LRB-3926/1
GMM:cjs:rs
2011 - 2012 LEGISLATURE
January 30, 2012 - Introduced by Senator Wanggaard, cosponsored by
Representative Ballweg. Referred to Committee on Labor, Public Safety, and
Urban Affairs.
SB409,1,8
1An Act to renumber and amend 102.29 (1);
to amend 16.865 (4), 20.445 (1)
2(t), 102.03 (4), 102.11 (1) (intro.), 102.13 (2) (c), 102.16 (2) (d), 102.17 (4), 102.35
3(1), 102.43 (5), 102.43 (7) (b), 102.44 (1) (am), 102.44 (1) (b), 102.44 (1) (c), 102.49
4(1), 102.56 (1), 102.56 (2), 102.59 (1), 102.61 (1), 102.61 (1g) (b), 102.61 (1m) (c),
5102.61 (1m) (d), 102.61 (1r) (c), 102.64 (2), 102.66 (1) and 102.66 (2); and
to
6create 102.43 (5) (c), 102.65 (3) and 102.65 (4) of the statutes;
relating to:
7various changes to the worker's compensation law, granting rule-making
8authority, and making an appropriation.
Analysis by the Legislative Reference Bureau
This bill makes various changes to the worker's compensation law, as
administered by the Department of Workforce Development (DWD).
Payment of benefits
Maximum weekly compensation for permanent partial disability.
Under current law, permanent partial disability benefits are subject to maximum
weekly compensation rates specified by statute. Currently, the maximum weekly
compensation rate for permanent partial disability is $302. This bill increases that
maximum weekly compensation rate to $312 for injuries occurring before January
1, 2013, and to $322 for injuries occurring on or after that date.
Vocational rehabilitation. Under current law, an injured employee is
entitled to receive compensation for temporary disability while the employee is
receiving vocational rehabilitation services under the federal Rehabilitation Act of
1973. If, however, the injury causes only partial disability, the employee's weekly
indemnity is the proportion of the weekly indemnity rate for total disability that the
actual wage loss of the injured employee bears to the injured employee's average
weekly wage at the time of injury.
This bill provides that compensation for temporary disability on account of
receiving vocational rehabilitation services shall not be reduced on account of any
wages earned for the first 24 hours worked by an employee during a week in which
the employee is receiving those services, but that if an employee performs more than
24 hours of work during a week in which the employee is receiving those services, all
wages earned for hours worked in excess of 24 during that week shall be offset
against the employee's average weekly wage in calculating compensation for
temporary disability. This provision, however, does not apply after the last day of the
24th month beginning after publication of the bill.
Under current law, an injured employee who is receiving vocational
rehabilitation services is entitled to payment for the expense of travel to receive those
services and, if the employee receives those services elsewhere than his or her place
of residence, payment for the expense of maintenance during his or her
rehabilitation.
This bill provides that an injured employee who is receiving vocational
rehabilitation services is entitled to payment for the cost of tuition, fees, and books
required for the employee's vocational rehabilitation program.
Disfigurement benefits. Under current law, DWD may allow compensation
for a permanent disfigurement that occasions potential wage loss, except that if an
employee who claims compensation for permanent disfigurement returns to work for
his or her employer at the time of the injury at the same or a higher wage, DWD may
not allow that compensation unless the employee shows that he or she probably has
lost or will lose wages due to the disfigurement.
This bill prohibits DWD from allowing compensation for permanent
disfigurement for an employee who returns to work for his or her employer at the
time of injury, or who is offered employment with that employer, unless the employee
suffers an actual wage loss due to the disfigurement.
Work injury supplemental benefit fund
Introduction. This bill makes various changes relating to the work injury
supplemental benefit (WISB) fund administered by DWD with the assistance of the
Department of Justice (DOJ), which is a fund that is used to pay supplemental
worker's compensation to employees with permanent total disability, additional
death benefits to the children of a deceased employee, additional worker's
compensation to an employee with permanent partial disability who incurs further
permanent disability, and worker's compensation when an otherwise meritorious
claim for occupational disease is barred by the statute of limitations, when the status
or existence of the employer or worker's compensation insurer (insurer) cannot be
determined, or when there is otherwise no adequate remedy.
Traumatic injuries. Under current law, an application for worker's
compensation that is not filed within 12 years from the date of the injury or from the
date that worker's compensation, other than for treatment or burial expenses, was
last paid, whichever is later, is barred by the statute of limitations, except that in
cases of occupational disease or in cases of traumatic injury resulting in the loss or
total impairment of a hand or any part of the rest of the arm proximal to, that is,
toward the trunk from, the hand or of a foot or any part of the rest of the leg proximal
to the foot, any loss of vision, any permanent brain injury, or any injury causing the
need for an artificial spinal disc or a total or partial knee or hip replacement
(traumatic injury) there is no statute of limitations. In cases in which there is no
statute of limitations, benefits or treatment expenses for occupational disease
becoming due 12 years after the date of injury or after the date that compensation
was last paid, whichever is later, are paid by DWD from the WISB fund and benefits
or treatment expenses for traumatic injury becoming due 12 years after the date are
paid by the employer or insurer.
The Wisconsin Supreme Court recently held, however, in Society Insurance v.
LIRC, 2010 WI 68, 326 Wis. 2d 444, that retroactive application, that is, application
to injuries occurring before April 1, 2006, of the provision holding employers or
insurers liable for benefits or treatment expenses for a traumatic injury becoming
due 12 years after the date of injury or after the date that compensation was last paid,
whichever is later, constitutes an unconstitutional impairment of contract and
violation of due process rights. Accordingly, this bill provides that the WISB fund,
rather than the employer or insurer, is liable for such benefits or treatment expenses
only if the date of injury or last payment of compensation, other than for treatment
or burial expenses, whichever is later, is before April 1, 2006.
Third-party liability. Under current law, worker's compensation is the
exclusive remedy for an employee who is injured while performing services growing
out of and incidental to his or her employment, except that, subject to certain
exceptions, an injured employee may claim worker's compensation from his or her
employer and bring an action in tort against a third party for damages by reason of
the injury. Current law also permits an employer or insurer that has paid or is
obligated to pay worker's compensation for an injury to bring an action in tort against
a third party and permits DWD to bring such an action, if DWD has paid or is
obligated to pay a claim for an injury from the uninsured employer's fund. When a
third party is found liable for damages by reason of an injury, the employer, insurer,
or, if applicable, the uninsured employers fund is entitled to reimbursement from the
proceeds collected from the third party for any worker's compensation paid to the
injured employee.
This bill permits DWD to bring an action in tort against a third party for
damages by reason of an injury for which DWD has paid or is obligated to pay a claim
from the WISB fund and entitles the WISB fund to reimbursement from the proceeds
collected from the third party for any payments made to an injured employee from
that fund.
Reimbursement of supplemental benefits. Under current law, an injured
employee who is receiving worker's compensation for permanent total disability or
continuous temporary total disability resulting from an injury that occurred before
January 1, 2001, is entitled to receive supplemental benefits that in the first instance
are payable by the employer or insurer. The employer or insurer then is entitled to
reimbursement from the WISB fund for the supplemental benefits paid. This bill
requires an employer or insurer that has paid supplemental benefits to file a claim
for reimbursement with DWD by no later than 12 months after the end of the year
in which the supplemental benefits were paid in order to receive reimbursement
from the WISB fund for the supplemental benefits paid.
Second injury. Under current law, if an employee who has permanent partial
disability that would entitle the employee to 200 weeks of worker's compensation
incurs further permanent disability that entitles the employee to 200 weeks of
worker's compensation as a result of a second injury, the employee is entitled to
additional compensation from the WISB fund after the end of the period for which
compensation for permanent disability as a result of the second injury is payable by
the employer or insurer. That additional compensation is equivalent to the amount
that would be payable for the previous disability or the amount that is payable for
the further disability resulting from the second injury, whichever is less.
This bill permits an employee with such permanent partial disability who
incurs such further disability as a result of a second injury to receive that additional
compensation from the WISB fund only if the employee has not already received
compensation from the WISB fund as a result of a second injury.
