1-30-2017; The Biggest IL WC News In History That No One Is Reporting But Us!; RICO Suits To Disappear As WC Bad Faith Claim; Uninsured Motorist Loses Coverage If Too Much WC Paid and more

Synopsis: The Biggest News in Illinois Workers’ Comp History No One is Reporting—I Assure You The IL Workers’ Comp Commission Is Set To Close Thirty Days From Today!

Editor’s comment: I had a reader tell me Illinois State Government appears to be filling in for the Ringling Bros. and Barnum & Bailey Circus that is soon to close. Everything that is happening in our state government appears to make our leaders look like clowns and teetering out of control. The problem with seeing legislative clowns is the lack of any humor when billions of our tax dollars are at stake. In short, the “grand bargain” for an actual IL state budget appears to have fallen to the wayside as the battle between Governor Rauner and Speaker Madigan accelerates wildly.

Last week, Speaker Madigan’s daughter, IL Attorney General Lisa Madigan filed a request in St. Clair County Circuit Court, to stop paying all Illinois state workers' salaries until legislators and Gov. Bruce Rauner work out a spending plan to end an 18-month budget impasse.  The motion asks the St. Clair County Circuit Court to dissolve by Feb. 28, 2017 a preliminary injunction that has allowed state workers to be paid even though the Legislature and governor haven't approved a spending plan. A six-month "stopgap" state budget was approved last summer but expired on Jan. 1, 2017.

Attorney General Madigan's surprise legal motion was criticized both by government employee unions and other state officials. I feel it is an exercise in brinkmanship (brinkwomanship?) to force an unhappy budget truce. Please also note the screaming you can’t hear are the holders of over $11 billion, yes, billion in unpaid bills owed by our crazy State government—the amount of unpaid state gov’t bills is going up by millions upon millions each day.

Governor Rauner said he was "deeply disappointed, very upset" by Madigan's move. "I hope this is not a direct attempt to cause a crisis to force a shutdown of the government to force another stopgap spending plan — short-term, unbalanced, incomplete — as a step to force a tax hike without any changes to our broken system," the Governor said in Chicago.

Unless things change dramatically, it is my current assumption Attorney General Madigan will win her motion and the preliminary injunction will be dissolved. Following that ruling, all IL government salaries and other monies paid to IL State workers will end on February 28, 2017. After that date, I further assume the IL WC Arbitrators, Commissioners, Chairperson and support staff won’t volunteer their services but will stay home or away from work until the impasse is resolved. In short, the IWCC and lots of other state agencies and services will close until a budget deal is struck. Could it happen? Youbetcha.

What Happens Then? Can We Survive Without WC Hearing Officers?

It will be interesting to see what happens but an IWCC shutdown may certainly happen. The main crisis would be termination of medical and/or lost time benefits for seriously injured workers—there would be no place for such folks to go. Even Medicaid might shut down in a total government collapse. We assume the IL WC claims community isn’t going to do silly stuff because at some time, the IWCC will return to action and get back into the swing to punish defense wrong-doers.

What Is Happening With the Pending 2017 IL WC Reforms?

From my last web search, literally all sides appear more and more tired of the new WC “reform” concepts and seemed to be either losing interest or actively discarding them. Some of the WC reforms have promise but all of it seems to be rapidly cobbled together without strong metrics to support them. We assure our readers some of them are hilariously nebulous and when there is unclear WC legislation, that is never good for the defense side of the matrix because our “activist” courts will make us pay for any uncertainty.

Whether anything of the many proposed IL WC reforms will survive and be passed into law is yet to be seen—watch this space. With what is at stake in a government shutdown, my vote is back out of the few reforms of value and take the time needed to come up with “hard” reforms that will make the system operate more effectively for IL business and local governments. I am happy to quietly help, if asked.

Will The State of Illinois Ever Dig Out of the Massive Financial Hole Created by Our Legislative Leaders?

The “Grand Bargain” currently being proposed includes

·         At least $7 billion in new state borrowing for a state awash in spiraling debt and

·         State income tax being dramatically raised to record levels for individuals and corporations and

·         The stupidest tax on moderate and small businesses I have ever heard of. Some PR guy gave this proposed tax the silly name “Business Opportunity Tax.” Our legislative leaders want to raise $750M to tax payroll and 1099 payments for businesses working in Illinois. If it passes, every incentive will be to move jobs and business out of this state even faster than is already happening. In my view, the only “opportunity” that will almost certainly come from such a tax is to have businesses jump on this “opportunity” to get out of this state and bring jobs and work elsewhere.

·         Lots of other unpalatable things that will infuriate you and me, as taxpayers.

What this bargain doesn’t include are any budget cuts or government efficiencies or basically anything to get us out of the giant financial mess in the years and decades to come. If you don’t change what caused these new and higher taxes and borrowing, you are going to need more taxes and borrowing until something snaps. I feel they are simply patching up the financial mess they caused with literally no long-term relief in sight. All I see the legislature doing is fighting Governor Rauner and digging deeper and deeper into an anti-business and anti-local government financial abyss. Lots of folks and businesses are fleeing with fewer and fewer new Illinois jobs being created—does anyone in the General Assembly care?

I suggest we all diary February 28, 2017 to watch and see if they can come up with a plan that will keep the IL WC Commission open and our circus-like state government afloat.

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

Synopsis: RICO Claims To Disappear from U.S. Workers’ Comp World And Good Riddens.

Editor’s comment: If you don’t know, the Federal RICO concept was, in my opinion, created to stop Mafia folks from defrauding and extorting money from our citizens. The Racketeer Influenced and Corrupt Organizations Act, commonly referred to as the RICO Act or simply RICO, is a United States federal law that provides for extended criminal penalties and a private civil cause of action for acts performed as part of an ongoing criminal organization. The RICO Act focused specifically on racketeering, and it allows the leaders of a syndicate to be tried for the crimes which they ordered others to do or assisted them in doing, closing a perceived loophole that allowed a person who instructed someone else to do the act and then be exempt from the trial because he did not actually commit the crime personally.

About ten-fifteen years ago, WC Claimant lawyers in Michigan decided to bring RICO into the world of workers’ comp. Several lawsuits were filed and a heated battle ensued.

Now a Michigan Federal Court just again ruled RICO may not be used for workers’ comp bad faith claims. Citing two earlier precedents, a U.S. District Court in Michigan has once again ruled, in pertinent part, that racketeering activity leading to a loss or diminution of workers’ comp benefits a plaintiff expects to receive under a state workers compensation system does not constitute an injury to “business or property” under the Racketeer Influenced and Corrupt Organizations (“RICO”) Act. Accordingly, where an injured worker alleged a claims conspiracy, pursuant to which the workers’ compensation insurance provider hired IME or other doctors to write allegedly fraudulent reports for the purpose of denying his workers’ compensation benefits, the worker stated no demonstrable cause of action.  

