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MONTANA SELF INSURERS' ASSOCIATION

UPDATE Legislative Week 3

See attached spreadsheet for links to the available language.

  • Medicaid Expansion, Property Taxes & The Senate Intrigue
  • HB 143 – PAs as Treating Physician – pass Committee
  • SB 109 – PTs as Treating Physician – Heard in Committee
  • HB 197 – “Rainey” Bill – Heard in Committee
  • SB 202/LC 2784 – Guardian ad Litem
  • LC 1836 – Eliminate the SAWW Cap for All Indemnity Benefits

This week in Helena it was Medicaid and Property Taxes and more Senate intrigue. Both topics are major issues for this session and both have split the majority caucuses.

Medicaid expansion is likely more important for our business. This is not an expansion as such, but a continuation of Montana’s participation in the federal government subsidy for low earners to be eligible for Medicaid coverage. Currently some 80,000 Montanans are covered under this proposal which was first enacted in 2015, renewed in 2019 and is set for sunset June 30 this year. This is the number one priority issue for the Montana Chamber of Commerce and most, if not all other business organizations I am aware of.

Either Montana continues to participate in the federal program, terminates our participation or somehow changes the program. As it sits, the federal government pays 90% of the costs for coverage, with the state kicking the remaining 10% - and if the federal subsidy went away, so would the state’s responsibility. Both the Democratic sponsored bill and the Republican sponsored bill were heard this week – with no opponents. As well, the Senate Leadership bill which would terminate Montana’s participation was heard as well – with no proponents other than the sponsor and 14 opponents testifying.

The law provides significant support for rural health care and hospitals and without it, some are projected to close and the larger hospital systems will increase prices, reduce services and reduce staff. This is a function of the federal law which requires hospitals to treat all patients, whether they can pay or not. The inability to collect fees from Medicaid, will put rural health care in further jeopardy.

There are plenty of academic studies which demonstrate when more people have access to health care coverage, workers’ compensation claims, and costs, go down. When they do not have access to that coverage, those injuries and illnesses that might be comp, and might not be comp, somehow wind up being covered by comp. MSIA supports the continuation of Montana engagement in the Medicaid Expansion program and supported the Montana Chamber of Commerce testimony.

Property taxes were also on the agenda this week. The Senate leadership bill, the Governors’ bill and the Democratic bill to address property taxes were heard this week. The Senate leadership bill would take bed taxes, largely end tourism advertising and dedicate $100m to property tax relief is estimated to decrease property taxes an average of $450 per year.

The Governor’s bill would reduce the tax rate on owner occupied and long term rental properties, increase the tax rate on 2nd homes, short term rental properties and properties valued over $1.3 million, decrease the rate on the first $2 million in value of commercial properties and increase the rate on values above that limit. This proposal is estimated to reduce the tax burden on primary residences 15 – 17%. However, there is a clear shift to 2nd homes (the cabin at the lake?) and higher valued commercial properties.

The Democrats proposal would provide an exemption for the first $50,000 and lower the tax rate on values up to $500,000 above that. There would then be a graduated rate increasing as the value of the property increases. For commercial property they propose an exemption for the first $200,000 in value and no change in commercial property rates above that. The Democrats also have a proposal to provide a property tax credit based on income tax. We do not expect the Democratic proposals to get too far – and if there is serious interest, the proposal will be amended into a Republican bill.

Finally – there remains the threat of a California Prop 13 type of ballot initiative which would limit local taxes to a 2% increase per year. While attractive at first glance, it will have a significant impact on funding any local programs, police, fire, streets, schools and everything else.

The Senate leadership issues continue. The conservative Senate leadership continues to struggle to keep the majority together. On the first day of session, nine Republican Senators teamed up with the Democratic minority to throw out some of the previously agreed majority rules. The leader of “the Nine,” Senator Jason Ellsworth (R-Hamilton) who was Senate President last session and was not re-elected to leadership this session, had provided a no-bid contract to one of his business associates, in the waning days of his role as President. That came to light early this week and an ethics complaint was filed and an investigation will likely occur. Senator Ellsworth immediately walked away from the contract, without any funds being spent, and no work being done. However, the ethics probe will continue.

There continues to be what seems like a lower-than-normal number of Senate bills assigned to committees. For now, the Senate dysfunction is not impacting too much work, but it soon may.

This week also saw some action on WC bills. We also have some new language on proposals we have identified.

One proposal, which we saw last session is LC 1836 from Representative Harvey (D-Butte). This proposal would eliminate the cap on the State Average Weekly Wage for indemnity benefits. The result would be an increase – potentially a significant increase in benefits as they would be based on the individual’s average weekly wage. NCCI has been notified of this language and has been asked to put a price tag on it. MSIA opposes this proposal.

