Keefe, Campbell & Associates, LLC

Editor’s comment: We note with chagrin the plethora of articles now on the web outlining growing concerns with head and brain injuries in American professional football. This sport of humans clashing heads together at high impact is now subject to a growing wave of workers’ compensation claims for dementia, lack of coordination, loss of mind and memory. Recent studies have shown numerous football players have suffered head injuries as a result of multiple concussions with resulting clear signs of chronic traumatic encephalitis or CTE. It has been alleged chronic traumatic encephalitis results in early dementia, onset of Alzheimer’s disease and numerous other demonstrable brain disorders. Studies indicate the average high school, college and professional football player sustains over 1,000 measurable concussions in every game. Please note in Illinois, a claimant does not have to typically demonstrate a single injury—sadly, this state is generally to wildly liberal about “repetitive trauma” that is defined by a modern football game and/or practice.

Recently prominent workers’ compensation claims have been filed by several former professional players against the National Football League in California. We assume many other players are considering signing up for the largesse. Every single former player and their counsel point out how awful it is that football teams are so valuable and prosperous while day-to-day players are supposedly left out in the cold with little or no compensation. Every claimant appears to be demanding monster settlements for lifetime medical coverage for any head or brain malady almost as a constitutional entitlement. Observers note this mind-set and statutory scheme makes California a fertile and prosperous jurisdiction for football-based workers compensation claims. Several other states, such as Illinois and New Jersey may be right behind the “Left Coast” in fostering similar brain injury claims. And once professionals start raking in cash, how long will it take for high school and college players to start filing negligence claims against their former schools?

The problem we see with all of it is football is already a very expensive game and is something of an orthopedic surgeon’s fantasy. Modern football players are constantly under treatment and may be disabled as much as or more than they are healthy—most professional football teams have rosters of about 50 players but actually need 100 or more players to get through a complete season. The medical bills for an average NFL or Arena football season have to be well into the tens of millions already. If you add to that cost provision for lifetime medical coverage for every brain dysfunction any football player ever suffers, you are almost certainly going to bankrupt what is our current national past-time.

Please let us know your thoughts or post them on our award-winning blog.

Editor’s comment: As a follow-up to last week’s article on “repackaged” prescription drugs, we were asked by a reader to direct all of you to this answer on the Illinois web site regarding how to best pay for drugs under the Illinois workers’ compensation system. The reader found it in the Frequently Asked Questions section on our Illinois Workers’ Compensation Commission’s informative website.

Moments earlier, the reader received a letter purportedly from a pharmacy biller’s “counsel” stating they had been in touch with someone at the Illinois Work Compensation Commission who claimed they were told by an unnamed official what to do in processing pharmaceutical bills. The letter claimed their “counsel” had been told the repackaged drugs for which they were billing astronomical rates should and must be paid for at 76%.

If you are not aware of this new phenomenon, the relatively new concept of “repackaged” drugs occurs when medical providers buy wholesale prescriptions for what you can get them for at a typical pharmacy and then “re-price” them at an exorbitant markup. The provider would then simply add the much higher drug cost to overall medical billing and hope the medical bill payer would simply approve or discount marginally, creating an enormous profit.

The problem with that approach is it is in direct opposition to what the Commission’s web site says! The Commission website provides:

How should pharmacy drugs be paid?

The fee schedule does not apply to pharmacy prescriptions. Prescriptions should be paid at the usual and customary rate. The law and rules make no mention of what the usual and customary rate is. No formula was adopted. If there is a dispute, the parties would take the issue before an arbitrator.

Our reader advised there are some general HCPCS codes on the fee schedule (e.g., J3490: unclassified drug) that show a fee or POC76 (i.e., pay 76% of charge). Some providers try to use these codes for prescription bills and claim payment should be at that fee or at 76% of charge. Our reader asserts this view is incorrect and should be rejected. We agree that drug vendors should not improperly implement HCPCS codes to side-step the fact Illinois does not have a WC pharmacy fee schedule.

We have forwarded the letter and the concerns we have about “repackaged drugs” to our Illinois Attorney General’s office for their consideration. We assure everyone of our view the practice is simply and patently gouging when it comes to a fair price for prescription medications for Illinois employers and injured workers.

We thank our reader for her thoughts and recommendations. We would love to forward any response you might have.

Editor’s comment: Last month the Medicare Secondary Payer Enhancement Act of 2010 (MSPEA) was introduced in the U.S. Congress as proposed legislation. It contains some significant changes from the current law, the Medicare Secondary Payer Statute (MSP). Many observers on both sides feel the current Medicare Secondary Payer (MSP) system is inefficient and creates problems for Medicare beneficiaries, the Centers for Medicare and Medicaid Services (CMS), and anyone who settles a claim involving Medicare liability. Proponents of the new law feel the Medicare Secondary Payer Enhancement Act of 2010 (MSPEA) will improve the system to speed the return of funds to the Medicare Trust Fund and promote settlements.

