Category Archives: Legislation

Legislation, Workers' Compensation Reform, Workplace Accidents

The RETRO Program Is More Dangerous Than It Looks

Should Washington workers be happy about the RETRO program?

In a post from last week we introduced the history of the Workers’ Compensation System and asked the question: Should taxpayer money continue to be used to support the government system that allows these cases to be brought?

A growing number of employers in Washington State are taking part in the RETRO Program, a system within the system, designed with the good intention of incentivizing safer workplaces. Employers that participate in this program pay into the system according to the risk classes of their employees, as usual, but the actual costs of their claims are tracked and compared to the amount of the premiums paid. When the amount paid in claim costs exceeds the premiums paid, the employer is assessed an extra fee. If the claim costs are less than the premiums paid, a refund of the difference is returned to the employer. On the face of it, this seems reasonable, unless we look back to my bridge analogy from last week’s post:

When a bridge is needed in Seattle, those in Yakima don’t want to pay for it, even though our entire highway system supports tourism and commerce throughout the state. So, we have an insufficient tolling system in place based on the concept that only those citizens that drive on the bridge should have to pay for it.

The burden of injury and disability claims is greater on an individual employer than if the responsibility for the costs is shared.

Instead of incentivizing a safe work place we are now incentivizing denials of claims, denial of authorization for medical procedures such as MRI scans, and strict limitations on conservative care such as physical therapy. This creates a dynamic where Claims Managers at the Department of Labor and Industries are pinned between the interests of injured workers seeking benefits and employers counting pennies.

Caught in the middle of the storm, the easy decision for a Claims Manager is to deny benefits and let the issues be sorted out through the appeals process. This leads to delays in treatment, financial hardship and unfair costs to the injured worker, who remains responsible for the cost of attorney fees in litigation, whether they win or lose, when the employers have the ability to deduct the cost of legal fees as a business expense no matter the outcome. The practical effect of this increasing determination to cut every possible cost is that small issues are now routinely raised before the Board of Industrial Insurance Appeals.

We are involved in cases before the Board where the fight is over a few hundred dollars of compensation, or authorization for a procedure or surgery. Do we really want an industrial appeals judge to decide whether a procedure is reasonable and necessary treatment? Especially when there are utilization review processes already in place to monitor the use of those resources and Claims Managers hired to administer the claims, asking workers to bear the burden of an appeal process to get their MRI scan or to keep $300 in time loss compensation paid during the few days between the doctor mailing a release to work to the Department and the Claims Manager reading the note, often when the worker had not been notified of their release, is unreasonable and it is certainly a waste of resources.

More is spent fighting each claim than would be expended simply providing the worker with the benefit. But, providing the benefit comes out of the “claims cost” column, reducing the possible rebate amount, instead of under the “legal fees” tax deduction column.

Another effect of this new dynamic is that physicians are fleeing workers’ compensation claims like rats from the sinking ship. Doctors and clinics that are already working under the administrative burden of a plethora of insurance systems – – federal, state and corporate-run – – all with differing requirements and payment schedules, now find their every recommendation questioned and scrutinized, with payment delayed or denied. If an appeal process is followed, the doctors are asked to take time out of their packed schedules to write reports or testify at hearing or by deposition to justify their opinions, actions and recommendations. Patients have limited access to care or become frustrated when their doctors refuse to participate in the processing of their claims.

For more on the RETRO program, check in for part 3 of this series later this week.

 

Legislation, Workers Compensation

Workers’ Compensation: Are We Our Brother’s Keeper? Should We Be?

For over 100 years, the Workers’ Compensation system has protected workers in Washington State.

Just over 100 years ago, Washington State put into place our workers’ compensation system, providing the structure under which workers and businesses across the entire state pay into a fund to provide medical care, wage replacement, vocational retraining, total disability and death benefits to those workers injured, disabled or killed in the course of their employment. In exchange for their participation, businesses are provided immunity from lawsuit, even in cases of negligence. Workers are covered, even if they are at fault, if they are injured on the job.

“The common law system governing the remedy of workers against employers for injuries received in employment is inconsistent with modern industrial conditions. In practice it proves to be economically unwise and unfair. Its administration has produced the result that little of the cost of the employer has reached the worker and that little only at large expense to the public. The remedy of the worker has been uncertain, slow and inadequate. Injuries in such works, formerly occasional, have become frequent and inevitable. The welfare of the state depends upon its industries, and even more upon the welfare of its wage worker. The state of Washington, therefore, exercising herein its police and sovereign power, declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for workers, injured in their work, and their families and dependents is hereby provided regardless of questions of fault and to the exclusion of every other remedy, proceeding or compensation, except as otherwise provided in this title; and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished, except as in this title provided.” – RCW 51.04.010

The system has evolved over the decades to address changes in the workplace and in the economy. A balance has been sought between encouraging businesses to locate here, remaining profitable while maintaining safe workplaces, and providing the care and assistance to those workers injured or disabled on the job to reach a maximum level of medical improvement and return to gainful employment in a physically-appropriate job.

