443 Lafayette Road N.

(651) 284-5005
St. Paul, Minnesota 55155 1-800-DIAL-DLI
www.doli.state.mn.us TTY: (651) 297-4198

Workers' Compensation Advisory Council

Oct. 11, 2006
minutes
Voting members: DLI staff members:

Wayne Ellefson Kate Berger

Don Gerdesmeier Scott Brener
Mike Wild for Glen Johnson Debbie Caswell
David Olson Patricia Todd
Reed Pollack
Andrea Trimble-Hart for Brad Robinson Visitors:
Brad Lehto for Ray Waldron
Craig Anderson; MWCIA
Voting members excused: Debra Anger; LMCIT
Amber Backhaus; MSIA
Mike Hickey Karen Clayton Ebert;MCIT
James Cavanaugh Ken Gildow; RTW
Gary Thaden Laura Harris; LMC
David Hawkins; Target Corp.
Voting members absent: Tom Hesse: Minnesota Chamber
Brian Hicks; MAPS
Stan Daniels Todd Johnson; WCRA
Julie Schnell David Kunz; MN Chiropractic Assn
Tammy Lohman; Commerce
Nonvoting members: Bob Lund; SFM
Andy Morrison; Koll, Morrison
Sen. Tom Bakk John Nesse; Association Offices
Sara Noznesky; MMA
Nonvoting members absent: Gary Pelletier; MAPS
Linda Sandvig; Allina
Denny McNamara Katy Sen; MN House of Rep Staff
Sen. Geoff Michel Scott Sexton; Corvel
Rep. Mike Nelson Bev Turner; St. Paul Companies
David Wulff; MTLA

The meeting was called to order at 9:42 a.m. by Commissioner Scott Brener,
serving as chairperson. Roll was called and a quorum was not present.

Brener focused on the conversations held on the Workers' Compensation

Advisory Council (WCAC) road trips in Brainerd, Mankato and St. Paul. He reviewed a
summary about benefits, litigation, medical and general issues. A copy of that summary
is included in these minutes.
Workers' Compensation Advisory Council -2- October 11, 2006
Minutes

Preliminary Workers’ Compensation Advisory Council Public Meeting Cumulative Summary

GLOBAL CONCERNS/COMMENTS SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS

ISSUE For discussion purposes only
BENEFITS 1. Wage-loss benefits are not high TTD benefits end 90 days after MMI, or after 104 weeks of paid TTD, whichever comes • Extend the duration of wage-loss
enough or long enough. first. (In addition to other reasons in law.) benefits.

• TTD benefit duration should not end
at 104 weeks or MMI.
• Extend the time to file a request for
retraining beyond 156 weeks.
• 66 2/3 percent is not enough.
2. Cost of living adjustments are not
adequate; they should be more
reflective of general cost-of-living
increases, especially long term.
A request for retraining must be filed with the commissioner before 156 weeks of any • Start a request period at MMI
combination of TTD or TPD have been paid. The time is extended if notice is not timely instead of date of injury. Or, extend
given. A penalty is payable for the insurer’s failure to provide the notice. the time to request retraining to 156
weeks after the injury, or 90 days
Compensation is 66 2/3 percnent of the weekly wage at the time of injury (not taxable). after MMI, whichever is later.
For injuries on or after Oct. 1, 2000, the max comp rate is $750 a week; the minimum is
the lower of $130 a week or the actual weekly wage. Revise the percentage or maximum
compensation rate.
Wage-loss benefits are annually adjusted by the increase in the statewide average • Modify the maximum adjustment
weekly wage, with various limitations depending on the date of injury. (Benefits may be percentage or deferral period.
adjusted above the maximum comp rate.) For injuries on or after Oct. 1, 1995, the
maximum adjustment is 2 percent, deferred until the fourth anniversary of the date of
injury.

