3-31-14; Will Northwestern Football Forever Change College Sports/Scholarships to Get WC Benefits?; Important IL WC Death Claim Ruling; Mike Shanahan, JD reports on WCLA CLE Presentation and more

Synopsis: Will Northwestern Football Players Forever Change College Sports and Possibly All Scholarships to Get WC Benefits?

Editor’s comment: This past week, the world of college sports was tossed on its ear with a ruling from the Chicago District of the National Labor Relations Board. The Board ruled last Wednesday that Northwestern football players are now employees of the university and can unionize. NLRB regional director Peter Ohr cited the players' time commitment to the sport and the fact  their scholarships were tied directly to their performance on the field as reasons for granting them union rights. Ohr wrote in his ruling the players "fall squarely within the [National Labor Relations] Act's broad definition of 'employee' when one considers the common law definition of 'employee.'" Ohr ruled players can hold a vote on whether they want to be represented by the College Athletes Players Association, which brought the case to the NLRB along with former Wildcats quarterback Kain Colter and the United Steelworkers union.

Northwestern issued a statement shortly after the ruling saying it would appeal to the full NLRB in Washington, D.C.:

While we respect the NLRB process and the regional director's opinion, we disagree with it," the statement read. Northwestern believes strongly that our student-athletes are not employees, but students. Unionization and collective bargaining are not the appropriate methods to address the concerns raised by student-athletes.

In a statement, NCAA chief legal officer Donald Remy said: "While not a party to the proceeding, the NCAA is disappointed that the NLRB Region 13 determined the Northwestern football team may vote to be considered university employees. We strongly disagree with the notion that student-athletes are employees." Remy added: "Over the last three years, our member colleges and universities have worked to re-evaluate the current rules. While improvements need to be made, we do not need to completely throw away a system that has helped literally millions of students over the past decade alone attend college. We want student athletes -- 99 percent of whom will never make it to the professional leagues -- focused on what matters most -- finding success in the classroom, on the field and in life."

The Big Ten also disagreed with the ruling and released a statement that read: "While we respect the process followed by the National Labor Relations Board, we disagree with the ruling. We don't believe that student-athletes are university employees. The issues raised during the hearings are already being discussed at the national level, and we believe that students should be a part of the conversation."

Colter, whose playing eligibility has been exhausted, said nearly all of the 85 scholarship players on the Wildcats' roster backed the union bid, though only he expressed his support publicly. The United Steelworkers union has been footing the legal bills. CAPA attorneys argued college football is, for all practical purposes, a commercial enterprise that relies on players' labor to generate billions of dollars in revenues. They contend the commercial enterprise makes the relationship of schools to players one of employers to employees.

Should Northwestern Football Players Get IL WC Benefits?

One of the benefits the football player/students are seeking is workers’ compensation coverage for all injuries they suffer. This benefit might provide them full medical coverage for football-related injuries, “lost time” and permanency. Please note one of the fundamentals of workers’ comp benefits other than medical benefits is having a salary or wages from which to compute the Average Weekly Wage, TTD and PPD. The only current salary the players have is the compensation they receive for tuition, room and board. All reports indicate the value to the players for an annual scholarship is $76,000 a year which would render an AWW of about $1,461.54 each week. Their  TTD rate would be $974.36 and PPD would be the current maximum IL WC PPD rate of $721.66.

The problem the football players have is they remain on scholarship on a year-to-year basis so they wouldn’t need TTD until their scholarships ran out. While serious and moderate football injuries do happen, most of the players are young, strong and recover for the most part. We don’t see significant PPD awards other than for the most serious injuries. However the risk and cost of WC insurance for such players would be significant. The whole thing could be replaced by a group health policy for the players with benefits to match need.

In short, we can’t think workers’ compensation is much of a benefit for the players to throw the whole world of college football/sports and scholarships upside-down about. There have to be better paths to remedy the problem. We haven’t seen one compelling reason to change all of it.

How About Federal and State Income Taxes? Aren’t These Players Fighting for the Right to Pay Union Dues?

Please note the football players at Northwestern basically agree their annual scholarship “compensation” or “income” is tax-fee income of up to $76,000 a year. To net that much income if they are going to be taxed, you would have to pay each player from the third-string offensive tackle to the star quarterback over $100K a year.

Starting with $76,000 as tax-free income, it appears from reports there are 85 such NU athletes. The annual cost to Northwestern of 85 football scholarships at $76,000 per year is $6,460,000. There are also multimillion-dollar annual costs paid by the University for equipment, maintenance, coaches, training, transportation and lots of other things. There is an unstated assumption Northwestern University nets zillions of dollars on college football and the school is being “pigs” not to share all or more of it with the players—it is our thinking NU does somewhat better than break even during the good years and use the profits for the overall sports program. We are sure there are lots of college football programs that don’t make money.

To our understanding, for the first time in U.S. history, college scholarship money has been legally ruled to be compensation or income. Up to now, the federal government and all state governments don’t tax it. Please understand our view the lack of taxation to date is precisely because the kids are viewed as students who willingly participate in sports they love in exchange for free education, current popularity and future opportunities. College football players don’t have written employment contracts and can leave college sports to turn professional very rapidly. College football players are promised professional opportunities in and out of sport along with the fame and fun that comes with the college game.

In our view, the lack of taxation is because the kids weren’t previously viewed as employees and the money wasn’t viewed as “compensation.” For the first time, the kids now demand to be employees, contribute union dues and their scholarships have now been ruled income. At the behest of NU Football Players with the funding of the United Steelworkers, the Chicago District Office of the NLRB has now expressly decided the $76,000 in tuition, room and board is payment for services. The Feds and the State of Illinois always and routinely tax payment of income for services rendered. It is possible we may see class action lawsuits demanding government tax levies. These suits may come from ordinary folks who didn’t get the opportunity to attend Northwestern and who don’t care a whit about what would be semi-pro football players getting an undue pass on the income taxes, FICA and other things we all have to pay..

