tnsia 2010 conference presentation

4th Annual Conference

September 16, 2010

Willis Conference Center

Nashville, Tennessee

Agenda

7:30 - 8:00 Registration, Continental Breakfast, Visit Vendor Booths

8:00 – 8:30Opening Remarks / TNSIA Business Meeting

8:30 – 9:30Craig MacFarlane – Keynote Motivational Speaker

9:30 – 10:00 Terry Hill - Workers’ Compensation Legislation / Case Law

10:00–10:30 Break & Visit Vendor Booths in Refreshment Center

10:30 – 11:00 Mike Shinnick - TN Department of Commerce & Insurance

11:00 – 11:30 Sue Ann Head & Pete Halverstadt - TN Dept of Labor & Workforce Development

11:30 – 12:30 Lunch in Atrium & Visit Vendor Booths

12:30 - 1:30 Steve Gill, Political Radio and Television Commentator

1:30 – 2:00 Break & Visit Vendor Booths in Refreshment Center

2:00 – 3:00Mock Benefit Review Conference / Request for AssistanceKatherine (Kitty) Boyte - Constangy, Brooks & Smith, LLPBill Easterly - Bill Easterly & Associates PCPatrick Ruth – Mediator, Dept of Labor

3:00 – 3:15Door Prizes

3:15 –4:00 Hospitality Room in Refreshment Center

Gold Sponsor Gold Sponsor 20102010

Tennessee Self-Insurers’ Tennessee Self-Insurers’ Association ConferenceAssociation Conference

Opening Remarks – TNSIA Business Meeting

Terry Hill – TNSIA Executive Director

Gary Eastes – TNSIA Chairperson

Micheline Parkey - Treasurer

TNSIA AccomplishmentsTNSIA Accomplishments– Legislative Bills passed: Legislative Bills passed:

SB 1574 deals with the Overstreet decision and allows us to communicate with the authorized treating physician under SB 1574 deals with the Overstreet decision and allows us to communicate with the authorized treating physician under certain conditions. certain conditions.

SB 1909 places very specific restrictions on the ability to recover when injured during a recreational activity. SB 1909 places very specific restrictions on the ability to recover when injured during a recreational activity.

SB 1567 prevents an employee from reopening his case if the employer is bought out by another company and retains the SB 1567 prevents an employee from reopening his case if the employer is bought out by another company and retains the employee at the same or greater pay. employee at the same or greater pay.

SB 2162 makes it clear that an employee who is an illegal alien may not recover more than 1.5 times his impairment rating.SB 2162 makes it clear that an employee who is an illegal alien may not recover more than 1.5 times his impairment rating.

– Drafted Legislation for 2010 Legislative Session, including the following:Drafted Legislation for 2010 Legislative Session, including the following:Bill on closing medicals.Bill on closing medicals.

Bill on repetitive motion injuries.Bill on repetitive motion injuries.

Bill dealing with the Hartco Flooring case. This bill prohibits reconsideration when pay is the same or greater at the time of Bill dealing with the Hartco Flooring case. This bill prohibits reconsideration when pay is the same or greater at the time of trial.trial.

Bill dealing with reconsideration when the employees take a cut in pay due to economic conditions or when the employer is Bill dealing with reconsideration when the employees take a cut in pay due to economic conditions or when the employer is forced by economic conditions to temporarily cut hours.forced by economic conditions to temporarily cut hours.

Bill dealing with pain management.Bill dealing with pain management.

– Welcomed 5 New Board MembersWelcomed 5 New Board MembersGoodyear Tire – Randy TriplettGoodyear Tire – Randy Triplett

Ingram Industries – John HayesIngram Industries – John Hayes

International Paper – Penny HumphreyInternational Paper – Penny Humphrey

Johnson Controls – Ronald JonesJohnson Controls – Ronald Jones

McKee Foods Corp. - Micheline ParkeyMcKee Foods Corp. - Micheline Parkey

Marvin Windows & Doors of Tennessee – Kent CarterMarvin Windows & Doors of Tennessee – Kent Carter

Statement of Income and Expense

2010

From

1/1/2010

Cash Beginning of Year $ 61,198.00

Membership Due

2010 Memberships $ 16,500.00

2011 Memberships 650.00

Conference

Attendees 7,375.00

Sponsors 16,750.00

Total Revenue $ 41,275.00

Expenses

Web Hosting ($495/Month) $ 3,960.00

Manier & Herod ($2,000/Month) 11,000.00

Amicus Brief -

National Council of Self Insurers 444.00

Tennessee Chamber of Commerce -

Conference 3,183.95

Paypal 424.90

Tax Preparation 1,115.50

NCSI National Conference 3,811.20

Guarantee Fund -

Insurance -

Bank Charges 122.72

Total Expenses $ 24,062.27

Total Income $ 17,212.73

Cash On Hand as of August 31, 2010 $ 78,410.73

Executive DirectorTerry Hill

Ajax Turner CompanyTodd Williams

Averitt Express, Inc.David McDowell

Cracker Barrel Old Country Store, Inc.

Rob Behnke

General Motors LLCSusan Azar

Goodyear Tire and Rubber CoRandy Triplett

Ingram Industries Inc.John Hayes

International Paper Penny Humphrey

Johnson Controls, Inc.Ronald Jones

Marvin Windows & DoorsKent Carter

Nissan North America, Inc.Mike Berger

Parker Hannifin CorpCurtis Gross

Tyson Foods, Inc.Allyn C. (Lynn) Tatum

United Road ServicesKristin Burman

Wasco, Inc.Paul Kneedler

Board of Managers

City of Knoxville McKee Foods CorporationGary Eastes– Chairperson Micheline Parkey - Treasurer

TNSIA Regular MembersTNSIA Regular MembersAjax Turner Company, Inc.

American Electric Power Service Corp.

Ascension Health

Averitt Express

City of Knoxville

Cracker Barrel Old Country Store, Inc.

Det Distribution

Eaton Corporation

Ford Motor Company

General Motors LLC

Goodyear Tire & Rubber Company

Harrah's Entertainment, Inc.

