MINUTES OF THE ASSEMBLY COMMITTEE ON LABOR AND MANAGEMENT Sixty-eighth Session February 16, 1995 The Committee on Labor and Management was called to order at 3:30 p.m., on Thursday, February 16, 1995, Chairmen Saundra Krenzer and Dennis Nolan presiding in Room 4401 of the Grant Sawyer State Office Building, Las Vegas, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Ms. Saundra (Sandi) Krenzer, Chairman Mr. Dennis Nolan, Chairman Mr. David Goldwater, Vice Chairman Mr. Lynn Hettrick, Vice Chairman Mr. Bernie Anderson Mr. Douglas A. Bache Mr. Pete Ernaut Mr. Brian Sandoval COMMITTEE MEMBERS ABSENT: Mr. John C. Carpenter Mr. Mark Manendo GUEST LEGISLATORS PRESENT: None STAFF MEMBERS PRESENT: Mr. Vance A. Hughey, Senior Research Analyst Mr. Fred W. Welden, Chief Deputy Research Director OTHERS PRESENT: Helen Aberle, DIR Danny Thompson, AFL-CIO Jack Jeffrey, Southern Nevada Building and Trades Council Evan Weinper Nancyann Leeder, NAIW Kenneth Waldron Barbara Costello, Dare to Dream Josephine Lynn Darlene Hill Charles Leavold Keith Hill Stella Marchand Danny Williams Wendell Muckenfuss Doug Davidson Dan Richvalsky John Taylor Alan Jackson Larry Wahl, Local 3 Mike De Leo, Local 797 Steven Geye Lincoln Dunbar Larry Salazar Carol Jansson, Dare to Dream Note: The following meeting was tele-conferenced to the Legislative Building, Room 119, Carson City, Nevada. Chairman Nolan welcomed all those who took time to come to the meeting. He explained testimony would be limited to five minutes per person and should address the following areas: date of injury, length of time of injury, self-funded or SIIS insurance, what was mishandled and suggestions on how to correct the problem. Chairman Krenzer also welcomed the audience and stated we are fortunate in Nevada to have a citizen's legislature comprised of ordinary citizens not professional politicians. She disclosed she is a nationally certified rehabilitation counselor and currently an administrator for Sierra Health Services so she may have worked with some of these people in the past. Helen Aberle of the Division of Industrial Relations (DIR) introduced Karlin Dunlop and Bill Overly of Industrial Insurance Regulation Section (IIRS). She began with an overview of who is DIR and IIRS and what do they do for workers. Ms. Aberle stated the mission of DIR is to promote the health and safety of Nevada employees and ensure that injured workers receive all benefits to which they are entitled. The division regulates Nevada's workers' compensation programs to assure compliance with the mandatory coverage provisions required by the Nevada Industrial Insurance Act, enforce health and safety standards required by the Nevada Occupational Safety and Health Act, assist employers in identifying and correcting unsafe working conditions, and inspects and provides safety training for all operating mine properties within the state. (See Exhibit C). She further stated the purpose of IIRS is to conduct compliance audits of insurers, conduct investigations, issue stop work orders and fines, administer the subsequent injury fund and the uninsured employer fund, and provide education and information to insurers, health care providers, third party administrators, employees and employers. She concluded by assuring the committee they would be present during the hearings and would be glad to make any additional presentations needed. Chairman Nolan called forward Mr. Danny Thompson, representative of Nevada AFL-CIO. Mr. Thompson summarized that SIIS underwent major reform last session which resulted in benefit cuts and realignment of rights for injured workers. He declared SIIS is on its way to recovery now, making money not losing it, however we are back again talking about more reform. Mr. Thompson pointed out the AFL-CIO opposes all of the proposals, especially the exclusive remedy and the reduction of the PPD multiplying factor from .54 to .3, which will result in a 40 percent benefit reduction. He stressed whenever a benefit is reduced, the self- insured employer is getting money in his pocket. S.B. 316 netted some $110 million to self-insureds because of benefits not having to be paid, at the same time, small employers are assessed $100 per injury and the top 10 percent is assessed $1,000 per injury. He emphasized AFL-CIO does not support these proposals, it is time to let SIIS alone, let them operate and work the bugs out. Do not make them go through another major reform package again two years later. Assemblyman Anderson asked if Mr. Thompson would remind the committee what the reduction in A.B. 316 meant to PPD. Mr. Thompson responded the reduction from .6 to .54 resulted in a 10 percent reduction in benefit in