Workers’ Comp Fix Signed Into Law

From PA Chamber of Business & Industry

In welcome news for the state’s business community, one of the PA Chamber’s top priorities this session – legislation that will save employers hundreds of millions of dollars a year – was signed by Gov. Tom Wolf last week.

Act 111 of 2018 (formerly H.B. 1840) addresses last year’s financially detrimental state Supreme Court decision in the Protz v. Workers’ Compensation Appeals Board case.  In Protz, the PA Supreme Court removed Impairment Rating Evaluations from the law, which for more than 20 years has provided a structured process for state-designated physicians to determine a patient’s level of impairment and how long wage-loss benefits should be paid. As a result of the ruling, the Pennsylvania Compensation Rating Bureau took the unprecedented action of filing for a mid-year loss cost increase, which industry experts are conservatively estimating is costing employers upwards of $300 million each year.

At the time of the Protz decision, the PA Chamber warned its members that the cost increase would be coming while also advocating for legislation to address the Court’s concerns.  Act 111 updates IRE-related language in the law to address the issues raised by the Supreme Court and requires the PCRB to file a loss cost decrease, which will spare employers from being forced into paying significantly higher insurance costs.

After the governor signed the bill, PA Chamber President Gene Barr issued a statement applauding his action. “This measure will go a long way to reining in future excessive workers’ comp costs related to the Supreme Court’s decision last year,” Barr said.  “We also commend the General Assembly – particularly House Labor and Industry Committee Chair Rob Kauffman and Senate Labor and Industry Committee Chair Kim Ward – for working in quick order to find a legislative solution to address the Court’s concerns.”