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Retrospective Rating Groups and Legal Conflicts in L&I Workers’ Compensation Claims

Lately I encounter more and more conflict in L&I claims. What I mean by conflict, in the context of this article, is disagreement over work injuries that results in litigation. I attribute the increase in L&I claim conflicts to the Retrospective Ratings program. They are sometimes also called retro groups or retro-rating groups.

What is Retrospective Rating program?

According to The Department of Labor and Industries (L&I) the Retrospective Rating program is a safety incentive for employers to reduce the amount of workplace injuries. Additionally, employers can earn a partial refund of their workers’ compensation premiums. Refunds are available whenever claim costs are lower than expected. L&I calculates employer premiums either 10 months after the coverage period ends, or retrospectively for that 12-month period.

L&I created this program to promote workplace safety and lower work injury and accidents. However, it is entirely inconsistent with what workers’ compensation is all about. Workers’ compensation, by definition and by law, is there to provide relief for people with a work injury, without questions of fault or negligence. Instead, the Retrospective Rating program only weakens the most basic principles of workers’ compensation. Furthermore, it created a new set of conflicts in workers’ compensation claims.

Retrospective employers and retro groups

Under Retrospective Ratings, employers and employer groups hire legal representatives to prevent work injury claims just to keep work injury claim costs low. I recently see an increase in client calls from people with work injury dealing with employers that are forcing them into litigation. In turn, work injury claimants must hire a workers’ compensation attorney and legal representation and mount expensive legal battles just to get their workers’ compensation claim allowed. There is nothing here that increases work safety or reduces work injury occurrences.

Employers taking advantage of retrospective groups

One retrospective group advertises that they secured over $600 million in premium refunds for its 1000 employers. Another group has a picture of a work injury claimant on the beach as their cover photo. Others advertise that they assist employers in reducing the number of L&I claim incidents and costs. While some groups appropriately focus on helping employers achieve safe work environments, others could not care less about this objective.

While employers are enjoying things like ~$600 million in premium refunds, victims of a work injury are suffering. These days, L&I will reject a claim because the retrospective ratings employer or group convinces them to do so. It can cost work injury claimants $2500-$5000 just for expert medical testimony to prove the decision is wrong. Most people that suffer an injury on the job cannot afford this, and the Department rejects their L&I claim. They are often left on their own to try and obtain treatment and recover from their occupational disease or industrial injury.

Retro groups – summary

The Retrospective Rating program missed its mark. Rather than incentivizing employers to have safer workplaces, it encourages them to engage in sanctions and L&I claim suppression. From my perspective, with programs like the Retrospective Raring program, L&I is failing in its duty to provide sure and certain relief to work injury victims.

L&I Claims and the Bias in Independent Medical Exam (IME) Reports

/ L&I attorney / 8 Comments

Independent Medical Examinations (IME) are part of every L&I claim and workers’ compensation claim in Washington State. Doctors that perform IME exams must have a certification from the Department of Labor and Industries (L&I). In turn, they provide L&I with an IME report. When performing IME tests, doctors have to abide by certain rules and regulations. These rules are available in L&I’s Medical Examiner Handbook. However, if that’s the case, then why is there bias in almost every IME report?

Bias in workers’ compensation IME exam and report

As a workers’ compensation attorney, in my experience, IME doctors often demonstrate clear bias. In many cases, they ignore relevant sections of the law and ignore accepted conditions under the claim. Furthermore, it’s common to see internally inconsistent exam notes and reports. Interestingly, L&I still accepts the results of bad IME tests. Even though they are undoubtedly contrary to the law and to the facts of cases and claims. Personally, I’m fed up with this trend, which neither helps L&I nor work injury claimants.

The reality of IME exams in L&I claims

Here are some examples of issues from actual cases.

Clearly biased

I recently cross-examined an IME provider who opined that the work injury claimant did not want to return to work. An opinion like that is nothing but biased, especially when it comes to the facts of the case. Looking at the facts, my client has been working and maintaining a job since the time of the examination.

Ignoring the law

In another workers’ compensation claim, the IME doctor states that the injured worker doesn’t need additional treatment. Furthermore, the doctor said that if the claimant needs a new MRI, then the MRI is not a treatment rather it’s diagnostic. The doctor’s response made my blood boil. In Washington State, people that suffer a work injury are eligible to receive necessary and proper health care services.

Ignoring accepted conditions

I recently received and reviewed an IME report. I was shocked when I saw the IME provider arguing that the complex medical condition does not exist. All while the work injury claimant is receiving ongoing treatment for the condition on a monthly basis. On top, L&I accepted the condition as final and binding years ago. At this point in the L&I claim, it’s very possible that L&I will accept the IME’s opinion. I won’t be surprised if L&I uses the wrongful report to make adverse determinations in this workers’ compensation claim.

