Mandatory Overtime Hours included in Average Weekly Wage

9-21-08

The 18 year battle over including or excluding overtime hours in the calculation of average weekly wage continues to rage. All Illinois benefits are derived from the workers "average weekly wage" in the 52 weeks preceding the accident. Accordingly, weekly earnings or weekly wages have been a hotly contested area of dispute. Average weekly wages are used to calculate both temporary disability benefit rates and permanent disability benefits. Section 10 of the Illinois Workers Compensation Act clearly and specifically excludes overtime earnings in calculation of average weekly wage.

However, since 1990, in Edward Hines Lumber, mandatory overtime hours have been included where they form the "regular hours" of employment. There the worker for Hines Lumber was regularly required to work mandatory 10 hour days, for 6 days a week, as a condition of his regular employment. Since the overtime hours were mandatory and required as part of the "regular employment", the overtime hours were included in the calculation of wages at the straight time rate of pay.

After the Hines case, the Illinois Commission continued to exclude overtime earnings if either not regularly worked or if not mandatory. The Commission's definition of "regularly worked" generally included overtime hours at the straight time rate of pay if the worker "regularly worked" overtime hours in more than 50% of the weeks or where the overtime was mandatory. The Illinois Appellate Court also consistently excluded overtime hours that were not mandatory as a condition of employment or which were not part of a set number of hours or regularly worked each week as part of the regular employment. Edward Don (2003) and Freesen (2004).

Last year in Airborne Express (March 2007), the court held voluntary overtime is excluded. The Appellate Court said that merely working voluntary overtime on a regular but voluntary basis, is definitely excluded in calculation of average weekly wage otherwise, the overtime exclusion in Section 10 of the Act would be completely meaningless. Some have argued that Airborne excludes all overtime hours unless both mandatory and consistently regularly worked as a set number of hours but, that does not appear to accurately comport with the prior case law under Freesen and Don or prior Commission decisions.

Shortly after Airborne decision, the Commission decided Terrell v Jacksonville (07 IWCC 1319, October 2007) wherein the Commission said that to include the overtime hours, the worker must show that the overtime was either regular and consistent or mandatory. In Terrell, a mental health technician was required to work overtime hours because the facility was short staffed and the employer did not deny the overtime was mandatory so, the Commission included the overtime. In Lockhart v Dominick's (08 IWCC 318, March 2008) a delivery driver testified he was required to finish daily deliveries and some of his overtime hours were mandatory but, he failed to prove the exact amount of mandatory overtime hours so the overtime hours were excluded. Recently in Heffner v Little Lady (08 IWCC 510, May 2008) the Commission also denied inclusion of the overtime hours for a maintenance supervisor where the overtime hours were not shown to be mandatory or part of the regular hours of employment.

In reading the case law, it looks like the definition for exclusion of overtime under Section 10 is much more easily defined than in considering all the situations where overtime hours might or should be included in calculation of wages. The Appellate Court in Airborne clearly said that they have consistently held that the Section 10 exclusion of overtime in calculation of weekly wages excludes all overtime hours where the worker is not required to work the overtime as a condition of employment (i.e. mandatory) or excludes the overtime hours which are not part of a set number of hours consistently worked each week.

The nuance in terms in overtime wages is often misunderstood. Workers and employers should both be very concerned with the proper calculation of average weekly wage and they should both be encouraged to contact an experienced Illinois workers compensation attorney for consultation given that a fair amount of money is involved in calculation of temporary disability benefits or permanent partial disability benefits. Especially large amounts of money can be involved in long term payments of wage differential benefits and in claims for permanent total disability, both of which payments can last for the full lifetime of the worker.

Chicago Workers Compensation Attorneys -- http://WC-Chicago.com -- 9-21-08

ISBA Advanced Seminar on Illinois Workers Compensation

9-14-08

The ISBA Workers Compensation Section will be hosting a CLE program on Advanced Illinois Workers Compensation on October 13, 2008 offered both in Chicago at the ISBA Regional Office (map and directions) and in Collinsville, Illinois (map and directions). The course will include current topics facing Illinois workers' compensation attorneys, including repetitive trauma in carpal tunnel cases, workplace slip and fall injuries, parking lot cases, qualifications and obligations for vocational rehabilitation and job retraining, Medicare Set Aside future medical expense accounts – avoiding pitfalls, ethical practice considerations at the Illinois Workers Compensation Commission and an update on recent Illinois workers compensation case law.

