TNSIA News

Dear NCSI Member:

The National Council of Self-Insurers has contributed $15,000 toward an amicus brief, being coordinated by the American Insurance Association, in the case of Jackson et al v Sedgwick Claims Management Services, Inc. et al. The Council?s purpose is to preserve the exclusive remedy of workers? compensation.

In Jackson, the plaintiffs allege the same type of RICO claims against Coca Cola and its, TPA, Sedgwick, as six employees of Cassens Transport alleged against Cassens and its TPA.

In October 2008, the U.S. Court of Appeals (Sixth Circuit) ruled that the six employees, who work in Michigan, could proceed with their Racketeer Influenced and Corrupt Organizations Act (RICO) suit, alleging that Cassens, its TPA for workers? compensation; and a doctor, engaged in an illegal scheme to deny the employees benefits for workplace injuries. Cassens subsequently filed a Certeori Petition with the U.S. Supreme Court, requesting a review of the Court of Appeals? decision.

The National Council, with the Michigan and Illinois Self-Insurers Associations, filed an Amicus brief with the Supreme Court in support of Cassens. The brief stated that if the appellate decision holds, employees, who say they are injured at work, will be able to prosecute RICO actions in state and federal courts as well as actions in workers? compensation courts.

In December 2009, the Supreme Court denied Cassens? Certeori Petition.

In Jackson v Sedgwick, Judge Edmunds of the U.S. Court of Appeals (Sixth Circuit), in March 2010, granted the motions of Coca Cola and Sedgwick to dismiss. She said that the exclusive remedy provision in Michigan?s workers? compensation law barred RICO and other remedies.

Jackson et al, however, are appealing Judge Edmund?s decision, arguing it is inconsistent with Cassens. If upheld, Judge Edmund?s decision will have the effect of nullifying the Sixth Circuit?s decision on Cassens. For this reason, the National Council has joined the amicus in a significant way.

Larry Holt
Executive Director

Job Summary: The Safety Manager reports directly to the Director of Health & Safety and is responsible for assisting in the development, implement, and management of safety programs as well as work closely with Facility General Managers in addressing any safety concerns or needs.

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Contact: Steve Heckle – steve.heckle@lkqcorp.com

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Gary Eastes, the risk and benefits manager for the City of Knoxville, Tenn., has been selected as a member of the inaugural Benefit Management Honor Roll, sponsored by Business Insurance, a news publication serving professionals nationwide who administer employee benefits, risk management and insurance programs.

“Gary Eastes has achieved significant milestones for the City of Knoxville through his innovative health and wellness programs,” said Regis Coccia, the Chicago-based editor of Business Insurance. “We are proud to honor him and his colleagues for doing what great benefit managers do: improving the lives of plan members and helping his employer to achieve its goals.”

Business Insurance has sponsored the Benefit Manager of the Year competition annually since 2005. Business Insurance created the program to recognize excellence and innovation in employee benefits management. In 2010, the publication launched the Benefit Management Honor Roll, to recognize outstanding employee benefit managers in organizational categories not represented by the Benefit Manager of the Year.

“Mr. Eastes is a shining example of a benefit professional whose leadership sets him apart from his peers. His efforts not only have helped the City of Knoxville to gain control over health care costs, but he and his team are making a difference in the lives of the city’s employees and their dependents,” Mr. Coccia said.

Any full-time employee of a corporation, nonprofit organization or government entity who oversees or manages employee benefit functions is eligible for the awards. Benefit managers anywhere in the world are eligible for consideration. The value or generosity of specific benefits is not judged; the award is intended to honor excellence in managing and administering benefit programs overall.

An independent panel of judges, representing prior honorees and benefits industry executives, selects the Benefit Manager of the Year and Benefit Management Honor Roll members from nominations submitted to Business Insurance.

The Tennessee Self Insurers’ Association is pleased to welcome as a new Associate Member, Harmony Hearing Services. Harmony Hearing Services is a nationwide provider of hearing aids and related services for the workers’ compensation industry. Harmony works with employers and adjusters to reduce their costs for hearing loss claims. They do this with purchasing power, a well managed network of over 1,500 providers, and customized hearing loss prevention programs.

View Adjuster Certification Rules

The purpose of this memorandum is to inform you that actuarial opinion reports are now required annually instead of biennially pursuant to a revision to Tenn. Code Annotated 50-6-405(b)(2). Please see the attached revision act.

