The Path Of Totality
Jun 21, 2017


On the longest day of the year, Illinois lawmakers are back in Springfield to begin a special 10-day session of the General Assembly. Governor Bruce Rauner called state legislators back to the Capitol to hammer out a budget deal and prevent the state's budget gap from entering an unprecedented third year. The Illinois fiscal year is set to begin on July 1, 2017. In addition, the path forward for workers' compensation in the Land of Lincoln is very much on the special session agenda.





In the final days of the Illinois General Assembly's Spring Session, the House and Senate passed two workers' compensation measures - House Bill 2525 and House Bill 2622. House Bill 2525 would grant the Director of the Illinois Department of Insurance broad authority to approve rate filings and would establish a Workers' Compensation Premium Rates Task Force. House Bill 2622 would create the Illinois Employers Mutual Insurance Company as an independent, non-profit, public corporation to issue insurance for Workers' Compensation and occupational disease. The company would be backed by an initial loan of $10,000,000 from the state that is repayable within 5 years. Several major insurance and industry associations have opposed these bills and urged the Governor's veto.



This week, the Illinois GOP countered with a proposal, known as the "Capitol Compromise," to address workers' compensation reform within the larger context of the Illinois budget stalemate. GOP lawmakers outlined several new workers' compensation proposals to improve the business climate but would not adversely affect workers' benefits. Three of the leading proposals would align the medical fee schedule closer to the national average, increase the TTD waiting period from 3 to 5 days, and develop a closed drug formulary to reduce over-prescription and overcharging of pharmaceuticals.



In addition, the GOP proposal includes language that was previously negotiated by both parties. The plan would impose penalties on employers/insurers for delays in authorizing medical treatment. It would also table the discussion of causation or intervening cause and would not roll back benefit increases or attorney's fees passed in 2005. We'll be holding on to this developing story over the next week and a half.

Medical Malpractice


The Florida Supreme Court struck down the state's cap on pain and suffering damages in medical malpractice cases, ruling that such limits are unconstitutional. In a 4-3 ruling, the Florida high court found that limits passed in 2003 on non-economic damages violated equal protection rights under the state constitution. The ruling paves the way for malpractice claimants to seek unlimited damages in Florida.



The Florida ruling echoed in Washington, D.C., particularly among lawmakers who were scheduled to debate H.R. 1215, "Protecting Access to Care Act of 2017." This federal legislation would impose a $250,000 cap on non-economic damages in cases of medical negligence, unsafe drugs, and nursing home abuse nationwide. This week, H.R. 1215 drew objection from a number of patients' groups and support from the Trump administration. The White House cited the rising cost of healthcare and a rising concern that medical liability rules allowing for unlimited non-economic damages encourage providers to practice defensive medicine. We're following this tort reform issue closely.

Making Our Way Around the Country


The United States Department of Labor (DOL) awarded more than $11.4 million in grants to eight states to improve workplace safety. Alabama, Indiana, Iowa, Kentucky, Massachusetts, and Missouri will each receive $1 million in grants to improve state workforce longitudinal administrative databases, aimed at evaluating the effectiveness of workforce and education programs. The DOL awarded two $2.7 million grants to Mississippi and Rhode Island to improve case management and reporting systems. In a further move to support state-based labor programs, President Trump signed an executive order (EO) that will cut back the federal government's role in creating or monitoring apprenticeship programs, a move the White House hopes will create jobs in states across the country. The EO contains more than $200 million in incentives for third parties to create, measure, and report state-based apprenticeships.



The bi-partisan Presidential Commission on Combatting Drug Addiction and the Opioid Epidemic, led by New Jersey Governor Chris Christie, convened this week. Several vocal Democratic members of the Commission expressed significant concern that GOP efforts to repeal and replace the Affordable Care Act will make the nation's opioid crisis worse. Commission members argued that state Medicaid programs serve as the largest provider of coverage for people with addiction in this country. Taking a different tact, a majority of state attorneys general this week joined forces to investigate the manufacturing, marketing, and proliferation of opioid drugs in the United States today.



The Texas Division of Workers' Compensation (DWC) released an informal draft rule amending the state's closed formulary. The amended definition would exclude any compounded medication from the closed formulary. Medications excluded from the Texas Closed Formulary can only be prescribed following a prior authorization process establishing medical necessity. Previously, only compounded medications with an "N" ingredient, as identified in the Official Disability Guidelines (ODG), were excluded from the closed formulary. The DWC invites public comments on the proposed informal draft before July 7, 2017.



The DWC recently reviewed form letters it sends to injured employees and modified the correspondence with recognized plain language principles, making them easier to read. The form letters will contain shorter words and sentences, clearer headings, and less jargon. The DWC completed eight letters and notices thus far that will be available for circulation this month.



This afternoon marks the official start of summer in the Northern Hemisphere. And, as we eagerly await this summer's solar eclipse and its resulting path of totality, we're keeping a watchful eye on seasonal safety issues. So, whether your summer plans involve taking a dip in the pool, or boating on our waterways, or hiking among the trees, please keep safety in mind. Your friends at The Way wish you a safe and enjoyable summer.

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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