It isn’t a major leap to then add all Northwestern basketball, lacrosse, soccer or other male and female athletes as being “compensated” for their services. We assure our readers the same legal factors/principles apply to them as they do to college football players. Why can’t all those athletes be similarly taxed? And why stop with athletic scholarships—can’t all college scholarships for science, medicine, arts and other pursuits also be viewed as income for services? Can’t we tax all of those dollars? Don’t universities and colleges make untold millions off research by college students for science, software development and medicine?

If we start to treat college scholarships as “income,” can the students affected afford to pay the taxes on what they demand is their compensation? Well, the federal taxes on $76,000 are something like $20K. The 2015 Illinois state income tax that we now call the “Quinn-come tax” is at 5% is $3,800. Please note the tax monies may be due from all scholarship students to include athletes and non-athletic scholarships. Please further note if the students have to pay taxes and union dues on their scholarship income, they still have to pay their schools the missing balance due—Northwestern isn’t going to take $50K in net scholarship money when room, board and tuition are $76K.

So What is the Best Answer?

We are unsure but uncertainty clearly prevails. In our view, every college football player who excels at this lower level of sports feels they are entitled to much more than they receive. We are also sure the college football system could be improved in lots of ways—what system can’t be improved? But to

·         Turn all college athletes and others on scholarships into university employees;

·         Unionize all college athletes or others on scholarships;

·         Provide global WC benefits and

·         Make college scholarships taxable income

is going to be a major transition. This may go all the way to SCOTUS (Supreme Court of the United States) before it ends. We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: IL WC Appellate Court Affirms Denial of Deep Venous Thrombosis Leading to Trucker’s Passing. We Note No “Quantitative Risk;” No “Traveling Employee” Issues Involved.

Editor’s comment: This is an appellate ruling with which we strongly agree. Our single academic concern is the IL WC Appellate Court’s continued determination to “non-publish” many of their important, well-researched and detailed rulings that many observers consider crucial for all sides to understand. Please remember this claim had to have at least $1M in benefits at stake. We think when that amount is in dispute should mandate normal publication.

In Sherrod v. Star Transport, issued in Feb. 2014, Decedent Sherrod began working for Respondent, Star Transport, Inc. (Star), on May 1, 2008, as a long haul truck driver. Before he was hired, he underwent a physical examination and was found medically fit for the job. Upon commencing his employment, Decedent began a probationary training period with Star.

On June 15, 2008, about five weeks into training, he was on a route from Florida to Peoria, Illinois, when he stopped in Lebanon, Tennessee, for the night. When Decedent failed to check in with Star on that date, Star contacted the management of the hotel in which Decedent was staying. A hotel manager subsequently found Decedent lying on the floor of the hotel. An ambulance was dispatched, and Decedent had passed at the scene.

Upon learning of the death, Claimant authorized Tennessee officials to conduct an autopsy on Decedent in order to rule out foul play. According to Claimant, Decedent was not actively “sick” at the time of his death, but had suffered from chronic asthma for which he took over the counter medication. Decedent's fiancé testified in telephone conversations she had with Decedent during his training, he stated he complained to Star about pain and swelling in his leg, and also told his fiancé he was "in the truck constantly and did not have access to the rest area of the cab of the truck." The fiancé also testified she could hear Decedent wheezing in these conversations.

The only expert testimony in this case came from medical examiner Dr. Stacy Turner, who performed the autopsy on Decedent, and testified by deposition on behalf of the claimant. Dr. Turner testified Decedent died in a natural manner and his death was caused by a pulmonary embolism originating from deep vein thrombosis of the leg. Most likely, a blood clot formed in his leg and traveled through his body and into the lungs, causing a pulmonary embolism. According to Dr. Turner, the exact cause of deep vein thrombosis (DVT) is not often known, but it could result from many different things, such as problems with the blood itself; problems with blood vessels or blood flow; injuries; hereditary predispositions; and stasis, which means being still for a long period of time. Dr. Turner testified that obesity and an enlarged heart are also risk factors, and, based upon her examination, Decedent had a significantly enlarged heart and was obese.

Dr. Turner indicated that sitting still for a continuous period of time could cause an abnormal blood clot to form, or result in the formation of additional clots if a clot was already in existence. Although Dr. Turner acknowledged DVT could exhibit symptoms such as a swollen leg, she testified that the autopsy did not indicate Decedent had any leg swelling. When asked about the likelihood someone could develop DVT when being required to sit for days at a time, Dr. Turner responded there was no way to tell, and it would be different for each individual.

On cross-examination, Dr. Turner testified that she could not give an opinion as to whether Decedent's work activities led to his DVT or to the pulmonary embolism that ultimately caused his death. She further indicated that she had no idea of the time sequence in which the blood clot formed or when it traveled through the decedent's body to cause the pulmonary embolism. Finally, she was unable to say that the prolonged sitting lead to the blood clot that caused the decedent's death in this case. According to Dr. Turner, she was not provided information as to the length of Decedent's employment as a truck driver or trainee or how much time he spent driving. She further indicated she did not have any of the decedent's medical records prior to the occurrence.

Driver logs were critically important—Decedent was employed by Star for six weeks. He drove an average of 34.5 hours a week. In our view, that isn’t a lot of sitting, as it is about 20% of the time in a 168-hour or 7-day week.

From the evidence, the Arbitrator denied the claim. The IL WC Commission wrote a solid and excellent opinion which carefully weighed the medical/expert evidence and noted there was no clear opinion on causal connection in the record. To the extent Dr. Turner opined “prolonged sitting” might contribute to DVT, she also outlined lots of other factors, like the personal conditions of obesity and an enlarged heart could have caused the issues leading to death.

Unlike the IL WC Appellate Court’s ruling in the controversial ruling in Village of Villa Park and its progeny, the Court’s majority didn’t go into the ‘qualitative” and “quantitative” analysis of risk. We are also ecstatic to report the IWCC and this Court didn’t even mention or analyze the facts based on their previous and controversial expansion of the “traveling employee” concept. We assume IL truck drivers are no longer implicitly defined as “traveling employees” and each injury claim has to be viewed on its merits, as in years past. The IL WC Appellate Court simply affirmed making the double-negative finding the IWCC’s ruling wasn’t against the manifest weight of the evidence.

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

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Synopsis: The IL Workers’ Comp Lawyers’ Ass’n CLE’s for the IL WC Industry--Dealing With Impairment Ratings at the IWCC. Thoughts and Analysis by Michael Shanahan, JD.