Ingram Industries Inc.

International Paper Company

Johnson Controls, Inc.

Kennametal

Kroger

Marvin Windows & Doors

McKee Foods Corporation

Nationwide-Express

Nissan North America, Inc.

Parker -Hannifin Corporation

St. Jude Children's Research Hospital

The Pictsweet Company

Thompson Machinery

Tyson Foods, Inc.

United Road

Vanderbilt University

Wasco, Inc.

TNSIA Associate MembersTNSIA Associate Members

AccessOnTime

Alternative Service Concepts

AON Risk Services

Beecher Carlson Insurance Services

Berkley Risk Administrators Company

Brentwood Services

Brewer, Krause, Brooks, Chastain & Burrow

CapRisk Consulting

Carlisle Medical, Inc.

Casualty Actuarial Consultants

Collins and Company

Commercial Insurance Associates

Constangy, Brooks & Smith

NuQuest/Bridge Pointe

One Call Medical

Physical Therapy Provider Network

Premier Radiology

Prime Health Services

Ringler Associates Nashville

Sedgwick Claims Mgmt Services

Select Actuarial Services

Specialty Risk Services

Tennessee Chamber of Commerce

Tennessee Urgent Care Associates

Tristate Claims Services

Waldrop & Hall

Wells Fargo Disability Management

Willis of Tennessee

Coventry Work Comp Services

Diagnostic Healthcorp

Eckman/Freeman & Associates

Fara Insurance Services

GENEX Services

Harmony Hearing Services

Heartland Care management, Inc.

Heffernan Insurance Brokers

Innovative Risk Consulting

Johnston & Associates

Leitner, Williams, Dooley & Napolitan

Manier Herod

Marsh U.S.

Moore Ingram Johnson & Steele

Occusure Work Comp Specialists

Agenda














Craig MacFarlane

Keynote Motivational Speaker

Agenda














Tennessee Work Comp UpdateTennessee Work Comp Update 2010 Statutes 2010 Statutes

Passed by the Tennessee LegislaturePassed by the Tennessee Legislature Case LawCase Law

Terry HillTNSIA Executive Director

Problems with Future MedicalProblems with Future Medical

Public Chapter No. 858Public Chapter No. 858 gives the gives the Department of Labor Specialist authority to:Department of Labor Specialist authority to:

1.1. Order employer to provide specific medical Order employer to provide specific medical care and treatment; care and treatment;

2.2. Order medical benefits; andOrder medical benefits; and

3.3. Award attorney’s fees and reasonable costs, Award attorney’s fees and reasonable costs, including court reporter expenses and expert including court reporter expenses and expert witness fees.witness fees.

Problems with Pain Problems with Pain Management/Maximum Management/Maximum

Medical ImprovementMedical Improvement

Public Chapter No. 920Public Chapter No. 920 clarifies the date of clarifies the date of maximum medical improvement when pain maximum medical improvement when pain

management is involved. management is involved.

The Chapter provides that a person is conclusively The Chapter provides that a person is conclusively presumed to be at MMI upon the earliest of the presumed to be at MMI upon the earliest of the following events:following events:

1.1. At the time the treating physician concludes At the time the treating physician concludes that the Employee has reached MMI; or that the Employee has reached MMI; or

2.2. 104 weeks after the commencement of pain 104 weeks after the commencement of pain management treatment.management treatment.

Return to Work at Reduced Hours Return to Work at Reduced Hours or Reduction in Pay Due to the or Reduction in Pay Due to the

EconomyEconomy

Public Chapter No. 1034Public Chapter No. 1034 prevents employees prevents employees from reopening their cases when, due to the from reopening their cases when, due to the economy, the Employer has had to cut back on the economy, the Employer has had to cut back on the hourly pay or cut back on the amount of hours hourly pay or cut back on the amount of hours worked. The bill excludes employees involved in worked. The bill excludes employees involved in layoffs, closure, or a termination of business layoffs, closure, or a termination of business operations.operations.

Workers’ Compensation Workers’ Compensation Requirements for Requirements for

Construction WorkersConstruction Workers

A bill passed in 2008 that was intended to require A bill passed in 2008 that was intended to require that all construction workers be covered by workers’ that all construction workers be covered by workers’ compensation. However, many solo employers compensation. However, many solo employers complained that the coverage was too expensive. complained that the coverage was too expensive. The House and Senate have agreed upon a The House and Senate have agreed upon a bipartisan bill that allows solo proprietors, partners, bipartisan bill that allows solo proprietors, partners, LLC members, etc. to exempt themselves from the LLC members, etc. to exempt themselves from the workers’ compensation coverage requirements. workers’ compensation coverage requirements. This involves specific filings with the Secretary of This involves specific filings with the Secretary of State’s office. State’s office.

The Case LawThe Case LawAll cases presented, except for the last two

cases are decisions from the Tennessee Supreme Court’s Special Workers’ Compensation Panel, which is the

equivalent of a Court of Appeals right above the trial court level.

Before we get started, there is one preliminary matter we need to

address...

which is the problem of ....

Acronyms!!!

The Promise

Why do I call it the “problem” of acronyms?

Personal Experience: My father-in-laws’ retirement from the “SSA”

Never again will I torture people in a presentation with acronyms by

assuming they know what they mean.

Ten Acronyms You Need Ten Acronyms You Need to Know in Tennesseeto Know in Tennessee

Permanent Total Disability

Permanent Partial Disability

Second Injury Fund - a/k/a “the Fund”

Body as a whole or WP for whole person

Authorized Treating Physician

1. PTD =

2. PPD =

3. SIF =

4. BAW =

5. ATP =

Ten Acronyms You Need Ten Acronyms You Need to Know in Tennesseeto Know in Tennessee

Independent Medical Evaluation

Medical Impairment Rating Registry

The Tennessee Department of Labor

Benefit Review Conference

Request For Assistance

6. IME =

7. MIRR =

8. DOL =

9. BRC =

10. RFA =

The Traveling EmployeeThe Traveling Employee

MCDONNELL V. CONTINENTAL MACHINE MCDONNELL V. CONTINENTAL MACHINE MOVERSMOVERS.,., NO. M2008-00968-WC-R3-WC NO. M2008-00968-WC-R3-WC

TN employee assigned to Kentucky jobsite.TN employee assigned to Kentucky jobsite.

