1
WORKERS’ COMPENSATION REFORM
UNDER O.S. TITLE 85A…
WHAT WAS BROKEN, AND HOW
WAS IT FIXED?
Richard M. Fisher, President, Client Relations
Consolidated Benefits Resources
2
“The Grand Bargain”
Source: National Council on Compensation Insurance,
2013, based on 2013 loss costs.
3
“Why Change?”
Average Voluntary Loss Costs Per NCCI
2.5
2.13
2
1.41
Pure Loss 1.5
Cost
1
0.93
0.75
0.65
0.5
0
Oklahoma Arkansas
Texas
State
Region
Country
Source: NCCI
4
Past Workers’ Comp Reforms Kept
Inflation At Bay, But…
• 8810 Loss Cost, per $100 of payroll, 2002 $0.35
• 8810 Loss Cost, per $100 of payroll, 2012 $0.36
Source: NCCI
5
Loss Cost Comparison Between
Surrounding States
$0.40
$0.36
$0.35
$0.30
$0.25
Loss Cost per
$100 of
$0.20
Payroll,
1/1/2013
$0.15
Oklahoma
Texas
Arkansas
$0.11
$0.11
$0.10
$0.05
$Code 8810, "Clerical"
Source: Oklahoma Workers' Compensation Court
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“What Caused Oklahoma’s Workers’
Compensation Costs To Be So High?
Form 3 (lawsuits) Filings
30,000
25,000
24,748
18,447
20,000
14,726
15,000
Form 3 Filings
10,000
5,000
0
1992
2002
2012
Source: Oklahoma Workers' Compensatin Court
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Did The Problem Lie With The Court
System Itself?
$40,000
$34,579
$35,000
$30,000
$25,000
$20,000
$15,000
$14,112
$10,000
$5,000
$0
Avg PPD Award-OWCC
2002
2012
Source: NCCI, based on 2008-2009 filings
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What About Other States?
900
845
800
700
600
500
400
300
343
233
200
100
0
PPD Claims, per 100,000 workers
OK
AR
TX
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The New Commission
 For claims after 2/1/2014, cases heard by the
Commission. Pre 2/1/14 claims stay with the
Court. Old Court will now be called Court of
Existing Claims.
 3 Commissioners are appointed to run the
system, who are political appointees, and serve
staggered terms-6, 4 & 2 years.
 Current Commissioners are Business Oriented.
The New Commission, cont.
• The new Commissioners are:
• Troy Wilson
• Denise Engle
• Robert Gilliland
• Court Administrator has been replaced by an
Executive Director-Dr. Rick Farmer
The New Commission, cont.
• The Commission has established rules, procedures and
forms.
• Commissioners hire Administrative Law Judges to hear
disputes. ALJ’s do not serve a term, and can be
replaced by the Commissioners
• ALJ’s are primary hearing officers of the Commission.
Focus on speedy resolution of claims and disputes.
• The 3 Commissioners will hear appeals from the ALJ
orders.
The New Commission, cont.
• The new Administrative Law Judges are:
• Tish Sommer
• Shane Curtain
• Mike Egan
Commission vs Court
• Commission-Hearings are not governed by
technical or statutory rules of evidence
• Commission-Hearing may be audio recorded
• Court-Trials are governed by rules of evidence
• Court-Court Reporter must be present
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Litigation
 No attorney fee if claim not controverted.
 Commission
wants to use an expanded
Counselors department to offer assistance to
help guide claimant through system, and keep
claim from being litigated.
 If settlement offer is made, and turned down for
a hearing, then claimant’s attorney can only
receive 30% of the difference in the amount
awarded vs the amount offered .
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Medical Benefits
• Employer
gets to select Treating Physician, but must
provide treatment within 5 days of notice of injury.
• Only 1 change of physician allowed.
• The employer/insurer provides the list of 3 physicians, and
the employee selects from the list.
• If an injured worker misses two medical appointments, not
caused by extraordinary circumstances, he will no longer
be eligible to receive benefits under the Act. Inability to
get transportation is not a valid excuse
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Indemnity Benefits-TTD
 Max TTD rate has been lowered to $561 from
$801.
 TTD only lasts a max of 2 years, from 3
previously.
 TTD payable after 3 days lost time; was
previously retroactive to Day 1 if off more than
21 days
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Indemnity Benefits-PPD
 Allowable PPD was reduced by over 30%, by
changing the maximum allowed from 500 weeks
to 350 weeks.
 No job loss, no impairment: No PPD award will
be allowed if an employee returns to his previous
employment, at pre-injury or equivalent job (same
pay). PPD will be set aside, and the amount
owed reduced each week, according to a
schedule based on amount of award divided by
70% of AWW, until the amount is zero.
Indemnity Benefits-PPD, cont.
• If employee refuses to return to work, the PPD
will be deferred and reduced each week he
refuses.
• Permanent
Impairment ratings must be in
accordance with the AMA Guides to the
Evaluation of Permanent Impairment, 6th Edition.
We feel these ratings will be much more
conservative, and result in savings.
Changes in filing timeframes
• A claim for compensation must be filed within one
year of date of injury (previously 2)
• A hearing must be requested within 6 months of
the date of claim
• Claim barred if employee receives no medical
treatment or benefits within one year of date of
injury
• Employee must be on job for 180 days before
being allowed to file for a cumulative trauma
injury
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CC-Form 2, Employers Notice of Injury
 Must be filed by employer, within 10 days after
notification of injury (per Statute, but Commission
Rules require 10 days from 4th day of Lost Time).
 Employer can be fined $500 for failure to submit
timely.
 It is imperative for the employer to send in the CC-
Form-2’s to CBR, as they have in the past…after
notification of an on the job injury. This is the only
way for CBR to know about medical only claims,
the majority of all workers’ compensation cases.
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CC-Form 2A
 CC-Form 2A, Employers notice to accept or deny
claim. Will be filed by CBR.
 TTD must be commenced or denied within 15 days of
employer notice of injury, and a 2A must be filed,
indicating payment or reason for denial.
 There is a potential fine for not filing form.
 15 days not enough time to get medical reports,
investigate claim, in a lot of cases. Extensions for
more time may be filed by CBR for additional time.
The New Law Will Help, but
Keep Doing What You are Doing
• Safety
• Communication
• Employee Screening
• Investigation
• Light Duty
• Compassion
• Diligence
Jerry Whorton, CEO/President
Consolidated Benefits Resources (CBR)
Email: jwhorton@cbremail.com
Phone: 405-210-6002
Richard Fisher, President, Client Relations
Consolidated Benefits Resources (CBR)
Email: rfisher@cbremail.com
Phone: 405-715-5033
Workers’ Compensation Commission:
www.ok.gov/wcc
Oklahoma Insurance Department:
www.ok.gov/oid