John B. Adams,moderator, Roddy, Leahy, Guill & Zima, Ltd, Chicago

Speakers:

David Barish, Katz Friedman Eagle et. al., Chicago (Chicago program)
Deborah Benzing, Law Offices of Lauren Meachum, Chicago (Chicago program)
Brad Bleakney, Bleakney and Troiani, Chicago (Chicago program)
Richard Hannigan, Mundelein (Chicago program)
Carol Hartline, Williams and McCarthy, Rockford (Collinsville program)
Jennifer Kieswetter, Ottawa (Chicago program)
Michelle Lafayette, Ganan & Shapiro, PC, Chicago (Collinsville program)
Kevin Meckler, Carbondale (Collinsville program)
David Menchetti, Cullen, Haskins, Nicholson & Menchetti, Chicago (Chicago program)
Robert C. Nelson, Nelson & Nelson, Belleville (Collinsville program)
Bradford Peterson, Urbana (Collinsville program)
Lawrence Scordino, Chicago (Chicago program)
Kristen Wadiak, Beatty and Motil, Glen Carbon (Collinsville program)
Kenneth Werts, Craig & Craig, Mt. Vernon (Collinsville program)

ISBA members $135 in advance and $150 the week of seminar. 5 MCLE credits For online registration

Chicago Workers Compensation Attorneys -- http://wc-chicago.com - 9-14-08

New Chairman for Illinois Workers Compensation Commission

09-10-08

Governor Blagojevich appointed a new Chairman of the Illinois Workers Compensation Commission, effective October 3, 2008. Arbitrator Gerald Jutila was unanimously recommended by the Workers’ Compensation Advisory Board and appointed by the Governor. Under the 2005 workers’ compensation reforms, the Advisory Board makes recommendations on Commission appointments to the Governor.

Chairman Jutila holds a B.A. degree in Political Science from the University of Minnesota and a J.D. degree from John Marshall Law School. Chairman Jutila also served as an arbitrator at the Chicago Commission since September 2004. He has over 29 years of practical experience in workers’ compensation as an attorney primarily representing injured workers.

As an attorney, Jutila has a broad range of experience at all levels of workers compensation practice, appellate practice and 3rd party negligence practice bringing a well rounded perspective and depth of prior case law to the Chair of the Commission. His knowledgeable and practical legal background will provide the Commissioners and members of the Commission with an invaluable resource.

Chairman Jutila's talents in both personal persuasion and leadership should gain cooperation from Commission staff and practicing attorneys from both sides of the isle.

As a practicing Chicago workers compensation attorney we more than welcome the appointment.

Chicago Workers Compensation Attorneys -- http://wc-chicago.com 9-10-08

Mandatory Insurer Reporting (MIR): Medicare Secondary Payer Reporting

A new law known as Mandatory Insurer Reporting (MIR) eff. January 1, 2008, will require insurers to report coverage information or claim information for Medicare beneficiaries to CMS for the purposes of coordination of benefits.

Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (PL 110-173) amends the Medicare Secondary Payer (MSP) provisions of the Social Security Act (Section 1862(b) of the Social Security Act; 42 U.S.C. 1395y(b)) to provide for mandatory reporting of insurance coverage for group health plans, liability insurance (including self-insurance), no-fault insurance, and workers' compensation. The new law imposes a reporting duty on carriers to report the identity of Medicare beneficiaries and coverage information to CMS for all those that are covered by "primary" plans like health insurance, or active claims under workers compensation or auto liability plans.

On 8-1-08 CMS released a Statement Summary listing Medicare mandatory reporting "data elements" listing required reporting details and the reasons behind implementing the requirements. Carriers must now notify CMS if a known Medicare recipient has a claim or coverage. Fines for noncompliance are $1,000 /day.

Compliance dates: -- January 1, 2009 information reporting for group health plans
-- July 1, 2009 reporting from liability insurance, no-fault insurance, and workers' compensation.

