Richard's 9/23/2011 Presentation to McHenry County Bar Association

§8.1b: AMA Guides

Section 8.1b. Determination of permanent partial disability.

For accidental injuries that occur on or after September 1, 2011, permanent partial disability shall be established using the following criteria:

•(a) A physician licensed to practice medicine in all of its branches preparing a permanent partial disability impairment report shall report the level of impairment in writing. The report shall include an evaluation of medically defined and professionally appropriate measurements of impairment that include, but are not limited to: loss of range of motion; loss of strength; measured atrophy of tissue mass consistent with the injury; and any other measurements that establish the nature and extent of the impairment. The most current edition of the American Medical Association's "Guides to the Evaluation of Permanent Impairment" shall be used by the physician in determining the level of impairment.

•(b) In determining the level of permanent partial disability, the Commission shall base its determination on the following factors:

•(i) the reported level of impairment pursuant to subsection (a);

•(ii) the occupation of the injured employee;

•(iii) the age of the employee at the time of the injury;

•(iv) the employee's future earning capacity; and

•(v) evidence of disability corroborated by the treating medical records. No single enumerated factor shall be the sole determinant of disability. In determining the level of disability, the relevance and weight of any factors used in addition to the level of impairment as reported by the physician must be explained in a written order. (Source: P.A. 97-18, eff. 6-28/11.)

On page 6 of "Guides to the Evaluation of Permanent Impairment, Sixth Edition" it states "The Guide is not intended to be used for direct estimates of work participation restrictions. Impairment percentage is derived according to the Guides criteria. Do not directly measure work participation restrictions. The intent of the Guides is to develop standardized impairment ratings." "In disability evaluation, the impairment rating is one of several determinants of disablement. Impairment rating is the determinant most amenable to physician assessment; it must be further integrated with the contextual information typically provided by non‑physician sources regarding psychological, social, vocational and advocational issues."

An easy example as given in the Guides is the amputation of a toe. The impairment is 100% loss of that toe. While there may be no disability for an attorney who loses the toe, certainly there would be a tremendous amount of disability if the individual who lost the toe were a ballerina.

There is nothing in Section 8.1(b) that indicates a permanent partial disability impairment report must be issued by a physician. However it does state that a physician who is preparing a permanent partial disability impairment report shall include the level of impairment in writing. If for example you were to use an AMA guideline report for an operated knee which involved only the meniscus you will note that the disability for the leg would range from 1-4% loss of use of the leg, 2 would be the midrange and 4 would be the most severe.

The inserted material involves AMA guidelines as it pertains to surgical repair of the medial meniscus with uncomplicated recovery. Midrange for impairment is 2% loss of use of the leg. That is the assumed value. If there are no clinical findings it can be zero and if it is severe it can be 4% loss of use of the leg. (See Knee: Medial Meniscal Tear example).

It should be understood that the final amendment to the Workers' Compensation Act added language that was not in the prior drafts from Speaker Madigan's office. The prior draft simply limited disability to the AMA guidelines. The draft that passed added in determining the level of permanent partial disability the Commission shall base its determination on the following factors: (1) being the level of impairment pursuant to AMA guidelines, (2) the occupation of the injured employee, (3) the age of the employee at the time of the injury and (4) the employee's future earning capacity, and (5) evidence of disability corroborated by the treating medical records. It should also be noted that if the first draft passed there would be no need to even offer medical records into evidence. What the petitioner noticed about himself would not be relevant. In order to add more force and effect to the other four categories in determining disability, the legislature indicated that in determining the level of disability the relevance and weight of any factors used in addition to the level of impairment as reported by the physician must be explained in a written Order. Preceding that part of the amended Act it also states, "No single enumerated factor shall be the sole determinant of disability." Yet it would appear that the legislature wanted to make the Guide a more important factor because if it wasn't used the arbitrator and Commission must explain in a written Order why it wasn't.

It will be up to the petitioner's attorney and the employer's attorney to do their lawyering best to either maximize or minimize the potential for exposure on permanent partial disability. In doing so there is no problem with any petitioner's attorney relying upon Section 19(e) whose final paragraph concludes that decisions of the Commission shall be regarded as precedent by arbitrators for the purpose of achieving a more uniform administration of this Act. It would be then behoove the petitioner's attorney to research prior Commission decisions in determining what was awarded for loss of use of a leg, back, arm, foot, hand as the case may be.

