occurred, is there any compelling evidence to the contrary? Not that we ever heard—it is sort of like not believing the U.S. had a man on the moon; if you don’t believe it, that doesn’t mean it didn’t happen.

v  What building in Chicago helped make the Kennedy family zillions and helped to elevate several of them, including JFK to high political office? The Merchandise Mart that was developed by his father.

v  What was the 120-year curse for U.S. Presidents that ended with the passing of John Kennedy and was broken by Ronald Reagan?? Six Presidents, elected every 20 years, died in office. Ronald Reagan was shot but survived to break the weird curse.

This Week’s KCB&A Trivia questions. The first one to get them right, gets a $25 Starbucks Gift Certif:

Ø  What are we giving thanks for on “Thanksgiving?”

Ø  Is there actually a rock named Plymouth Rock and why do we still remember that place?

Ø  Why were the folks who landed in the U.S. in 1620 called “Pilgrims?”

Ø  What were the settlers of 1620 initially called?

Ø  What part of the Thanksgiving turkey is saved and snapped as a superstitious good luck custom?

11-11-13; Gay-Lesbian Marriage Soon To Be IL Law-Can We Revisit Death Benefits?; Handling IL WC Hearing Loss Claims; Understanding Psych and much more

Synopsis: Now that Gay Marriage/Divorce Has Landed and is Off the Political Table, Should We Reconsider How IL WC Death Benefits are Awarded?

Editor’s comment: Not sure if you like or dislike gay marriage and divorce but we are certain one’s personal feelings have nothing to do with it any more—it is soon to be the law in our state, our elected leaders have spoken and we are all going to have to adjust. On some levels, we are thrilled to see this relatively minor issue taken off the political landscape so our Governor, General Assembly and other local leaders can move forward to manage and hopefully improve the numerous financial issues that are plaguing all citizens of this troubled state.

From the IL workers’ compensation perspective, there is no question in our mind all benefits previously accorded to widows and widowers will now be expanded to cover legally married gays and lesbians. This is certain to increase the number and premium cost of covered WC death claims in our state. What is ironic is one reason IL WC death benefits most recently increased is, about a decade ago, our former-Governor-Behind-Bars made a political deal to give away control of the IWCC to beat Paul Vallas in a primary—Paul Vallas was just tapped to be Governor Quinn’s running mate. The giant increase in IL WC death claims in 2005 was directly related to that 2002 political agreement which kept Mr. Vallas out of political office years ago. If you aren’t aware, Illinois workers’ compensation death benefits are among the top three WC death awards in the entire country. The minimum a widow or widower may receive is well over $600,000 and the maximum is over $1.7M.

In our view, the death benefit concept was created in 1909 when the first IL WC Act was formed basically as a life insurance policy that is owed regardless of levels of widow/widower dependency. By that we mean, if you are married and your spouse passes, you get a lot of money, whether you need it or not. We think the IL WC Act should be changed so all married couples should have to retain counsel and demonstrate to the Arbitrator assigned some minimal level of dependency before their employers are required to fill in the financial gap caused by the passing of a loved one.

If you stroll down memory lane, you might note the IL WC Act was created as the result of 259 men and boys being killed in the Cherry, IL mine disaster and leaving hundreds of widows and children without any means to pay for their homes, food and educations. Shortly thereafter, the IL General Assembly enacted WC death benefit coverage. As this all predated “Rosie the Riveter” and the movement of U.S. women from being homemakers only to currently being a strong, robust and vibrant part of the U.S. workforce, the life insurance model underpinning WC death benefits may have changed, as marriage has changed.

In our view, the legislative and administrator scheme might improve if we update it also. We feel it would be a solid idea to consider having all widows or widowers obtain legal counsel and then come to the Commission. A hearing could be conducted to demonstrate a need for all or an appropriate part of the death benefit by showing dependency on the spouse who recently passed at work. For one example, please assume we are considering a couple where a wife is very successful—she is a sportscaster and makes $500,000 a year. Her spouse takes care of the home and basically manages the couple’s affairs but only makes $25,000 a year in a part-time job. If the at-home spouse passes due to a work injury or illness, as IL WC law outlines today, the death benefit remains $600K+. We feel the employer should be able to respectfully challenge that high value where dependency is very low or non-existent.

