WASHINGTON, D.C. – Steve Schneider, Midwest region vice president for the American Insurance Association (AIA), today issued the following statement on the Illinois Legislature’s passage of HB 1698, so-called workers’ compensation reform legislation, just prior to the session’s adjournment last night. Illinois’ workers’ compensation system is one of the most expensive in the nation and in need of systemic changes. Despite passage of HB 1698, future efforts to significantly reform the system remain necessary in AIA’s view.
Mr. Schneider’s statement follows:
“AIA has actively worked with employers and legislators to promote adoption of meaningful reforms to Illinois’ workers’ compensation system. While perhaps well-intentioned, HB 1698 is unlikely to produce the much-needed outcomes to ultimately reduce the costs of Illinois’ overly-expensive system.
“During this legislative session, AIA advocated reforms including required use of the American Medical Association (AMA) Impairment Guidelines, employer direction of medical care, medical fee schedule reductions, and enhanced utilization review authority among others. While these issues appear to be addressed in HB 1698, the legislation unfortunately provides sufficient ambiguity and flexibility to allow for continued systemic abuse thereby reducing their true potential value.
“Proponents claim adoption of HB 1698 will produce cost savings of nearly $700 million in reduced expenses but these figures have yet to be independently verified through credible actuarial analysis. That analysis and the manner in which these changes are implemented will govern whether the expectations of its proponents will be fulfilled or whether the 2011 ‘reforms,’ like the 2005 ‘reforms,’ will end up disappointing stakeholders.
“Illinois’ workers’ compensation system continues to require meaningful reforms that will truly reduce costs and deter abuse in order bring the Land of Lincoln in line with the rest of the nation. AIA believes Illinois still has a long way to go.”