When we talk about inefficient and problematic states in workers’ comp, Kentucky doesn’t normally draw a lot of attention in the conversation. In fact, when we held our series of Workers’ Comp Summit meetings in 2016, Kentucky was a state cited by some in the room as one state having a system that generally worked. It’s not that anyone is raving about the stellar structure of comp in Kentucky, but you just don’t get the feeling that it is the number one state on the “makes me want to cut myself” list for comp professionals around the nation.
Yet leaders in the state see items they say needs fixing, and the fix is now in. Governor Matt Bevin signed HB 2 into law at the end of March.
Some of the changes resulting from this reform effort are not unusual for our day. It addresses the opioid crisis with an evidence-based pharmaceutical formulary and medical treatment guidelines. It increases maximum compensation rates for employee temporary total disability, permanent total disability and permanent partial disability benefits. One thing that will catch people’s attention is the provision that will limit the number of drug screens for which an employer must be financially responsible. That is an important point, given recent revelations about potentially abusive drug screening processes by some physicians who view their patients as a profit center.
Probably the most controversial element of this new law is that it will place a cap on the amount of time benefits will be paid for some permanent partial disabilities. For injured workers who fall into those categories and are PPD, benefits will be restricted to 780 weeks, or 15 years. The legislation does however provide for a recertification process that would give the worker an opportunity to request an extension of benefits if they can show they are still needed.
This last item appears to have drawn the most fire from opponents of this legislation. Personally, I do not have an issue with that type of structure. To some in the comp community, arbitrary caps on benefits are pure anathema, and show a complete disregard for the rights of the injured worker. Outside our industry, however, there are very few things with such permanency when dealing with “permanent” issues. Recipients of Social Security Disability (SSD) and Supplemental Security Income (SSI) are subject to regular reviews to justify the continuation of their benefits. Benefit recipients in those programs generally are subject to a review every 3 to 7 years, depending on the nature of their disability or situation. The notion that benefits once assigned should be permanent regardless of eventual outcome seems to emanate solely from the halls of workers’ comp.
The concept adopted by Kentucky appears, on the surface at least, to have taken reasonable steps controlling long term costs while providing a vehicle to provide benefits for those still in need.
What this argument really highlights is our industry’s continual struggle with the definition of the word “permanent” and our outmoded thinking on the concept of disability. No one is better than workers’ comp at turning a slight impairment into a permanent disability. But that is likely a topic for a different day…..
So, Kentucky, a bastion of blahness when it comes to controversial comp conversation, has fixed a system many of us were unaware needed fixing. The fixes in some areas (opioids) will definitely be helpful, and the rest (IMHO) don’t appear to be too controversial. Who knows? If these reforms are effective, they could make Kentucky even less exciting to talk about in the future.
I suppose that should be the goal of every workers’ comp system.