TNSIA News

2008 TNSIA Conference - September 11th 2008

We will post details when they become available

By Rose French

The Tennessee Supreme Court has ruled that a worker whose hand was crushed by machinery at his workplace was not to blame for the accident despite his admitted marijuana use off the job.

Billy McIntosh was injured in 2004 while working for Interstate Mechanical Contractors Inc. in Knoxville when his left hand got caught in a power roller machine that bends sheet metal.

McIntosh, who was 51 at the time he was injured, testified that while showing a new employee how to use the machine, he reached over it from behind to set a piece of metal when the new employee engaged the rollers, which then grabbed McIntosh’s hand and pulled it into the rollers.

The co-worker, who was stunned by McIntosh’s screams to “cut it off,” was unable to help so McIntosh was forced to disengage the machine himself and then reverse the rollers to release his hand, the ruling says.

Doctors were forced to partially amputate his middle and index fingers, and McIntosh still cannot extend his ring and small fingers.

At the hospital, McIntosh tested positive for marijuana. He admitted he smoked it in the week leading up to and on the night before his injury but denied smoking it or being impaired the day of the accident.

Interstate Mechanical filed a petition in Chancery Court for Knox County alleging McIntosh violated its drug-free workplace policy and should be denied worker’s compensation — arguing that the drug use impaired his reaction time and was the cause of the injury.

The state law establishing the drug-free workplace program presumes that any injuries to an employee found to have been using drugs or alcohol were caused by the drug use. But the court noted that the law also allows employees to enter evidence to rebut that presumption.

A drug screen on McIntosh’s blood showed THC — the chief mood-altering chemical in marijuana which can be detected in the body up to 30 days after smoking marijuana.

A medical toxicologist testified in a deposition “that the level of THC in McIntosh’s system at the time of the injury would have impaired his reaction time,” the ruling states.

The co-worker and the shop foreman both testified that McIntosh didn’t appear to be impaired by marijuana use before the accident.

McIntosh, who had worked at Interstate for five years, contended the injury was caused by the actions of an inexperienced employee.

The trial court ruled in favor of McIntosh and the state Supreme Court upheld that in a ruling released last week.

“In this case, the undisputed evidence … was that there would be no time to react if a person had a hand next to a roller when it was engaged,” Justice William M. Barker wrote in the Supreme Court ruling.

“The rollers immediately grabbed McIntosh’s hand. McIntosh had no time to react.”

McIntosh’s attorney Gary Dawson told The Knoxville News Sentinel newspaper that he was pleased with the decision: “He’s really suffered and continues to suffer.”

This is a general overview and does not include all workers’ compensation legislation passed by the General Assembly. For a complete, detailed review of this information and all workers’ compensation bills introduced in this legislative session, please go to www.legislature.state.tn.us.

Read General Overview

WC Wage Table

TO TNSIA MEMBERS:

SB1775/HB2128, which was drafted by our organization, was passed by both the Senate and the House last week.  The bill is attached here.  It addresses two problems.  First, there was a recent case that seemed to indicate that an employee could collect temporary total disability and unemployment at the same time.  This bill requires employees to pay back unemployment if they collect workers’ compensation for the same time period.

The second part of the bill makes a simple change to the statute.  The prior statute required the employer/insurer to negotiate in good faith at a Benefit Review Conference, but did not make the same requirement for employees.  This section requires the employee to negotiate in good faith or possibly be assessed a penalty.

The bill is being sent to the Governor for his signature and it is anticipated that he will sign it shortly.

Terry L. Hill, Executive Director
Tennessee Self-Insurers’ Association

Bill attached here

SB1044/HB1081 was defeated in the Senate Committee yesterday and will not be going to the floor of either House. Thanks to all of you for your efforts in halting the advancement of this bill.

Our bill, SB1775/HB2128 was sent to the floor of the Senate and the House, and should be on track for passage next week.

See attached file

SB1775/HB2128 has now been amended to do two things. First of all, it prohibits a person from collecting unemployment and temporary total disability benefits at the same time. If a person collects temporary total, that person has to pay back the unemployment benefits they received.

Secondly, the bill requires an employee to negotiate in good faith at a Benefit Review Conference, and provides for a fine for failure to do so. Prior law provided a fine for an employer who did not negotiate in good faith, but neglected to provide that same penalty for the employee.

Surprisingly, this bill now has gotten out of the House Committee, which means it has a pretty good chance of passing. Please encourage your lobbyists and legislators to push for passage of this bill.

The bill was drafted by the Tennessee Self-Insurers Association.

SB1044/HB1081 would modify the Workers’ Compensation Act to allow a person to collect an unlimited amount of temporary total disability benefits and then to collect an additional 400 weeks of permanency benefits. Present law allows an offset for temporary total disability under these circumstances. In certain circumstances, this bill could be very expensive for an employer and the TNSIA urges you to contact your legislators in opposition to this bill.

Terry L. Hill
Executive Director, TNSIA

All self insured employers should be made aware that Commissioner Flowers adopted the rule to regulate TPAs on November 26, 2005. It’s a fairly comprehensive rule which requires TPAs to do many of the things that insurance companies are required to do (i.e., obtain a certificate of authority, maintain proper books and records, hold monies in a fiduciary capacity, be subject to a state examination, submit TPA contracts for review, etc).