Editor’s comment: On March 27, 2014, the concept of impairment ratings was presented by WCLA in a continuing legal education format. We salute the officers of WCLA for making such presentations open to the public. A point/counterpoint discussion was held to highlight how the IL WC Commission has treated the 5 statutory factors relating to impairment ratings in the recent decisions and the trends that have emerged.

This past week senior WCLA reps discussed the five factors of permanent partial disability under Section 8.1b and how the Commission has treated each factor in recent decisions. As we know by now, for injuries occurring after September 1, 2011, the level of an injured worker’s permanent disability is statutorily based on the following factors:

(i)            Medical impairment rating;

(ii)          Occupation;

(iii)         Age;

(iv)         Future earning capacity; and

(v)          Evidence of disability corroborated by treating medical records.

As to the first factor, the Illinois Workers' Compensation Act explains how the AMA guidelines are to be used. Section 820 ILCS 305/8.1a "Determination of permanent partial disability" provides that, "for accidental injuries that occur on or after September 1, 2011, the most current edition of the American Medical Association's ‘Guides to the Evaluation of Permanent Impairment' shall be used by the physician in determining the level of impairment."

The single most important aspect of the first factor, which is cited in nearly every Commission decision, is the distinction between disability and impairment. The AMA Guide does not evaluate “disability” - it rates “impairment” and impairment does not necessarily mean disability.

The second factor and fourth factor (occupation and future earning capacity) are closely tied so we will discuss them together. The WCLA discussion suggested veteran and knowledgeable lawyers on both sides may present evidence on not only the current occupation, but all work experience. Providing the total picture of work history may show the injured employee has recovered and is now capable of adjusting to new positions and learning new skills. Transferable job skills and adaptability are fundamental to employability and employability is inherent in determining future earning capacity.

Next, a worker’s age. While this may seem innocuous and straightforward, do not be lulled into cutting corners. With regard to age, it seems the trend is best exemplified as follows:

·         The younger the worker, the longer the work life expectancy, the more PPD

·         The older the worker, the more residual effects/less time to recover, the more PPD.

Any way you slice it…it seems like it goes the other way for those of us on the Respondent’s side. So, what can we do? A colleague made a great point – there are plenty of 60 year olds who are as healthy as 40 year olds. On the flip side, there are plenty of 40 year olds who have the misfortunate health of some declining 60 year olds. Our job is to argue for inferences. For example (not to pick on older guys/gals), we could argue the older guy/gal will not be living with disability as long as a younger worker.

The fifth and final factor requires evidence of disability “corroborated” by treating medical records. The statute gives examples of impairment such as loss of range of motion, loss of strength, atrophy of the tissue, or any other measure that establishes the nature and extent of the impairment. These and other impairment measures must be “corroborated” by treating records. Based on recent Commission decisions, it seems corroborated has been interpreted to mean the testimony is “credible and generally consistent” with the treating records. Looking beyond the bias of a treating doctor towards a patient, it seems the Commission has taken a somewhat varied approach. Some decisions look to records of the last visit while others will examine the diagnosis, necessity of surgery, and/or course of treatment.

In our view, the bottom line for the veteran lawyer on either side is analyze each and every factor individually and provide evidence favorable to your case. This article was researched and written by Michael Shanahan, JD. The opinions Mike is voicing are his and not those of any member of WCLA or its board. Mike can be reached 24/7/365 for questions about WC at mshanahan@keefe-law.com.

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Synopsis: One Reason to Study History is When Illinois Legislators Make Mistakes, We Remember They Aren’t New and We Made Them Before.

Editor’s comment: Along with the “Quinn-come Tax” at 5% of income we mention above, we were less-than-thrilled last week to hear House Speaker Madigan is pushing for a constitutional amendment we call the “Madigan-Hates-Millionaires” Tax. It will mean anyone who brings in $1M a year or more will now owe our state 8% of that income over and above federal tax. Speaker Madigan promises the money will be used “for the kids” which we consider both irritating and misleading. Please note the most recent and largest tax increase in IL history went 100% to fund what we call “lifetime pay” for former government workers who are back on our payroll despite the fact they left government employment years ago..

If you ask, what does this have to do with workers’ comp, we point out Illinois used to have a vibrant and growing economy. Illinois WC claims used to run at about 75,000 each year. Last year, we would have been lucky to be at 60% of that total. Jobs are leaving our state and unemployment is skyrocketing. Governor Quinn and Speaker Madigan aren’t helping to create new jobs or a business-friendly environment with their recent announcements. In our view, their overriding goal is to make sure government workers have cush jobs and even cushier retirements.

We remember in March 2007 when Crooked Blago was bashing businesses and calling corporate leaders “fat-cats.” In response, Rich Daley, the powerful Chicago mayor said he didn't appreciate the business bashing as Blagojevich tried to rally support for what was then the biggest tax increase in Illinois history to pay for education and health care.

Daley especially didn't like the characterization of business people as "fat cats." At the time, Daley said it was important to remember Illinois businesses don't have to stay in the state. "If you wanna beat up businesses, go beat 'em up and when they leave, just wave to 'em and they're gonna wave back to you," Daley said.

Now Speaker Michael Madigan is going to attack/smack business leaders with the highest combined income tax in Illinois history. The numbers are shocking and won’t be well received by any successful businessperson living in this state. Each and everyone one of them are thinking about waving back to Speaker Madigan as they move elsewhere.

For a couple of interesting examples:

Bulls All-Star Center Joakim Noah makes $12M a year. If his career last ten years, he will be very lucky—he has to make what he can while young and healthy. He is in the middle of a five-year contract. The combined 5% Quinn-come tax and the added Madigan-Hates-Millionaires Tax of 3% will cost Joakim Noah almost $1M each year, actually $960K to remain in Illinois. If he moves from IL to Merrillville or Dyer, Indiana, he would save almost $5M over the five year contract. That would pay for a very nice crib somewhere else.

For Chicago Bears QB Jay Cutler, the savings to move out of Illinois would be even higher. The combined IL taxes will cost him $1.44M each year or about $10M over the term of his new 7-year contract. QB Cutler will save 8-figures over the term of the contract to get out of our state.