The next largest impact upon the injured worker can, will, or may be the implementation of Section 8.1(a) which involves the Preferred Provider Program.

§Section 8.1a: Preferred Provider Program

Section 8.1a. Preferred provider programs. Starting on the effective date of this amendatory Act of the 97th General Assembly, to satisfy its liabilities under this Act for the provision of medical treatment to injured employees, an employer may utilize a preferred provider program approved by the Illinois Department of Insurance as in compliance with Sections 370k, 370l, 370m, and 370p of Article XX-1/2 of the Illinois Insurance Code. For the purposes of compliance with these Sections, the employee shall be considered the "beneficiary" and the employer shall be considered the "insured". Employers and insurers contracting directly with providers or utilizing multiple preferred provider programs to implement a preferred provider program providing workers' compensation benefits shall be subject to the above requirements of Article XX-1/2 applicable to administrators with regard to such program, with the exception of Section 370l of the Illinois Insurance Code.

•(a) In addition to the above requirements of Article XX-1/2 of the Illinois Insurance Code, all preferred provider programs under this Section shall meet the following requirements:

•(1) The provider network shall include an adequate number of occupational and non-occupational providers.

•(2) The provider network shall include an adequate number and type of physicians or other providers to treat common injuries experienced by injured workers in the geographic area where the employees reside.

•(3) Medical treatment for injuries shall be readily available at reasonable times to all employees. To the extent feasible, all medical treatment for injuries shall be readily accessible to all employees.

•(4) Physician compensation shall not be structured in order to achieve the goal of inappropriately reducing, delaying, or denying medical treatment or restricting access to medical treatment.

•(5) Before entering into any agreement under this Section, a program shall establish terms and conditions that must be met by noninstitutional providers wishing to enter into an agreement with the program. These terms and conditions may not discriminate unreasonably against or among noninstitutional providers wishing to enter into an agreement with the program. These terms and conditions may not discriminate unreasonably against or among noninstitutional providers. Neither difference in prices among noninstitutional providers produced by a process of individual negotiation nor price differences among other noninstitutional providers in different geographical areas or different specialties constitutes unreasonable discrimination.

•(b) The administrator of any preferred provider program under this Act that uses economic evaluation shall file with the Director of Insurance a description of any policies and procedures related to economic evaluation utilized by the program. The filing shall describe how these policies and procedures are used in utilization review, peer review, incentive and penalty programs, and in provider retention and termination decisions. The Director of Insurance may deny approval of any preferred provider program that uses any policy or procedure of economic evaluation to inappropriately reduce, delay or deny medical treatment, or to restrict access to medical treatment. Evaluation of providers based upon objective medial quality and patient outcome measurements, appropriate use of best clinical practices and evidence based on medicine, and use of health information technology shall be permitted. If approved, the employer shall provide a copy of the filing to all participating providers.

•(1) The director of the Department of insurance shall make each administrator's filing available to the public upon request. The Director of the Department of Insurance may not publicly disclose any information submitted pursuant to this Section that is determined by the Director of the Department of Insurance to be confidential, proprietary, or trade secret information pursuant to State or federal law.

•(2) For the purposes of this subsection (b), "economic evaluation" shall mean any evaluation of a particular physician, provider, medical group, or individual practice association based in whole or in part on the economic costs or utilization of services associated with medical care provided or authorized by the physician, provider, medical group, or individual practice association. Economic evaluation shall not include negotiated rates with a provider.

•(c) Except for the provisions of subsection (a)(4) of Section 8 and for injuries occurring on or after the effective date of this amendatory Act of the 97th General Assembly, an employee of an employer utilizing a preferred provider program shall only be allowed to select a participating network provider from the network. An employer shall be responsible for:

•(i) all first aid and emergency treatment;

•(ii) all medical, surgical, and hospital services provided by the participating network provider initially selected by the employee or by any other participating network provider recommended by the initial participating network provider or any subsequent participating network provider in the chain of referrals from the initial participating network provider; and

•(iii) all medical, surgical and hospital services provided by the participating network provider subsequently chosen by the employee or by any other participating network provider recommended by the subsequent participating network provider or any subsequent participating network provider in the chain of referrals from the second participating network provider. An employer shall not be liable for services determined by the Commission not to be compensable. An employer shall not be liable for medical services provided by a non-authorize provider when proper notice is provided to the injured worker.

