Quinn signs workers' compensation reform,but the issue isn't put to rest

By Jamey Dunn

Gov. Pat Quinn signed workers’ compensation reform legislation today that supporters say will save the business community hundreds of millions of dollars, but it may not save him from facing workers' compensation as a campaign issue if he decides to run for governor again. 

Quinn toured the state on a victory lap today, stopping at businesses in Melrose Park, Rockford, Champaign and Marion.

“Today is such an important day. We’re going to be helping the employers of Illinois, the workers of Illinois — all of those who are committed to economic growth — by signing a law that will help our employers in Illinois reduce their premiums for workers’ compensation insurance by a huge amount,” Quinn said in Melrose Park.

Backers of the plan estimate that it will save businesses $500 million to $750 million. The bulk of that savings will come from a 30 percent cut to the rates doctors are paid for treating injured employees. Arbitrators, who decide cases will all be out of a job on July 1. They can reapply but will have to be appointed by Quinn and confirmed by the Senate for three-year terms. Arbitrators can only spend two years of their term working in the same location to prevent them from forming “cozy” relationships with workers. These provisions were spurred in part by an investigation by the Belleville News-Democrat that found Menard Correctional Center employees have been awarded more than $10 million in workers’ compensation benefits. The claims are being investigated by the state. The new law will also:

• Require the use of American Medical Association standards when determining workers’ level of impairment from injuries.
• Apply standards of judicial conduct to arbitrators that are the same as those used for as for the Illinois Supreme Court justices and require them to take additional training
• Allow creation of a provider network of doctors. Injured employees could pick their doctors, but only from this predetermined pool. An injured worker would still be able to visit a doctor outside of the network but could not get a second opinion from a doctor of his or her choice.

Senate Minority Leader Christine Radogno said the new law will improve a system that had become “dysfunctional” for both employers and employees. “Is it a perfect bill? Probably not. I think every single participant in this process would tell you there are a few other things they wished had been in this bill. And we will continue to monitor the progress of the workers’ comp system here in Illinois — first and foremost that our workers are protected, and secondly, that our workers’ comp premiums do not make us noncompetitive with other states.”

House Speaker Michael Madigan shed some light on the behind the scenes process, saying that Quinn was “intimately involved” in negotiations. “Mayor [Rahm] Emanuel of the city of Chicago played a very active and important role on this piece of legislation. It’s not usual for a mayor of a city to get involved with legislation like workers’ compensation before the General Assembly, but Mayor Emanuel chose to do that. He did it. He was very helpful,” Madigan said in Melrose Park.

“At any moment over the last six months this legislation could have been derailed. We could be talking about another missed opportunity for workers’ compensation. Instead bipartisanship showed up. Business and labor worked together. Lawmakers rolled up their sleeves and worked with committed business leaders for reform in our workers’ compensation laws,” said David Vite, president and chief operating officer of the Illinois Retail Merchants Association.

However, Republicans — both in support of and opposed to the plan — said that it did not spread sacrifice evenly. They complained when the bill passed that asking doctors to reduce their rates by 30 percent was an unfair hit to the medical community.

Others have called the savings estimates into question. “I think the actual cost savings are suspect, in part because the range is so great,” said Doug Whitley, president of the Illinois Chamber of Commerce. “I don’t think anybody genuinely knows what the cost savings are going to work out to be.”

He said insurance companies will not start to drop employers’ workers’ compensation insurance premiums until they see that the plan cuts costs. “Realistically, those rate reductions probably will not begin to appear for the next two or three years. … That’s going to take some time to show up.”

Whitley said the Illinois Chamber of Commerce, which remained neutral on the new law, plans to push the issue in the 2012 and 2014 elections. “We should not have to wait another five [or] six years to go back.” He said Illinois must continue to reform its system to be competitive with other states. “The political leadership has to appreciate, understand, recognize that workers’ compensation is not a static action. … Even if we make progress in Illinois, that doesn’t mean that other states didn’t do things similarly. There’s a keeping-up-with-the-Joneses aspect to this.”

Quinn to sign workers' comp reform

By Jamey Dunn

Going back on an earlier statement that he would not give lawmakers another chance to vote on his proposal to reform the state’s workers’ compensation system, Rep. John Bradley ran the bill again today and was able to find enough votes on his side of the aisle to pass it.

Bradley, a Marion Democrat, made no changes to his proposal the second time around. Republicans were consistent with their opposition, as well, though they had additional complaints.

House Bill 1698 (amendments 3 and 5) would:

• Reduce the fees paid to doctors for treating injured employees by 30 percent.
• Require the use of American Medical Association standards when determining workers’ level of impairment from injuries.
• Create new rules for the appointment and conduct of arbitrators, who decide the outcome of claims.
• Allow creation of a “provider network” of doctors. Injured employees could pick their doctors, but only from this predetermined pool. An injured worker would still be able to visit a doctor outside of the network but could not be able to get a second opinion from a doctor of his or her choice.

Current arbitrators would all be out of a job on July 1. They could reapply, but they would have to be appointed by Gov. Pat Quinn and confirmed by the Senate for their three-year terms. Arbitrators could only serve two years in any given area to avoid forming any corrupt, “cozy” relationships with local workers.