Employer paid for food & lodging.Employer paid for food & lodging.

Employee had an apparent seizure while waiting Employee had an apparent seizure while waiting for co-workers to return from breakfast.for co-workers to return from breakfast.

IME said seizure caused shoulder dislocation.IME said seizure caused shoulder dislocation.

Trial court ruled injury as compensable because Trial court ruled injury as compensable because employee was a “traveling employee.”employee was a “traveling employee.”

The Traveling EmployeeThe Traveling Employee

MCDONNELL V. CONTINENTAL MCDONNELL V. CONTINENTAL MACHINE MOVERSMACHINE MOVERS.,., NO. M2008-00968- NO. M2008-00968-WC-R3-WCWC-R3-WC

Employer appealed.Employer appealed.

Panel decided that injury did not arise out of Panel decided that injury did not arise out of employment.employment.

Panel reversed the trial court decision.Panel reversed the trial court decision.

Psychological Injury Following TraumaPsychological Injury Following Trauma

CATES V. BODY PANELS COMPANY, INCCATES V. BODY PANELS COMPANY, INC.,., 2009 2009 WL 910214WL 910214

Employee fell from a ladder at work:Employee fell from a ladder at work:

Orthopedic surgeon released employee with no Orthopedic surgeon released employee with no physical impairment, no restrictions, and recommended physical impairment, no restrictions, and recommended psychiatric evaluation.psychiatric evaluation.

Psychiatrist opined depression, panic disorder and Psychiatrist opined depression, panic disorder and post-traumatic stress disorder (PTSD) were related to post-traumatic stress disorder (PTSD) were related to the fall, permanent, & disabling.the fall, permanent, & disabling.

Trial Court awarded Perm Total Disability (PTD) and Trial Court awarded Perm Total Disability (PTD) and the Panel Court affirmed.the Panel Court affirmed.

SuperdoctorSuperdoctor

Presumptive Correctness of MIRRPresumptive Correctness of MIRRWILLIAM KEVIN BEELER V. LENOX WILLIAM KEVIN BEELER V. LENOX HEARTH PRODUCTS, INC.HEARTH PRODUCTS, INC., 2009 WL 396121, 2009 WL 396121

Treating physician assigned 2% impairment.Treating physician assigned 2% impairment.

At employees request, an IME was conducted At employees request, an IME was conducted with the evaluating physician assigning 7% with the evaluating physician assigning 7% impairment.impairment.

To resolve the disparity, the parties selected a To resolve the disparity, the parties selected a neutral physician from Medical Impairment Rating neutral physician from Medical Impairment Rating Registry (MIRR) to conduct an examination.Registry (MIRR) to conduct an examination.

MIRR physician concluded that 3% was the accurate impairment rating.

Panel affirmed Trial Court’s reliance on MIRR doctor.

Presumption applies unless there is clear and convincing evidence to the contrary.

Presumptive Correctness of MIRRPresumptive Correctness of MIRR

BERTHA MAI CLAIBORNE V. ABC BERTHA MAI CLAIBORNE V. ABC GROUP FUEL SYSTEMS, INC.GROUP FUEL SYSTEMS, INC., 2009 WL , 2009 WL 40171674017167

Authorized Treating Physician (ATP) released Authorized Treating Physician (ATP) released employee with employee with no impairment. impairment.

Employee’s evaluating physician assigned Employee’s evaluating physician assigned 10% impairment.10% impairment.

Parties invoked MIRR process.Parties invoked MIRR process.


BERTHA MAI CLAIBORNE V. ABC GROUP FUEL SYSTEMS, INC., 2009 WL 4017167

MIRR physician assigned 0% impairment.

Trial Court applied 10% rating, with no clear and convincing rebuttal of MIRR physician’s opinion.

Upon review, the trial court was reversed & the case was remanded for additional consistent proceedings.


Exhaustion of Benefit Review ProcessExhaustion of Benefit Review ProcessTHE HOLLAND GROUP V. AUDREY THE HOLLAND GROUP V. AUDREY SOTHERLAND, ET AL.SOTHERLAND, ET AL., 2009 WL 1099275, 2009 WL 1099275

Employer filed suit after Department of Labor (DOL) Employer filed suit after Department of Labor (DOL) issued an Order for Benefits on the Employee’s issued an Order for Benefits on the Employee’s Request for Assistance.Request for Assistance.

Employer denied the claim and sought Employer denied the claim and sought reimbursement for the cost of benefits provided reimbursement for the cost of benefits provided pursuant to the DOL order.pursuant to the DOL order.

Employee eventually answered the lawsuit and Employee eventually answered the lawsuit and counter-claimed for benefits.counter-claimed for benefits.

Neither the employer nor employee filed a Request Neither the employer nor employee filed a Request for Benefit Review Conference (BRC).for Benefit Review Conference (BRC).

THE HOLLAND GROUP V. AUDREY THE HOLLAND GROUP V. AUDREY SOTHERLAND, ET AL.SOTHERLAND, ET AL., 2009 WL 1099275 , 2009 WL 1099275

The Second Injury Fund (SIF) (The Fund) filed a The Second Injury Fund (SIF) (The Fund) filed a motion for summary judgment, contending that the motion for summary judgment, contending that the trial court lacked subject matter jurisdiction because trial court lacked subject matter jurisdiction because the parties had not exhausted the benefit review the parties had not exhausted the benefit review process.process.

The trial court granted the motion and dismissed the The trial court granted the motion and dismissed the action. The employee appealed.action. The employee appealed.

It was concluded that the trial court lacked It was concluded that the trial court lacked jurisdiction over the subject matter, and therefore the jurisdiction over the subject matter, and therefore the judgment was affirmed.judgment was affirmed.