The other WC anomaly is the abandoned marriage—a marriage in which a couple has moved apart from each other and stayed apart in separate homes for years and years. When one or the other spouse in an abandoned marriage has passed, dependency is non-existent. In such a setting, we consider it egregious for an employer to have to pay our generous IL WC death benefit basically as a gift to the survivor who had no recent contact with their former partner. We feel an employer should be able to retain counsel and appropriately challenge all or part of such a claim before the Arbitrator assigned.

Please note we don’t feel this would apply as smoothly to minors who remain legal charges of their parents. But again, we feel our Arbitrators could listen to the facts and insure the protection of the young and innocent offspring of a decedent. One of the most interesting and touching WC death claims we have ever handled was a claim by a widow who had three young girls and an elusive spouse with lots of personal issues who took off on her, never to return. Several years later, she was valiantly raising her girls as a single mom when their absent father was murdered in a robbery where he was working at a convenience store.

As part of handling of the WC death claim, we were asked to do a search for the spouse and dependent children and one of our crack surveillance operatives located the widow. By this time, the girls were ending high school and about to enter college; the mother was despondent about how to afford higher education for her beautiful children. When we called to advise that her troubled husband had passed, she cried for some time. When we advised her of the amount and value of the death benefit, she indicated she didn’t want a penny of it but wanted all of the money to be paid into three trust funds for the girls’ educations. With the approval of the Arbitrator assigned, we were able to put that request into place. To our understanding, several years later, all three of the young women wisely used the money to get their college degrees and move into great jobs. The mother told us the only thing her husband did for her in life was to give her the blessing of the three girls and the only thing he did for her in death was to finally provide for their schooling through our workers’ comp system.

In summary, we feel dependency and an appropriate level of a death benefit for any widow or widower should be an issue fairly litigated in the right IL WC death claim. Such litigation would insure the property parties are receiving fair and reasonable benefits and the cost to IL employers is similarly appropriate. We appreciate your thoughts and comments.

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Synopsis: Handling IL WC Hearing Loss Claims for Either Side of the WC System.

Editor’s comment: We are asked all the time about hearing loss claims and wanted to provide our expert thoughts. In our view, there are two kinds of IL WC hearing loss claims. Actually, two and one-half, if you include IL firefighters with 5+ years of service.

BOOM as a Hearing Loss Claim

The first type of hearing loss claim we call "BOOM" where there is a loud noise or explosion in the workplace that causes a hearing problem. We assume that concept is fairly simple for newbie lawyers and other student. Defending/presenting "BOOM" hearing loss claims are akin to defending any WC accident--did it happen, how bad was it, how bad were the results/effect on the hearing.

Hearing Loss as Occupational Exposure

Two, or the second type of IL WC hearing loss claim is statutory. You don't get hearing loss benefits if you aren't exposed to levels higher than provided in the IL WC Act—the exposure levels are below. If someone is exposed to decibel levels of a certain amplitude and loses some or all of their hearing, they get money. IL Employers have to insure their workers aren't so exposed—seems pretty simple, right?

Other than for 5+ year firefighters, there is no IL WC provision for hearing loss benefits for simply losing your hearing. What? Say that again? You don't get benefits if you simply start to lose your hearing. We all start to lose our hearing as we age. Hearing loss in 5+ year firefighters is presumed to be related to work, like lots of other conditions.

Finding Your Firefighters Something to Do All Day as Public Safety Officers

Our vote on saving money for those expensive and typically idle firefighters is to move to “public safety” officers. There are way less house fires than when our grandparents were young; we don’t actually remember seeing the remains of a house fire in the last ten years. Building codes and approved fire safety protocols have effectively eliminated fire risk but lots of municipalities and governments haven’t realized you don’t need to spend millions and millions on idle, unused and very expensive, round-the-clock firefighters. The National Fire Protection Association indicates over the past 35 years, the number of fires in the United States has fallen by more than 40% while the number of career firefighters has increased by more than 40%.

Some communities now have public safety officers that are police officers who fight the occasional kitchen fire and/or firefighters that are kept busy as police officers. The Village of Glencoe, IL is a model for this much more efficient path for all U.S. taxpayers to consider. The Glencoe Department of Public Safety is a combined public safety agency where officers receive combined training as police officers, firefighters, and paramedics. Glencoe has operated a combined Public Safety Department since 1956. The only conceivable reason not to move to this concept is your local fire union officials are certain to fight it.

