 At first glance, workers’ compensation reform might seem like small potatoes.
That’s because its effects can be tough for people to see: The payroll of a
small trucking business in East Peoria, a routine railroad repair job in
Rochelle, salaries at a Springfield steel shop.
This type of blue-collar work is where employers can experience serious pain on
their workers’ compensation bills. Those costs, the highest in the Midwest, kill
jobs growth and higher salaries. That’s why some state politicians dismiss
workers’ compensation as purely an economic issue. They say it should be off the
table in budget discussions.
But they’re wrong. There are other unseen costs.
What many Illinoisans may not know is that this broken system greatly affects
the ability of Illinois governments to care for the people most in need of
public services. It is indeed a budget issue. And it lays bare the perverse
priorities of our state.
Kim Zoeller is the CEO of the Ray Graham Association, a social service provider
based in DuPage County that cares for 2,000 adults and children with
intellectual and developmental disabilities. Nearly all of the group’s funding
comes from state government.
The mission of the Ray Graham Association is not only to care for those people,
but also to help them achieve more than they ever thought possible: A dream job,
pursuing a passion, or simply the joy of living independently. That takes years
of patience and hard work from nearly 400 employees.
But in 2010, something terrible happened.
While caring for one of the Association’s clients, an employee stumbled and
suffered a sprained ankle. After many visits to different doctors, a later
diagnosis of a generalized pain disorder, and years of litigation, the
Association found itself on the hook for a $650,000 settlement.
All for a sprained ankle.
“It was like someone pushed us off a cliff,” Zoeller said.
That case radically increased the organization’s workers’ compensation premiums.
What once was a cost that hovered around $460,000 annually now comes in at more
than $1 million.
“You think about where that half-a-million-dollar difference could go,” Zoeller
said.
She estimates it would be enough to cover the cost of residential support
services for nine adults for an entire year, or it could be used to raise the
base salary of her care providers.
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 “The provider community is very supportive of workers’ comp
reforms for those reasons,” Zoeller said. “What’s frustrating is
that it’s the same system that’s funding us that isn’t passing these
reforms.”
The sprained ankle is only one example of government funds flowing
not to essential services, but to pay for a system that is clearly
flawed. Zoeller said the Association recently had to pay out $1,500
for a paper cut.
That’s not where taxpayers expect their money to go, especially
when funding care for Illinoisans with lifelong disabilities.
A study released Nov. 29 by the Illinois Policy Institute shows the
cost of workers’ compensation for municipalities, counties and state
government in Illinois is more than $400 million per year.
If that’s not a budget issue, what is?
That estimate doesn’t even consider the other units of local
government in Illinois, which together represent more than half of
all government payroll costs in the state. Also left out are
billions of dollars in public construction projects, all of which
come with the inflated cost of workers’ compensation insurance here.
Instead of trying to solve this problem, legislative leaders have
chosen to peddle wild conspiracy theories.
Steve Brown, spokesman for Illinois House Speaker Mike Madigan, has
blamed high costs on insurance companies not passing along savings
to customers. There is no evidence supporting this claim, and it
would require collusion among more than 330 rival insurance
companies in Illinois, in violation of federal anti-trust law.
And the trial lawyers who bankroll Madigan’s machine would have been
all over any kind of insurance price-fixing scandal. After all,
people and businesses harmed by federal anti-trust violations can
seek triple damages.
Those trial lawyers like the system the way it is.
That’s why Illinoisans continue to see public dollars wasted on
paper cuts, sprains and bruises. And it’s why reform is needed now
more than ever.
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