PPDs, overall 23 percent, if you added up all the changes. Mr. Anderson pointed out a 23 percent reduction would result in an overall reduction of 50 percent in PPD awards over a four year time period. Mr. Thompson stressed how devastating the pre-existing condition provision, which makes people ineligible, was to people. Assemblyman Goldwater requested the definition of exclusive remedy on bad faith. Mr. Thompson replied when workers' compensation came into effect, the worker gave up the right to sue the employer because of an on the job injury and in return, the employer agreed to take whatever came. In effect, a no fault system. If you are injured on the job, your exclusive remedy is to the workers' compensation and not to a legal action against the employer. Chairman Nolan inquired if the employee had the right to civil litigation if in fact the employer was negligent in one form or another. Mr. Thompson deferred to Mr. Jack Jeffrey, representative of Southern Nevada Building and Trades Council. Mr. Jeffrey replied no, there have been bills introduced to remedy that but none have passed. Mr. Thompson interjected one of the proposals is to double the fine if an employee does not use a safety device provided for him. AFL-CIO felt employees are sometimes given jobs that are not quite right. Right now, if an employer purposely removes a safety device, it is only a $300 fine. This proposal would ultimately cause the injured worker 50 percent of his award. Mr. Jeffrey remarked not only 50 percent of the award but 50 percent of the compensation. Assemblyman Ernaut expanded on the exclusive remedy by stating, conversely, it alleviates the ability for the employer to sue the employee if he was negligent. He also maintained there were major reductions in PPDs, true, but they were dealing with a scale of PPD awards that were in the top five in the country. Mr. Jeffrey disagreed. He stressed Nevada pays for the impairment regardless of occupation and ability to return to the occupation and earn a living. He cited an instance where an attorney and a carpenter both lost a thumb. The attorney returns to work, the carpenter cannot because he is not able to hold a hammer. Both receive the same compensation. In most other states, loss of earning power is figured into the PPD award. Nevada had other factors which were taken into consideration in the award, but in 1975 or 1977, the employer and employee decided it would be cheaper for the employer and more beneficial for the injured worker to re-train him and put back to work. The employer saved the money but the worker is not being re-trained. Mr. Ernaut called attention to the fact, in 1993, he agreed with Mr. Jeffrey on the difference between disabled and impaired. But they disagreed on the mean average paid out in PPDs in Nevada, which was substantially higher than any of the neighboring states or similar systems. He agreed there was a problem on re- training in vocational rehabilitation but the crux of the problem was the eligibility requirements. It went from a $5 million line item in 1987 to a $90 million line item in 1991. That huge growth in vocational rehabilitation was not necessarily from problems with re-training, but the eligibility factor. If you were injured, you were automatically eligible. Mr. Jeffrey responded the biggest problem with vocational rehabilitation is not the injured worker, but the management of claims. People have waited for a decision for one year to get into a three month program, all the while getting monthly compensation. Some people have been on voc-rehab for two years and never received any training. Mr. Thompson remarked PPD means permanent disability, that is why they are being compensated. He reiterated if SIIS is reformed the way that proposal would have it reformed, the AFL-CIO feels everything should be thrown out and go to tort and let the attorneys handle it as there will not be anything there for the injured worker. Chairman Nolan called an end to the debate and proceeded with public testimony. He called Evan Weinper to testify. Mr. Weinper, Correctional Officer, was injured on the job August 21, 1994. (See Exhibit D). He testified he was denied timely medical care by his employer and as a result has lost his job, pay and insurance. He cannot return to his former position and there is no light duty available. He has not received any re-training to date. Chairman Krenzer asked if Mr. Weinper sought and received medical treatment and if he was subsequently terminated. Mr. Weinper responded he was not allowed to leave his shift and had to wait till the next day, his day off, to see the doctor. His employer had 30 days to bring him back to work and