HB 143, to permit PAs to be treating physicians passed the House Business & Labor Committee 20 – 0. MSIA supports this proposal. The Committee vote can be read as an indication of how it will fare on the House floor.

SB 109, to permit PTs to be treating physicians was heard in the Senate Business & Labor Committee today, 1/24 and seemed to get a favorable response from the Committee. MSIA was the lead opponent to this proposal. 

HB 197, to overturn the Rainey decision requiring job analyses and administrative paperwork when there is a full duty release was also heard in the House Business & Labor Committee on 1/22. MSIA supports this bill to address an administrative burden which only adds costs to the system. The bill is expected to pass the Committee next week.

SB 202 was introduced this week. It provides the WC Court Judge authority to appoint and terminate a Guardian ad Litem. MSIA supports this bill.

Here’s a rundown of action this week, bills we are interested in and Committee action expected next week (Language that has been introduced has an HB or SB number assigned. A change requested by a legislator is assigned a Legislative Counsel number. Only when the requesting legislator permits it, is that language available. LC bills are still in draft and can change prior to introduction.)

 

HB 143 / Etchart / R-BIL

See discussion above. Hearing held 1/17 with only the plaintiff attorneys opposed. Business, PAs, Primary Care providers, insurers and AFL/CIO-MFT supported the bill. The bill passed the Committee 20 – 0 and was reported to the House floor. MSIA supports this bill.

 

HB 197 / Nicastro / R-BIL

This bill addresses the “Rainey” Workers Compensation Court decision (Nat'l Union-Rainey_2021MTWCC10.pdf) where the judge determined that even with a full duty release, the insurer had to go through a job analysis and 14 day notice before terminating TTD benefits. This bill was heard in House Bus & Labor Committee on 1/22. MSIA testified in support of this bill.

 

SB 109 / Hertz / R-Polson

This bill would allow Physical Therapists to be Treating Physicians. PTs have alleged that about 12 other states allow for ‘Direct Access’ to PTs for workers’ compensation claims. That may be, but the requirements for a ‘Treating Physician’ in the Montana WC system require them to make a diagnosis, be the gatekeeper for treatment – referring to other specialists as needed, provide the release to return to work, determine maximum medical improvement and provide impairment ratings – few of which a licensed PT in Montana can do. This proposal takes access to health care providers too far. This bill was heard in Senate Bus, Labor & Economic Affairs Committee on today,1/24. MSIA was the lead opponent testifying on this bill. Importantly MSF was an informational witness – neither supporting nor opposing the bill, which seemed to carry some weight with the Committee members.

                           

LC 2784 / L. Smith / D-HLN

This bill provides the WC Court Judge with the authority to appoint, or terminate an Guardian ad Litem. The new WC Court Judge was asked to appoint a new Guardian ad Litem and he ruled he could not, as the statutory language does not provide him that ability. Although this has been done for the 100 years or so of the WC system in Montana, the statutory language to support it was not there. MSIA supports this bill.

 

LC 458 / J. Kassmier / R-Ft Benton      

This bill is the Department of Labor ‘clean up’ bill. It provides a clarification of “employer” in a borrowed employee situation, provides for annual instead of quarterly reporting of losses for Administrative Fund assessments and changes the medical status form so that only one form would be needed, rather than two with the second providing medical information not permitted to be shared with the insurer. MSIA supports this bill.   


LC 660 / A. Olsen / D-MSO

This bill would change the choice of physician back to the employee choice, versus the current employer choice (see discussion above). While language has not yet been released, and it exists in title form only, MSIA expects to oppose this bill.   

 

LC 1353 / Buttrey / R-GTF

This is an MSIA bill to limit coverage when an employer provides or pays for vehicle use. The goal is to limit exposure to when an employee is in course and scope of work, rather than anytime they are in an employers vehicle furnished or paid for by the employer. Language is expected to be available within the week.

 

LC 1564 / Reavis / D-BIL

This bill provides for PTSD claim opportunities for law enforcement and first responders. Rather than provide a presumption, the language requires claims to go through the WC process for compensability determination. However, it provides a carve out from the existing prohibition on ‘mental-mental’ claims. In so doing, it likely creates an equal protection violation of constitutional language. That argument, which will be made, could lead to a proposal that everyone have access to mental-mental claim benefits. There are only about 12 states which continue to exclude mental-mental claims in their WC systems. And, the trend across the country has been to provide presumptive coverage for first responders. MSIA opposes this bill.


LC 1836 / Harvey / D-Butte

This bill eliminates the benefit cap based on State Average Weekly Wage, which will have a significant impact on benefits for higher wage earners. NCCI has been notified of the language and has been asked to estimate the cost impact to the system. MSIA opposes this proposal.