State of Tennessee – AO Annually Requirement

In an attempt to make it easier for entities to report workers’ compensation settlements that contemplate future medical (including prescription drug) treatments, the Centers for Medicare & Medicaid Services (CMS) proposes, by calendar year 2010, to streamline the WCMSA proposal submission process for the various affected stakeholders by making available an Internet web-based portal or interface. The benefits of an Internet web-based portal or interface for submitters and other affected workers’ compensation stakeholders include, but are not limited to, the following:

• Allows for quicker creation of new WCMSA cases for processing.
• Facilitates tracking of the status of submitted WCMSA cases.
• Provides for almost instantaneous feedback to the submitter.
• Reduces the need for mailings.

Before launching development efforts in this direction, however, CMS wishes to gauge the workers’ compensation industry’s readiness for this submission methodology. Please review and complete the “Survey of Workers’ Compensation Medicare Set-Aside (WCMSA) Process,”  Your completed response should be emailed (with “Survey” in the Subject line) to the MSP Central mailbox at: mspcentral@cms.hhs.gov no later than July 31, 2009.

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Congratulations are in order!  We have successfully escorted two bills through the legislative system which we were deeply involved in promoting.  The bills are as follows:

1)  SB1574.  This bill puts to rest the Overstreet decision, a 2008 Supreme Court case preventing employers, insurance carriers and attorneys from communicating with the authorized treating physician.  SB 1574 allows us to communicate with the authorized treating physician under the following terms:

• The employer may send written communications to the treating physician, but must copy the employee or the employee’s attorney on the correspondence with any attached materials and must provide the employee or the employee’s attorney with copies of the physician’s response to the correspondence within seven (7) days of receipt.

• The employer may communicate orally with the treating physician, but must send the employee or the employee’s attorney a written summary of the opinions or statements of the physician within seven (7) days of a request by the employee or the employee’s attorney.

• The employer’s attorney may communicate orally with the authorized treating physician, but must provide written notice to the employee or the employee’s attorney at least seven (7) days prior to the communication and must provide the employee or the employee’s attorney with a written summary of all opinions expressed by the physician within seven (7) days of the communication.

It was our position that there should not be any restrictions on our ability to communicate with the authorized physician, but it was also our feeling that this law will help us much more than it will hurt us and we felt very strongly that it should be passed.  This bill passed both legislative chambers and will soon be transmitted to the Governor for his signature.

2)   SB1909.  This bill also deals with a recent Supreme Court decision.  That decision greatly expanded the scope of employment to include workers who were voluntarily engaged in recreational activity.  Our bill puts some very specific restrictions on the ability to successfully make a workers’ compensation claim for a person who is injured during a recreational activity.

The bill disallows employees from recovering for injuries sustained during recreational activities, except in the following limited circumstances:

• When the employee’s participation was expressly or impliedly required by the employer; or

◦ When the employee’s participation produced a direct benefit to the employer beyond improvement in employee health and morale; or

▪ When the employee’s participation was during the employee’s work hours and was part of the employee’s work-related duties; or

• When the injury occurred due to an unsafe condition during voluntary participation using facilities designated by, furnished by or maintained by the employer on or off the employer’s premises and the employer had actual knowledge of the unsafe condition and failed to curtail the activity or program or cure the unsafe condition.

  On June 1, 2009, SB1909 was transmitted to the Governor for his signature.

  Additionally, two other business bills are close to becoming law.  SB 1567 states that if an employer gets bought out by another company and retains the employee at the same or greater pay, the employee is not entitled to reopen his case under T.C.A. §50-6-241(a).

  Prior case law counter-intuitively dictated that when a company simply changed its name, the employee could reopen his case and still keep his job. On May 27, 2009, this bill was transmitted to the Governor for his signature.

  Second, SB 2162 makes clear that an employee who is an illegal alien may not recover more than 1.5 times his impairment rating.  The argument here is that the employee should not be able to go up to the 6 times cap if the employer is required to fire the employee because of the Federal law that prohibits the employer from retaining illegal workers.

  However, the bill also holds that if the employer is aware that the employee is illegal, there will be an automatic award of 5 times the rating.  The employee will not get those funds, which will go to the State Second Injury Fund.  This bill has passed the Senate and will soon be voted on in the House.

Congratulations are in order to our esteemed Legislature which has made these significant changes to State law in spite of party differences.

Terry L. Hill, Executive Director

MANDATORY INSURANCE REPORTING: The Medicare, Medicaid, and SCHIP Extension Act of 2007 has created mandatory reporting requirements for Liability Insurance (including Self-Insurance), No Fault Insurance, and Workers Compensation. For additional information, please refer to the following website from the Centers for Medicare and Medicaid Services (CMS). In addition, the MSIA encourages its members to subscribe for updates from CMS. On the page titled Overview, go to the heading “Related Links Inside CMS” and click on the link “For e-mail updates and notifications.”

http://www.cms.hhs.gov/MandatoryInsRep/

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