Council on Worker’s Compensation
Meeting Minutes
GEF-1 Building
Madison, Wisconsin
September 17 , 2013

Members present: Mr. Beiriger, Ms. Bloomingdale, Mr. Brand, Mr. Brandl, Mr. Buchen, Mr. Redman, Mr. Kent, Mr. Metcalf, Ms. Nugent, Ms. Pehler, Mr. Ginsburg, Ms. Thomas and Mr. Schwanda

 Staff present: Mr. Aiello, Mr. Ezalareb, Mr. Krueger, Mr. Moreth, and Mr. O’Malley

  1. Call to Order/Introductions: Mr. Metcalf convened the Worker’s Compensation Advisory Council (WCAC) meeting at approximately 10:00 a.m. in accordance with Wisconsin’s open meetings law. WCAC members, staff and members of the audience introduced themselves.

  2. Representative Dan Knodl: Representative Dan Knodl, Chairman of the Assembly Committee on Labor, attended the meeting and introduced himself and met with the members of the WCAC. Representative Knodl is looking forward to working with the WCAC. Worker’s compensation has been a strong program in the past. To keep balance in the system there is a need to review some topics including rising medical costs.

    Representative Knodl and Senator Glenn Grothman, Chairman of the Senate Committee on Judiciary and Labor, forwarded a letter to the Council containing a few items for the WCAC to consider. Another letter will be sent to the WCAC which includes additional topics for consideration. Representative Knodl expressed his willingness to meet with the WCAC and discuss issues raised by legislators. Representative Knodl expressed his wishes for the WCAC to come up with a productive and good quality bill that will go forward in the Legislature.

    Representative Knodl thanked the WCAC for allowing the health care provider liaisons an additional 30 days to submit their proposals. There is still time to act on a worker’s compensation agreed upon bill in the legislature this session. Representative Knodl stated that he would like to consider a single bill from the WCAC this session. The members of the WCAC thanked Representative Knodl for appearing at the meeting.

  3. Approval of Minutes: Ms. Bloomingdale moved to approve the minutes of the June 11, 2013 meeting.Ms. Nugent seconded the motion. The minutes were unanimously approved.

  4. Correspondence: Mr. O’Malley reviewed the correspondence received by the WCAC since the last meeting.

    A letter dated June 13, 2013 was received from Mr. David Crawford from Crawford Evaluation Group advising that it was an employer of 14 Wisconsin employees and has experienced cost for worker’s compensation escalate largely due to unchecked medical costs. Mr. Crawford stated his company joined Wisconsin Employers for Equitable Worker’s Compensation. In the letter Mr. Crawford urged the WCAC to continue working towards an agreed upon bill that includes a medical fee schedule and a shorter statute of limitations that is in line with the rest of the country.

    A letter dated June 19, 2013 was received from Ms. Shari Laskowski from Chet’s Plumbing Heating, Inc. advising that she was an employer of 20 Wisconsin employees and has experienced cost for worker’s compensation escalate largely due to unchecked medical costs. Ms. Laskowski stated her company joined Wisconsin Employers for Equitable Worker’s Compensation. In the letter Ms. Laskowski urged the WCAC to continue working towards an agreed upon bill that includes a medical fee schedule and a shorter statute of limitations that is in line with the rest of the country.

    A letter dated August 20, 2013 was received from Representative Dan Knodl, Chairman of the Assembly Committee on Labor, and Senator Glenn Grothman, Chairman of the Senate Committee on Judiciary and Labor, requesting the WCAC to provide the health care provider liaisons with an extension of the September deadline for providing their legislative proposals to allow them up to an additional month to analyze new data from the Wisconsin Compensation Rating Bureau. They expressed the hope that the extension would not continue after October 15, 2013. Representative Knodl & Senator Grothman expressed a hope the WCAC can continue to work on other issues facing the worker’s compensation system including but not limited to the following:

      • Addressing the issue of employees providing false statements on employment applications, and how this could affect their benefits. Providing greater clarity for providers and businesses as to the definition of “light duty” under section 102.43 (9) (a).
      • Providing greater clarity for providers and businesses as to the definition of "light duty" inder section 102.43 (9) (a).
      • Strengthening reporting and accountably of fraudulent PTD claimants.
      • Limited consequences for the actions of workers who may injure themselves while under the influence of a controlled substance.

    Representative Knodl and Senator Grothman also advised that in the upcoming weeks they will be providing the WCAC with a more detailed letter of additional issues from legislators they hope the WCAC can address in recommendations for this session.

    An email message dated September 6, 2013 was received from Steve Schneider from the American Insurance Association (AIA), Mark Johnston from the National Association of Mutual Insurance Companies (NAMIC), Jeff Junkas from the Property and Casualty Insurers (PCI) and Andy Franken from the Wisconsin Insurance Alliance (WIA) recommending the adoption of a medical provider fee schedule based on the Medicare Resource Based Relative Value System (RBRVS) with a uniform conversion factor applicable to all covered services with no special carve-outs. In the email message they also urged the WCAC to adopt a pharmaceutical fee schedule for physician dispensed drugs based upon a drug’s average wholesale price plus a modest dispensing fee as was recently done in Illinois, Indiana and Michigan.

    A letter dated September 9, 2013 was received from Senator Sheila Harsdorf and Rep. Erik Severson advising the WCAC of legislation they introduced relating to Cottage Industries and requested the WCAC’s input on the proposed legislation. SB-276 (LRB/1192) seeks to provide an additional exclusion of certain independent contractors from coverage under the worker’s compensation law and unemployment insurance law in addition to exclusions in the current law. The bill proposes to exclude independent contractors from coverage when the individual has done all of the following: has signed a written agreement with the employer for the work to be performed stating the intention to be an independent contractor; the individual performs the work primarily at his or her residence; primarily uses his or her own tools or equipment; and performs the work free from control direction of the employer.

