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MONTANA SELF INSURERS' ASSOCIATION

Legislative Update 1/6/2023 – Week 1

  • WCRI Annual Meeting – Phoenix 3/21-22
  • Legislative Action and Speculation


  • WCRI Annual Meeting – Phoenix 3/21 – 22


MSIA is a member of the Workers’ Compensation Research Institute (WCRI) – a think tank on all things workers’ compensation. One of the things I like about WCRI is they involve all parties to the issues – labor, business, all medical professionals and attorneys of all stripes, regulators, insurers and all assorted off-shoots for all of those groups. I have found their information to be useful and more objective than not. As a result, some of the changes in workers’ compensation systems I have been involved with are based on their research and publications. 


Some of the changes in our own system were based on their 2007 publication, Workers’ Compensation in Montana, Administrative Inventory. As well, some of the significant changes we made in 2011 are directly related to their work. 


I have attended a number of the WCRI Annual Issues and Research Conferences over the years and they are among the best workers’ compensation meetings. While WCRI does not have Montana data, per se as the state has not provided data to them, the topics are timely, pertinent and valuable to the US workers’ compensation system. And, ultimately what happens elsewhere, finds its way to being discussed in the Montana system, if not acted upon. 


Here’s the information on this year’s conference – if you are a student of workers’ compensation, I recommend attending. WCRI's 2023 Issues & Research Conference (March 21-22) in sunny Phoenix, AZ


Below are some of the session topics: 


  • The impact of inflation, labor shortages, and a potential recession on the workers’ compensation system
  • Behavioral health issues to consider as workers return to work
  • The impact of the changing workplace, such as remote and hybrid work 
  • The latest WCRI research on long COVID
  • Selected findings and trends seen across WCRI’s benchmarking studies



  • Legislative Action and Speculation


MSIA is tracking a number of bills, some of which have been introduced, some of which have been drafted and most only titles of potential legislation. For those bills that have not yet been drafted, based on the legislator who requested work to be done and the title, I have included them on the list below and my thoughts. I am not privy to the specific details, but based on what I know and what I have heard around the Capitol halls, they are on this list. 


The list will grow and shrink as the session goes on. MSIA has many more bill titles on our list; most will not be introduced, but a larger list helps insure we do not miss something that becomes important. I will keep you informed of items on a weekly basis and if there is something specific to your business, I will let you know individually as well. For example, there are a number of bill titles this session dealing with unions and union membership. As a result they are not directly related to workers’ compensation, however, MSIA remains aware of them as MSIA members are involved with public entity and health care. 


Those bills which have been introduced, have either a House Bill (HB) or Senate Bill (SB) number. Bills which have been requested but not yet introduced, are referred as “LC” bills. This Update is based on information where it is available, or sound speculation on what the bills may look like once introduced, if introduced. The majority of LC requests are not introduced, but based on rules, are requested to allow the potential of creating a bill later in the session. 



HB 178               K. Walsh           R-Twin Bridges               This bill clarifies the law so that injuries which occur off the clock and as the result of social or recreational activity, are not compensable. The bill defines that a social or recreational activity is one that includes exercise, pleasure, relaxation or voluntary of optional preparation related to the employment. For example, should a ski area employee injure themselves while skiing off the clock during a work day, they would not be covered by WC in that specific instance. This bill was heard in the House Business 7 Labor Committee on Friday 1/13. The only opponent was the MT Trial Lawyers Association who claimed the law already provides for this and is otherwise, “code clutter.” Unfortunately, case law indicates that regardless of whether someone is on the clock or not, if they are on the employers’ premises, coverage applies (Popenoe v Liberty Northwest). MSIA testified in favor of this bill along with the MT Ski Areas Assoc and MSF. 


SB 22                  Morigeau          D-Missoula                      This bill is a clean-up of the attempt last session to require the Department of Labor to do more investigation in determining whether someone is an independent contractor or employee, rather than rely solely on the presence, or absence of an ICEC. This bill was negotiated through the Economic Affairs Interim Committee and the language at that time, was acceptable. It appears the language has changed to the extent that it requires much more work on the employers’ part. MSIA is working with businesses to create an amendment which will go back to the original intent, which was that the Department of Labor cannot use the presence or absence of an ICEC as dispositive of employment status. 


