Illinois Lawmakers Propose Changes To Workers’ Compensation Law

Illinois lawmakers are looking at benefit increases and cost reductions in their state=s workers’ compensation system. House Bill 805 is awaiting final action, as members continue budgetary talks. The legislation was said to be the result of a labor and business agreement, although one employer organization opposes the measure.

HB 805. Specifically, the bill includes the following provisions:

  • Increase permanent partial disability payments form 60 percent to 66/23 percent – an 11 percent increase.
  • Increase the minimum weekly temporary total disability payment from $100.90 for a single person to $146.67 immediately, and $173.33 – a 72 percent increase on Jan. 1, 2005. It also raises the minimum TTD rate fora person with 4 children from $124.30 to $220 immediately, and $260- a 109 percent increase – on Jan 1, 2005.
  • Imposes a penalty of 1 percent per month for employers that fail to pay medical charges within 60 days.
  • Prohibits medical providers from billing injured workers for the balance of charges not paid by an insurance company.
  • Includes workers injured as a result of a terrorist attack for benefits.
  • Creates a medical fee schedule to be established by the Illinois Industrial Commission. It provides for medical providers to be paid 90 percent of the 80th percentile of usual and customary charges for medical services provided in the region, with the fees tied to the inflation rate. However, it allows the commission to set higher fees if there is a significant limit on access to quality health care in either a specific area of healthcare or a specific geographic area.
  • Creates a medical fee advisory board to advise the commission on fees. The board would consist of nine members – three each from employees, employers and medical providers – appointed by the governor.

“Establishing a fee schedule will provide certainty to businesses looking to locate in Illinois on potential costs they will face,” said Sen. Terry Link, a cosponsor of the bill. “By reducing costs, we send the message that Illinois is a good placed to do business – and that should help create jobs.”

Reactions. The Illinois Municipal League is urging a “no” vote on the legislation, saying it would be detrimental to municipal employers. It argues the measure would increase costs. “Tell your senator and representative that higher payments, particularly for PPD, are both unwise and unnecessary,” the organization said. It disputed contentions that benefit increases would be offset by limitations placed on the growth of the workers’ comp-related medical costs. “We have serious concerns that such cost savings are illusory and dubious.”

But the National Federation of Independent Businesses said it supports the legislation, based on a survey of its members. “Seventy percent of the small-business owners who responded said their workers’ comp premiums had increased over the last year; over 50 percent said their premiums had increased anywhere from 5 to 30 percent,” the NFIB said in a message on its Web site.

“Clearly our members are looking for some relief in workers’ comp costs.”