Work Comp Chicago Illinois Workers Compensation News and Updates
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8-12-08
Mandatory Insurer Reporting (MIR): Medicare Secondary Payer Protections
A new law known as Mandatory Insurer Reporting (MIR) eff. January 1, 2008, will require insurers to report coverage information or claim information for Medicare beneficiaries to CMS for the purposes of coordination of benefits.
Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (PL 110-173) amends the Medicare Secondary Payer (MSP) provisions of the Social Security Act (Section 1862(b) of the Social Security Act; 42 U.S.C. 1395y(b)) to provide for mandatory reporting of insurance coverage for group health plans, liability insurance (including self-insurance), no-fault insurance, and workers' compensation. The new law imposes a reporting duty on carriers to report the identity of Medicare beneficiaries and coverage information to CMS for all those that are covered by "primary" plans like health insurance, or active claims under workers compensation or auto liability plans.
On 8-1-08 CMS released a Statement Summary listing Medicare mandatory reporting "data elements" listing required reporting details and the reasons behind implementing the requirements. Carriers must now notify CMS if a known Medicare recipient has a claim or coverage. Fines for noncompliance are $1,000 /day.
Compliance dates: -- January 1, 2009 information reporting for group health plans -- July 1, 2009 reporting from liability insurance, no-fault insurance, and workers' compensation.
It is expected CMS will demand to be notified of all workers compensation settlements or all liability settlements for any Medicare beneficiaries so as to enforce the Secondary Payer Regulations, Medicare lien recovery rules and credits against future payments for injury related medical expense. Reporting requirements may also include (1) Nature of Injury, (2) Cause of Injury, (3) State of Venue, (4) ICD-9 primary diagnosis codes and (5) Specific Body Part involved. See the Statement Summary above for a detailed listing of data elements.
CMS created a central web page, Mandatory Medicare Insurance Reporting, for summary information regarding the updated carrier reporting requirements, updated memos and .pdf downloads. 7-28-08
Illinois Employee Classification Act: Construction Workers, Proposed Rule Changes
The Illinois Employee Classification Act provides that individuals performing services for construction contractors on or after January 1, 2008 are presumed to be employees of the contractor unless they meet the criteria specified in the Act. If a contractor has misclassified individuals as independent contractors, the Department may assess civil penalties and seek other remedies provided for in the Act.
See link for an overview of the Act’s definitions and prohibitions.
The Act addresses a known practice in the construction industry of contractors misclassifying individuals as independent contractors in order to avoid payroll taxes, unemployment insurance contributions, workers' compensation premiums and minimum wage and overtime payments.
For the purpose of ensuring that all Illinois contractors comply with Illinois tax and employment laws, the Illinois Department of Labor, the Illinois Department of Employment Security, the Illinois Department of Revenue and the Illinois Workers' Compensation Commission will be sharing any information on employers suspected of misclassification of employees as independent contractors.
The Department of Labor issued new proposed rule changes for the act 6/26/08 in response to recent public comments and recent departmental experience. Hearings on proposed rules will be heard before the Joint Committee on Administrative Rules.
Questions regarding proposed rule changes, contact Carmela Gonzalez at 312-793-1808.
Chicago Workers Compensation Attorneys – WC-Chicago.com 7-28-08
7-27-08
Overfunding Workers Comp Medicare Set Aside Accounts with No Appeal Rights
The National Alliance for Medicare Set-Aside Professionals (NAMSAP) issued a recent letter 7/2/08 directed to CMS listing grievances in the CMS review approval process for Medicare Set-Aside Allocation (MSA) proposals. The very real concern for all parties is that these MSA approval decisions are final. There exists no appeal process from the final administrative decisions regarding MSA future medical funding. It has been stated that MSA proposal reconsideration submissions (the only current process available) have been met with resistance and/or were generally ignored.
For the sake of brevity, the short list of pressing concerns is paraphrased below:
1. INCLUDING NON- MEDICARE ITEMS OR TREATMENTS: Recent MSA approvals are routinely requiring funding for non-Medicare items or treatments which would not be covered by Medicare nor for which the workers compensation insurance carriers would be liable under the state workers' compensation laws.
2. APPLYING STANDARDIZED NATIONAL PRICING: CMS has applied their own standardized national pricing for some procedures, such as Spinal Cord Stimulators, without regard to actual price levels in the state of injury, locale of the injured worker or the relevant state Workers Compensation Fee Schedule. The result is that the national pricing is either too high or too low in funding recommendations for the MSA.
