Overview: Illinois Workers’ Compensation Changes (HB 1698)

June 1, 2011

General Assessment: Overall, this is a proposal that improves Illinois’ workers’ compensation system and will lead to lower costs. It addresses several important elements of the law some of which are retackling the shortfalls of the 2005 revisions. This measure makes a down payment on reform, but it is not worthy of being characterized as bringing significant reform to Illinois’ workers’ compensation law. It does not reflect significant reforms that guarantee employer cost reductions through a higher causation threshold, strict AMA guidelines or strong employer directed medical care networks. Thus, three of the four Illinois Chambers’ major recommendations for achieving truly substantive reforms were inadequately addressed. As other states are advancing true reform, Illinois WC system will remain high cost and out of the mainstream of the country.

The Chamber did not support HB1698 because it does not meet the test of truly reforming the state’s workers’ compensation laws, but we did not oppose the legislation as it represents positive, incremental change. The Chamber is officially neutral on the bill.

Causation: Our highest priority to change the “causation” standard to make the workplace the major contributing cause of an accident or injury fell 5 votes short in the Illinois Senate (SB 1349). HB 1698 merely codifies current case law regarding proof by the preponderance of the evidence by the injured worker that the injury was "arising out of" and "in the course of" employment.

 

AMA Guidelines: HB 1698 introduces to Illinois statute for the first time AMA guidelines to help determine impairment. We had sought AMA Guidelines as a means to introducing greater certainty and objectivity to Commission rulings regarding disability. Unfortunately, HB 1698 adds medical based records to age, occupation and future earnings as an additional subjective factor for consideration by non-medically trained arbitrators.  We are concerned that the goal of AMA Guidelines will be severely undermined.

 

PPO Networks/Employer Directed Medical Care: Our goal was to strengthen the value of employer directed medical care through PPO networks. While HB 1698 allows limited employer direction of care through a PPO, it falls woefully short of our objective. Employer directed health care is proven to save costs by yielding better medical outcomes which leads to lower disability, quicker return to work and less future medical care. HB 1698 dilutes the value of a PPO network by allowing an employee to easily opt out of the network care at any time, thus potentially allowing the problem  of “doctor shopping” and related out of network referrals for high cost procedures.  In addition, it provides for a third choice of doctor outside of the network if the injured worker petitions the Commission claiming the second network provider care is improper or inadequate.

 

Utilization Review (UR): UR was first introduced to Illinois’ workers’ compensation law in 2005, but has proven to be generally ignored by the Commission and not as effective as was intended. This proposal strengthens the statutory provisions for UR and may be used to help control out of network medical expenses. It is the only major priority that we believe has been adequately addressed in HB 1698. A provider is required to make reasonable efforts to provide timely and complete reports of clinical information needed to support request for treatment. If the provider fails to make such reasonable effort, the charges for service may not be compensable or collectable from the employer or the employee.

 

A written notice of UR decisions including clinical rationale and references to applicable standards of care or evidence based medicine be provided to provider and employee is required. HB 1698 shifts the burden to the employee by a preponderance of evidence that the variance of care from the standard of care used by the UR entity is reasonably required. A deposition procedure to allow deposition of reviewers outside of Illinois is created. HB 1698 provides that an admissible utilization review must be considered by the

Commission, along with all other evidence and in the same manner as all other evidence, and must be addressed along with all other evidence in the determination of the reasonableness and necessity of the medical bills or treatment.

 

Medical Fee Schedule: Of the cost saving features contained in HB 1698, the bulk of the savings will be experienced by the 30% reduction in the medical fee schedule that is effective September 1, 2011. For out of state medical services, the reimbursement rate paid is the lower of the other state fee schedule, the charge or the region fee schedule rate where the employee resides. Four non-hospital regions and 14 hospital regions are to replace the 29 geozips effective January 1, 2012. If a medical claim does not contain data elements to adjudicate the bill, within 30 days, an employer/insurer must provide the basis for denial and describe any additional data elements needed. Any interest penalty for nonpayment of medical bill are to be paid within 30 days of bill payment. A prescription drug fee schedule for drugs dispensed outside of a licensed pharmacy at no more than average wholesale price (AWP) plus a $4.18 dispensing fee is created.

 

Caps wage differential awards: Caps wage differentials at the later of age 67 or five years from date when award becomes final. Estimated savings is $23-87 million depending on the percentage change in non-schedule PPD benefits.

 

Alcohol & Drug Intoxication: While several improvements are made in that HB 1698 establishes a standard of 0.08 alcohol and any finding of illicit drugs as a measurement of intoxication and the burden of proof is shifted to the injured employee, the language restricts the finding to “sole cause” instead of “proximate cause” which does not adequately place the responsibility on the employee for their use of drugs or alcohol in the workplace.