In Gucwa v. Lawley, the worker sought to distinguish earlier decisions—Jackson v. Sedgwick Claims Management Services, 731 F.3d 556, 563–64 (6th Cir. 2013) (en banc), and Brown v. Cassens Transport Co., 546 F.3d 347, 354 (6th Cir. 2008)—on the grounds in his own case, he alleged tortious activity by “independent medical examiners.” The U.S. District Court held the worker’s argument was meritless and a motion to dismiss granted.

As I have advised my readers on many occasions, if RICO were to come into the world of workers’ comp, the same sword could cut both ways. We could see aggressive and upset employers filing RICO actions against phony and/or questionable claimants seeking treble damages and attorney’s fees. If that happened, it would be very hard for the Claimant bar to step up and fight back—Federal RICO litigation is very, very expensive to defend.

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

Synopsis: When Enough Work Comp Benefits Are Paid, Uninsured Motorist Benefits May Not Be Due.

Editor’s comment: In Country Preferred Insurance Co. v. Groen, Claimant suffered an accident that occurred during the course of her employment and Claimant-defendant Groen received substantial benefits under the Illinois Workers’ Compensation Act in excess of $400,000. In addition, she sought uninsured motorist benefits from Plaintiff Country Preferred Insurance Company, under a policy, which contained a provision entitling Plaintiff insurance company to reduce the amount of its liability by any payments made or due under the IL WC Act.

Ultimately, the trial court granted summary judgment in favor of Plaintiff Country Preferred and against the injured worker. She appealed, arguing the court erred in granting summary judgment because Plaintiff insurer should be prohibited from reducing the amount of its available

uninsured motorist coverage by the amount of medical expenses paid by her employer in her work comp claim. Specifically, she argued

(1) medical payments made pursuant to the IL WC Act are not “for” an insured and, therefore, are not subject to setoff under her uninsured motorist policy;

(2) alternatively, the setoff provision was somehow ambiguous as to whether medical payments made by an employer under the IL WC Act are subject to setoff and, therefore, should be construed in her favor; and

(3) the setoff provision “is unenforceable because it violates the IL WC Act.”

On October 7, 2013, the worker was struck as a pedestrian by an uninsured motor vehicle and suffered serious injuries. At the time of the accident, Claimant Groen was working and was acting within the scope of her employment. As a result, Claimant sought and received workers’

compensation benefits under the Act. Specifically, she received temporary total disability benefits in the amount of $328.33 per week beginning on October 7, 2013, and up to at least July 28, 2014, the date Claimant signed an affidavit in the within action. In addition, as of July 22,

2014, defendant’s employer had paid $410,266.63 in medical bills pursuant to the Act.

In addition to receiving workers’ compensation benefits, Claimant Groen sought benefits from Country Preferred under an uninsured motorist policy with limits of $250,000 per person and $500,000 per occurrence.

In June 2014, the insurer filed a complaint for declaratory judgment, seeking a declaration of the parties’ rights and obligations under the uninsured motorist policy, which, in relevant part, provides as follows:

“Amounts payable for damages under Uninsured-Underinsured Motorists, Coverage U, will be reduced by the present value of all amounts paid or payable under any workers’ compensation, disability benefits or any similar law.”

The insurer asserted Claimant Groen was not entitled to benefits under her uninsured motorist policy because she had already collected more than $250,000 in workers’ compensation benefits. In March 2015, the insurer filed an amended motion for summary judgment, asserting Ms. Groen could not maintain a viable uninsured motorist claim, since she had already received workers’ compensation benefits in excess of the uninsured motorist policy’s limits. In August 2015, Counsel for Claimant Groen filed a cross-motion for summary judgment, asserting the setoff provision (1) violated the Act and was unenforceable and (2) excluded medical payments made by her employer directly to her medical providers.

Following a December 2015 hearing on the motions, the trial court granted the insurer’s amended motion for summary judgment and denied Ms. Groen’s motion for summary judgment. In its written order, the trial court found the setoff provision was enforceable, unambiguous, and not against public policy. This Appellate Court unanimously agreed.

We checked the IWCC website and note the underlying WC claim is now moving into its fourth year.

We appreciate your thoughts and comments. Please post them on our award-winning blog. If you want the cite to this ruling, send a reply.

Synopsis: Illinois WC Rates Jump Again and Your PPD Reserves Need To Be UPDATED RETROACTIVELY(!). Send a Reply to Get a Free Copy of Shawn R. Biery’s Updated IL WC Rate-Sheet!

Editor’s comment: There continues to be an upward spiral of IL WC rates. As mentioned twice every year, starting in the 1980’s, the IL WC Act provides a formula which effectively insures no matter how poor the IL economy is doing, our WC rates keep climbing.

We caution our readers to pay attention to the fact the IL WC statutory maximum PPD rate is now $775.18. When it was published, this rate changed retroactively from July 1, 2016 to present. If you reserved a claim based on the prior rate for the period from July 1 to right now, your reserves are wrong. If you have a claim with a date of loss after July 2016 and a max PPD rate, you need to take a look and see if the new maximum PPD rate applies. WORD OF CAUTION: There is pending legislation which Gene reported last week and this week which currently states “The maximum compensation rate for the period July 1, 2017 through June 30, 2021, except as hereinafter provided, shall be $755.22. Effective July 1, 2021 and on July 1 of each year thereafter the maximum weekly compensation rate, except as hereinafter provided, shall be determined as follows: if during the preceding 12-month period there shall have been an increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act, the weekly compensation rate shall be proportionately increased by the same percentage as the percentage of increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act during such period.” THIS NEW LEGISLATION WOULD POTENTIALLY CHANGE THIS PPD MAX AGAIN. If this isn’t clear, send a reply to Shawn at sbiery@keefe-law.com.

The current TTD weekly maximum has risen to $1,435.17. A worker has to make over $2,152.76 per week or $111,943.52 per year to hit the new IL WC maximum TTD rate. Does any state in the United States have a TTD maximum that high?

The new IL WC minimum death benefit is 25 years of compensation or $538.19 per week x 52 weeks in a year x 25 years or $699,647.00! The new maximum IL WC death benefit is $1,435.17 times 52 weeks times 25 years or a lofty $1,865,721.00 plus burial benefits of $8K. On top of this massive benefit, Illinois employers/governments have to pay COLA increases.

The best way to make sense of all of this is to get Shawn Biery’s colorful, updated and easy-to-understand IL WC Rate Sheet. If you want it, simply reply to Shawn at sbiery@keefe-law.com or email Marissa with your mailing address if you would like to be mailed a laminated copy at mpatel@keefe-law.com and they will get a copy routed to you before they raise the rates again!

Synopsis: Happy Valentine’s Day from the Gang at KCB&A!!

Editor’s comment: Okay, so it is a little early but, like the Boy Scouts—Be prepared!

1-23-2017; Shawn Biery on New IL WC Rates With Free Rate Sheet!!!; Update on IL WC eform With IL State Chamber's Position; Can We Consider Another March?; and more

Synopsis: Illinois WC Rates Jump Again and Your PPD Reserves Need To Be UPDATED RETROACTIVELY(!). Send a Reply to Get a Free Copy of Shawn R. Biery’s Updated IL WC Rate-Sheet!