The MSP system was appropriately intended to ensure Medicare and U.S. taxpayers do not pay for health services when another party has primary responsibility – either as a group health plan, workers compensation plan, or other party with liability for the care provided. Unfortunately, current inefficiencies and problems in the system make it nearly impossible for many parties to determine how much is owed to Medicare. If an entity with MSP responsibility disagrees with Medicare’s after-the-fact calculation, it does not even have a process for appealing their decision, regardless of how inappropriate or flighty it might seem.

The MSPEA departs from the current law in several significant ways. First, MSPEA proposes a “final demand” may be obtained prior to any relevant settlement, judgment, award or other payment. The current law only allows a “final demand” to be made after settlement, judgment, award or any final payment.

Additionally, the new law provides if CMS fails to respond in a timely manner, it may absolve the claimant from any liability and obligation to pay. The change is proposed to help shorten the current process and provide more accurate estimates for all parties.

Alternatively, MSPEA also would allow for a “good faith” estimate based upon billing data of the conditional payment amount to be tendered directly to CMS. In response, CMS would be able to challenge the estimate.

The MSPEA proposes an “extended” right of appeal to “the applicable plan involved, or an attorney, agent or third party administrator on behalf of such applicable plan”. MSPEA also proposes a change of wording under Section 111 which currently reads, “shall be subject to a civil money penalty of $1,000 for each day of non-compliance” to “may be subject to a civil monetary penalty of up to $1,000”.

MSPEA proposes exempting claims under $5,000, imposing a 3 year statute of limitations on the U.S. government and discontinues the use of social security and health identification numbers for reporting with CMS.

Keep your eyes on this spot for progress on passage and implementation of the new law. This article was drafted by our intrepid paralegal-soon-to-be-lawyer Nicole R. Zachary and we thank her for her research and hard work. We appreciate your thoughts and comments on all of it.

Editor’s comment: One of our national clients advised of a recent trend—drug compounding and repackaging to make the simple pharmaceutical process much more expensive. In follow-up to our first article, we note in recent years, compound drugs and drug repackaging have gone hand-in-glove as ways in which WC claims handlers often have no idea what they are paying in handling Illinois workers’ compensation claims. As we have advised on numerous occasions, it is amazing Illinois has a medical fee schedule without a prescription fee schedule. This change won’t happen until Illinois business demands it.

Compounded drugs are hand-made rather than mass-produced, and supposedly tailored to the needs of individual patients. These practices are mainly regulated by the states instead of the federal Food and Drug Administration. The disparities resulting from 50 sets of rules and levels of technical and inspection prowess shouldn’t be allowed to continue. Repackaged drugs are prescription or over-the-counter drugs taken from initial drug producers and repackaged and repriced, usually by physician/clinic dispensers. The cost is from two times higher to twelve times higher. In one study, repackaged drugs accounted for less than a third of all prescriptions but over half of all dollars paid. The concept is especially troubling when one considers the overwhelming majority of the top 20 drugs are generic.

As has been the case for the last several years, the average prescription cost of “compound drugs” is well over the national average. A growing percentage of the providers dispensing compound drugs submit via paper, and many payers have had limited capabilities with adjudicating these bills at the appropriate or allowable rates. While the number of the compound drug paper bills is currently a small percentage of most national payers’ overall prescription volume, the dollars associated with these transactions and the potential savings can be high.

With many states’ workers’ compensation laws, the rules vary regarding how a payer can adjudicate prescription charges. For example, California’s billing regulations require the providers (pharmacies, compound drug companies, physicians, etc.) to submit a detailed list of the individual ingredients in each compound prescription. In addition to significantly overpaying, payers encounter other drug treatment and billing-related shortcomings and challenges when managing compound drugs.

Some of the issues include:

Double billing–compound drugs are not required to have nor do they use standard national drug code (NDC) numbers, and therefore it is difficult to identify when multiple fills for the same prescription are being provided. In addition, some times the compound pharmacy companies also use different third-party biller names, further complicating a payer’s ability to identify this type of situation.

Drug interactions–since individual ingredients of the compound drug are not captured as part of the prescription transaction within the claimant/patient profile, there is a high risk for potential drug interactions (adverse effects) or overdoses when other drugs in a patient’s overall drug regimen are being combined with these compound prescriptions. In addition, the lack of NDC-level detail does not allow for drug utilization edits to occur on these transactions. The only way to solve this issue is to record and adjudicate each individual ingredient within the same pharmacy management system, using the same patient profile and applying the same clinical review edits and rules.