5+ Year Firefighters Get Special WC Coverage

In the workers’ comp arena in Illinois and about forty states, firefighters with seniority are presumed to be globally covered for almost any on or off-work malady that befalls them—this causes a giant spike on WC costs for firefighters. In our view, the only reason for this heightened statutory coverage for firefighters is their union got the increased coverage they wanted for their members from our General Assembly. In this state, where the choice is extraordinary benefits for government workers at the sole cost of Illinois taxpayers, taxpayers always lose.

What the IL WC Act Provides for Hearing Loss

So other than for 5+ year firefighters, here is the language from the IL WC Act. You will note “BOOM” is covered at the bottom.

16. For the permanent partial loss of use of a member or sight of an eye, or hearing of an ear, compensation during that proportion of the number of weeks in the foregoing schedule provided for the loss of such member or sight of an eye, or hearing of an ear, which the partial loss of use thereof bears to the total loss of use of such member, or sight of eye, or hearing of an ear.

(a) Loss of hearing for compensation purposes shall be confined to the frequencies of 1,000, 2,000 and 3,000 cycles per second. Loss of hearing ability for frequency tones above 3,000 cycles per second are not to be considered as constituting disability for hearing.

(b) The percent of hearing loss, for purposes of the determination of compensation claims for occupational deafness, shall be calculated as the average in decibels for the thresholds of hearing for the frequencies of 1,000, 2,000 and 3,000 cycles per second. Pure tone air conduction audiometric instruments, approved by nationally recognized authorities in this field, shall be used for measuring hearing loss. If the losses of hearing average 30 decibels or less in the 3 frequencies, such losses of hearing shall not then constitute any compensable hearing disability. If the losses of hearing average 85 decibels or more in the 3 frequencies, then the same shall constitute and be total or 100% compensable hearing loss.

(c) In measuring hearing impairment, the lowest measured losses in each of the 3 frequencies shall be added together and divided by 3 to determine the average decibel loss. For every decibel of loss exceeding 30 decibels an allowance of 1.82% shall be made up to the maximum of 100% which is reached at 85 decibels.

(d) If a hearing loss is established to have existed on July 1, 1975 by audiometric testing the employer shall not be liable for the previous loss so established nor shall he be liable for any loss for which compensation has been paid or awarded.

(e) No consideration shall be given to the question of whether or not the ability of an employee to understand speech is improved by the use of a hearing aid.

(f) No claim for loss of hearing due to industrial noise shall be brought against an employer or allowed unless the employee has been exposed for a period of time sufficient to cause permanent impairment to noise levels in excess of the following:

Sound Level DBA  Slow Response Hours Per Day

90                                8

92                                6

95                                4

97                                3

100                             2

102                             1-1/2

105                             1

110                             1/2

115                             1/4

This subparagraph (f) shall not be applied in cases of hearing loss resulting from trauma or explosion.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Handling Psych Claims in Workers’ Compensation.

Editor’s comment: As liberal/radical as our IL WC system can be, Illinois actually remains somewhat “conservative” about psych events/injuries. The IL WC system still hasn’t moved to what we call “California Stress” psych claims. By that we mean if your boss is mean to you or your customers are challenging, you still can’t get WC benefits for the discomfiture normally associated with regular or demanding work. The main reason we feel this focus continues is the reluctance of Plaintiff/Petitioner attorneys and most Arbitrators have about dealing with psych-challenged folks—in our view, Arbitrators listen to enough whining when real injuries are present; they don’t get paid enough money to listen to weeping, wailing and gnashing of teeth over normal or even extraordinary work stress.

In contrast to “job stress” claims, there is the sudden and unexpected shock that may occur when someone, other than claimant, is seriously injured or dies in the workplace. These cases fall under the parameters of an older ruling from our IL Supreme Court namedPathfinder. In the Pathfinder ruling, the worker making the claim was working next to a subordinate who had both hands traumatically amputated by a machine. The worker had to retrieve the severed hands from the machine. For reasons we will never understand, a defense lawyer took that case all the way to our Supreme Court to make law that was, in our view, bad for the defense industry—they would have been much better off paying for appropriate psych care and trying to amicably and quietly work something sensible out with the traumatized worker and their attorney.

