WORKERS' COMP BILL SESSION'S BIGGEST ACHIEVEMENT TO DATE

On Wednesday, March 10, the Missouri Senate completed six days of debate and work on Senate Committee Substitute for Senate Bill 251 (SCS for SB 251), the reform of workers' compensation. It was an extraordinary process of a deliberative body wrestling with an extremely complex and difficult subject.

Over the last year, one overwhelming message got through to all legislators of both parties. That message is that Missouri's system of workers comp is in crisis, and that this is a crisis that threatens the survival of businesses and the jobs they represent. Workers comp has not been working, neither for employees nor for employers. It is preeminently a jobs and economic development issue for our state.

For me, it was an honor just to participate and take part in the deliberations. One of my seven committee assignments is the Judiciary Committee, which is where this reform measure was first referred and where hearings were held, often far into the night. Three weeks ago, we passed the measure out of committee for consideration by the entire body as a whole. I hasten to add that I'm no workers' comp expert, but we got the best witnesses we could and listened carefully to all sides.

After an unusually high 29 amendments were offered in floor debate, the senate adopted 24 of them, gave first-round approval and sent the bill to the House. I believe SCS for SB 251 is an excellent stab at reforming workers' comp and easing the crisis in Missouri.

What follows is a summary of key amendments to SCS for SB 251:

SA 1 Establishes competitive premium pricing for workers' compensation insurance based on premiums. The pricing of workers's comp insurance and the determination of competitiveness would be regulated by the director of the Department of Insurance. Effective date is Jan. 1, 1994.

SA 3 Establishes a state mutual insurance company to be in operation by March 1, 1994. The company will be able to write workers' compensation insurance for any employer, but it must give preference to Missouri employers that have an annual premium of $10,000 or less. Also, the amendment changes the premium tax mechanism for support of the Division of Workers' Compensation Administrative Fund.

SA 4 The Department of Insurance must collect claims information necessary to determine and analyze costs of the system. The department will survey a statistically significant sample of health care providers to collect specified data.

SA 6 Beginning January 1, 1994, the director of the Department of Insurance shall be responsible for administration of the assigned risk pool.

SA 7 Provides for a more restrictive definition of the terms "injury" and "accident" as they relate to workers' compensation. Contains language establishing that to be compensable, such injuries must be substantially work-related.

SA 8 Provides for interest charges to be paid from the date due, not from the date of the last appellant decision.

SA 9 Allows insurers to sell group policies for workers' compensation insurance.

SA 10 Requires reports of injuries to be filed with the division only for accidents resulting in medical costs of more than $500.

SA 11 Removes a section from the bill that allows for reduction in benefits for alcohol use if alcohol in the blood was 0.10 or higher at the time of the injury.

SA 12 Sets a disability threshhold to be met for claim access to the Second Injury Fund. This will make it tougher to get into the much-publicized Second Injury Fund to receive settlements.

SA 13 Provides more restrictive standards for compensability for an occupational disease.

SA 15 Lessens the use of depositions in workers' compensation cases.

SA 16 Establishes a program for use of managed care organizations to help contain medical costs.

SA 19 Specifies certain fraudulent activities relating to workers' comp claims and sets penalties. Contains tough fraud language.

SA 23 Establishes a "Workers Compensation Determination Review Board" whereby employers can appeal code classifications and rate modifications.

SA 24 Claim mediation by prehearing conference and review of Administrative Law Judge distribution and equipment needs by the Joint Commission on Judicial Resources.

SA 25 If a claim is denied, an employee may appeal the employer's decision with an administrative law judge hearing within 30 days of the request. If it is found that the denial was unfounded, the employee can get their attorney fees paid by the employer or insurer. There is also a $15 per day penalty for up to 100 days for not paying benefits when due.

SA 26 Requires that any out-of-state contractor, in the construction industry, show proof of workers' compensation coverage prior to obtaining an occupational or business license.

SA 28 Reestablishes the Workers' Compensation Labor/Employer Advisory Committee established by last year's legislation to recommend reforms to the legislature. Committee will continue to meet and make recommendations for improving the system.

SA 29 Third party recovery employer recovery/subrogation reduced by employee's percentage of comparative fault.

Is this a perfect bill? Far from it. Is it the best we're likely to get this legislative session? Undoubtedly. Most observers who have closely scrutinized SCS for SB 251 believe it's a good reform measure, and most are heartened that we were able to produce a comprehensive reform measure that did this much.

If you have thoughts and concerns that bear on this or any other state issue, you may contact me at:

Room 328

State Capitol

Jefferson City, Missouri 65101

ph. (314) 751-2455