•(1) When the injured employee notifies the employer of the injury or files a claim for workers' compensation with the employer, the employer shall notify the employee of his or her right to be treated by a physician of his or her choice from the preferred provider network established pursuant to this Section, and the method by which the list of participating network providers may be accessed by the employee, except as provided in subsection (a)(4) of Section 8.

•(2) Consistent with Article XX-1/2 of the Illinois Insurance Code, treatment by a specialist who is not a member of the preferred provider network shall be permitted on a case-by-case basis if the medical provider does not contain a physician who can provide the approved treatment, and if the employee has complied with any pre-authorization requirements of the preferred provider network. Consent for the employee to visit an out-of-network provider may not be unreasonably withheld. When a non-network provider is authorized pursuant to this subparagraph (2), the non-network provider shall not hold an employee liable for costs except as provided in subsection (e) of Section 8.2.

•(3) The Director shall not approve, and may withdraw prior approval of, a preferred provider program that fails to provide an injured employee with sufficient access to necessary treating physicians, surgeons, and specialists.

•(d) Except as provided in subsection (a)(4) of Section 8, upon a finding by the Commission that the care being rendered by the employee's second choice of provider within the employer's network is improper or inadequate, the employee may then choose a provider outside of the network at the employer's expense. The Commission shall issue a decision on any petition filed pursuant to this Section within 5 working days.

•(e) The Director of the Department of Insurance may promulgate such rules as are necessary to carry out the provisions of this Section relating to approval and regulation of preferred provider programs. (Source: P.A.97-18, eff. 6-28-11.)

The Preferred Provider Program allows an employer to opt in to a network of medical providers. This network of medical providers must be approved by the Illinois Department of Insurance. Then the employer must follow certain procedures. This would include providing the injured employee with a form outlining his right to be treated by a physician of his or her own choice from the preferred provider network. If the employee declines he must decline in writing. Should he accept then the medical provider within that network shall be considered the employee's first choice of physician. Referrals within the network will not count as a choice however it should be noted that they will not be able to jump from doctor to doctor within the network without the appropriate referral. Should the employee decline, and he must decline in writing, he may then choose any physician outside the network. However by declining that will be considered one choice and in effect he will be relinquishing both choices. Should the employer not engage a Preferred Provider Program then the injured worker still has the two free choices under Section 8(a).

It is my belief that this will have an impact on the injured worker's ability to get appropriate care. It has been my experience in occupational medicine settings that they are sometimes reluctant to prescribe the MRI or even X‑rays when it is clear to even the petitioner's attorney that there may be a tear in the knee or the shoulder. They prescribe the therapy and give a release to return to work advising the injured worker that he should work through the pain or, on occasion, that the pain simply is in his head. Then by the time the injured worker gets to an attorney he may have already seen a chiropractor or non‑cooperating family doctor. He must then work those individuals into a referral system because he will have used up all of his choices by the time he got to the attorney. If he hasn't used up his choices then it is up to the attorney to attempt to guide his care. That will be difficult if, in fact, the occupational doctors are saying there is nothing wrong, the adjuster simply will not authorize a visit with the second choice and the second choice physician will not see the injured worker without the authorization.