It is expected CMS will demand to be notified of all workers compensation settlements or all liability settlements for any Medicare beneficiaries so as to enforce the Secondary Payer Regulations, Medicare lien recovery rules and credits against future payments for injury related medical expense. Reporting requirements may also include (1) Nature of Injury, (2) Cause of Injury, (3) State of Venue, (4) ICD-9 primary diagnosis codes and (5) Specific Body Part involved. See the Statement Summary above for a detailed listing of data elements.

CMS created a central web page, Mandatory Medicare Insurance Reporting, for summary information regarding the updated carrier reporting requirements, updated memos and .pdf downloads.

Chicago Workers Compensation Attorneys -- http://wc-chicago.com 8-12-08

Chicago Workers Compensation Attorneys

8-02-08

Chicago workers compensation attorneys with advanced trial and appeal practice before the Illinois Workers Compensation Commission since 1984. We have successfully tried all types of Illinois work injury claims in construction, food service, hospital, manufacturing and transportation.

Our Chicago workers compensation attorneys have extensive trial experience in Illinois injury claims covering a broad range of medical conditions and injury types. Our experienced attorneys work to maintain a competitive edge in Illinois work injury litigation and workers compensation injury claims.

We attempt to provide each client with individual instruction, preparation, education and available options in Illinois work injury claims. We provide dedicated and aggressive representation in Illinois workers compensation and assistance in work injury litigation in Chicago and the surrounding area cities which include:

Chicago and suburbs, Waukegan, Barrington, Lake Zurich, Mundelein, Libertyville, McHenry, Woodstock, Geneva, St. Charles, Wheaton, Downers Grove, Orland Park, Hinsdale, Naperville, Aurora, Romeoville, Joliet, Bourbonnais and Kankakee.

Covering Cook County, Lake County, McHenry County, Kane County, DuPage County, Will and Kankakee County.

If in need of assistance, contact our office at (312) 541-0049 for a review, meeting or claim consultation.


Chicago Workers Compensation Attorneys -- http://wc-chicago.com 8-02-08

Illinois Employee Classification Act: Construction Workers, Proposed Rule Changes

7-28-08

The Illinois Employee Classification Act provides that individuals performing services for construction contractors on or after January 1, 2008 are presumed to be employees of the contractor unless they meet the criteria specified in the Act. If a contractor has misclassified individuals as independent contractors, the Department may assess civil penalties and seek other remedies provided for in the Act.

See link for an overview of the Act’s definitions and prohibitions .

The Act addresses a known practice in the construction industry of contractors misclassifying individuals as independent contractors in order to avoid payroll taxes, unemployment insurance contributions, workers' compensation premiums and minimum wage and overtime payments.

For the purpose of ensuring that all Illinois contractors comply with Illinois tax and employment laws, the Illinois Department of Labor, the Illinois Department of Employment Security, the Illinois Department of Revenue and the Illinois Workers' Compensation Commission will be sharing any information on employers suspected of misclassification of employees as independent contractors.

The Department of Labor issued new proposed rule changes for the act 6/26/08 in response to recent public comments and recent departmental experience. The hearings on proposed rules will be heard before the Joint Committee on Administrative Rules.

Questions regarding proposed rule changes, contact Carmela Gonzalez at 312-793-1808.

Chicago Workers Compensation Attorneys – http://wc-chicago.com 7-28-08

Overfunding Workers Comp Medicare Set Aside Accounts with No Appeal Rights

7-27-08

The National Alliance for Medicare Set-Aside Professionals (NAMSAP) issued a recent letter 7/2/08 directed to CMS listing grievances in the CMS review approval process for Medicare Set-Aside Allocation (MSA) proposals. The very real concern for all parties is that these MSA approval decisions are final. There exists no appeal process from the final administrative decisions regarding MSA future medical funding. It has been stated that MSA proposal reconsideration submissions (the only current process available) have been met with resistance and/or were generally ignored.

For the sake of brevity, the short list of pressing concerns is paraphrased below:

1. INCLUDING NON- MEDICARE ITEMS OR TREATMENTS: Recent MSA approvals are routinely requiring funding for non- Medicare items or treatments which would not be covered by Medicare nor for which the workers compensation insurance carriers would be liable under the state workers' compensation laws.

2. APPLYING STANDARDIZED NATIONAL PRICING: CMS has applied their own standardized national pricing for some procedures, such as Spinal Cord Stimulators, without regard to actual price levels in the state of injury, locale of the injured worker or the relevant state Workers Compensation Fee Schedule. The result is that the national pricing is either too high or too low in funding recommendations for the MSA.

