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Workers’ Comp Overhaul Signed, Takes Effect Summer 2014

Tennessee Gov. Bill Haslam has signed the workers’ compensation reform legislation his administration pushed through the state’s General Assembly.

Haslam on Monday put official gubernatorial endorsement to Senate Bill 200, “The Tennessee Workers’ Compensation Reform Act.” The bill swept through both chambers of the General Assembly, largely following a GOP-dominated party-line trek.

The American Insurance Association was quick to issue a press release applauding Haslam after the signing of the bill. “AIA applauds Gov. Haslam for signing SB 200 into law and for his continued leadership throughout the legislative process,” said Ron Jackson, AIA Southeast region vice president. “The Act is the right approach to providing much needed reform to Tennessee’s workers’ compensation system.”

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The new law will make the Volunteer State the 48th to no long adjudicate workers’ comp claims in court. Instead, the law creates a new state agency with the Department of Labor and Workforce Development, whose administrator will be chosen by the governor.

In anticipation of the July 1,2014 effective date, certain portions of the law go into effect immediately, such as those for the adoption of rules and the appointment of personnel to staff the new agency.

Rep. Kevin Brooks presented House Bill 194 to the lower chamber on behalf of House Majority Leader Gerald McCormick, R-Chattanooga, the bill’s prime sponsor.

Brooks predicted that the primary gains for employees will be fewer delays, better medical treatment, claim processes that are easier to follow and support from the workers’ comp division when problems arise. Gains for employers include cost reductions, predictability and more efficient claim handling, said the Bradley County Republican.

Democrats, who fought the bill throughout its movement in the General Assembly, complained that the legislation does not address the medical costs associated with workers’ comp. Opponents claimed that the high cost of health care is the reason Tennessee’s costs continue to rise, while those in the surrounding eight states continue to fall.

Following the House session, where members concurred with the Senate version, before passing 68-24, Democratic Leader Rep. Craig Fitzhugh told TNReport.com “people think it’s going to be reform, but it’s really not.”

“I’m afraid we’ll see it in a year or two and have to do something else with it. I don’t think this is going to turn out to be something very positive,” said the nine-term representative from Ripley.

Majority Leader Mark Norris, R-Collierville, carried the bill in the Senate, where it passed 28-2 with little discussion.

Amelia Morrison Hipps may be reached at amhipps@downhomepolitics.com, on Twitter @DwnHomePolitics or at 615-442-8667.

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Business and Economy NewsTracker

Legislature Approves TN Workers’ Comp Overhaul

Republican Tennessee Gov. Bill Haslam’s workers’ compensation reform legislation passed the state House of Representatives Thursday, 68-24. The bill now heads to his desk to be signed into law.

The House moved to concur with Senate Bill 200, where the bill passed by a vote of 28-2, with little discussion earlier this month. Only one Democrat – Rep. Charles Curtiss of Sparta – broke rank with the House minority party in voting against the legislation that expands the state Department of Labor and Workforce Development to oversee a process formerly handled by the courts.

“This bill is truly an overhaul of the system designed to make fundamental changes to avoid having to do it again in a few years,” said Rep. Kevin Brooks, who presented House Bill 194 to the body. House Majority Leader Gerald McCormick, R-Chattanooga, is the bill’s prime sponsor. In the Senate it was Majority Leader Mark Norris, R-Collierville.

Brooks predicts that the primary gains for employees will be fewer delays, better medical treatment, claim processes that are easier to follow and support from the workers’ comp division when problems arise. Gains for employers include cost reductions, predictability and more efficient claim-handling, said the Bradley County Republican.

Currently, the Volunteer State is one of only three states that adjudicate workers’ comp claims in courts. The legislation does away with the court system — but without any reduction of employees in the state’s 95 Chancery Courts located in each county, Democratic Leader Rep. Craig Fitzhugh noted.

Democrats complained that the legislation does not address the medical costs associated with workers’ comp. Opponents have claimed throughout the bill’s largely party-line trek to passage that the high cost of health care is the reason Tennessee’s costs continue to rise, while those in the surrounding eight states continue to fall.

House Democratic Caucus Chairman Rep. Mike Turner wondered from where the cost-savings in the new system will come. Brooks said “streamlining the process” will result in lower employer insurance premiums.

Turner said he suspects any real savings will come from lower payments to disabled-on-the-job employees. “We’re taking money out of the workers’ pocket. That’s not right. It’s not fair,” said the Old Hickory lawmakers, a firefighter who has served 13 years in the House. “We’re going to pass the savings onto business people. I’ve never seen a bill that tears at my heart like this one does.”

“I hope you understand what you know what you’re doing if you vote for this bill. We’ll be back in three or four years doing this again,” said Turner, urging members to send the legislation to summer study and to “do it right.”

Fitzhugh offered six of the eight amendments from Democrats. However, each one failed, just as they did when he presented them in the Finance, Ways & Means Committee, due to tabling motions to kill each without discussion. In both situations, the tabling motions overwhelming passed along party lines.

Following the House session, Fitzhugh told TNReport.com that he tried to “have amendments that would just put a little more common sense in there.

“The problems I have with it are that people thinks it’s going to be reform, but it’s really not,” said the nine-term representative from Ripley. “I’m afraid we’ll see it in a year or two and have to do something else with it. I don’t think this is going to turn out to be something very positive.”

Following the vote, Mary Mancini, executive director of Tennessee Citizen Action, a union-backed organization that has fought against the legislation, said in a statement that “the House of Representatives has clearly shown that instead of being on the side of protecting the hardworking Tennesseans who elected them, they are on the side of special interests like big insurance companies and large corporations who already benefit from so many tax loopholes and giveaways.”

Amelia Morrison Hipps may be reached at amhipps@downhomepolitics.com, on Twitter @DwnHomePolitics or at 615-442-8667.