The Wisconsin Legislature's Joint Finance Committee voted Wednesday to pass a portion of Governor Scott Walker’s proposed plan to overhaul the state's worker’s compensation system. In what can best be described as mixed results for all interested parties, the approved portion of Walkers' plan will shift administrative handling of disputed claims to the Department of Administration. Currently they are handled by the Department of Workforce Development (DWD).
Walkers' plans, fully implemented, would have largely moved most workers' compensation functions to other agencies within his administration, including the Office of the Insurance Commissioner. Budget committee members rejected the most dramatic of those moves, however.
As a result of the vote, adjudicative functions will remain at DWD, as will Administrative Law Judges, who mediate disputes in the state. Opponents of the proposals will chalk those up as “wins” for their side.
But this is only half the story.
Wisconsin is not really known as a hotbed of issues when it comes to workers' compensation, and the performance of the states system is held in fairly high regard in many quarters of the country. Professionals in the state point to this success and credit the Workers' Compensation Advisory Council (WCAC), a “quasi-governmental” entity consisting of a cross section of stakeholders from all around Wisconsin. The WCAC has reviewed and recommended ALL workers' comp legislative changes for more than 100 years. Many people there point to the relative stability of their system and credit the balanced approach of the WCAC.
These proposed reforms however, came as part of the budget process, and completely bypassed the council and its members. This has taken many there by surprise, and introduces a new political influence that they are not accustomed to.
Except of course what they see watching their next door neighbors in Illinois beat the crap out of each other during their customary workers' comp reform process.
So, the big story in Wisconsin is not the current reforms they are facing. The big story is the politicization of the process, and the marginalization of an advisory system that has by most accounts worked fairly well all of these many, many years. There is more to this story coming down the pike, and we would be wise to keep our eye on it.
Considering Wisconsin is the birthplace of the Grand Bargain, this doesn't seem like a very smart deal at all.