At the conclusion of the recent legislative session, a session that gave birth to Illinois’ business renaissance, a proposal to “reform” Illinois’ worker’s compensation laws failed to gain sufficient support in the General Assembly.
How many jobs have been lost in Illinois during the last 20 years because of our state’s harmful and costly worker’s compensation system? How many families have suffered because of a system designed to foster litigation and delay? How can Illinois truly be ready for the economic challenges of the 21st Century without bringing about meaningful change in this system?
Our members sent us to Springfield with explicit directions to improve the delivery of benefits, bring medical costs down and reorganize the Illinois Industrial Commission. Our members pay the bills, and their employees are helped when injuries occur. Unfortunately, the legislative process allowed those who profit from worker’s compensation to have a larger say in this process than those who pay for and are served by this costly system.
Worker’s compensation costs Illinois business and industry more than $2 billion annually. This is twice what business pays in unemployment insurance taxes and nearly three times the amount collected by corporate income tax. Needless to say, these government-mandated worker’s compensation costs continue to harm Illinois companies’ abilities to compete with neighboring states and nations and push prices up for Illinois consumers.
According to the National Council of Compensation Insurers, a not-for-profit worker’s compensation insurance rating firm, medical costs for treating injured workers (under worker’s compensation) in Illinois are 80 percent higher than the medical costs for treating similar injuries and illnesses that are not work-related. For injuries to the lower back, medical costs are 126 percent more expensive than corresponding group health costs.
Allowing workers to be directed to a managed-care network would help reduce skyrocketing medical costs. Florida implemented a pilot PPO/HMO program where this arrangement averaged 54 percent less in an HMO setting and 28 percent less in a PPO. If Illinois business and industry is to realize the same cost reductions already achieved in their general health plans, reform legislation must include these initiatives. The latest proposal before the General Assembly did not.
Is Illinois truly ready for the challenges of the 21st Century? Will the General Assembly and Gov. Edgar craft a real worker’s compensation reform package–a package that truly checks the skyrocketing costs of worker’s compensation on business? The Illinois Manufacturers Association, the Illinois Chamber of Commerce and the Illinois Retail Merchants Association will continue to push true reform and assist our public officials in crafting real, substantive answers.