Please note in any accepted or disputed psychiatric claim there are often no objective physical findings that can be measured.  With subjective mental symptoms, the question of their validity may be influenced by the opinion the employer had of the employee prior to the claim.  If the employee was known to be indolent or lazy prior to the WC psychiatric claim, supervisors are less likely to accept the claim of a mental injury. In contrast, a hardworking and effective employee may be given every benefit of the doubt when their psyche becomes an issue in a post-accident setting. Either way, a detailed investigation into the medical/psychiatric documentation and the other non-work related factors that could affect the employee’s mental state may be necessary.

The investigation into a psychiatric claim is unquestionably complicated by the inability to easily obtain psychological and psychiatric records—you can’t simply send a subpoena. The Illinois Mental Health Confidentiality Act renders traditional subpoenas worthless and an adjuster or attorney has to closely adhere to the Act to get such records. You are much better off to advise the worker or their attorney you need records to support any claim for compensation and without certified records, you are unable to consider any payment.

There are two types of mental injury claims, physical-mental and mental-mental.  In a physical-mental psychiatric claim, the employee had incurred a physical injury at work, and as a result of the acute or traumatic physical injury, has developed a related mental injury.  A common example is the employee who injured their back, and from worries about how they will support their family on reduced income or TTD, develops depression and melancholy. Please also remember employees with work injuries may be coached by a Plaintiff/Petitioner’s attorney to magically suffer post-traumatic stress disorder after their injury—the best way to defend such claims is to focus on the DSM-V or the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition, which is the 2013 update to the American Psychiatric Association's classification and diagnostic tool.

Mental-mental claims are the “California stress” claims we mention above where your boss is mean or your customers are demanding and the worker becomes imbalanced. To date, we do not see such claims gaining traction in our state.

If you need legal assistance in dealing with the intricate nature of psych claims, please send a reply any time. We can recommend a number of solid psych experts for the psychiatric-legal opinions. We appreciate your thoughts and commen

11-4-13; Is the IL State Chamber Judicial Activism Report "Unfair"??; Bad Personal Habits are Clearly Compensable for "Travelers"; Matt Ignoffo Reviews Important Contribution Ruling and much more

Synopsis: Is the IL State Chamber Judicial Activism/Legislative “Inactivism” Report Fair or Unfair?

Editor’s Comment: We obtained and carefully read the seminal treatise from the IL State Chamber titled The Impact of Judicial Activism in Illinois—Workers’ Compensation Rulings from the Employer’s Perspective. We salute IL Chamber President Doug Whitley and Kathleen Bruns for drafting it. As we advised our readers last week, it is a “must-read” for all Illinois risk managers/claims handlers if you want to understand why our WC system is so challenging. If you want a copy of the report, surf to www.ilchamber.org; for clients of our firm, send a reply and we will get you a copy.

Our favorite passage is:

In conclusion, the essence of Illinois’ troubled workers’ compensation system is two-pronged (1) unfettered judicial discretion in interpreting the workers’ compensation law with the clear objective of expanding compensability of workers’ compensation claims; and (2) the failure of the Illinois General Assembly to pass legislation clearly expressing legislative intent and parameters of effectuation the provisions of the Act with the objective of ensuring the workers’ compensation system in Illinois is fair, predictable and benefits employers as well as injured workers.

We also read a quote from outgoing Illinois Workers’ Compensation Lawyers Association President Frank Sommario in www.workcompcentral.com where he says:

Whether WCLA members agree or disagree with a particular decision, we all agree that the Justices of the Appellate and Supreme Courts are diligent and hard-working judges, who apply the law impartially to the facts presented to them and who handle these extra workers’ compensation duties voluntarily in addition to their regular caseload.” Sommario said, “in our view, it is extremely unfair for the Chamber to draw such broad negative conclusions based on 17 cases out of the over 1,000 workers’ compensation cases that were decided by the Appellate and Supreme Courts during the period covered by the Chamber report.

We want to reply to highly respected WCLA President Sommario with our three different concerns/objections. First, IL Supreme and Appellate Court justices are among the best paid in the United States with guaranteed annual pay raises and generous pensions that also go up every year. We are certain they are diligent and hard-working and thank them for their intelligence, dedication and service.