The top five companies that remain willing to be headquartered in Illinois are ADM, Walgreens, Boeing, State Farm and Caterpillar. All of their CEO’s and executives are now subject to Speaker Madigan’s new anti-business tax. Trust us, none of their executives are happy with the State of Illinois.

We ask the rhetorical question--why would any member of the Bears, Bulls, Sox or Cubs live in this state? Why would the execs of any of the companies listed above be happy to hear of the Madigan-Hates-Millionaires tax? Why would any successful doctor, lawyer, accountant, stockbroker or other business person stay here?

Where is the money going to go? We assure you lots of our tax dollars are going to pay lifetime pay for lots of former government workers that don’t contribute nearly enough to justify what they get after leaving public work:

·         Legislators in Illinois only have to work/contribute for four years of government work to get lifetime pay in the millions;

·         IL Judges/Justice only have to work/contribute for 9 years to get $9 million or more during the rest of  their lives or as much as $1M for each year of service—becoming a judge is like winning the lottery in Illinois (if you want the math, send a reply);

·         Chicago public school teachers only contribute 2% of their salary to their “pensions” or what we call lifetime pay  each year—after 20 years, they haven’t contributed ½ of one year’s salary to their lifetime pay and they get it all back within six months of leaving work. Thereafter, Chicago taxpayers are picking up the tab or our Mayor is going to borrow to pay the tab and our grandkids might be able to pay it off.

We remain concerned about the biggest problem with Illinois—no one in government is doing anything to truly address the many cost-cutting possibilities to make our state or its largest city efficitent, effective and still provide good schools, roads and other needed concepts. Things are simply swirling down and down under the current administrations. If you want our simple thoughts about how to start effectively cut Illinois/Chicago governments, send a reply.

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

3-24-14; Post-Primary Report on How to Improve the IWCC; Louisiana MSA Ruling Provides Guidance on Fee Claims; Opioid Epidemic Attacked! and much more

Synopsis: Post-Election News—Should We Try to Get the Illinois Workers’ Compensation Commission Ready-For-Rauner Or Keep Making Progress Under the Current Administration?

Editor’s comment: As we predicted, upstart candidate Bruce Rauner basically came from nowhere to sweep to become the Republican candidate for Governor. The oddest aspect of the primary was the millions spent by government unions to support Mr. Rauner’s leading Republican opponent and the phone calls and pleas for Democrat voters to cross over and vote against Mr. Rauner, rather than for anyone. The coming fall election in Illinois is starting to take on the appearance of the Governor’s election in the State of Michigan a couple of years ago where both sides spent over $50M to elect a governor to a post that pays about $175,000 a year. The battlefront isn’t over the job itself; it is over the billions of dollars in contracts and positions the job controls.

What is mildly bizarre is the response by veteran politicians to the outcome of the primary. IL House Speaker Mike Madigan has called for a special billion-dollar-plus tax levy on, well, himself and other Illinois millionaires. We assume this is another shot at Bruce Rauner but we are also sure Mr. Madigan’s personal wealth has to be in the $50M-150M range as he has been in IL state politics for decades and makes millions each year off the silly “tax appeal” concept where our Cook County Assessor always overvalues real estate taxes to then have attorneys like Speaker Madigan, Senate President Cullerton and Chicago Alderman Ed Burke step in to have their law office staff attorneys supposedly appeal and “correct” the mistakes and then haul away millions every year in attorney fees. Yes, you might note how crazy and conflicted it sounds for our top state leaders to make millions working to randomly lower real estate taxes for their clients so other taxpayers have to pay even more money to make up the shortfall. One also has to wonder when and if our government leaders might buy Cook County Assessor Joe Berrios one of those new-fangled “computers” so he might get the initial assessments correct and avoid all the appeals, attorney’s fees and uncertainty.

Either way, we have never heard of a billion-dollar-plus tax increase being pushed by the incumbent party during an election year. Illinois Democrats are also pushing for a mandatory retirement program for all businesses large and small along with a 21% increase in our state’s minimum wage. It would appear the anti-business, anti-competitive atmosphere in Springfield is going to continue until the fall of this year.

From the perspective of the Illinois Workers’ Compensation Commission, we again hope to provide some thoughts on getting “Ready-For-Rauner” if you feel he has a realistic chance to be our next Governor. If it turns out Mr. Rauner doesn’t prevail, the same concepts may also serve the continuing administration of the IWCC under incumbent Governor Quinn. There are three issues we see that could be addressed moving forward.

First, every single Republican primary candidate said “causation” in our workers’ comp system was their main campaign concern. We have been telling everyone who will listen it is our academic view “causation” in workers comp can’t be changed by legislation. It is our view any legislative scheme on the topic that you propose can be avoided by wily administrators and reviewing courts. For example, if you write legislation requiring work be the “sole and primary cause” of a medical problem, a liberal or radical administrator can always rule the work was the sole and primary cause of the medical issue. You tell me how to write common sense into the legislation and we will happily pass it along to the IL State Chamber’s new President-To-Be Todd Maisch.

Please also note the Appellate Court, Workers’ Comp Division has quietly moved to a new and very liberal causation standard, right before our very eyes. In the recent Village of Villa Park v. IWCC ruling, they outlined an unprecedented criterion that we wholly disagree with. The penultimate reviewing court has indicated the IL WC industry is supposed to look at both “quantitative” and “qualitative” work activities in analyzing an accident or the relationship of a medical problem to work. If you read Matt Ignoffo’s analysis of the Dixon v. IWCC ruling last week, the reviewing court issued a similar analysis in a Rule 23 or “non-published” decision indicating the Appellate Court’s view this concept no longer needs to be promulgated to the larger public—a Rule 23 decisions means it is a routine legal concept for this Court.