KNEE-JERK REACTION TO MENARDS PRISON

Some of you may be aware of the perfect storm that gathered around the Illinois Workers' Compensation Commission from August of 2010 through May of 2011. Down in Marion, Illinois there is Menards prison. The Belleville Democrat did a Freedom of Information Act on Illinois Workers' Compensation Commission asking for all of the emails of various arbitrators in Southern Illinois. Further they did a Freedom of Information Act on the State of Illinois CMS looking to determine how much money had been paid to injured workers at Menards prison. It was determined that over $10 million had been paid to the employees at Menards. This is state money. The majority of those claims were carpal tunnel claims and involved the same adjuster, and at one point in time same attorney general, and most of the time the same petitioner's attorney. When comparing this to other prisons it didn't come close to the same quantity of injuries. They had almost 50 percent of their workforce involved in workers' compensation claims at one point or another. Yet baggage handlers only have a 5.6 percent rate of injury. As the Belleville Democrat, and then later the St. Louis Dispatch, dribbled out fact after fact after fact, week after week after week the governor felt bound and determined to stem the tide regarding these predominantly carpal tunnel claims. Section 8(e)(9) deals with loss of use of a hand and the amended portion of the Act states "190 weeks if the accidental injury occurs on or after the effective date of this amendatory act of the 97th General Assembly and if the accidental injury involves carpal tunnel syndrome due to repetitive or cumulative trauma in which case the permanent partial disability shall not exceed 15% loss of use of the hand, except for cause shown by clear and convincing evidence and in which case the Award shall not exceed 30% loss of use of the hand."

Preceding the amendment is the paragraph that states a hand is worth "250 weeks if the accidental injury occurs on or after February 1, 2006." Some would argue that a hand injury that involves repetitive trauma can only get up to 15% of 190 weeks unless by clear and convincing evidence they prove that there is 30% loss of use of the hand and then it would be 30% of 190 weeks. Others would argue that a hand in all other instances is worth 205 weeks. I believe the appellate court will resolve that disparity.

Section 8(d)(1) was amended and designed to limit the amount an individual may receive for a wage loss differential. It indicates that wage loss differentials shall be payable until the injured worker is 67 years of age or five years from the date of the final Award whichever is longer. In the event your client is receiving a wage loss differential prior to the trial of the case it would behoove your client to delay the trial as long as possible. Further, if you do try the case and an Award is entered then you must determine whether or not it is in your client's best interests to file a review on another issue so that the payments go on at least another year. If you are defending these cases and your injured worker is 62 years of age or older, then you want to try these cases as soon as possible.

UTILIZATION REVIEW

Section 8.7 deals with utilization review. When an employer invokes the utilization review process the treater is required to submit to the review and to make reasonable efforts to provide timely and complete reports of clinical information needed to support a request for treatment. Should the treater fail to do so, their bill for services need not be paid. The demands for participation in the utilization review require reasonableness and they must not be unduly burdensome. Utilization review may only be used for purposes of treatment and may not deal with causal connection.

During the veto session in January of 2011 the legislature wanted to make utilization review conclusive and a report admissible over a hearsay objection. That bill was never called to a vote. The final bill that came out of Springfield and was signed by the governor is a bit confusing as to how utilization review evidence is to be presented to the Commission. The utilization review must be peer to peer and the medical professional responsible for the review must be available in person or for deposition by telephone, video conference or other remote electronic means. The interview or deposition shall be conducted in a fair, open and cost-effective manner and the employer must bear the cost of the interview or deposition. Exhibits and other evidence that is going to be given to the deponent must be provided to the officer administering the oath (court reporter) and all other parties within a reasonable time before the deposition. Once the utilization review is entered into evidence either by way of report or testimony the Commission then will consider that as it will any other evidence and will address it in their decision.

The Illinois Workers' Compensation Commission is working on amendments to the Rules Governing Practice Before the Illinois Workers' Compensation Commission and will try to remove the ambiguity from this amended portion of the Act.

Section 11 of the Act codifies intoxication as a defense. The case law previously stated that the employer basically had to prove that the intoxication was so severe that the injured worker had no idea what he was doing. Now under the new Act the presumption changes and the employee will not be entitled to compensation if the intoxication was the proximate cause of the accidental injury, or he was so intoxicated when the injury occurred that it constituted a departure from the employment. If the employee refuses to submit to testing, whether it be blood, breath or urine there is a rebuttable presumption that the employee was intoxicated and the intoxication was the proximate cause of the injury. The Act then goes on to state what tests are admissible and how that evidence is preserved.