“We have an opportunity to fix a broken system. … This about the future of our state. … This is about moving forward and not staying in the past. This is about doing something historic,” Bradley said. He said the bill would save employers $500 million to $700 million annually, according to estimates from the Illinois Department of Insurance.

However, House Republicans took issue with those numbers.

House Minority Leader Tom Cross said Bradley’s estimated savings are “manipulated” and “embellished” and greatly miss the mark. “We may be lucky to get to $100 [million] to $200 million in savings.”

He said the plan would not prevent workers from “doctor shopping to get a desired diagnosis or make workers prove that their injury truly stems from something that took place on the job. Cross said the bill “would do nothing but look good on [campaign] mail pieces and look good in the newspaper as headlines.”

Rep. Roger Eddy, a Republican from Hutsonville, said lawmakers should take more time to work out a more comprehensive reform package that spreads the pain more evenly. He said that because the only “strong” opposition to the bill comes from the health care industry, it seemingly shows that the bill does not ask for enough sacrifice from other groups, such as organized labor and trial lawyers. Republicans opponents, as well as some Senate Republicans who voted in favor of the plan, said it pitted the medical industry — which pushed for a 20 percent reduction in doctor's rates — against the business community.

Eddy said that Bradley’s insistence that drastic changes had to be made by the end of the legislative session — including a threat to dismantle the system if a reform bill could not be passed — were a bluff. He called on lawmakers to take more time and work out a more comprehensive solution.

“This doesn’t have to be done now. This can be done better. It can be done right. Nothing is ‘now or never.’ We proved that in just a short period of time. That ‘this is it’ isn’t really it. It can be something else, and it can be better,” Eddy said.

Quinn has vowed to sign the bill. “The legislation approved by the General Assembly today will also achieve significant saving for the sate of Illinois, as well as attacking fraud and abuse. We have fundamentally changed our system, allowing Illinois to become more competitive and a better place to do business,” he said in a written statement.

Workers' comp reform fails in the House

By Jamey Dunn

As lawmakers forge into the last few days of their spring session, they may soon be voting on dismantling the state’s workers’ compensation system, as well as putting off paying overdue bills even longer.

The Illinois House today shot down House Bill 1698, a workers’ compensation reform package that supporters said would have saved businesses $500 million to $700 million.

Republicans were critical that most of the savings would come from a 30 percent reduction to the rates that doctors are paid for treating injured employees. Members of the health care community have asked lawmakers to change the reduction to 20 percent.  But House sponsor John Bradley, a Marion Republican, said business groups would have pulled support from a plan that reduced fees any less.

Rep. Dan Brady, a Bloomington Republican,  faulted Bradley for not budging on the 10 percentage point difference to gain the medical community’s support. “I heard that the medical community, and I heard that the hospitals say … they would agree to a 20 percent reduction in fees. If that were the case, [would] we have then an agreed bill between business labor, the medical community hospitals and any other stakeholders?”

Republicans who cast “no” votes in both legislative chambers also said the plan did not do enough to reform the system. Senate Republicans who voted in favor of the bill Saturday warned that more work would be needed.

“[Opponents say] we’ve never gone far enough, but we’ve never gone anywhere,” said David Vite, president and chief operating officer of the Illinois Retail Merchants Association. “Every election, candidates from both parties talk about the jobs climate, talk about helping Illinois business, and when it comes right down to it, they didn’t step up to the plate today.”

Both Bradley and Senate sponsor Sen. Kwame Raoul, a Chicago Democrat, expressed frustration that months of negotiations with the powerful groups involved in the system — businesses, doctors, organized labor and trial lawyers — did not produce a bill that made it to Gov. Pat Quinn’s desk. Quinn has publicly supported HB 1698.

“This is a compilation of months of work with many different parties and many different stakeholders in the workers’ compensation process,” Bradley said. Raoul accused House Republicans of casting their votes to protect campaign contributors in the medical community. No House Republicans voted to support the measure.

Now, passage of a bill to dismantle the workers' compensation system that was written off by many as a negotiation strategy is starting to look like a real possibility. Bradley says he does not plan to call the reform bill for another vote in the House, and Raoul said he plans to call Senate Bill 1933, the so-called nuclear option, for a vote in the Senate as early as tomorrow. He said his intention would be to dismantle the system and eventually replace it with a reworked version. In the meantime, workers' compensation cases would go into the courts. “It is a manifestation of the frustration with the inability to change the system,” Vite said. “The consequences of that and the ramifications, I don’t know that anybody understands at this point.”

Lawmakers also shot down one piece of a proposal today to borrow about $6.2 billion to pay off the state’s backlog of overdue bills. Only 19 senators voted in favor of the bill, one of four measures that make up the borrowing plan. Republicans objected to more borrowing on top of the billions in loans the state has taken out to make the required employee pension payment for the last two fiscal years. Sen. John Sullivan, a Democrat from Rushville, said legislators on both sides of the aisle were reluctant to support a large borrowing package before passing a budget plan. He said he plans to push the issue again when budget legislation starts to gel in the coming days.