3. UPCODING OF CPT CODES for some treatments that result in higher MSA funding costs. An example was given of upcoding historically accurate 99213 office visits to 99214 office visits. It is alleged that this upcoding occurs as well on MRI's (adding in with contrast codes, instead of standard without contrast code, and x-rays (changing historical 2-3 views to 4 views). By "upcoding", the WCRC is not pricing the MSA pursuant to the amount which Medicare or the insurer would have actually otherwise paid.

4. HIGHEST ONLINE PRICING FOR MEDICAL EQUIPMENT: not the average price at which the equipment can be purchased and the high pricing is often contrary to the relevant state WC fee schedule. In some cases CMS required full MSA funding for all of the following: a cane, a walker, a manual wheelchair, and an electric wheelchair even though Medicare would not actually cover or pay for all those items under their own coverage guidelines for an actual Medicare Beneficiary.

5. ACCEPTANCE OF IME REPORTS only when they recommend increases for medical treatment exceeding the recommendations of the treating physician. Conversely, CMS will not accept the IME opinion reports if they recommend less treatment than that recommended by the treating physician.

6. IDENTICAL CASES NOT GIVEN THE SAME MSA FUNDING APPROVAL. Although the irregularities listed are not claimed to occur in all cases, eliminating variances would help in preparing future MSA proposal estimates for ready approval.

7. IGNORING LIMITATIONS UNDER STATE WORKERS' COMPENSATION LAW: The obligations of the WC employer or insurer for payment of injury related medical expense is defined by that particular state’s workers' compensation law, but that liability or limitations of liability of the employer under their state’s law is routinely ignored by CMS when assessing MSA proposals effectively denying the employer or insurer due process and substantive rights.

A copy of the 7/02/08 letter by the NAMSAP Board of Directors is available here at the following link: NAMSAP Letter (http://www.gouldandlamb.com/files/NAMSAP_Position_Letter.pdf)

The hopes are that CMS will now address these consensus problems that have been increasing the overall cost of MSA approval amounts and ultimately, increasing the overall cost of Workers Compensation settlements.

In discussions with local MSA attorneys in Chicago, the unanimous complaint mentioned is the extended delay time in obtaining prior Medicare “conditional payment” amounts in order to finalize any reimbursement claims.

From our perspective, the concern remains that CMS/ MSA approval amounts do not correlate with or reflect the actual “compromise” value of the workers compensation settlement.

While workers compensation claims often remain disputed in significant respects and settlement dollars usually represent real “compromise” figures pricing in the value of disputed issues, CMS continues to require 100% funding of MSA future medical accounts for anticipated treatment even where that medical treatment itself may remain disputed and/or even where the injured worker is only receiving 50% or less of the full value of the claim. The proportional disputed “compromise” values of disputed issues are not reflected in the MSA account approval amounts.

While workers compensation carriers should not be able to pawn off related future medical expense onto Medicare and the taxpayer, the employers and work comp insurance carriers should not be required to pay for more than their fair share of liability for open medical rights or expenses under the workers compensation claim any more than if that claim had remained open.

Chicago Workers Compensation Attorneys -- http://wc-chicago.com 7-21-08

Illinois Workers Compensation Medical Fee Schedule proposal for Outpatient Services

The Illinois Workers' Compensation Commission Medical Fee Schedule and the payment guidelines were adopted in 2005 for a statewide comprehensive Workers Compensation Medical Fee Schedule broken down by Illinois zip codes. The maximum allowable payment for a particular medical procedure, treatment or service covered under the Workers Compensation Act is now set in a schedule based on the historical charges for locations throughout the state from 2002 to 2004, cost adjusted for inflation. Historical charges were analyzed and broken down by the 3 number geozip or 1st three numbers of a zip code, i.e., 606—for Chicago. Generally, the reimbursement rates are set at 90% of the 80th percentile of actual historical charges provided for treatment in a specific area zip code. The Illinois medical fee schedule is one of the most comprehensive fee schedules for any state workers compensation program.

