Illinois Workers’ Compensation Reform Treading a Difficult Path

by | Published on Aug 30, 2017 | Workers Compensation

Illinois workers’ compensation system was created at the beginning of the twentieth century, when many workers were engaged in dangerous industrial jobs. Workplace accidents and injuries would be evaluated on the basis of a comprehensive medical records review before the due compensation is granted to the injured worker. However, the manufacturing and mining industries have now become much safer and employ fewer Americans. Health and safety regulations introduced have undermined most of the original rationale. The modern American worker has different needs too compared to earlier workers. Now workers have to balance work with elder care or child care and employers have taken steps to accommodate such requirements with innovative working practices such as telecommuting, results-based employment contracts, and flexible hours. However, the workers’ comp system has not evolved likewise and penalizes employers who try to accommodate the changing needs of workers.

Illinois has one of the oldest workers’ compensation systems in America, dating back to 1911. The oldest system in the nation is that of Wisconsin that predates the Illinois system by a few months. These systems cannot meet the present day changed requirements of workers, which makes it very important for lawmakers to evolve workers’ comp rules to accommodate the changing needs of today’s workers as well as keep up with changes that are inevitable in the future. The system allows little decision-making power to the two key parties involved, namely, the employers and the workers. The system has grown in complexity and cost.

According to recent reports, workers’ comp reform in Illinois may be difficult in the current political climate in the state. In July this year, Illinois lawmakers voted to override Gov. Bruce Rauner’s veto of a package of budget bills and instate a budget. However, workers’ compensation reform considered in separate bills has yet to be considered. Steve Schneider of the American Insurance Association points out that the opportunity, sentiment, or climate for achieving positive workers’ comp reform is likely to be weak or even non-existing.

Experts in workers’ compensation say that Illinois ought to

  • Focus on implementing a drug formulary and instituting a ban on the dispensation of prescription drugs by doctors in a non-pharmacy setting. Steps in this direction have already been taken by other U.S states such as Texas, Michigan and New York.
  • Adopt a Medicare-based fee schedule system for medical procedures included in workers’ compensation. This will help to control costs, and 29 states already have a system like that.
    Though bills were introduced related to these, they couldn’t move forward. House Bill 4068, sponsored by Rep. Jim Durkin proposed a drug formulary. It proposed a Medicare-based fee schedule and would have capped maximum weekly benefits at $775.15 through 2021. An unambiguous Medicare-based fee schedule would help calculate and manage claim costs as well as medical costs. According to insurance trade associations, this bill addressed many of the major issues in the Illinois workers’ compensation system.

Other bills introduced in 2017 include:

  • House Bill 2525: to create a government insurance company that would help regulate the marketplace. Rep. Jay Hoffman, a sponsor of this bill said that it would bring overall reform by making Illinois a state that has prior rate approval of insurance workers’ comp rates, in addition to an enhanced fraud unit.
  • House Bill 2622: to create the Illinois Employers Mutual Insurance Co., a state fund. A sponsor of this bill, Rep. Laura Fine said that the bill would form a non-profit workers’ comp fund that would not be focused on making a profit. It would help to ensure that workers’ comp rates are kept low for Illinois employers.

However, insurance trade associations have opposed these 2 bills saying that the measures are “anti-reform” and do not address the actual issues. These bills are under review, and have yet to receive a signature from the governor.

Workers’ compensation lawyers and their partnering medical claims review companies would agree that Illinois workers’ comp system requires drastic reform that would benefit both employers and workers, and enable the system to keep abreast with the changing requirements of the modern workplace.

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