1
This is only a broad overview of some of the highlights of the applicable law and DLI practices. The actual laws and practices are more specific and complex.
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Workers' Compensation Advisory Council -3- October 11, 2006
Minutes
GLOBAL CONCERNS/COMMENTS SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS
ISSUE For discussion purposes only
3. Other employment benefits are lost in The workers’ compensation law does not require an employer to continue group health • Consider incentives for an employer
the workers' compensation system. coverage or continue contributing to a pension or retirement plan after an injury. to continue employee benefits.
• Provide incentives for an employer to However, the Family and Medical Leave Act requires employers with 50 or more
continue employee benefits. employees to continue existing health coverage at no additional cost for an employee • Continue general health insurance
with a serious health condition for 12 weeks under certain circumstances. COBRA law coverage until MMI or include the
• Continue health coverage for injured provides for continuation of group health coverage for a disabled employee after value in calculating the pre-injury
workers. employment is terminated, as long as the employee pays the premium.2 weekly wage.

• Address lost retirement benefits not
accrued during workers'
compensation claim, i.e., Alaska's
system.
Alaska law (AS) 23.30.396 provides that contributions made by an employer to a qualified • Continue the employer’s
pension or profit-sharing plan during two years before the injury, multiplied by the contribution to retirement benefits
percentage of employee’s vested interest shall be included in the determination of gross until MMI or include the value in
earnings. calculating the pre-injury weekly
wage.

2
Under federal law (applicable to employers with at least 20 employees) an employee who becomes disabled while employed can continue coverage for 29 months. Under Minnesota law, (applicable to fully insured employers with
two or more employees) an employee who becomes totally disabled while employed may remain in the group health plan indefinitely. For a Q & A on COBRA see the Minn. Department of Health web site at www.health.state.mn.us
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Workers' Compensation Advisory Council -4- October 11, 2006
Minutes
GLOBAL CONCERNS/COMMENTS SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS
ISSUE For discussion purposes only
LITIGATION 1. Too much litigation

• Promote alternative dispute-resolution DLI provides mediation services. Before an attorney can charge a fee for a medical or • DLI is developing a marketing tool
systems. Empower employer and rehabilitation dispute, DLI must certify there is a dispute and it has tried to resolve it. The for the ADR process.
employee in ADR to move claim Office of Administrative Hearings also conducts settlement conferences before a hearing
along. Explain the path and is held. DLI also staffs a workers’ compensation hotline to answer questions; assist • Develop incentives based on
successful likelihood of the litigation injured workers, employers and insurers; and intervene when appropriate. willingness to participate in ADR.
process.
• Limit IMEs.
• Educate employees and employers Employers are required to post a poster describing the workers’ compensation system at
about how the system works and why the worksite. Employers must also provide injured workers with an “Employee • DLI is conducting research about
it works that way. Better define and Information Sheet” at the time the employee is given a copy of the First Report of Injury what is disputed, what is the time
explain PPD to the employee. Make it form. DLI prepares the poster and the information sheet, as well as a booklet describing frame for disputes and who
more clear how and when to use the benefits available to injured workers. DLI also has a more detailed description of the disputes.
Medical Request form. system in its "Employee Guide to the Workers’ Compensation System." The DLI Web site
has these publications and other information. • Provide additional educational
offerings for employees and
• Allow the employee to identify another The workers’ compensation law does not prohibit this if the employee consents. The law employers.
member of the family to participate in requires appointment of a guardian for minors and incapacitated employees. (A parent is
resolving disputes. presumed to the guardian of a minor.)
• Consider revising the attorney fee
• Use the collective bargaining The alternative collective bargaining system is no longer limited to construction. formula.
alternative system with employer
groups, beyond construction. • Permit only a Minnesota district court or
Attorney fees of 25 percent of the first $4,000 and 20 percent of the next $60,000 of the Minnesota Supreme Court to award
• Attorney fees are too high. Reimburse benefits awarded are allowable. An attorney may request that a judge award fees above fees that exceed the formula amount
attorneys for “disputed portions of the that amount. Fees for obtaining medical or rehabilitation benefits where the formula is when fees are paid out of employee
claim" only. inadequate or where there are no monetary benefits awarded are paid by the insurer. benefits.
Allowable attorney fees may only be paid on genuinely disputed claims or portions of
claims. Before an attorney can charge a fee for a medical or rehabilitation dispute, DLI
must certify there is a dispute and it has tried to resolve it.