The new medical fee schedule rules cover all medical care rendered on or after February 1, 2006. The medical fee schedule sets forth the caps or maximum limits for payment of medical invoices based on particular medical procedure code, the date of service and the location (or zip code) where the medical care is rendered.

The amounts payable to a medical provider under the fee schedule is set out as the lesser of the Fee Schedule amount, the actual billing charge or a controlling "negotiated rate" as established by negotiated provider contract with the medical provider. An established contract between the insurance carrier or employer will control over amounts set forth in the schedule.

Inpatient Hospital charges and Physician Professional charges are listed in specific amounts in the fee schedule. Special rules apply for add-on or pass through charges for hardware, instrumentation and medical devices.

The Commission is currently working on adopting a fee schedule for hospital outpatient charges and ambulatory surgical fee charges. The proposed Illinois fee schedule and rules for hospital outpatient services and ambulatory surgery charges are available in draft at this link to the Commission website. Official Public Comment hearings are currently being held on the proposed new outpatient schedule in both Chicago and Springfield.

Chicago Workers Compensation Attorneys – http://wc-chicago.com 7-16-08

Illinois Trucking Company sues Ohio Employer ADT in 3rd Party claim in ladder accident

6-15-08

Palmer v. Freightliner (1^st Dist., June 2008) Ohio employer, ADT was stuck with a 3rd party claim for contribution for negligence even though Ohio law prohibits 3rd party contribution actions in personal injury cases for claims against an employer where the employer provides workers compensation insurance coverage.

An Ohio security & alarm system installer, Palmer, employee for ADT was working on a 20 ft ladder leaning against a loading dock garage door at Freightliner’s Wood Dale, Illinois facility when a Freightliner employee opened the garage door. The ladder fell and Palmer crashed to the ground.

Illinois law allows an employer to be immune from direct suit by an injured employee but not free from suit brought by a primary defendant in a claim for contribution for partially causing the injury. In Ohio, an employer who complies with providing workers compensation insurance is immune from negligence suits in employee personal injury cases.

In an excellent analysis and application of the Restatement 2d of Conflicts of Law and prior Illinois Supreme Court law, the Palmer decision held that the Ohio employer could be sued for contribution for their share of negligence.

The general rule (per Section 146 of the Restatement of Conflicts) is that the local laws of the state where the injury occurred will determine the rights and liabilities of the parties in a personal injury action unless some other state “has a more significant relationship.”

Despite the fact that Palmer was an Ohio resident, an Ohio employee and paid Ohio workers compensation benefits, including a $7,500 settlement, Illinois had the “most significant relationship.” The court examined (1) place where injury occurred, (2) place where conduct causing injury occurred, (3) residence and domicile of all parties & place of business and (4) where the “relationship” of the parties was centered.

Illinois applies the principles of comparative fault to all parties in a personal injury accident. Freightliner was allowed to pursue a claim of some portion of blame on the Ohio employer, ADT.

Questions by Illinois employers on actions for indemnification, contribution or workers compensation lien recovery should be addressed by an Illinois workers compensation attorney with practical experience and knowledge in this specific area of the law.

Chicago Workers Compensation Attorneys -- http://wc-chicago.com 6-15-08

Illinois Workers Compensation -- Medicare Coordination Update

6-7-08

The Centers for Medicare & Medicaid Services (CMS) have consolidated all Medicare Secondary Payer (MSP) payment recovery for Auto, Workers Comp & Group Health plans into one Payment Recovery Center. The location provides payout information on conditional payments and coordinates recoveries. For specific Workers Compensation recovery coordination contact:

MSPRC WC
PO Box 33831
Detroit, MI 48232-5831

For Pay out and Recovery information Contact:

tel: (866) 677-7220 or (866) 677-7294 (TTY/TDD) fax: (734) 957-0998

The real news is the new MSPRC website for direct contact and a nice explanation of the MSPR form letters.

On May 20, 2008, CMS also issued a new memo indicating all future Workers' Compensation Medicare Set-Aside allocations must be calculated based only on life expectancy tables using Table 1 of the CDC Life Tables for Total Population.

Read the 5/20/08 CMS update memo online.

Questions related to Illinois workers compensation settlements and Medicare Set aside coordination should be addressed to our Chicago workers compensation attorneys.

Chicago Workers Compensation Attorneys – http://wc-chicago.com 6-7-08