Analysis of Senate Bill 45 (as Introduced)

Analysis of Senate Bill 45 (as Introduced)

Posted: February, 1997

This is an analysis of changes which would be made in the Ohio workers’ compensation system by Senate Bill No. 45, the Benefit Reduction Bill, which was introduced in the Ohio Senate on February 13, 1997.

This analysis deals only with those portions of the Bill set out in Chapters 4121 and 4123, dealing with workers’ compensation. Senate Bill 45 has a section dealing with medical provider fraud and employer fraud, as well as sections dealing with unemployment compensation and workers’ compensation.

For more information about this bill, see our referendum page. Highlights follow:

Chapter 4121 Changes

  • Requires use of AMA Guides: Requires Bureau of Workers’ Compensation and Industrial Commission to adopt a policy for evaluation of permanent partial impairment using the AMA Guides to evaluation in its most current edition.
  • District Hearing Officers to Report Fraud: R.C. 4121.34 District Hearing Officers (DHO) to report suspected fraudulent activity. DHO held harmless from reporting and inspection division of BWC to keep in confidence the identity of the DHO.
  • Staff Hearing Officers to Report Fraud: R.C. 4121.35 Same provisions for SHO on reporting fraud as for DHO.
  • Requires use of AMA Guides: R.C. 4123.38 Commission to issue policy requiring use of the most recent edition of the American Medical Association Guides to Evaluation of Permanent Partial Impairment.
  • Non-Attorney Representation: R.C. 4121.36 Provides law not to be construed to bar non-attorney from representing a party.
  • Medical Provider Fraud: R.C. 4121.444 Prohibits health care providers and MCOs from obtaining payment to which not entitled. Establishes penalties paid to the state fund or the self-insurer. Six year statute of limitations.
  • Safety Violations, Agricultural Buildings: R.C. 4121.47 Rules on workshops and factories do not apply to buildings or structures used for agricultural purposes and located on land zoned agricultural or to any fixtures, machinery, equipment, tools in those buildings.
  • Rehabilitation: R.C. 4121.65 Adds employers under R.C. 4123.46 may be granted authority to furnish rehabilitation services.
  • Rehabilitation Wage Loss, Reduction: R.C. 4121.67(B) Reduces weeks of rehabilitation wage loss by weeks of regular wage loss paid under R.C. 4123.56.

Chapter 4123 Changes

  • Religious Exclusion from Coverage: R.C. 4123.01(A)(2)(c) Excludes from definition of employee members of religious sects conscientiously opposed to insurance providing employee signs waiver and affidavit and administrator grants waiver to the individual’s employer.
  • Exclusion from Injury Definition: R.C. 4123.01(C)(4) Excludes from injury definition pre-existing conditions unless substantially worsened that condition or substantially accelerated the disease as documented by objective clinical findings and test results. Subjective complaints insufficient.
  • Exclusion from Injury Definition: R.C. 4123.01(C)(5) Excludes from injury definition cumulative or repetitive trauma.
  • New Occupational Disease Definition: R.C. 4123.01(F) Deletes present definition. Puts cumulative, repetitive trauma under occupational diseaase and defines occupational disease as damage or harm to the physical structure of the body, due to “causes and conditions characteristic or peculiar to a particular industrial process, trade, or occupation”:Excludes:
    1. ordinary disease of life absent a showing the disease is characteristic of and peculiar to a particular industrial process, trade or occupation.
    2. a disease that would arise without occupational exposure.
    3. a disease resulting from aggravation of a pre-existing disease.
    4. a disease caused primarily by natural deterioration;
    5. psychiatric conditions except where arise from an injury or occupational disease.
  • Attorney Records: R.C. 4123.061 Attorney records are property of the client to be turned over the client upon request within fifteen days at no more than twenty-five cents per page charge.
  • Religious Exemption: R.C. 4123.15 Employer who is member of recognized religious sect which opposed insurance may ask Administrator, BWC for exemption. Administrator to exclude if sect makes provisions for dependent members. Protects such “employers” from suit by the blanket exemption from suit for all employers who provide workers’ compensation.
  • Rules for Employer Payroll Misrepresentation: R.C. 4123.25 Administrator to adopt rules to fine or penalize employers who knowingly misrepresent to BWC the amount or classification of payroll.
  • Secret Records: R.C. 4123.27 Employer information provided to BWC and records of injury and disease kept by Division of Safety and Hygiene are not open to the public. Includes as secret accident investigation reports and illness and injury data.
  • Fines Against Employer and Employer Appeal: R.C. 4123.352 Adds authority to Administrator to fine for failure to follow rules or pay, but Administrator need not fine. Administrator to adopt rules with advice and consent of the Oversight Commission. Provides for appeal by self-insurer to Self-Insured Evaluation Board. Appeals stay the order. Board’s decision must be unanimous within thirty days. Removed Self-Insured Board independent authority to fine.
  • DWRF for Permanent Total Impairment: R.C. 4123.412, 4123.413, 4123.414, 4123.416 Changes eligibility from people permanently totally “disabled” to permanently totally “impaired”.
  • Time for Administrator to Act: R.C. 4123.511(A) Administrator within seven days of notice that an occupational disease has been diagnosed shall notify both employer and employee; the notice is considered an application for compensation.
  • Payment of Compensation: R.C. 4123.511(B) Administrator to issue order in statefund claims no later than twenty-eight days after receiving notice of claim granting or denying.R.C. 4123.511(H) Provides employer has to pay compensation within twenty-one days of receipt of DHO Order.
  • Continuing Jurisdiction Reduced to Three Years: R.C. 4123.52 Reduces time claim is open to three years. Unless compensation is paid under R.C. 4123.56 (temporary total or wage loss), or R.C. 4123.58 (permanent total) or R.C. 4123.59 (death) or medical benefits are paid. Compensation can only be paid within three years after last payment of compensation under R.C. 4123.56, R.C. 4123.57(B), R.C. 4123.58, or R.C. 4123.59.On medical payments treatment can be paid for only within three years after date of last treatment which is paid.Awards cannot be made for a back period exceeding two years unless written notice as required by R.C. 4123.84 and R.C. 4123.85 has been given.
  • Defines Medical Benefits: R.C. 4123.52(E) Payment of medical bill to a hospital or a licensed doctor or for prosthetic or orthopedic device, or prescription medication.
  • Mandatory Rehabilitation: R.C. 4123.531 Administrator may require any employee asking compensation to submit to a vocational rehabilitation evaluation. If vocational rehabilitation is recommended, the employee shall comply. Failure to comply suspends claim.
  • Intoxication or Under the Influence of Drugs: R.C. 4123.54 Creates rebuttable presumption that use is proximate cause of injury. Refusal to submit to test is evidence of employee use at any hearing.
  • Limits on Pre-Existing Conditions: Limits payment and medical for aggravation of pre-existing condition to result of the worsening. Once returned to original condition, no further payment.
  • Benefits Reduced where Federal Benefits Received: R.C. 4123.541 Civil defense workers: Reduces proportionally temporary total or permanent total Impairment due to benefits from federal government.
  • Occupational Disease: R.C. 4123.55 Provides no payment for first week after injury or first diagnosis occupational disease.
  • Net Take Home Pay: R.C. 4123.56(A) Defines net take home weekly wage: Divide total remuneration as defined in R.C. 4141.01 (unemployment compensation) paid during first four of last five calendar quarters immediately preceding first date eligible for benefits by number of weeks paid during those quarters less taxes.
  • R.C. 4123.56(B)(1) Permits self-insured to start payment voluntarily and continue such payments at its discretion. On first payment employees to be notified:
    1. payment voluntarily started
    2. the self-insured may terminate payment at any time
    3. the employee has a right to a hearing at any time
    4. if claim determined valid amount already paid is offset

    Self-insurer to either certify or contest claim within seventy-five days after first payment. A claim is deemed contested if employer fails to certify or contest.

    R.C. 4123.56(B)(2) Excepts the (B)(1) claims from requirement for continued payment of compensation on the report of the attending physician.

  • Overpayment and Backdating of Temporary Total Termination: R.C. 4123.56(B)(4) If Hearing Officer terminates temporary total before date of hearing, an overpayment to be declared and collected back from future industrial compensation.
  • Wage Loss Reductions: R.C. 4123.56(C)(1) Provides: Wage loss must be due solely to allowed conditions. Limits amount paid to difference between employee’s average weekly wage and present earnings. Reduces two hundred weeks by any rehabilitation wage loss.R.C. 4123.56(C)(2) Provides for twenty-six weeks non-working wage loss. However, period may be extended up to fifty-two weeks maximum, if Administrator, Bureau of Employment Services, extends benefit period for unemployment compensation under R.C. 4141.301.R.C. 4123.56(C)(3) Aggregates all wage loss payable to a maximum of two hundred weeks.
  • Self-Insured Payment Not Recognition: R.C. 4132.56(F) Provides that payment of temporary total voluntarily made by self-insured under R.C. 4123.511(B) is not recognition of the claim, does toll the statute of limitations for filing a claim.
  • Permanent Partial Impairment: R.C. 4123.57(A)(2) Changes disability to impairment. Eliminates forty week waiting period to file application for award where:
    1. temporary total is terminated at a hearing on basis of maximum medical improvement.
    2. temporary total is terminated because treating doctor certifies maximum medical improvement.

    R.C. 4123.57(A)(3) Prohibits permanent partial or an examination for permanent partial or amputation award where injured worker is getting permanent total or temporary total in the same claim in which permanent partial is sought.

    R.C. 4123.57(A)(4) Upon filing a permanent partial application and a permanent total application and a treating doctor statement of inability to work, the injured worker shall receive a permanent partial award for sixty days equal to two-thirds of the statewide average weekly wage as set out in R.C. 4123.62 until issuance of tentative order or, whichever is earlier. The amount paid is two-thirds of the employee’s average weekly wage not to exceed the statewide average weekly wage and not less than a third of the statewide average weekly wage, unless the employee’s wage is less.