Surcharges. Current law requires employers that are subject to the worker's
compensation law to keep records of all accidents causing death or disability of an
employee while performing services growing out of and incidental to the employee's
employment, requires insurers and self-insured employers to keep records of all
payments made under the worker's compensation law, and requires reports based on
those records to be furnished to DWD at the times and in the manner as DWD may
require by rule or general order. An employer or insurer that fails to keep those
records or to make those reports is subject to a surcharge of not less than $10 nor
more than $100 for each offense, which must be deposited in the WISB fund.
Current law provides that such a surcharge is due within 90 days after the date
on which notice of the surcharge is mailed to the employer or insurer. This bill
provides that such a surcharge is due within 30 days after that date.
Claims processing. Under current law, DOJ is required to defend claims
against the WISB fund. This bill permits DWD to retain the Department of
Administration (DOA) to process, investigate, and pay claims for payments from the
WISB fund. If retained by DWD, DOA may compromise a claim that it processes,
subject to review by DWD.
Adequacy of fund balance. Finally, with respect to the WISB fund, the bill
provides that if the secretary of workforce development determines that the expected
ultimate losses to the WISB fund on known claims exceed 85 percent of the cash
balance in that fund and that there is a reasonable likelihood that the cash balance
in that fund may become inadequate to fund all claims against the fund, the
secretary must file with the secretary of administration a certificate attesting that
the cash balance in that fund is likely to become inadequate to fund those claims and
specifying: 1) that payment of those claims will be made as provided in a schedule
that DWD must promulgate by rule; 2) a date after which payment of those claims
will be reduced; or 3) a date after which no new claims will be paid.
Hearings and procedures
Final practitioner's report. Under current law, if an injured employee has
a period of temporary disability of more than three weeks or a permanent disability
or has undergone surgery to treat an injury, other than surgery to correct a hernia,
the employer or insurer must submit to DWD a final treating practitioner's report.
This bill also requires that report to be submitted when an injured employer sustains
an eye injury requiring medical treatment on three or more occasions off the
employer's premises. The bill, however, prohibits DWD from requiring submission
of that report when the employer or insurer denies the employee's claim for
compensation and the employee does not contest that denial.
Program administration
Health service fee disputes. Under current law, if a health service provider,
injured employee, insurer, or employer submits to DWD a dispute over the
reasonableness of a health service fee charged by the health service provider for
services provided to the injured employee, DWD must determine the reasonableness
of the disputed fee by comparing the disputed fee to the mean fee for the procedure
for which the disputed fee was charged, as shown by data from a database certified
by DWD. If the disputed fee is at or below the mean fee, plus 1.4 standard deviations
from that mean, DWD must determine that the disputed fee is reasonable and order
the fee to be paid. If the disputed fee is above the mean fee, plus 1.4 standard
deviations from that mean, DWD must determine that the disputed fee is
unreasonable and order that a reasonable fee be paid, unless the health service
provider proves that a higher fee is justified. This bill lowers the standard deviations
used to determine the reasonableness of a disputed health service fee to 1.2 standard
deviations from the mean.
The bill also requires DWD to conduct an audit of the databases certified by the
DWD. If the audit is not commenced by the first day of the seventh month beginning
after the effective date of the bill: 1) the maximum weekly compensation rate for
permanent partial disability is lowered from $322 to $317 for injuries occurring on
or after January 1, 2013; and 2) the standard deviation used to determine the
reasonableness of a disputed health service fee is increased from 1.2 standard
deviations from the mean to 1.3 standard deviations from the mean beginning on
January 1, 2013.
Study of funding for permanent total disability increases. Under current
law, the amount of the weekly indemnity for permanent total disability that is
payable to an injured employee is determined as of the date of injury. An injured
employee who is receiving compensation for permanent total disability resulting
from an injury that occurred before January 1, 2001, however, is also entitled to
receive certain supplemental benefits from the employer or insurer or, in certain
cases, from the WISB fund.
