Worker's Compensation Advisory Council

Council on Worker’s Compensation
Meeting Minutes
Madison, Wisconsin
March 22, 2005

Members present:  Mr. Beiriger, Mr. Brand, Ms. Connor, Mr. Furley, Ms. Huntley-Cooper, Mr. Kent, Mr. Newby, Mr. Olson, Mr. Shaver, Ms. Vetter, and Mr. Welnak

Excused:  Ms. Bean and Mr. Buchen
Absent:  Mr. Gordon

Staff present: Mr. Conway, Mr. O’Malley, Mr. Shorey, Mr. Krueger, and Ms. Knutson

  1. Call to Order/Introductions:  Ms. Huntley-Cooper convened the Worker’s Compensation Advisory Council (WCAC) meeting in accordance with Wisconsin’s open meetings law. 
  2. Minutes:    Mr. Brand moved adoption of the minutes of the February 21, 2005 meeting; Mr. Beiriger seconded the motion. The motion was unanimously approved. 
  3. Public Comments:  Ms. Debra Guenterberg and Mr. Robert Guenterberg appeared before the WCAC. Mr. Guenterberg suffered a 1997 work injury which resulted in permanent disability. Ms. Guenterberg expressed concern regarding the length of time before a formal hearing is held in disputed cases. Many permanently injured workers find themselves in severe financial distress while the dispute is being resolved. Ms. Guenterberg expressed concern that permanently and totally disabled workers are forgotten with no consideration for the effect of the injury on the families and benefit rates are not escalated. Mr. Newby explained that permanent total disability benefit rates were currently being studied by a subcommittee with recommendations to be presented to the WCAC. Ms. Guenterberg raised other issues including postponements, definition of permanent total disability, mental health issues, hiring vocational experts and payment of attorney’s fees out of the injured worker’s benefits. Mr. O’Malley explained that drafting a definition of permanent total disability that everyone would agree to is not realistic. Permanent total disability is determined on a case by case basis considering the statutory presumption and case law. For more complicated cases, attorneys can be of assistance. In cases of hardship, if the parties are ready, cases can be scheduled on short notice. Ms. Huntley-Cooper explained that the WCD has a committee addressing hearing backlog issues.

    Mr. Ed Hayden from Allied Construction appeared and expressed concern with ERISA health funds (Taft-Hartley Funds) making advance payments for medical expenses for work-related injuries and not being reimbursed when the worker’s compensation dispute settles. Carriers settle the claim and include a hold harmless clause in the settlement agreement. Carriers often only offer a small percentage of the medical expenses paid by the health fund. The money in the health fund belongs to the participants. If the employee’s attorney provides evidence that the injury may not be work-related, the health fund will agree to a reduction in their reimbursement amount. Mr. Hayden suggested that the WCAC enact a change in the law prohibiting carriers from entering into hold harmless agreements. The health fund is looking at ways to collect money from the employees and their attorneys in these situations. Mr. Welnak commented that some health funds do not pay the medical bills until the employee has exhausted the worker’s compensation appeal process.
  4. Subcommittee Reports
    Medical Cost Committee – Mr. O’Malley presented the committee’s three recommendations for changes in Chapter 102, Wis. Stats pertaining to medical costs.
    The committee recommends that Wisconsin adopt a pharmacy fee schedule. This proposal requires pharmacies to provide the generic equivalent of a name brand drug unless no generic drug equivalent is available or the prescribing physician provides a “no substitutes” order. Prescription drugs will be paid by a formula with no balance billing to the injured worker. The formula will include the average wholesale price as listed in the Blue Book or Red Book plus a dispensing fee. State and federal taxes would apply. If there is a dispute as to whether the injury is work-related, the pharmacy fee schedule would not apply. The WCAC agreed with this proposal and suggested that the doctor indicate on the prescription that the drug was necessary to treat a work-related injury.

    The second recommendation is that Wisconsin adopt the Minnesota Treatment Parameters. The department would adopt a rule to include relevant provisions as stated in the Minnesota Treatment Parameters. The treatment parameters would be used to evaluate the necessity of treatment in the event of a dispute. Some of the provisions of the Minnesota Treatment Parameters including pre-certification and employer choice of doctor would not apply to Wisconsin and would not be included in an amendment to Wis. Admin. Code §DWD 80.73. If there is a dispute as to whether the injury is work-related, the parameters would not apply until adjudication has been made on that issue. A committee of experts would be formed by the department to amend the rule. If no alternative is adopted by a date certain, the Minnesota Treatment Parameters would be adopted initially. Due to changes in the rulemaking procedures, the process to promulgate new rules takes approximately one year. The WCAC agreed with this proposal. The WCD will begin the process to modify the Minnesota Treatment Parameters to conform to Wisconsin law.

