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Workers’ Compensation Advisory Council Dec. 12, 2007 Minutes
Voting members present Mike Bredeck Marilyn Durenberger Wayne Ellefson Don Gerdesmeier Ryan Holmes Glen Johnson Bob Lux David Olson Susan Olson Bettye Shogren Gary Thaden Brad Lehto for Ray Waldron Nonvoting members present Senator Tom Bakk Representative Bob Gunther Representative Mike Nelson Nonvoting members absent Senator Geoff Michel Staff members present Kate Berger Debbie Caswell Michael Houliston Jayne Jones Shawn Peterson Steve Sviggum Patricia Todd Jana Williams Visitors present Lea Anderson; Rehab Carley Barber; Cook, Hill, Girard Ray Bohn; WCRA Karen Clayton Ebert; MN Counties Ins. Trust Dave Dederichs; MN Chamber Tom Hesse; MN Chamber Steve Hollander; MARP Angie Hunter; Rehab Nilani Jayatilaka: MMA Todd Johnson; WCRA Nancy Larson; MARP Mathew Lemke; Winthrop & Weinstein Andy McCoy; Fairview Andy Morrison; Koll, Morrison Bob Otos; Rehab Alison Otta; Rehab Dorothy Quick; Columbia Park Medical Group Scott Sexton; Corvel Mark Skubic; Park Nicollet Sue Stout; MN Hospital Assn Anna Thompson Mike Wilde; Local 49 Melissa Williams; Rehab Kelly Wolfe; Leonard, Street & Deinard Dan Wolfe; APTA David C. Wulff; MNAJ

I. Call to order and roll call The meeting was called to order at 9:38 a.m. by Commissioner Steve Sviggum. Visitors and Workers’ Compensation Advisory Council (WCAC) members introduced themselves. Roll was called and a quorum was present. II. Approval of the Nov. 13, 2007 minutes Mike Bredeck made a motion to approve the minutes from the Nov. 13, 2007 meeting. Gary Thaden seconded the motion. All voted in favor of the motion and it passed on a voice vote.

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V. Agenda items WCAC legislative proposal Assistant Commissioner Patricia Todd reviewed housekeeping and process-improvement proposals from the 2007 WCAC bill and answered any questions the WCAC members had. Information about a study regarding the construction collective bargaining agreement claims and a cost comparison was distributed. DLI will provide general descriptions and language for these housekeeping provisions to WCAC members for approval. Sviggum reviewed a proposal similar to the 2007 WCAC bill, including provisions for a medical cost package, labor-benefits, employers and good policy. Discussion occurred about a provision to make intoxication easier to establish by providing that intoxication need only be a contributing factor in an employee’s injury (rather than the proximate cause). Members expressed concern about increased drug testing, discriminating against alcohol versus other drugs – including prescription drugs – and strongly suggested looking at strengthening the Prohibited Act provisions. Discussion occurred about a provision to provide medical coverage, but not indemnity coverage, for undocumented workers who are hurt on the job. Glen Johnson suggested the burden should be on the employer that hired someone illegally and the state agency responsible for the laws that were broken. Thaden noted this would be a windfall to the insurer if the employer paid premiums and then the employee only got some of the benefits. Sviggum noted DLI is looking at language, at the request of the governor, to address this problem. Sviggum discussed a handout about hospital inpatient costs, charge rates and the “sweet spot.” He noted the overall goal is to increase benefits to workers. The Policy and Operational Work Groups met to provide a suggestion to the WCAC to get savings in the system, be competitive and get the dollars to those who need them. They heard from the Minnesota Chamber of Commerce and the hospitals, but the group did not come up with a final agreement. Sviggum laid out the approximate numbers to use to find the “sweet spot” and use the money saved for indemnity benefits. He distributed a proposal for inpatient hospital reimbursement, ambulatory surgery center reimbursement and medical billing reform to members and visitors he hopes would save some dollars the WCAC could use to reach an agreement to enhance benefits. He pointed out the highlights: • • • • need strong prompt-payment language so the payment amount is known and timely; the commissioner would appoint a working group to discuss medical documentation and auditing; rate-reducing bill-scrubbing would be eliminated; and get rid of prevailing charge and litigation.

To achieve these goals, implant reimbursement would pay the invoice cost plus 25 percent and hospital and ambulatory surgery center reimbursement rates were defined. DLI will develop a pilot program for recognizing centers of excellence and pay for results as an additional incentive. Sviggum noted the Minnesota Hospital Association did not agree with the proposal and pointed out a letter from its President Bruce Rueben. Employers did not agree either and prefer using the prevailing charge. Therefore, Sviggum’s proposal was a compromise between the parties.

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Discussion occurred and Wayne Ellefson expressed concern the WCAC makes sure a high level of patient care is maintained. Sviggum responded that his intent is to pay for good results. He reiterated the hospitals and the business community do not necessarily agree with his proposal. Employers do not want to get rid of prevailing charge. Hospitals want to get rid of it and Sviggum does too. His priorities are to provide for prompt payment, to get rid of bill scrubbers, no prevailing charge and a reduction to commercial rate plus 10 points with a minimum floor and maximum ceiling. WCAC members broke out into individual caucuses and a working lunch break from 11:45 a.m. to 1 p.m. Sviggum asked them to go through the provisions put forth and approve or disapprove them to come up with a proposal that does better for the injured worker. Sviggum asked if there were any points to raise after the individual caucuses. David Olson asked that language be drafted for the housekeeping and the process improvements, then sent to the WCAC members. He suggested the provision to use an employee identification number not mention Social Security numbers and should include letters and numbers. Lehto agreed to have the department draft housekeeping language. He noted they need to have more discussions, but they are getting closer to a bill. The WCAC could start with this language and can reach a conclusion to the bill. Sviggum continued to review the good policy, litigation, rehabilitation and other categories of the 2007 WCAC bill proposal. Discussion occurred about the litigation proposal at line 14 about subd. 7 proposal to eliminate reimbursement to employees for attorney fees when the employee’s attorney fees were actually paid by the employer/insurer. The judges expanded this provision so that it now reimburses money to the employee that the employee did not originally pay. It would be changed back to the original intent to reimburse monies paid by the employee. Thaden stated employers asked about the draft language in members’ packets regarding rehabilitation services for QRCs. Sviggum noted the QRCs made a request at the meeting last month and he thought it was reasonable. This language would respond to that QRC request and Sviggum wanted to consider putting it into the bill. Sviggum suggested Lehto and Olson meet with each other and their caucuses; he hopes to have a proposal at the Jan. 15 WCAC meeting, from Olson and Waldron. An additional WCAC meeting has been set for Tues., Jan. 15, 2008, from 9 a.m. to noon. The meeting was adjourned 1:16 p.m. Respectfully submitted,

Debbie Caswell Executive Secretary dc/s