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2011 Amendments To The Illinois Workers Compensation Act
1. Eugene F. Keefe
John P. Campbell, Jr.
Arik D. Hetue
Keefe, Campbell & Associates
Chris Rocks
Woodlake Medical Management
2. Section 1 of the Illinois Workers’ Compensation Act
was amended to specifically outline an employee bears the burden
of showing, by a preponderance of the evidence
• They have sustained an accidental injury
• Arising out of and
• In the course of employment.
This was always the legal standard pursuant to longstanding case
law, but it is now codified in the Statute.
Please also note case law holds repetitive trauma can be classified
as an “accident” and no one knows what “arising out of” might
mean in such claims.
We do not consider this to be a significant change nor is it a true
“cost-savings” for Illinois employers or insurance carriers.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 2
3. Section 1.1 of the Illinois Workers’ Compensation Act
implements Standards of Conduct for Commissioners and
Arbitrators, who shall conduct hearings in a fair manner without
bias or prejudice.
Portions of the canons of the Code of Judicial Conduct have been
adopted and are to apply to the Commission and Arbitrators.
We also note that pre-trials are specifically addressed as a practice
that is permitted as long as the pretrial is performed in accordance
with the rules of the Commission.
Again, this is not a significant change nor does it represent a cost-
savings.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
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4. Section 4(a)(2) of the Illinois Workers’ Compensation Act
specifically defines Employee Leasing Companies under the Act and
compels them to provide the Commission with proof any client
company of the Employee Leasing Firm is listed as an additional
named insured on their policy.
Not a significant change—this provision addresses a concern of the
claimant bar.
It will be a concern for Employee Leasing Companies and should
work to clarify insurance concerns.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 4
5. Section 4(d) of the Illinois Workers’ Compensation Act
is broadened to allow an investigator with the Illinois Workers'
Compensation Commission Insurance Compliance Division to issue
citations to employers that are not in compliance with their obligation
to establish workers’ compensation insurance under the Act.
Fines range from $500.00 to $2,500.00 for violations.
The knowing or willful failure to comply with a citation issued by an
investigator could result in fines up to $500.00 per day with a
minimum penalty of $10,000.00.
Not a significant or cost-saving change and it is another concern of
the claimant bar and not the defense industry.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 5
6. Section 4b (not to be confused with section 4(b), which is a subsection of 4) of the Workers’
Compensation Act is an entirely new section. It creates a collective bargaining “pilot program” which
applies only to businesses involved in “construction” as follows:
The Director of the Department of Labor shall designate two labor organizations to participate in a
collective bargaining process. The prospective parties to a collective bargaining agreement shall file with
the Commission and the State shall recognize any valid binding collective bargaining agreement between
the construction employer and the labor organization which properly outlines the obligations and
procedures for workers’ compensation benefits. The terms may include alternative dispute resolution to
replace the procedural function of the Commission and this will include mediation, arbitration or other
dispute resolution proceedings which may be final and binding.
• An agreed list of medical treatment providers may be an exclusive source of all medical treatment.
• The use of a limited list of impartial physicians to conduct independent medical examinations.
• The creation of a specific light duty modified return to work program.
• A limited list of individuals for the establishment of agreed vocational rehabilitation.
The establishment of a joint labor management safety committee. Of note, specifically outlined in this
Section is a rule prohibiting any collective bargaining agreement from diminishing or increasing a
construction employer’s duties under the Act or an employee’s entitlement to benefits otherwise set forth.
Therefore, it appears the collective bargaining agreement cannot contract away the rights and protections
as well as the right to recovery for injuries the Act. Of note, the construction employer must notify their
insurance carrier of their intention to enter into such a collective bargaining agreement. The Commission
is to record any settlements under the “alternative dispute resolution plan”.
This is considered a significant change but the significance will be measured by the level of participation
of construction unions and their employers. In our view, we do not anticipate high levels of participation
but it is impossible to predict acceptance in the specific industry.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 6
7. Section 8(a) of the Illinois Workers’ Compensation Act
clarifies medical bill payment shall fall within
the fee schedule even where the accounts
receivable of the provider are sold to a third
party (e.g., the Med-Finance-type groups).