3. UPCODING OF CPT CODES for some treatments that result in higher MSA funding costs. An example was given of upcoding historically accurate 99213 office visits to 99214 office visits. It is alleged that this upcoding occurs as well on MRI's (adding in with contrast codes, instead of standard without contrast code, and x-rays (changing historical 2-3 views to 4 views). By "upcoding", the WCRC is not pricing the MSA pursuant to the amount which Medicare or the insurer would have actually otherwise paid.
4. HIGHEST ONLINE PRICING FOR MEDICAL EQUIPMENT: not using the average price at which the equipment can be purchased and the high pricing is often contrary to the relevant state WC Fee schedules. In some cases CMS required full MSA funding for all of the following: a cane, a walker, a manual wheelchair, and an electric wheelchair even though Medicare would not actually cover or pay for all those items under their own coverage guidelines for an actual Medicare Beneficiary.
5. ACCEPTANCE OF IME REPORTS only when they recommend increases for medical treatment exceeding the recommendations of the treating physician. Conversely, CMS will not accept the IME opinion reports if they recommend less treatment than that recommended by the treating physician.
6. IDENTICAL CASES NOT GIVEN THE SAME MSA FUNDING APPROVAL: Although the irregularities listed are not claimed to occur in all cases, eliminating variances would help in preparing future MSA proposal estimates for ready approval.
7. IGNORING LIMITATIONS UNDER STATE WORKERS' COMPENSATION LAW: The obligations of the WC employer or insurer for payment of injury related medical expense is defined by that particular state’s workers' compensation law, but that liability or limitations of liability of the employer under their state’s law is routinely ignored by CMS when assessing MSA proposals effectively denying the employer or insurer due process and substantive rights.
A copy of the 7/02/08 letter by the NAMSAP Board of Directors is available at the following link: NAMSAP Letter.
The hopes are that CMS will now address these consensus problems that have been increasing the overall cost of MSA approval amounts and ultimately, increasing the overall cost of Workers Compensation settlements.
In discussions with local MSA attorneys in Chicago, the unanimous complaint mentioned is the extended delay time in obtaining prior Medicare “conditional payment” amounts in order to finalize any reimbursement claims.
From our perspective, the concern remains that CMS/ MSA approval amounts do not correlate with or reflect the actual “compromise” value of the workers compensation settlement. While workers compensation claims often remain disputed in significant respects and settlement dollars usually represent real “compromise” figures pricing in the value of disputed issues, CMS continues to require 100% funding of MSA future medical accounts for anticipated treatment even where that medical treatment itself may remain disputed and/or even where the injured worker is only receiving 50% or less of the full value of the claim. The proportional disputed “compromise” values of disputed issues are not reflected in the MSA account approval amounts.
While workers compensation carriers should not be able to pawn off related future medical expense onto Medicare and the taxpayer, the employers and work comp insurance carriers should not be required to pay for more than their fair share of liability for open medical rights or expenses under the workers compensation claim any more than if that claim had remained open.
7-16-08
Illinois Workers Compensation Medical Fee Schedule proposal for Outpatient Services
The Illinois Workers' Compensation Commission Medical Fee Schedule and the payment guidelines were adopted in 2005 for a statewide comprehensive Workers Compensation Medical Fee Schedule broken down by Illinois zip codes. The maximum allowable payment for a particular medical procedure, treatment or service covered under the Workers Compensation Act is now set in a schedule based on the historical charges for locations throughout the state from 2002 to 2004, cost adjusted for inflation. Historical charges were analyzed and broken down by the 3 number geozip or 1st three numbers of a zip code, i.e., 606—for Chicago. Generally, the reimbursement rates are set at 90% of the 80th percentile of actual historical charges provided for treatment in a specific area zip code. The Illinois medical fee schedule is one of the most comprehensive fee schedules for any state workers compensation program.
The medical fee schedule rules cover all medical care rendered on or after February 1, 2006. The medical fee schedule sets forth the caps or maximum limits for payment of medical invoices based on particular medical procedure code, the date of service and the location (or zip code) where the medical care is rendered.
The amounts payable to a medical provider under the fee schedule is set out as the lesser of the Fee Schedule amount, the actual billing charge or a controlling "negotiated rate" as established by negotiated provider contract with the medical provider. An established contract between the insurance carrier or employer will control over amounts set forth in the schedule.
Inpatient Hospital charges and Physician Professional charges are listed in specific amounts in the fee schedule. Special rules apply for add-on or pass through charges for hardware, instrumentation and medical devices.