Meanwhile, a Senate committee approved HB 3188, which would give the state until December to pay off bills from the current fiscal year. The so-called lapse period normally ends in August. However, the General Assembly voted to extend it for last fiscal year and did manage to meet the later deadline, due largely in part to a one-time cash infusion from borrowing against a settlement Illinois received from tobacco companies.

Senate approves workers' comp reforms

By Jamey Dunn

After months of negotiations among that failed powerful interest groups—and threats from lawmakers to completely dismantle the system—the Illinois Senate today passed a measure to overhaul workers’ compensation.

“It’s a good day for employees in the state of Illinois, for job seekers in the state of Illinois,” said Chicago Democratic Sen. Kwame Raoul, the sponsor of House Bill 1698.

Raoul estimates the legislation would result in $500 million to $700 million in savings for businesses in the state. He said the largest cost cutting provision would be a proposed 30 percent reduction to the fees doctors are paid for treating injured workers.


To avoid what Raoul referred to as “doctor shopping,” employees would be given a choice of doctors from a network chosen by employers and approved by the Illinois Department of Insurance. If workers wanted to pick a doctor outside of the network, they would give up their option to seek a second opinion from another out-of-network doctor. Once workers seek a diagnosis, the bill would require doctors to use American Medical Association guidelines to determine the level of impairment. Arbitrators would then take those guidelines into consideration when making decisions on workers’ compensation cases.

If the bill becomes law, all current arbitrators would be out of a job on July 1. They could reapply but would have to be confirmed by the Illinois Senate. The legislation would apply the same standards of judicial conduct to arbitrators as for Illinois Supreme Court justices and require them to take additional training. They would be appointed to three-year terms but could only spend two years working in the same location to prevent them from forming, as Raoul put it, “cozy” relationships with workers. These provisions were spurred in part by an investigation by the Belleville News-Democrat that found Menard corrections workers have been awarded more than $10 million in workers’ compensation benefits. The claims are currently being investigated by the state.

The proposal would cut off lifetime benefits at age 67 or five years after the injury, whichever comes later. It would also cap carpel tunnel benefits at 28 weeks, Raoul said the current average is 40 weeks.

While Greg Baise, president and chief operating officer of the Illinois Manufacturing Association, supports the bill, he said he cannot predict whether the changes will reduce the cost of workers’ compensation insurance for employers.

“It is an epic modernization of an archaic and flawed system. The costs will be reduced by $500 [million] or more. That’s 15 [percent] to 17 percent of the cost in the system today,” said Michael McRaith, director of the Illinois Department of Insurance.

McRaith said the proposal was not “any group’s wish list” but the product of “countless hours [of negotiation] in very warm conference rooms.”

Some Republicans criticized the bill for targeting the doctors for the largest area of savings instead of spreading the pain across other interest groups involved in the system, such as organized labor and trial lawyers. “It appears to me that we’re pitting the business community against the medical community. … I’m disappointed in the fact that we did not come up with a more well-rounded piece of legislation,” said Sen. Bill Brady, a Bloomington Republican.

Members of the medical community asked lawmakers to reduce the fees paid to doctors by 20 percent instead of 30 percent.

“If you would make the changes that we would ask, you would still legislate a workers’ compensation reform bill that would save employers more than $500 million. But the 30 percent fee reduction that’s in this bill is unreasonable an unnecessarily pits health care providers against business,” said Howard Peters, executive vice president of policy and advocacy for the Illinois Hospital Association. “Even at 20 percent, it would mean that hospitals and physicians and other providers would be leaving hundreds of million of dollars on the table.”

Raoul pointed out that a reform package backed by Republicans that failed would have reduced the fees by 30 percent as well.

Many Republican supporters of the bill characterized it as a “step in the right direction," but said more needs to be done to repair the system. They called on fellow lawmakers not to see the passage of the bill as the end of their work on the system. “Our job is not done here. This may not even be getting to first base,” Brady said.

Other members of the minority party said they did not vote for the bill because they feared that lawmakers would consider the system fixed, when in fact the legislation would not go far enough. Sen. Dan Duffy, a Lake Barrington Republican, criticized the bill for not including one of the business community’s biggest requests, a requirement that the primary cause of an injury occurred at the workplace, known as causation.

“One simple sentence would make this piece of legislation worthwhile,” Duffy said. “Sometimes not having any bill at all is better than having a bad bill.”

Raoul said the only way to bring causation into the equation would be to eliminate the system altogether and let employers and workers fight it out in court. He is the sponsor of a bill, which passed the House yesterday, that would do just that. However Raoul did not call Senate Bill 1933 for a vote before a Senate committee that approved his workers’ compensation reform bill today.

Raoul said to his bill’s detractors on the Senate floor: “For those of you all who try to minimize this by saying this is just a step in the right direction, that is absolute nonsense. That is absolute nonsense and you know it. This a major reform in the state of Illinois.”

The measure now awaits a vote in the House. Gov. Pat Quinn said yesterday that he supports the bill.

House approves destruction of workers' comp system

By Lauren N. Johnson and Jamey Dunn

Illinois’ workers’ compensation system, which handles claims filed by injured employees, would be dismantled, and cases would go to circuit courts under a proposal that passed in the Illinois House today.