Editor’s comment: There continues to be an upward spiral of IL WC rates. As mentioned twice every year, starting in the 1980’s, the IL WC Act provides a formula which effectively insures no matter how poor the IL economy is doing, our WC rates keep climbing.

We caution our readers to pay attention to the fact the IL WC statutory maximum PPD rate is now $775.18. When it was published, this rate changed retroactively from July 1, 2016 to present. If you reserved a claim based on the prior rate for the period from July 1 to right now, your reserves are wrong. If you have a claim with a date of loss after July 2016 and a max PPD rate, you need to take a look and see if the new maximum PPD rate applies. WORD OF CAUTION: There is pending legislation which Gene reported last week and this week which currently states “The maximum compensation rate for the period July 1, 2017 through June 30, 2021, except as hereinafter provided, shall be $755.22. Effective July 1, 2021 and on July 1 of each year thereafter the maximum weekly compensation rate, except as hereinafter provided, shall be determined as follows: if during the preceding 12-month period there shall have been an increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act, the weekly compensation rate shall be proportionately increased by the same percentage as the percentage of increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act during such period.” THIS NEW LEGISLATION WOULD POTENTIALLY CHANGE THIS PPD MAX AGAIN. If this isn’t clear, send a reply to Shawn at sbiery@keefe-law.com.

The current TTD weekly maximum has risen to $1,435.17. A worker has to make over $2,152.76 per week or $111,943.52 per year to hit the new IL WC maximum TTD rate. Does any state in the United States have a TTD maximum that high?

The new IL WC minimum death benefit is 25 years of compensation or $538.19 per week x 52 weeks in a year x 25 years or $699,647.00! The new maximum IL WC death benefit is $1,435.17 times 52 weeks times 25 years or a lofty $1,865,721.00 plus burial benefits of $8K. On top of this massive benefit, Illinois employers/governments have to pay COLA increases.

The best way to make sense of all of this is to get Shawn Biery’s colorful, updated and easy-to-understand IL WC Rate Sheet. If you want it, simply reply to Shawn at sbiery@keefe-law.com or email Marissa with your mailing address if you would like to be mailed a laminated copy at mpatel@keefe-law.com and they will get a copy routed to you before they raise the rates again!

Synopsis: IL WC Reform Update—Thoughts from Your Editor and the Position of the IL State Chamber WC Legislative Experts.

Editor’s comment: The battle in Springfield continues to rage. Here are our thoughts along with the analysis/comments of the WC gurus at the IL State Chamber. We like to tell all of our readers State Chamber President Todd Maisch and his expert lobbyist Jay Dee Shattuck are the go-to folks to monitor and protect the interests of IL business and local government whenever WC reform is afoot. If you are interested in joining their efforts, go to www.ilchamber.org for more information and details.

Key Issues for IL Employers--both your editor and the IL State Chamber agree most current IL WC reform provisions need additional work and careful consideration.

Traveling employee—the provision codifies current case law regarding “traveling employee” beyond the ruling of the IL Supreme Court in Venture Newburg by establishing a “reasonable & foreseeable” standard for determining compensability. The legislation adds a compensable accidental injury does not include travel that is a “purely personal deviation or personal errand, unless such deviation or errand is substantial.” It also references factors for determining traveling employee status from Venture Newburg.

·         From my perspective, this concept doesn’t need legislation at all. The words “traveling employee” don’t appear in the IL WC Act and doesn’t need to be added. I think the proposed “reform” actually expands coverage in ways that may be very adverse to IL employers. The legislation already in place about “arising out of and in the course of” employment is covered by common sense. If Governor Rauner’s arbitrators/commissioners don’t use common sense in defining “traveling employees,” he should quickly fire them.

·         The IL State Chamber is on record to OPPOSE because they feel it is codification of current case law locks in the expansion of liability for employers imposed by the IL courts over the past decade. They have alternative compromise that recognizes circumstances where an employee traveling to perform their job duties and injured is compensable.

 Neutral risk--adds that “accidental injuries resulting from a neutral risk arise out of and in the course of the employment if the employment quantitatively or qualitatively contributes in any way to the neutral risk.”

·         As I advised last week, I have no idea what this provision might mean or how our activist and very liberal reviewing courts would handle it. Quantifiable/Schmantifiable!--I have no idea what might be behind “Door Number One” if we open this legislative can of worms, so why even go there?

·         The IL State Chamber is on record to OPPOSE because codification of current case law locks in the undermining by the courts of the “neutral risk” doctrine which has been case law for nearly 100 years. Neutral risk requires the employment to provide a risk greater than what the general public is exposed to. The State Chamber has alternative language for the IL Senate to consider.

Intervening cause--creates a new “intervening cause” standard that codifies current case law regarding causation. It provides “an intervening cause breaks the chain of causation, any subsequent consequence flowing from the intervening cause is not compensable under this Act. An intervening cause is a cause that completely breaks the chain of causation.” It also provides that: “if an employee, who sustained an accidental injury compensable under this Act which results in a responsibility to pay compensation on the part of the employer, subsequently sustains another injury due to his or her own intentional conduct or negligence that accelerates, aggravates, or worsens the effects or disability of the first injury in any manner, regardless of whether or not he or she has fully recovered from the effects of the first injury, the employer's responsibility to pay compensation to the employee or his or her dependents shall not be increased due to the effects or disability resulting from the subsequent injury.” 

·         Again, we have no idea what and how the reviewing courts and Commission will handle what appears to be well-intentioned legislation.

·         The IL State Chamber is on record to OPPOSE, indicating codification of current case law locks in the expansion of liability for employers imposed by the IL courts over the past decade. They have alternative compromise legislation that strengthens requirement of the injury or illness arise out of and in the course of employment.

IL WC Medical Fee Schedule Reductions—the sponsor indicates there are new provisions that will be presented for consideration. The intent is to revise those services identified by WCRI as exceptionally higher than other state fee schedules and targeted as presented in previous versions provided by Governor Rauner.

·         I support “hard” or unchangeable fee schedule reductions in appropriately selected medical services. We aren’t truly knowledgeable about the details but hope the sponsors hit the target they are shooting at.

·         The IL State Chamber is on record to SUPPORT these provisions when finalized and following their review of the new language.

IL WC Drug Formulary--the Commission, in consultation with the Workers' Compensation Medical Fee Advisory Board, shall promulgate by rule an evidence-based drug formulary and any rules necessary for its administration. Prescriptions prescribed for workers' compensation cases shall be limited to those prescription drugs and doses on the closed formulary

·         I strongly support any common sense limitations on drug prescriptions in IL WC claims.

·         The IL State Chamber is on record to SUPPORT this legislation.

Statewide Average Weekly Wage Freeze—this provision freezes the SAWW for four years beginning July 1, 2017 the maximum weekly wage rate at $755.22

·         I feel this would provide savings to IL employers and local governments. It wouldn’t be a dramatic savings but any savings is better than none.

