The Missouri Legislature has approved Senate Bill 66, with an effective date of 08/28/2017, which makes some interesting modifications to the Missouri Workers’ Compensation Act. The bill summary is below with our commentary in bold italics. A full copy of the bill is available here. Please feel free to contact us should you have any questions or comments.
This act authorizes, beginning January 1, 2018, a shareholder of an S corporation with at least 40% or more interest in the S corporation to individually elect to reject coverage under the workers’ compensation laws by providing a written notice of the rejection to the S corporation and its insurer. Failure to provide notice to the S corporation shall not be grounds for any shareholder to claim that the rejection is not legally effective. The shareholder may rescind the rejection in writing to the S corporation and its insurer. The rescission shall entitle the shareholder only to the benefits which accrue on or after the date of the notice of rescission is received by the insurance company.
MAXIMUM MEDICAL IMPROVEMENT
Under this act, for the purposes of workers’ compensation laws, the term “maximum medical improvement” is defined as the point at which the injured employee’s medical condition has stabilized and can no longer reasonably improve with additional medical care, within a reasonable degree of medical certainty.
Furthermore, in the case of temporary total and temporary partial disability benefits, such benefits shall only continue until the employee reaches maximum medical improvement unless such benefits are terminated by the employee’s return to work or are otherwise terminated under law. In the case of permanent total disability, compensation shall be paid during the continuance of such disability from the date of maximum medical improvement for the lifetime of the employee at the appropriate weekly rate.
The act modifies provisions relating to compromise settlements under workers’ compensation laws. For all compromise settlements offered after a claimant has reached maximum medical improvement, such claimants have 12 months after receiving an initial permanent disability rating from the employer’s physician to acquire a rating from a second physician of his or her own choosing. Absent extenuating circumstances, if after 12 months the claimant has not acquired a second rating then any compromise settlement entered into shall be based upon the initial rating. Employers may waive these provisions with or without stating a reason. This provision offers employer/insurers additional incentive to request a rating as soon as MMI has been established and, additionally, to extend an offer of settlement based on that rating. Even if rejected at the time of initial offer, if the claimant fails to secure an alternate rating within 12 months, any future settlement is to be based on the initial rating. In combination with the prior offer, this should also have a chilling effect on the claimant’s ability to retain an attorney since the attorney will have no incentive or ability to increase the settlement value where the only issue is the percentage of disability and in excess of 12 months have elapsed since claimant was provided employer’s rating report.
REDUCTION OF WORKERS’ COMPENSATION AWARD BASED ON USE OF DRUGS
Under current law, if an employee fails to obey any rule or policy of an employer relating to the use of alcohol or nonprescribed controlled drugs in the workplace, the compensation or death benefit available under workers’ compensation laws shall be reduced by 50% if the injury was sustained in conjunction with the use of alcohol or nonprescribed controlled drugs.
This act provides that any positive test for a nonprescribed controlled drug or the metabolites of such drug from an employee shall give rise to a rebuttable presumption that the tested nonprescribed controlled drug was in the employee’s system at the time of an accident or injury and that the injury was sustained in conjunction with such drug if:
- The initial testing was administered within 24 hours of the accident or injury;
- Notice was given to the employee of the test results within 14 calendar days of the insurer receiving actual notice of the results;
- The employee was given an opportunity to perform a second test; and
- The initial or any subsequent testing which forms the basis of the presumption was confirmed by mass spectrometry using generally accepted medical or forensic testing procedures.
Under the prior versions of the Missouri Workers Compensation Law, it was often necessary to prove that the injury occurred “in conjunction with” the use of drugs or alcohol. The phrase “In conjunction with” has presented very real evidentiary and proof problems. This provision helps expand the window of time in which the nonprescribed controlled drug or alcohol could have been used and still be construed as being at the time of accident or injury. It creates a presumption of use at the time of accident or injury that will be an evidentiary hurdle for the claimant to overcome, not the employer.
TERMINATION OF DISABILITY PAYMENTS — VOLUNTARY SEPARATION
If an employee voluntarily separates from employment at a time when the employer made work available for the employee which was in compliance with any medical restriction imposed upon the employee as a result of an injury that is the subject of a claim for benefits under workers’ compensation, neither temporary total disability nor temporary partial disability benefits shall be payable to the employee. This provision is self-explanatory but will certainly help reduce exposure for TTD/TPD where the claimant voluntarily separates from employment and accommodated work was, otherwise, available.
HEARINGS FOLLOWING TERMINATION OF WORKERS’ COMPENSATION BENEFITS
Under current law, the Division of Workers’ Compensation is required to set a hearing for any dispute over the termination of workers’ compensation benefits within 60 days of an employee making a request for a hearing. This act requires a hearing to be set within 30 days. This will make it more difficult, from an evidentiary standpoint, to be ready for a hardship hearing since it will shorten the available time for scheduling and taking medical expert depositions. Thus, if it appears that the employee intends to proceed to hardship hearing, employers and their attorneys must be ready to act quickly to develop their evidence for submission to the Judge for consideration.
DEATH BENEFITS AND BURIAL EXPENSES
This act modifies the definition of “dependent” for purposes death benefits and burial expenses available under workers’ compensation laws. The term “dependent” is modified to mean only the claimant’s spouse or the claimant’s natural, posthumous, or adopted child or children, including any stepchild claimable by the deceased on his or her federal tax return at the time of injury, who are under the age of 18 years or over that age but physically or mentally incapacitated from wage earning. The act additionally eliminates partial dependents from the definition of “dependent.” This provision will eliminate all other relatives by blood or marriage from consideration as dependents including, but not limited to, parents of the claimant.
LINE OF DUTY COMPENSATION
Under current law, the estate of a deceased law enforcement officer, emergency medical technician, air ambulance pilot, air ambulance registered professional nurse, or firefighter who is killed in the line of duty is eligible to receive $25,000 in compensation. Under this act, such compensation shall be awarded as follows:
- If there are no children, the surviving spouse shall be awarded the compensation;
- If there is at least one eligible child and a surviving spouse, the child shall receive 50% and the surviving spouse shall receive 50%, provided that if there are multiple children, the children shall receive equal shares of 50% of the compensation;
- If there is no surviving spouse, any eligible surviving children shall receive equal shares of the compensation;
- If there is no surviving spouse or qualified surviving child, compensation shall be awarded to the individual who has been designated by the deceased in the most recent designation of beneficiary that is on file with the public safety organization; provided that if there is no such designation, compensation shall be awarded to the individual designated as beneficiary under the most recently executed life insurance policy of the deceased;
- If there is no beneficiary of a life insurance policy of the deceased, compensation shall be awarded to the surviving parent or parents, in equal shares;
- If there are no surviving parents of the deceased, compensation shall be awarded to the children of the deceased who are over 18 years of age, in equal shares.
The act requires new applicants to specified self-insured trusts to submit proof of payment of 25% of the estimated annual premium to the Division of Workers’ Compensation. Self-insured trusts are further permitted to invest surplus moneys from a prior trust year not needed for current obligations.
DISCHARGE AND DISCRIMINATION
Under current law, no employer or agent shall discharge or in any way discriminate against any employee for exercising any of his or her rights under workers’ compensation statutes. This act modifies that provision so that no employer or agent shall discharge or discriminate against any employee when the exercising of such rights is the motivating factor in the discharge or discrimination. The key language here is a change from “A motivating factor” to “THE motivating factor.” Under this provision, the employee would have to prove that the employer was motivated to terminate SOLELY based on employee’s exercise of rights under workers’ compensation.