Senate Bill 1933, sponsored by Marion Democratic Rep. John Bradley, would eliminate the system and transfer claims currently managed by at least 36 arbitrators in the state to Illinois' court system as of January 1. Bradley, who has been active in efforts to produce a workers’ compensation reform package, said elimination is also “a viable alternative to fix a broken system.” The Illinois Workers' Compensation Commission reported that 55,497 new cases were filed in fiscal year 2009.

“Are we going to take back our state? Are we’re going to take back control of what’s going on with injured workers and businesses in the state of Illinois?” Bradley said. “Or are we going to ratify a system that we all acknowledge is broken? That we all acknowledge can do better — should have done better — and didn’t. Are we going to keep banging our heads against the wall with the same old broken song, or are we going to try something new?”

Opponents voiced concern that the flood of workers’ compensation cases would overwhelm the state’s courts. “Sometimes when we have historical issues that we have to deal with, people are willing to step up and do what it takes, and I don’t expect that the courts will be any different,” Bradley said.

Bradley said he thought his bill had more of a chance of making it through the legislature than a plan to reform the system — House Bill 1698, sponsored by Chicago Democratic Sen. Kwame Raoul.

Todd Maisch, vice president of government affairs for the Illinois Chamber of Commerce, disagreed, saying he does not expect Bradley’s bill to be called for a vote in the Senate. “I think that Rep. Bradley is being honest and that he’s exasperated with the system. I do believe that he’s being very straightforward with that, and if nothing else, we think this process has really opened legislators’ eyes to the work comp hell that employers have been suffering with for years and years now,” he said.

Opponents of Bradley’s bill, however, favored Illinois’ workers’ compensation system currently in place to the alternative of no designated system. “The tort system in the state of Illinois has had problem after problem. This is not the way to handle it,” said Rep. Mike Bost, a Murphysboro Republican, before votes were cast. However, Mt. Sterling Republican Jil Tracy, who was one of only three favorable Republican votes. said,. “I think your solution, which is in a sense a complete overhaul in a reverse manner, actually might be the real solution.”

Raoul said the workers’ compensation issue could be addressed in the Senate as early as tomorrow. His  proposal would make a number of changes, including:

• Reducing the fees paid to doctors for treating injured employees by 30 percent.
• Requiring the use of American Medical Association standards when determining workers’ level of impairment from injuries.
• Creating new rules for the appointment and conduct of arbitrators who decide the outcome of claims.
• Allowing for the creation of a “provider network” of doctors. Injured employees could pick their doctors, but only from this predetermined pool.

When asked about the future of Bradley’s bill versus his own, Raoul said, “I’ll have two options.”

Legislators start final push on big issues

By Jamey Dunn and Lauren N. Johnson

With less than a week before their adjournment deadline, Illinois lawmakers are making final attempts to get several large proposals passed in the last days of regular session.

Pension benefits
House Minority Tom Cross submitted his proposal today to reduce future retirement benefits for current state employees. According to Cross' spokesperson, Sara Wojcicki, he plans to present his amendment to Senate Bill 512 in a House committee tomorrow morning. Under the proposal, current employees would be able to keep the benefits they have already earned. But starting July 1, 2012, they would have to pick one of three plans that call for larger contributions or reduced benefits. Employees could stay in their current defined benefits plan, but their contributions would increase:

• State Employees’ Retirement System (SERS) State employees who will also receive Social Security benefits currently contribute 4 percent of their salaries. Under the proposal, they would have to pay 9.29 percent. Members of SERS who do pay into Social Security now contribute 12.5 percent of their pay. They would have to kick in 18.91 percent under the proposal.State Employees’ Retirement System Alternative Plan Members of the alternative SERS system, which includes workers with potentially dangerous jobs, such as prison guards, and who also have an earlier retirement age, contribute 8.5 percent of their salaries now, if they also pay into the Social Security system. Under Cross’ plan, they would have to chip in 16.65 percent of their pay. Those who will not get Social Security pay 12.5 percent of their salary now and would have to pay 18.91 percent.
• Teachers’ Retirement System (TRS) Illinois teachers, except Chicago teachers, currently pay 9.4 percent of their salary and will not receive Social Security benefits. Under the bill, they would have to contribute 13.77 percent. Chicago teachers would see their contributions increase from 9 percent of their pay to 12.75 percent.
• State University Retirement System (SURS) University employees currently contribute 8 percent of their pay. Under the proposed change, they would pay to 15.31 percent.
• General Assembly Retirement System (GARS) Legislators currently contribute 11.5 percent of their income to retirement benefits. They would pay 24.89 percent under the proposed legislation.
• Judges Retirement System (JRS) Judges kick 11 percent of their pay into their retirement. Under Cross’ plan, they would pay 34.04 percent. Lawmakers reportedly considered leaving judges out of the plan, but according to Wojcicki , they will be included in Cross’ proposal.

The amount that employees would have to pay to stay in their current benefit plans would be recalculated every three years.