When the rule was first proposed, there was a question about whether the Commissioner had the authority to adopt rules governing TPAs. Commissioner Flowers relied for her authority on 3 different general self-insurance rulemaking statutes, all of which were ambiguous about TPAs that provide service for self-insured employers. At the time, there were those who expressed concern about whether Commissioner Flowers had the authority to adopt the rules regulating TPAs. In any event, the rules in their final form applied to TPAs acting on behalf of either a self-insured group or a self-insured employer. These rules were sent to the Attorney General, and the Attorney General reviewed and approved the rules for legality. Thus, the state’s lawyer (the Attorney General) reviewed the rules and gave an indication to Commissioner Flowers that she did have the authority to adopt the rules. This does not appear to have been challenged by any court to clarify whether the rules are valid or invalid. The Tennessee State House and Senate committees responsible for reviewing rules also permitted these TPA rules to go into effect.

Any TN self-insured employer ought to be utilizing the services of a TPA that is duly licensed by the Department of Commerce and Insurance. IT IS OUR UNDERSTANDING THAT A NUMBER OF TPAs, CURRENTLY OPERATING IN TN, ARE NOT PROPERLY LICENSED. A SELF-INSURED EMPLOYER USING THE SERVICES OF AN UNLICENSED TPA COULD BE SUBJECT TO AN AUDIT FINDING FROM THE DEPARTMENT OF COMMERCE AND INSURANCE. WE RECOMMEND YOU CONTACT YOUR TPA TO VERIFY THEY ARE LICENSED IN TN.

To: TERRY HILL, TNSIA

Terry, I only recently became aware that the TNSIA had formed. As Commissioner of Commerce and Insurance, I dealt with many statutory, regulatory, and policy questions related to self-insurers, both individual and groups. I don’t know if you are also aware that the National Association of Insurance Commissioners also has various committees who draft model laws and regulations relating to self-insured risk, including third party administrators, loss reimbursement policies (”high deductible” policies), and general worker’s compensation matters. I recently made a presentation to fourteen self-insured trusts across the nation concerning the regulatory and legal implications of impaired self-insured groups.

I think the formation of the TNSIA is a great thing. As Commissioner I struggled to get input on self-insured matters because individual self-insured employers had no collective voice. Let me know if there is anything I can do to assist the TNSIA from a regulatory or legislative standpoint.

Paula A. Flowers, Esq.
Farmer & Luna, PLLC

The Tennessee Self-Insurers’ Association has prepared several bills for introduction in the Legislature on issues of importance to stakeholders of our organization. We are working with the Tennessee Chamber of Commerce & Industry to try and get these bills passed.

Please note House Bill 2129, sponsored by Rep. Fitzhugh, which is also Senate Bill 1797, sponsored by Sen. Southerland, is a bill that we are pushing hard. The bill is in two parts.

• Part I of the bill allows employers and employees to agree to cut off future medical if they can get the Department of Labor or the court to agree to allow them to do that. Under the 2004 Reform Act, closing medicals is basically prohibited.

• Part II of the bill attempts to define a repetitive injury and puts the burden on the employee to prove by clear and convincing evidence that an injury is due to a repetitive motion. It also defines a repetitive injury to mean an injury “directly and solely caused by repetitive use of the affected body part, as established by competent ergonomic and medical evidence, and which is not the result or natural consequence of the aging process or a congenital or developmental disorder.”

Please contact your senator and representative and enlist any lobbyist that you might employ to help us push this bill through the Legislature.

Attached are pdf copies of House Bill 2129 and Senate Bill 1797. To monitor their progress visit http://www.legislature.state.tn.us/.

House Bill 2129 pdf
Senate Bill 1797 pdf

Commissioner Leslie A. Newman was appointed by Governor Phil Bredesen to lead the Tennessee Department of Commerce and Insurance, which performs a variety of regulatory functions and also houses the state fire marshal’s office and consumer affairs.

A native of Dallas, Texas, Commissioner Newman has more than 20 years of experience in both public and private practice. She received a Bachelor of Arts degree from Johns Hopkins University in 1976, her Juris Doctor degree in 1979 from the Washington University School of Law in St. Louis, Missouri and a masters of Law in Urban Law from the Washington University School of Law in
1980.

From 1990 to 1994, she was an attorney with the Municipal Technical Advisory
Service (MTAS) of the University of Tennessee, Institute for Public Service,
providing legal assistance to municipal governments across the State as part of an inter-disciplinary consulting team, subsequently serving with the Metropolitan
Nashville Department of Law from 1994 to 2000. Her private practice since 2000
has included a focus on land use, zoning, urban and municipal law, and
governmental relations.

From 1994 to 2000, she served with the Metropolitan Nashville Department of Law as Associate Metropolitan Attorney. As the Associate Metropolitan Attorney, she advised the Office of the Mayor, the metropolitan council and various additional departments, boards, and commissions of Metro Government and was responsible for supervising the Metro Law Department’s approximately 25-attorney staff. From mid-2000 until early-2003, she chaired the Land Use and Zoning and the State and Local Government subgroups as a member of the Nashville law firm of Waller Lansden Dortch & Davis, PLLC.

Numerous publications to which she has contributed include: A Look at the
Americans with Disabilities Act - A Local Government Official’s Guide (MTAS 1992); D. Mandelker & R. Montgomery, Housing in America: Problems and Perspectives (1979); Solar Access Law: Protecting Access to Solar Energy Systems (Team Four, Inc., Planning Design & Development Consultants 1979); American Planning Association Newsletter.   Ms. Newman served as President of the Tennessee Municipal Attorneys Association from 1998 to 1999. She is a member of the Nashville and Tennessee Bar Associations. In March 2004, Ms. Newman was appointed by Governor Phil Bredesen to the Tennessee Advisory Commission on Intergovernmental Relations (TACIR). In addition, she currently serves as President of the Friends of the Library for Nashville and also is a board member of Nashville State Community College Foundation.