The Commission is currently working on adopting a fee schedule for hospital outpatient charges and ambulatory surgical fee charges. The proposed Illinois fee schedule rules for hospital outpatient services and ambulatory surgery charges is available in draft at this link to the Commission website. Official Public Comment hearings are currently being held on the proposed new outpatient fee schedule in both Chicago and Springfield.
Chicago Workers Compensation Attorneys – WC-Chicago.com 7-16-08
6-21-08
Chicago Illinois Workers Compensation Attorney, Attorneys
Illinois attorneys in workers compensation and work injury litigation. Experienced trial attorneys practicing before the Commission since 1984. Representing clients in Illinois workers compensation claims and work related injury litigation in construction, manufacturing, trucking and transportation work injury litigation.
Chicago workers compensation attorneys with advanced training and trial experience. Our attorneys maintain a significant competitive edge in Illinois work injury litigation. We offer representation and assistance in accident litigation for Chicago and surrounding cities in Northeastern Illinois including:
Chicago, Waukegan, Barrington, Lake Zurich, McHenry, Woodstock, Geneva, St. Charles, Wheaton, Downers Grove, Naperville, Aurora, Romeoville, Joliet, Bourbonnais and Kankakee.
Cook County, Lake County, McHenry County, Kane County, Will County and Kankakee County.
Chicago Workers Compensation Attorneys -- WC-Chicago.com 6-21-08
6-15-08
Illinois Trucking Company sues Ohio Employer ADT in 3rd Party claim in ladder accident
Palmer v. Freightliner (1st Dist., June 2008) Ohio employer, ADT was stuck with a 3rd party claim for contribution for negligence even though Ohio law prohibits 3rd party contribution actions in personal injury cases for claims against an employer where the employer provides workers compensation insurance coverage.
An Ohio security & alarm system installer, Palmer, employee for ADT was working on a 20 ft ladder leaning against a loading dock garage door at Freightliner’s Wood Dale, Illinois facility when a Freightliner employee opened the garage door. The ladder fell and Palmer crashed to the ground.
Illinois law allows an employer to be immune from direct suit by an injured employee but not free from suit brought by a primary defendant in a claim for contribution for partially causing the injury. In Ohio, an employer who complies with providing workers compensation insurance is immune from negligence suits in employee personal injury cases.
In an excellent analysis and application of the Restatement 2d of Conflicts of Law and prior Illinois Supreme Court law, the Palmer decision held the Ohio employer could be sued for contribution for their share of negligence.
The general rule (per Section 146 of the Restatement of Conflicts) is that the local laws of the state where the injury occurred will determine the rights and liabilities of the parties in a personal injury action unless some other state “has a more significant relationship.”
Despite the fact that Palmer was an Ohio resident, an Ohio employee and paid Ohio workers compensation benefits, including a $7,500 settlement, Illinois had the “most significant relationship.” The court examined (1) place where injury occurred, (2) place where conduct causing injury occurred, (3) residence and domicile of all parties & place of business and (4) where the “relationship” of the parties was centered.
Illinois applies the principles of comparative fault to all parties in a personal injury accident. Freightliner was allowed to pursue a claim of some portion of blame on the Ohio employer, ADT.
Chicago Workers Compensation Attorneys -- WC-Chicago.com 6-15-08
6-7-08
Illinois Workers Compensation- Medicare Coordination Update
The Centers for Medicare & Medicaid Services (CMS) have consolidated all work related Medicare Secondary Payer (MSP) payment recovery for Auto, Workers Comp & Group Health plans into one Payment Recovery Center. The location provides payout information on conditional payments and coordinates recoveries. For specific Workers Compensation recovery coordination contact:
MSPRC WC
PO Box 33831
Detroit, MI 48232-5831
For Pay out and Recovery information Contact:
tel: (866) 677-7220 or (866) 677-7294 (TTY/TDD)
fax: (734) 957-0998
MSPRC website The real news here is that this new web site gives you explanations on all those form letters that MSPRC sends out.
Chicago Workers Compensation Attorneys --WC-Chicago.com 6-07-08
6-7-08
Employer Assignment of Work Comp Lien-- must pay 25% Attorneys Fees
Normally an Illinois employer that pays workers compensation benefits is entitled to seek repayment of all amounts paid in any 3rd party personal injury action brought by the worker against a responsible 3rd party. In construction injury cases, that responsible 3rd party is often the general contractor or another contractor on the job site that are blamed for causing the workers’ injury.
In any lien reimbursement action where the employer seeks repayment from the proceeds of the personal injury law suit, Illinois law requires the employer to pay the injured workers attorney 25% of any recovery or reimbursement. Therefore Illinois employers usually only obtain 75% reimbursement of amounts paid in workers compensation benefits. Meanwhile, the primary defendants will get to set off 100% of the workers compensation payments as a credit or set-off in any award against them to prevent a double recovery by the injured worker.