they refused. Chairman Nolan introduced Nancyann Leeder, Nevada Attorney for Injured Workers. Ms. Leeder stated she did not intend to speak to the committee but would be glad to answer any questions. Chairman Krenzer inquired if Mr. Weinper had access to her services at this point. Ms. Leeder responded he would have to appeal a denial from SIIS for her to be involved. The circumstances are unclear to her as Mr. Weinper said his problem was with the employer not with SIIS. Mr. Weinper stated his claim was never denied by SIIS, it was denied by the employer, who was later fined by OSHA. Chairman Nolan asked Mr. Kenneth Waldron to come forward. Mr. Waldron testified he has been a printer for the same company for the last 12 years. He was diagnosed with carpal tunnel syndrome, a work-related injury, on November 4, 1994. (See Exhibit E). The company has stated it could not have happened there. He has had one hearing in the last four months, been scheduled for another and told the hearing process is likely to go on for several more months before he reaches the appeals level. The doctor has explained to Mr. Waldron this is a simple procedure and he could be back to work within six-ten weeks. As it is now, he stands to lose his home, his utilities are being shut off, his bills are in collection and his disability insurance does not want to pay as they say this is a work-related injury. Mr. Waldron emphasized the system is very long and very discouraging. Chairman Nolan called for Ms. Josephine Lynn to testify. Ms. Barbara Costello of Dare to Dream came forward and stated Ms. Lynn was a member of the Dare to Dream network and was one of several to be testifying. They would be testifying against certain proposals and presenting some proposals to be considered to alleviate some serious burdens on the workers. (See Exhibit F). Ms. Lynn was injured at work on January 22, 1990. She proceeded with a review of her experience with the Nevada Workers' Compensation system.(See Exhibit G). Mr. Ernaut inquired what was her injury and what was her grievance. Ms. Lynn responded her injury was to her upper back but all the treatment was to her lower back. She has spent five years trying to get proper medical treatment. Mr. Ernaut asked if she was receiving compensation. Ms. Lynn responded yes, but to date has not been rated. She stated there are many discrepancies in her file and it is a mess. Mr. Ernaut concluded by asking Ms. Lynn to stay after the meeting for additional discussion. Mr. Anderson asked what caused the injury and if her employer was public or private. Ms. Lynn explained she was lifting mail bags into the car at the post office when the injury occurred. She stated she worked for private industry. Chairman Krenzer questioned if she was still on TTD, was she ever offered light duty and what changes would she suggest to solve the problem. Ms. Lynn noted she was still on TTD, had received compensation for the last five years and was never offered light duty by her employer. She concluded better communication between herself and the claims examiner would have solved a lot of problems. When asked if she ever had a caseworker call her and keep track of her appointments, she responded no. Darlene Hill was the next to testify. She suffered an on the job injury in April, 1993. In July, 1994, she was released back to work with no restrictions and her case closed. Upon further testing, a problem was discovered but she was notified she could not see another doctor until her tests are evaluated in San Francisco. She is working in continued pain and feels the treatment of her case was ineffective. (See Exhibit H). Chairman Nolan asked when and how did the accident occur and was light duty offered. Ms. Hill responded the end of April, 1993, her chair tipped over when the wheel fell off and she is presently back to work on light duty. Chairman Nolan turned the second half of the meeting over to Chairman Krenzer, who called Charles Leavold to testify. Barbara Costello came forward to point out she was personally representing 800 injured workers in the state, some of whom would be here but they were fearful of losing their jobs. Chairman Krenzer asked Ms. Costello what were her credentials and background. Ms. Costello responded she is in the entertainment field, an investigative writer and, right now, a lobbyist. The reason she got involved is her husband. She found herself being drawn into a scenario that she is not too crazy about but cannot ignore. Ms. Costello has no credentials but is not practicing anything but friendship and does not charge for her services. Charles Leavold began his testimony by stating he was injured March 1, 1991. He was injured