Not a significant change and may be more
properly termed a clarification.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 7
8. Section 8(a)(4) of the Illinois Workers’ Compensation Act
outlines when an employer has an approved “preferred provider program”
pursuant to Section 8.1(a), the employer shall, in writing on a form
promulgated by the Commission, inform the employee of the preferred
provider program and then subsequent to the report of injury, the
employee may choose in writing at any time to decline the preferred
provider program in which case that would constitute one of the two
choices of the medical providers to which the employee is entitled.
• Subsection C indicates prior to the report of an injury, when an
employee chooses non-emergency treatment from a provider not within
a preferred program, this will constitute the employee’s one choice of
medical provider to which the employee is entitled.
Our guess is this will take care of repetitive trauma claims where treatment
begins prior to an alleged date of injury.
We expect this to be a major and significant change in which preferred
medical provider programs may take on a strong role in the future
handling of Illinois workers’ comp claims. If they reach a high level of
acceptance, it could have a strong impact in saving costs.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 8
9. Section 8(d)(1) of the Illinois Workers’ Compensation Act
confirms any award for wage differential for accidents occurring after
September 1, 2011 shall be effective only until the employee reaches
the age of 67 or five years from the date the award becomes final,
whichever is later.
We initially reported this to effect all pending wage differential claims
—that is incorrect; it applies to such claims for accidents arising after
September 1, 2011. It does not apply to all existing claims.
This new Section should be a dramatic savings in resolution of wage
loss differential claims that are currently valued and reserved as
lifetime benefits.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 9
10. Section 8(e)(9) the Illinois Workers’ Compensation Act
specifically delineates hand injuries involving carpal tunnel
syndrome due to repetitive or cumulative trauma be returned to
their pre-2005 scheduled amount of 190 weeks, and places a
disability limit of 15% loss of use of the hand in such cases,
unless clear and convincing evidence can show an award should
exceed this amount. In such cases the award should not exceed
30% loss of use of the hand.
This new Section should have an impact on handling CTS claims.
Once the Amendments are signed, all existing claims should be
reviewed and potentially reserved with this new provision in
mind.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 10
11. Section 8.1(a) of the Illinois Workers Compensation Act
outlines a Preferred Provider Program on the effective date of the Act allows an
employer to utilize the program approved by the Illinois Department of Insurance.
In such instances the employee is considered to be a court beneficiary and the
employer is considered to be “the insured”. This Section also outlines any
provider network must include “adequate” occupational and non-occupational
providers. It shall include an adequate number and types of physicians to treat
common work injuries in the general geographic area where the employee
resides. The Director of Insurance may deny approval of any such preferred
provider program where it is determined a policy or procedure is put in place
which causes unfair reduction or delay of medical treatment.
A word of caution: it appears the employee, once he or she elects to treat within
the provider network is permitted to choose any physician within the network
without restriction on the choice of physicians. Therefore, it appears employees
may be allowed to seek numerous second, third or fourth opinions, as long as the
providers are within the network.
We consider this one of the three most significant cost-saving aspects of the
2011 Amendments to the Act—we urge all Illinois employers to implement
Preferred Provider Programs for their WC risk moving forward.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 11
12. Section 8.1(b) of the Illinois Workers’ Compensation Act
delineates the determination of permanent partial disability. For all accidents
occurring on or after September 1, 2011, permanent partial disability shall be
established by a licensed physician reporting on the level of impairment in writing.
The report shall include an evaluation of medically defined and professionally
appropriate measurements of impairment that shall include, but not be limited to,
lost range of motion, loss of strength, any atrophy or tissue mass reduction or any
other measurement that may establish the nature and extent of impairment. The
most current edition of the American Medical Associations Guide to the Evaluation
of Permanent Impairment shall be used.
In determining permanent partial disability value, the Commission shall base its
determination on the following factors: 1) the reported level of impairment
pursuant to the above Section, 2) the occupation of the employee, 3) the age of
the employee at the time of injury, 4) the employee’s future earning capacity, 5)
evidence of disability corroborated by the treating medical records. Of note, no
single enumerating factor shall be the sole determining factor for disability.
We do not consider this provision to be a significant change to Illinois WC law.
Obviously, treating doctors and IME evaluators may start using the most current
AMA Guidelines but the Commission may do with them as they will.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 12
13. Section 8.2 of the Illinois Workers’ Compensation Act
contains medical fee schedule modifications which appear to be the major cost saving mechanism in the new changes to the
Act on its face. The changes are as follows:
• Out of state providers shall be reimbursed at the lesser of that state’s fee schedule or the State of Illinois fee schedule. In
the event there is no fee schedule in the outside jurisdiction, the lesser of the actual charge or the Illinois Fee Schedule shall
apply. This applies as of the effective date of the legislation.