Overbilling–occasionally compound drugs will include the use of higher priced brand name drug ingredients regardless of whether there is a generic alternative available. The lack of NDC detail within a pharmacy management system will not identify these types of issues. There is also a frequency of overbilling compared to the allowable compound production time billing rate.

Therapeutic duplication with different dosage forms–dispensing the same drug in oral and topical form and avoiding the appropriate drug utilization edits since they aren’t using standard NDC numbers.

On the closely related repackaging issue, it is difficult for WC payers to receive accurate prices for repackaged medications, which, by definition, mean a pharmaceutical product is removed from the original container with an original NDC and put into a new container with new quantities, therefore requiring a new NDC, with a new repackaging company label and price for the medication. By its nature, the process can result in inaccurate and overpriced medications. Some states other than Illinois have been attempting to help payers manage the process better, after they have begun to understand the cost-control issues.

We hope to see such prescription and over-the-counter drug abuses end and urge our administrators to get involved to help Illinois business counterattack abuse. We appreciate your thoughts and comments.

Editor’s comment: Everyone in the claims industry knows who they are but what can we do about them? Please understand we cannot name names in an article such as this—to do so would result in an immediate and expensive libel action from each and every doctor and clinic we named. When you run an ongoing medical scam, you are generally very sensitive about “defending your good name” and most of these joints and scamming physicians/chiropractors in Illinois are ready, willing and able to sue at a moment’s notice.

Our favorite story about medical provider abuse came from a Petitioner’s attorney who told us of a clinic in the central part of Chicago—they were sending a bus out to pick up a patient in a distant suburb and bringing him to town for care. The clinic was billing over (or overbilling) $5,000 per long-distance visit. How do we stop this sort of shenanigans?

What as a start–what defines Unstoppable Medical Fraud Machines? Well, every doctor and healthcare giver across the state knows who they are. Some day, we look forward to actually having a doctor on the IWCC advisory boards who will take steps to identify and stop the abuse. Every veteran Illinois WC claims manager rolls their eyes to hear the names of any of the Unstoppable Medical Fraud providers. When a newbie WC claims handler who is unfamiliar with our strange ways in this state sees a bill from one of them, bingo—you note

Most times chiropractors are involved at the beginning or middle of the process;
Lots of times, claimant lawyers are “secretly” involved in referrals
The treatment is never-ending;
These providers’ medium bills are about five-ten-fifty times higher than reputable providers;
The clinics and doctors are relatively immune to utilization review and IME’s;
All of it looks like fraud.

Why are chiropractors involved? From our perspective, the role of chiropractors in this form of medical care is in the larger personal injury setting, prone to overtreatment and overbilling. If you find a chiro that doesn’t do so, save their name and number and send them business. We feel chiropractors have a bona fide role in medical care but, in our view, is should not be an endless one. It is a rare chiropractor we see in the Illinois WC process who believes in a beginning, middle and end to what they provide. And sadly, lots of chiropractors seem prone to medical abuse when they are taking advantage of the strange situation in which they are fronting the cost of care to then try to scam or wedge out payment from a carrier and not the patient.

Why are lawyers involved in too-much-treatment and clear instances of medical fraud? Well, Plaintiff lawyers started doing so on the general liability side to increase what are called “special damages.” Then they seem to miss the fact it usually doesn’t help to have overtreatment on the much more structured WC side—claimants don’t get more money for a soft-tissue strain when there are $50K in medical bills; it creates a headache no one wants.

The problem is many of the overtreating doctors look for Plaintiff lawyers to trade clients—you send me folks who will overtreat and I will send you clients. In the wildly competitive world of Plaintiff personal injury work, it is hard to turn down new business for newbie lawyers, regardless of the problems present. The old-timer lawyers know the math and don’t want to represent clients of overtreaters but the process had been going on for years and won’t stop any time soon.

How do we stop Unstoppable Medical Fraud Machines from the perspective of defense WC claims handlers? Well, officially you can use utilization review and independent medical exams and our clunky medical fee schedule to counterattack. All of those techniques have strengths and weaknesses. We assure all of you the current Illinois WC Commission does generally cut the medical bills of overbillers and kudos to them for doing so. The problems our clients note is you have to then fight and litigate to win and stop the abuses.

We were asked by a client whether you can pay-off a claimant to get them away from an overtreater/overbiller? The answer is there is nothing in the Act or Rules that prohibits it and whatever isn’t illegal is therefore legal. This is a new one for us and we would love to hear your thoughts and comments on it.

Our vote is to get administrators and WC advisory boards that have brains, guts, talent and care about business in Illinois—we hope to some day see someone consider implementing a blacklist for overtreaters and overbillers to stop clear and obvious instances of repeated medical abuse. Until we start to get serious about identifying and stopping overbillers and medical fee abuse, it will not stop and it is a major pain at every level of WC claims handling. Please let us know your thoughts or post them on our award-winning blog.