while on duty driving a bus. Since then he has had various problems with the system, namely, inconsistencies with his money and not getting his medical treatments. He stated on January 10, 1994, after a doctor's evaluation, his benefits were stopped and he was returned to work with no restrictions. At that time, he took the bus physical and failed, yet, they want to put him behind the wheel of a bus with 45 passengers. (See Exhibit I). Ms. Costello asked to speak on Mr. Leavold's behalf as he was so nervous. She testified Mr. Leavold had been released to go back to work with no restrictions and a note was made that he should be investigated for fraud. Mr. Leavold purchased a walker, neck brace and a back brace for himself which his doctor said he needed but the system had not paid for. He had been rated at 9-13 percent by JHC. Another evaluation was scheduled and Mr. Leavold was told to bring in and use all the paraphernalia that he currently had. He called Ms. Costello and asked why they wanted him to wear all this stuff as he did not need it at all times. He uses the walker when he has angina as he is shaky, and the neck brace when his neck hurts. Ms. Costello told him he must comply with the statutes so he did. She believes that constitutes entrapment as a video was made the next day at his home showing him not using the equipment. She assured the committee she has shown up unannounced at his home numerous times and found him utilizing the various braces on some occasions and not on others. She stressed Mr. Leavold was told to utilize something which was used to entrap him. Chairman Krenzer then called on Keith Hill, husband of Darlene from Carson City. Mr. Hill testified his wife has done everything the doctors have asked her to do. She only challenged them when she got into pain management, which seemed to be an effort to get her out of the system. The doctor did not listen when Darlene told him she was still in pain or he would have referred her to another doctor instead of sending her back to work with no restrictions. Mr. Hill feels the patient's care is what is important, if it is not, there is no reason to talk about it. Chairman Krenzer asked if Darlene's pain is thought to be temporary or something she will have to live with. Mr. Hill responded the last doctor that saw her felt it was a tear in a tendon or ligament underneath her rotor cuff and requested the MRI. Mr. Hill concluded his wife repeatedly told the doctors she was not getting better using their treatment. Why did the first doctor not check for other problems before releasing her. Stella Marchand was the next person to testify. She stated she was injured November of 1991 with carpal tunnel syndrome. It took her 10 months to get her first treatment. She feels if she had been treated properly soon enough, she would not be in the position she is today. She referred her packet to the committee. (See Exhibits J and K) Ms. Marchand stated on January, 1993, she was injured from a known and reported hazard, a piece of equipment rolled off a stand and she attempted to catch it. Since 1991 there has been private insurer involvement in her case and she feels this has held it up. She has had two surgeries on each wrist and no idea of what happens next. It is no longer a matter of range of motion, it is a matter of doing repetitive motion without pain. Ms. Marchand concluded she has arthritis and it is a walk in the park compared to carpal tunnel. Chairman Krenzer inquired if her case was currently open and is it a private insurer or SIIS. Ms. Marchand responded she was receiving treatment through SIIS. The private insurer denied responsibility. It has taken 20 months to get medical treatment on her right wrist and 23 months for the treatment on her left wrist. Barbara Costello interjected SIIS was not the insurer of record but they did lose at the appeals level. They are now appealing to the district court. She stated Ms. Marchand has documents that clearly show the self-insurer is responsible and hopefully SIIS will prevail on this one. Ms. Marchand stressed SIIS can work if it is allowed to and encouraged to. Danny Williams began his testimony by stating he was injured in 1989 by falling 10 to 12 feet backwards. A catwalk came loose and fell on top of him, which resulted in extensive injuries. In 1992, a second accident resulted in further aggravation of old injuries and additional new injuries. He has been in vocational rehabilitation for three and one-half years. Mr. Williams has been to five counselors and put together four programs, which have all been turned down. He is now in district court because he feels his constitutional and civil rights have been