• The Commission is to maintain schedules for procedures and services including ambulatory surgical treatment centers,
facilities and prescriptions filled and dispensed outside of a licensed pharmacy.
• Beginning January 1, 2012 the fee schedule amount shall be grouped into geographic regions which are consolidated from
the present geographic breakdown. These include 1) Cook County, 2) DuPage, Kane, Lake and Will County 3) Bond, Calhoun,
Clinton, Jersey (and other downstate counties) 4) any counties not delineated in the Act specifically. In the event any fee
schedule regions overlap, the Commission shall average the two fee schedule amounts.
• If a fee schedule amount is in place, effective September 1, 2011, the charge shall be no more than 70% of the fee scheduled
amount. If a fee schedule amount cannot be determined, the default reimbursement shall remain at 76% until September 1,
2011 at which time a 53.2% reimbursement rate shall apply.
• Prescriptions filled outside a licensed pharmacy shall be reimbursed at a rate that does not exceed the Average Wholesale
Price, plus $4.18 as a dispensing fee.
• Implants shall be reimbursed at 25% above the manufacturer’s invoice price, less rebates.
• Please note that the timeline for prompt payment has been reduced from 60 days to 30 days whereupon a provider provides
a substantially all data required to pay the bill. This imparts an obligation on the insurance companies or self-insureds to
promptly identify the basis for non-payment within a 30-day period rather than the prior 60 day window.
• Of particular relevance, providers may no longer bill or attempt to recover from an employee the difference between the
provider’s charge and the amounts paid by the employer for treatment determined by the Commission to be excessive or
unnecessary. This is significant to the extent that any denied treatment which has been deemed excessive by the
Commission will prohibit those providers from alternatively seeking payment directly from the claimant.
This is the biggest savings provision in the 2011 Amendments to the Illinois Workers’ Compensation Act. We feel this will
result in savings well into the hundreds of millions of dollars on a system-wide basis. We caution it will take some time for the
industry and Workers’ Compensation Commission to catch up to it.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 13
14. Section 8.2(a) of the Illinois Workers’ Compensation Act
outlines a requirement for the acceptance of
electronic medical billing and also compels medical
providers to establish standardized forms. The
Director of Insurance shall establish the necessary
criteria.
This is not a dramatic cost-savings but should
result in streamlined payment and medical bill
handling; if that occurs, litigation and confusion
may be avoided in the future.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 14
15. Section 8.7(a) of the Illinois Workers’ Compensation Act
provides in utilization review, nationally recognized
treatment guidelines and evidence based medicine
shall be used.
We don’t consider this a change to existing law.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 15
16. Section 8.7(i) of the Illinois Workers’ Compensation Act
is a new section on implementation of UR for treatment after September 1, 2011 as follows:
• Upon written notice the employer or an insurer is invoking utilization review, the provider must
submit to the utilization review process and make a reasonable, timely and complete reports of
clinical information needed to support the request. If a provider fails to make such reasonable
efforts, the charges for treatment or services may not be compensable nor collectible by the
provider or claimant. Any findings upon utilization review must be provided to the provider and
employee.
• Clarification of an important restriction on utilization review indicating an employer may only deny
payment or refuse authorization on the grounds the extent and scope of medical treatment is
excessive or unnecessary pursuant to utilization review guidelines. This is significant to the extent
utilization review providers shall no longer be allowed to comment on causal connection, or at
least such opinions will not be considered.
• A petitioner must establish by the preponderance of the evidence that a variance from utilization
review standards is reasonably required before treatment denied under UR will be awarded.
• There is a requirement the final reviewing professional must be either available in the State of
Illinois for interview or deposition, or be available via telephone, video conference or any electronic
means for remote deposition purposes. We consider this a needless waste of money and time, as
the UR professional is no longer able to effectively comment on causation, their report is
essentially a non-opinion medical record. Explaining the disability guidelines will be as effective on
paper as it is verbally.
Consistent with existing law and past practices, this is going to be a significant cost-savings if the
Commission adheres to UR—we can only wait and watch to see what they do.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 16
17. Section 11 of the Illinois Workers’ Compensation Act
provides an intoxication defense, however, this was greatly limited.