Editor’s comment: If you read our KC&A Update last week, you learned the parties have reached a class action settlement of the dispute about the Surcharge you may have overpaid in 2003-9. Your organization may be able to get substantial monies back with minimal effort on your part. Shawn R. Biery, Gene Keefe and the attorneys and staff at Keefe, Campbell & Associates are happy to handle your claim for free, if you will simply fill out and forward the forms to us. We have already submitted a number of applications for refund and more requests continue to come in every day.

Preliminary approval for settlement of the lawsuit has been provided by the Circuit Court of Cook County. The sum of $3,300,000 now resides in a Protest Fund and will be placed in a claim fund to be distributed to class members who can support their claim for repayment. Judicial approval of the payout may be as soon as June 15, 2010.

The support for claim can be made with documentation of canceled checks, invoices showing the surcharge or other proofs of payment as long as they make a claim for repayment during the claims period in the appropriate manner. The amount of refund will be limited to 45% of the Surcharge paid between July 1, 2003 to June 30, 2004 and 10% of the Surcharge paid July 1, 2004 to June 30, 2009. The current proposed settlement agreement can be seen on the web at http://www.state.il.us/agency/IIC/Chamber-Settlement Agreement.pdf and the preliminary approval order can be found on the web at http://www.state.il.us/agency/IIC/Preliminary approval order.pdf.

This was brought to all Illinois employers by our Illinois State Chamber of Commerce. We urge our readers to continue to support State Chamber President Doug Whitley and the Illinois State Chamber of Commerce that is clearly out on point in trying to reform workers’ compensation in this state.

Editor’s comment: In less than ninety days, our former Governor is going on trial for various counts of bribery and extortion while in public office. There is no indication he will cop a plea and quietly accept his medicine. Illinois voters are going to watch what we feel is a crooked politician do everything he possibly can to wriggle off the hook—the tawdry and embarrassing legal battle will lead right up to the November state-wide election. We don’t feel voters will be amused by the spectacle.

At the same time, this Wednesday, our current Governor is going to tell Illinois voters he is facing a budget deficit of well over $13 billion dollars! He is going to face the situation head-on and demand the legislature dramatically raise our taxes once again. We don’t feel he has the guts or drive to make the changes needed to dramatically cut costs now or in the future. Trust us, Illinois voters apparently don’t mind their money being squandered on our hilariously poorly run state government in Illinois unless and until they find out more taxes are inescapably due. When that happens, history tells us they generally rise up and knock out any politician who supports new taxes. One way or the other, this current administration may be called to task for about a decade of waste and corruption and shown the door.

All of this is pointing toward a Republican rebirth at the state level this fall. Those Republicans are already asking tough questions. We are certain to want to provide guidance and answers that are in the best interests of our clients and the broad base of Illinois employers struggling to compete in a very competitive national and international economy.

Numerous sources indicate workers’ compensation costs in Illinois have steadily risen to be among the highest in the nation. All of our readers and everyone who writes an email reply about workers’ comp costs routinely advises our fair state is out-of-whack with our sister states and the rest of the country. The collective angst of Illinois business is being heard more than ever before. There are various bills now proposed by our state legislators to change the Act and even the Illinois Workers’ Compensation Commission’s system of dispute resolution itself. We also point out administrative change will be inescapable.

This all begs the main question that keeps coming back; what should be changed and how?

The claim the “lawyers have caused the problems” is a flippant, easy answer but it does not address any of the real problems from the perspective of Illinois business. In fact, the Illinois Workers’ Compensation Commission digests over 50,000 cases per year. The attorneys who work within the system are, on the whole, professional and well-versed in the law and practice. Attorneys on both sides represent their clients well. We feel the main cost associated with workers’ compensation claims in Illinois do not stem from litigation; in fact, litigation costs are a very small fraction of the overall cost of claims.

For this reason, the promulgation of an alternative dispute resolution system (ADR) would again do nothing to address some of the real changes that would benefit Illinois business while still protecting injured workers’ rights. Point in fact, the Commission structure already is “alternative dispute resolution” as it is an alternative to the much more ungainly and slow civil court system. The IWCC is comparatively streamlined and works remarkably well when veteran attorneys for both parties are working a case.

As an example, our firm was recently assigned a file on July 14, 2009 with a serious medical and accident dispute. The parties obtained expert opinions, took depositions, tried the case and received a decision on a 19(b) hearing by October 20th. Following that model, this established system can and does work well, regardless of what the critics say. Does litigation always proceed with such economy? Of course not,but when there are delays, it is most often due to the need for further information/fact gathering, which the arbitrator requires to make an informed decision.