 

 

Commission Changes: Perhaps the biggest wild card for employers is the change to the Commission offered by HB 1698. Standards for the ethical conduct of Commissioners and arbitrators are set. All arbitrators are terminated July 1, 2011. The Workers’ Compensation Advisory Board may make recommendations regarding the initial set of arbitrators reappointed or new. The initial set of arbitrators must have advice & consent of Senate. Arbitrator terms are staggered every 3 years with 12 subject to reappointment by Commission on July 12012, 12 on July 1, 2013 and the remainder on July 1, 2014. Training requirements for Commissioners and arbitrators in the areas of ethics, fraud detection, improving health care outcomes, AMA Guidelines, UR practices and aspects of black lung are added. A minimum of 3 arbitrators may be assigned per site with cases assigned randomly. No more than 2 years of an arbitrator term at 1 site except for Cook County sites. Newly appointed arbitrators must be an attorney. Current non-attorneys are grandfathered. Commission employee claims are to be handled by an independent arbitrator not employed by the Commission. Arbitrator or Commission decisions are to be based exclusively on evidence in the record of the proceeding and material that has been officially noticed. A new section prohibiting an attorney appearing before the Commission from providing compensation or any gift to any person in exchange for the referral of a client involving a matter to be heard before the Commission has been added.

 

 

Carpal Tunnel Injuries: Carpal tunnel hand injuries are limited to 15% of 190 weeks except for cause shown by clear and convincing evidence in which case the award may not exceed 30% of 190 weeks.

 

Fraud: An intentional submission of medical bills for services not provided is added as fraud. It provides for step up of criminal penalties based on severity of crime starting with misdemeanor to Class 1 felony. A concern we had back in 2005 was rectified when disclosure of the complainant to alleged perpetrator will be eliminated. HB 1698 clarifies that restitution may be sought in a civil action regardless of the result in a criminal prosecution. The ability to subpoena medical provider and a requirement for the Department of Insurance to purchase a fraud system also are added.

 

Collectively Bargained Workers’ Compensation: The voluntary option to allow collective bargaining for workers’ compensation was emasculated by making it a pilot program limited to Operating Engineers and Steelworkers.

 

Other changes affecting employers:

 

  • Requires electronic medical payment system rules from Department of Insurance by July 1, 2012 and compliance with acceptance of electronic billing by payers on or before June 30, 2012.
  • Employee Leasing Company reporting to the Commission
  • Employer non-compliance fines for lack of insurance coverage of $500-$2500
  • For determining temporary partial disability benefits changes "net" amount of  earnings in modified job to "gross" earnings
  • Workers’ Compensation Advisory Board terminated as of effective date with new Board appointed within 30 days
  • Requires NCCI recalculation of rates on or before September 1, 2011
  • Department of Insurance reporting requirements that require insurers to report specific items to DOI.

 

Services

S & H offers a full range of worker’s compensation, LTD/STD, personal injury and major medical case management services, customized for your individual needs. We are dedicated to your complete satisfaction.

RN Medical Case Management

Catastrophic Case Management

Catastrophic injuries or illnesses can strike at any time. S & H Medical Management Services, Inc. is your source for goal-directed, timely and cost-effective catastrophic case management services. The S & H goal for RN catastrophic case management is to provide an immediate, mutually beneficial (to both the injured worker/recipient and the claims handler) response, ensuring facilitation of the medical care required to return this injured worker/recipient to a productive life.

S & H CAT Care is performed by registered nurses experienced in trauma, orthopedic or neurological injuries. At a time when information is scarce and the family, the employer and the adjuster require a connection to real-time information, the S & H CAT Nurse is there to facilitate the needed communication, assess if treatment is timely, aggressive and is being provided at an appropriate facility! Many times the initial contact with the family made by the S & H CAT Nurse is the first contact the family will have with an employer or adjuster representative.

The S & H CAT Nurse is there to keep all parties focused on the goal of a safe and timely return to work and/or appropriate utilization of resources.

The nurse works closely with all parties to ensure communication and appropriate care during the first critical hours and days following a catastrophic injury coordinating if necessary, a transfer of treatment to a Center of Excellence. S & H is available 24 hours/day - 7 days/week.

Call 630-226-5036 when catastrophic case management is required.

On-Site RN Case Management

Sometimes referred to as full or field case management. Usually will include (with account authorization) three point contacts, with the employer, physician and injured worker. The Nurse Consultant will typically meet with the injured worker and the physician, and coordinates care as authorized by the referral source. A safe and effective return to work is facilitated through communication with all involved parties.

