We aim to keep our members informed about current relevant news and issues, along with legislative and regulatory initiatives that affect workers' compensation and self-insured groups. Check back regularly to read the latest updates.
Legislative updates may be provided by Dusty Fancher and Chris Fisher, Midwest Strategy Group
In September, legislation cracking down on employee misclassification was introduced in the state legislature. The bills are largely viewed as a continuation of increased focus by state officials to crackdown on instances of misclassification. Key provisions of the bills include:
For purposes of defining who can still be an independent contractor, the legislation states that an “independent contractor means an individual who performs work for a payer for remuneration and to whom all of the following apply:
“Payer” would be defined as “a person who pays remuneration to an independent contractor for work the independent contractor provides for the payer.”
Early comments on the legislation from stakeholder groups has been varied. Some employer groups have already objected to one particular provision in the legislation stipulating that anytime an alleged misclassification occurs, the business owner “has the burden of proving, by a preponderance of the evidence,” that they did not misclassify. Labor groups have praised the bill introductions as a way to put an end to “payroll fraud” and protect workers.
The bills have been referred to the House Commerce and Tourism Committee. No hearings have been scheduled on the legislation.
Gov. Gretchen Whitmer announced the appointment of Emily McDonough to the Data Collection Agency Governing Board. The board determines data requirements for establishing workers' disability compensation insurance rates. McDonough is currently the administrator for the Funds Administration and Self-Insured Program Division in the Michigan Department of Licensing and Regulatory Affairs. She was appointed to succeed John Schrock, who resigned May 31, to represent the executive branch of state government for a term expiring Dec. 31. Read more.
Senate Minority Leader Jim Ananich and Senate Democrats are hoping to revise changes made to Michigan’s Workers’ Compensation law in 2011. Senate Bill 368 specifies that an employee must be deemed to have established proof of a good-faith job search if any of the following are met:
An “affirmative duty” to seek employment would not apply under the following circumstances:
Many Democrats are praising the bill as pro-workers. Meanwhile, most Republicans do not want to make changes to the 2011 law. The bill was referred to the Senate Government Operations Committee, which is s chaired by Republican Senate Majority Leader Mike Shirkey. Sources have said the bill is unlikely to be acted upon.
The Health Care Services Advisory Committee has been discussing carrier responsibilities in subcommittee over the last several months. At the center of the issue is the role and responsibility of third-party providers in relation to the explanation of benefits (EOB). The EOB notifies the parties of reimbursement decisions, educates the injured workers on balance billing and outlines the right to appeal payment adjustments.
Noticing an increase in the use of third-party providers, the department deemed it was necessary to adjust the rules to provide for some clarification around the issues. This includes adding definitions of both “network” and “designated agent” to the rule set and outlining the process for notification to interested parties.
Draft rules were released by the department on May 15. The proposed changes would not regulate the networks, but would require that providers disclose any network they are using to the department. Further, carriers would need to supply the agency with a copy of the EOB that is utilized by the network and the carrier, or its designated agent must send an agency-approved EOB form to the provider and the injured worker. In addition, only a provider can alter or change the provider’s original bill.
These changes should assure providers and the injured worker are receiving identical information in a timely fashion, creating clarity with the EOB. The department is expecting the process to be finalized by the end of the year.
– Dusty Fancher, Midwest Strategy Group
Attorney General Dana Nessel and Michigan legislators unveiled measures on April 22 to crack down on companies that misclassify workers to avoid paying full wages, workers’ compensation overtime and taxes.
Nessel is establishing the Payroll Fraud Enforcement Unit within the Department of Attorney General, dedicating resources to receive credible complaints of payroll fraud and misclassification. The unit will investigate claims with the assistance of other departments and agencies, and take appropriate actions available under existing laws.
It is expected that accompanying legislation will soon be introduced to include:
Read article on www.michigan.gov
Gov. Gretchen Whitmer appointed Jerome Hooper, Jr., of Roseville to the Self-Insurers’ Security, Second Injury Fund, Silicosis, Dust Disease, and Logging Industry Compensation Fund Board of Directors. The Board oversees the Funds Administration, which is funded by insurers who write workers' compensation policies in Michigan and employers who self-insure their workers' compensation liability. The board's assessments cover all benefits paid by the Funds Administration and all administrative and litigation costs.
Hooper is the supervisor of health, welfare and occupational health for DTE Energy and a member of the Michigan Self-Insurers’ Association Board of Managers. He is appointed to succeed Barb Pelak, representing employers that have been authorized to act as self-insurers for a term expiring April 30, 2020. His appointment is subject to approval of the Senate.
With the start of the 100th Legislature comes the naming of committee members to the House Insurance Committee and Senate Committee on Insurance and Banking.
Formerly the Chair of the House Insurance Committee, freshman State Sen. Lana Theis (R-Brighton) will now chair the recombined Senate Insurance and Banking Committee. Sen. Dan Lauwers (R-Brockway Township) will serve as Majority Vice Chair of the powerful committee, and Sen. Erika Geiss (D-Taylor) will serve as the Minority Vice Chair.
The committee's regularly scheduled meeting time is Wednesdays at 8:30 a.m. in the Binsfeld Building in Lansing.
In the House, State Rep. Daire Rendon (R-Lake City) will take over as chair of the House Insurance Committee. Rep. Gregory Markkanen (R-Hancock) will serve as the Majority Vice Chair and Rep. Robert Whittenberg (D-Royal Oak) will serve as the Minority Vice Chair.
The House Insurance Committee will meet on Thursdays at 9 a.m. in the Anderson House Office Building.
Gov. Gretchen Whitmer announced appointments and reappointments to the Workers’ Compensation Board of Magistrates. All terms expire Jan. 26, 2023 and the appointments and reappointments are subject to Senate approval.
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