In the controversial ruling in Village of Villa Park outlined above, the “quantitative” risk leading to a compensable or “causally connected” injury was regularly walking on stairs. In the Commission’s nomenclature that was adopted by the Appellate Court ruling, the employer “forced” the employee to walk a flight of stairs about six times each shift. Where is Upton Sinclair when you need him to again reform the Illinois workplace? One of the wags at our office said we should call OSHA in to investigate the horrible working conditions which require such involuntary servitude climbing stair after stair in this otherwise peaceful Illinois village. Kidding aside, we don’t see how the actions of traversing a staircase six times in an eight-hour shift is either “forced” work or “quantitatively” unusual. Please note the case went to the Appellate Court and resulted in an award of full benefits without any indication or evidence of a safety failure, sudden event or trauma or anything your grandmother might think would be part of a work “accident.”

I would challenge any of our readers to create legislation that ends or overrules the concept above. Please note our view the model being pressed by the Court and Commission panel is just about impossible to defend, as it is our view millions of IL workers walk on staircases six or more times a shift. If that activity defines an accident in this state, most work is similarly “accidental.” In short, to change this concept, you have to have a Commission panel that focuses on traditional accident analysis of an increased risk with some sort of safety failure causing bodily injury.

We do feel IWCC Chairman Michael Latz and newly appointed IWCC Secretary Ron Rascia know the issues involved and they continue to work to make sense of our challenging laws and rules. Our concern isn’t with them, it is with the Commissioners who support “quantitative risk” as the basis to define accidental injury for someone who walked on stairs six times in eight hours—would it have been denied if the worker was only “forced” to be on the staircase twice? Four times?

Second, we assure all of our readers, clients and friends, the second major issue in getting Ready-For-Rauner or remaining with the current administration is the problem of endless WC claims. We assure everyone the defense team at KCB&A can work with you to close your five to ten year old claims much faster than your current defense attorneys. If you want a free audit to give you the needed action plan on your oldie and moldy IL claims, send a reply.

But even with our hard work and defense strategies, the rank-and-file work injury claim in the IL WC system sometimes moves slower than molasses in January. The “worst” states in the United States for workers’ comp are the states that don’t bring closure to their pending book of claims. In our view, the Arbitrators and Commissioners should continue their progress to rein in delays and get serious about closure. We long for the day where our computer-savvy Arbitrators will hold a pretrial like the judges in federal court and outline a discovery schedule for both sides and then adhere to it. To the extent we have 30 or more Arbitrators on salary in Illinois, we have the staff necessary to move claims much more efficiently.

Finally, this leads to the last of the major issues we have with Illinois government efficiency. With respect to Chairman Latz and everyone else at the Commission, the place remains a bloated bureaucracy. With an annual budget of about $30M, we feel the IWCC could thrive and survive on half that much money. There is never a sense of efficiently and effectively spending taxpayer dollars. For one simple example, we still feel there is little need for the three IWCC “satellite offices” that do little more than print workers’ comp forms that can be accessed just as easily by the public online. We consider it truly odd to have a satellite office in Collinsville that hasn’t been staffed in about two years—why not just get rid of it?

So whether you like Bruce Rauner or the incumbent, keep your eyes peeled for developments leading to the November election. In our view, if you like the progress made by the current administration, stick with them and vote Democrat. If you want a change, vote for Mr. Rauner who has vowed to “shake up Springfield.”

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

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Synopsis: Louisiana Ruling Denying Attorney Fee Claim on MSA Trust Funds in a WC Settlement May Provide Guidance for IL Claims Adjusters, Hearing Officers and Arbitrators.

Editor’s comment: We have heard this debate rage back and forth. In the states we provide defense services, we haven’t seen an Illinois, Indiana, Wisconsin or Michigan ruling on this precise fact situation. We also know Louisiana has been a traditionally Plaintiff-oriented state.

In Benoit v. MMR Group, et. als, issued March 19, 2014, Claimant and counsel settled the indemnity portion of the claim for $30,000. The medical aspect of the claim settled in an approved MSA trust for $50,846.00. The amount was approved and was further determined to adequately protect Medicare’s interests.

Mr. Benoit’s attorneys filed pleadings to allow them to recover attorney’s fees on the seed money for the MSA Trust. When they were initially denied, they filed for reconsideration and later appealed denial.

The Appeals Court noted the MSA agreement specifically states:

The Medicare set-aside funds in this case are to be self-administered. The Claimant has been provided with the directives issued by CMS regarding his rights and responsibilities in this regard. The Claimant understands that the MSA funds must be placed in an interest- bearing account, and this account must be separate from the individual' s personal savings and checking accounts. The funds in this account may only be used for payment of medical services related to the work injury that would normally be paid by Medicare. If payments from this account are used to pay for services that are not covered by Medicare, Medicare will not pay injury-related claims until these funds are restored to the MSA account, and then properly exhausted.

The Court ruling highlighted the language “The funds in this account may only be used for payment of medical services related to the work injury that would normally be paid by Medicare.” The Court felt such language was crystal-clear and limited any portion of the money from being used for attorney’s fees, expenses or any other aspect of the litigation. The decision is available to review online at http://www.la-fcca.org/opiniongrid/opinionpdf/2013%20CA%200537%20Decision%20Appeal.pdf

The problem for the Petitioner-Plaintiff bar is they don’t like to work for free. In this claim, there is no question the lawyers for Claimant worked to get their client a medical benefit of about $50K. The concern on the other side of that coin is there isn’t truly any solid “source” for a legal fee—if money is taken from the Medicare Set-Aside, taxpayers lose out when we have to pay for work-related medical care.

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

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Synopsis: S&H Medical Management Takes on the Opioid Epidemic.

Editor’s comment: We have all heard about the Opioid Epidemic, and the toll it is taking on society and on healthcare costs. However, what about an integrated solution that specifically addresses this issue in the workers’ compensation setting? Has your case management provider discussed with you their approach to address and mitigate the costs of this epidemic on workers’ compensation claims?

S&H Medical Management Services, Inc. has researched best practices to provide an integrated approach to this crisis based on ACOEM guidelines, and various states have developed their own internal Opioid Guidelines. As a result of this research, S&H has set up protocols for working with the physician, the injured worker, the claims handler, the attorney and the pharmacy benefit manager at the time an opioid is prescribed, and through subsequent prescriptions. The S&H Consultant works collaboratively with the prescriber to explore alternatives to opioids, and to ensure treatment protocols based on current best practices are explored. The goal of these protocols are to increase function and eliminate any prescribed opioids either before they are prescribed or as soon as possible during treatment. The question the S&H RN is trained to ask: “If the opioid is not facilitating decreased pain and increased function, then why is the injured worker receiving an opioid?”