violated. Mr. Williams had several proposals he wanted to review but because of time constraints Chairman Krenzer asked if he would put them in writing and distribute them to the committee at a later meeting. Mr. Williams agreed. The next testimony was presented by Wendell Muckenfuss, who was injured in 1989. He stated he was not there to talk about his injuries, but the proposed amendments. He feels the laws need to look at the whole picture not just how injuries can be repaired. Financial, mental and social damage have occurred due to delayed rehabilitation and medical care under laws that have been passed. Mr. Muckenfuss asserted the laws passed in 1993 should be reversed and the laws the committee is concerned with now should be modified on behalf of the worker not the employer. Chairman Krenzer asked Mr. Doug Davidson from Carson City to come forward. Mr. Davidson stated he was attending the meeting on behalf of his daughter, Melanie, who suffered a work injury in May of 1994 while moving luggage. Mr. Davidson said Melanie was initially denied treatment by the employer or insurance company, he was not sure which. They went to hearing, which they won. Melanie got one check for time missed and was referred to another doctor who recommended an MRI. A short time later, they were notified all payments and treatment would stop because the employer had appealed the decision. Another doctor's evaluation resulted in Melanie being sent to physical therapy, which was terminated as it caused too much pain. After another doctor and four to six weeks later, Melanie went to the family chiropractor, who gave her some relief. At this time, she still has pain, numbness in her leg and a burning feeling in her ankle and foot. Mr. Davidson stressed he would like to see less of an adversarial relationship. Chairman Nolan asked how long this had gone on, how old she was and if there was ever one specific diagnosis. Mr. Davidson replied this had occurred on May 20, 1994, his daughter was now 19 years old and no specific diagnosis was ever made until the MRI which showed lower back problems. Because of the length of time of injury, the employer's attorney is saying the work injury is okay, the problem she has now is unrelated. Mr. Davidson concluded with a suggestion there be one person to talk to or ask for advice, options or general information. Chairman Krenzer inquired if the company was covered by managed care and if anyone had interceded for them. Mr. Davidson stressed other than the employer's insurance representative no one seemed to be in charge of the case or had its resolution in mind. Mr. Anderson questioned if anyone informed him of a possible ombudsman that is available through SIIS. Mr. Davidson replied no. The next witness called was Dan Richvalsky. Since he was injured June 7, 1986, he has been through four surgeries. He is a state licensed workman's compensation representative. He wanted to discuss three issues: the first being the Jean Hanna Clark center (JHC), which he feels is being wasted by not being used, (See Exhibit L); the second is Nevada Attorney for Injured Workers (NAIW). At this point Chairman Krenzer pointed out Mr. Richvalsky's time was up. Mr. Anderson summarized Mr. Richvalsky's testimony as: JHC was underutilized and NAIW needs the money allocated to them to help injured workers. Mr. Richvalsky agreed. Mr. John Taylor came forward with Mr. Ralph Miller to testify next. Mr. Taylor explained he lost his left eye in 1973 and injured his lower back, which resulted in surgery in 1990 and again in 1993. He pointed out Mr. Miller was originally injured in 1984, had four back surgeries, then was rated disabled the beginning of 1993. He stressed there were 293 amendments is S.B. 316 and not one was positive for the injured worker. He feels that needs to be corrected as the committee is creating legislation that is delaying benefits to the injured worker. He referred to a booklet he put together for the committee (Exhibit M) which outlines his case. On the left side are the statutes which are applicable to permanent total injury and on the right side is a legislative history starting in 1973 on the permanent total statute 616.580. He feels SIIS should return to a fair and honest system as the statutes intended. The next witness was Alan Jackson. He was injured December 29, 1988 when a fellow worker tripped and fell on him. He went to the doctor at the end of the day who said he was okay and sent him home. To make a long story short, during that first year, he saw seven doctors and had six different opinions. After six years, he has had two spinal fusions, two knee surgeries, continual pain and leg numbness. He has been rated at 18 