Under Cross' amendment, employees could also opt to move down to “tier two” of the system — which was passed by legislators in one day during last year’s legislative session — and applies to all employees hired after January 1 of this year. Or they could choose to participate in a self-managed plan, similar to a 401K. Under the self-managed plan, employees who would collect Social Security would contribute 6 percent of their salary, and those who would not would contribute about 4 percent. The state would match those contributions

Employees who chose the old benefits could opt to switch when the rates they must pay are refigured every three years. If they left the so-called tier one plan, they could not return to it but would keep all the benefits they earned under it.

Senate President John Cullerton has said he believes changes to current employee benefits would be unconstitutional. However, he has vowed to call the bill for a floor vote in the Senate if it passes in the House.

Borrowing
A Senate committee today approved a plan to borrow about $6 billion spread out through four proposals to pay down the state’s unpaid bills to vendors, schools, hospitals and local municipalities.  “In some instances, those bills are months and months old; in some cases they are over a year old. So, a tremendous backlog of unpaid bills,” said Sen. John Sullivan, a Rushville Democrat who is backing the legislative package.

Sullivan sponsored four Senate bills that make up the plan and total $6.17 billion:

• SB 342 would pay $1.5 billion owed to state vendors, non-governmental entities and private businesses. Sullivan said vendors have had to take out lines of credit, cut jobs and reduce their services as result of late payments or nonpayment.
• SB 343 would address payments owed amounting in $1.1 billion for health care providers whom the state contracts with for its group health insurance programs.
• SB 344 would restructure debt for private businesses waiting to be paid their corporate tax refunds by paying $800 million to the sector.
• SB 345 would provide the largest amount of money from the state to school districts, universities, community colleges and local units of government, amounting in $2.7 billion. Schools say that have had to make layoffs and cut programs as result of unpaid bills from the state.

Sullivan said his plan would pay off the bonds over the next seven years using money from the recent income tax increase. It would cost the state about $804 million in interest. “Even though it’s slightly different from the variation that we proposed three weeks ago, we think it makes a lot of fiscal sense and economic sense,” said Gary Plummer, president of the Springfield Chamber of Commerce, a group that suggested a similar plan almost a month ago. “It will allow the state to make good on past due bills owed for goods and services provided by agencies and vendors in good faith throughout the state.”

Although, the plan differs from an earlier borrowing proposal by Gov. Pat Quinn that called for borrowing $8.7 billion to be repaid over 14 years, Kelly Kraft, spokeswoman for the governor’s office, said Quinn has remained flexible with his proposal and supports Sullivan’s plan. “Overall, when you’re dealing the budget, it’s a negotiation process, so there’s give and take throughout. So this is something that we do talk about with legislators, as well as the budget,”  Kraft said. “We just want to come up with the best plan for everyone.”

However, the plan will need Republican support in each chamber to get the required super majority needed for the state to borrow. Senate Republicans, who have opposed additional borrowing, agree that individuals and businesses owed by the state should be paid in a timely matter but suggest that there are other ways to address the backlog. Sen. David Luechtefeld, an Okawville Republican, remarked: “Yes, you want your money, but it’s not going to be too long before those bills are going to go right back up because there’s no way to pay them anymore. We’ve borrowed too much.” Cullerton said Senate Democrats are looking for the Republican backing needed to pass the borrowing plan. “That will take some time,” he said.

Energy
House members are supporting a new version of a controversial proposal that would allow utility companies to raise rates while also requiring them to invest in infrastructure, as well as a proposal to build a coal plant that would utilize carbon emission reducing technology.

SB1652 would allow Commonwealth Edison and Ameren, the state's largest electric utilities, to increase customers’ rates by up to 2.5 percent annually and would require both companies to invest a combined $3.2 billion  in infrastructure to upgrade the existing electric gird and add so-called smart grid technology. Unlike in previous incarnations of the plan contained in House Bill 14, the Illinois Commerce Commission, which currently has to sign off on rate hikes, would decide on the increases.

The measure would also require utilities to meet benchmarks for customer service and reliability. The ICC would monitor the progress, and the utilities would face fines if they failed to meet the goals. The ICC would also review rates in 2014, and the entire bill would sunset in 2017, meaning lawmakers would have to approve it again.

David Kolota, executive director of the Citizens Utility Board, said the changes to the proposal are encouraging, but he said the customer-service benchmarks may be set too low.

On the policy front, on smart grid policy, it’s definitely a significant step forward,” said Kolota, whose consumer advocacy group opposed the original plan. “All [the previous plan] said was, ‘We’re going to do smart grid.’ It was like one sentence.” He said he is concerned that the rate cap is only in place until 2014. “We certainly wouldn’t want to see a situation where consumers are soaked and suddenly get hit with a significant rate increase.”

Orland Park Democratic Rep. Kevin McCarthy, a sponsor of the bill, acknowledged that the changes will not be enough to please all stakeholders. “I don’t pretend that these changes are everything some of our colleagues wanted.”

Sen. Mike Jacobs, an East Moline Democrat who sponsors the bill in his chamber, said the benefits that customers will see in future savings, as well as in more reliable power, are worth the up-front investment of higher rates,which sponsors estimate will average about $3 per household each month. “You can’t base this off price. That’s kind of silly. We’re dealing with hundred-year-old technology, and if consumers want something to work, they’ve go to pay for it. And the fact is, it costs money, and you know there’s nothing for free. My cable bill went up $10 a month last month nobody even asked me if they could raise it,” Jacobs said.