  5. Permanent Total Disability Study Committee: Mr. Aiello updated the progress of the Permanent Total Disability Committee. The Department is continuing to monitor the outcome of cases in which compensation for permanent total disability (PTD) was claimed to determine if the cases are resolved by litigation, finding of fact orders or compromise settlements. The committee is studying claims made for permanent total disability for a six month period from October 1, 2012 through March 31, 2013. A total of 273 claims for permanent total disability were made during that time. This is about 14% of all applications for hearing filed in this timeframe. 168 of the 273 cases have been resolved to date by compromise agreements, finding of fact orders, stipulations or dismissals. None of these claims involved either conceded or statutory permanent disability cases. In five cases employees were declared permanently totally disabled by finding of fact orders. Mr. Aiello also stated that a survey of other states about providing cost of living increases to permanently totally disabled claimants will be available later. At the request of Ms. Pehler the Department will provide more detailed information on the cases where employees are found to be permanently and totally disabled.

  6. Xcel Energy Services, Inc. v. LIRC: Mr. O’Malley reviewed the Wisconsin Supreme Court’s recent decision in Xcel Energy Services, Inc. v. LIRC, Case No. 2011AP203. There were four issues presented to the Court. The issue of primary concern for the WCAC was whether the worker’s compensation insurance carrier should be an adverse party named on the summons and complaint in an action for judicial review of an order issued by the Labor and Industry Review Commission under s. 102.23 (1), Wis. Stats. The Court held that the insurance carrier was not an adverse party to the employer and did not need to be included on the summons and complaint. In a concurring opinion, Chief Justice. Abrahamson stated there was continuing uncertainty about whom to name as adverse parties in actions for judicial review under s. 102.23 (1), Wis. Stats., and for the WCAC to propose to the legislature revisions to s. 102.23 (1), Wis. Stats., to clarify who must be included as a party in judicial review actions. Mr. O’Malley stated that in view of this case there may be another proposal for the WCAC to consider related to clarifying the parties to be named in judicial review actions.

  7. 2013 Wisconsin Act 36 – s. 102.17(1) (c) & (ct), Wis. Stats.: Mr. O’Malley discussed an amendment to s. 102.17(1) (c) & (ct), Wis. Stats., that was included in 2013 Wisconsin Act 36.This amendment pertains to the Department’s procedure for granting licenses to appear for individuals who are not licensed to practice law in Wisconsin. The amendment provided the Department may deny an application for a license to appear, deny renewal of a license to appear or revoke a license to appear if it is determined that the individual is liable for delinquent unemployment insurance contributions. Section 102.171) (ct), Wis. Stats provides for a hearing process for individuals to contest denials, non-renewals or revocation of a license to appear before the Department.

  8. Senate Bill – 276(LRB/1192/2): Mr. O’Malley discussed SB -276.This bill was introduced on August 29th, 2013 in the Wisconsin State Senate. A companion bill was also introduced in the Wisconsin State Assembly as AB-358 on September 13th, 2013.These bills were referred to committees. This is the proposed legislation discussed in the letter of September 9th, 2013 from Senator Harsdorf and Representative Severson. The bill provides that an independent contractor is not an employee of an employer for whom the independent contractor performs work or services if the independent contractor meets three conditions. The first condition is that the individual has signed or an entity owned by an independent contractor has signed a written agreement with the employer stating that the individual is performing the work or services as an independent contractor. The second condition is the individual performs the work or services primarily at his or her own residence and primarily using his or her own tools and equipment with “primarily” meaning 75 percent or more. The third condition is the individual performs the work or services free from the direction or control of the employer other than the control or direction provided for purposes of initial training or quality control.

    Mr. Beiriger inquired if an employer under this bill is entitled to exclusive remedy protection. Mr. O’Malley advised that exclusive remedy protection for employers is not included in the language of the bill. Mr. Metcalf advised that health insurance plans may not cover individuals who are treated as independent contractors under this bill. Mr. Krueger advised that the language in the bill did not apply to the definition of independent contractor of other entities such as the Internal Revenue Service, Wisconsin Department of Revenue and the Social Security Administration.

  9. Correspondence from Senate and Assembly Labor Committee Chairs: The members of the WCAC discussed the letter dated August 20, 2013 from Representative Knodl & Senator Grothman. The Wisconsin Compensation Rating Bureau data is expected to be available on October 4th, 2013.Members of the WCAC may get in touch with the Wisconsin Compensation Rating Bureau for access to the data.

    Mr. Kent requested the Department to draft memos about the four points mentioned in the letter from Representative Knodl and Senator Grothman. Mr. Kent stated that the Americans with Disabilities Act does not permit employers to include questions about individuals’ physical condition on employment applications. He also commented about the third bullet point relating to fraudulent claims and that no one is in favor of individuals engaging in fraudulent claims to not be sanctioned. Mr. Kent recommended to the Council that the Department of Justice may function as a backup if local district attorneys do not want to bring charges.

  10. Other Council Business: Members of the WCAC discussed future meeting dates. October 15th, 2013, November 12th, 2013 and December 3rd, 2013 are dates for future meetings.

  11. Adjournment: Motion by Mr. Beiriger for members of the WCAC to go in to caucus and then to adjourn, seconded by Ms. Bloomingdale. The motion carried unanimously and the meeting was adjourned at approximately 11:15 a.m.
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