North Dakota’s workers’ compensation agency has begun hiring its own hearing officers to referee benefit disputes, a move critics say could tilt decisions against employees who are injured on the job.
The move shows Workforce Safety and Insurance values “fast, cheap hearings” and has less concern for providing a fair appeals process, an opponent said. A state advisory board plans to review the issue next month.
Jodi Bjornson, WSI’s general counsel, said the new procedure should safeguard injured workers’ rights while giving them faster resolutions of their appeals. Tim Wahlin, an agency staff attorney, said allowing cases to drag on is costly and harmful.
If the agency denies a benefits claim, only to be reversed later, time has been lost monitoring the injured worker’s medical treatment and attempting to find the person alternative employment if necessary, Wahlin said.
“The timeliness (of resolving hearings) is also tying into the ultimate claims expense, and it is simply poor business not to address it,” he said. “The humanitarian side of it is very important, but the numbers are, as well.”
Workforce Safety and Insurance decided to stop using administrative law judges from an independent state agency called the Office of Administrative Hearings on its appeals cases, spokesmen for both agencies say. The change took effect Nov. 1.
Instead, WSI is hiring private attorneys at $120 hourly for work and $60 an hour for travel, with a payment cap of $2,640. Travel is not affected by the cap, and Bjornson may approve exceptions if a case is considered unusually difficult.
Hearing officers who finish their rulings in less than 14 days will get a $300 bonus. Those who take more than 30 days to complete a decision will be docked $20 an hour for all work and travel time spent on the case, the hearing officers’ employment contract says.
State administrative law judges now charge $93.29 hourly for both work and travel time. Travel billings generally are a small portion of the cost, said Allen Hoberg, director of the administrative hearings office.
Hearings in workers compensation disputes are relatively rare. The agency accepts most benefit claims. Those that are rejected are eligible for scrutiny by the Office of Independent Review, which is part of WSI.
If the office affirms a claim’s denial, an injured worker may request a hearing, and a hearing officer is assigned the case. Office of Administrative Hearings data says hearings were held on 126 cases during the 2007 budget year, which ended June 30. During the 2005 budget year, there were 153 hearings; in 2006, there were 136.
During the 2007 budget year, it took an average of 50 days for an administrative law judge to issue a ruling after conducting a benefits hearing, Office of Administrative Hearings data say. The average was 56 days in 2006, and 41 days in 2005.
Workers compensation appeals often are complex, and WSI’s compensation plan for its hearing officers may cause them to rush their decisions, Hoberg said. In three memos about the change, Hoberg argued it is not likely to save WSI money or time, and could result in less fair treatment for injured workers’ appeals.
His office must address “not only WSI’s concerns for fast, cheap hearings, but also to provide an impartial and independent hearing process,” Hoberg wrote.
In one memo, Hoberg said Workforce Safety and Insurance’s “focus is on numbers, because they can be measured.”
“WSI does not recognize other, less measurable items such as due process, perception of claimants about their hearings, and the number of appeals of adverse decisions that do not occur because the claimant understands that there has been a fair hearing before an impartial decision-maker,” he wrote.
The Workforce Safety officials may disagree with an administrative law judge’s conclusions and change them. The injured worker, or his or her employer, then has the option of appealing to state district court.
Steve Little, a Bismarck attorney who represents injured workers, said WSI’s decision to dump the administrative hearings office and use its own lawyers will feed a perception that appeals are rigged against workers.
“The fact is that WSI hiring their own judges is not going to be more efficient. It’s not going to save money. It’s not going to save time,” Little said. “What it is going to do is put the judges under their direct control, and I think that’s going to have an effect on the outcome of the hearings.”
Mark Schneider, a Fargo attorney who represents injured workers, called the change “an incredible power grab, in the midst of all the shenanigans going on at WSI.”
The agency’s board of directors recently fired its chief executive officer, Sandy Blunt. Some agency workers requested protection from retaliation on the job after Blunt, who had been on leave for six months while fighting three felony charges, returned to work after the last of the charges were dismissed.
Recently, an internal auditor suggested board members have meddled in rate decisions on behalf of favored employers.
Bjornson and Wahlin acknowledged concerns about having the agency’s own hearing officers deciding appeals, but said they pressed ahead because of frustrations about the slowness of getting decisions under the current system.
“We don’t need another controversy, let’s face it,” Bjornson said. “However, under the circumstances, I think, with the information in front of you, you have to be willing to make the tough decisions that you think are right, and that’s what we did.”
Wahlin called the change “the least palatable of the options out there. But once the other options dry up, you deal with what you’ve got.”
Schneider and Little are supporting a proposed ballot measure that would require Workforce Safety to use state administrative law judges for hearings, and specify that their rulings may not be changed by WSI.
The agency, if it disliked a ruling, would have to appeal to state district court as an injured worker must do to challenge a decision, Little said. The measure is better known for a separate provision that would give the governor authority to hire and fire Workforce Safety’s director.
Little called the administrative law judges “good, judicious, thoughtful adjudicators.”
“The only bone of contention I have with the current system is the fact that WSI has, and uses, the ability to simply ignore the decisions of those judges, and implement its own decision anyway,” Little said.
WSI e-mails provided by Bjornson showed that Blunt, shortly after he took the chief executive’s job in April 2004, raised questions about the length of administrative appeals.
On average, it was taking 323 days from the time a worker requested a hearing until the time a decision was issued, Blunt said in an October 2004 e-mail. “This is a horridly long process,” Blunt said, calling the average of 323 days “stunningly embarrassing.”
Topics Legislation Workers' Compensation
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