The S&H Consultant obtains detailed information from the treating physician regarding the exact opioid and dosage. Utilizing best practices, S&H completes a Medication Reconciliation Assessment during the Initial Evaluation Meeting. The Nurse Consultant utilizes tools documenting specific pain levels and its interference with functional levels at each appointment assessing for response to the opioid and consistency in reporting. This assessment is shared with the treating physician.

Utilizing a morphine dosage calculator, Total Morphine Equivalent Dosages (MED) are calculated along with the length of time the opioid is prescribed. Assessment for aberrant drug behaviors is also completed on an ongoing basis. Advancement through the S&H opioid protocols are based on these calculations and assessments. Information regarding safe handling, usage and storage of the opioid is provided to the injured worker.

The physician is requested to utilize the state-specific Prescription Monitoring Program each time an opioid is prescribed, and pill counts may be requested at appropriate intervals at in-person appointments.

With the client’s authorization, at the point in which urine drug testing or a peer to peer review including telephonic intervention is appropriate (utilizing criteria set forth at the time the opioid is prescribed), the S&H partner that provides cost-effective Urine Drug Screening with GCMS and Peer to Peer reviews that specifically address the appropriateness of ongoing opioid prescribing or weaning can be utilized. Should the client have their own providers, the Nurse Consultant will alert you to the appropriate timeframe for intervention and be happy to work with this vendor.

Should our client decide to work with our partner providing these services they do so knowing S&H has negotiated favorable pricing with our partner and their goal is to keep your IW off any unneeded opioids and to do this as soon as possible! In addition because the S&H Nurse Consultant is working closely with the prescribing physician and the injured worker, they assess adherence to any plan agreed upon during the Peer to Peer Reviews/Meetings. As a result, any RN assessments are provided by the S&H Nurse Consultant, during regularly scheduled appointments, thereby saving the costs of the RN assessments and follow-up normally completed by these vendors.

S&H Medical Management Services, Inc. believes these protocols will mitigate the costs opioids are exacting on your claims and on our society!

3-17-14; IL Medical Marijuana Law May Be The Best Reason to Go Alcohol and Drug-Free; Matt Ignoffo, JD Fights/Wins a Fall-Down Ruling; IL WC Statutory Interest Redux; Happy St. Paddy's and much more

Synopsis: Our New Illinois Medical Marijuana Laws May Be The Best Reason to Make Your Workplace(s) Alcohol and Drug-Free.

Editor’s comment: We have had so many readers and clients ask, we want to provide clear thoughts for HR, Safety and Personnel managers in dealing with this new challenge. On January 1, 2014, the Compassionate Use of Medical Cannabis Pilot Program Act (CUMCPPA) went into effect in our state. Basically, the Act provides if you have a listed medical condition and want to use marijuana for it and if your doctor approves, you can smoke weed basically to your heart’s content. In lots of industries, we consider that a dramatic rise in risk. We are confident underwriters across the U.S. who are evaluating projected insurance premium costs are certain to start asking what you are doing about this new and unprecedented change to your workplace. We aren’t sure why more carriers aren’t mandating alcohol/drug-free programs.

There are new administrative rules that have been posted about this new law—they have four months to put them into place. The IL Departments of Revenue, Agriculture and Financial and Professional Regulation posted draft rules online to address how dispensaries and cultivation centers will be regulated and taxed. The proposed rules include provisions for how cultivation centers must package and label the marijuana. They also say that 21 of the 60 dispensaries required under the law would be outside of the Chicago metropolitan area. The Illinois Department of Public Health previously posted rules for patients, including requirements for fingerprinting, background checks and a $150-a-year photo ID. The new state law with these combined regulations present some of the strictest standards in the nation. They can be viewed online: http://mcpp.illinois.gov

On a common sense note, we ask everyone why medical marijuana isn’t in pill form? Does it make any medical sense for patients to be smoking it? What is all the Grateful-Dead-like excitement about growing weed, wrapping it in bags, rolling it with papers and smoking doobies? A Canadian study from last fall demonstrated a strong link between smoking marijuana and lung cancer. We are aware there are other research studies that don’t support the lung cancer conclusion but the nature of the research wasn’t scientifically significant in some of them. Either way, why take a chance? Is the romance of rolling numbers that strong? We feel if patients and doctors feel the therapeutic benefits of marijuana are necessary and ameliorative for some medical conditions, we consider it nonsensical to have patients smoke what they could simply take much more safely as a pill with a glass of water.

But we digress. One strong aspect of IL medical marijuana laws are clear—if you have a drug and alcohol-free workplace program, you don’t have to allow your workers to fire up their roaches before or during work. The language of the CUMCPPA says (in pertinent part):

Section 50. Employment; Employer liability.

(a) Nothing in this Act shall prohibit an employer from adopting reasonable regulations concerning the consumption, storage, or timekeeping requirements for qualifying patients related to the use of medical cannabis.

(b) Nothing in this Act shall prohibit an employer from enforcing a policy concerning drug testing, zero-tolerance, or a drug free workplace provided the policy is applied in a nondiscriminatory manner.

(c) Nothing in this Act shall limit an employer from disciplining a registered qualifying patient for violating a workplace drug policy.

(e) Nothing in this Act shall be construed to create a defense for a third party who fails a drug test.

This language was designed to protect the right of Illinois employers to strongly block the use of medical marijuana at your place of business. In fact, we feel it strongly encourages all employers who haven’t started alcohol and drug-free workplace programs to get going with them. In fact, as attorneys, we cannot see any downside to getting a program in place. To the contrary, if you don’t get an alcohol and drug-free workplace program moving, you are taking the chance that your workers will randomly fire up cannabis cigarettes and arguably become less safe to themselves, their co-workers and the public.

Please also note there is a derivative value in using the new Medical Marijuana law/rules to get moving into the Alcohol and Drug-Free Workplace protocols. It will make your whole workforce safer! If you spend the extra time and a little money needed to start watching your workforce and get everyone clean and sober all day, you are going to have less accidents, near-misses and better mod rates. Remember, the cost of just one accident caused by an impaired employee can devastate a small business.

