Two proposals have been introduced recently and would reform worker’s compensation programs in Wisconsin.

Workers’ Compensation Advisory Council (WCAC) Proposal

Last month, the WCAC negotiated several proposed changes to the workers’ compensation program that were agreed upon by both labor and management representatives.

The Department of Workforce Development (DWD) is working to put these changes into a draft bill that will be reviewed and is likely to receive final approval by the WCAC in December or early January. Once the draft is approved by the WCAC, it will be forwarded to the Legislature for consideration.

The worker’s compensation reform drafted bill’s key policies include:

  • Reduces the statute of limitations from 12 to six years
  • Apportions the percentage of liability of a permanent disability to that which is due directly to work-related injury
  • Applies the existing pharmacy fee schedule to medications dispensed outside a licensed pharmacy
  • Limits charges for physician-dispensed drugs to the average wholesale price
  • Limits recovery of indemnity benefits if an employee violates the company’s drug or alcohol policy
  • Denies temporary total disability when an employee is released to light duty work and later terminated for good cause
  • Increases for two years the supplement benefit eligible dates and rates.
  • Allows providers to charge a fixed rate of $10 for electronic medical records, not to exceed $100
  • Allows prospective orders from an administrative law judge for vocational retraining
  • Reinstates statutes that prohibit reduction in temporary disability benefits for vocational retraining for part time work

Assembly Bill 501 (AB 501)

In addition, several state legislators have recently introduced AB 501 which is aimed at addressing potential fraud and abuse in the workers’ compensation system.

Key provisions of the bill include:

  • Reduces the statute of limitations from 12 to two years
  • Allows for reduction of benefits if an injury is caused by negligence attributed to the employee
  • Allows for an offset of benefits by Social Security income, not just Social Security disability income
  • Allows for the denial of benefits during a healing period if an employee is brought back to light duty work but is later suspended or terminated for misconduct or substantial fault, as defined by unemployment insurance law
  • Prohibits recovery of workers’ comp benefits to an employee who knowingly falsifies their physical condition on an employment application if the employer relies upon this false information for hiring and there is a causal connection between the injury and the false information
  • Eliminates the escalation of wages during a renewed period of disability and instead uses the date of injury wage to calculate benefits owed
  • Eliminates minimum permanent partial disability ratings when it is shown that no actual impairment resulted from the injury
  • Allows prospective retraining orders
  • Requires employees who suffered permanent partial disability to resubmit to a medical re-examination every three years for DWD reevaluation
  • Requires employers with health benefit plans to provide employees covered by the plan their choice of practitioner within the plan
  • Allows employers to direct care for employees not covered by an employer health plan

Now is a good time to hear from you on how these reforms may impact your company. If there are changes that you would like to see, we have an opportunity to work with legislators and through other business associations to amend the bills. Both proposals are likely to begin their way through the Legislative process over the next few months, and we will continue to update you on changes as they develop.

Learn More about the Workers’ Compensation Reform 

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