Exhaustion of Benefit Review ProcessExhaustion of Benefit Review Process

Accepting Retirement While Accepting Retirement While Treating For Injury - Caps onTreating For Injury - Caps on

STEVE IACONO V. SATURN STEVE IACONO V. SATURN CORPORATIONCORPORATION, 2009 WL 648962, 2009 WL 648962

Employee retired before his treatment ended.Employee retired before his treatment ended.

Trial court applied the 1.5 cap against the Trial court applied the 1.5 cap against the Permanent Partial Disability (PPD) claim.Permanent Partial Disability (PPD) claim.

Panel Affirmed.Panel Affirmed.

Accepting Retirement While Accepting Retirement While Treating For Injury - Caps offTreating For Injury - Caps off

TAMMIE HAAKE V. SATURN TAMMIE HAAKE V. SATURN CORPORATIONCORPORATION, 2009 WL 3925399, 2009 WL 3925399

Trial Court declined to apply the 1.5 Trial Court declined to apply the 1.5 cap against the PPD claim, finding cap against the PPD claim, finding retirement based in part on anticipated retirement based in part on anticipated disability.disability.

Panel Affirmed.Panel Affirmed.

Hearing Loss CasesHearing Loss CasesHearing loss cases spawned a number of litigated cases Hearing loss cases spawned a number of litigated cases and appeals. There were approximately 8 Panel decisions and appeals. There were approximately 8 Panel decisions issued since January 2009. Issues addressed in the cases:issued since January 2009. Issues addressed in the cases:

1. Discovery that the hearing loss may be attributable to the work environment may come after retirement and begin the running of the statute of limitations (SOL).

2. Hearing loss from exposure to noise is not progressive.

3. Unless there is continued exposure to harmful noise levels, the impairment level will stop when effective hearing conservation measures are observed.

4. Medical evidence must support that the hearing loss is work-related.

5. Hearing loss to both ears is a scheduled member loss not subject to the 1.5 cap.

6. Hearing loss combined with tinnitus is not scheduled and is subject to the 1.5 cap.

Hearing Loss Cases

Bain v. TRW, Inc.Bain v. TRW, Inc., Slip Copy 2010 WL 1508519, , Slip Copy 2010 WL 1508519, Tenn.Workers Comp. Panel, April 15, 2010 (No. M2008-Tenn.Workers Comp. Panel, April 15, 2010 (No. M2008-02311-WC-R3-WC).02311-WC-R3-WC).

McKamey v. Lockheed Martin Energy Systems, McKamey v. Lockheed Martin Energy Systems, Inc.Inc., Slip Copy, 2010 WL 845210, Tenn. Workers Comp. , Slip Copy, 2010 WL 845210, Tenn. Workers Comp. Panel, March 12, 2010 (No. E2009-00715-SC-WMC-WC). Panel, March 12, 2010 (No. E2009-00715-SC-WMC-WC).

Resh v. Building Materials Corp.Resh v. Building Materials Corp., Slip Copy, 2010 WL , Slip Copy, 2010 WL 844784, Tenn. Workers Comp. Panel, March 11, 2010 (No. 844784, Tenn. Workers Comp. Panel, March 11, 2010 (No. M2009-00028-WC-R3-WC).M2009-00028-WC-R3-WC).

Hall v. TRW Hall v. TRW Automotive, U.S., LLC.Automotive, U.S., LLC., Slip Copy, 2010 , Slip Copy, 2010 WL 366680, Tenn.Workers Comp.PanelWL 366680, Tenn.Workers Comp.Panel, February 3, 2010 , February 3, 2010 (No. M2008-02312-WC-R3-WC).(No. M2008-02312-WC-R3-WC).

Hearing Loss Cases

Jacks v. East Tennessee Mechanical Contractors, Jacks v. East Tennessee Mechanical Contractors, Inc.Inc., Slip Copy, 2009 WL 2589093, Tenn.Workers , Slip Copy, 2009 WL 2589093, Tenn.Workers Comp.Panel, August 24, 2009 (No. E2008-02501-WC-R3-Comp.Panel, August 24, 2009 (No. E2008-02501-WC-R3-WC).WC).

Douglas v. Goodyear Tire & Rubber Co.Douglas v. Goodyear Tire & Rubber Co., Slip Copy , Slip Copy 2009 WL 2567777, Tenn.Workers Comp.Panel, August 19, 2009 WL 2567777, Tenn.Workers Comp.Panel, August 19, 2009 (No. W2008-00533-SC-WCM-WC).2009 (No. W2008-00533-SC-WCM-WC).

Crowell v. TRW, Inc.Crowell v. TRW, Inc., Not Reported in S.W.3d 2009 WL , Not Reported in S.W.3d 2009 WL 1260319, Tenn.Workers Comp.Panel, May 8, 2009 (No. 1260319, Tenn.Workers Comp.Panel, May 8, 2009 (No. M2007-02758-WC-R3-WC).M2007-02758-WC-R3-WC).

Ruffner v. Union Carbide Corp.Ruffner v. Union Carbide Corp., Slip Copy, 2009 WL , Slip Copy, 2009 WL 692322, Tenn.Workers Comp.Panel, March 17, 2009 (No. 692322, Tenn.Workers Comp.Panel, March 17, 2009 (No. E2008-01873-WC-R3-WC).E2008-01873-WC-R3-WC).

Hearing Loss Cases

PTD Employee OverdosePTD Employee OverdoseLeads to Death ClaimLeads to Death Claim

LISA SHELTON V. CENTRAL MUTUAL LISA SHELTON V. CENTRAL MUTUAL INSURANCE COMPANYINSURANCE COMPANY, 2009 WL 1110476, 2009 WL 1110476

Employee was found to have PTD as a result of a Employee was found to have PTD as a result of a work-related injury. work-related injury.

In January 2006, he died as a result of an overdose of In January 2006, he died as a result of an overdose of prescription medication. prescription medication.