·         The IL State Chamber is on record to SUPPORT the provision for the WC savings it proposes for their members and others.

AMA Guidelines for Determining Permanency--:this legislation allows AMA guideline submission for impairment rating for PPD benefit and requires the IL WC Commission to consider an AMA impairment rating, if one is presented.

·         I consider the debate over impairment rating evidence to be something of a red herring in the IL WC reform process. If the Arbitrators and Commissioners are told to consider ratings they will do so or face early retirement.

·         The IL State Chamber is on record to OPPOSE, as they believe additional strengthening is needed due to the Continental Tire decision. They feel the law should require the Commission when considering an impairment rating make the determination by a preponderance of credible evidence  

Credits for Body as a Whole Awards—this legislation provides credits of prior injuries under 8 (d) (2) for “body as a whole” injuries. Provides for a definition of “same part of a spine.”

·         I consider this a common sense change that implicitly “reverses” the liberal and activist decisions by our IL reviewing courts that would allow someone to be adjudicated 200% or 300% (or more)  disabled!

·         The IL State Chamber is on record to SUPPORT, but they feel the legislation proposed needs correcting language.

Shoulder to be a part of the arm and Hip to be part of the leg—this provision reversed the Will County Forest Preserve v. IWCC Appellate Court ruling regarding the shoulder not being part of the arm & establishes one’s hip is part of the leg returning IL WC to anatomical correctness.

·         With respect to our judiciary, I personally feel it is a shame we have to pass legislation and waste time returning IL WC to common sense principles.

·         The IL State Chamber is on record to SUPPORT as this provision returns 100 years of legal precedence ruling the shoulder is part of the arm which courts took away under the Will County Forest Preserve decision in 2012.

Waiting period at start of TTD—this provision revises current 3 days to 5 working days the period for temporary total disability begins and revises from the 4th day to 6th day for the beginning of weekly compensation payments for TTD begins

·         As I advised this will provide some savings but not much.

·         The IL State Chamber is on record to SUPPORT the new law but confirms it is a minor impact on WC savings for employers.

Wage differential changes for professional athletes--this legislation provides a wage differential cap for professional athletes…

·         I don’t have a problem but the effect/scope is very limited.

·         The IL State Chamber is on record to SUPPORT but they confirm there is no savings impact for employers not employing professional athletes.

Physical Therapy, Occtherapy and Chiro visit limits—the legislation limits chiropractic, occupational therapy, or physical therapy visits to up to 24 visits per claim.

·         This reform would cure a common complaint of all of our defense clients across the state. I think the IL State Chamber’s concerns below are spot-on and make more sense than my view because the “limit” might cause every claimant to want to blow the insurance carrier or self-insured employers money to get all 24 visits provided. I am also sure all Claimant attorneys would start coaching/telling doctors and injured workers to prescribe and get all 24 visits.

·         The IL State Chamber is on record to OPPOSE the new provision as it would entitle an injured employee up to 24 visits per claim. They support requiring such providers to provide services that are medically necessary, reasonable, are based on medical evidence and meet nationally recognized peer review standards of care and guidelines.

IL WC System Changes

Arbitrator rotation: IWCC Chairman determines arbitrator assignments rather than 2-year rotation.

·         I don’t feel this needs legislation and the Chairman should simply follow existing law.

·         The IL State Chamber is on record to confirm the proposal needs revision. They have language to preserve original purpose of protecting injured workers and employers from arbitrators who are unfair in their decisions or become too “comfortable” with claimant attorneys in their call area.

Arbitration status calls go electronic/online—this provision allows parties or their attorneys may appear by telephone, video conference, or other remote electronic means as prescribed by the IL WC Commission

·         I am concerned this is going to turn into non-lawyers practicing law but we will have to see. I don’t feel we can stop the intrusion of electronics/online services into our lives.

·         The IL State Chamber is on record to SUPPORT the provision because it should save some costs for their members and potential members.

IL WC Appeal Bond requirement—this provision removes WC appeal bond requirement for State of Illinois and its agencies.

·         I don’t see this as much of an impact for your business or mine.

·         The gurus at the IL State Chamber feel all IL employers with viable WC insurance or self-insured state should be able to waive/save the additional cost of an unneeded and expensive IL WC appeal bond.

IL WC Fraud--this provision adds to the Criminal Code criminal penalties for acts of fraud that are listed in the Workers’ Compensation Act. The intent is to eliminate the response from certain states attorneys that will not prosecute workers’ compensation as they view them simply as a civil matter. The provision also revises penalties for fraud in the WC Act.

·         I support it but don’t feel it is much of a change.

·         The IL State Chamber is on record to SUPPORT the change.

More penalties on IL employers—this provision adds new penalties on employers but does not improve medical care for injured workers, provide more timely benefits to injured workers or reduce friction in the system.

·         I don’t see any reason for these proposed reforms and don’t feel they will improve anything.

·         The IL State Chamber is on record to SUPPORT changes which improves the system for both legitimately injured workers and employers.

Electronic medical billing requirement in IL WC—there are two new electronic billing penalties: IWCC penalty of 1% per month interest if a complete electronic bill is not paid or objected to within 30 days and a DOI penalty of $1,000 up to $10,000 for simple failure to comply with the electronic claims acceptance and response process.

·         As we indicated above, IL WC is inexorably moving to electronic medical bill submission and processing.

·         The IL State Chamber is on record to OPPOSE, as they have alternative compromise that you can and should ask them about.

 Requirement for Rapid Medical Authorization of Proposed/Recommended WC Care—this provision addresses the Hollywood Casino v. IWCC decision establishing 19K penalties for unreasonable or vexatious delay of authorization of medical care.

·         We hate this concept and feel the Arbitrators and Commissioners should use common sense in handling slow or non-authorization of important medical care.

·         The IL State Chamber is on record to OPPOSE, as they have alternative compromise language that utilizes Section 19 lprovisions which was part of SB 2901 approved by the House Democrats on January 9, 2017.

Finally

WEAR Commission: Creates WC Edit, Alignment, and Reform Commission composed of legislators, petitioner attorneys and respondent attorneys for the purpose of recodify the Act without changing substantive law or established case law. Commission report by 1/1/18

·         I consider this another do-nothing blue-ribbon panel—the tasks described could be taken up by the nine-member IL WC Commission or the IL WC Commission Advisory Board or the IL WC Medical Fee Schedule Advisory Board or….

·         The IL State Chamber is on record to confirm they are NEUTRAL, as the provision, as it provides no help to employers

Self-insurer reporting—this provision requires more reporting to IWCC and DOI for self-insurers. Protection of individual employer proprietary information and requires reporting of aggregate data.

·         I don’t see the reason for even more reporting and regulation.

·         The IL State Chamber is on record as NEUTRAL as the legislation adds additional government burdens on self-insured employers without any clear benefit for employers.

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

Synopsis: The Next Million-Person March for U.S. and Illinois—Will There Ever Be Gov’t Budget Cuts to Match Tax Income?

Editor’s comment: I admit this isn’t precisely a work comp issue but in the aftermath of the inauguration of our new omni-stressed President and the anniversary of the second year of the first term for Governor Bruce Rauner, I wanted to send my readers a simple message to take to your federal and state elected officials. I wish we could get a million people to again march on Washington and Springfield for this crucial issue.

You will note both the U.S. and State of Illinois governments are now being run by rogue but highly effective businessmen who have used millions of their personal money to attain office. Neither of them have any political history or background to speak of. They are both came into political office owing nothing to anyone’s brother’s-cousin’s-uncle. It is my hope they will start to use that status to fight for our country’s biggest political issue that “trumps” all other issues—getting our country and this nutty state out of red ink.

The other interesting thing both the new President and our entering-his-third-year Governor have in common is they are both running governments with substantial and spiraling debt. For both federal and IL state governments, incoming taxes don’t even slightly match ever-rising government spending at all. I can only grin to remember how popular former President Barack Obama was while in office despite the fact every year in office the government he ran borrowed and spent over a trillion dollars they didn’t have. In my view, it is easy to be popular when you are running a credit card government on money that won’t be paid back by our great-grandchildren for decades to come.

I have enormous respect for my cousins, friends and readers who traveled to and participated in the Women’s March on Washington over this past weekend. It is my hope our new President and all government officials across the country carefully consider the ardent message presented. It is also my hope another message be sent to the same federal and state officials—please, please, please start cutting government budgets across the board! I am sure the federal government has unnecessary and duplicative jobs that could be rapidly eliminated to save billions. I wish our crabby new President would ask some of the best management consulting firms in the United States to volunteer their time and computers to let him know where to start chopping heads and cut the growing massive budget deficit.

In Illinois, we are being asked to agree to rising taxes and a new sugar-soda drink tax and billions in new borrowing. In my view, Governor Rauner has a mildly skewed view of the importance of workers’ comp reform and is supporting some of the compromise IL WC reforms you can review below. What I haven’t seen or heard Governor Rauner, Senator Christine Radogno and other Republican leaders demand is Across-the-Board Budget Cuts or what I call ABBC for IL state government. In my view, if you are going to hike my taxes and your taxes and add more debt, you have to attack/manage the patent and clear reason for those higher taxes and new debt which is inefficient and duplicative state government. For just a couple of easy IL gov’t cost cutters, how about:

·         Getting rid of the do-nothing job of Lieutenant Governor?

·         Consolidating the obviously duplicative offices of the IL State Treasurer and the IL State Comptroller that do exactly the same thing?

·         Getting rid of the silly Secretary of State Police Dep’t that doesn’t “police” anything and could be performed by the IL State Police?

·         Getting rid of the nutty “remote offices” for many state agencies that create do-nothing jobs that aren’t needed?

·         Consolidating 88 IL State agencies into 60 or 40 state agencies to rid ourselves of the multiple fiefdoms created by having so many disparate agencies?

·         Bring back totally and permanently disabled state workers getting lifetime welfare-like work comp benefits, to require they be trained and given top priority to return to sedentary and light jobs when such positions open up? Do we have to pay for injured cops, firefighters or prison guards with an operated shoulder/spine for the rest of their lives when they are allowed to get jobs in private industry and make thousands on top of their fake “disability” pensions?

There are literally hundreds of other ways our federal and state governments could cut budgets and provide more value to taxpayers. It isn’t going to happen until we start telling our leaders to do it. Let’s march!!!

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Synopsis: Happy Valentine’s Day from the Gang at KCB&A!!

Editor’s comment: Okay, so it is a little early but, like the Boy Scouts—Be prepared!

1-16-2017 Massive IL WC Amendments Proposed and Might Be Coming to a Claim Near You!!; Pankhuri Parti on Important IN WC Subro-Insurance Ruling and more

Synopsis: Massive IL WC Amendments Proposed and May Be Coming!!

Editor’s comment: We thank J. Todd Foster of WorkCompCentral for giving us the heads up on this new proposed legislation. It is part of a bigger package of thirteen—yes, lucky 13—bills proposed by the IL Senate that have to all be agreed upon by everyone or they all fall to the wayside. If you want the link to the new bills, send a reply. We will continue to update progress on passage/enactment—watch this space for more news blasts. Please note IL income taxes are poised to go up to 4.95% as part of the combined legislative proposal. There is also going to be a new IL state tax on sugary sweetened colas/drinks like Coke and Pepsi.

Please note we created this legislative summary very rapidly and we didn’t have time to triple-check everything. All of our reporting and opinions are subject to modification at a later time, as more information is released.

Please further note I agree with this comment I saw in the Capitol Fax Blog: “The elephant in the room on workers compensation is that the number of filings statewide has continued to decrease annually. In 2016 I don’t think 40,000 statewide was cracked. Reforming workers compensation is speck in the universe of Illinois’ problems. I never understood the vehemence of the [WC] reform movement.” In my view, the many changes to IL state law don’t truly address the giant metrics of unfundable state government pensions, spiraling debt, unresponsive leadership and rising and new taxes. We haven’t heard Governor Rauner, Speaker Madigan or Senate President Cullerton talk about or fight for budget cuts or ending redundant and outdated state jobs. There are still going to be lots of worthless do-nothing remote offices staffed by nice folks that get coffee for the lawyers and keep track of the copying machines. We still have an IL Comptroller’s Office that is a duplicate of the IL Treasurer’s Office. There are still thousands of state workers on taxpayer-paid workers’ comp and other state disability programs instead of bringing them back to sedentary and light jobs.

Either way, we have to report these important facts and here they are with our comments in bold:

Sec. 17-10.4. Workers' compensation fraud.

(a) It is unlawful for any person, company, corporation, insurance carrier, health care provider, or other entity to:

(1) Intentionally present or cause to be presented any false or fraudulent claim for the payment of any workers' compensation benefit.

(2) Intentionally make or cause to be made any false or fraudulent material statement or material representation for the purpose of obtaining or denying any workers' compensation benefit.

(3) Intentionally make or cause to be made any false or fraudulent statements with regard to entitlement to workers' compensation benefits with the intent to prevent an injured worker from making a legitimate claim for any workers' compensation benefit.

(4) Intentionally prepare or provide an invalid, false, or counterfeit certificate of insurance as proof of workers' compensation insurance.

(5) Intentionally make or cause to be made any false or fraudulent material statement or material representation for the purpose of obtaining workers' compensation insurance at less than the proper amount for that

insurance.

(6) Intentionally make or cause to be made any false or fraudulent material statement or material representation on an initial or renewal self-insurance application or accompanying financial statement for the purpose of

obtaining self-insurance status or reducing the amount of security that may be required to be furnished pursuant to Section 4 of the Workers' Compensation Act.

(7) Intentionally make or cause to be made any false or fraudulent material statement to the Department of Insurance's fraud and insurance non-compliance unit in the course of an investigation of fraud or insurance

non-compliance.

(8) Intentionally present a bill or statement for the payment for medical services that were not provided.