    The final proposal involves restricting “outlier” health care providers. The purpose of the proposal is to protect injured workers from treatment by a health care provider, or a medical examiner hired by a payer that in the opinion of peers is using a pattern of treatment, evaluation, or diagnostic practices that substantially deviates from generally accepted standards for the conditions presented in the injury or disease. Criteria (involving complaints by claimants, insurers/self-insured employers or providers, or a number of necessity of treatment disputes finding treatment to be unnecessary in the amount of $1000 or more) would be established for evidence necessary to trigger an investigation. The complaint would be reviewed by WCD, investigated, and if reasonable cause exists the WCD can take action including commencing a peer review, issuing an order suspending ability of the provider to treat occupational diseases for a period up to five years and referral to the Department of Regulation and Licensing for possible disciplinary action. The WCAC members raised various issues with this proposal including the criteria for filing a complaint with the WCD and possible retaliation by providers. Further action on this proposal was tabled until the next meeting.

    Permanent Disability Rates – Mr. Shorey reported that a report setting forth different alternatives with actuarial information would be provided to the WCAC members before the next meeting. Included in the alternatives is a cost of living annual adjustment, elimination or partial elimination of death benefits if the injured worker dies due to causes other than the work injury, an age limitation and variations in lag time before the benefit increases take effect. Issues to consider include the effect on the Social Security offset and funding. A definition of permanent total disability is not included in the proposal. It is anticipated that if the WCAC accepts one of the alternative proposals, it would become part of the agreed bill.
  5. Correspondence:   The WCAC was presented with letters from the Wisconsin Compensation Rating Bureau (WCRB) and the Office of the Commissioner of Insurance (OCI) regarding the Professional Employer Organization (PEO) proposals. In addition, the WCD received an e-mail from Mr. Jeff Lavitch. His proposal will be included in the public proposals compiled by the WCD.
  6. Update on DWD WC Division's Law and Administrative Rule Proposals:  Mr. O’Malley explained the department proposals (all references are to the proposal numbers).
    2. Subsection (b) was added to conform to the Unemployment Insurance (UI) Division’s proposal following a Labor and Industry Review Commission decision in a UI case. Mr. Krueger indicated that the WCD would be meeting with WCRB, OCI and PEO staff to discuss possible revision of the department’s proposals before the next WCAC meeting. The WCRB and OCI have concerns regarding the effect of the proposal on experience ratings.

    12. The WCD modified the language of this proposal to coincide with the Unemployment Insurance statute, §108.14(7)(b). Mr. O’Malley reported that the WCD currently does not provide direct connectivity to organizations to retrieve data. The organization provides the data elements needed for their research and WCD mines the data, stores it in a password-protected zip-file, and e-mails the data to the organization.
    25. This proposal amends DWD 80.50 to update the rule to include reference to increased PPD benefits for injuries to the dominant hand. This has no effect on benefits for disfigurement.

    26. This proposal amends DWD 80.68(1) and (3) to correct the statutory reference.

    27. This proposal amends DWD 80.72(2)(L) to update the rule to include advanced practice nurse prescribers (APNPs).

    28. This proposal amends DWD 80.73(2)(d) to update the rule to include physician’s assistants and APNPs.

    29. A new subsection is created in response to the recent Wisconsin Supreme Court decision in Gehin v. Wisconsin Group Ins. Board, No. 03-0226 (Wis. Feb. 23, 2005). In that case, the court found that uncorroborated medical reports constituted hearsay and could not be relied upon by the administrative agency in issuing a decision.

    30. This proposal addresses the same concern as #29 in reference to certified reports of industrial safety specialists.
  7. Labor and Management Proposals: Labor and Management exchanged proposals.

    Regarding Labor proposal # 1, Mr. O’Malley commented that the WCD was approached by the Division of Vocational Rehabilitation indicating that DVR may not be able to pay for tuition, fees and books for employees with work-related injuries. Mr. Kent commented that as a result of the DVR budget reduction, they would make an effort to seek revenue streams from other sources to pay for tuition, fees and books.

    Regarding Management proposal #10, Mr. O’Malley indicated that when the proposal was introduced during the last agreed bill process that the Wisconsin Judicial Commission indicated the Wisconsin Supreme Court must agree that administrative law judges are covered by the Code of Judicial Conduct. Previously the Chief Justice had expressed an opinion that administrative law judges are not in the judicial branch of government. By administrative code, the WCD could adopt some of the provisions of the Code of Judicial Conduct. The state civil service rules regarding discipline apply to administrative law judges. Some aspects of the Code of Judicial Conduct include off-work conduct, including partisan political activities that really do not apply to administrative law judges because they are not elected. The members of the WCAC indicated the same concerns raised regarding ALJ conduct and demeanor during the last agreed bill session still exist.

  8. Adjournment:   Discussion on all agenda items concluded and the meeting was adjourned. The next meeting has been scheduled for April 13, 2005 beginning at 10:00 a.m. Future meetings are also scheduled for April 26, 2005 beginning at 10:00 a.m. and May 11, 2005 beginning at 1:00 p.m. All meetings are scheduled at Holiday Inn Madison East.