His widow sought workers’ compensation death His widow sought workers’ compensation death benefits, alleging that his death was the direct result of benefits, alleging that his death was the direct result of his prior work injury. his prior work injury.

PTD Employee Overdose;PTD Employee Overdose;Leads to Death ClaimLeads to Death Claim

LISA SHELTON V. CENTRAL MUTUAL INSURANCE COMPANY, 2009 WL 1110476

Employer filed a motion for summary judgment contending that the medical evidence was insufficient.

The trial court granted the motion. Employee’s widow appealed.

Judgment reversed and remanded for further proceedings by Panel.

Declined Surgery Leads to Presumptive MMIDeclined Surgery Leads to Presumptive MMI

THOMAS MICHAEL ROSS V. DELTA INDUSTRIAL THOMAS MICHAEL ROSS V. DELTA INDUSTRIAL COATINGS, INC., ET AL.COATINGS, INC., ET AL., 2009 WL 2461853, 2009 WL 2461853

Employee’s ATP recommended surgery, but employee Employee’s ATP recommended surgery, but employee refused surgical treatment.refused surgical treatment.

The trial court found the date of maximum medical The trial court found the date of maximum medical improvement (MMI) was January 26, 2007, and the improvement (MMI) was January 26, 2007, and the employee was entitled to temporary total disability (TTD) employee was entitled to temporary total disability (TTD) until that date.until that date.

Employer appealed.Employer appealed.

WC Panel reversed trial court’s finding as to date of MMI WC Panel reversed trial court’s finding as to date of MMI & used earlier date when employee declined surgery.& used earlier date when employee declined surgery.

SIF Not Liable Where SIF Not Liable Where Employer Was UninsuredEmployer Was Uninsured

JAMES R. SEIBER V. REEVES LOGGING, ET AL., 284 S.W.3d 294 (TENN 2009).

Worker filed suit against employer and Director of SIF seeking benefits.

Circuit Court awarded $286,616.00 in workers’ compensation benefits.

Circuit Court apportioned 15% of liability to employer and 85% to the Fund.

SIF Not Liable Where SIF Not Liable Where Employer Was UninsuredEmployer Was Uninsured

JAMES R. SEIBER V. REEVES LOGGING, ET AL., 284 S.W.3d 294 (TENN 2009).

Supreme Court held that employer was not properly insured within meaning of precondition that had to exist before the Fund could be held liable for workers’ compensation benefits.

Employer permitted workers’ compensation coverage to lapse when employee was injured was not “properly insured” within meaning of precondition that had to exist before the SIF could be held liable. Therefore employee was not entitled to recover benefits from SIF.

C-32 & Unavailable PhysicianC-32 & Unavailable Physician

ANDREW CARTER V. QUALITY OUTDOOR ANDREW CARTER V. QUALITY OUTDOOR PRODUCTS., INC., ET AL.PRODUCTS., INC., ET AL., 303 S.W.3d 265, 303 S.W.3d 265

Employer moved to exclude the medical report Employer moved to exclude the medical report of the physician who performed an IME when it of the physician who performed an IME when it was unable to depose the physician.was unable to depose the physician.

Supreme Court held that employer did not waive Supreme Court held that employer did not waive its right to object to the medical report.its right to object to the medical report.

ANDREW CARTER V. QUALITY OUTDOOR ANDREW CARTER V. QUALITY OUTDOOR PRODUCTS., INC., ET AL.PRODUCTS., INC., ET AL., 303 S.W.3d 265, 303 S.W.3d 265

The physician’s unavailability for a deposition The physician’s unavailability for a deposition precluded the use of medical report; andprecluded the use of medical report; and

The exception to the hearsay rule for unavailable The exception to the hearsay rule for unavailable declarants did not authorize the admission of the medical declarants did not authorize the admission of the medical report.report.

Although the physician was unable to testify at the Although the physician was unable to testify at the hearing because of his physical or mental illness or hearing because of his physical or mental illness or infirmity, the report was not from prior testimony.infirmity, the report was not from prior testimony.

C-32 & Unavailable PhysicianC-32 & Unavailable Physician

Agenda














Mike Shinnick

Workers’ Compensation ManagerTN Department of Commerce &

Insurance

Topic of DiscussionKey Factors Impacting the

Workers’ Compensation Self Insurance Environment

5454

2009 Market Segments2009 Market SegmentsIndividual Self Insureds are on an equivalent basisIndividual Self Insureds are on an equivalent basis

$832

$676

$200$170

$33 $24 $47 $34

$0$100$200$300$400$500$600$700$800$900

Voluntary Self Insurers SI Groups* TWCIP

20082009

Mill

ion

in P

rem

ium

s

* Excluding government sponsored groups

-19%

-28%-27%

-15%

5555

TN Large Deductibles HistoryTN Large Deductibles History

2800

2900

3000

3100

3200

3300

3400

3500

'02 '04 '06 '08p0

50

100

150

200

250

300

'02 '03 '04 '05 '06 '07 '08p

Policy Count Policy Year Premium (millions)

Source: NCCI

5656

Workers’ Compensation Countrywide Workers’ Compensation Countrywide Indemnity Claims Cost IncreasesIndemnity Claims Cost Increases

10.10%9.20%

3.10%4.10%

1.70%

3.10%

5.00% 5.00%5.80%

4.50%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Source: NCCI (2009 is preliminary)

5757

WC Countrywide Medical Claim Cost WC Countrywide Medical Claim Cost TrendsTrends

(Lost Time Cases)(Lost Time Cases)

6.70%

5.00%5.40%

7.30%

13.50%

8.80%

7.30%5.60%

7.40%

5.40%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Med SeverityMed CPI

Sources: NCCI - Med Severity; Economy.com – Medical CPI

* preliminary

5858

Lost Time Countrywide Frequency Lost Time Countrywide Frequency Continues to DeclineContinues to Decline

-4.50%

-6.90%

-4.50%-4.10%

-3.70%

-6.60%-6.20%

-3.00%-3.40%

-4.00%

-7%

-6%

-5%

-4%

-3%

-2%

-1%

0%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009*

Source: NCCI

* Preliminary

5959

Tennessee Direct Premium Written Tennessee Direct Premium Written HistoryHistory

0

100,000,000

200,000,000

300,000,000

400,000,000

500,000,000

600,000,000

700,000,000

800,000,000

900,000,000

1,000,000,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Source: NAIC (Annual Statements)

-19%

6060

Contributions to WC Direct Contributions to WC Direct Premium Written Premium DeclinePremium Written Premium Decline

Calendar Years 2007-2009Calendar Years 2007-2009

2-Year Change in TN Direct Written Premium2-Year Change in TN Direct Written Premium 25%25%

Known Pricing ImpactsKnown Pricing ImpactsChange in TN Loss CostsChange in TN Loss Costs -13% -13%

Change in Carrier PricingChange in Carrier Pricing - 2% - 2%

Economic Impact (US)Economic Impact (US)Change in Total PayrollChange in Total Payroll -5% -5%

Other Impacts -5% Other Impacts -5%

Source: NCCI

6161

Tennessee Voluntary Market Loss Tennessee Voluntary Market Loss Cost Multipliers (LCMs)Cost Multipliers (LCMs)

Market appears at Market appears at this stage to have this stage to have bottomed out. bottomed out. Multipliers are based Multipliers are based on prior year on prior year premium “weighted premium “weighted average” market average” market shares. shares.

1.26

1.35

1.461.49

1.461.43

1.40

1.371.33 1.34

1.1

1.15

1.2

1.25

1.3

1.35

1.4

1.45

1.5

2001200220032004200520062007200820092010

6262

Impact of 2004 Reforms on WC Impact of 2004 Reforms on WC Premiums:Premiums: Estimated $562M Savings Since Estimated $562M Savings Since

2004 (50-6-134)2004 (50-6-134)

CalendaCalendar Yrr Yr

Direct Direct Premium Premium WrittenWritten

Net Estimated Net Estimated Savings*Savings*

Annual % Annual % SavingsSavings

20042004 $883M$883M $20M$20M 2.2%2.2%

20052005 $943M$943M $98M$98M 9.4%9.4%

20062006 $947M$947M $139M$139M 12.8%12.8%

20072007 $947M$947M $114M$114M 10.8%10.8%

20082008 $879M$879M $105M$105M 10.7%10.7%

20092009 $710M$710M $85M$85M 10.7%10.7%

* These preliminary estimates are based on the impact of loss costs and the most recent NCCI study of the estimated decreases in system costs seen in data periods impacting 2007 through

2009 premiums.

6363

WC Premium Tax RevenuesWC Premium Tax Revenues

YE 8/31/06YE 8/31/06 YE 8/31/07YE 8/31/07 YE 8/31/08YE 8/31/08 YE 8/31/09YE 8/31/09

Self Insurance

$11,780,936 $10,164,858

$9,662,965 $8,013,028

InsuranceInsurance $31,458,936$31,458,936 $32,789,58$32,789,5811

$35,317,75$35,317,7588

$31,791,24$31,791,2466

TotalTotal

Premium Premium Tax*Tax*

$43,239,872$43,239,872 $42,954,43$42,954,4399

$44,980,72$44,980,7233

$39,804,27$39,804,2744

Data excludes .4% TOSHA Surcharge

6464

TN Assigned Risk Market Share - NAIC TN Assigned Risk Market Share - NAIC Direct Premium WrittenDirect Premium Written

4.8

0

5

10

15

20

25

30

35

1996

1998

2000

2002

2004

2006

2008

Trigger

6565

TN Assigned Risk Premium TN Assigned Risk Premium Bookings Down 10% in 2010Bookings Down 10% in 2010

00.5

11.52

2.53

3.54

4.55

Jan Feb Mar April May June July

20092010

Mil

lio

ns

6666

Overview of Self-Insurance Market Overview of Self-Insurance Market (2009)(2009)

Self-Insured Employers Self-Insured Employers – 101– 101Number of employees – 244,673Number of employees – 244,673Total “Premium Equivalent” – $170 million Total “Premium Equivalent” – $170 million

Self-Insured Groups Self-Insured Groups – 6 – 6 Number of employees – 34,144Number of employees – 34,144Total Premium – $24 millionTotal Premium – $24 million

6767

Overview of the Tennessee Overview of the Tennessee Workers’ Compensation Market Workers’ Compensation Market

Conditions and EnvironmentConditions and Environment

Copies of Presentation: tn.gov/commerce/insurance

Agenda














Sue Ann HeadAdministrator of the Workers’ Compensation Division

Pete HalverstadtAttorney

Congratulations Congratulations Sue Ann!!Sue Ann!!

SUE ANN WELCH

“Men are like buses, there’s always another one coming along.”

7575

Programs Within the Tennessee Programs Within the Tennessee Workers’ Compensation DivisionWorkers’ Compensation Division

The Workers Compensation Division manages ten The Workers Compensation Division manages ten different programs concerning employees’ and different programs concerning employees’ and employers’ rights and responsibilities. They are:employers’ rights and responsibilities. They are:

– Claims and Coverage—Dark Ages (1919)Claims and Coverage—Dark Ages (1919)– The Second Injury Fund—1946The Second Injury Fund—1946– Benefit Review—1992Benefit Review—1992– Case Management/Utilization Review—1992Case Management/Utilization Review—1992– The Drug Free Workplace Program—1996 The Drug Free Workplace Program—1996 – The Uninsured Employers Fund (UEF)—2001The Uninsured Employers Fund (UEF)—2001– The Penalty Program—2004The Penalty Program—2004– The Medical Fee Schedule—2005The Medical Fee Schedule—2005– The Medical Impairment Rating (MIR) Registry—2005 The Medical Impairment Rating (MIR) Registry—2005 – The Administrative Review Program—2006 The Administrative Review Program—2006

7676

Claims StatisticsClaims StatisticsJuly 1, 2009 through June 30, 2010July 1, 2009 through June 30, 2010