    Impairment to be evaluated by BWC medical examiner using the most recent AMA Guide. Administrator to issue tentative order unless finds medical report clearly erroneous. If erroneous new examination to be scheduled. Employee and employer within fourteen days of receipt of Order to file either acceptance or objection and serve the other party. If nothing filed, order becomes final. Payment to be made in twenty-one days of order becoming final.

    R.C. 4123.57(A)(7) District Hearing Officer to rubber stamp BWC medical examination unless:

    1. report is based, in part, on non-allowed conditions;
    2. medical did not consider all allowed conditions;
    3. medical examiner prejudiced against employee or employer;
    4. temporary total order is barred by law.

    If District Hearing Officer finds item one, two, or three above, s/he rejects report and orders new examination by BWC. If s/he finds number four, issues order barring permanent partial.

  • Application for Permanent Partial Increase: R.C. 4123.57(A)(8) Applications for increase handled in same fashion as though it were original application.
  • Amount of Compensation for Permanent Partial: R.C. 4123.57(A)(9) Compensation paid at two-thirds of the employee’s average weekly wage as defined in R.C. 4123.62 subject to a maximum of two-thirds of the statewide average weekly wage for number of weeks that equals the percentage of permanent partial impairment. The change here means for each percentage point one week is paid instead of the present two weeks. Instead of a maximum of two hundred weeks, the maximum now is one hundred weeks.Changes disability to impairment throughout.
  • Permanent Total Disability changed to Impairment: R.C. 4123.58 Changes permanent total disability to permanent total impairment (PPI). Defines PPI as physical or mental limitations preventing the employee from sustained remunerative employment (SRE). Age may be considered, but PTI may not be awarded if age is a significant factor preventing SRE or “acquiring the capacity to engage in SRE.”
  • Reduce Permanent Total: Permanent total to be paid from last date temporary total paid, but reduced by the permanent partial paid.
  • Death not Abate Settlement: R.C. 4123.60(B) Death of claimant entitled to payment of a settlement does not abate settlement. Payment to estate.
  • Occupational Disease Date of Diagnosis fixes Benefits: R.C. 4123.61 Requires use of date of first diagnosis in occupational disease claim as basis on which benefits computed. Average weekly wage and full weekly wage is computed. Excludes from special circumstances to adjust wage any periods when injured worker is a full- or part-time student in a college or university.Orders by Administrator appealed to Industrial Commission but not to court.
  • Average Weekly Wage, Exclude College Students from Adjustment: R.C. 4123.62 Presently permits adjustment of the average weekly wage where the person is of such age and experience that it would be expected the wage would increase. This amendment prevents an adjustment where the person is a full- or part-time student.
  • Settlement without Employer Signature: R.C. 4123.65(A) Permits injured worker to file settlement application without employer’s signature. If employer still doing business in state, Administrator to send him notice. If employer not respond within sixty days, the agreement does not need the employer’s signature.
  • Settlement, Unrepresented Party: R.C. 4123.65(D) Where one party is unrepresented, the Administrator in state fund claims and the self-insurer send copy of the agreement to the Industrial Commission where a Staff Hearing Officer shall determine if the settlement is clearly unfair, and if so, disapprove the settlement.
  • Represented, defined: R.C. 4123.65(G) Represented means:
    1. attorney admitted in Ohio;
    2. representative of an employee organization recognized by the employer for collective bargaining;
    3. person providing workers’ compensation services to employers;
    4. self-insured employer whose duties include administering the self-insured workers’ compensation program.
  • Medical Examination: R.C. 4123.68 Adds impairment throughout.Administrator before awarding compensation on asbestosis, berylliosis and other diseases to refer claim for medical examination. In no event is compensation to be paid without an examination.
  • Injury Time Limits: R.C. 4123.84 Provides that payment or furnishing benefits or compensation is not recognition of a claim or condition.
  • Occupational Disease Time Limits: R.C. 4123.85 Deletes two years after disability began as a criteria. Also deletes six months after diagnosis. Time runs two years from first diagnosis of occupational disease.
  • Use Retirement Benefits to Reduce Workers’ Compensation: R.C. 4123.86 Reduces temporary total, permanent total, and DWRF by combining such benefits with benefits received under a retirement plan were employer funds at least eighty percent of retirement plan so that total of both does not exceed statewide average weekly wage, leading to reduction of workers’ compensation.
  • Discrimination: R.C. 4123.90 Specifies no discrimination against employee who files a claim or pursues compensation under R.C. 4123, 4126, 4127 or 4131. Noticeable by its absence is 4121 – which contains safety violation, rehabilitation provision.
  • Permanent Total Changes Retroactive: Applies provision changes of R.C. 4123.58 [permanent total] to all applications filed on or after effective date of act regardless of date of injury.

Other Changes

  • Reduce Unemployment Compensation: R.C. 4141.31 Reduces unemployment compensation by amounts received under R.C. 4123.56(C) [wage loss].
Information courtesy of the Ohio Workers’ Compensation Bulletin. Subscribe to the Ohio Workers’ Compensation Bulletin to keep informed about the Ohio workers’ compensation system.