After a year in which courts in Florida, Oklahoma and Utah ruled portions of state workers' compensation statutes unconstitutional, some state lawmakers in Kansas are worried that the Legislature may have gone too far with reforms passed in 2013 and are proposing to roll back many of the changes.

Rep. John Carmichael

Rep. John Carmichael, a Wichita Democrat whose party is outnumbered 31-9 in the Kansas House of Representatives, has introduced four labor-friendly workers' compensation bills that would undo many of the provisions passed by the state Legislature. He said he doesn't think passage of his bills will do enough to improve the system, but believes that the Legislature's pro-business majority may finally be willing to listen. 

Lawmakers might have to. If a constitutional challenge to the workers' compensation system goes to the state Supreme Court as both opponents and proponents expect it to, the decision could upend the whole thing. That would leave employers facing a graver threat than higher premiums: liability in civil suits.

"I think a reasonable legislator can see when they've pushed too far," said Michael Snider, a claimants' attorney in Kansas for 32 years. 

In 2013, he said, "they went too far."

Turning back the clock

Carmichael's bills officially bear the seal of the House's Commerce, Labor and Economic Development Committee. But in Kansas, that designation is more of a formality, he said.

"There is a tradition in this Legislature that anybody can offer a bill to be sponsored by the committee. Seldom, if ever, is there an objection, and seldom, if ever, is there a bill refused by the committee," Carmichael said. "But just because the committee accepted those bills does not mean that the majority of the committee supports the bill, as evidenced by the fact that only one bill of these is going to a hearing now."

Carmichael, a claimants' attorney, said he anticipates that just one of the bills he introduced will survive to see a debate on the House floor. 

The bills — HBs 2056, 2058, 2059 and 2062 — would roll back some of the reforms made by an emboldened conservative government in 2013. They also propose revising some of the 2011 reforms, which both business and labor agreed on, because a 2013 "bait-and-switch" bill changed the terms upon which the reforms rested.

Carmichael's bills propose rebalancing the administrative law judge nominating committee, lowering the strict compensability standard and, perhaps most notably, reverting from the sixth edition of the American Medical Association Guides to Permanent Impairment to the more worker-friendly fourth edition. 

Switching from the fourth edition to the sixth in 2013 was the "bait-and-switch" that claimants' attorney and law professor Jan Fischer said pushed Kansas' workers' comp system from business-friendly, but workable, to an inadequate substitute for the right to sue.

This is because the bipartisan reforms of 2011 rested on an understanding that Kansas would keep using the fourth edition, Fischer said.

"One of the things we talked about during negotiations was what impairment rating guide we were going to use. It was important because it impacted some of the other changes we were talking about," Fischer said. "We decided to stay with the fourth edition guidelines."

The 2011 reforms established that workers with disability ratings of less than 7.5% would be ineligible for enhanced benefit packages, or larger awards. Claimants' attorneys agreed to that compromise, as 7.5% disability ratings were not terribly hard to come by under the fourth edition.

That changed with the sixth edition, Snider said. Now, he said, employers bring in multiple independent medical examiners to try to prove that a worker's disability rating is less than 7.5%, which is much easier to do than it used to be.

"They agreed to this work comp reform, then threw a new book at us," Snider said. "You could resolve a case back in 2011 for fair compensation and not get a bunch of experts hired. But now, it's every case under the interpretation of various people from the defense side of it. There's no case worth more than 4.5%. It means that there's no case worth more than $10,000 to $15,000 in the workers' comp system."

HB 2059, which would return Kansas to the fourth edition, is the only bill for which a hearing is currently scheduled. Rep. Les Mason, R-McPherson, the chair of the House's labor committee, said he does not expect the Legislature to take action on HB 2059 either — at least not while a challenge to the Guides circulates in the courts.

Pardo v. UPS

Claimants' attorney Keith Mark is seeking the same change through the courts that HB 2059 seeks through the Legislature. 

Mark represents Francisco Pardo, a United Parcel Service driver whose shot at a decent award was blown by the change to the sixth edition. Pardo injured his shoulder twice, and the sixth edition specifically forbids workers to be re-rated for a second shoulder injury. Pardo was thus issued a rating of 0% for his second injury, so despite the damage to his body, he received no money. Mark argued that this was unconstitutional.

The case was most recently heard before the Workers' Compensation Appeals Board, which cannot make determinations on constitutionality. 

But in his a concurring opinion, Administrative Law Judge Steven J. Howard wrote, "Simply put, use of (this version of the) AMA Guides makes the quid pro quo inadequate."

The case will now go before an appellate court, with its attorney taking pains to get it before the Kansas Supreme Court. 

"I anticipate it will end up there," said Eric Stafford, the Kansas Chamber of Commerce's vice president of governmental affairs. "They seem pretty aggressive in pushing it forward."

Balance of power

When it comes time to elect lawmakers in Kansas, it's less a battle of red and blue than of red and redder. Many races are essentially decided in the primaries, when moderate and conservative Republicans duke it out for the seat that will almost inevitably carry the general election. Kansas' Republican supermajority in both houses goes back decades.

In 2016, conservative Gov. Sam Brownbeck's budget was running a $345 deficit, attributed to deep income tax cuts, and his approval rating was the lowest of any governor in the nation. He had led a successful push in 2012 to stock the Statehouse with conservatives, but by last November, many Kansas Republicans were no longer interested in supporting his agenda. Moderates took back more than a dozen seats in last year's election, returning the microphone to a voice that has been quiet in the Legislature since 2012.

Even before that shift to a more moderate Legislature, some law professors and even a business owner told state lawmakers that reforms that took effect on Jan. 1, 2015, may have made the system vulnerable to be ruled unconstitutional, allowing claimants to file civil suits. 

Secretary of State Kris Kobach and Washburn University law professor Bill Rich told The Wichita Eagle in March 2015 that if the courts decide Kansas workers' compensation system does not fulfill the grand bargain between management and labor, disputes could be resolved in civil courts, with awards that can reach the millions.

Tim Voegeli, owner of the Tubeless Solutions bicycle-part manufacturing company in Wichita, testified during a legislative hearing in 2015 that he's worried "trial lawyers" will get ahold of injured workers' claims and drive up costs with jury awards.

“It sounds like a good deal, being able to reduce the amount of claims that maybe someone is willing to file, but the problem is all it would take is a couple of big claims and boy, they’d stay with you almost forever,” Voegeli said, according to the Wichita Eagle's account.

Business leaders in Florida learned how disruptive judicial intervention in a state workers' compensation system can be last April, when the Supreme Court overturned a statute that capped claimants' attorneys fees and the state's 104-week limit on temporary disability benefits. The Office of Insurance Regulation approved a 14.5% rate hike largely as a result of those rulings.

In Oklahoma, the Supreme Court overturned a law that allowed employers to opt out of the state workers' compensation system by buying alternative benefit plans, forcing more than 50 businesses to return to traditional workers' comp coverage. And in Utah, the Supreme Court overturned a statute that capped attorney fees, although that ruling had only a modest impact on system costs.

A hearing on HB 2059 is set for Tuesday before the Kansas House Commerce, Labor and Economic Development Committee.