Medical OnlyMedical Only1 to 7 days off work with physician statement1 to 7 days off work with physician statement

Lost Time & MedicalLost Time & MedicalIf 8 days or more off work with physician statement If 8 days or more off work with physician statement indemnity benefits are due to the claimantindemnity benefits are due to the claimant

– 42,16542,165 Lost Time Claims Lost Time Claims

– 63,248 63,248 Medical-Only ClaimsMedical-Only Claims

105,413 105,413 Total ClaimsTotal Claims

7777

Coverage StatisticsCoverage Statistics

Proof of coverage is received Proof of coverage is received electronically from NCCI (National electronically from NCCI (National Council on Compensation Insurance)Council on Compensation Insurance)

July 1, 2009 through June 30, 2010July 1, 2009 through June 30, 2010

108,855108,855 Proofs of coverage received Proofs of coverage received

195,196195,196 Notices of cancellation, Notices of cancellation, reinstatement, endorsementsreinstatement, endorsements

7878

Uninsured Employers FundUninsured Employers Fund

In fiscal year 2009-2010, the UEF In fiscal year 2009-2010, the UEF conducted conducted 2,118 investigations2,118 investigations. .

The UEF The UEF penalized 300 employers penalized 300 employers for for non-compliance i.e. failing to have non-compliance i.e. failing to have workers’ compensation insurance workers’ compensation insurance coverage.coverage.

In fiscal 2009-2010, the UEF collected In fiscal 2009-2010, the UEF collected penalties in the amount of penalties in the amount of $1,039,389.20 $1,039,389.20 from non-compliant employers.from non-compliant employers.

7979

Benefit ReviewRegional and Satellite Offices

DyersburgDyersburg ClarksvilleClarksville NashvilleNashvilleChattanoogaChattanooga

JacksonJackson ColumbiaColumbia MurfreesboroMurfreesboro KnoxvilleKnoxville

MemphisMemphis CookevilleCookeville KingsportKingsport

Anderson

Bedford

Benton

Bledsoe

Blount

Bradley

Campbell

Cannon

Carroll

CarterCheatham

Chester

ClaiborneClay

Cocke

Coffee

Crockett

Cumberland

Davidson

Decatur

De Kalb

DicksonDyer

Fayette

Fentress

Franklin

Gibson

Giles

Grainger

Greene

Grundy

Hamblen

Hamilton

Hancock

Hardeman Hardin

Hawkins

Haywood

Henderson

Henry

Hickman

Houston

Humphreys

Jackson

Jefferson

Johnson

Knox

Lake

Lauderdale

Lawrence

Lewis

LincolnFayetteville

Loudon

McMinn

McNairy

Macon

Madison

Marion

Marshall

MauryMeigs

Monroe

Montgomery

Moore

Morgan

ObionOverton

Perry

Pickett

Polk

Putnam

Rhea

Roane

Robertson

Rutherford

Scott

Sequatchie

Sevier

Shelby

Smith

StewartSullivan

Sumner

Tipton

Trousdale

Unicoi

Union

Van BurenWarren

Washington

Wayne

Weakley

WhiteWilliamson

Wilson

8080

The Benefit Review Program StatsThe Benefit Review Program StatsTTD/Med: TTD/Med: Assistance with resolution of temporary Assistance with resolution of temporary disability and medical benefitsdisability and medical benefits

BRC: Benefit Review Conference: BRC: Benefit Review Conference: Mediation of final Mediation of final settlementssettlements

Approvals: Approvals: Approval of settlements reached with or Approval of settlements reached with or without mediationwithout mediation

FY FY FY FY FY FY 04/05 05/06 06/07 07/08 08/08 09/10

TTD/Med 2,733 4,008 4,987 4,948 5,665 4,547 BRC 6,173 6,976 7,311 6,444 7,044 6,716 Approvals 5,872 6,988 7,053 7,065 7,938 6,464 TOTALS 14,778 17,972 19,351 18,457 20,647 17,727

8181

Administrative ReviewAdministrative ReviewJuly 1, 2009 through June 30, 2010July 1, 2009 through June 30, 2010

Total Number of Requests:Total Number of Requests: 769769Untimely Filed:Untimely Filed: 2929Withdrawn:Withdrawn: 5353Orders Issued:Orders Issued: 683683– Of Orders IssuedOf Orders Issued

Affirmed:Affirmed: 506506 74%74%Not Affirmed:Not Affirmed: 177177 26%26%

8282

Penalty ProgramPenalty ProgramJuly 1, 2008 through June 30, 2009July 1, 2008 through June 30, 2009

25% Penalties25% Penalties

Number of Penalty Referrals:Number of Penalty Referrals: 107107

Number of Penalties Assessed:Number of Penalties Assessed: 4949

Total Penalties Assessed:Total Penalties Assessed: $75,477.51$75,477.51

$10,000+ Penalties$10,000+ Penalties

Number of Penalty Referrals:Number of Penalty Referrals: 2727

Number of Penalties Assessed:Number of Penalties Assessed: 1111

Total Penalties Assessed:Total Penalties Assessed: $45,113.12$45,113.12

8383

MIR RegistryMIR RegistryBy the end of Fiscal Year 2009/2010:By the end of Fiscal Year 2009/2010:

• There were There were 140+140+ Tennessee-licensed physicians on Tennessee-licensed physicians on the Registry—the Registry—

Practicing in nearly Practicing in nearly 200200 offices in offices in 40+ 40+ Tennessee Tennessee counties, and in Mississippi and Georgia, toocounties, and in Mississippi and Georgia, too

• There had been There had been over 276 over 276 valid requests for valid requests for evaluations—evaluations—

Of which Of which 2828 cases settled prior to the evaluation cases settled prior to the evaluation

• EveryEvery completed evaluation was conducted in a completed evaluation was conducted in a timely mannertimely manner

8484

2010-2011 Compensation Levels2010-2011 Compensation Levels

Maximum weekly benefits as of Maximum weekly benefits as of July 1:July 1:

– Temporary benefits--Temporary benefits--$841.50$841.50

– Permanent benefits--Permanent benefits--$765.00$765.00

Minimum weekly benefit as of Minimum weekly benefit as of July 1July 1

– Temporary benefits--Temporary benefits--$114.75$114.75

8585

Utilization RulesUtilization Rules

On November 12, 2009, new utilization rules On November 12, 2009, new utilization rules became applicable to all recommend medical became applicable to all recommend medical treatments and procedures.treatments and procedures.