If another version of ADR is inserted under the current Workers’ Compensation Act, what changes? Assuming the same statutory rights are protected and the body of case-law that has developed over the past decade or so is still followed, it is our impression that nothing is accomplished by the creation of ADR. Implementation of any such binding arbitration is similarly duplicative, as Section 19(p) of the act has the equivalent of binding ADR with an option for the parties to conduct a one-time binding arbitration which is not appealable to the Commission or any Court. Therefore, if the parties desire such finality without recourse to review an opinion, they are already free to do so under the current Act.

All right then; we save the Commission itself, but what do we change to save Illinois business and bring our WC costs into line?

We offer three proposed changes to the Act which would make Illinois competitive again with our sister States while still protecting workers’ rights (at least in the workers’ comp arena).

Insert a new legal standard for compensability of an “aggravation of a pre-existing condition”.

One of the most frustrating aspects of our system from the employer’s perspective is when an individual has a simple twisted knee claim without blunt trauma or tears, yet due to an advanced degenerative joint, is a candidate for a knee replacement. When the doctors testify the sprained knee is “a cause” of the symptoms, the floodgates open and the employer, through no fault and without ability to prevent such an injury, must pay hundreds of thousands of dollars for joint replacement, TTD and wage differential benefits when such workers are deemed unable to return to work.

We propose a statutory requirement as follows: “in the event a work accident reveals pre-existing degenerative medical conditions, the work accident must be the primary aggravating factor which creates the need for treatment and any subsequent disability for the continuation of benefits under the Act.”

Cap wage differential and permanent total disability claims at 10 years of benefits or 520 weeks.

Again, Illinois is the most expensive State in the Union due to such lifetime claims that almost no state provides. We will never be competitive as a state in terms of attracting and keeping business unless such costs are reined in. Workers’ compensation is a no-fault system of benefits that provides 100% medical cost coverage and wage replacement while disabled. Most cases settle based on the traditional “scheduled” loss of the respective body part. For more severe claims, a reasonable “safety net” for employees is to provide a decade of wage replacement benefits. At our high benefit rates, this would still be relatively high compared to other States, but nonetheless better than the current windfall of lifetime benefits. As part of this change, we propose that vocational assistance must continue to be offered to candidates for placement. However, vocational assistance should be suspended after 6 months, with any wage differential based on the median income earning potential pursuant a labor market survey. In other words, claimants don’t get to allege they are “odd-lot” permanent total disability candidates simply because they cannot get hired within their restrictions.

Pay medical bills in workers’ comp at what is paid in the group health-care arena.

Finally, this one is a no-brainer of the highest level. Why have non-parallel systems for Illinois business where doctors and other health care givers are reined in by Blue Cross/Blue Shield or Aetna on the group health side but on the workers’ comp side, medical bills run completely batty? No one has any idea how to rein the abusers and overbillers in on WC—we recommend mandatory UR as a path. In our view, the Commission provides nothing but confusion and consternation when they implement it. Let’s make it mandatory or simplify it but start to come in with true guidelines to the benefit of injured workers and their employers alike.

We can’t tell you we have all the answers but we are sure we know the right questions. Please let us know your thoughts and ideas. This article was written by John P. Campbell, J.D. and Eugene F. Keefe, J.D.

Editor’s comment: In our view, Illinois is unquestionably the worst managed of all fifty of the United States. In beautiful Cook County, we clearly have the highest sales tax of all sales taxes in the country. Our local real estate and state income taxes are already staggering and certain to spike, as government spending spirals.

Despite record-level tax loads next year, the State of Illinois is expected to have a budget deficit equivalent to 20% of the approximately $60 billion dollar budget. Illinois will owe $12,000,000,000.00 that we don’t have and won’t collect in taxes or fees. Right now, about $5 billion in state bills remain unpaid and are well overdue. Whoever gets the Governor’s job is going to have a herculean task in front of them. Assume it may be almost impossible for that person to do what needs to be done and remain popular to anyone but his dog.

Over the last fifty years, Illinois voters have shown abysmally bad judgment when voting. We elected four Governors who went to jail for one thing or another. One former Governor who is in jail right now, admitted to some of the blame for not properly licensing truckers and had a trucker who never got a real CDL improperly tie down an angle iron causing it to fly under a minivan full of kids—in the resulting fire, a number of little children were tragically burned to death.

The fifth potential felon to be elected by Illinois voters to our Governor’s mansion is currently out on bond and continues to insist on making a complete fool of himself in the media. This past week, we read the new indictment filed by the U.S. Attorney for the Northern District of Illinois—the purpose of the modified indictment was to avoid a U.S. Supreme Court ruling that may technically end some of the federal laws this former Governor was charged with and supplanted them with new charges of bribery and extortion. If you read the new indictment online, you may note the worst of his federal charges clearly have to be the allegations he sought to extort money from a children’s hospital that saves the lives of hundreds of little babies every year.

