Comings & Goings
Jan 11, 2017


A look at the folks transitioning in federal and state appointments as the transition of power continues.








The Senate holds confirmation hearing this week to vote on some of President-elect Donald Trump's cabinet picks. Elaine Chao, nominated for transportation secretary, is among those scheduled to appear before the Senate this week. Ms. Chao has previously served as secretary of labor (under Bush 43) and as deputy secretary of DOT (under Bush 41). Rex Tillerson, nominated for secretary of state, is also scheduled to appear before the Senate Foreign Relations Committee. Tillerson has served as the CEO of ExxonMobil since 2006. Senator Jeff Sessions had the first hearing on Tuesday. Nominated for Attorney General, he appeared before the Senate Judiciary Committee.



Michael McRaith, the director of the Treasury Department's Federal Insurance Office (FIO), announced he will step down from his post on Jan. 20, 2017. The FIO was created in the 2010 Dodd-Frank Act and Mr. McRaith has served as the director since it began 2011. FIO has authority to monitor insurance markets and insurance regulation. No word yet on who will replace McRaith. President-elect Trump nominated Steven T. Mnuchin as the next Treasury Secretary.



Yolanda Stith was appointed to the North Carolina Industrial Commission last month. The Industrial Commission settles workers' compensation claims and demands for compensation when people claim they were harmed by state actions. Stith headed a trade association, was a lobbyist, and previously worked as an insurance underwriter.



We're still awaiting the Senate hearings of Betsy DeVos, Education Secretary, Rep. Tom Price, Secretary of Health and Human Services, and Steven Mnuchin, Treasury Secretary. We'll keep watching the latest developments as the transition continues.

Medicare Conditional Payments


A federal judge ruled that the Centers for Medicare and Medicaid Services (CMS) is only entitled to seek reimbursement for medical items and services related to a workers' compensation claim. In the case, CMS demanded reimbursement for several claimants' medical bills that included charges not covered by the workers' compensation policy.



The Medicare Secondary Payer Act (MSP Act) allows CMS to recover the cost of treating beneficiaries when another form of insurance is primary, such as workers' compensation insurance. However, the MSP Act was not designed to shift uncovered and unrelated cost back to the primary plan. CMS admitted that if at least one diagnosis code was for a condition covered by the work comp plan then it would seek full reimbursement for the amount billed. The court ruled this was not allowed under the MSP Act.

Making Our Way Around The Country


The Illinois House approved legislation on Monday that would make it unlawful for workers' compensation insurers to earn excessive profits and require carriers to submit their rates to the Department of Insurance for prior approval. Among the new rate regulation, House Amendment 4 (HA 4) to SB 2901 also defines "traveling employee" and "arising out of the employment", provided penalties for delay and authorization of medical care, and required annual reports by the Workers' Compensation Commission concerning the state of self-insurance for workers' compensation in Illinois. However, this legislation died with the end of the 99th General Assembly on Tuesday.



The Pennsylvania Supreme Court dismissed an appeal from the Commonwealth Court's decision, thereby upholding the Commonwealth Court's ruling that the franchisor, Saladworks, is not liable to its franchisee's employees for workers' compensation claims. In this case, the PA Workers' Compensation Appeal Board found that Saladworks was a statutory employer when the franchisee did not have proper workers' compensation coverage. However, the Commonwealth Court found Saladworks does not meet the statutory definition of employer nor the cases interpreting it.



RIMS, the Risk Management Society, announced that Nowell R. Seaman will lead the Society as president for the 2017 term, effective January 1. Mr. Seaman is the Director of Global Risk Management for Potash Corporation of Saskatchewan Inc. This year's RIMS 2017 Annual Conference & Exhibition will be held in Philadelphia, PA on April 23-26.



President Obama delivered his Farewell Address in his hometown of Chicago. In case you missed it, you can find it here.

About The Way

The Way is Gallagher Bassett's weekly governmental briefing on state and federal affairs that affect our industry. We thank you for starting your Wednesday morning with us. Please be sure to follow #GBTheWay for additional news and updates as we make our way throughout the country on the issues affecting our industry. For more information, please connect with GB on LinkedIn, follow us on Twitter, or contact the authors, Greg McKenna or Cari Miller, directly.


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