June, 2016
By Anthony J. Caruso, Jr., Esq.
Workers’ compensation is a major cost factor in doing
business for most employers. Therefore, the economy and business necessity require
that workers’ compensation costs be closely scrutinized through employers’
active participation in the system.
Below are several areas that affect Illinois workers’
compensation cost factors. Illinois employers should analyze and review them as
applicable to their own companies.
Safety/Accident
Prevention
The best method of controlling workers’ compensation claims
is to prevent accidents from happening. Most safety experts agree that a
comprehensive safety program is worth the effort in reduced workers’
compensation costs.
Safety programs should do the following:
- Stress a clean and safe work environment – free of harmful conditions and hazardous chemicals;
- Utilize in-house and outside safety experts, ergonomists and insurance consultants;
- Educate all employees as to the proper procedures for the use of equipment;
- Eliminate any repetitive task or individual act likely to cause injury;
- Provide preventive appliances such as wrist splints and back supports along with ergonomically-designed work areas;
- Comply with all Occupational Safety and Health Act, federal and state regulations.
- Today, the key is prevention in the reduction of unsafe acts and Illinois workers’ compensation claims with the associated costs.
Employer/Employee
Relations
A happy employee is probably less likely to file a workers’
compensation claim than a disgruntled one. Studies have shown that good
employer/employee relations may reduce the number of nuisance or questionable
workers’ compensation claims. The Illinois employer’s approach should be to:
- Fairly compensate legitimate claims – strenuously defend questionable ones;
- Communicate continually with the injured employee as to his/her well-being, medical treatment and return to work status;
- Arrange for the prompt payment of the employee’s lost time benefits and medical bills, if justified.
Accident Reporting
and Investigation
OSHA and Illinois’ workers’ compensation laws require
employers to report workers’ compensation injuries and occupational diseases in
a timely manner. The reporting process mandates some type of employer
investigation. Thus, the nature and extent of the employer’s investigation may
determine if an alleged injury is compensable.
An accident reporting and investigation system should
include:
- Notice to all employees as to the accident reporting procedures and the proper chain of command for notification to supervisors;
- Designation of an appropriate individual to gather and freeze the facts of an alleged injury (i.e., securing witness statements);
- Monitoring procedures as to the claim’s status with the workers’ compensation carrier or representative and the appropriate state agency.
Medical Benefits
The employer and the employee have rights and
responsibilities as to medical benefits under Illinois workers’ compensation
laws.
The Illinois employee’s right to choice of treating
physician or doctor in the chain of referral is limited. To reduce medical
costs related to compensable accidental injuries/occupational diseases, the Illinois
employer or its representative should do the following:
- Attempt to direct the injured employee for treatment by the approved company medical provider. This allows the employer to control indirectly the extent of medical care and cost;
- Obtain second opinions by qualified physicians when surgery is recommended;
- Secure independent medical evaluations of the injured employee when the medical care seems excessive as compared to the alleged injury;
- Arrange for extensive hospital and doctor bills to be audited for necessity and reasonableness.
Lost Time/Permanent
Disability
In Illinois, an employee is entitled to compensation for
lost time incurred as a result of workers’ compensation injury. In addition,
the injured employee is entitled to compensation for permanent disabilities.
Employers may regulate employees’ entitlement to these benefits through the
following approaches:
- Establish a light duty/restricted work program if required by business necessity, and if it complies as a reasonable accommodation under ADA;
- Consider using vocational rehabilitation experts;
- Secure the injured employee’s return to work with another employer when appropriate;
- Obtain an independent medical evaluation of the injured employee to minimize any compensable permanent disabilities.
Insured v.
Self-Insured
In Illinois, employers have an obligation to pay workers’
compensation benefits to injured employees. This obligation may be paid
directly by an employer on a self-insured basis or by a workers’ compensation
insurance company.
Illinois allows employers to be insured or self-insured
(individually or in a pool/trust of self-insured employers). An employer should
consider these factors in selecting insured versus self-insured status:
- In a competitive market state, secure quotes from your insurance broker for a number of workers’ compensation carriers;
- Make sure the party underwriting the risk has assessed your employees in the proper job classifications and rates in determining the insurance premium;
- Arrange for an analysis of your company’s potential for self-insured status. Check out self-insured pools/trusts for your industry.
Illinois Legislative
Update: Workers’ Compensation Reform
Illinois Governor Bruce Rauner has designated workers’
compensation reform as a key element of his business reform package. To date,
no reform has taken place during the state’s budget impasse.
Questions?
Contact Attorney Anthony J. Caruso, Jr. of Wessels Sherman’s St. Charles office
at (630) 377-1554 or via email at ancaruso@wesselssherman.com
