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Council on Workers' Compensation
May 9, 2017
The Department of Workforce Development provided public notice of this meeting under Wis.
Members present : Ms. Bloomingdale , Mr.
Mr. Dernbach(Chair), Ms Frank, Mr. Fugina, Mr. Gunderson, Ms. Johnson, Mr. Kent, Mr. Reader,
Mr. Reader: Mr. Redman: Ms. Seiler; Ms. Thomas , and Mr. Tindall
Member Excused: Mr. Schwanda
Staff present: Ms. Brown, Mr. Evenson, Mr. Holland, Mr. Krueger, Ms. McCormick, Mr.
Moreth, Mr. O'Malley, and Mr. Payne
- Call to Order/Introductions: Mr. Dernbach convened the
Worker's Compensation Advisory Council(WCAC) meeting at approximately 10:05
a.m. in accordance with Wisconsin's open Meetings law. Mr. Dernbach called
the roll of members. Members of the audience and Worker's Compensation Division staff
Approval of minutes:. A motion was made by Mr. Tindall to approve the minutes of the
March 14, 2017
meeting . Ms. Bloomingdale seconded the motion. The minutes were unanimously
approved without correction.
Office of Worker's Compensation Hearings Update:
Administrator of the Division of Hearings
and Appeals (DHA), presented an update on
the Office of Worker's Compensation Hearings
He provided clarification regarding
some of the concerns raised at the last WCAC
meeting. DHA is attached to the Department
of Administration (DOA) for administrative
purposes in the same way that the Labor and
Industry Review Commission (LIRC) is
attached. DHA contacts DOA for personnel
matters but otherwise is able to maintain
distance and independence regarding hearing
matters and decisions. Mr. Hayes also
clarified that he is a classified employee
as are the hearing examiners/ALJs he is
authorized to hire.
Since joining DHA in 2016, OWCH has accounted for about
30 percent of the Division's total case load. In 2016, the number of hearing
applications received was 5,183. OWCH issued 6,018 orders, of which 337 were
Finding of Fact Orders and 4,538 were orders approving compromise
agreements. In 2016, 177 cases were appealed to LIRC.
As accomplishments since the transfer of adjudicatory
functions from DWD to DHA, Mr. Hayes advised that the average case backlog
was reduced from 275 to 169 days. He also stated that all decisions after a
hearing has been held are issued within 90 days and orders approving
compromise agreements are signed within 21 days. A mediation unit was also
created that keeps approximately 300 cases from going to hearing.
Mr. Dernbach thanked Mr. Hayes for attending the
meeting and informed the WCAC that he and Mr. Hayes have been communicating
on almost a weekly basis while transitioning the adjudicatory functions from
DWD to DHA.
- Correspondence: Mr. O'Malley reported the department
received no correspondence since the last meeting.
- Motion to Caucus:
Council members requested additional information regarding the use/abuse
of opioids and deferred any proposals related to this issue until further
information is presented by the medical community at the June WCAC meeting.
Mr. Reader moved the members go into closed caucus before exchanging
proposal. Ms. Bloomingdale seconded the motion. By unanimous vote, the
members went into closed caucus at about 10:45 a.m. The members returned
from caucus at about 12:25 p.m.
- Public Proposals:
Mr. O'Malley advised that no additional
public proposals were received since the last meeting. A summary
listing all public proposals received to date was distributed.
The summary was also posted on the DWD website.
- Department Proposals.:
A handout of the Department's proposals
was distributed at the meeting. Proposals Nos. 1, 2 and 3 were
discussed at previous meetings along with several technical
proposals. Proposals No. 4 and No. 5 were presented having to do
with fund appropriation and accounting of the Work Injury
Supplemental Benefit Fund (WISBF) and the Uninsured Employers
Under 2015 Wis. Act 55, DWD was to
collect up to $5 million per year to be used to provide
reimbursement to insurers paying supplemental benefits and
to pay claims made against the WISBF that had been put on
hold due to solvency issues with the fund. Under 2015 Wis.