ARBITRATORS

Most of us know that when the governor signed the Act on June 28, 2011 it called for the termination of all arbitrators on July 1, 2011. However each arbitrator will remain until they are replaced. The Illinois Workers' Compensation Commission placed on its web site a help wanted ad and the response was tremendous. Applicants were screened and then interviewed by the Advisory Board and the governor's office. Every arbitrator was required to re‑submit an application for employment with the governor's office and every arbitrator was interviewed by both the Illinois Workers' Compensation Advisory Board as well the governor's office.

We will know very soon how many arbitrators will be terminated and who their replacements are. Then the chairman will have the task of realigning arbitrators in Chicago and downstate. It certainly is a job that I would not want.

The new Act requires that arbitrators outside of Chicago be assigned cases but that they not deal with any particular file and any particular geographic location for more than two years. The Act necessitated the redistribution of files and the elimination and creation of different venues. Chairman Weisz created three zone regions. Starting in Southern Illinois:

Zone 1 includes Collinsville, Herrin and Mount Vernon;

Zone 2 Quincy, Springfield and Urbana;

Zone 3 Bloomington, Kewanee and Peoria;

Zone 4 Geneva, Joliet and Ottawa;

Zone 5 Rockford, Waukegan and Woodstock;

Zone 6 is Wheaton. The Wheaton zone will be shared with three arbitrators who will rotate in and out of Chicago and Wheaton. The Wheaton cases will be divided into three bundles and one arbitrator will be assigned each bundle.

In the Rockford, Waukegan and Woodstock zone Arbitrator A will be in Rockford one month, Waukegan the next month, Woodstock the following month and will return to Rockford 90 days later. Each arbitrator will therefore hear one third of the cases in those venues and the cases will be reassigned. The Woodstock call will still remain the first Wednesday of every month, the Rockford call will be the second Friday of every month and the Waukegan call will be the third Friday of every month. Except for Woodstock there will be a two to three-day gap between the status call and hearings. Once the files have been assigned to an arbitrator they will stay with that arbitrator. However if another arbitrator is sitting in the venue where your case has been assigned, that arbitrator will be allowed to approve settlement contracts. If you file a 19(b) and your file was assigned to Waukegan and Arbitrator A, and on that particular month Arbitrator A is in Rockford, you will have to go to Rockford to have your 19(b) heard. You will not be able to arbitrator shop.

There is an alternative dispute resolution pilot program that will allow two different employers to set up ADR with a union provided all employees are members of that one union.

The CLE requirements for arbitrators and commissioners has been beefed up to specifically include black lung disease, utilization review, AMA guidelines and fraud.

There is a gift band for both respondent and petitioner attorneys. They may not spend more than $75.00 for food and refreshments that must be consumed on the premises. Should the gift band be violated it is a Class A misdemeanor.

Claims by Commission employees are now handled under Section 18.1 and independent arbitrators have been appointed to hear these cases. Those independent arbitrators are H. Case Ellis, W. Daniel Leahy, Alan Rosen and Edward J. Schoenbaum.

CONCLUSION

It is my opinion that the changes effectuated on June 28, 2011 will have a tremendous impact on the way we practice before the Illinois Workers' Compensation Commission. Depending on how the arbitrators and commissioners implement the AMA guidelines in determining disability we may or may not be filing claims that we routinely filed in the past. For example if that operated meniscus is worth 4% of the leg and the injured worker is 60 years of age and had a prior injury to the knee when he was 50 years of age, the employer has placed causal connection in dispute and you must do depositions. The cost of the deposition will be between $2,000.00 and $3,000.00. Also assume your employee is back to work. 2% loss of use of the leg is $3,366.00. The fee and costs will exceed the recovery. Those cases will not be filed.

The Republicans, the chamber of commerce and the Illinois manufacturers indicate that this is a watered down bill and it did not go far enough. They still would like to make causation an issue. They believe that in Illinois the work injury should be the primary cause of the disability or a significant cause. They want to eliminate injuries that aggravate or accelerate a pre‑existing condition. In order to obtain that goal, as well as what they have done in the past, they wrap it in the current economic climate and state that the only way Illinois will bring work back to the state is through the further amendments to the Illinois Workers' Compensation Act. Whether or not they will be successful in the future is something that is difficult to predict.