Where the employer was also negligent or partially responsible for causing the injury, a law suit for contribution is usually brought by the main defendants against the employer. To the extent that an employer is partially responsible for the workers’ injuries, the right to reimbursement will be reduced by the amount or % of negligence of the employer.
Section 5(b) of the Illinois Workers Compensation Act states:
“Out of any reimbursement received... the employer shall pay his pro rata share of costs… and expenses… and where the services of an attorney… of the employee… substantially contributed to procurement… of the proceeds out of which the employer is reimbursed, then, … the employer shall pay such attorney 25% of the gross… reimbursement.” 820 ILCS 305/5(b) (West 2006)
In a recent case, Evans v Doherty(1st Dist, April 2008) the employer in a construction injury setting attempted to shirk payment of attorneys fees by giving an “assignment” of the employer's workers compensation lien to the primary defendants. The employer had paid out $152,000 in workers compensation benefits and sold their right to reimbursement to Doherty and other primary defendants for the sum of $90,000. The employer in an argument too cute for the court said they received no reimbursement of their workers compensation lien but merely sold their rights to repayment in an assignment of lien. The Court said it was a distinction without a difference and ordered the employer to pay the 25% attorneys fees on the $90,000 they received.
Chicago Workers Compensation Attorneys --WC-Chicago.com 6-07-08
5-11-08
Illinois Borrowing Employer of Temporary Laborer; Exclusive Remedy
Chavez v. Transload, (1st Dist, March 2008 ) again reaffirms that a borrowing employer in Illinois enjoys immunity from negligence suit. A temporary laborer employed by a temporary agency was loaned to a company that unloaded and stored steel for customers. Temporary worker, Chavez, was hit by an overhead crane while off loading a rail car and sued for premises liability and negligence. The Court dismissed the case under Section 5(a) the "exclusive remedy " provisions of the Illinois Workers Compensation Act barring negligence suits against an employer for line of duty job injuries.
The most important among several factors in finding a "borrowed employment" relationship are (1) the borrowing employer's right to control the work performed and, (2) whether the employee gave an express or implied consent to a borrowed employment relationship.
Here, the right to discharge, the right to set the work schedule, the right to control the work and the worker's consent to the job assignment, all lead to dismissal of the negligence suit. Note, the exclusive remedy rule may not apply where there is a joint venture between the companies instead of a borrowed employment relationship. That issue is currently pending before the Illinois Supreme Court.
Chicago Workers Compensation Attorneys --WC-Chicago.com 5-11-08
5-05-08
Illinois Construction Workers Employee Classification Act
Effective January 1, 2008, new laws apply to the Construction industry to guarantee the proper classification of Construction Workers. Individuals performing services for construction contractors on or after January 1, 2008 are presumed to be employees of the contractor unless they meet the criteria specified in Section 10 of the Act. If a contractor misclassified individuals as independent contractors, the Department may assess civil penalties and seek other remedies. The Department must notify the Department of Employment Security, the Department of Revenue and the Workers’ Compensation Commission who are then required to check such contractor’s compliance with their respective laws. http://www.state.il.us/agency/idol/laws/Law185.htm
Employee Classification Information Contact #: (217) 782-1710
Chicago Workers Compensation Attorneys --WC-Chicago.com 5-05-08
4-29-08
Illinois Workers Comp Injury Rates Fall 53% 1991 to 2003
The Illinois Workers Compensation Commission tracks injury rates for Illinois employers and provides break downs of injuries by specific body parts involved. Back injuries are fairly common in most occupations and represent a high cost for both injured workers in future lost earnings and Illinois employers in workers compensation claim payments.
Illinois employers and workers have proved to have an increased safety record. According to the Illinois Workers Compensation Commission, the overall worker-injury rate in Illinois decreased by 53% between 1991 and 2003. The most recent Illinois Workers’ Compensation report shows the number of cases filed have dropped 20% from fiscal year 2001 of 71,038 claims filed statewide to fiscal year 2006 of 56,911 claims filed. Illinois now maintains the 10th lowest injury rate in the country.
Among the 50 states and the District of Columbia, Illinois is ranked:
10th lowest in w.c. injury rate;
25th lowest in w.c. benefit cost rates (w.c. benefits divided by payroll);
26th lowest in w.c. medical costs per claim;
30th lowest in w.c. insurance premium rates;
30th lowest in w.c. indemnity costs per claim