By Eugene Keefe
Keefe Campbell & Associates

In eight days, the election for governor and lots of state offices will come to a close and we will find out if the state will remain business as usual with the trilogy of Pat Quinn, Mike Madigan and John Cullerton on top or whether upstart state Sen. Bill Brady will take over.

At present, it is impossible to tell. Crain’s Chicago Business predicts things are going to change in the mid-term, as history tells us. They predict the governor’s office will change and the state house will move to a Republican majority. They similarly predict the Illinois State Senate will remain in the control of the current administration. If that happens, the legislative agenda for change in workers’ compensation will probably follow the tiresome and secret agreed-bill process with something for both sides to horse-trade.

As we have advised, it will be problematic for the management side to hood-wink the labor side, as we feel happened when Illinois labor bamboozled management in the last agreed bill in workers’ comp in 2005. As you will see below, the bill was supposed to be thoroughly researched, statistically analyzed and presented to all sides as “revenue-neutral” when in fact Illinois WC costs went up dramatically.
 
If Crain’s prediction is not accurate, we are certain workers’ compensation in this state will either remain painfully the same to Illinois employers or the forces of Sen. Brady will make efforts to change it in their image and likeness. It is our perspective Sen. Brady’s troops will be initially very busy with the economic challenges they face, but workers’ comp reform or “deform” will be on the agenda.
 
Why is workers’ compensation reform important? Well, President Doug Whitley of our Illinois State Chamber of Commerce publishes a regular message to his members and noted this week:

• Chief Executive Magazine ranked Illinois’ business climate 46th in the country in 2010.
• The ALEC-Laffler State Competitive Index of 2010 ranked Illinois 48th in economic performance and 48th in job creation from 1998 to 2008.
• Only New York and California had more outward population migration than Illinois, suggesting 640,000 people envisioned greater economic opportunity existed elsewhere.
• In 2005, Missouri lawmakers enacted reforms and have since seen their costs drop more than 20%.
• In contrast, since 2006 the total average increase in Illinois workers’ compensation rates was 16.4%, and 6.3% in 2009 alone. These are hard numbers, folks and not opinion.
• During the same period, average rates for workers’ compensation across the country decreased 17.1%
• Neighboring states can tout their workers’ compensation cost advantage to Illinois employers and businesses that are planning job expansions in the region.

We point out to everyone the shocking double-digit growth in Illinois workers’ comp costs can be attributed to the 2005 amendments to the Illinois WC Act, along with the appointment of very liberal administrators many of whom were former claimant attorneys to posts as arbitrators and commissioners. We also point out the budget of the Illinois Workers’ Compensation Commission almost quadrupled with little discernable change in speed or quality of resolution of pending claims.
 
We also point to a factor in the continued growth in Illinois workers’ comp costs to our reviewing courts who we feel write about 20 to 40 rulings each year. In our view, they issued two defense decisions in the last eight years. We also point out there is no member of either the Illinois Supreme Court or Workers’ Compensation Division of the Appellate Court who regularly dissents so as to provide a voice to the interests of Illinois business.

Most times, oral arguments before the reviewing courts make many defense lawyers feel they have not one but numerous opponents. Many defense attorneys feel they have to struggle with opposing counsels and the justices before whom we appear. We also point out the Appellate Court, Workers’ Compensation wrote several excellent defense-focused decisions that might have provided some balance to their rulings—in anti-business rulings in cases such as Interstate Scaffolding, the Illinois Supreme Court accepted certiorari and issued controversial decisions that reversed all of the more management-oriented rulings from the courts below.
 
So, how would we change the commission and workers’ comp system in this state?
 
Well, our vote on legislative change remains the same:

• Roll back the permanency rate increases from 2005 for an immediate defined savings of 7.5% on all PPD;
• Change the statute to confirm work must be “the” cause and not “a” cause of a deleterious condition leading to WC benefits;
• Utilization review protocols should be mandatory and/or have a more defined and predictable value in litigated claims with disputes over surgery or other major medical disputes;
• We need 500-week or maybe 750-week caps on death claims, total and permanent disability or wage-loss claims.

From an administrative perspective, we recommend cutting arbitration staff in half and keeping the top veteran arbitrators in place. We point out new WC claims have dropped from 75,000 a year to about 45,000. We also strongly urge everyone to use the savings to let them work all year and provide 20% raises to reasonable arbitrators and commissioners, which would close the salary gap in relation to Illinois’ judiciary.

We further suggest dropping the number of commissioners back to six, which would be an immediate savings to taxpayers of about $1 million per year. Try to insure each commissioner and their two assigned assistant attorneys each issue at least one contested ruling a week to see if we actually need six members and might get along with only three.
 
We also recommend having the “commission” act as a commission and openly meet quarterly to make them open and available and responsive to the members of Illinois labor and business. We feel the commission should closely watch and consider concerns about business folks who aren’t getting WC insurance along with how to stop what some members of the Illinois business community feel is a new rising wave of WC fraud by injured workers.
 
In our view, the commission might want to consider how to best address the issue of claimant lawyers who file lots of claims of very minimal value and then let the claims drift and linger at a high cost to the Illinois WC insurance and business community. As we have advised, the bar used to police themselves and now there are filing claims for sunburn and broken dentures. We also feel disputed death claims should be tried or dismissed within one year of filing, as every disputed death claim means there is a widow or widower out there who isn’t getting benefits and an employer with six-figure reserves that is furious to not have a resolution. We see no reason for years of inaction on disputed death claims by attorneys.
 
Another solid idea is already being done by a very few of the sitting Arbitrators—create time-lines for resolution and provide copies of the time-lines to the attorneys. In this fashion, both sides have a target and a goal to attain. If one side or the other can’t follow reasonable time-lines, they face dismissal with prejudice on one side or an ex parte hearing on the other. Either way, the injured worker and employer can expect a predictable resolution, similar to many federal courts.

Eugene Keefe is a founding partner of Keefe Campbell and Associates, a workers' compensation defense law firm in Chicago. This column was reprinted with his permission from the firm's client newsletter.