SB 126               Hertz                  R-Polson                          This bill re-pays the Montana State Fund those monies taken during the 2017 Special Session to replenish the Fire Fighters funds, and adds interest since that time. 2017 was a bad fire year and as a result the Fire Fighting fund was out of money. To continue the efforts, the legislature took some $28 million from MSF investments to make sure the fire fighting efforts were funded. The MSF Board brought suit against the state, and individual policyholders also brought suit; Senator Hertz was one of those policyholders. Ultimately, with new Board members appointed by Governor Bullock, the MSF Board reversed course and dropped their suit. However, the policyholder suit was ultimately heard in the Supreme Court. They dismissed the case on procedural issues and identified there were aspects of the case that had not yet been decided and could be subject to further court determination. As a resul,the inappropriate takings aspect of the suit is still pending. There are rumors this language is part of an effort to change the state fund’s ties to the state (see also LC 985 & 986). MSF has in the past tried to eliminate their ties to the state’s IT system and procurement processes as they hinder its’ ability to operate as an insurance company. There is also speculation that MSF may want to become policyholder-owned (a mutual?). This bill was heard in Senate Finance and Claims Committee on Thursday 1/12 with the D’s not buying the need to restore the funds and the more conservative R’s not accepting the financial need for this either. There appears to be no clear leadership position on the legislation as yet. MSIA is watching this bill and does not have a position at this time. 


LC 84                  R. Lynch             D-Butte                           This bill adds ovarian and testicular cancers to the list of presumptions of illnesses covered for firefighters. MSIA opposes this bill. 


LC 677                Nicol                   R-Billings                         Revise workers’ compensation laws to provide freedom of competition. There is no language to this bill title as yet. 


LC 679                Nicol                   R-Billings                         Revise workers' compensation laws related to illegal aliens. There is no language to this bill title as yet.


LC 681                Nicol                   R-Billings                          As drafted this bill would end the MSF payments to the State Auditor’s Office (SAO) to staff two FTE. In the 2015 session, as part of the agreement that the state fund would be regulated by the Commissioner of Securities and Insurance (SAO), that office entimated the need for two additional FTE to regulate MSF. As part of the agreement to pass SB 123 at that time, MSF was required to pay for those FTE, which has been done by intra-agency transfer since then. This bill, as currently drafted, would stop MSF from paying for those FTE. MSIA is watching this bill and does not have a position at this time. 


LC 985                Hertz                  R-Polson                          There is no language associated with this bill yet. MSF is preparing two bills and the speculation is these bill draft numbers (LC 985 & 986) will wind up being that language (see the note on SB 126). One of these bills may wind up being a proposal to have the MSF become ‘policyholder owned’ which may be the new way to say become more like a mutual insurance organization. I do not think MSF wants to completely be divorced from the state as in their role as a quasi-state entity, they are exempt from income and some other taxes and are able to serve as the guaranteed market. MSF does not want to give up that guaranteed market, in part because it will impact their income tax status, and will fight efforts to create an assigned risk pool for Montana. NCCI reports that assigned risk pools in those states that have them charge between 20 and 160% more than voluntary coverage, with the average 50% more. As well, the vast majority of policyholders in assigned risk pools are small businesses – the majority of employers in Montana. Not the least of the issues in this kind of proposal is how to address the MSF employee participation in the PERS – the state’s retirement system as well as the state’s employee benefits programs. MSF estimates it would take at least three years to accomplish this kind of change. MSIA is watching these bills and does not have a position at this time. 


LC 986               Hertz                  R-Polson                           There is no language associated with this bill yet. Apart from their potential of becoming a ‘policyholder owned’ organization, MSF sees a need to

separate themselves some from the state’s IT system and procurement processes. In their defense, when the state’s IT systems, or warrant writing processes go down, MSF is not on the priority notification list, and often does not know emails are either not going out, or coming in or that benefit checks are not be produced and sent. As well, the state’s procurement process is built for most state entities, not necessarily those who need specific insurance purchasing. Ultimately, the process, bogs down the MSF opportunities to efficiently do business. While there may be those who prefer that, it is not currently the position of MSIA. The language will likely provide some exemptions, as the judiciary has from the state’s IT system and as the Board of Investments has from the procurement process. MSIA will be watching these bills and does not have a position at this time. 


LC 1724              A. Olsen            D-Missoula                     Provide worker right to choose physician in workers' compensation case. There is no language associated with this bill as yet. Representative Olsen 

has either sponsored or supported this bill in the past and it is a Democratic leadership supported proposal. MSIA will oppose changing the current law regarding choice of physician. 


LC 1728              A. Olsen             D-Missoula                     Establish presumption in workers' compensation for COVID-19 There is no language associated with this bill as yet. Representative Olsen has either sponsored or supported this bill in the past and it is a Democratic leadership supported proposal. MSIA will oppose changing the current law regarding presumptions for injuries or illnesses.



See you next week!