Workers comp bill goes before Senate today

Journal Record, The (Oklahoma City), Oct 4, 2001 by Marie Price The Journal Record

A workers compensation reform bill that would also allow close to 2,000 injured workers to continue to receive benefit payments ended the day Wednesday without action in either house.

Earlier in the day, plans were to bring up House Bill 1003X in the Senate, then ship it over to the House for what supporters hoped would be an easy, quick passage through the House. However, the measure, supported by Republican Gov. Frank Keating and The State Chamber, among others, ran into trouble with legislative Republicans. This was especially true in the House, where GOP lawmakers spent much of the day in caucus.

The bill is scheduled to be taken up by the Senate this morning.

Any savings resulting from the measure may not come from actual rate reductions, officials say, but from overall decreases in system costs.

However, Rep. Jari Askins, D-Duncan, key House negotiator, said that the National Council on Compensation Insurance is required to review workers compensation legislation for its impact on costs, and if warranted to file for adjustments in the loss cost component of workers comp rates.

The bill restricts or eliminates some workers compensation benefits and revises the procedure for funding the financially strapped Multiple Injury Trust Fund.

Its two-pronged approach accomplishes the coupling of reform and rejuvenating the trust fund that Keating wants.

Currently, the fund is made up of a 2 percent assessment on workers compensation premiums, 4 percent on self-insured groups. However, this mechanism has produced only about half of the originally estimated $15.2 million. It comes nowhere near meeting the trust fund's needs, which total more than $40 million if various loan paybacks are included.

If funding is not provided within a few weeks, close to 2,000 workers who have suffered more than one on-the-job injury will not receive their benefit checks for the second time this year.

Askins said she does not know whether officials with the fund intend to seek another loan from CompSource Oklahoma to tide the fund over until the new funding system kicks in.

However, Multiple Injury Trust Fund officials said they will require some type of gap funding.

Richard Cole, special counsel, said that the fund pays out about $300,000 each week in benefits. Currently, he said, the trust fund can cover its benefit needs only through Oct. 12.

Benefits for almost 2,000 injured workers were delayed in June, when the fund ran out of money. A loan from CompSource Oklahoma helped meet fund obligations, and it was able to operate through the end of September.

The trust fund would need close to $41.2 million for the fund to meet all of its needs, including paying back previous loans.

It has about $21.9 million in ongoing annual expenses -- $17.5 million for awards, $3.3 million for loan repayments and $1.1 million in other needs, not including an estimated $28 million in compound interest on the outcome of a lawsuit involving unpaid claims.

Under the bill, premium assessments would be capped at 6 percent, assessments of uninsured employers at 5 percent of awards paid by them during each calendar-year quarter. Below those amounts, assessments would be set at an amount needed to pay the fund's obligations each year. Of the amount collected, $1.7 million would be split among the State Department of Labor ($850,000), the Workers Compensation Fraud Unit of the Office of the Attorney General and the Department of Career and Technology Education ($425,000 each).

House Bill 1003X's workers compensation reform provisions would:

* Do away with benefits for injured workers who test positive for alcohol, illegal drugs or misused prescription drugs unless the employee can prove that the substance abuse did not cause the injury. It also provides for post-accident testing.

* Authorize the Workers Compensation Court, on its own motion or at the request of any party, to set settlement conferences.

* Allow employers to select the treating physician for a claimant.

* Return the medical fee schedule to its 2000 level.

* Provide for medical case management for cases not covered by workplace medical plans, a form of managed care.

* Prohibit independent medical examiners from treating a claimant unless both parties agree.

* Require an employee covered by a certified workplace medical plan to exhaust its dispute resolution process before asking the court to order a change of physician.

* Establish criteria for some permanent partial disability awards: except in cases involving corrective surgery, no permanent disability in excess of 7 percent to each body part injured, except for psychological overlay, absent objective evidence of permanent anatomical abnormality or adverse impact on an employee's ability to earn wages.

* Increase compensation schedule for permanent partial disability by a total of 10 percent -- 5 percent in 2002 and 5 percent in 2003.

Askins said that the latter has not been increased in more than 20 years.

House Speaker Larry Adair, D-Stilwell, said that the House will take up the bill today, if it is not amended in the Senate.