The changes were not enough to win the support of one vocal opponent, Attorney General Lisa Madigan. “A day after winning a $156 million rate increase, ComEd just can’t help itself. Today, their legion of lobbyists continue to push legislation that will require consumers to fund billions more in guaranteed profits. This new proposal is just more of the same — a plan that hits consumers where it hurts the most — their wallets,” Madigan said in a written statement. The ICC approved a ComEd Rate increase yesterday. Gov. Pat Quinn, who vowed to veto the earlier version of the plan, declined to weigh in on today’s proposal.

“If you want to vote in this General Assembly, run for the office,” Jacobs said in response the Madigan’s opposition.

Meanwhile, the attorney general did throw her support behind an attempt to resurrect a plan to help Tenaska Energy build a “clean-coal” plant near Taylorville. Paul Gaynor, chief of the Public Interest Division of the attorney general’s office, said that the Tenaska plant is a better investment for Illinois utility customers, calling the plan rate neutral. Energy generated by the plant would initially come at a greater cost, but supporters say that a provision giving the Illinois Power Authority more flexibility in purchasing power would result in savings that could negate any substantial rate increase.

Northbrook Democratic Rep. Elaine Nekritz, one of the House sponsors of SB 1653, said she hopes to get the plan through both chambers before the end of the regular session on Thursday.

Budget
Senate President John Cullerton said that the House and Senate are working to bring their proposed budget numbers in line and that a vote could come over the weekend. He said the Senate will likely come down to the House’s revenue estimate, which is $1 billion less than the estimate contained in the budget proposal passed by the Senate. Echoing House Speaker Michael Madigan, Cullerton said revenue that comes in beyond the estimate could be used to pay off overdue bills.

Workers' compensation
A House committee approved SB1933, which would repeal the current worker’s compensation system. House Democrats, including Speaker Madigan, have threatened to destroy the current system if stakeholders cannot agree on a reform package. The legislation would force any worker's compensation claims into the courts. The bill is sponsored by Marion Democratic John Bradley, who has been working on negotiations. Bradley said that the passage of the bill was not a indication that talks had fallen apart, but said he wanted to keep all options open. Cullerton said, “I think we’re really close to an agreement on workers’ comp — an agreement on workers’ comp among a number of the stakeholders.”

Redistricting
Cullerton also said he expects some changes to the Senate Democrats’ proposed legislative map to surface tomorrow and that the proposed map of congressional districts would come sometime after that.

Tomorrow is expected to be a busy day for the legislature. Check back for updates.

Republicans' workers' comp reforms fail

By Jamey Dunn

The Illinois Senate today shot down a workers’ compensation reform bill backed by Republicans and the business community.

“This workers' compensation bill is the first sign of hope that companies currently have in Illinois. Without this bill, and without real workers’ compensation reform, there is no good news or reason to keep your company in Illinois,” Rep. Dan Duffy, A Lake Barrington Republican, said of Senate Bill 1349 during debate on the House floor.

The legislation, sponsored by Lebanon Republican Sen. Kyle McCarter, would have:

• Cut the fees paid to doctors who treat workers’ compensation patients by 30 percent.
• Created a “causation” provision, which could have required that an injury be at least 51 percent job-related to be eligible for workers’ compensation. (This issue is perhaps the most volatile subject of negotiations, with many in the business community viewing it as a deal breaker.)
• Required that American Medical Association guidelines be used to determine impairment
• Required that injured employees be treated by a doctor of the employer's choice for the first 60 days after the injury occurred
• Created stricter penalties for fraudulent claims that involve seeking payment for a medical service that was not provided.

Democrats said it was premature to pass a bill while negotiations are still ongoing between the stakeholders. “Workers’ comp overhaul is clearly the single most important piece of legislation we can pass in this session to prove we’re serious about improving the business climate,” said Senate President John Cullerton. He added that if senators truly want to change the system, they must negotiate a bill that would pass in the House, and that Gov. Pat Quinn, who has his own package of proposed workers’ compensation reforms, would sign.

Republicans accused Democrats of being unable to stand up to labor unions and trial lawyers, traditionally their political allies, to make needed but potentially painful changes. “I don’t know what will finally happen with this. But if it isn’t strong enough to make a difference, forget it. We’re wasting our time if we can’t compete with our neighboring states,” said Sen. David Luechtefeld, a Republican from Okawville.

Quinn's workers' comp plan not enough for business

By Jamey Dunn

Gov. Pat Quinn, legislative leaders and the business community agree that legislators need to approve substantial workers’ compensation reforms by the end of the spring legislative session, but what a reform package would look like is still unclear.

“This is one of our No.1 issues in Illinois, this year. We’re going to get it done this year,” Quinn said as he presented the broad strokes of his reform proposal during an Illinois Chamber of Commerce event today. His plan calls for new standards for arbitrators who make decisions on workers’ compensation cases and “enhanced authority” to investigate fraud. Quinn also wants to limit arbitrators' terms to three years and subject them to performance evaluations. Under Quinn’s proposal, workers who are injured while intoxicated would not be eligible for benefits.

