Wisconsin Employers for Equitable Worker’s Compensation

A coalition in support of an equitable workers’ compensation system

The Wisconsin Worker’s Compensation Advisory Council released an agreed bill August 23 which, if approved by the State Legislature and Governor Scott Walker, will put in place a fee schedule to control medical costs associated with work injuries.

The Council’s “agreed bill” package must be drafted into statutory language and reviewed by the council before going to legislative committee. Public hearings on the bill will be held this fall.

Wisconsin is one of just six states without such a fee schedule, and medical costs for worker’s compensation are far higher in Wisconsin than most other states.

According to the Worker’s Compensation Research Institute’s (WCRI) CompScope Benchmarks for Wisconsin 2016 study:

  • Wisconsin had the highest average per-claim medical payments from 2014-2015.
  • Prices for non-hospital services and hospital outpatient services were highest in Wisconsin, compared to 27 other states in the same study.
  • Wisconsin employers pay more than double the typical price for common services, like pain management injections, radiology services and even basic evaluation and management.
  • Prices for worker’s compensation medical treatment grew faster than any other study state from 2009-2014.

Every two years, the state of Oregon ranks all 50 states and the District of Columbia on the overall rate for worker’s compensation costs. In 2014 Wisconsin was 23rd, and in 2016 rose to the 12th most expensive state for worker’s compensation.

Along with the fee schedule, the agreed bill increases the Permanent Partial Disability rate by $20/week in 2018, and $25/week in 2019 – more than double the average annual increase for those benefits. These increases partially make up for 2013-2016, when no updates were made to the worker’s compensation act and PPD  rates were unchanged for four consecutive years.

The Wisconsin Compensation Rating Bureau estimates the PPD increases will increase overall Worker’s Compensation insurance rates by .99% for 2018 policies, and 1.15% for 2019 policies.

The total PPD paid on non-litigated work comp claims in Wisconsin in 2014 was $87.7 million. That same year, the total spent on medical treatment for work injuries was about $650 million. Applying the proposed 2019 rate of $407/week of PPD, the total non-litigated PPD would be $110.9 million, an increase of about $23 million. The fee schedule needs to trim just 3.5% from the medical cost to cover that increase.

The Department of Workforce Development will produce detailed fiscal estimates on the impact of the agreed bill provisions, but early indications are the fee schedule will save employers much more than the increased PPD benefits will cost.

Medical providers will mobilize opposition to the agreed bill, pointing to recent decreases in overall rates for worker’s compensation insurance in Wisconsin. However, those decreases are due to reduced frequency and severity of injuries. In fact, despite reduced frequency and severity of injuries, worker’s compensation medical costs in Wisconsin rose about 5 percent last year.

Integrated Risk Solutions is mobilizing Wisconsin Employers for Equitable Worker’s Compensation (WEEWC) to rally employers to support the agreed bill. Please join WEEWC for informational rallies September 27 and 28 to learn more about the agreed bill and what you can do to support this legislation. Click here to register for these important meetings.

Labor committee hearings on the agreed bill could take place as soon as the week of October 16, with committee votes as early as October 24. The bill could go to the floor of the house by October 31 for a vote, and if approved could go to Governor Walker by Dec. 7.

To view the entire agreed bill package, click here:

Contact John Tindall at jtindall@intrisksolutions.com for more information.