As to the 17 cases out of a thousand being analyzed by the State Chamber report, we point out the IL State Chamber review analyzed the biggest cases—they looked at the rulings that formed the other 983 cases considered during the period of their analysis. By that we mean, prior to the E.R. Moore v. Industrial Commission ruling, IL WC didn’t have “odd lot” total and permanent disability claims. The IL WC Act doesn’t have an definition for the words “odd lot.” Due to the lack of a definition or any mention of the term, one could infer our legislature didn’t intend to provide the rights or responsibilities that come with this very, very expensive lifetime, tax-free benefit. The IL Supreme Court and Appellate Court rulings that create new laws like this foster ambiguity that generates more and not less certainty in what is supposed to be a simple and easy-to-understand area of benefits.

For an even better example, in the words of the IL State Chamber report, when our “unfettered” reviewing courts judicially “create” a legal concept, we are all left to guess what they mean by it. That generates lots more litigation to delve into the boundaries of the new hypothesis. For one simple example, the 1990 Edward Hines Lumber ruling judicially added overtime to the IL average weekly wage in contradiction to what we feel is the simple language in Section 10 of the Act. That ruling led to a 1996 decision named Ogle v. IIC which led to the Edward Donruling in 2003 which led to Freesen, Inc. v. IIC in 2004 with the most current statement in this line of overtime rulings being the 2007 decision in Airborne Express v. IWCC. At present, IL workers are required to demonstrate overtime has to somehow be “mandatory” which is another term not defined in Section 10 of the Act.

Regardless of your feelings about this plethora of rulings, our point is judicial activism creates more judicial involvement. As the IL State Chamber report accurately notes the IL General Assembly then effectively sits on their hands and does nothing to provide any guidance as to what to do about the new judicial models.

Aside from the new and unprecedented “traveling employee” concept, perhaps the simplest and most controversial legal ruling from an reviewing court your editor has ever read is Durand v. IWCC. In Durand, the worker admitted she suffered from carpal tunnel for four years and the IL WC Act required her to file the Application within three years—she admitted she didn’t do so. If you teach any schoolchild the law, it is our view such a claim should be denied 100 out of 100 times. We simply don’t see any “wiggle-room” or a path around the clear statutory language. In considering the facts of the claim, our highest court wrote they weren’t going to “punish” her for supposedly working with pain until the statute of limitations ran. What worker couldn’t make the claim they “worked with pain?” If you aren’t certain, such a ruling eviscerates the plain language in Section 6 of the IL WC Act. As court-watchers, we now have literally no idea when and how the statute of limitations might apply moving forward but we can be certain there may be lots more litigation over this previously simple and straightforward provision of the Act.

Our problem with that ruling and the 16 other such rulings outlined in the IL Chamber Report is they distill the frustration of all Illinois businesses in dealing with the ostensibly simple system of workers compensation benefits—the law is the law; if you follow the simple rules, you get what the law provides.

Please also remember the new Chief Justice of the IL Supreme Court is the revered Rita Garman who is a Republican. To the extent the Court she now leads picks the five-member Appellate Court, Workers’ Compensation Division, as a voice for Illinois business, we would love to see some new blood on this five-member panel with at least one or two members who have a strong pro-business focus. It is our opinion all five members of the current panel are excellent and knowledgeable jurists but not one of them strictly construes the IL WC Act or has a strong business focus. It is our reasoned opinion they all speak with a single voice of judicial activism in the interests of Illinois labor. It has been literally decades since there was a member of this panel that wrote a strong dissent.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Yes, Folks, Lung Cancer, Cigarette Smoking and Lots of Personal Conditions and Bad Habits are Now Work-Related But Only For “Travelers.”

Editor’s comment: We had many long-time readers object to our conclusion in last week’s lead article. They assert the personal and bad habit of cigarette smoking cannot possibly be work-related for the millions of workers who now fit the wildly expanded definition of “traveling employees.” The main objection from our readers was the deleterious condition has to be “causally connected” in a fashion our courts aren’t requiring.

Four Appellate Court, Workers’ Compensation Division rulings, several of them now final, find IL employers now owe for all “reasonable and foreseeable” activities of “travelers.” We note the first case remains pending before the IL Supreme Court and was orally argued more than six weeks ago. We hope for a ruling from the Court by the end of this year.

In Admiral Mechanical v. IWCC, the Appellate Court ruling says:

The traveling employee retains the burden of proof regarding causation. Hoffman v. Industrial Comm’n, 109 Ill. 2d 194, 199 (1984). That burden is met where the employee shows his or her conduct was reasonable and foreseeable. Cox, 406 Ill. App. 3d at 545-46.

