Employers of workers injured in Illinois will have greater control over where those workers get care, while medical providers will see a sharp decrease in the fees they can collect for treating worker’s compensation patients. Those measures highlight several changes in the amended Illinois Worker’s Compensation Act approved by the state assembly May 31. The bill awaits signature by Governor Patrick Quinn, who has said he will sign it.
The bill was approved on its second trip through the house, which defeated the measure Memorial Day weekend. Supporters of Worker’s Compensation reform threatened to pass a bill repealing the state’s comp act altogether if the amended act was allowed to die. The house took up the matter again late the following Tuesday and approved it. Most of the new rules take effect September 1, 2011.
Medical Savings
The bill’s most controversial component is a reduction in the fee schedule that determines how much worker’s compensation insurers reimburse physicians and other medical providers. Medical providers bill insurance companies for treatment, and the insurers then adjust the bills through a network, fee schedule or other agreement. Currently, bills for worker’s compensation treatment are paid at 76 percent of the billed amount. As of September 1, the amended act reduces that to 53.2 percent. Published reports estimate the annual savings for employers and their insurers at $500-$700 million.
Additional savings should come from injured workers treating with more reputable and effective providers. While employers will not have authority to direct their injured workers to specific medical providers, worker’s compensation claimants will have to seek treatment only at clinics approved by “preferred provider programs.” These programs will be approved and administered by the Illinois Department of Insurance. Employers must notify claimants at the time they report their injury of the provider network. Employees may then select a provider from the approved list.
Further control over medical care is provided in the new act by beefing up utilization review, a peer review process for determining necessity and appropriateness of treatment. Utilization Review (UR) has been in place for several years, but arbitrators traditionally disregarded the findings when deciding cases. New language in the approved bill states that UR findings “must be addressed along with all other evidence …”
Permanent Partial Disability Formalized
Permanent Partial Disability – money awarded to workers for the lingering effects of a work injury – has traditionally been determined by attorneys haggling over the perceived value of an injury. Settlement values of prior cases involving similar injuries set a rough framework for negotiations, but little structure was involved.
The amended act sets forth five criteria that must be used when determining PPD: a report from the treating physician, using American Medical Association guidelines; the employee’s occupation; the employee’s age; the employee’s future earning capacity; and evidence of disability “corroborated by the treating medical records.”
The act also requires that when arbitrators make decisions on PPD ratings that “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.”
PPD ratings for carpal tunnel syndrome are capped at 15 percent loss of use of the hand – 28.5 weeks of disability – unless clear and convincing evidence of greater impairment is shown, in which case the award cannot exceed 30 percent.
The weekly benefit for PPD remains 60 percent of the employee’s average weekly wage.
Additional Changes
The bill attempts to limit opportunities for fraud by specifying that the burden of proof for any work injury is on the employee. It also makes it possible to deny claims in which injured workers were intoxicated or high when an injury occurred, if it can be shown that the intoxication was a cause of the accident or injury. A blood alcohol level of .08 at the time of injury will be sufficient to presume that the intoxication was a cause of injury, and it will be the claimant’s burden to prove it was not the sole cause in order to receive benefits.
The bill caps awards for “wage differential” claims, in which an employee suffers an injury that results in permanent restrictions and a loss of earning capacity. Previously awarded for life, these benefits are capped at five years from the date of the award or age 67, whichever is later.
The Illinois Industrial Commissions board, as well as the arbitrators that adjudicate work comp disputes, are all terminated as of September 1. They may seek reappointment to three-year terms.
The text of the bill is online at http://www.ilga.gov/legislation/97/HB/09700HB1698sam003.htm. Scroll down to page 18.