MONTANA SELF INSURERS' ASSOCIATION
December 2021 Update
- WCCM – the Montana Labor Business Coalition Formed
- AMA Guides Updates
- MSIA Named to NCSI Executive Committee
- MSIA and WCRI
- MSF Starts Search for New President
- WCCM – the Montana Labor-Business WC Coalition Formed
MSIA was the catalyst in forming a new Labor – Business Coalition to discuss workers’ compensation issues and to provide public policy recommendations. Our effort to continue the Labor Management Advisory Council (LMAC) has morphed into the Workers’ Compensation Council of Montana (WCCM – not to be confused with WCC which is the Montana Workers’ Compensation Court).
MSIA initially suggested to Governor Gianforte he re-appoint the LMAC with perhaps a slight modification to the expectations. The Governor declined and offered Department of Labor and Industry Employment Relations Division (ERD) research support if a private group of labor and business leaders wanted to review workers’ compensation issues and recommend public policy directions outside of government. Your MSIA Board of Directors accepted the Governors’ challenge and contacted both labor and business leaders to create the WCCM. The first WCCM meeting was held on Monday, December 6 where all agreed to an organizational Charter, created the Labor and Business Caucuses to operate and accepted some ground rules to make decisions.
The group (in no particular order) consists of:
- Al Smith – MT Trial Lawyers Association
- Bridger Mahlum – MT Chamber of Commerce
- Jim Larson – Teamsters
- Lance Zanto – Montana WC Mgt Bureau
- Don Judge – Labor leader
- Aimee Grmoljez – Amer P & C Ins Association
- Kim Rickard – Montana Laborers
- Vicki Evans – MT Contractors Comp Fund
- James Holbrook – AFL – CIO
- Mike Marsh – Midland Claims Service
- Kevin Braun – MSF General Counsel
- Peter Strauss – MSIA
The Labor caucus selected Don Judge as the Labor co-chair and the Business caucus selected MSIA Executive Director Peter Strauss as the Business co-chair and both agreed to some ground rules for operation. ERD confirmed they would provide research and background material support for the effort. WCCM is not a public organization and therefore not subject to public meeting requirements. At the same time we accepted that the group is not exclusive – if others want to attend meetings they are welcome and that materials created by ERD were public documents. Labor and business, each have five voting seats. After the meeting, Lance Zanto cited work obligations as taking him away from the committee responsibilities and requested he not be considered as a voting member. Business has to decide which of the six remaining members will have voting rights – as co-chair, MSIA will be one of those five. We also agreed that for a WCCM position on an issue, at least 75% of members from each side must vote in favor of the position. We will have made provisions for electronic attendance at the meetings and electronic voting.
Beyond the organizational aspect of the meeting the group discussed the updates to the AMA Guides 6th Edition. Current Montana law MCA 39-71-711 requires the use of the 2008 6th Edition of the AMA Guides as the basis for impairment ratings. Jean Branscum, Executive Director for the Montana Medical Association shared their perspective that there is little if any, new medical thinking in either the 2021 updates or the 2022 updates. As reported in the November 15 MSIA Update EXTRA (available to members at Montana Self Insurers' Association (mtselfinsurers.org), in addition to no new medical thinking in the new updated, the electronic only version was more costly, cumbersome and confusing to use, lacked tools for efficiency and resulted in more time to calculate an impairment rating.
In their first position WCCM unanimously agreed (with MSF and APCIA abstaining), to encourage Governor Gianforte and legislative leaders to oppose changing our law to update the AMA Guides currently in use. That is, to not accept the 2021 or 2022 updates to the AMA Guides as the basis for impairment ratings in our workers’ compensation system. In short, WCCM found that making the change would not benefit injured workers, nor the Montana system. In addition to accepting the medical community’s perspectives WCCM identified that making annual changes to the standards by which impairment ratings are calculated will generate more questions and more work than improve the systems’ operation. Until the law changes, the 2008 6th Edition of the AMA Guides will continue to be the basis for impairment ratings. When the communication to the Governor and legislative leaders is finalized, we will provide you a copy.
The next WCCM meeting is set for January 18 and agenda items include:
- a review of the pending Independent Contractor rules to enact SB 367
- he HB 495 task force reviewing the inclusion of PA and APRN’s as part of the definition of “physician” for workers’ compensation purposes, and
- an overview of the current MT WC system benefit structure (ERD will provide a comparison of the MT benefit structure to other state systems).
AMA Guides Update
The AMA intends to update the Guides to the Evaluation of Permanent Impairment 6th Edition first published in 2008 on an annual basis (as discussed above). As well they will make the Guides available through an electronic subscription service only.