This bill requires the secretary of workforce development to create a committee
to study methods of funding the cost of providing regular, periodic increases in the
weekly indemnity for permanent total disability, if legislation providing for those
increases were to be enacted. The study must include methods of funding the cost
of providing those increases for injured employees receiving that indemnity on the
day before the effective date of that legislation.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB409, s. 1
1Section
1. 16.865 (4) of the statutes is amended to read:
SB409,6,62
16.865
(4) Manage the state employees' worker's compensation program and
3the statewide self-funded programs to protect the state from losses of and damage
4to state property and liability
and, if retained by the department of workforce
5development under s. 102.65 (3), process, investigate, and pay claims under ss.
6102.44 (1), 102.49, 102.59, and 102.66 as provided in s. 102.65 (3).
SB409, s. 2
7Section
2. 20.445 (1) (t) of the statutes is amended to read:
SB409,6,128
20.445
(1) (t)
Work injury supplemental benefit fund. All moneys paid into the
9work injury supplemental benefit fund under ss. 102.35 (1), 102.47, 102.49, 102.59,
10102.60, and 102.75 (2), to be used for the discharge of liabilities payable under ss.
11102.44 (1), 102.49, 102.59, 102.63, 102.64 (2), and 102.66
and for the retention of
12services under s. 102.65 (3).
SB409, s. 3
13Section
3
. 102.03 (4) of the statutes is amended to read:
SB409,7,214
102.03
(4) The right to compensation and the amount of the compensation shall
15in all cases be determined in accordance with the provisions of law in effect as of the
16date of the injury except as to employees whose rate of compensation is changed as
17provided in ss. 102.43 (7)
and or 102.44 (1)
and or (5)
or, before the first day of the
1825th month beginning after the effective date of this subsection .... [LRB inserts
19date], as provided in s. 102.43 (5) (c) and employees who are eligible to receive private
1rehabilitative counseling and rehabilitative training under s. 102.61 (1m) and except
2as provided in s. 102.555 (12) (b).
SB409, s. 4
3Section
4. 102.11 (1) (intro.) of the statutes is amended to read:
SB409,7,204
102.11
(1) (intro.) The average weekly earnings for temporary disability,
5permanent total disability, or death benefits for injury in each calendar year on or
6after January 1, 1982, shall be not less than $30 nor more than the wage rate that
7results in a maximum compensation rate of 110 percent of the state's average weekly
8earnings as determined under s. 108.05 as of June 30 of the previous year. The
9average weekly earnings for permanent partial disability shall be not less than $30
10and, for permanent partial disability for injuries occurring on or after
May 6, 2010,
11and before January 1, 2011, not more than $438, resulting in a maximum
12compensation rate of $292, and, for permanent partial disability for injuries
13occurring on or after January 1, 2011, not more than $453, resulting in a maximum
14compensation rate of $302 the effective date of this subsection .... [LRB inserts date],
15and before January 1, 2013, not more than $468, resulting in a maximum
16compensation rate of $312, and, for permanent partial disability for injuries
17occurring on or after January 1, 2013, not more than $483, resulting in a maximum
18compensation rate of $322, except as provided in 2011 Wisconsin Act .... (this act),
19section 30 (2) (a
). Between such limits the average weekly earnings shall be
20determined as follows:
SB409, s. 5
21Section
5. 102.13 (2) (c) of the statutes is amended to read:
SB409,8,1122
102.13
(2) (c)
If Except as provided in this paragraph, if an injured employee
23has a period of temporary disability that exceeds 3 weeks or a permanent disability
24or, if the injured employee has undergone surgery to treat his or her injury, other than
25surgery to correct a hernia,
or if the injured employee sustained an eye injury
1requiring medical treatment on 3 or more occasions off the employer's premises, the
2department may by rule require the insurer or self-insured employer to submit to
3the department a final report of the employee's treating practitioner.
The
4department may not require an insurer or self-insured employer to submit to the
5department a final report of an employee's treating practitioner when the insurer or
6self-insured employer denies the employee's claim for compensation and the
7employee does not contest that denial. A treating practitioner may charge a
8reasonable fee for the completion of the final report, but may not require prepayment
9of that fee. An insurer or self-insured employer that disputes the reasonableness of
10a fee charged for the completion of a treatment practitioner's final report may submit
11that dispute to the department for resolution under s. 102.16 (2).