(9) Intentionally assist, abet, solicit, or conspire with any person, company, or other entity to commit any of the acts in paragraph (1), (2), (3), (4), (5), (6), (7), or

(8) of this subsection (a).

Enhanced criminal sentences are outlined but omitted here.

Comment: This isn’t a major change. Section 3 that I highlighted might be a basis for the aggressive IL Plaintiff bar to threaten imprisonment of defense lawyers, claims handlers, risk managers and others if the attorney could prove there was something “false” in claim handling or as reported to the attorney. It might, just might also open up criminal liability for nurse case managers who are hated by the Plaintiff bar when if they communicate on an ex parte basis with a treater—I don’t think the legislation says that but I bet Claimant lawyers might try to get a liberal hearing officer or reviewing court to consider the idea.

(e) Traveling employees.

(1) Except as otherwise provided under this Section, accidental injuries sustained while traveling to or from work do not arise out of and in the course of employment.

(2) Accidental injuries are considered to be "arising out of and in the course of the employment" where an employee is required to travel away from his or her employer's premises in order to perform his or her job and when the conduct in which he or she was engaged at the time of the injury is reasonable and when that conduct might have been anticipated or foreseen by the employer.

(3) Accidental injuries while traveling do not occur in the course of employment if the accident occurs during a purely personal deviation or personal errand, unless such deviation or errand is insubstantial.

(4) In determining whether an employee is required to travel away from his or her employer's premises in order to perform his or her job, along with all other relevant factors, the following factors may be considered: whether the employer had knowledge that the employee may be required to travel to perform the job; whether the employer furnished any mode of transportation to or from the employee; whether the employee received or the employer paid or agreed to pay any remuneration or reimbursement for costs or expenses of any form of travel; whether the

employer in any way directed the course or method of travel; whether the employer in any way assisted the employee in making any travel arrangements; whether the employer furnished lodging or in any way reimbursed the employee for lodging; or whether the employer received any benefit from the employee traveling.

I continue to hate, literally despise the language above and consider it to be an expansion of IL WC coverage. I believe our IL Reformin’ Republicans think this is reining in the “traveling employee” concept. In my view, this poorly created language would expand workers’ comp coverage for an admin going to get gum or aspirin at a local drugstore. It also includes language making a trucker staying at a hotel of his/her choice to be covered if the employer “assisted” them in making travel arrangements or the dumbest language of all—whether the employer received “any benefit” from the travel!!! I strongly feel Governor Rauner and his people are being completely hoodwinked. I wish they would allow/order the Arbitrators and Commissioners to rein in the concept by using what other states call “common sense.”

(f) Neutral risks. Accidental injuries resulting from neutral risk arise out of and in the course of the employment if the employment quantitatively or qualitatively contributes in any way to the neutral risk.

I have no idea what this impossible-to-understand legislative language might mean and assume it is also going to be twisted and spun against IL business and local government by our “activist” reviewing courts who created it. There is no reason for Governor Rauner or his team to support this tom-foolery. Try to imagine 50 silly rulings on qualitative v. quantitative v. quantifiable before you start to gag to read what this legislative silliness might be turned into. I consider it nonsense and hope it is deleted. For my readers among the Plaintiff bar, please hold off on any urge to reply and define your view of what neutral v. non-neutral risk might be—I already have a headache.

(g) Intervening cause.

(1) Except as otherwise provided under this Section, every natural consequence that flows from an injury that arose out of and in the course of employment is compensable under this Act. A work-related injury need not be the sole causative factor or the primary causative factor as long as it was a causative factor in the resulting condition such that the condition would not have occurred but for the work-related injury.

(2) Where an intervening cause breaks the chain of causation, any subsequent consequence flowing from the intervening cause is not compensable under this Act. An intervening cause is a cause that completely breaks the

chain of causation.

(3) Notwithstanding any provision of this Act to the contrary, if an employee, who sustained an accidental injury compensable under this Act which results in a responsibility to pay compensation on the part of the employer, subsequently sustains another injury due to his or her own intentional conduct or negligence that accelerates, aggravates, or worsens the effects or disability of the first injury in any manner, regardless of whether or not he or she has fully recovered from the effects of the first injury, the employer's responsibility to pay compensation to the employee or his or her dependents shall not be increased due to the effects or disability resulting from the subsequent injury.

This is a legislative effort to “reverse” the ruling in Vogel v. IIC and its progeny. No one will be able to tell if it will “work” until the reviewing courts throw it in their blender. This legislation will save money for IL Business and local governments if the reviewing courts give this language its English-language meaning. I don’t feel that happens very often in our reviewing courts but we will have to wait and see.

(b) If the period of temporary total incapacity for work lasts more than 5 working days, weekly compensation as hereinafter provided shall be paid beginning on the 6th day of such temporary total incapacity and continuing as long as the total temporary incapacity lasts. In cases where the temporary total incapacity for work continues for a period of 14 days or more from the day of the accident compensation shall commence on the day after the accident.

This changes the IL WC waiting period to start TTD from 3 to 5 days. In my view, this change is minimal and unneeded, as it may save IL business and local government about a dollar.

The maximum compensation rate for the period July 1, 2017 through June 30, 2021, except as hereinafter provided, shall be $755.22. Effective July 1, 2021 and on July 1 of each year thereafter the maximum weekly compensation rate, except as hereinafter provided, shall be determined as follows: if during the preceding 12-month period there shall have been an increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act, the weekly compensation rate shall be proportionately increased by the same percentage as the percentage of increase in the State's average weekly wage in covered industries under the Unemployment Insurance Act during such period.

I believe this provision locks in what I believe is last year’s max permanency rate for more than 4 years or until June 2021. It should be a modest savings for trucking and construction companies and other employers who have high wage earners.

For accidental injuries involving professional athletes that occur on or after the effective date of this amendatory Act of the 100th General Assembly, an award for wage differential under this subsection shall be effective for the expected remaining duration of the employee's professional sports athletic career. As used in this paragraph (d)1, "professional athlete" means an individual whose employer is a professional athletic team that is based in Illinois, including, but not limited to, any professional baseball, basketball, football, soccer, or hockey team based in Illinois and who derives the majority of his or her income from playing athletics for the professional athletic team. The expected remaining duration of an employee's professional sports athletic career shall continue until the employee reaches the age of 35 or for a period of 5 years from the date of the injury, whichever is later, unless the employer or employee isable to successfully prove, by a preponderance of the evidence, that the expected remaining duration of such employee's professional sports athletic career has a shorter or longer duration.

This will change will be a savings to the Cubs, Sox, Bear, Blackhawks and Fire. I didn’t know they were even aware of the unfairness caused by the IL WC Act and am happy to see someone is doing this.

For purposes of awards under this subdivision (e), injuries to the shoulder shall be considered injuries to part of the arm. The foregoing change made by this amendatory Act of the 100th General Assembly to this subdivision (e)10 of this Section 8 is declarative of existing law and is not a new enactment. For purposes of awards under this subdivision (e), injuries to the hip shall be considered injuries to part of the leg. The foregoing change made by this amendatory Act of the 100th General Assembly to this subdivision (e)12 of this Section 8 is declarative of existing law and is not a new enactment.