The new section confirms no compensation shall be payable if an employee’s intoxication is the proximate
cause of the employee’s accidental injury at the time of the accident, or if the employee was so intoxicated the
intoxication constituted a departure from the employment.
• Admissible evidence of the concentration of cannabis or a controlled substance listed in the Illinois
Controlled Substances Act shall be construed in any hearing to determine any level of intoxication. The .08
alcoholic standard applies for alcohol pursuant to Illinois law. Concentrations at these levels create a
rebuttable presumption of intoxication being the proximate cause of the injury.
• If the employee refuses to submit to testing of blood, breath or urine, there shall be a rebuttable
presumption the employee was intoxicated and that the intoxication was a proximate cause of the injury.
• The employee may overcome these rebuttable presumptions by proving by a preponderance of the evidence
the intoxication was not the “sole or proximate cause” of the injury. The defense was stripped of its teeth
with this addition – as a “sole proximate cause” is almost a legal nullity; any first year torts student can tell
you proximate cause is a tricky issue, as every event leading up to an injury can be a proximate cause of the
injury.
• Employers should be careful to note the rules must ensure samples are collected and tested in conformance
with national, state, legal and regulatory standards for privacy in a manner reasonably calculated to prevent
substitutions or interference in such collection. Employees are afforded the opportunity to provide
notification of any information which they believe relevant to the tests, including identification of any
recently used prescription or non-prescription medication. The sample storage, transportation and place of
testing must reasonably preclude the possibility of contamination.
There is no way to tell if this new Section is going to be a cost-savings; we will have to wait and see what the
IWCC does with it.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 17
18. Section 13 of the Illinois Workers’ Compensation Act
confirms Commissioners must complete 20 hours of training in areas
of ethics and evidence every two years that they remain in office.
We don’t consider this a change of any interest.
Section 13.1(d) of the Illinois Workers’ Compensation Act
confirms the members of the WC Advisory Board are terminated on the
effective date of the legislation, and new members shall be appointed
by Governor Quinn within 30 days.
We don’t consider this a change of any interest. Observers may note
the WC Advisory Board had little to do with the Amendments to the Act.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 18
19. Section 14 of the Illinois Workers’ Compensation Act
confirms the term of all sitting Arbitrators shall terminate as of July 1, 2011; however, incumbents shall
continue to exercise all duties until they are appointed or successors are appointed. Thereafter all
Arbitrators shall be appointed to three year terms by the full Commission.
• Of note, all Arbitrator appointments shall be made by the Governor with the advice and consent of
the Senate.
• Arbitrators are subject to the same ethical and training requirements as Commissioners were in
Section 13.
• Twelve Arbitrators shall be appointed with terms expiring July 1, 2012. Twelve other Arbitrators
shall be appointed with expiration July 1, 2013 and all additional Arbitrators shall be appointed with
terms expiring July 1, 2014. Upon expiration of a term, the Chairman shall evaluate performance of
the Arbitrator and may recommend he or she be reappointed.
• Moving forward, each Arbitrator appointed after the effective date of the amendments who is not
previously served shall be required to be authorized to practice law in the state of Illinois and
maintain such authorization.
• The Commission shall also assign no fewer than three Arbitrators to each hearing site and the
Commission shall establish a procedure to ensure cases are assigned randomly. No Arbitrator shall
hear cases in any county other than Cook for more than two years in each three year term.
This is not a significant change but we will have to watch and wait on who gets to keep their jobs and
who the Governor lets go and then randomly appoints. We feel the current Arbitration staff is being
unfairly punished as a group for mistakes made by two Arbitrators in the Menard Corrections Center
“scandal.”
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 19
20. Section 16(b) of the Illinois Workers’ Compensation Act
has a gift ban explaining attorneys appearing before the Commission
shall not provide compensation or any gift to any person for exchange for
referral of a client involving a matter to be heard before the Commission
except for the division of fees between lawyers who are not in the same
firm. A gift is explained to be any type of gratuity, entertainment or
hospitality except food and refreshments not exceeding $75.00 per
person on a single calendar date.
This is not a significant change and we consider it virtually impossible to
enforce. Please note it applies to attorneys on both sides of the practice.
Sections 18 and 18.1 of the Illinois Workers’ Compensation Act
indicate any claim by a former or current employee of the Commission
must be assigned to a certified independent Arbitrator, not employed by
the Commission, and as designated by the Chairman.
