On June 28, 2011 Governor Pat Quinn signed into law the Workers’ Compensation reform which had been passed by the Illinois legislature in May (House Bill 1698). It has been widely publicized that this reform will save Illinois businesses between $500 and $700 million. There are many components of the reform that will theoretically result in these savings.
One of which is the formation of Preferred Provider Programs (PPPs).
PPPs create provider networks to be utilized for treatment of work-related injuries as a cost-containment method. The use of a PPP gives some control to the employer regarding where the employee seeks treatment. It will also help to ensure that the treatment rendered for work-related injuries is cost-effective with improved outcomes.
The Illinois Insurance Code mandates the following
requirements for all PPPs:
“(1) The provider network shall include an adequate number of occupational and non-occupational providers.
(2) The provider network shall include an adequate number and type of physicians or other providers to treat common injuries experienced by injured workers in the geographic area where the
employees reside.
(3) Medical treatment for injuries shall be readily available at reasonable times to all employees.
(4) Physician compensation shall not be structured in order to achieve the goal of inappropriately reducing, delaying, or denying medical treatment or restricting access to medical treatment.
(5) Before entering into any agreement, a program shall establish terms and conditions that must be met by noninstitutional providers wishing to enter into an agreement with the program.These terms and conditions may not discriminate unreasonably against or among noninstitutional providers.”
The PPP must be in place at the time of the accident. Under the PPP format, an employer will provide a written list of physicians in the program to an injured worker upon notice of the injury. The employer is then responsible for the payment of all medical expenses and referrals from the PPP physician.
If an employer doesn’t utilize a PPP, the injured worker still retains the right to the choice of two physicians (which is the same as the law prior the reform). The injured worker also has the right to decline the program in writing. He/she is then limited to the choice of only one physician.
If an injured worker believes that the medical care provided by the PPP physician has been inadequate or improper, he/she can file a written Petition with the Illinois Workers’ Compensation Commission. Within five days of the hearing, the Commission must render a decision regarding the care. If it is determined that the care has been inadequate or improper, then the injured worker’s choice of physician is reinstated.
While the use of PPPs became effective immediately upon the Governor’s signature, the process for setting up the PPP is still being developed by the Department of Insurance.All PPPs will have to be approved by the Director of Insurance before they can be implemented. As of July 6, 2011 we were advised by the Department that they are still in the process of reviewing the new legislation. Their intent is to provide a checklist applicable to the entities registering but that checklist has not yet been developed. No timeframe for completion has been provided. Horton will continue to monitor the status of this process. Once the process is established, further communication will follow regarding how to proceed with setting up a PPP for your company.