These two provisions change/”reverse” the unusual ruling in the Will County Forest Preserve District v. IWCC case where the IL Appellate Court, WC Division reversed over 100 years of IL WC law and practice to judicially remove the shoulder from the “arm” and the hip from the “leg.” I consider it a positive step and something IL business and local governments should be very happy with.

Any employee who has previously suffered the loss or permanent and complete loss of the use of any of such members or loss under Section 8(d)2 due to accidental injuries to the same part of the spine, and in a subsequent independent accident loses another or suffers the permanent and complete loss of the use of any one of such members or loss under Section 8(d)2 due to accidental injuries to the same part of the spine the employer for whom the injured employee is working at the time of the last independent accident is liable to pay compensation only for the loss or permanent and complete loss of the use of the member or loss under Section 8(d)2 due to accidental injuries to the same part of the spine occasioned by the last independent accident. For purposes of this subdivision (e)18 only, "same part of the spine" means: (1)cervical spine and thoracic spine from vertebra C1 throughT12; and (2) lumbar and sacral spine and coccyx from vertebra L1 through S5.

This provision is mildly confusing to me but it makes enormous sense and appears to be an effort to provide “credit” for prior body as a whole settlements/awards. Again, IL business and local governments will love the change, in my view.

(b) In determining the level of permanent partial disability, the Commission shall base its determination on the following factors: (i) the reported level of impairment pursuant to subsection (a), if such a report exists; (ii) the occupation of the injured employee; (iii) the age of the employee at the time of the injury; (iv) the employee's future earning capacity; and (v) evidence of disability corroborated by the treating medical records or examination under Section 12 of this Act. No single enumerated factor shall be the sole determinant of disability. Where an impairment report exists, it must be considered by the Commission in its determination. In determining the level of disability, the relevance and weight of any factors used in addition to the level of impairment as reported by the physician must be explained in a

written order.

(c) A report of impairment prepared pursuant to subsection (a) is not required for an arbitrator or the Commission to make an award for permanent partial disability or permanent total disability benefits or any award for benefits under subsection (b) In determining the level of permanent partial disability, the Commission shall base its determination on the following factors: (i) the reported level of impairment pursuant to subsection (a), if such a report exists; (ii) the occupation of the injured employee; (iii) the age of the employee at the time of the injury; (iv) the employee's future earning capacity; and (v) evidence of disability corroborated by the treating medical records or examination under Section 12 of this Act. No single enumerated factor shall be the sole determinant of disability. Where an impairment report exists,

it must be considered by the Commission in its determination. In determining the level of disability, the relevance and weight of any factors used in addition to the level of impairment as reported by the physician must be explained in a written order. (c) A report of impairment prepared pursuant to subsection (a) is not required for an arbitrator or the Commission to make an award for permanent partial disability or permanent total disability benefits or any award for benefits under subsection (c) of Section 8 or subsection (d) of Section 8 of this Act or to approve a Settlement Contract Lump Sum Petition.

Blah, blah, blah. This whole section was sought be IL Gov. Rauner for his “turnaround” agenda. It would be unnecessary if the Arbitrators he selected and the Arbs he let keep their jobs simply were told to implement lower permanency values with whatever metrics they want.

(a-2.5) For procedures, treatments, services, or supplies covered under this Act and rendered or to be rendered on or after June 1, 2017, the maximum allowable payment for the following service categories set forth in Title 50, Section 7110.90 of the Illinois Administrative Code shall be 85% of the fee schedule amounts in effect on May 31, 2017, which shall be adjusted yearly by the Consumer Price Index-U, as described in subsection (a) of this Section:

(1) Section 1: Ambulatory Surgical Treatment Center (ASTC) and Accredited Ambulatory Surgical Treatment Facility (ASTF).

(2) Section 7(C): Hospital Outpatient -- Radiology.

(3) Section 7(D): Hospital Outpatient – Pathology and Laboratory.

(4) Section 8(F): Professional Services – Pathology and Laboratory.

(5) Section 8(G): Professional Services – Radiology.

(a-2.6) For procedures, treatments, services, or supplies covered under this Act and rendered or to be rendered on or after June 1, 2017, the maximum allowable payment for the following service categories set forth in Title 50, Section 7110.90 of the Illinois Administrative Code shall be 90% of the fee schedule amounts in effect on May 31, 2017, which shall be adjusted yearly by the Consumer Price Index-U, as described in subsection (a) of this Section:

(1) Section 7(F): Hospital Outpatient Surgical Facility.

(2) Section 8(D): Professional Services – Surgery.

I am told this brings IL WC more in line with other states and counters the growth of aggressive billing Ambulatory Surgical Centers. I am sure all defense folks will like the savings. I also feel the docs and healthcare givers won’t like it.

(a-3) Prescriptions filled and dispensed outside of a licensed pharmacy shall be subject to a fee schedule that shall not exceed the Average Wholesale Price (AWP) plus a dispensing fee of $4.18. AWP or its equivalent as registered by the National Drug Code shall be set forth for that drug on that date as published in Medispan.

(a-4) The Commission, in consultation with the Workers' Compensation Medical Fee Advisory Board, shall promulgate by rule an evidence-based drug formulary and any rules necessary for its administration. Prescriptions prescribed for workers' compensation cases shall be limited to those prescription drugs and doses on the closed formulary. A request for a prescription that is not on the closed formulary shall be reviewed pursuant to Section 8.7 of this Act.

I am sure this is designed to stop the growth and use of endless opioids in IL WC claims. I consider it a great and money-saving concept if/when they put it in place.

(4) Ensure that health care providers have at least 15 business days to comply with records requested by employers and insurers for the authorization of the payment of workers' compensation claims.

(5) Ensure that health care providers are responsible for supplying only those medical records pertaining to the provider's own claims that are minimally necessary.

(6) Provide that any electronically submitted bill determined to be complete but not paid or objected to within 30 days shall be subject to penalties pursuant to Section 8.2(d)(3) of this Act to be entered by the Commission.

(7) Provide that the Department of Insurance may impose an administrative fine if it determines that an employer or insurer has failed to comply with the electronic claims acceptance and response process. The amount of the administrative fine shall be no greater than $1,000 per each violation, but shall not exceed $10,000 for identical violations during a calendar year.

(c) The rules requiring employers and insurers to accept electronic claims for payment of medical services shall be proposed on or before March 1, 2017 and shall require all employers and insurers to accept electronic claims for payment of medical services on or before September 1, 2017.

Clear, simple and blunt. Not sure if it is going to work this time. If you look at the legislative language, it was enacted in 2012 following the 2011 Amendments to the IL WC Act and everyone ignored it.