Although not required by the Occupational Safety and Health Administration (OSHA), drug-free workplace programs help ensure safe and healthy workplaces and add value to America’s businesses and communities.  Such programs help reduce occupational injuries and illnesses and send a clear signal that employers care about their employees. A comprehensive drug-free workplace program generally includes five components:

1.    A written alcohol and drug-free program with dissemination to your workforce.

2.    Supervisor/Manager training;

3.    Employee education

4.    Employee assistance or EAPs; and

5.    Drug testing. 

1.    Written Program with Dissemination to Your Workforce

Defense team at KCB&A has a written alcohol and drug-free workplace policy for your consideration and use. If you want a draft copy, send a reply. That said, your organization’s program should be tailored to meet your specific needs and we are happy to assist, as you feel necessary. All effective programs have traits in common, including why the policy is being implemented, a clear description of prohibited behaviors, and an explanation of the consequences for violating the program requirements.

Disseminating the program to your workforce is crucial for it to be successful. We suggest spending the money on handbooks, workplace signage and repetitive/regular discussions of the concept at employee meetings.

2.    Supervisor/Manager Training

After finalizing your program, your organization should train those individuals who are going to be on the front lines and enforce it; your supervisors and managers. Training should insure your enforcers understand the alcohol and drug-free workplace program including ways to recognize employees with small to large impairments or who have performance problems that may relate to banned substance abuse. You also have to train your supervisors/managers on how to refer line employees to alcohol or drug assistance or for drug testing as needed.   Supervisors/managers should be trained not to diagnose substance abuse problems or provide counseling to employees who may such issues—lots of issues can erupt if that path is taken. Make sure your supervisors/managers know their role.

3.    Employee Education

A drug and alcohol education program provides your employees with information they need to cooperate with and benefit from a drug-free workplace program.  Effective programs provide company-specific information, such as the details of the company’s policy, as well as general information about the nature of addiction; its impact on work performance, health and personal life; and help available for related problems.

4.    Employee Assistance Programs or EAPs

A critical component of a drug-free workplace is providing assistance to employees who have problems with alcohol and other drugs. Employee Assistance Programs (EAPs) are worksite programs that provide problem identification, assessment and referral services for employees.  They are effective vehicles for addressing poor performance that may stem from an employee’s personal problems, including substance abuse. 

5.    Drug Testing

Employers decide to drug test for a variety of reasons, such as blocking or identifying drug use, as well as providing evidence for needed intervention, referral to treatment and/or disciplinary action. We assure our readers the decision of who and when to test is where litigation typically arising. Before deciding for protocols on testing, employers must consider certain factors, such as who will be tested, which drugs will be tested for and when and how tests will be conducted. We strongly suggest you consult with the defense team at KCB&A about your testing practices and procedures.

All in all, we don’t see a downside. Please don’t let your business be at risk for dangers that come from now-legalized marijuana users along with alcohol and other drug abuse. Start and stick with a program and stay even with your competition. We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: KCB&A’s most recent Illinois Appellate Court win came in last week!!! Petitioner’s Unexplained Fall Not Compensable as Petitioner Not Subjected to a Risk Greater than the Public.

Editor’s Comment: Risk managers and clients across the state are dealing with fall-down claims due to the difficult winter in the Midwest U.S. We feel some claims adjusters pull the trigger toward compensability much to quickly—if you have the right facts, fall-down claims can be won.

The facts in Dixon v. Rush University Medical Center (No. 1-13-1350, March 10, 2014) involve an accounting clerk who, when returning from a cigarette break, fell in the main entrance of the hospital. Petitioner testified she, “slipped on the rug and the rug slipped straight from under me.” She presented for ER treatment and although she returned to work a subsequent recommendation was made for a lumbar fusion. The matter proceeded to hearing and the Arbitrator awarded benefits along with the prospective surgery. We appealed to the Commission and all three Commissioners denied the claim finding no increased hazard and no risk greater than the general public. Surprisingly, the Cook County Circuit Court reversed and we appealed the matter to the Appellate Court, Workers’ Compensation Division.

The Appellate Court majority cited case law discussing employee falls: To determine whether a claimant's injury arose out of her employment, the risk to which she was exposed must first be categorized. Baldwin.

Risks to employees fall into three groups:

1. Risks associated with the employment;
2. Risks personal to the employee, such as idiopathic falls; and
3. Neutral risks that have no particular employment or personal characteristics. Id.

Petitioner here acknowledged the risk of falling while walking, as in this case, is considered a neutral risk. Injuries resulting from a neutral risk generally do not arise out of the employment and are compensable under the Act only where the employee was exposed to the risk to a greater degree than the general public. Metropolitan Water Reclamation District.

Evidence an employee is exposed to the neutral risk of falling to a greater degree than the general public may be either qualitative, such as when the fall results from a defect in the employer's premises or when some other aspect of the employment contributes to the risk, or quantitative, such as when the employee is exposed to a common risk more frequently than the general public. In order for an injury caused by an unexplained fall to arise out of the employment, a Petitioner must present evidence which supports a reasonable inference the fall stemmed from a risk related to the employment.

Here, there was no evidence presented indicating any aspect of Petitioner’s employment contributed to the risk. The Commission held, based on Petitioner’s testimony and the medical records, it was unknown whether the rug slipped, if Petitioner slipped on the rug, or if she tripped on the rug. There was sufficient evidence to support this determination.

It was next discussed by the Appellate Court whether the injury resulted from a condition of the employer’s premises. Petitioner claimed the rug itself was somehow a “hazard,” but we countered arguing there was no evidence in the record indicating this. The Appellate Court agreed with usand acknowledged there was nothing in the record to indicate the rug was either defective or hazardous. As such, there was a reasonable basis for the Workers’ Compensation Commission to infer the condition of the premises was not the cause of Petitioner’s injury.