SB409, s. 6
12Section
6. 102.16 (2) (d) of the statutes is amended to read:
SB409,9,313
102.16
(2) (d) The department shall analyze the information provided to the
14department under par. (c) according to the criteria provided in this paragraph to
15determine the reasonableness of the disputed fee.
The
Except as provided in 2011
16Wisconsin Act .... (this act), section 30 (2) (b
), the department shall determine that
17a disputed fee is reasonable and order that the disputed fee be paid if that fee is at
18or below the mean fee for the health service procedure for which the disputed fee was
19charged, plus
1.4 1.2 standard deviations from that mean, as shown by data from a
20database that is certified by the department under par. (h).
The Except as provided
21in 2011 Wisconsin Act .... (this act), section 30 (2) (b
), the department shall determine
22that a disputed fee is unreasonable and order that a reasonable fee be paid if the
23disputed fee is above the mean fee for the health service procedure for which the
24disputed fee was charged, plus
1.4 1.2 standard deviations from that mean, as shown
25by data from a database that is certified by the department under par. (h), unless the
1health service provider proves to the satisfaction of the department that a higher fee
2is justified because the service provided in the disputed case was more difficult or
3more complicated to provide than in the usual case.
SB409, s. 7
4Section
7. 102.17 (4) of the statutes is amended to read:
SB409,9,245
102.17
(4) Except as provided in this subsection and s. 102.555 (12) (b), the
6right of an employee, the employee's legal representative, or a dependent to proceed
7under this section shall not extend beyond 12 years after the date of the injury or
8death or after the date that compensation, other than
for treatment or burial
9expenses, was last paid, or would have been last payable if no advancement were
10made, whichever date is latest. In the case of occupational disease; a traumatic
11injury resulting in the loss or total impairment of a hand or any part of the rest of
12the arm proximal to the hand or of a foot or any part of the rest of the leg proximal
13to the foot, any loss of vision, or any permanent brain injury; or a traumatic injury
14causing the need for an artificial spinal disc or a total or partial knee or hip
15replacement, there shall be no statute of limitations, except that benefits or
16treatment expense for an occupational disease becoming due 12 years after the date
17of injury or death or last payment of compensation
, other than for treatment or burial
18expenses, shall be paid from the work injury supplemental benefit fund under s.
19102.65 and in the manner provided in s. 102.66 and benefits or treatment expense
20for
such a traumatic injury becoming due 12 years after that date shall be paid
by
21the employer or insurer from that fund and in that manner if the date of injury or
22death or last payment of compensation, other than for treatment or burial expenses,
23is before April 1, 2006. Payment of wages by the employer during disability or
24absence from work to obtain treatment shall be considered payment of compensation
1for the purpose of this section if the employer knew of the employee's condition and
2its alleged relation to the employment.
SB409, s. 8
3Section
8. 102.29 (1) of the statutes is renumbered 102.29 (1) (a) (intro.) and
4amended to read:
SB409,10,215
102.29
(1) (a) (intro.) The making of a claim for compensation against an
6employer or compensation insurer for the injury or death of an employee shall not
7affect the right of the employee, the employee's personal representative, or other
8person entitled to bring action
, to make claim or maintain an action in tort against
9any other party for such injury or death, hereinafter referred to as a 3rd party; nor
10shall the making of a claim by any such person against a 3rd party for damages by
11reason of an injury to which ss. 102.03 to
102.64
102.66 are applicable, or the
12adjustment of any such claim, affect the right of the injured employee or the
13employee's dependents to recover compensation.
The
An employer or compensation
14insurer
who shall have that has paid or is obligated to pay a lawful claim under this
15chapter shall have the same right to make claim or maintain an action in tort against
16any other party for such injury or death. If the department pays or is obligated to
17pay a claim under s.
102.66 (1) or 102.81 (1), the department shall also have the right
18to maintain an action in tort against any other party for the employee's injury or
19death. However, each shall give to the other reasonable notice and opportunity to
20join in the making of such claim or the instituting of an action and to be represented
21by counsel.
