SAWCA Regulators Roundtable

At the 2022 Sothern Association of Workers’ Compensation Administrators (SAWCA) All-Committee Conference, a panel of industry regulators discussed some of the challenges they are facing. Represented states included:

• Colorado
• Delaware
• Georgia
• Kentucky
• Louisiana
• Maryland
• Mississippi
• New Mexico
• South Carolina
• Tennessee
• Texas
• Virginia
• Wisconsin

Maximum Indemnity Benefits

There are concerns from state regulators that low wage workers are significantly harmed when they are only receiving two-thirds of their standard wages in workers’ compensation benefits. Employees receiving little pay prior to their injury cannot survive on even less financially.

Most states index their maximum workers’ compensation rates to the state average weekly wage, and statistically, wages have been climbing. Maryland increased their maximum rate by 30% over the last two years. Georgia is one of two states where the maximum rate is defined by statute instead of being indexed, so new legislation is passed on this issue every two years.

Claims for Home-Based Employees

With a significant increase in the number of people working from home, jurisdictions are now receiving remote work-related claims. There have not been any state rules or statutes created that outline what makes a home-based claim compensable. Final decisions on compensability are usually based on facts specific to each case, which are used to determine when the injury occurred throughout employment.

Independent Contractors

The U.S. Department of Labor (DOL) recently issued a 184-page report, proposing guideline changes to significantly reduce the number of workers classified as “independent contractors.” State regulators noted that the information from the U.S. DOL is simply “guidance” not codified by statues, so states are not bound to them. Many states have statutes on this issue, while others have defined this through state Supreme Court cases.

Many states specifically exclude “domestic workers” from workers’ compensation, but this leaves employers open to civil suits if an employee is injured in the workplace.

Success Stories

SAWCA provides an opportunistic forum for industry regulators to learn from one another. Several states have recently amended their utilization review and treatment guidelines to streamline the process and advance authorizations. When one state discovers a more efficient path, other states tend to follow. States are also beginning to use “rocket dockets” to expedite medical dispute litigation.

Mediation is being used in some states to expedite claim settlements. This deviates from the standard usage of trials and employs alternative dispute resolution, accelerating decisions and saving costs.

Virtual hearings have successfully continued post-pandemic, helping with preliminary and procedural hearings. This change has also reduced both attorneys’ and injured workers’ “windshield time,” or miles traveled for a short hearing.