South Carolina’s workers’ comp agency has more problems than delayed deposits of fines
In South Carolina, an audit has revealed that the state’s workers’ compensation authority has broken state law by not delaying deposits of nearly a quarter-million dollars in fines. In Texas, a report issued by the state auditor’s office has slammed the workers’ comp division for significant inability to “monitor the quality of health care in the workers’ compensation system.”
According to a Nov. 24 piece at Businessweek.com, “The state’s Workers’ Compensation Commission broke state law by not depositing fines as it worried legislators would use the money for something else, according to an audit released Tuesday.
“The commission collected but delayed for weeks depositing $244,000, the Legislative Audit Council [LAC] said in its report.”
Commission tried to protect funds from General Assembly
According to the summary of the council’s report, “The Commission took this action so that, in the event the General Assembly prohibited agencies from keeping their unexpended funds at the end of the fiscal year, the Commission would not have these funds for the General Assembly to take away. We notified management of this violation and the agency ceased the practice and deposited the checks immediately.”
A Nov. 25 video clip of a local news broadcast summarizes the situation about the delayed deposits. The problem is, such summaries may be overlooking deeper issues.
Bigger problems cited
In noting its reaction to LAC’s report, this Nov. 23 post at FitsNews.com says the state’s workers’ comp system has bigger problems that undeposited checks: “Unfortunately, the LAC report ignores the root problem at the agency – outlandish judgments based on arbitrary guidelines that drive premiums up for our state’s small businesses and diminish our ability to compete.
“ ‘We did not examine the amount attorneys may charge claimants in South Carolina as compared to other states,” the report notes. ‘Also, we did not compare the method of determining disability in this state, including the use of American Medical Association impairment ratings, to those in other states.’
“The adoption of AMA guidelines has been a sticking point in the ongoing debate over South Carolina’s workers’ compensation system – a debate that seems to be revisited almost every year because state lawmakers refuse to enact these long-overdue reforms.”
Commission’s response to council’s findings mixed
Although the commission agreed with LAC in its response to the delayed deposits issue–the responses are included in the report–it took exceptions to other issues. For example, LAC says state regulation “67-202.A.(12) defines the Commission’s public affairs (formerly public assistance) division as the division responsible for responding to the general inquiries of employees and employers concerning their rights, benefits, and obligations under the workers’ compensation act. Also, in FY 05-06, the General Assembly specifically funded a new position for an ombudsman.”
LAC says the commission did have one employee assigned to this function, but “as of July 2010, there was no division nor employee whose duties were specifically to act in these capacities” and recommended that the commission appoint an ombudsman/public affairs officer.
‘No specific requirements’
In its response, the commission says, “The regulations contain no specific requirements for the Commission to fund the Public Affairs Division or ombudsman position. Section 42-3-90 of the S. C. Code of Laws establishes three divisions with the Commission’s Administrative Department. The statute does not include a requirement for a Public Affairs Division. In FY 05-06 the General Assembly approved funding for the position of ombudsman however for FY 08-09 and FY 09-10 the General Assembly reduced the Commission’s budget by 30.5%.”
So, after layoffs, the commission says, the executive director assumed the ombudsman duties and the commission remains committed to fulfilling those duties.
Specific problem areas
In all, LAC found problems–and made nine specific recommendations (including the delayed deposits)– pertaining to:
- improving methods of identifying uninsured employers and collecting fines
- improving referral of claimants to vocational rehabilitation
- removing inconsistencies and improving efficiency of the informal conference process.
LAC found no “significant issues” with contested case files.
In its response, the commission deflects the need for adding a compliance officer and says it will review and seek to raise benchmarks for current officers–in other words, get more out of the existing staff, in attempt to collect more fines and bring more employers into compliance.
Regarding the need for increased efficiency and developing a memo of understanding with the vocational rehab agency, the commission agreed and assured LAC that such procedures are underway.
As as far improving consistency among informal conferences, Interim Chairman Beck wrote, “The Commission recognizes the need for consistency in the informal conference process and will develop a training program for claims mediators to address this.”
Commission disagrees with more documentation of facts during informal conferences
However, the commission disagreed with LAC’s recommendations that the informal hearings contain more documentation about “each settlement to ensure that the parties are notified of their rights at informal conferences” and which “information was considered for the proposed settlement.”
The commission agreed with implementing “a checklist” to ensure parties are notified of rights but disagreed about documenting the medical facts of a proposed settlement, reasoning that each case is unique and, besides, if a case escalates beyond the informal hearing, the documentation is required: “The Commission’s role in this process is to ensure any agreement is within the provisions of the statute and regulations. If no agreement is reached, the matter is set for a hearing before the jurisdictional Commissioner. Because each case is individual and unique and the conference is held as an opportunity to reach an agreement between the parties, we see no rational basis for imposing requirements to document justification for the settlement.”
To be continued: The Texas situation.
***********************************************************************************************************************
Frequently enough, a worker’s compensation case may be so complex as to demand legal representation. However, sometimes what seems like a cut-and-dried situation to an injured worker may result in a smaller award than envisioned–or even a denial. Have you, a friend or a loved one been injured on the job? Whether you’re merely seeking answers about your rights or believe a lawsuit may be necessary, be sure to seek counsel with attorneys trained and experienced in workers’ compensation. Here’s some resources:
