On May 30, the Illinois House passed legislation on a unanimous vote to outsource the state’s workers’ compensation system. The bill, HB 2958, would require the Department of Central Management Services (CMS) to contract with private companies for management of state workers’ compensation claims.
Barbara Flynn Currie, the House Majority Leader, said that the bill was in response to a the recent audit of the workers’ compensation system. House Speaker Michael Madigan had requested the legislation. Madigan called for privatization of the system even before the critical audit was released, saying that his own staff had studied the issue and found a substantial gap between the rate of claims by state workers and those by workers in the private sector.
The audit, by Auditor General William Holland, said that the system pays claims by injured state workers too readily, sometimes without proper medical evidence, and occasionally even making payments that the injured worker did not request. Holland’s report found that claims adjusters were overworked, and that arbitrators lacked guidelines for deciding cases, resulting in widely varying awards to different workers for the same injuries.
The proposed law is opposed by the American Federation of State, County and Municipal Employees (AFSCME), which represents many state workers. The union said that CMS already has the ability to outsource the administration of workers’ compensation, and the mandate that would be created by the proposed law is unnecessary.
The legislation will now go to the Illinois Senate.