Finally, the Court examined whether Petitioner was subjected to a greater quantitative risk than the general public because of her employment. Petitioner offered no evidence of the frequency with which she took the path where the fall occurred. The Court cited the First Cash Financialcase for the statement of law indicating by itself, the act of walking across a floor at an employer’s place of business does not expose an employee to a risk greater than that faced by the general public. There was nothing in the record here to distinguish Petitioner’s risk in traversing the entrance from the risk to the general public. As the Commission’s decision holding Petitioner failed to prove she sustained accidental injuries arising out of and in the course of her employment was within the manifest weight of the evidence, the Circuit Court order was reversed and the Commission denial reinstated.

As you can see, fall down cases are very fact specific and merely because a worker falls at work, or while working, and gets injured does not mean the case is compensable under the Act. If you are handling such a case feel free to contact us to discuss the best way to move forward and how to position the case for denial.

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

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Synopsis: Statutory Interest on IL WC Medical Bills, Part II.

Editor’s comment: We have had lots of inquiries and concerns voiced about the article from the KCB&A Updatelast week indicating there is a well-known medical provider now suing insurance carriers and TPA’s in Circuit Court for recovery of statutory interest on IL WC medical bills. We wanted to provide our readers and clients a few additional thoughts we received from all of you!

·         First, we note many of the Circuit Court claims for 12% annual statutory interest are being filed after the underlying WC claims have been settled with IWCC approval or Arbitration/Commission decisions have gone final. The theory being employed in bringing such claims is the medical provider is a “third-party beneficiary” of the language of the IL WC Act. We don’t consider that approach to be well-founded from a legal perspective—we don’t feel a Circuit Court can or should retroactively relitigate WC issues. For example, it doesn’t make sense to us for a Circuit Court to add a post-decision penalty for late payment of medical bills under Section 19(l) of the IL WC Act. Either way, we are all going to have to wait and see if the concept stands the test of courtroom battling at the Daley Center and beyond.

The main reason for our criticism of this approach is exemplified in the first lawsuit where the IWCC awarded $270,857.60 for medical expenses. We don’t know much about the underlying claim but it is our view if the Commission awarded that specific $270K amount, the employer/insurance carrier/TPA would owe that amount. If the employee wasn’t asking for and didn’t get a ruling allowing statutory interest, such interest would not be due. We don’t feel the Circuit Court has the ability to act as a “super-Commission” to add new benefits not awarded in the administrative agency.

·         This highlights the second concern about the IL WC statutory interest anomaly—in many occasions, there are substantial but very real disputes about compensability. If you read the great article by Matt Ignoffo above, you may note he was handling a claim with a dispute over fusion surgery. If that surgery had proceeded under the employee’s group health coverage, such care might have had a cost of between $50,000 to $150,000. The fully disputed accident in the claim was from January 2011 and it wasn’t decided during more than three years of hearings and appeals. In our view, the bills wouldn’t have been “due” until the final ruling and mandate of the Appellate Court, Workers’ Compensation Division issued and thereby became final. In our reasoned academic view, statutory interest would also have to wait to start once the same ruling to reach finality.

If there were no disputes and the employer/insurance carrier/TPA accepted the claim, certified medical care and received properly coded bills, we would strongly agree statutory interest would be due after the passage of 30 days and would continue to run. To get that statutory interest payment, we feel collection efforts by a medical provider should start during the pendency of the IL WC claim. In moving forward in this fashion, the Arbitrator or Commission panel could adjudicate the issues fairly for all parties.

·         We urge our clients and readers in the medical industry to fine-tune your WC medical billing collection procedures. We feel you need to develop the computer capability of not simply sending unpaid bills with proper coding on a regular basis—you should also start adding the dates of prior submission and the added statutory interest to which you are entitled under the IL WC Act. If you also send copies of the updated bills with added interest to Petitioner’s counsels, they can easily ask for the Arbitrators or IWCC panel to add statutory interest to the award. If they don’t have that documentation, we consider it very challenging to first ask for statutory interest after settling or getting a final ruling.

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

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Synopsis: One Day to the IL Gubernatorial Primary—We Join with the Chicago Tribune to Endorse Bruce Rauner in the Illinois Republican Primary.

Editor’s comment: Our goal as a news source is to remain bipartisan. Therefore, if you are a Democrat, vote for incumbent Governor Pat Quinn in the Democratic side of the tomorrow’s primary.

On the Republican side, we remain happy to see the Chicago Tribune endorse Mr. Rauner. We join with them in doing so. Please note a few fairly important things:

• Illinois taxes and highway tolls have been recently raised to record levels;
• Our state’s unemployment is wildly high; we are the 3d from the bottom of all the United States—there is no question people, jobs and businesses are leaving;
• Our state government pension debt is over $100B—this comes from what we call “lifetime pay” where our legislators, judges and most government workers only contribute a small fraction of the money needed to pay them 80% of their pay with 3% annual increases for the rest of their lives—this phenomenon means taxpayers continue to pay salaries of workers who don’t work for the state any longer and it is being hidden or shown to voters only in the most confusing fashion by our elected leaders and the media;
• Our state is effectively “bankrupt” as we haven’t timely paid bills in years and are always several billion behind;
• IL Senate President John Cullerton has openly confirmed the only path their administration has to bring government back into economic shape is to dramatically raise taxes and tolls even further;
• Illinois has 88 state agencies, many of which are admittedly redundant and duplicative; actually most of IL government is redundant/duplicative, as IL politicians like to control lots of jobs whether we need them or not;
• There are literally hundreds of ways our state government could provide the same or better services for less money but would require strong management we aren’t getting—if you want some of our thoughts on simple cost-cutting measures, send a reply.

Bruce Rauner is an amazing and successful business person.

• He is the first gubernatorial candidate in years who can’t be bribed and doesn’t owe any group political “tokens” or pay-backs;
• He will pick the best candidates for important state positions and work to select the best vendors to supply state agencies;

·         He will address the “lifetime pay” issue in a fashion the other career politicians cannot and will not;

• He will make strong decisions to save taxpayers money and cut waste and government redundancy.

If you like the status quo, vote for one of the other Republicans who all have been in our dysfunctional state government for years without any answers or plan. If you think we need a change, vote for Bruce Rauner today or at your polling place on March 18, 2014.

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Synopsis: Happy St. Paddy’s Day to our clients, friends and readers.

Editor’s comment: Please drive and party safe out there folks!