Problem created by court decision is raising small business premiums
The Pennsylvania House has approved a bill that will fix a problem with the state workers’ compensation system that is sending costs up and premiums soaring. The problem arose when the state Supreme Court ruled that a section of the state’s Workers’ Compensation Act is unconstitutional because guides used by physicians for determining an employee’s level of disability come from a private source, the American Medical Association, and the reference guides are not regularly updated under the law. NFIB, which represents 14,000 small businesses in Pennsylvania said the ruling puts employers in the untenable position of being unable to determine if an employee is permanently or just partially impaired and whether their benefits should continue.
“Small businesses with a limited staff already have a difficult time when an employee goes on temporary disability. This court decision prevents a doctor’s review of that worker’s progress and their ability to return to work,” said Rebecca Oyler, NFIB’s legislative director in Pennsylvania. “This decision by the Supreme Court has thrown employers, and the state’s workers’ comp system into total turmoil and significantly raises costs.”
The case, Protz v WCAB (Derry Area School District), involved an employee who hurt her knee on the job. After temporary total disability leave and benefits, the worker was later evaluated by a physician and found to be only 10-percent disabled. Her status was changed to reflect a partial disability and the duration of benefits became limited. The employee challenged the evaluation.
“As a result of the court’s decision, employees found by licensed physicians to be just minorly disabled, are now likely to head to the courthouse seeking a reinstatement of full disability benefits,” said Oyler. “This is a simple legislative fix addressing the specific problem the court found with the current state law.”
The legislation, if passed will prevent the increased costs and turmoil in the workers’ comp insurance marketplace. Now that it has passed the full House, the bill heads to the Senate.