(k) For injuries occurring on or after January 1, 2018, an employee shall be entitled to up to 24 chiropractic, occupational therapy, or physical therapy visits per claim. If an employee exceeds 24 chiropractic, occupational therapy, or physical therapy visits per claim, an employer or insurer may petition to the Commission to decide whether additional treatment is warranted. An employer or insurer that files a bona fide petition in good faith under this Section shall not be subject to penalties under the Act. This Section does not apply to visits for post-surgical rehabilitation services.

Oddly written legislation but great, truly great idea. The defense industry will be thrilled to see caps on such care that most defense folks feel is abused.

The Chairman of the Workers' Compensation Commission shall have discretion to assign and reassign arbitrators to each hearing site as needed.

No arbitrator shall hear cases in any county, other than Cook County, for more than 2 years in each 3-year term.

Yawn. Do they really have to legislate this?

Sec. 14.3. Workers' Compensation Edit, Alignment, and Reform Commission.

(a) There is created the Workers' Compensation Edit, Alignment, and Reform Commission, which shall be known as the WEAR Commission. The purpose of the WEAR Commission is to develop a proposed recodification of the Workers' Compensation Act that meets the following goals:

(1) to make this Act more accessible to laypeople seeking benefits under this Act and employers seeking insurance coverage for their responsibilities under this Act;

(2) to aid the Commission, attorneys, and judges in understanding and applying the provisions of this Act;

(3) to prevent disputes over interpretations of this Act that can add additional costs to the function and administration of the workers' compensation system;

(4) to reduce the size of each Section of this Act to promote understanding, interpretation, and indexing of this Act;

(5) to assist policymakers so that they can more easily understand the implication of amendments to this Act that may be proposed in the future;

(6) to replace outdated and obsolete language within this Act;

(7) to limit the opportunity for lengthy and expensive appeals due to confusion or contrary language within this Act; and

(8) to meet the preceding objectives without changing substantive law or disturbing established case law precedent.

Nothing in this Section 14.3 shall be construed to allow or authorize the WEAR Commission to seek to or to diminish, restrict, limit, expand, abrogate, alter, or change in any way the current interpretation of any substantive or procedural provision of this Act by the Commission or any Court. [The makeup of the “under-WEAR” Commission is outlined in boring detail]. (e) This Section is repealed on January 1, 2018.

Triple yawn. The IWCC has about six blue-ribbon advisory boards that occasionally meet and do even less. Any one of the advisory panels could be deputized to do this simple task without having to empanel another bunch of secretive and do-nothing blue ribbon panelists. It is great to see they only will be WEAR-ing this one for a year.

3. When an Arbitrator conducts a status call of cases that appear on the Arbitrator's docket in accordance with the rules of the Commission, parties or their attorneys may appear by telephone, video conference, or other remote electronic means as prescribed by the Commission.

Whoa—this is a stunning change to IWCC status calls and IWCC court clerking services may be out of business!!!! Can the Arbitrators remote in and save mileage expense?

The State of Illinois, including its constitutional officers, boards, commissions, agencies, public institutions of higher learning, and funds administered by the treasurer ex officio, and every county, city, town, township, incorporated village, school district, body politic or municipal corporation against whom the Commission shall have rendered an award for the payment of money shall not be required to file a bond to secure the payment of the award and the costs of the proceedings in the court to authorize the court to issue such summons.

This reverses a nutty ruling where a government agency was required to pay a denied claim when the reviewing court said a state agency needed a bond to file an appeal.

(a-5) The Commission shall annually submit to the Governor and the General Assembly a written report that details the state of self-insurance for workers' compensation in Illinois. The report shall be based on information currently collected by the Commission or the Department of Insurance from self-insurers, as of the effective date of this amendatory Act of the 100th General Assembly. The report shall be completed by April 1 of each year, beginning in 2017. The report shall be posted on the Commission's Internet website. Information to be included in the report shall be for the preceding calendar year.

This is an effort to allow our stat-rats to come up with metrics to compete with Oregon’s every-other-year WC premium rating report. I consider a colossal waste of taxpayer money.

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Synopsis: A Federal Appellate court in Indiana ruled an insurance carrier could not use IN worker’s compensation benefits to offset its liability for underinsured motorist benefits to the worker. Analysis and research by Pankhuri Parti, J.D.

Facts & Procedural History: In January 2011 Claimant Frye, suffered serious injuries in a car accident in January 2011. As part of his worker’s compensation claim he collected $692,895.79 in benefits from his employer’s compensation carrier – Auto-Owners Insurance Co. In the meantime the automobile liability insurance carrier for the motorist at fault for claimant’s accident also paid him its policy limit of $100,000. As allowed under the terms of the Act, Auto-Owners took $75,000 of this insurance payout in partial satisfaction of its lien and the remaining $25,000 went to claimant’s attorney. Auto-insurance had also issued a commercial automobile policy and commercial umbrella policy to claimant’s employer. Based on these policies claimant demanded additional payments from Auto-Owners.

Overall Auto-Owners paid claimant $1,282,314.21. This amount included $900,000 under the automobile policy, representing the $1 million coverage limit, less $100,000 from the other motorist’s insurer; and $382,314.21 under the umbrella policy, representing the $1 million coverage limit, less the $617,685.79 paid as workers’ compensation benefits.

Auto-Owners took the position that the $1,282,314.21 payment exhausted its obligation under the relevant policies, but claimant disagreed.

The limit for bodily injury claims under the umbrella policy was also $1 million when it was issued in November 2007, however, the general limit was increased to $5 million per occurrence starting May 2010. As such claimant argued Auto-Owners owed him coverage up to $5 million. Claimant also argued Auto-Owners was not entitled to take an offset for the amount of his workers’ compensation benefits.

A federal judge in Indiana rejected both arguments and granted summary judgment finding the payment of $1,282,314.21 exhausted Auto-Owner’s liability to claimant.

In Frye v. Auto-Owners Insurance Co., the 7th U.S. Circuit Court of Appeals determined Indiana WC law applied to the dispute. It ruled Indiana Code Section allowed Auto-Owners to abstain from providing underinsured motorist coverage in the umbrella policy issued to claimant’s employer. As Auto-Owners had decided to provide the underinsured motorist coverage in the umbrella policy, the Appellate Court said Indiana Code Section 27-7-5-2(a) required the carrier to provide that coverage in limits equal to or greater than the policy’s general liability limit of $5 million.

The Court also ruled the carrier was not entitled to reduce its liability under the umbrella policy in the amount of claimant’s workers’ compensation recovery. Under the terms of the policy, Auto-Owner’s liability could be reduced by the amounts payable as workers’ compensation benefits which were in excess of the retained limit and the parties did not dispute the retained limit for the policy was $1 million. Since the workers’ compensation payments received by claimant did not exceed $1 million even when considered in combination with the $100,000 obtained from the other motorist’s insurance, no portion of those payments could be subtracted from Auto-Owner’s liability cap.

This was researched and written by Pankhuri Parti, J.D. who is licensed in both IN and IL. If you need assistance with an IL, IN, WI, MI or IA workers’ compensation claim, we assure you no-one knows the rules/nuances better than the defense team at KCB&A. We are happy to assist—simply send a reply or email pparti@keefe-law.com.

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