The recent state primary election has to be the stuff of a Saturday Night Live® comedy script. It is our understanding the Democratic Party candidate chosen for Lieutenant Governor admitted to scandal after scandal in his past. His background and training for the political post was being a successful pawnbroker and having several million to invest in his campaign. It is almost impossible to imagine the voters had done any research on him and simply liked his name. He has now withdrawn and isn’t supposed to recover the millions he spent to get the nod.

We also strongly support merit-selection of judges and justices of the reviewing courts and not leave that process to apathetic, disinterested and confused voters. Elections and voting for judges is tantamount to buying judicial opinions for those who understand our political structure. It is comical to consider our Illinois Supreme Court waited until two days after the primary and struck down the medical malpractice caps designed to keep doctors in our state. If you regularly read this Update, you understand it is our reasoned view the Illinois Trial Lawyers Ass’n strongly supports the candidates for the Supreme Court who may concomitantly support the policies and goals of ITLA. Right now, ITLA doesn’t want malpractice caps and, for the third time, they got them knocked out by our highest Court. Please assume all neurosurgeons south of Springfield will again move to Missouri. This may result in no one being able to treat a closed head injury in the bottom-half of Illinois—all such patients will all be med-evac’d to St. Louis or Terre Haute.

The only way the Illinois State Medical Ass’n can trump ITLA is to have Illinois doctors start to regularly pony up more cash to get new justices who might find malpractice caps to be constitutional. We don’t feel that is the way judicial rulings should occur but, as a wise man once said, “you can’t take the politics out of politics.” We can if we would go to merit selection and de-politicize the selection of judges and justices.

Going back to government, it is clear to us that we need a city manager-type of government at all levels. If you need more information on how it works, send a reply. We truly feel Illinois would be much better off with professional managers who have no stake in raising money as part of the government decision-making process. And we truly feel the Governor and legislature should simply provide direction and set policy for the professional managers. We feel politicians who are mostly lawyers can’t and shouldn’t try to run budgets in the range of $60 billion dollars.

The reasons we don’t feel voters can ever do a solid job is patently clear in several spheres:

No one is voting and apathy is at an all time high.

Voters are basically giving up the antique concept—less than 1 in 5 eligible voters voted in this month’s primary;

The folks who are voting and simply going by what they see and hear with very little knowledgeable research;

With all the monster input of the Internet Age, it is truly demanding to have to research literally hundreds of legislative and judicial candidates and concomitant issues.

How does workers’ comp point in this direction? Here are just a couple of the anomalies.

First, Doug Whitley, the president of the Illinois State Chamber and one of the sharpest folks in our state wrote a brilliant analysis of how Illinois can dig out of the monster budget hole we have put ourselves in. One of his biggest issues is the wildly generous state pensions that wait for all state workers at the end of any reasonable tenure in government. What Doug may not know is workers’ comp provides hundreds of retired state workers with what is effectively a “double-pension!!”

If an Illinois state worker is adjudicated totally and permanently disabled or entitled to wage loss differential benefits and also gets an Illinois state pension, they get to keep both without any offset. The current cost of this benefit to eligible claimants is well into the millions. If you don’t understand what this means, state workers who qualify for both receive more money from the two pensions than they could have possibly received while working—the state pension is about 60% of the highest wage at the end of their career. The combined total and permanent disability award is 66-2/3s of their average weekly wage on a tax-free basis for life! The Workers’ Compensation Commission is now rabidly focused on insuring such workers always get COLA increases. In total, such workers receive about 123-2/3% of their highest income while employed by the state. All of the money comes from Illinois taxpayers. All Illinois would have to do to end this craziness is input an offset so state workers don’t get both. We are confident it will be a long time before anyone even understands this largesse, much less acts to end it.

Second, another facet of Illinois State, Cook County and City of Chicago government is all three governments run workers’ comp programs that are routinely penalized and/or claimant attorneys are awarded their attorney’s fees for bad or clearly incompetent management of workers’ compensation benefits by the applicable government claims handlers. We consider this a scandal which remains under the radar of the various news media—it simply isn’t a racy enough topic but try to imagine how nutty and incongruous it is for an Illinois arbitrator who works for the state issuing an award penalizing a different state agency for their incompetence. All of the money comes from taxpayers; all of the additional benefits go to injured state workers. We truly feel workers’ compensation claims and legal handling of all state, county and local government bodies should be competitively outsourced for bid and the parties getting the work have to be responsible to the voters for their mistakes. Our only problem is nothing in Illinois politics is every competitively bid—someone’s-brother’s-cousin’s-uncle always seems to get the nod.