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Workers' Compensation Advisory Council -5-
Minutes
GLOBAL CONCERNS/COMMENTS
ISSUE
2. Length of time to resolve claims and
disputes.
• Ensure consistency between claims
adjusters. DLI should review/define
insurer performance according to
established industry standards. DLI
should more aggressively deal with
insurers that don’t respond timely.
• Implement time frames for payment
of benefits based on the severity of
claims; provide a safety net.
MEDICAL 1. Managed care
• Limit the ability of the employee to
select or change doctors.
• Encourage managed care based on
the value of services rather than just
price.
2. Coding of services is inadequate.
• Have a coding system that works with
insurers located in other states.
• The fee schedule is out of date.
• Provide more defined coding for
vocational rehabilitation services.
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October 11, 2006
SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS
For discussion purposes only
• Mandate claim representative
training. (Currently optional training
DLI reviews all denials of liability and audits all workers’ compensation files for proper is offered three times a year.)
payment of benefits. DLI also provides training to claims adjusters several times a year.
DLI has penalty authority when claims are not paid as required by law. DLI provides • Develop a system to review insurer
annual reports to the Legislature about penalties assessed and about the promptness of performance.
insurers and self-insured employers in making the first payment within 14 days.
• Facilitate the electronic exchange of
The workers’ compensation law provides time frames for payment of benefits and also information to speed up claim
provides for an expedited hearing on disputed claims when the employee can show processing and communication. DLI
financial hardship. is evaluating how to implement an
electronic data-driven system.
The employee covered by a certified managed care plan is allowed to receive treatment • Move from an employee-choice to
from a provider with whom the employee has an established relationship (instead of a employer-choice or limited
provider in the network). Employees who receive treatment by a managed care provider employer-choice of treating
are allowed to change doctors at least once. Employees not covered by managed care provider.
may change once within the first 60 days of treatment; thereafter, the employee must
have approval of the insurer, commissioner or judge. • Allow managed care plans, insurers
and providers to negotiate payment
The rules prohibit a managed care plan from negotiating payment with providers that is incentives.
lower than paid to providers outside the plan.
• Allow employers to contract for
components of managed care
instead of entire package.
The coding system in the fee schedule is national, used throughout the country in the • Enact an automatic rulemaking
public and private sectors. However, the fee schedule is out of date, with CPT codes process that will annually update
from 1997 and 1998, due to the lengthy rule adoption process. medical services codes and fee
schedule in a cost neutral manner.
The rules specify how health care providers should code for meetings and reports
requested by rehabilitation providers.
Workers' Compensation Advisory Council -6-
Minutes
GLOBAL CONCERNS/COMMENTS
ISSUE
3. Correct the payment disparity
between chiropractors and physical
therapists; reimburse all providers at
the same rate.
4. Skyrocketing medical costs, along
with the duration of claims increasing.
• Pay providers commensurate with
payments in general health system.
• Reduce paperwork and administrative
burden for doctors.
• Better utilize the treatment
parameters to encourage early
resolution of disputes.
• Limit hospital charges in general; and
particularly hospitals of 100 or fewer
beds and affiliated clinics.
• Strengthen the neutral doctor option.
• Consider 24-hour coverage insurance.
GENERAL Coverage of mental health injuries related A work-related mental health illness is not covered under the workers’ compensation law
to catastrophic or traumatic events.
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October 11, 2006
SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS
For discussion purposes only
The law was amended in 2005 to increase the maximum fees for chiropractic services • Consider paying chiropractors the