In Venture-Newberg-Perini Webster & Stone v. IWCC, Claimant Ron Daugherty’s actions leading to injury were sitting in a car seat while his buddy was driving. Now his employer is on the hook for all his personal and non-work-related medical issues effectively for life. By the time of the hearing, he had over $1M in medical bills. If/when he passes, it will almost certainly be due to related problems and multi-million-dollar death benefits will be due.

·         Let’s assume Ron Daugherty was not in a car but riding as a passenger on a motorcycle. Riding on a motorcycle is “reasonable and foreseeable.” The same accident would clearly be compensable under the same theories.

·         Let’s assume the same motorcycle didn’t crash but went over a lot of hard bumps and he developed intractable low back pain. Despite the absence of a “work-related accident,” the court’s new rulings make such “repetitive-trauma” back pain with medical care and lost time and permanency the responsibility of the employer, even though the true cause has literally nothing to do with work.

·         Let’s assume he was riding on a motorcycle and got bit by a West Nile mosquito which is a risk common to everyone. If all he has to do is prove his actions in riding the bike are “reasonable and foreseeable” he is entitled to full WC benefits.

·         Let’s further assume he was riding as a passenger on a motorcycle and didn’t dress properly for a cold November day. He develops pneumonia from riding on the motorcycle and his doctor said the lack of proper clothing caused the pneumonia. The new rulings make that illness and its sequalae the responsibility of the employer. Medical care, lost time and permanency would be due. If he were to pass from that now-compensable medical condition, it would clearly be a death claim.

Under the same reasoning, bad personal habits like smoking cigarettes, texting while driving, not dressing properly to account for cold or rainy weather, wearing six-inch high heels or other unsafe personal footwear, smoking in bed and lots of other unsavory or questionable personal activities are “reasonable and foreseeable,” causally connected to work and compensable. All such activities are now compensable for “travelers”—at the same time, there is no such coverage for “non-travelers.”

As a challenge to our readers, if you feel the IL employer is not responsible for everything a “traveler” does from when they leave their house until they return including bad/dangerous personal habits and bad clothing, you tell us what is and isn’t “causally connected.”

Please note all prior legal definitions of “traveling employees” are about business people on business trips where the employer is paying them for foreign travel and reimbursing expenses. Ron Daugherty, Stanislawa Mlynarczyk and the other folks recently found to be “travelers” were injured off the clock and miles from their jobs. They weren’t being paid expenses or compensated during travel.

In our view, this state can’t possibly make employers responsible for injuries, illnesses and deaths for personal risks and bad habits. It doesn’t make sense and can’t be made to make sense. If you want to be mad at us for talking about it, go ahead but we aren’t causing this impossible-to-sustain concept.

We appreciate your thoughts and comments.

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Synopsis: The Illinois Appellate Court Bars Defendant from Contribution/Indemnification claims in a later suit when such claims should have been alleged in the initial lawsuit filed by an injured worker. Analysis by Matt Ignoffo, J.D., MSCC.

Editor’s Comment: The underlying facts in Camper v. Burnside Construction involve Michael Camper, an employee of Neptune Construction, who fell and sustained injuries while working in a sanitary manhole on a construction site in Elgin, Illinois during January 2006. (No. 1-12-1589, October 28, 2013). Camper filed a four-count complaint against general contractors Burnside and Welch (Camper I). In Camper I, Camper alleged causes of action for construction negligence (count I) and premises liability (count II) against Burnside, and alleged two counts of product liability against Welch, as manufacturer of the manhole, under the theories of strict liability (count III) and negligence (count IV). Welch filed a third-party action for contribution against Neptune under the Joint Tortfeasor Contribution Act.

Camper settled his claims against Burnside and Neptune. The settlement agreement stated that Neptune agreed to waive its claim for reimbursement under the Workers' Compensation Act (the WC lien). The court's February 13, 2009 order expressly stated the settlement between Camper, Burnside, and Neptune was made in good faith pursuant to the Joint Tortfeasor Contribution Act; that Camper's action against Burnside, and Welch's third-party action against Neptune, were dismissed with prejudice; and that the court "bars any actions for contribution by any other defendants or tortfeasors against Burnside or Neptune." Camper's cause of action against Welch was to continue on as Welch was the sole non-settling defendant in Camper I.