IME report can be internally inconsistent

I came across yet another IME report the other day. Here, L&I asked the IME examiner to consider 3 possible jobs for my client following the work injury. All three jobs require prolonged standing on feet, which the work injury claimant can’t tolerate because of their industrial injury. In the report, the IME examiner disapproved 2 of the jobs. However, for reasons unclear to me, the IME doctor approved the 3rd job. Even though it also requires prolonged standing. L&I terminated time-loss compensation benefits and closed the workers’ compensation claim.

Some personal notes and conclusions about IME report quality

IME exams are now big business in Washington State. Unfair and biased exams don’t help L&I because as an L&I attorney, I’m ready for a legal fight. The fight is very costly to L&I. These IME reports also don’t help people that had a work injury. It stalls their L&I claims and their ability to return to work.

I believe that L&I needs to revisit the misuse of IME exams. They need to employ corrective measures. That means obtaining unbiased and consistent opinions. IME tests must rely on the facts and the reality of cases and claims. They must also comply with workers’ compensation law in Washington State.

LNI workers compensation claim Kept on Salary

L&I Workers Compensation Claim and the Kept-on-Salary Benefit

/ L&I attorney / 33 Comments

People that can’t work because of their industrial work injury or occupational disease in Washington State can receive time-loss compensation benefits. Single people with no dependents sometime struggle because the time-loss compensation rate is 60% of what they were making at the time of the work injury. However, keep in mind that you don’t pay taxes on time-loss compensation benefits under a workers’ compensation claim. In other words, when calculating your taxable income, L&I claim payments aren’t taxable. The purpose of this article to explain similar benefits such as kept-on-salary.

L&I claim and time-loss compensation benefits

Time-loss compensation benefits are vital for work injury claimants. At the same time, many employers are very frustrated by this benefit. They are frustrated because L&I rates go up when their employees receive time-loss checks. Businesses often argue that it’s unfair. In response, L&I created several incentive programs to help employers keep their rates down.

I don’t have a problem with the Department of Labor and Industries (L&I) working to keep employer L&I rates down. However, I am incredibly critical of L&I’s application of their incentive programs. From my standpoint, I strongly believe that L&I gives employer-incentives way too easily without appropriate oversight or enforcement. As a result, workplace injury victims are being punished while employers are rewarded for unfair use of incentives.

The L&I Kept-on-Salary incentive program for employers

One incentive that works well for employers (and not so well for people with a workers’ compensation claim, especially with self-insured employer) is called Kept-on-Salary (KOS). Like its name, the idea is that a person that suffers work injury continues to receive regular paychecks, even when they can’t work. If you search online, you can find several articles about KOS that help employers reduce their L&I rates and save money. However, there isn’t any information on the L&I website for the Kept-on-Salary program.

Despite having no information for work injury claimants, the Kept-on-Salary plan is available. In fact, it’s governed by RCW 51.32.090 and RCW 49.46.210. Under these rules and regulations, if a work injury claimant is under the Kept-on-Salary program, then they are not getting time-loss compensation payments.

How does Kept on Salary work in L&I claims in Washington State?

In short, if a work injury claimant is on kept on salary, it means that the employer continues to pay the worker. However, the employer must meet several conditions:

The injured worker shall receive a total of all wages (i.e., form all employers and jobs) as of the date of their work injury. This includes absolutely all payments that the work injury claimant was getting before. Even after-hours or jobs outside the scope of his or her work hours with the employer of injury.
The wages must include the benefits that the worker had prior to the work injury. Specifically, payments include healthcare benefits, housing (when applicable), fuel expenses and reimbursement, and so on. On top, it must include tips, shift-change or overtime pay, bonuses, and all other expense and benefits.
The employer can deduct certain amounts to comply with state or federal law. However, the employer cannot make any other deductions.
The employer must pay wages on a regular schedule at least once a month.

Employers misusing the Kept-on-Salary incentive

Employers can’t mandate workers to use benefits they earned over time such as vacation, sick leave or paid time off, to keep from paying time-loss compensation. Therefore, if an employer is making you take time off or vacation and doesn’t pay for that time, then you’re not under the Kept-on-Salary plan. This is one aspect of the program that employers can abuse. After all, L&I relies on employers to report if the L&I claim worker is on KOS.

Practically speaking, the problem is the shocking lack of remedy for people with a workers’ compensation claim. Employers can easily abuse this benefit because there are no real penalties or oversight. More explicitly, L&I does not seem to actively check the facts or the reliability and consistency of employer reports.

The reality of the Kept-on-Salary program

In my experience, employers are often not adhering to KOS requirements. I cannot tell you how many times I’ve had to collect evidence to prove the employer is not meeting the requirements. The process tends to be long, drawn out, and incredibly stressful for people trying to move their L&I claim.

In conclusion, incentives to help employers to reduce L&I rates make some sense. However, L&I needs to do a much better job to ensure that those incentives do not have a punitive impact on people that suffer a work injury.

Workers Compensation - Washington