The plan Quinn described was short on details, but he did provide estimates for cost savings for businesses: “Our plan would save even more than $500 million.”

Quinn’s proposal calls for reducing fees doctors are paid by 30 percent, which he estimates would save $500 million alone. He also calls for returning compensation for partial permanent disabilities to levels paid out before 2005, a move he says would save $40 million. He also proposes to cap benefits for carpal tunnel syndrome, which he says would save about $19 million. Quinn has yet to introduce his plan introduced in legislation for lawmakers to consider.

However, Quinn’s plan did not address the issue of causation, which representatives of the business community say is their top priority. Businesses want employees who make a workers’ compensation claim to prove that their injuries are caused, at least in part, by their work.

“In Illinois, the threshold for a workers’ comp claim is extremely low. Somehow, we have got to raise that threshold,” said Doug Whitley, president of the Illinois Chamber of Commerce. “Right now, an employee who starts work tomorrow can file a worker’s comp claim for all previous experience that’s probably not job-related. We need to have workers’ comp be (for) a job-related injury.” Whitley said Quinn's plan had some positive changes, but without taking up causation, it's not enough.

However, Marion Democratic Rep. John Bradley, who worked on a workers’ compensation reform legislation that stalled at the end of last session, said that for businesses to have the causation requirements they are seeking, cases would have to go back into the court system. He said if interest groups cannot agree on a compromise reform package, it would be better to just do away with the system completely

“If you’re not going to take the action to reform the system, then let’s do away with the system,” Bradley said during floor debate of House Bill 1032. “I’m saying that the comp act currently is not providing for the general well being of anybody.” CORRECTION: The House approved the removal of some procedural roadblocks to Bradley's bill, but has yet to vote on the bill itself. Bradley's workers' compensation bill is House Bill 1032. It was listed here as House Bill 3428, which instead repeals a variety of other provisions relating to farming and labor. 

Although the House approved Bradley’s bill, Whitley said he does not take the proposal seriously. “I think that’s more for show and drama than it is for reality.”

Bradley emerged frustrated from his attempts at negotiating changes to the workers’ compensation law, and most everyone involved agrees that hammering out a compromise between some of the biggest interest groups associated with Illinois government—business, the health care sector, unions and trial lawyers—will not be easy.

“I know that there are many interest groups that want to stand still. They don’t want to change. They kind of benefit from the status quo,” Quinn said. “There will be some pain, there will be some sacrifice, but nobody is going to get scalped in our reform. Maybe some folks would get a haircut, but nobody’s going to get scalped.”

Senate President John Cullerton said there is opposition to change on both sides of the aisle. He warned that any interest group digging in and making a given issue a “deal breaker” would be counter productive to negotiations. “We’ve really narrowed—I think—a lot of the issues. There’s still three of four left that are very important. Always in politics, you try to do things that save a little face for both sides, and that’s what we’re going to be trying to do. But it’s not easy.”

Quinn fires back on budget

By Jamey Dunn

Gov. Pat Quinn said today that he supports a budgeting process driven by legislators; however, he said he would not sign off on big cuts to some of the largest areas of state spending.

After his budget proposal took a beating from lawmakers in Springfield this week, Quinn shared some of his opinions with reporters in Chicago today.

He responded to House Speaker Michael Madigan’s statement earlier this week that the governor had asked for the legislature to send him a lump sum budget, as they have the last two years, and allow him to make the tough choices. Madigan said he told Quinn that he didn’t think lawmakers would go for that plan again this year.

“I really didn’t ask for it,” Quinn said.

He said he asked Democratic legislative leaders if it was their “intention” to conduct the budgeting process that way again this year.

“I said, 'if you guys want to do that, that’s the will of the legislature — the members— then we’ll take it on and do it in the third year, the way we have in the first two.'  But I didn’t say they should do that. I actually like the fact that the legislators are line-item by line-item going through the budget. My first two years, I was told they didn’t want to do that. They didn’t want to make cuts,” he said.

Quinn said if lawmakers have budget proposals this year he would be “happy to look at those.” However, he seems to be a long way from getting on board with the House’s lean budget proposal , which calls for cuts to education and human services. “Severe radical cuts in education and in decent health care and in human services and public safety, I’m not going along with that. I think it’s very important that we maintain the core priorities of Illinois. And we’re not losing a generation of children and their education, and we’re not going to take away health care from people who have nothing at all. We have to make sure we have a decent society.”

Madigan shot down Quinn’s proposal to borrow $8.75 billion dollars to quickly pay off the state’s backlog of bills. The borrowing would be repaid over 14 years. The speaker said that lawmakers have little interest in passing the bill. Instead, the House plan currently calls for paying off overdue bills with any money that might come in that exceeds the chambers “conservative” revenue projection for fiscal year 2012.

Quinn did not waver from his plan. “The money is already owed. We already owe the money. It’s not like we’re borrowing new money," he said. "I haven’t given up on that. Ultimately, it’s got to happen. We cannot tolerate a situation where good businesses in Illinois are having to wait half a year, six months, to get paid on bills that they have provided services for. …We can’t just keep pushing forward $8 billion worth of debt.” Quinn’s estimate of the state’s unpaid bills also includes costs besides those owed to schools, socials service providers and vendors, such as late income tax refunds for corporations and money owed to the state’s employee health care system.