Utilization Management & Coordination of Utilization Review

You cannot be treated for a non-work-related accident or condition without your group health carrier implementing utilization review. If you go to a hospital or medical caregiver for non-work-related problems, someone somewhere is looking at the costs and approving what is necessary and reasonable. Implementation of UR in non-work-related settings isn't by accident; it is done because the cost savings are enormous.

S & H Medical Management believes that UR when done well, is a strong alternative to an IME. However, why spend the time and expense for your cases to go through the previous models for UR?

S & H Medical Management Services, Inc. has developed a 2 prong approach to ensure your utilization of UR is appropriate, time-sensitive and cost-effective. First, S & H Nurse Consultants utilize the Medical Disability Advisor to research if the treatment & RTW guidelines meet evidence based medicine (EBM) guidelines. Second, if it appears treatment or RTW is outside EBM guidelines, S & H has partnered with a peer review organization to perform the actual UR.

Our partner for UR is URAC accredited and licensed to provide W/C UR in all 50 states! This partner is a truly independent source for UR, and utilizes objective EBM practices and provides literature reviews as part of their reports. The reviews are conducted by physicians the first time! A definitive answer is available regarding approval or denial, without having to go to the “second or third tier”.

Turnaround time can be as quick as 24 hours, no later than 72 hours. Specialists and sub-specialists can be engaged for the initial review, should the RN and client determine this is the best approach. Referrals are made online – again minimizing turnaround time! S & H has negotiated special pricing with our UR partner.

One Time/PRN appointment coverage

Also referred to as a Task Assignment. The RN confirms attendance of the appointment with the physician and the injured worker. The RN attends the appointment to obtain the information specified by the account. The report to the account following the appointment can be in the form of an email, or dictated report, depending on the account requirements.

Limited Assignment

Typically entails review of Medical Records, scheduling an Independent Medical Evaluation, documenting the questions to be asked of the physician in a letter format, ensuring the attendance of the injured worker, coordinating retrieval of all diagnostic studies and meeting with the physician and possibly the injured worker, at the time of the examination. A report is provided to the account, and the need for any ongoing services is addressed with the account before proceeding with ongoing services.

Telephonic Medical Case Management

Provided by our RN staff for a prescribed period of time. Task assignments may be utilized when appropriate to facilitate file movement. Telephonic services are provided for workers' compensation, STD/LTD & Health Insurance. We also provide TCM global services.

Integrated Absence Management Program

As part of an integrated absence management program, S & H Medical Management Services, Inc. can help you reduce your STD/LTD claim costs by providing quality, cost effective vocational and medical case management services. These services are designed to a ssure the insured receives timely  medical care, assist your employers in developing effective return to work programs, obtain documentation to verify the medical  necessity of the requested LOA and provide vocational support to both the claims examiner and the insured with respect to issues of employability and return to work assistance.

It is critical that as soon as an individual enters a claim for STD, the treating physician, employee and employer work together to effect a positive recovery and eventual return to work.  The S & H Nurse Consultant will utilize nationally recognized parameters when addressing these issues with the physician.  The physician will be requested to provide functional capabilities at each appointment.

Health Insurance Case Management

The principles of case management that make the S & H Medical Management Services, Inc. Nurse Consultant successful in providing case management in the W/C, STD & CAT Care™ arenas, are also utilized with S & H Health Insurance Case Management. 

The S & H Health Insurance Nurse Consultant utilizes a Case Management Model focused on the recipient/patient.  The end result is medical care that is appropriate and of the highest quality.  The goal in this process is for the client/patient to obtain this care, while preserving the recipient/patient’s health care dollars for future needs, whenever possible.  This collaborative process is accomplished through assessment, planning, implementation, coordinating, monitoring and evaluating. 

The S & H Health Insurance Nurse Consultant communicates with the recipient/patient, family,   providers, ancillary services, insurance companies and employer, if appropriate.  An initial assessment is performed, utilizing the S & H specially-designed format, and the S & H Medication Adherence Assessment™ based on CMAGII guidelines.

Medical Records Analysis

Also referred to as Medical Legal File Review for Causation, is performed by our RN staff. The Nurse Consultant contacts the account prior to documenting findings, to ascertain the specific reporting format to be utilized.

Negotiation of DME and Home Health Providers/vendors

A service that is routinely performed by our RN consultants as a component of On-Site RN Case Management, but can be performed as a stand alone limited service.

On-Site Job Analysis

The RN can perform an on-site job analysis (including video if requested) to assist in addressing causation issues or to delineate the functional requirements of an injured worker’s position for usage in designing a structured physical therapy rehabilitation program.

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