AMA has announced the 2022 changes https://ama-guides.ama-assn.org/books/pages/2022_summary_of_updates will be considered the most recent edition effective January 1 and are available as of December 9. AMA continues to reach out to workers compensation stakeholders for input in creating the Guides and updates. I have attached the AMA November/December Guides Alert for you to see more about their plans and efforts. The articles included provide some information regarding application of the 2008 version of the AMA Guides 6th Edition. MSIA is on their email list, so as additional information of note comes through, I will pass it on.
MSIA Named to NCSI Executive Committee
The National Council of Self Insurers asked me to serve as a member of their Executive Committee to help guide the organization and plan their meetings. I expect working with national and other regional self-insurers and associations through NCSI will give MSIA members greater access to information, training opportunities and the latest in trends nationally and from other state systems. I am honored we have been asked to serve and look forward to the work on your behalf. You can learn more about NCSI through their website, https://www.natcouncil.com/
MSIA and WCRI
In the budget adopted by the Board and at the Annual Meeting in September, we included funds to become members of the Workers Compensation Research Institute (WCRI). WCRI is a worker’s compensation “think tank” and includes all stakeholders as members and directors – business, labor, insurers, TPA’s, medical providers, public policymakers defense and plaintiff attorneys and others regularly participate in WCRI efforts. WCRI studies, research and publications are routinely held up as a gold standard for objective information regarding workers’ compensation systems results. WCRI studies and reviews have been used as the basis for reforms of state systems – such as the 2007 Montana Administrative Inventory which lead to our 2011 reforms. WCRI does not take positions on issues nor results, it only reports based on the system data.
On a regular basis, WCRI publishes a review of workers’ compensation laws by state, a WC Medical Price Index, National Medical Cost Containment Inventory. In July of this year they published their study, The Early Impact of COVID-19 on Medical Treatment for Workers’ Compensation Non-COVID-19 Claims (their titles are typically that exciting).
One word of caution – typically WCRI studies do not include Montana system data as we do not generate enough data to make a statistical difference in national results and Montana carriers nor the state are contributing members of WCRI. However, their results, combined with our knowledge of the Montana system, provides some insight into national trends and results as they may impact our system. MSIA now has access to WCRI national and state reports as well as additional access to WCRI members and staff. If there is WCRI work you would like, please let me know.
MSF Starts the Search for a New President
MSF President and CEO Lanny Hubbard announced his retirement to be effective June 30, 2022. Hubbard has been with MSF since 1989 when he was hired as a claims attorney. Since then, he has served as Underwriting VP, Operations VP and since 2003, President and CEO. He is the longest serving state fund President in the country.
Mike Marsh, MSIA Secretary/Treasurer, was appointed by Governor Gianforte to the MSF Board of Directors and at one point offered he would be interested in the position. He has since reconsidered based on obligations to his parents in Billings and determined moving to Helena at this time was not the right thing to do for he and his family.
The MSF Board has retained outside counsel, an HR consultant and a compensation consultant to assist them in the nation-wide search. The long-time HR and compensation consultant the Board had used and who was a consultant for many other state funds in the country, passed away last year, so retaining these services is not particularly new for MSF. At the same time, MSF has gone 18 years without needing to replace the President and CEO. As the largest WC carrier in the state (and in the top 100 WC carriers by premium in the country), being somewhat attached to the state, as well as somewhat regulated by the Commissioner of Securities and Insurance MSF fills a unique role in the marketplace. MSF is required to provide coverage to the largest employer in the state (the state itself) as well as accept all who seek WC coverage. At one point they had more price flexibility than private carriers, but that ended in 2016, so they must accept all risks within their regulatorily approved rating plans.
MSF has some freedom from the states’ compensation plan. Although its’ non-managerial employees are members of the state employees union, they are their own bargaining unit and MSF can set salary levels where they want. MSF retains a compensation consultant to identify the range of private sector for insurance professional positions (underwriters, claims examiners, nurses, etc.) and within the Helena market for clerical and non-insurance professional work for example facilities maintenance. At the same time, MSF is required to use the states’ benefits program and pays the state for those benefits as well as a fee imposed by the state for access to those programs. MSF is not taxed by the state, and state general revenue funds (our tax dollars) do not support the MSF operations regarding policies sold and serviced since July 1, 1990.
Happy Holidays from MSIA
Just a personal note from MSIA to wish you and your families the best wishes for a happy, healthy and safe holiday season. I am grateful for the opportunity to work with you and to continue to work as a workers’ compensation professional. Thank you for all your support and assistance this past year. Please take the time to thank and enjoy your families and appreciate the unique opportunities we have by being in Montana. My NYC relatives keep asking, why do we live in Montana – the best response is, “Because we can.”
Peter Strauss, Executive Director
Montana Self Insurers Association
520 Monroe Ave
Helena, MT 59601