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An Act To Improve The Workers’ Compensation
SystemHB 194/SB 200
Why Reform? Concerns about costs in TN Higher than states around TN Detriment to bringing new jobs to TN
○ Some current employers want to opt out
Concerns about court system Inconsistency
○ “Race to the courthouse” Claims in the court system take too long
Concerns that process is too complex and too lengthy
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Under $1.50$1.50 – $1.99
$2.00 - $2.49$2.50 – $2.99
$3.00 – $3.49
Workers’ Comp Costs/$100 Payroll by State
2012 Oregon Workers’ Compensation Premium Rate Ranking, Oregon Dept. of Consumer & Business Services
Why Reform? Length of Time in Court Date Injured Worker Reaches Maximum Medical Improvement
Number of Days from Maximum Medical Improvement to Trial
8/18/2008 1487
10/23/2008 1147
3/18/2009 793
3/31/2009 667
4/28/2009 643
8/10/2010 530
9/30/2009 471
8/9/2010 232
1/3/2011 382
2/25/2011 634
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Primary Areas of Reform Administrative Structure
Workers’ Compensation Division becomes an independent unit in Department of Labor & Workforce Development
Administrator is appointed by the Governor for a term of 6 years with limit of 2 terms
○ Can be removed for cause or nonperformance Judicial function moved from courts to Division
○ Predominant model in United States
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AdministrativeCommissionJudicialW.C. Court (Commission)
WORKERS’ COMPENSATION SYSTEM STRUCTURE BY STATE
Workers’ Compensation Court Workers’ Compensation Judge
Hears claims under rules of civil procedure and rules of evidence
Must be 30 years old, be a licensed attorney, have 5 years experience in workers’ compensation law
6 year terms, with maximum of 3 termsAppointed by Administrator
○ May be removed for cause Decisions can be appealed
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Workers’ Compensation Court Chief Judge
Performs duties of judgeAdministers day-to-day operations of court Licensed attorney with 7 years of workers’
compensation experienceTerm of 6 years
○ Maximum of 2 termsMay be removed for cause
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Workers’ Compensation Court Workers’ Compensation Appeals Board
Separate from Court of Workers’ Compensation Claims
Governor appoints the 3 judges○ Licensed attorneys with 7 years experience in
workers’ compensation○ Term of 6 years, limit of 2 terms
Further appeal may be made to Supreme Court
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Primary Reform Areas
Change the Definition of Causation○ Injury is compensable if it arose “primarily in the
course and scope of work” when all other possible causes are considered.
○ Definition of key phrases
Statute must be construed fairly and impartially
Replaces language that statute must be liberally construed in favor of the employee
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Approaches to Determine Causation
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Must be major contributing cause to be compensableMust be significant cause to be compensableSubstantial cause for certain illnesses to be compensableDoes not require above to be compensable
Primary Reform Area - Disability Benefits All impairment ratings to body as a whole Impairment rating from treating physician is
presumed to be accurate Employee receives benefits if returns to
work after MMI with any employer earning 100% of pre-injury wage Impairment rating times 450 (increase from 400)
times 66 ⅔ % average weekly wage
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Permanent Partial Disability Benefit If employee does not return to work or
makes < pre-injury wage, employee will receive additional benefits:Factor of 1.35 if doesn’t return to workFactor of 1.45 if no HS diploma or GEDFactor or 1.2 if > 40 years of ageFactor of 1.3 if unemployment in county where
employed > 2 points above state average for year prior to initial period of compensation
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Disability Benefits Timeline
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Temp Total Disability
Imp rating * 450 * 66 ⅔% AWW
Additional benefits
Maximum medical improvement
If worker does not return to work for ER at 100% wage
Date of Injury
Temporary Total Disability Benefit Now
Continues until employee reaches maximum medical improvement and impairment rating is assigned by physician.
Can continue for 104 weeks if mental injury.
Delayed if employee is in pain management treatment.
Not always offset against permanent benefits.
Proposed Ends when employee
reaches maximum medical improvement.
No exceptions for mental injuries or pain management.
If paid after maximum medical improvement, benefits are offset against permanent benefits.
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Primary Reform Area - Mediation
Greater emphasis on already successful programHelps resolve temporary benefits and
medical treatment disputesHelps parties resolve issues related to
permanent benefitsAdditional requirements to act in good faith
New certification of dispute processIf parties cannot agree, disputes must be
certified before appearing before judge
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Major Reform Area - Ombudsman
Robust education and assistance program to workers who do not have an attorneyOmbudsman is neutral, no legal advice Provides education on rights and obligations of
all parties and service providersEffective direction on preparation of formsHelps injured employees understand process
and what they need to do to resolve disputes
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Major Reform Area – Medical Selection of Medical Panel Simplified
One panel, not three for initial treating physician and additional panels for specialists
Treating physician can make referral to specialist if one is needed○ Employer has 3 days to give a panel of 3 or
treating physician’s referral stands
Greater continuity of care, less friction, speedier treatment
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Communications with Physician Employer is allowed to communicate
with treating physicianIn writing or orally
Removes requirement that employee sign a waiver before employer can review records
Only applies to medical records related to treatment for the workers’ compensation injury
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Medical Treatment Guidelines To be adopted by 2016 Will improve utilization review process
Any treatment that follows guidelines presumed to be medically necessary○ Addresses an area of concern to employees,
physicians, and the division
Intended to reduce disputes, improve quality and timeliness of medical treatment
Fees for appeals to offset costs
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Expected Results of Reform
A workers’ compensation system that is fair, efficient, and provides
better outcomes for employees and employers
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EmployeesMore assistance to understand the processProcess that is easier to understandEmphasis on resolving disputes before “court”Faster access to “court”
○ Expedited hearings for catastrophic injuriesImproved medical treatment
○ Fewer delays for utilization reviewQuicker return to pre-injury jobsFaster delivery of benefits
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Employers Fairer, more predictable environment
Quicker, simpler resolution of claims○ Improved relations with injured workers○ Less concern about venue○ Lower administrative costs
Quicker return of employees to their jobs○ Less disruption in operations
More conducive to expanding operations or coming to Tennessee
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Expected Results of Reform
Helps make Tennessee the #1 state in the Southeast for
high quality jobs
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Questions?
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