443 Lafayette Road N. St. Paul, Minnesota 55155 www.doli.state.mn.

us

(651) 284-5000 1-800-DIAL-DLI TTY: (651) 297-4198

Workers' Compensation Advisory Council December 13, 2006 Minutes
Voting Members: Stan Daniels Don Gerdesmeier Glen Johnson David Olson Reed Pollack Bradley Robinson Gary Thaden Brad Lehto for Ray Waldron Voting Members Excused: Wayne Ellefson Susan Olson for James Cavanaugh Mike Hickey Voting Members Absent: Julie Schnell Non-Voting Members: Senator Tom Bakk Representative Mike Nelson Non-Voting Members Excused: Representative Denny McNamara Non -Voting Members Absent: Senator Geoff Michel Staff: Scott Brener Debbie Caswell Penny Grev Patricia Todd Jana Williams Visitors: Paul Cassidy; Leonard, Street & Deinard Nancy Caven; Alaris Group David Clark; Western National Insurance Dave Dederichs; MN Chamber of Commerce Karen Clayton Ebert; MCIT Ken Gildow; RTW Kevin Gregerson; Wilson-McShane Tom Hesse; MN Chamber of Commerce Brian Hicks; MAPS Steve Hollander; MARP Todd Johnson;WCRA Nancy Larson; MARP Tammy Lohmanl Commerce Bob Lund; State Fund Mutual Andy Morrison; Koll, Morrison Sara Novneskyl MMA Dorothy Quick; Columbia Park Medical Group Tim Searls; Searls & Associates Scott Sexton; Corvel Doug Stacy; WCPA Linda Carroll Shern; PhRMA Mike Wilde; IUOE Local 49 Dan Wolfe; MN APTA David Wulff; MTLA

Commissioner Scott Brener called the meeting to order at 9:43 a.m. Roll was called and a quorum was present. Glen Johnson made a motion to approve the minutes from the March 1, 2006, June 14, 2006, and October 11, 2006, meetings as presented. Don Gerdesmeier seconded the motion. All voted in favor of the motion and it passed.

This information can be provided to you in alternative formats (Braille, large print or audio tape). An Equal Opportunity Employer

Workers' Compensation Advisory Council Minutes

-2-

December 13, 2006

V. A. Commissioner's Update Brener noted this is the second term of the Pawlenty administration. He presented his expectations and perspective of the workers' compensation element at the Department of Labor and Industry (DLI). He supports the role of the Workers' Compensation Advisory Council (WCAC). It was his understanding, based upon a meeting of the WCAC several months ago, that members would like to move forward with a more substantive bill proposal during the odd years (the budget years) at the Capitol, which would include 2007. From a leadership side, Brener does not anticipate any changes at DLI. They have made substantial changes in the workers' compensation management core over the last two years and have brought in a strong team of leaders. They look forward to maturing that group and providing a more efficient Workers' Compensation Division administrative process. Brener outlined a need to streamline the administrative side of the system and noted Patricia Todd is heading up an initiative to move DLI's systems from an electronic imaging-based system to a data based processing system. It would be the most substantial data based workers' compensation program in the country. Brener noted the employer and employee representatives on the WCAC have been meeting to discuss the 2007 legislative proposal. The parties are meeting again in early January and DLI will work with them. He noted the calendar in the House may be very busy and the WCAC needs to be cognizant of that in order to the find appropriate committee time to review the WCAC legislative bill. Brad Lehto asked if the department will have some proposals Brener said it did have some housekeeping items and constituents have approached DLI about proposals. Stan Daniels felt it was time to focus on discussions regarding benefits. He suggested that if the WCAC did not look at benefit increases, the injured workers would do it without going through the WCAC. He would like it to be addressed properly for the injured workers' at the WCAC, since that is the purpose of the WCAC. Brener expressed a willingness to discuss anything the council wishes. Brad Lehto reported that they discussed benefits with the employer representatives on the WCAC. He has suggested legislators not introduce legislation, even if it increases benefits, and encourages them to come to the WCAC. There is some added pressure this year to bring forth legislation. Brener noted there has been a steady stream of proposals asking for cost containment and the WCAC will need to find common ground between the various perspectives. Glen Johnson suggested legislative guidelines for cost containment to control what insurance companies can charge for workers' compensation. He has had phone calls from companies saying they can only buy insurance from two or three companies in this state, which limits their ability to obtain worker's compensation coverage at a lower cost. He asked what dictates those rates and whether there was no competition available. Brener commented it was his understanding that the insurance market softened up some over the last twelve months. He

Workers' Compensation Advisory Council Minutes

-3-

December 13, 2006

noted some states have limited this by having a monopolistic workers' compensation system. He is not necessarily advocating for that but it is how other states have dealt with some of those issues in the past. Johnson asked DLI to get information regarding this issue. Lehto asked if any of the proposals generated by the three WCAC road trip meetings were being looked at. Brener said those issues would be fed into the pool of legislative proposals. Lehto recalled there were some issues that could be looked at and handled internally at DLI, such as dispute resolution. Brener said DLI has been focusing on strengthening its mediation process. Todd noted that she is expanding and refining DLI's administrative dispute resolution processes. This initiative is in the beginning stages and it is anticipated it will take another full year. Brad Robinson announced that he would be retiring from the WCAC. Brener expressed appreciation for the time and effort he has given the department over the years. Robinson was thankful for the opportunity and stated that the workers' compensation system is much better than it was 30 or 40 years ago and asked that the WCAC continue the effort. The next meeting of the WCAC is scheduled for 9:30 a.m. on Wednesday, February 14, 2007. Reed Pollack made a motion to adjourned at 10:02 a.m. David Olson seconded the motion. All voted in favor of the motion and it passed. Respectfully submitted,

Debbie Caswell Executive Secretary dc/s