On April 22, 2009, Camper voluntarily dismissed his complaint against Welch without prejudice. On February 5, 2010, Camper refiled his cause of action against Welch only, by alleging the same two counts of product liability based on strict liability (count I) and negligence (count II) (Camper II). On May 19, 2010, Welch filed a two-count third-party action, seeking contribution (count I) and "indemnification/breach of contract" (indemnification claim) (count II) against Neptune. Neptune filed a section 2-619 motion to dismiss Welch's third-party complaint for contribution and indemnification on the basis that the claims were barred by res judicata.

In separate orders the Circuit Court dismissed Welch’s contribution (count I) and indemnification (count II) claims against Neptune and Welch appealed.

Under section 2-619 of the Illinois Code of Civil Procedure, an action may be involuntarily dismissed on the bases that "the cause of action is barred by a prior judgment" under a theory of res judicata, or that "the claim asserted against the defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim." The doctrine of res judicata provides that a final judgment on the merits rendered by a court of competent jurisdiction bars any subsequent actions between the same parties or their privies on the same cause of action. Three requirements must be satisfied in order for res judicata to apply:

1.         a final judgment on the merits has been reached by a court of competent jurisdiction;

2.         an identity of cause of action exists; and

3.         the parties or their privies are identical in both actions.

Res judicata bars not only what was actually decided in the first action, but also those matters that could have been decided in that lawsuit.

With regard to Welch’s contribution claim (count I) against Neptune the Court only needed to decide the “on the merits” requirement as the second and third requirements were satisfied here. It noted, generally orders dismissing an action with prejudice constitutes a final judgment on the merits for the purposes of res judicata.

Welch's original third-party contribution claim in Camper I was dismissed for a reason other than for lack of jurisdiction, improper venue, or failure to join an indispensable party. The Court found the February 13, 2009 dismissal with prejudice of Welch's Camper I third-party contribution action against Neptune was an "involuntary" dismissal and, thus, operated as an adjudication upon the merits. Camper's settlement with Burnside and Neptune in Camper I was a final judgment on the merits for the purposes of res judicata, where the parties agreed to a resolution and the Circuit Court dismissed with prejudice Camper's action against Burnside and Welch's original contribution claim against Neptune.

With regard to Welch’s indemnification claim (count II) against Neptune, as the “on the merits” requirement was now met and the identical parties requirement was met the Court only needed to determine whether the indemnification claim (count II) sought by Welch in Camper II has an "identity of cause of action" with the contribution claim sought by Welch in Camper I.

Illinois applies the more liberal "transactional test" in determining whether identity of cause of action exists for the purposes of res judicata. Under the transactional test, separate claims will be considered the same cause of action for purposes of res judicata if they arise from a single group of operative facts, regardless of whether they assert different theories of relief. To determine whether there is an identity of cause of action between the first and second lawsuits, a court must look to the facts that give rise to plaintiff’s right to relief, not simply to the facts which support the judgment. An identity of cause of action is established if two claims are based on the same, or nearly the same, factual allegations.

Welch argued the Camper I contribution action was a cause of action arising out of potential tort liability, while the Camper II indemnification claim was based upon contract liability. Welch further asserted the contribution claim and the indemnification claim relied upon two different sets of factual allegations for support.

The Court held regardless of the fact Welch's contribution claim in Camper I and the indemnification claim in Camper II assert different theories of relief against Neptune, both actions relied upon the circumstances surrounding Camper's accident. Welch's Camper II indemnification claim against Neptune arose from the same group of operative facts as its Camper I contribution action against Neptune. Both actions arose out of the injuries suffered by Camper when he allegedly fell while working. As all three elements of res judicata were satisfied the Court held the indemnification claim (count II) was barred. The Circuit Court judgment was affirmed.

We can learn from this holding that any and all claims need to be addressed prior to settlement agreements and orders being entered. Claims should be alleged as early as possible or they may be barred. Extensive litigation was pursued in this matter in an attempt to bring claims which likely had value, but procedural issues precluded them from being heard by a trier of fact.

This article was researched and written by Matthew Ignoffo, J.D., M.S.C.C.  Please feel free to contact Matt at mignoffo@keefe-law.com.