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Website - Division of Worker's Compensation
Email - WC Administration
Website - Division of Worker's Compensation
Email - WC Administration
Members present: Ms. Bean, Mr. Beiriger, Mr. Brand, Mr. Buchen, Ms. Connor, Mr. Furley, Ms. Huntley-Cooper, Mr. Kent, Mr. Newby, Mr. Olson, Mr. Shaver, Ms. Vetter and Mr. Welnak
Excused:Mr. Gordon
Absent:
Staff present: Mr. Conway, Mr. O’Malley, Mr. Krueger, and Mr. Shorey
Call to Order/Introductions: Ms. Huntley-Cooper convened the Worker’s Compensation Advisory Council (WCAC) meeting in accordance with Wisconsin’s open meetings law. All in attendance at the meeting were requested to identify themselves and their business/professional organization.
Minutes: Mr. Welnak moved adoption of the minutes of the June 8, 2005 meeting. Ms. Vetter seconded the motion. There were no corrections. The motion was unanimously approved.
Navitus Pharmacy Proposal: A pharmacy proposal from Mr. Allan Zimmerman, president of Navitus, was removed from the agenda. Mr. Buchen stated that this topic was removed from the agenda for this meeting because of the amount of time the presentation would take. Mr. Buchen stated that proposals concerning Professional Employer Organizations (PEOs) would not be covered at the meeting. Mr. Buchen stated that these topics would not be covered at the meeting because of concerns about not having enough time to discuss other issues.
Review of Proposals: Lee Shorey reported on the current status
of the Work Injury Supplemental Benefit Fund (WISBF). At this time there is
a balance close to $6,000,000 in the fund. Income into the WISBF was up
about $200,000 for this fiscal year. Expenditures paid out of the WISBF will
be up about $300,000. For the last fiscal year total expenditures were
between $2,700,000 - $2,800,000. The trend is that the WISBF balance is not
significantly up or down. Payments for barred claims from the WISBF are
increasing. For this fiscal year payments for supplemental benefits will be
up by about $25,000.
Previously the balance in the WISBF had been up to about
$8,000,000-$9,000,000. However, the law requires that the balance cannot
exceed more than three (3) times the amount paid in the previous fiscal
year. A few years ago the balance was down to about $4,000,000. This was
after assessments (payments into the fund) were suspended for several years.
Now there is about $6,000,000 in the fund. That is about a two (2) year
balance. Going to a one (1) year balance may be risky.
Reimbursements to insurance companies for supplemental benefits are made in
the period from March to the end of June. If there is an increase in
benefits in 2006, we will not see expenditures rise from this until almost
July 2007.
Payments for fatalities into the WISBF amount to $543,000. Payments into the
fund for fatalities where there are no dependents amount to about
$2,500,000. Payments into the fund for dismemberments amount to $244,000. Interest
payments are about $116,000. Interest payments were a little higher this
fiscal year.
For the last year payments out of the WISBF last year include about $725,000
for supplemental benefits. About $600,000 was paid for benefits due from the
Second Injury Fund. For barred claims about $670,000 was paid for hearing
loss. About $300,000 was also paid for legal services and medical services
for barred claims. Over $1,000,000 is paid for all barred claims. Payments
for the Children's Fund are also made from the WISBF. The amount for this
was about $370,000.
Expenditures for the WISBF for this fiscal year will be
$3,200,000-$3,300,000. We do not prepare a final report until about one (1)
month after the end of the fiscal year. About $48,000 was paid for traumatic
barred claim injuries.
Mr. O’Malley discussed forfeitures under s. 102.35 (1), Wis. Stats., and
that Article X, section 2, of the Wisconsin Constitution required
forfeitures to be deposited in the school fund. Staff from the Worker’s
Compensation Division contacted the Legislative Reference Bureau (LRB) for
more information about forfeitures and the possibility of having the
forfeiture payments made into the WISBF rather than the school fund. The LRB
advised that the school fund payments were made to libraries and that money
collected as forfeitures under s. 102.35 (1) could be rerouted to the WISBF.
This would require an amendment to s. 102.35 (1) to require the payment of a
“surcharge” instead of a forfeiture. There are about 26 other situations
where forfeiture payments were rerouted for purposes other than the school
fund. Statutory changes were made in s.814.75, Wis. Stats., to reroute
forfeiture payments for these other purposes. Mr. Shorey indicated that this
was another potential source of income to the WISBF and rerouting forfeiture
payments in this manner would generate about $200,000 annually of additional
revenue.
Mr. Shorey discussed using settlement payments for additional income to the
WISBF. These monetary settlement payments are now deposited into the
Uninsured Employers Fund. The WCD has discretion about where the settlement
payments are deposited. The WCD has collected about $350,000 over the last
four (4) years. The amounts received in settlements varies. In some years
the amount is high and low in other years. This is another potential source
of income for the WISBF, but it cannot be counted on as a dependable source
of revenue.
Discussion/Debate on Submitted Proposals: Mr.
Buchen distributed a one (1) page summary of proposals where there were
tentative compromises. He advised these were a subset of issues of what have
been resolved.
Mr. Shaver stated the Management position on the proposal to increase the
maximum limit on the amount for the bad faith penalty. The maximum amount
would be increased from $15,000 to $25, 000, but the 10% delay of payment
penalty and 12% interest under s. 648.46, Wis. Stats., would be done away
with.
Mr. Furley discussed Labor Proposal No. 5 concerning final medical reports
to clarify the language that is proposed. The language, “where surgery was
performed” is to be added to the administrative code provision. Adding this
language is to include cases where surgeries are performed as well as cases
with more than three (3) weeks of temporary disability and any permanent
disability as cases that require filing a final medical report from the
treating practitioner.
The Employee and Employer members met in separate closed sessions but did
not complete deliberations. Mr. Newby and Mr. Buchen requested that another
meeting be scheduled.
For the PEO/Employee leasing proposal Mr. Newby and Mr. Buchen requested
staff from the WCD draft language that addresses proof of
coverage/cancellation-termination notice and experience rating.
Review of Correspondence: Mr. Conway reviewed three (3) letters
that were received since the last meeting. The first letter was from
National Association of Professional Employer Organizations (NAPEO) with
language for proposed statutory amendments concerning PEOs/Employee leasing.
The second letter was from Myron A. Mehlman, Ph. D. concerning benzene
induced chronic myelogenous leukemia. The third letter was from Attorney
John Edmondson about insurance carriers not providing adequate reasons for
denying claims and proposed changes to DWD 80.02 (1)(g) of the Wisconsin
Administrative Code.
Adjournment: Discussion was concluded and the meeting was adjourned at approximately 6:20 PM. The next meeting has been scheduled for July 29, 2005 beginning at 10:00 a.m. at a location to be determined in Madison.