WSIA's 2016 Legislative Wrap-Up

April 1, 2016


Spring has sprung, cherry blossoms on the capitol campus have popped, allergies are in the air, and the Washington State Legislature, despite going into an overtime period to complete its work, has finally adjourned for the year this week. Here is our wrap-up of what went down, particularly in the areas of workers' compensation and workplace safety issues.

As we noted in our January preview, this was to be a 60-day legislative session focused primarily on course corrections in the state's two-year operating budget, adopted the previous year, and dealing with vexing issues of public education finance and charter schools. To the extent workplace issues were likely to factor in, much of the attention promised to be about efforts to increase the state's minimum wage and adopt other mandates on employers like paid sick leave, and so on. With closely divided political alignment between Republicans and Democrats in the state House and Senate, anything to pass would have to have bipartisan support.

This prediction turned out more or less correct, with disputes over the method and content of budgeting forcing a two-week "special" session beyond the original mid-March adjournment date, a promise to get serious about education funding next year, drama over the Governor's late-night veto of 27 bills and the eventual override of those vetoes, and not much else happening in any substantive public policy area.

In workers' compensation, at the high water mark of the session, we were tracking 13 different proposals, and four in workplace safety. None of the 17 bills ended up passing the Legislature, although a couple adverse proposals did pass over from the House to the Senate.


Self-insurers entered the session with interest in a performance audit recommendation that the Legislature amend the law to allow self-insured employers to issue their own allowance orders, cutting up to 40 days out of the claims management process while exercising authority over an issue that garners 99 percent Department agreement.

Noting that just issuing allowance orders wasn't much of a development in self-insured claims management authority, WSIA championed a modest proposal to increase administrative efficiency by allowing self-insured employers to issue allowance, interlocutory, and denial orders. Similar to allowance orders, the performance audit showed Department overseers agree with self-insured denial determinations 98 percent of time.

The public hearing over this proposal demonstrated much legislative confusion over the allowance or denial of workers' compensation claims, and an undercurrent by some legislators of suspicion or distrust of private self-insured claims management. As a result, the authority bill was voted out of the Senate Commerce & Labor Committee with an amendment stripping out the denial orders, resulting in WSIA asking the full Senate to set the bill aside entirely until we have the opportunity to educate lawmakers better on how this proposal, and even additional self-insured claims management authority, would improve the system.

Across the rotunda in the House, the politically muscular firefighters' union championed two different bills and saw them both pass over from the House to the Senate. The first, House Bill 2805, would have mandated creation of a database for hazardous exposure reporting for firefighters, following discussions on the topic by a stakeholder working group that met last summer. The only problem was that the proposal went well beyond anything the stakeholder group actually agreed to. Although it passed the House by an 80-17 vote in mid-February, it did not receive a hearing in the Senate.

The more aggressive bill, House Bill 2806, would have expanded the current presumption of occupational disease for firefighters in two ways: first, by adding public fire investigators and emergency medical technician personnel to the presumption, and secondly by substantially increasing the number of conditions covered by the presumption. While the statute providing presumptions of occupational diseases for first responders have traditionally developed after discussions between representatives of police and fire employers and employees about what science supports, there have been no such discussions over the conditions and employments this bill seeks to add. As such, while the bill also passed the House by a large margin, 62-35, it also did not move in the Senate.

Claimants' lawyers also scored a temporary victory in the House with House Bill 2441, an effort to eliminate the offset against time loss the Department takes for recipients of social security benefits for those workers who were already receiving or had applied for social security prior to being injured. This was a scale-back from the bill sponsor's prior efforts to eliminate the social security offset entirely, but when he admitted on the House floor that it was just a first step toward that ultimate goal, opposition rose and it squeaked out of the House on a 53-44 vote. The Senate didn't take it up.

IMEs in the Spotlight

Independent Medical Examinations did pop up as an issue in the session, and one likely to garner future legislative attention. After the self-insurance ombuds described in her report to the Governor last fall a notable incidence of complaints to her office about the frequency and use of IMEs, a legislative hearing was held on the topic. This led to the introduction of a bill to pull together a joint legislative task force to study and report back on any recommended changes to the IME process for both the state fund and self-insurance.

While the IME bill did not travel far in the process, early drafts of the state's supplemental operating budget -- the above-noted one job the Legislature had to do this year -- contained a directive, called a budget proviso, tucked into Labor & Industries' funding sections to convene just such a gathering around IMEs. By the time the final budget passed in the special session, though, that proviso was not included.

Two Budget Provisos Passed

That brings us to the only thing that really did pass in our area this year, two different budget provisos that were included in the final budget agreement.

First, Labor & Industries was appropriated $640,000 to develop a pilot program under which it would partner with one or more outside firms to manage care involving catastrophically injured workers, an issue that has been championed for some time by one such firm, California-based Paradigm Outcomes.

Second, and somewhat more vaguely, the Department was appropriated $738,000 to expand the use of evidence-based best practices to reduce the risk of long-term disabilities among injured workers and report back this December the performance measures and metrics it will use to evaluate whether such activities are actually improving care and outcomes.

Looking Ahead

Looking ahead to next year's Legislative session, it will be the full 105-day session our state constitution provides for in odd-number years. With the Governor, all House members, and half the Senate members up for election or re-election this November, the campus could look a little different -- or not -- next January. Because it was punted this year, school funding and complying with the Washington Supreme Court's McCleary decision on the same will be the major issue.

Because one side of the debate will insist on higher taxes on business to help bridge that school funding gap, expect the other side of the debate to propose business climate reforms to offset any tax increases. When talk turns to improving Washington's business climate, our state's workers' compensation system is always top of mind.

In the interim, WSIA intends to continue work with the Department and other stakeholders on the issues of self-insured authority evoked by the performance audit, as well as issues of wage calculation accuracy and simplification occasioned by the continuing work of the Benefit Accuracy Working Group, which formally wraps up this fall.