Third, there is another anomaly that would make any business or claims manager laugh—the City of Chicago and State of Illinois retain outside defense counsels to represent them in the defense of some of their workers’ comp claims. We assert no one on the planet can tell an innocent bystander how to get picked to represent the City of Chicago in handling such claims—we have asked both major Chicago newspapers to investigate and they both gave up. We are told there is a fat guy who is the gatekeeper for a well-known Chicago alderman. If you start to pony up lots of cash to the alderman, you may be considered for the work in a couple of years. There are no guarantees.

On the state side, there is a state medical institution that outsources their WC defense work. The law firm that gets the work in northern Illinois has one defense client—they are a very successful Plaintiff personal injury firm. The partner who gets the work had a relative, an uncle or father-in-law in the right office in Illinois state government. When that relative recently left state government, we made inquiries to see if the work might be coming up for bid. We were told there had to be an RFP and it would be considered to be let in 2012 or 2013. Sure. We have never seen a prior RFP for such work and have no idea what magical event might occur for the work to again become a subject of open bidding.

All in all, we truly feel there needs to be substantial changes at all levels of government in this state. Gosh only knows if we have the guts and the brains to do so. Please let us know your thoughts or post them on our award-winning blog.

Editor’s comment: The world wasn’t safe while the legislature was in session. Our “liberal” Democratic House, Senate and Governor drop lots more regulations on us. Though 2009 was dominated by a state budget crisis that continues to have multi-billion dollar deficits, and they have not really addressed ethics reform in government, lawmakers approved hundreds of other new laws for Illinois’ citizens to adapt to. Most of them take effect at the midnight on Thursday when the New Year starts. Some legislative changes will hit drivers and others directly, but others are more obscure.

Lawmakers’ bent on keeping people from texting while driving enacted a law this year and it takes hold Thursday at midnight. Drivers caught emailing, “tweeting” or texting behind the wheel can be pulled over and ticketed for the offense. Please assume if an Illinois police officer now wants to stop anyone, they will be able to claim they thought you were texting or emailing.

“Bluetooth” or hands-free devices may be much more popular in Illinois. In addition to not texting, drivers can now be ticketed for talking on the phone without a hands-free device in a school or construction zone starting Jan. 1. The best way to avoid this is to find a way to talk without putting the phone to your ear.

A separate law increases the fine of speeding in a school zone by $5 and sends the extra money to help schools. The fine for not yielding to a pedestrian in a school zone goes up $50.

Trucking companies traveling in or through Illinois will be happy to hear semi-tractor-trailer trucks will now be able to go 65 mph on rural interstates Jan. 1 because of a change in law. However, it will take time for the state to take down the signs that continue to hold truckers to 55 mph.

As part of the state’s plans to help out Illinois’ road builders and the struggling construction industry and build more roads and bridges, the cost of registering a car goes up $20 in 2010. Therefore, a new license plate sticker will cost $99 instead of $79. We have already gotten January renewal bills with the higher cost.

For you outdoorsy types, the cost of hunting and fishing will go up to in an effort to help the state’s cash-strapped outdoors programs. On Jan. 1, the cost of a fishing license goes from $12.50 to $14.50. A deer permit goes from $15 to $25 and hunting license fees rise from $7 to $12.

New laws that we didn’t truly need include naming Feb. 5 Adlai Stevenson Day in Illinois. Adlai Stevenson was Governor of Illinois in the 1950s, unsuccessfully ran for President against Ike and later served as a United Nations Ambassador. The day honoring him won’t get people off of work but official state calendars will note the day.

And last but not least, starting on Friday morning, American flags flying on public property in Illinois, such as outside government buildings, will have to be made in America. No more “Made in China” U.S. flags. A company in Rock Island, Regalia Manufacturing Co. makes American flags. You can buy an unlimited number of Illinois-made U.S. flags, banners or other “regalia” by contacting them online at http://regaliamfg.com/. U.S. flags don’t have to be replaced immediately but after the old ones wear out, new ones have to be made in the U.S.

Now, let’s hope they can make sense of that budget thing. Please send your thoughts and comments.

Editor’s comment: We are starting to see more and more assignments come in with a truly anomalous claims issue—claims that have been

“Held” by the adjuster for weeks, months and years prior to being sent to defense counsel;

Substantial TTD and medical bills have been paid; and

No true accident investigation has been performed with interviews conducted or forms completed;

The initial treating medical records have not been received and reviewed.

Please note Illinois is not a state that allows a great deal of pre-trial discovery in a meaningful fashion. The idea is the employer in Illinois gets to investigate what happened following the report of injury and medical records are out there for both sides to review—you don’t have to pay medical bills blindly in Illinois, the statute says you get to look at the records, coding and other documentation also.

So we all have some tools at our disposal to see if the claim is either questionable or bona fide. As we have told our clients, readers, Arbitrators/Commissioners and law students for years, the matrix every workers’ compensation hearing officer, attorney, claims handler, participant or risk manager has to review is to compare the initial report(s) of accident with the first medical history or histories to see if they “match” in a meaningful way. If the accident investigation and medical records don’t align, benefits shouldn’t be paid until the questions that arise get answered.