The majority of injury claims are handled by the Washington State Department of Labor and Industries, a state agency with no profit motive that is assigned the task to carefully administer the provisions of the program, directed by statute to be construed “to the benefit of the injured worker.”

Claimants, employers and providers are all parties to each claim, with the ability to protest or dispute an unfavorable determination made by the Department. If any party remains aggrieved, an appeal to the State’s Board of Industrial Insurance Appeals or beyond can be pursued. This system is not perfect, but it has worked well for many decades, allowing Washington to boast of relatively high benefit levels but as one of the lowest-cost systems in the country.

Shared Burden Versus Individual Cost Accounting

Washington is one of very few states where workers share the cost of the industrial insurance system, paying 50% of the medical aid premiums through payroll deduction. Premiums are set by risk class so that higher-risk jobs are charged higher premiums than the proverbial desk job. Everyone pays something into the system.

We all share the cost of caring for our injured brethren, be they male or female. The benefit reaped by those not injured is that their co-workers, family members, neighbors – their fellow citizens – who have the misfortune of becoming injured or disabled, have some income and medical care during their recovery. Some measure of belt-tightening may be required, but families of injured workers do not become instantly destitute.

Over the past thirty years or so, there has been a shift in thinking about the shared burdens, not just in Washington but across the country and within our national psyche. We don’t want to take care of others anymore. When a bridge is needed in Seattle, those in Yakima don’t want to pay for it, even though our entire highway system supports tourism and commerce throughout the state. So, we have an insufficient tolling system in place based on the concept that only those citizens that drive on the bridge should have to pay for it. This same attitude has now infected our industrial insurance system.

Should the overall citizenship be responsible for caring for it’s injured members? To what extent? For more in this issue, check back later this week with part 2 of this series. 

 

Legislation

Voting Has Never Been This Important To Workers

  • VoteI do not usually get on any political band wagons, but I feel compelled to reach out this election cycle to point out an issue on the ballot that I feel strongly about – Initiative 1082, the workers’ compensation initiative.  I have spent the last 24 years of my professional career in the area of workers’ compensation law.  It is a shame that this area of law, and this system, which is so little known and little understood by the general public  has made its way to the ballot via I-1082.  I fear that most voters, reading the plain language of the initiative, will unknowingly vote yes using what seems to be common sense to allow private insurance companies to start selling workers’ compensation insurance directly to employers in the State of Washington.  Competition is a good thing, right? Doesn’t sound like a big deal.

    One local business owner wrote an e-mail this morning saying that this initiative would raise his expenses by $13,000+ – in the first 18 months!

    I have always adhered to the sage wisdom that if you don’t know anything, or enough, about the implications of an initiative, it is always best to vote NO.  With I-1082 that is even more the case, because the implications are significant, and the devil is in the details of the 10 pages setting up this new system that you will not be reading on your ballot.  Here’s a few details for you–in Washington State, all workers have historically paid a percentage of industrial insurance premiums, sharing this expense with their employers.  Thus, we are all stakeholders in this system, and I think that’s a good thing.  This initiative will place the entire financial burden of industrial insurance premiums on employers.  So, this is not good news for business, who will see their costs rise significantly and immediately.  One local business owner wrote an e-mail this morning saying that this initiative would raise his expenses by $13,000+ – in the first 18 months!  Continue reading Voting Has Never Been This Important To Workers →

Legislation

I-1082: The Wrong Solution For Washington’s Workers’ Compensation System

No on 1082Almost one hundred years ago, Washington was one of the first states to enact the oldest social insurance program in our country – workers’ compensation.  It was part of a social compact between business and labor in which employees traded their right to sue in tort for their injuries for a more timely, but lower benefit, no-fault system to cover their injuries.  Only in the U.S. – among virtually all industrialized democracies with workers’ compensation systems – is the private, for-profit insurance industry permitted to underwrite these legislatively mandated programs and have any role in this social contract.  Our state has operated without the intrusion of the for-profit industry for its entire existence, and despite its faults and shortcomings, Washington’s system is viewed among the states as one of the most highly efficient and productive,  The proponents of I-1082 have simply not made a case for the so-called “reform” they claim privatizing our system will bring.  Reject this initiative – it is the wrong solution for our state.

Reject this initiative – it is the wrong solution for our state.

As we struggle to come out of the “Great Recession,” Washington voters face real issues, many created by our slumping economy.  Continue reading I-1082: The Wrong Solution For Washington’s Workers’ Compensation System →

Legislation

Seattlepi.com: I-1082 – Boon To BIAW, Bad For Workers

Reprinted from SEATTLEPI.COM EDITORIAL BOARD

Initiative 1082, if read carefully, reveals itself as a financial cash cow for insurance companies and the Building Industry Association of Washington — its prime sponsor — and sour milk for the state’s workforce.

The initiative would privatize the state’s worker compensation system by allowing insurance companies to compete with the state to provide coverage. The BIAW and similar groups could become partners with insurance companies in covering workers.

Workers comp, like Social Security, is a contract: The public has said to workers — those who put bodies and limbs at risk — that if injured you get compensated, and you don’t have to sue.

Opponents urge a reading of its fine print: The State Insurance Commissioner would be shorn of oversight, and what insurance companies would charge. In the words of I-1082, “Such rates shall not require commissioner preapproval prior to use.”

Insurers would not be required to give notice, to physicians or legal counsel or anybody, in a case where an insurance claim is denied: The insurer would have the power of indefinite delay and judging a worker’s injury and benefit claim, with no enforcement mechanism to protect the worker.

But you don’t need fine print to understand goals of the initiative’s sponsors. In a recent issue of the BIAW’s newsletter, executive vice president Tom McCabe wrote:

“I personally yearn for the day when the mammoth state Department of Labor and Industries is closed down, windows shuttered, with weeds growing all over its sprawling campus.”

Washington’s worker compensation system was adopted 99 years ago, at a time when the Evergreen State had a logging-mining-farming economy.

It is a no-fault, non-profit system that safeguards employers from lawsuits over job-related injuries, while providing medical insurance and partial wage compensation to injured workers.

Workers comp, like Social Security, is a contract: The public has said to workers — those who put bodies and limbs at risk — that if injured you get compensated, and you don’t have to sue.

The system has some flaws. Continue reading Seattlepi.com: I-1082 – Boon To BIAW, Bad For Workers →

Legislation

Initiative 1082: Join Us In Opposing This Sneaky Initiative

No On 1082 Bull

I-1082 is a massive power grab by the insurance industry, written by insurance industry lobbyists under the guise of workers’ compensation “reform,” to gain excessive profits at the expense of workers, small businesses, and taxpayers in our state — and it will be on the ballot this November. I-1082 was written by the insurance industry, and just like an insurance policy, its fine print is filled with hidden provisions, all at your expense.

In fact, the fine print of I-1082 gives special exemptions to workers’ compensation insurers that no other line of insurance is allowed — not car, not home, not life or health. It exempts private workers’ compensation insurance companies from almost all of the oversight and consumer protections covering every other type of insurance sold in the state. I-1082 also lets insurers set their own rates and allows them to wrongfully deny and delay legitimate claims with virtually no way to hold them accountable.

Workers’ compensation insurance is there when you and your family need it. If you’re injured on the job, workers’ compensation pays your doctor bills and provides some income until you can work again.

But I-1082 would wreak havoc on workers’ compensation here in Washington. We’ve seen what the insurance industry has done Continue reading Initiative 1082: Join Us In Opposing This Sneaky Initiative →

Legislation

Initiative 1082: The Insurance Industry’s Plan To Destroy Washington State Workers’ Compensation

No on 1082Friends:

The only way most of you would even know anything about this is if you were approached by a signature-gatherer to sign an initiative petition for something called I-1082 to get on the November ballot.  Some of you may have already signed this if it was discussed by the signature-gatherer in conjunction with another ballot initiative, such as privatization of liquor sales in Washington.  You have probably heard some of the meaningless jargon, such as “allow private insurance to ‘compete’ in the workers’ compensation system.”

But, here we are, now faced with a measure that is calculated essentially to destroy one of the best workers’ compensation systems in the country.  Sure, many of you may have had, or are still having, a contentious experience with the Department of Labor & Industries, or a self-insured employer, over a workers’ comp claim.  If there weren’t a lot of problem claims in the system, our firm wouldn’t be in the business of representing injured workers.  But compared with most other state workers’ comp systems Continue reading Initiative 1082: The Insurance Industry’s Plan To Destroy Washington State Workers’ Compensation →

Legislation

Approve Referendum 67!

Referendum 67 simply requires the insurance industry to be fair and pay legitimate claims in a reasonable and timely manner.

Please join us in voting to APPROVE Referendum 67 in November.

Dear clients and friends:

Referendum 67 is an important consumer protection measure on the November 6th ballot. If you are forced by your insurance company to file a lawsuit over a legitimate claim you’ve made, and you win, you will get paid for your claim but nothing more for the company’s wrongful delaying or denying your claim. Your own legal costs to recover against the insurer are not recovered.Referendum 67 fixes that by allowing the court to assess penalties against the insurer for that type of conduct. It therefore creates an incentive for insurance companies to treat their policy-holders fairly.Referendum 67 covers claims related to homeowner’s insurance, auto insurance, long-term care insurance, property insurance and small business insurance.

4100 complaints are made annually to the Office of the Insurance Commissioner about illegitimately denied claims, which likely means there are thousands more unreported instances of this kind of behavior by the insurance industry. Ultimately this conduct can lead to denied medical care, loss of a business, and ruined credit for policy holders. Continue reading Approve Referendum 67! →