Act 55, the Department could collect the monies but could
not pay them out. Proposal No. 4 recommends the creation of
a new Worker's Compensation s. 20.445 Alpha appropriation
that would be a Segregated Annual Funds appropriation (SEG),
with $5.0 million of annual budget authority included in
Fund 227. The proposal would not increase revenue for DWD-WC
or increase assessments on stakeholders.
Proposal No. 5 relates to the Uninsured
Employers Fund (UEF) which pays claims for injured workers
whose employers illegally operate without required worker's
compensation insurance coverage. The UEF pursues collection
from employers to recoup payments made on those claims.
Currently, payments made into and out of the UEF come from
two separate accounts and must be manually merged. The
Department recommends modifying the designation of
appropriation 20.445 (1) (sm)
Uninsured employers fund; payments from a Segregated Sum Sufficient
appropriation to a Segregated Revenue Continuing appropriation to more
accurately reflect the actual fiscal process for the appropriation and create
efficiencies for accounting and budget transactions and cash balance reporting.
- Labor and Management Proposals:
Mr. Reader presented the Management
Proposals, which were as follows:
- Medicare-Based Fee Schedule :Establish a Medicare-based fee
schedule to bring Wisconsin in line with the majority of states. Set initial
fee schedule at 150% of Medicare starting with 2017 Medicare rates. The fee
schedule shall adjust annually in line with medical CPI.
- Employer directed care.
Allow employers to specify a list of health care providers who are authorized to
provide care for injured workers. The list shall include at least 6 health care
providers, at least three of who must be physicians who are geographically
accessible and have specialties that are appropriate based on anticipated
work-related medical problems of employees. The list must include contact
information and must be displayed in a prominent location.
- Treatment guidelines.
Establish treatment guidelines in Wisconsin based on
ODG or another appropriate
national model. Guidelines must be followed unless pre-authorization is received
- Electronic billing/payments.
Require that all providers caring for
worker's compensation patients utilize electronic billing and be able to receive
- Electronic medical records.
Require all medical providers caring for worker's compensation patients to
transmit medical records electronically.
misrepresentation of physical condition.
Prohibit indemnity benefits to an injured worker if
the worker intentionally made a false statement as to their physical condition
after a job offer was made, the employer relied on the misrepresentation and
this reliance was a substantial factor in the hiring, and there was a causal
connection between the false misrepresentation and the injury.
- Worker's compensation denied by another state.
The state of Wisconsin should not
accept for review cases that have been denied
by other states for cause. Cases
that are contesting jurisdiction should be handled by the state, but cases that
have been denied in another state for compensability should not be considered in
- No PTD Benefits
once Social Security old-age assistance benefits begin; adjustment to
presumption of maximum earnings.
Current law provides for Permanent Total Disability
benefits for life. PTD Benefits should be terminated once the injured worker
receives Social Security old-age/retirement assistance benefits. Current law
sets PTD benefit rates for injured workers under the age of 27 at the rate they
would probably earn once they reach age 27, or the maximum rate if a probable
rate cannot be established. This age should be adjusted to 35 years.
- Reduction of benefits; amounts paid under another state's worker's compensation
law. Reduce benefits payable under Wisconsin law by any amount received by the
employee as worker's compensation benefits under the worker's compensation laws
of another state.
- Statute of Limitations.
Reduce statute of limitations to 2 years, except that in the case of
occupational disease caused by exposure to toxic substances there shall be no
statute of limitations, and where an employee's injury that is otherwise
undisputed requires a prosthesis or artificial joint, there shall be no statute
of limitations as to medically necessary treatment expenses directed to said
prosthesis or artificial joint.
- Eliminate wage expansion.
Benefits shall be based on actual earnings from the employer where the injury
occurred at the time of the injury.
- PPD minimum ratings.
Require the medical advisory committee under Wis. Stat. 102.44 (4m) (a) to
report its recommendations for revisions of the PPD ratings to the department
and the WCAC by the 1st day of the 6th month following the enactment of this
law. If a report with recommendations for revisions is not received by the
deadline, PPD minimum ratings for surgical procedures shall sunset.
- Notice of injury.