SB409,11,7
22(b) If a party entitled to notice cannot be found, the department shall become
23the agent of
such that party for the giving of a notice as required in
this subsection 24par. (a) and the notice, when given to the department, shall include an affidavit
25setting forth the facts, including the steps taken to locate
such that party. Each shall
1have an equal voice in the prosecution of
said
the claim, and any disputes arising
2shall be passed upon by the court before whom the case is pending, and if no action
3is pending, then by a court of record or by the department. If notice is given as
4provided in
this subsection par. (a), the liability of the tort-feasor shall be
5determined as to all parties having a right to make claim
, and
, irrespective of
6whether or not all parties join in prosecuting
such
the claim, the proceeds of
such the 7claim shall be divided as follows:
SB409,11,10
81. After deducting the reasonable cost of collection, one-third of the remainder
9shall in any event be paid to the injured employee or the employee's personal
10representative or other person entitled to bring action.
SB409,11,18
112. Out of the balance remaining
after the deduction and payment specified in
12subd. 1., the employer,
the insurance carrier, or, if applicable,
the uninsured
13employers fund
or the work injury supplemental benefit fund shall be reimbursed
14for all payments made by
it the employer, insurance carrier, or department, or which
15it the employer, insurance carrier, or department may be obligated to make in the
16future, under this chapter, except that
it the employer, insurance carrier, or
17department shall not be reimbursed for any payments made or to be made under s.
18102.18 (1) (bp), 102.22, 102.35 (3), 102.57, or 102.60.
SB409,11,21
193. Any balance remaining
after the reimbursement described in subd. 2. shall
20be paid to the employee or the employee's personal representative or other person
21entitled to bring action.
SB409,12,2
22(c) If both the employee or the employee's personal representative or other
23person entitled to bring action, and the employer, compensation insurer, or
24department, join in the pressing of said claim and are represented by counsel, the
25attorney fees allowed as a part of the costs of collection shall be, unless otherwise
1agreed upon, divided between
such the attorneys
for those parties as directed by the
2court or by the department.
SB409,12,6
3(d) A settlement of
any a 3rd-party claim shall be void unless
said the 4settlement and the distribution of the proceeds
thereof is of the settlement are 5approved by the court before whom the action is pending
and or, if no action is
6pending, then by a court of record or by the department.
SB409, s. 9
7Section
9. 102.35 (1) of the statutes is amended to read:
SB409,12,218
102.35
(1) Every employer and every insurance company that fails to keep the
9records or to make the reports required by this chapter or that knowingly falsifies
10such records or makes false reports shall pay a work injury supplemental benefit
11surcharge to the state of not less than $10 nor more than $100 for each offense. The
12department may waive or reduce a surcharge imposed under this subsection if the
13employer or insurance company that violated this subsection requests a waiver or
14reduction of the surcharge within 45 days after the date on which notice of the
15surcharge is mailed to the employer or insurance company and shows that the
16violation was due to mistake or an absence of information. A surcharge imposed
17under this subsection is due within
90 30 days after the date on which notice of the
18surcharge is mailed to the employer or insurance company. Interest shall accrue on
19amounts that are not paid when due at the rate of 1 percent per month. All
20surcharges and interest payments received under this subsection shall be deposited
21in the fund established under s. 102.65.
SB409, s. 10
22Section
10. 102.43 (5) of the statutes is amended to read:
SB409,12,2523
102.43
(5) (a) Temporary disability, during which compensation shall be
24payable for loss of earnings, shall include such period as may be reasonably required
25for training in the use of artificial members and appliances.
SB409,13,11
1(b) Except as provided in s. 102.61 (1g), temporary disability shall also include
2such period as the employee may be receiving instruction
pursuant to under s. 102.61
3(1) or (1m). Temporary disability on account of receiving instruction
of the latter
4nature under s. 102.61 (1) or (1m), and not otherwise resulting from the injury, shall
5not be in excess of 80 weeks. Such 80-week limitation does not apply to temporary
6disability benefits under this section,
the cost of tuition, fees, books, travel, or
7maintenance
expense under s. 102.61 (1), or
the cost of private rehabilitation
8counseling or rehabilitative training
costs under s. 102.61 (1m) if the department
9determines that additional training is warranted. The necessity for additional
10training as authorized by the department for any employee shall be subject to
11periodic review and reevaluation.