He called on lawmakers to quickly approve a smaller borrowing plan of about $2 billion, which he says would allow the state to capture about $200 million in federal funds under an elevated Medicaid matching rate that expires in June. Some of the money would also go to the employee health care system, which was under funded for the current fiscal year. “Everyone in Springfield, Democrats and Republicans, they can beat their breasts all they want about restructuring debt. The bottom line is: if we’re going to sacrifice and give up almost a quarter billion dollars, that’s foolhardy; that’s not the way to go. … At least [on] the [Medicaid], let’s get going and get the job done.”

Quinn said he plans to roll out a workers’ compensation reform package next week. He said he has been talking to legislative leaders and is trying to work out a proposal that would have bipartisan support in both chambers.http://illinoisissuesblog.blogspot.com/2011/03/legislators-balk-at-quinns-education.html
He said, "We're going to past this, this year."

Workers' Comp reform "swimming in data"

By Jamey Dunn

Proponents of workers' compensation changes say Illinois’ system is unnecessarily complicated, and the math for medical fees just doesn’t add up. Meanwhile, representatives of the medical community say Illinois is moving too quickly on the issue.

Barb Malloy, consultant and former workers’ compensation administrator for the city of Chicago, said that medical fees employers pay for injured worker’s treatment in Illinois outpace what the state and federal government pay under medical programs for the low-income and elderly residents. Malloy said a standard visit to a doctor costs $24.25 under Medicaid, $42.99 under Medicare and $77.81 under workers’ compensation requirements in Illinois.

She told the House Workers’ Compensation Reform committee that. unlike the Federal Medicare program, the workers’ compensation system does not determine costs based on how complicated a procedure is, such as a surgery taking more time and effort from health care professionals than a check up.

Mark Deaton, general counsel for the Illinois Hospital Association, said that as some of the largest employers in the state, hospitals are sensitive to costs of workers’ compensation. However, he warned that budget cuts and substantial federal health care reforms make it a dangerous time to do any major tweaking to Illinois’ health care sector.

“First do no harm. I would like all of us to bear that maxim in mind as we discuss this issue because the potential for harm is extremely high here — harm to injured workers, harm to employers, harm to the economy of the state, harm to our healthcare system. … Right now in the state of Illinois there are a lot of hands and a lot of fingers jostling that house of cards that we call health care,” he said at the hearing held at Illinois State University in Normal.

Deaton called for legislators to slow down and return to the so-called agreed bills process that has been used to make changes to workers’ compensation in the past. Under this method, stakeholders hammer out negotiated legislation that all parties approve. However, this method usually prevents any sweeping changes. “Please do not rush to a solution. … It’s abundantly clear that this is an incredibly complex, multifaceted issue with many moving parts. The last time we had a major reform … it took about two years to work it out. And today’s landscape is even more precarious.”

He added: “There is no public policy reason whatsoever that we have to solve this problem between now and the middle of January, [the deadline for the Senate and House committees to make reconditions about workers' comp, as well as the end of the lame-duck session.] The system is not on the verge of collapse. … I don’t believe that a single business in the state of Illinois is going to relocate if there are not changes made to workers’ comp in January, especially if there is the prospect of meaningful reform on the horizon.”

However, Rep. Jim Sacia, a Pecatonica Republican, said he was alarmed by Deaton’s statement about the urgency of the situation. Sacia said there is at least one business in his district that is considering moving out of Illinois,  largely in part because of workers’ compensation costs.

Eugene Munin, budget director for the city of Chicago, said the city has seen workers’ compensation costs rise while the number of city employees decreased. Munin said the city has eliminated around 6,000 positions in the last 10 years because of budget cuts. He said the city had 2,000 workers’ compensation claims in 2005 and had 1,350 in 2009. But workers’ compensation cost Chicago $61 million in 2009 versus $38 million in 2005.

“Our costs have increased … even while the number of employees the number of claims have gone down dramatically,” he said.

Deaton said the issue of workers’ compensation is “swimming in data that is often contradictory." That is why he thinks experts should be given the chance to work out a compromise. “There are a lot of very very smart people on both sides of this issue.”

He said legislators should remember that being injured at work can be traumatic, and access to quality health care is important to get workers back on their feet. “Somebody who is injured [at the workplace] in Illinois and needs medical attention has one thing going for them. They have access to some of the finest doctors and hospitals that this country has to offer.”

Tom Mercier, president of Bloomington Offset Process, Inc. and a board member of the Illinois Manufacturers Association, said employers want to make things right for their workers who are injured on the job. He takes issue with employers having to pay the full cost of treatment for conditions, which may be caused or contributed to by outside activities.

“If someone is hurt on the job. we look at it as our responsibility to get that person … fixed. …Our questions come about when there isn’t a definitive reason for why that person needs a double hernia operation. Was it because something that happened at work or was it something that happened on the weekend because he is part of a band? Is it something in which someone needs an operation … that is a bindery-hand-work person but at nights and on the weekends she’s a seamstress? It is those things that make our job difficult,” he said.