The trigger for UR is no longer a monetary The trigger for UR is no longer a monetary amount—instead it is triggered when the amount—instead it is triggered when the payor disputes the medical necessity of the payor disputes the medical necessity of the recommended treatment or procedure.recommended treatment or procedure.

The UR Rules provide timelines for The UR Rules provide timelines for conducting the UR.conducting the UR.

8686

Utilization Review cont.Utilization Review cont.

The UR agent must be a TN-license., The UR agent must be a TN-license., Board-certified doctor in the same or Board-certified doctor in the same or similar specialty as the recommending similar specialty as the recommending physician.physician.

The only issue under consideration The only issue under consideration during UR is medical necessity.during UR is medical necessity.

The UR agent’s decision must be in The UR agent’s decision must be in writing and distributed to all parties.writing and distributed to all parties.

Expedited appeal only for UR denials.Expedited appeal only for UR denials.

8787

ADJUSTER TRAININGADJUSTER TRAINING

The TDOL has just begun putting The TDOL has just begun putting together concepts & ideas for adjuster together concepts & ideas for adjuster training.training.Establish minimum standards of Establish minimum standards of training, experience, and skill to adjust training, experience, and skill to adjust TN workers compensation claimsTN workers compensation claimsMandatory certification and renewed-Mandatory certification and renewed-certification processes.certification processes.Failure to comply will result in civil Failure to comply will result in civil penalties.penalties.

8888

Contact InformationContact Information

Sue Ann Head, AdministratorSue Ann Head, [email protected]

Pete Halverstadt, Assistant AdministratorPete Halverstadt, Assistant [email protected]

Website:Website: www.state.tn.us/labor-wfd/wcomp

Phone Number : Phone Number : 1-800-332-1-800-332-26672667

Agenda














TNSIA Thanks our 2010SILVER SPONSORS

Agenda














Steve Gill

Political Radio and Television Commentator

Agenda














A Journey Through the Administrative A Journey Through the Administrative Process of the Department of Labor Process of the Department of Labor

& Workforce Development& Workforce Development..

PATRICK RUTHPATRICK RUTH

Workers’ Comp Specialist IV – TN Dept of Labor & Workforce DevelopmentWorkers’ Comp Specialist IV – TN Dept of Labor & Workforce Development

BILL EASTERLYBILL EASTERLY

Attorney at Law - Easterly and Associates - Nashville, TNAttorney at Law - Easterly and Associates - Nashville, TN

KITTY BOYTEKITTY BOYTE

Attorney at Law - Constangy, Brooks & Smith - Nashville, TNAttorney at Law - Constangy, Brooks & Smith - Nashville, TN

JOHN SMITHJOHN SMITH

v.v.

HAUL ‘EM FREIGHTHAUL ‘EM FREIGHT

((an entirely fictitious hypothetical situation)an entirely fictitious hypothetical situation)

TCA 50-6-236TCA 50-6-236

WORKERS’ COMPENSATION WORKERS’ COMPENSATION SPECIALISTSSPECIALISTS

Establishes a program to assist injured or disabled Establishes a program to assist injured or disabled employees, persons claiming death benefits, employees, persons claiming death benefits,

employers, and other persons in protecting their employers, and other persons in protecting their rights and obtaining information under the rights and obtaining information under the

workers’ compensation laws.workers’ compensation laws.

TCA 50-6-238TCA 50-6-238

REQUEST FOR ASSISTANCEREQUEST FOR ASSISTANCE

Any party or their attorney may request the Any party or their attorney may request the assistance of a workers’ compensation specialist assistance of a workers’ compensation specialist

in the determination of whether temporary in the determination of whether temporary disability or medical benefits are appropriate . . .disability or medical benefits are appropriate . . .

TCA 50-6-238(d)(1)(A)and (B)TCA 50-6-238(d)(1)(A)and (B)

If a specialist issues an order that either denies If a specialist issues an order that either denies benefits to the employee or issues an order for benefits to the employee or issues an order for payment of workers’ compensation benefits, the payment of workers’ compensation benefits, the party against whom the order was issued may party against whom the order was issued may request the administrator of the division of workers’ request the administrator of the division of workers’ compensation to administratively review the compensation to administratively review the specialist’s order . . . . specialist’s order . . . .

A benefit review conference is a non-adversarial, A benefit review conference is a non-adversarial, informal dispute resolution proceeding designed to:informal dispute resolution proceeding designed to:

(1) (1) Explain the rights of the respective parties to a Explain the rights of the respective parties to a workers’ compensation claim and the procedures workers’ compensation claim and the procedures necessary to protect those rights;necessary to protect those rights;

(2) Discuss the facts of the claim, review available information in order to evaluate the claim, and delineate the disputed issues;

TCA 50-6-237TCA 50-6-237BENEFIT REVIEW CONFERENCEBENEFIT REVIEW CONFERENCE


(3) Mediate and resolve disputed issues by mutual agreement of the parties;

(4) Provide an opportunity for, but not to compel, a binding settlement of some or all the issues present at the time;



(5) (5) Facilitate the resolution of issues without the Facilitate the resolution of issues without the expense of litigation or attorneys’ fees for either party; andexpense of litigation or attorneys’ fees for either party; and

(6) (6) Determine, under any proposed settlement, Determine, under any proposed settlement, whether any employee is receiving, substantially, the whether any employee is receiving, substantially, the benefits to which (s)he is entitled under the workers’ benefits to which (s)he is entitled under the workers’ compensation act.compensation act.


Agenda














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