A Summary of Emerging Topics from the Regulators’ Roundtable at the WCI Conference in Orlando

| | Evidence Based Medicine, Physician Peer Review, Utilization Review

WCI 2015 Tom photo -edit

At the 2015 Workers’ Compensation Educational Conference in Orlando, the National Regulators Roundtable met to discuss challenges, concerns and issues facing workers’ compensation jurisdictions. The session, sponsored by the Southern Association of Workers’ Compensation Administrators (SAWCA), brought together regulators from 31 states.

The regulatory roundtables are opportunities to share ideas about problems that may have been successfully addressed by other jurisdictions. Also, an emerging concern in one state may be an indicator for future developments in other states. The theme of the meeting was that legislative issues know no boundaries.

Of the 31 panel members, 21 were workers’ comp judges, while the others were generally directors and managers in each state’s workers’ comp divisions or related organizations. Regulators were positioned in a large circle, and audience members sat in groups on two sides of the circle.

The Honorable Melodie Belcher, an Administrative Law Judge (ALJ) from Georgia, acted as the moderator and facilitator. In addition to serving as an ALJ, Judge Belcher has acted as the former President of SAWCA. She kept the discussions organized and on point.

As expected, the panel discussed “hot topics” such as opioid addiction, medical marijuana, prescription drug compounding, and “opt out” laws similar to those in Texas and Oklahoma. But the panel also addressed topics that may be indicators of future developments. These topics included physician dispensing, air ambulance fees, intentional misclassification of workers, mandatory mediations in litigated cases, the Firefighter Cancer Presumption and the Aggressor Defense. A summary of these “off Broadway” topics follows.


Many of the panel members articulated their concerns about physician dispensing. Members in states other than those that strictly limit or exclude it (Massachusetts, Montana, New York, Ohio, Texas and Washington) cited higher costs when physicians dispense prescription drugs than when pharmacies dispense them. In addition, many panel members were concerned about patient safety, as most physicians do not utilize a state’s Pharmacy Benefit Manager (PBM) system. PBMs have been around for more than a dozen years. They have proven effective in helping to reduce drug costs and in tracking a patient’s drug consumption, which helps prevent drug addiction and abuse.


Commissioner Ryan Brannan stated that air ambulance fees were a significant issue in Texas. Injured workers are sometimes transported by air ambulance when injuries occur far away from a hospital (e.g., workers injured on an oil rig). Other workers may need a higher level of care than a nearby hospital can provide, so they are flown to another hospital. In any event, air ambulance operators charge fees based on what they deem reasonable.

Texas pays 125% of the Medicare rate, based on Texas Labor Code §413 adopted in 2002. The result is an average fee dispute of $28,126 as opposed to what the air ambulance operator demands. There are currently over 500 cases pending. Commissioner Brannan warned that the ambulance operators claim they are not subject to a fee schedule because they believe their services fall under the federal Airline Deregulation Act of 1978. Brannan stated that the Supreme Court of Texas would ultimately have to decide this issue.


Judge Tom Stine shared that in Nebraska they are so concerned about employers misclassifying employees as independent contractors that they are considering a law requiring certification for independent contractors. In order for a worker to be recognized as an independent contractor, he would have to obtain a certificate from the state.

While everyone in the room initially nodded in agreement that certification would cut down on misclassification, Judge Roger Williams from Virginia stated that the certification concept was open for abuse. A worker could get his certificate, act as an employee for all intents and purposes, and the business that hired him could then use the certificate to avoid fines or penalties. Judge Williams stated, “Whether someone is an independent contractor or not should be fact specific.” It will be interesting to see if Nebraska pushes forward with this legislation.


Judge Paul Sighinolfi of Maine discussed his state’s system of mandatory mediation in litigated cases. This is similar to what we currently see in civil state court cases that do not involve workers’ compensation. He stated that before a getting a trial the injured worker and the insurance carrier (or self insured employer) would be required to mediate. He said that a significant number of cases were settling in this manner, freeing up resources at the Workers’ Compensation Board (WCB).

Sighinolfi encouraged other states to make mediation mandatory in litigated cases. He warned, however, that telephone mediations were generally not effective. Only parties that have to meet face-to-face tend to settle their cases. Other panel members, including Judge Ingrid French from New Jersey, agreed with this approach.


Pennsylvania has passed Act 46. This statute allows firefighters to request workers’ comp benefits if they are diagnosed with cancer and can show they had exposure to certain carcinogens or chemicals. Benzene, for example, has been linked to leukemia and lymphoma.

After the law took effect insurance companies saw an explosion in the number of workers’ comp cancer claims. As a result, most workers’ comp carriers stopped writing comp policies for firefighters. This resulted in much higher rates from the only carrier still available for firefighters, the Pennsylvania State Workers’ Insurance Fund (SWIF). Some panel members articulated they now felt they were in a quandary: Either allow firefighters to make cancer claims in workers’ comp and dramatically raise the cost of workers’ comp, or deny the cancer benefit and appear callous or uncaring. In the end there was no clear consensus in most states.


Panelists from New Jersey, Pennsylvania and other states discussed the “Aggressor Defense.” This is a defense to workers’ comp claims in which the injured worker has started a fight. This defense may seem to run counter to the workers’ comp “no fault” premise (i.e., no contributory negligence). A worker who foolishly twirls a nail gun, for example, and shoots himself with a nail is still eligible for benefits. But many panel members agreed that it is fundamentally wrong for a worker to receive indemnity benefits when his injury results from a fight that he started. This is different from “horseplay,” where workers are engaging in an activity not necessarily work-related but also not “a major deviation.”

Most participants agreed the Regulators’ Roundtable was relevant and useful – one of many at WCI 2015. The most powerful feature of regulatory roundtables is the sense of camaraderie participants feel in confronting work comp issues. The bottom line is that we are never really alone in our quest to provide the best possible benefits to injured workers for the least cost.

Tom Swiatek

Tom Swiatek

As Assistant Vice President of Regulatory Services, General Counsel, and Editor in Chief of UR Nation, Tom Swiatek draws on his experience as an insurance attorney on both the general liability side, as well as on workers’ compensation matters. As a California Workers’ Compensation Section Member, Tom is leading the discussion with respect to the regulatory challenges and opportunities facing the workers’ compensation system.