All initial reports of injuries must be made by the injured worker to the
employer according to the employer's procedures as posted or as outlined in an
employee handbook within 30 days of the injury.
- PTD re-evaluation.
An employer or insurer may request an injured worker receiving PTD benefits to
have their PTD ratings re-evaluated every three years.
- Disability determinations.
Permanent disability determinations must be made by occupational health
physicians or other qualified healthcare providers according to statutory
- Death benefits. There shall
be no death benefit in PTD claims
when the death is unrelated to the occupational injury or illness.
Mr. Reader indicated that many of Management's proposals
are aimed at addressing high medical costs in the WC system.
Routinely, year after year, when the WCRI
comes out with their studies every fall, Wisconsin is one of the highest, if not
the highest state when it comes to medical pricing or medical costs for worker's
compensation. Last year's report indicated that while we have a very good per
case or per injury average of 3% below average, that medical costs are 39% above
average. Many of the proposals are modeled after what other states have done or
are doing to address similar issues.
Mr. Tindall added that Management Proposal No. 8 is
intended to avoid a situation such as where an older worker, who might have two
years of work left before retiring, gets injured and, because of the work
injury, then receives 15 or 20 years of permanent total disability (PTD)
benefits; the PTD benefits act as a supplement to retirement instead of wage
replacement at that point.
Ms. Bloomingdale presented the Labor proposals, which were
- Permanent Partial Disability Benefit Maximum Rate: Increase of $20 per year. That would result in a maximum PPD rate of $382 for injuries on or after
January 1, 2018, and $402 for injuries on or after January 1, 2019.
Permanent Total Disability Supplemental Benefit: Two year bump in eligible
dates/rates. Current law provides for those injured prior to January 1, 2003 a
supplemental weekly maximum benefit rate of $669. A two year bump would include
injuries prior to January 1, 2005, and increase the maximum benefit rate to $711
- Scholarships: Provide for a statutory scholarship benefit for injured
worker's children, when a parent's injury causes death or permanent total
disability. Scholarship amount for each child would be for the tuition and book
expense for up to four years at a Wisconsin State University System school,
Wisconsin State Technical College System, or certified apprenticeship program of
the child's choice.
- Statute of Limitations extended by payment of medical expense. Current law,
s. 102.17(4), Wis. Stats., provides for a statute of limitations of six years
for traumatic injuries, measured from the date of injury or the last payment of
primary compensation (indemnity benefits to worker), whichever is later. Payment
of medical expense currently does not extend the statute of limitations. This
proposal would add the date of the last payment of medical expense as an
additional measurement point for the start of the statute of limitations.
- Shoulder Replacement: Amend s. 102.17(4), Wis. Stats., to include shoulder
replacement (reverse shoulder replacement) as an additional serious traumatic
injury with no statute of limitations.
- Increase Release of Unaccrued Benefits in Compromise Agreements: Increase
the amount of the unaccrued compensation that may be released to the injured
worker without restriction in a compromise settlement pursuant to s. DWD
80.03(1) (d) from $10,000 to $50,000.
- Eliminate Interest Credit on Advancements: Amend s. 102.32(6m), Wis. Stats.,
to change the interest credit to insurers for advancements of compensation from
the current 5% to zero %.
- Injured Worker Choice of Third Party Settlements: Amend s. 102.29, Wis.
Stats., (third party negligence cases) to change the law from the employer
having an equal voice in whether a settlement offer should be accepted to the
employee having the right to control the settlement or no settlement decision.
- Indexing of Permanent Total Disability Rate: Indexing with six year lag. For
injuries on or after January 1, 2018, index weekly benefits for permanent total
disability or continuous temporary total disability for more than 24 months
after the date of injury to the rate in effect at the time the benefit accrues
for periods more than six years after the date of injury.
- Posting of Injured Worker WC Rights: Require all employers to display a DWD
approved poster of WC employee rights at the workplace.
- Continuation of Health Care Coverage: If an employer fails to continue to
maintain group health care coverage for an injured worker during the period of
temporary disability, the employee is due an additional benefit equal to 100% of
the employer contributions that the employer failed to pay, in addition to any
temporary disability benefits under the Act.
