Wisconsin Employers for Equitable Worker’s Compensation

A coalition in support of an equitable workers’ compensation system

WEEWC Outlines 2017-18 Agreed Bill Goals

The 2017-2018 agreed bill cycle is shaping up to be one of the most pivotal in Wisconsin’s pioneering worker’s compensation history. A fee schedule to bring medical charges in line with the rest of the nation is a real possibility, along with controls on treatment that will ensure quality care without runaway bills or unnecessary disability. Proposals in the state budget could undermine a fair and reliable process for adjudicating disputed worker’s compensation claims. Disability rates, the statute of limitations, and which injured workers are eligible for permanent disability compensation are all on the table for potential changes.

It has never been more important for employers to get involved.

Medical Cost Containment and Treatment Guidelines

Wisconsin Employers for Equitable Worker’s Compensation (WEEWC) supports a four-part proposal for cost containment and medical treatment guidelines. The proposal will be presented to the Worker’s Compensation Advisory Council by the management caucus at the May meeting.

The proposal establishes a medical fee schedule tied to established Medicaid rates, creating a fair, predictable mechanism for controlling the cost of medical care. The fee schedule would include an “upper,” a percentage markup above the Medicaid rate to fairly compensate medical providers for quality care. The percentage is yet to be determined – other states have markups ranging from 125 percent to 400 percent.

Current law allows for disputes of medical fees, defining “reasonable” fees as those that are no more than .8 standard deviations above the mean fee for the service or procedure being billed. That mean is determined using one of several state-certified databases, which rely on actual billing practices of medical providers. According to the Worker’s Compensation Research Institute (WCRI), this process results in medical fees for worker’s compensation claims in Wisconsin that are as much as 300 percent greater than most other states. Wisconsin’s medical costs are greater than other states studied, and have consistently increased more dramatically, according to the WCRI.

Wisconsin is one of just six states that do not have a medical fee schedule for worker’s compensation.

Along with the fee schedule, the proposal establishes meaningful treatment guidelines that give employers and medical providers a consistent set of best practices for handling worker’s compensation injuries. These guidelines would be based on nationally-recognized best practices established by occupational health providers.

Employers gain another level of certainty under a directed care element of the proposal. This would establish a system of identifying effective occupational health providers, and allowing employers to direct injured workers to providers in this pool. Directed care may be limited to the first 90 days following an injury, or another period yet to be determined.

Finally, the proposal calls for administrative efficiencies aimed at expediting communication and saving costs for employers and medical providers alike. These efficiencies may include bill payment timeframes, electronic records and reduced fee disputes.

Worker’s Compensation Appeals Process

Governor Walker’s proposed state budget calls for the elimination of the Labor and Industry Review Commission (LIRC) and defunds court reporters for worker’s compensation hearings. Both could jeopardize the process by which disputed worker’s compensation claims that have already been heard and decided by an administrative law judge (ALJ) are appealed.

When a worker’s compensation claim is disputed and the parties are unable to reach a compromise agreement, the case is resolved through a hearing with an ALJ. If either party feels the ALJ’s decision is incorrect, they can appeal the case to LIRC. If the LIRC decision is not satisfactory, a party can then appeal the case to circuit court, appellate court and ultimately the Supreme Court.

LIRC is by statute “the ultimate fact finder.” That means if an ALJ errs in deciding which facts are credible at hearing, LIRC can overturn the judge’s decision. LIRC’s review of cases is new or fresh – “de novo” in legal parlance. The language in the budget not only eliminates LIRC, but makes the ALJ the ultimate fact finder. Appeals under the budget’s language would be based on errors of procedure only, not facts, and would be heard by the Administrator of the Division of Hearings and Appeals. The administrator would not be able to reverse the ALJ’s decision, but only remand the case back to the ALJ for reconsideration.

WEEWC supports a compromise that preserves an independent, de novo review of ALJ decisions, with the power to reverse those decisions based on the facts of the case. A proposed budget amendment would create a new review body for the sole purpose of hearing WC appeals. This body would have all the powers of LIRC (the ability to reverse ALJs, and the ability to review cases de novo). The three-person body would include two persons appointed by the governor for staggered six-year terms, plus the administrator of the division of hearings and appeals. WEEWC believes this compromise would retain the indispensable appeals process.

The budget also eliminates funding for court reporters at worker’s compensation hearings. Without court reporters, the record of a worker’s compensation hearing is in jeopardy. Audio recordings are unreliable. Court reporters are professionals who are able to identify for the record which party is speaking, ensure intelligible responses, and weed through the chorus of voices often heard during complex proceedings. These key controls are lost when the record relies on an audio recording.

The two-year budget for the Division of Workers Compensation is set in the biennial state budget with funding generated by an annual administrative assessment on insurance carriers and self-insured employers. Thus, employers bear the cost for court reporters through worker’s compensation premiums.

If the department ceases funding for court reporters, attorneys for both employers and injured workers say they will hire their own stenographers. That will create confusion as to which is the official record, and add expense for employers in the form of appearance and transcript fees. The measure is a net loss for employers.

WEEWC favors the continued funding of court reporters by the Department of Workforce Development.

Statute of Limitations

In 2016, the worker’s compensation act was changed to include a carve-out of the 12-year statute of limitations for “traumatic” injuries, reducing the statute for those injuries to six years. However, the statute of limitations remains 12 years for “occupational” injuries and diseases. The bar for proving an occupational injury is low – requiring that an employee show only that the work exposure was a causative factor in the condition. The shortened statute is so easily defeated, the change is effectively meaningless.

WEEWC supports a true reduction in the statute of limitations to two years, with a carve-out only for true toxic exposures. Diseases like silicosis and mesothelioma can certainly be due to workplace exposures, and take years to incubate. Allowing these claims years after the end of employment is the right thing to do. Paying for treatment of degenerative joint disorders years after the end of any work exposure is unfair.

Wisconsin employers interested in the agreed bill cycle, and in a fair worker’s compensation environment in our state, have a voice through WEEWC. Please contact John Tindall for more information.

For more information on WEEWC contact John Tindall at jtindall@intrisksolutions.com.