Again, this is not a significant change and we don’t know how they are
going to find “independent” hearing officers who know the Act and Rules.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 20
21. Section 25.5 of the Illinois Workers’ Compensation Act
addresses WC fraud and delineates unlawful Acts and penalties for various violations.
• Subsection (a)(9) adds intentionally presented bills or statements for services not provided
as a violation.
• Any violation of subsection (a) for $300.00 or less becomes a Class A misdemeanor;
• Any violation over $300.00 and not more than $10,000.00 is a Class 3 felony;
• Any claim or attempt to collect fraudulently in excess of $10,000.00 is a Class 2 felony;
• Any attempt to collect fraudulently in excess of $100,000.00 is a Class 1 felony.
• Any person convicted under this section shall pay restitution for any such charges
fraudulently collected.
• Subsection (e-5) requires the Fraud and Insurance Non-compliance Unit to develop a
computer modeling system which looks at social networking, data mining, and other
advanced computer processes to prevent fraud and waste. The unit will implement this by
July 1, 2012 and will provide annual reporting on the topic to the legislature, the Governor,
the Chairman of the IWCC and the Director of Insurance annually after implementation.
• Subsection (h) requires the Fraud and Insurance Non-Compliance Unit to issue an annual
report to the Chairman of the Commission and the General Assembly outlining the number
of allegations of insurance non-compliance and fraud reported, the source of reporting and
the number of allegations investigated.
We still don’t see this as a major change but we will have to see how State’s Attorneys across
Illinois handle the newly heightened felony levels in prosecuting WC fraud.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 21
22. Section 29.2 of the Illinois Workers’ Compensation Act
implements insurance oversights where the Department of Insurance shall submit to
the Governor and the President of the Senate and Speaker of the House, reports
detailing the state of workers’ compensation insurance market in Illinois. The
reports are to contain the following:
• Gross premiums collected and the number of insurance companies engaged in
the business.
• The extent of loss ratios reported and gross profitability of workers’
compensation insurers.
• Statistics on Illinois’ rank relative to other states in terms of TTD benefits and
PPD benefits in addition to aggregate growth of medical utilization for the top
ten most common injuries.
• Various other items such as the utilization of nurse case management, utilization
review, the number of claims in which outside defense counsel participate, a total
amount paid to outside defense counsel.
• The total amount paid by injured workers to attorneys for the representation
shall be reported.
We caution this section could impose significant costs on employers and insurers in
regard to collating and transmitting sensitive information. We predict it will not be
strictly enforced.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 22
23. Changes Specific to State of Illinois Workers’ Compensation Claims Management, as provided in
amendments to bills other than the Workers Compensation Act
The Director of Insurance for the State can prepare and implement a plan to purchase Workers’
Compensation insurance for the State.
We note individual State agencies will be compelled to fund TTD payments themselves in the
event that light duty is not accommodated once the light duty release is issued pursuant to the
treating doctor and the IME physician. This appears to be an effort to contain lost time benefits
for State employees and we find it to be a positive provision to contain costs for the State of
Illinois.
The Department of Central Management will develop an advisory body known as the State
Workers’ Compensation Program Advisory Board designed to review, assess and make
recommendations to improve the State workers’ compensation program. The Governor is to
appoint one member of the Board with the Speaker Of The House and Minority Leader to appoint
other members. Members of this board shall serve three year terms.
We note the Code of Civil Procedure was amended whereupon Section 8-802 declares that
physicians are to maintain the privacy of patients however, along with other civil and criminal
legal actions, the issuance of a subpoena pursuant the Workers’ Compensation Act shall compel
physicians to release records however, the Mental Health And Developmental Disabilities
Confidentiality Act will override any such subpoena.
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 23
24. Keefe, Campbell & Associates
• One of Illinois’ top defense trial firms
• Handling defense of workers’ comp, general
liability and employment law matters in Illinois
and Wisconsin
• Shawn R. Biery, J.D., MSSC. Certified Medicare
Specialist on staff
• 24-hour email hotline for defense information
and advice at ekeefe@keefe-law.com
• Regular email updates on all Illinois and Federal
laws and appellate cases for all interested parties
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 24
25. Woodlake Medical Management
To Contact Woodlake
10249 Yellow Circle Drive, Suite
220
Minnetonka, MN 55343
ph: 952.253.6600 •
800.804.4008
fax: 952.253.3900
woodlake@woodlakemedical.com
Keefe, Campbell & Associates and
Woodlake Medical June 2011
Webinar 25