- Loss of Earning Capacity for Scheduled
Injuries: If a worker suffers a scheduled injury, and if retraining has been
attempted but fails to fully restore the injured worker's pre-injury earning
capacity, or retraining is not feasible for the injured worker, allow a claim
for loss of earning capacity in the same manner as currently allowed for
- Indexing of Permanent Partial Disability Benefits After 200 Weeks: An
employee receiving PPD benefits after 200 weeks is entitled to the same
proportion of the maximum rate of PPD in effect at the time of payment beginning
with the 201st week of PPD benefit.
- Revise Loss of Hearing Measurements: Currently s. DWD 80.25(4) provides for the
calculation of the degree of hearing loss based on the decibel loss at
frequencies of 500, 1000, 2000 & 3000 Hz, and allows compensation for loss
averaging more than 30 db. This proposal would change the frequencies used for
the calculation of average loss to 1000, 2000, 3000, & 4000 hz, and allow for
compensation for loss averaging more than 25 db. This would also amend s. DWD
80.25(8) (Hearing Impairment Table) to access the PPD loss from 25 db (0%) to 88
Reporters: Retain the current use of court reporters for all hearings.
- Preserve LIRC: Preserve the Labor & Industry Review Commission as currently
prescribed by law for all matters (WC, UI, and ERD).
- Opioids: Labor requests that interested members of the Wisconsin medical
community, as well as the WCAC Medical Liaisons, be invited to address the WCAC
at the meeting on June 13, 2017 on the issue of opioids, bringing to the WCAC
any recommendations they may have on this issue. After hearing from the medical
community, Labor would reserve the right to then propose, if necessary, any
recommendations for changes in the WC Act.
Mr. Buchen asked what the basis was for the change to
the hearing loss threshold for benefits. Ms. Bloomingdale explained that a
loss of 25 decibels appears to have a significant impact on a person's life.
The hearing loss will frequently affect the ability to hear higher sounds
so, for example, in the English language someone may be able to hear an "o"
but not hear a "k" which is the highest pitched sound in the language.
Clarification was also sought regarding Labor Proposal No.
11 if the intent was that the employer would pay for only its portion or also
the employee's portion of the premium. Ms. Bloomingdale and Mr. Kent explained
that the intent is the employer would pay the employer's share of the premium
and the employee continues to be responsible for whatever his or her
contribution for the cost of the health insurance would have been but for the
injury so that coverage would not lapse. The purpose for this proposal is to
make the worker whole and avoid situations where non-work related conditions for the worker or
his/her family members will no longer be covered because of the worker's
inability to pay the premium during periods of disability.
- Other Business of the Council:
Mr. Dernbach provided a response from
Dr. Belton of the Workers Compensation Research Institute (WCRI),
who presented at the February 2017 WCAC meeting, regarding
how the WCRI calculates the timeliness of the payment of
indemnity benefits differently than DWD. A correction was
also made regarding an error on the WCRI slide presentation;
Tennessee's 30-day restriction on opioid prescriptions was
not worker's compensation specific as the slide had
Mr. Dernbach provided a legislative update. 2017
Assembly Bill 308 was referred to the Committee on Labor. AB-308 proposed
that the proportion of representatives for labor on the WCAC should be the
same proportion as employees in the state who are union members, with a
minimum of two (2) representatives. Representative Spiros and Senator
Stroebel have been invited to appear before the WCAC, as is customary.
2017 Assembly Bill 25, regarding child labor permits,
which was discussed at prior WCAC meetings, passed the Wisconsin State
Assembly and was scheduled for s vote on the Wisconsin Senate Floor the next
Adjournment:. A Motion was made by Mr. Reader to adjourn
the meeting and for the Labor and Management members to go into closed caucus.
The motion was seconded by Ms. Bloomingdale. The motion passed
unanimously. Ther meeting was adjourned at approximately 1:10 p.m.
The next Worker's Compensation Advisory council meeting will be held on Tuesday, June 13, 2017