Illinois is the 19th-most-expensive
state in the nation when it comes to workers' compensation premiums,
and Illinois companies pay 40 percent more for workers' compensation
than neighboring states Michigan, Wisconsin and Indiana. According
to the National Insurance Crime Bureau, workers' compensation fraud
costs employers $6.5 billion a year. This agreement addresses all of
these issues and more.
economy continues to grow and create more jobs throughout Illinois,
business, labor and government leaders all understood that we had to
fix our workers' compensation system in order to make this state a
much better place to do business in," Gov. Blagojevich said.
"Businesses are being hit with spiraling costs, and hardworking men
and women are paying the consequences by not getting the benefits
they deserve. By working closely together, we have crafted this
agreement that helps set a medical fee schedule to contain costs,
increases important workers' benefits, cracks down on fraud and cuts
the time it takes to resolve claims. Everybody wanted to do what is
best for Illinois, and these fundamental changes in the workers'
compensation system work for everybody."
the highlights of the agreement include:
Implementing a medical fee schedule -- Creates cost-containment in
workers' compensation by joining 42 other states in creating a
medical fee schedule. This medical fee schedule will be indexed to
the consumer price index and will save Illinois businesses
millions of dollars annually.
benefits to increase substantially -- Increases the minimum
benefit for a worker killed on the job to the greater of $500,000
or 25 years of payments (was approximately $400,000 for 20 years
of payments). Increases the burial benefits to $8,000 from $4,200
for fatally injured workers.
Establishes a fraud unit -- Creates a workers' compensation fraud
statute and investigation unit within the Division of Insurance of
the Illinois Department of Financial and Professional Regulation
to investigate charges of workers' compensation fraud, including
uninsured employers, and allows for reporting of fraudulent claims
- Creates a third panel to the
Workers' Compensation Commission -- This will expedite resolution
of disputed claims and also expand and expedite emergency hearings
to resolve cases within 180 days, which will allow injured workers
to receive quicker treatment and return to work earlier. This will
result in claims being heard and resolved faster, which will
decrease litigation costs.
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"These reforms to Illinois' workers'
compensation system provide fair and balanced benefits to both
business and labor," said Gregory Baise, Illinois Manufacturers'
Association president and chief executive officer. "Illinois
manufacturers and other businesses will be able to realize
significant cost-savings through nationally accepted managed care
practices, and everyone will benefit from the pragmatic antifraud
measures included in these reforms."
"It has been 30 years since the
Workers' Compensation Act has been reformed," said Michael Carrigan,
Illinois AFL-CIO secretary-treasurer. The ‘agreed bill' process has
worked! The negotiations that have taken place have resulted in an
updated workers' compensation system, improved benefits for injured
workers and cost-savings for business."
"This is the culmination of many
months of hard work and negotiations by all the parties involved,"
said state Sen. Terry Link, D-Lake Bluff. "The agreement will
benefit labor, business and health care providers. I am very pleased
that Senate President Jones gave me the opportunity to work on this
"I want to commend Gov. Blagojevich
for convening this process," said state Sen. Dan Cronin, R-Lombard.
"This is a victory for both business and labor. By fundamentally
reforming our workers' compensation system, we are able to reduce
business costs, provide more generous benefits and fight the fraud
that is costing our country billions of dollars,"
"Gov. Blagojevich made it a priority
to reform our workers' compensation system, in his State of the
State address, and we all are so pleased that this reform has
happened today," said state Rep. Jay Hoffman, D-Collinsville. "This
is a great example of business and labor coming together and doing
what is right for all of Illinois."
"After much work, legislation for
reform of workers' compensation is being drafted," said state Rep.
Dan Brady, R-Bloomington.
"Having been involved with the
Illinois Workers' Compensation system for 17 years, this is clearly
the most comprehensive workers' compensation reform in a
generation," said Dennis Ruth, chairman of the Illinois Workers'
Compensation Commission. "It addresses multiple issues, including
fraud investigation, cost-containment for employers, speeding up the
hearing process for both workers and employers, and improved
benefits for widows and orphans. This is a win-win for both
employers and employees of the state."
[News release from the governor's