to 72 percent of the fees for medical doctors. As a result, the conversion factors are: same or more than other providers,
medical/surgical services: $76.87; pathology/laboratory services: $64.19; physical while maintaining cost neutrality.
medicine and rehabilitation services: $66.64; chiropractic services: $55.35.
Providers are paid more in workers’ compensation than in the general health system. • Pay providers a set percentage over
Providers are paid the provider’s usual and customary charge or the maximum fee in Medicare.
the fee schedule. For services not in the fee schedule, the provider is paid 85 percent of • Develop a pay-for-performance
the providers usual and customary charge or 85 percent of the prevailing charge as system that will reward doctors who
defined by rule. understand medical components of
the system and provide superior
Providers must complete a one-page report, which includes an MMI and PPD care.
assessment, on request of DLI or the insurer. Doctors must also complete one-page • Require judges to use the treatment
Reports of Work Ability form to facilitate a safe return to work. DLI offers provider parameters in evaluating treatment.
training. • Allow for easier updates to the
treatment parameters.
The Workers’ Compensation Court of Appeals has said judges do not have to consider • Pay small hospitals based on
the treatment parameters to determine whether treatment is appropriate if the attorneys “critical access facility” status rather
do not raise them. than licensed beds. Define when a
clinic is paid at the hospital rate.
Inpatient hospital services and outpatient facility fees are not limited by the fee • Pay noncritical access hospital
schedule, but are paid at 85 percent of the facility’s charge. Inpatient and outpatient nonfee schedule services based on
services at a small hospital are paid at 100 percent. cost-to-charge ratios or at a fixed
percentage of average
The law allows a judge to appoint a neutral doctor, but this is rarely done. reimbursement for all hospitals.
• Adopt a fee schedule for ambulatory
DLI issued a report to the Legislature about 24-hour coverage in 1995. surgery facility fees.
• Extend coverage to mental health
unless it is caused by or results in a compensable physical condition. conditions resulting from work-
related catastrophic or traumatic
events.
Workers' Compensation Advisory Council -7-
Minutes
GLOBAL CONCERNS/COMMENTS
ISSUE
• Cover health care providers who
contract an infectious disease in any
health care setting, including contraction
or exposure without symptoms.
• Injuries or illnesses caused by vaccines
recommended for health care workers by
the CDC should be compensable.
Gross negligence of employer should be
out of the workers' compensation system.
Oct. 10, 2006
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October 11, 2006
SUMMARY OF CURRENT LAW AND PRACTICES1 THEORETICAL SOLUTIONS
For discussion purposes only
Infectious diseases are presumed to be work-related for certain emergency response • Extend the infectious disease
employees exposed to the disease in the course of employment outside of a hospital. presumption to employees in all
health care settings.
An injury or disease resulting from a vaccine in response to a declaration by the federal • Extend coverage of vaccine-related
Department of Health and Human Services to address an actual or potential health risk injuries and illnesses to any vaccine
related to employment is covered by the Workers’ Compensation Act. recommended for health care
workers by the Centers for Disease
Control and Prevention (CDC).
An employee cannot sue the employer outside the workers’ compensation system unless • Allow employees to sue their
the employer intentionally injured the employee. employers for gross negligence.
Workers' Compensation Advisory Council -8-

October 11,
2006
Minutes

David Olson stated the summary was a good document and should be helpful in putting together a
framework for a WCAC legislative package.

Sen. Tom Bakk asked that the WCAC look at coverage of health care benefits for those people who lose
their health insurance when they are hurt on the job. Olson said he would consider it as part of a broader
package; Brener agreed to discuss it.

Brener announced the next meeting is tentatively scheduled for Nov. 29, at 9:30 a.m., and asked
members to put it on their calendars.

The meeting was adjourned at 10:22 a.m.

Respectfully submitted,

Debbie Caswell
Executive Secretary

dc:s

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