The problem we see across the country is claims adjusters are under the gun. They are handling lots and lots of files, many are at record-high levels to justify their jobs and pay in this demanding economy. The problem they face is it takes a little or a lot of time to get accident investigation protocols completed and medical records in their files. It is tough to match all of it up and make sense out of what they are doing on a file by file basis. Most veteran claims adjusters know the easiest way to quiet down a demanding file is to just take the initial report and just start paying benefits—by doing so, claimants and potentially their attorneys will stop calling/crabbing and sending penalty/fee petitions and making threats of one sort or the other. The problem this causes is files some times get accepted and lots of benefits paid with very minimal accident information and late or lacking medical documentation.

The problem for the defense attorney who later gets the file is multi-layered. In our experience, claims handlers don’t like to be “questioned.” They know if the defense attorney starts to ask pointed questions about the initial determination to simply start paying benefits without a minimal accident investigation; it may put the adjuster in a bad light. The defense attorney knows the claims adjuster usually handles the spigot that sends files—if you tell the adjuster the matter needs to be more fully investigated, they can go to a less aggressive attorney who won’t roil the waters, no matter how poorly the file has been initially set up. The problem for the corporate risk manager or insurance broker with a demanding account is you may be paying a lot of money on a claim when your claims staff and attorneys don’t have the very basic defense tools in the file—you aren’t sure an accident happened or if the medical care your adjuster is paying for relates to the claimed event!!

So what are the three Keefe, Campbell Claim-Acceptance Rules? We recommend the Illinois and possibly U.S. claims industry demand three simple things on every litigated claim or defense assignment. First, each file has to have some definitive accident report in it. The best of all worlds is a hand-written accident investigation report filled out by claimant in their own words and language and signed. If they can’t fill it out due to an inability to write, audiotape or videotape it. If union rules or other administrative issues block a statement from the injured worker, our first rule requires a handwritten accident investigation report completed by the supervisor to whom the event was initially reported. For insurance/risk managers and insurance brokers who watch claims handlers, you shouldn’t allow any adjuster to pay benefits without something other than a call from the account saying “claimant hurt at work.”

If the claim goes litigated early, what do you do about getting an accident investigation report filled out when claimant is represented by counsel? Tell the claimant attorney you have to have the accident investigation report and you are willing to interview their client on the phone with counsel on the line. Tell them your handling rules require it and you can’t pay benefits without a completed accident investigation report. While we don’t mean to talk for Illinois Arbitrators, we assure you most of them support the concept that an injured worker has to preliminarily cooperate with claims adjuster before you start paying lots of benefits. They will not require you to pay blindly.

Next, the claims handler has to have the initial medical treatment records; whatever they might be. As part of this process, we recommend having every injured worker sign a HIPAA-compliant medical release. After you have the signed release, if you don’t know where claimant went for care, ask them! If you know where claimant went for care, call and fax the HIPAA-compliant release and ask for the initial treating records. Please always remember the medical course starts on the date of loss—if they don’t get care for some time after the event, it is always a red flag—it doesn’t mean you can always deny the claim but it is always something to further review and consider. Please also remember to CYA—if you don’t have initial treating records and you aren’t paying benefits, write either claimant or counsel early and often to tell them where you are at in trying to get them. Make clear in all correspondence to tell them you follow the KCCA Rules and you can’t and won’t pay benefits until you have them.

Third and last, when you have an accident investigation report and the initial medical records with a clear medical history—read and compare them! It sounds simple but we get lots and lots of claims which indicate the claims or risk manager did not take these three simple steps. If the accident investigation report and initial medical history match, you can and should pay benefits. If they don’t match, you don’t and shouldn’t pay benefits. Sounds simple, doesn’t it?

We point out to everyone in the WC claims industry, if you send a file to defense and they aren’t asking these questions and confirming analysis of this matrix, they aren’t doing their job. If these three steps aren’t followed, you are almost certainly paying benefits totally in the dark—you and your defense counsel won’t be able to do most of the important claims steps such as fighting a phony accident, targeting MMI or return to work. When we audit claims files for our clients and potential clients, this is the first thing we look for—we are amazed at how many times it is missing. If it isn’t in the file early, you need to try to “rebuild” it later at usually a major disadvantage due to the passage of time. We recommend everyone look at your major litigated claim files to see if this matrix is present or let us do it for you in an audit.

If you need an accident investigation form, send a reply. If you need/want our recommended questions to interview an injured worker, send a reply. If you want a copy of our HIPAA-compliant release, send a reply. All of these documents are offered at no charge. And don’t hesitate to post your thoughts on comments on our award-winning blog.