percent but that is being appealed. He stressed doctors need more latitude when treating patients as three to five months go by while waiting for approvals. He had to wait two years for surgery and contends his injuries are greater now than before because of the wait. As several witnesses had been cut short because of time constraints, Mr. Nolan expressed he understood five minutes was not enough time to tell the committee exactly what had happened and to make recommendations. However, the committee is interested in hearing from the injured workers and had scheduled this meeting on their own time to be able to hear their testimony. After a ten minute break, Mr. Nolan reconvened the session asking Mr. Larry Wahl to come forward. Mr. Wahl, a field representative from Local #3 in Las Vegas, wanted to talk about the lack of treatment and remedies to cure the problem. He was speaking for Mr. Monte Loud, who was injured May 17, 1994. On the original accident report, it stated the injury was to head and shoulder. He was sent to a hand doctor, who of course released him back to work. Eight months later they still do not have a doctor that will check for a head or shoulder injury. He has seen two doctors and both have sent him back to work. No one will hire him as he is a tile finisher and needs both hands. Now their managed care provider, FHP, wants to send Monte to San Francisco as that is their closest specialist in their system. Mr. Wahl feels the system needs to be scrapped as workers want to see the closest physician no matter what system they are in. He also feels Jean Hanna Clark is not being utilized well as it is not in some of the managed care providers systems. He concluded by saying Mr. Loud has not received a check in the last six weeks. Mr. Nolan asked why Mr. Loud had not received a check. Mr. Wahl responded Monte had been released to go back to work so SIIS cut off the payments. Mr. Nolan thanked Mr. Wahl and called for the next speaker, Mr. Mike De Leo, President of Local 797 of Las Vegas. Mr. De Leo spoke for Dave Etter, who is not present. Mr. Etter feels very strongly about two subjects; first, the exclusive remedy must be reversed and second, doctors who evaluate for SIIS should not be working for SIIS. Mr. De Leo concluded by asking the committee to protect and take care of the people of the state not big business. Chairman Krenzer pointed out the committee will be looking at the issue, it is not a done deal. Steven Geye opened his testimony by stating his case had just opened in January,1995. He said he really only came to the meeting to see what was going on and has heard nothing but horror stories. The only problems he sees so far are having to check with SIIS before any step is taken and length of time it takes to get tests done. Lincoln Dunbar was next to testify. He stated he was injured September 16, 1994. He was diagnosed with a herniated disc with an impingement on a nerve. He was sent to physical therapy. When the pain worsened, Mr. Dunbar told the claims case manager and his treating physician, but nothing changed. Mr. Dunbar retained an attorney on contingency when his benefits were suspended December, 1994 pending review of medical records of a previous injury in 1987. His attorney cannot find any statute or law stating benefits can be suspended because of a previous injury. Chairman Krenzer inquired if Mr. Dunbar was with self-insured or SIIS and if he spoke with his claims manager regularly. He responded he was insured through SIIS and he did not have regular contact with the claims manager. Mr. Anderson asked if Mr. Dunbar was using NAIW or a private attorney. Mr. Dunbar noted he was not aware of NAIW until after he had retained a private attorney. Chairman Nolan remarked in his experience as claims manager he could never recall having an employee whose benefits were suspended while a previous injury was being investigated. He pointed out there were people at the meeting who could possibly answer any questions he had concerning that issue. Nancyann Leeder, an attorney with NAIW, stated she has seen this situation before when there are two different employers insured by two different entities. Neither entity wants to pay the money so the claimant gets caught in the middle. Mr. Anderson requested information on how many cases may fall into this category and if it was a common problem or rare. Ms. Leeder answered she did not know if it was common, although she knows of five cases, but she would try to retrieve that information from the system. Mr. Anderson emphasized he did not believe that was the intent of S.B. 316. Next to testify before the committee was Larry Salazar, who is on disability through SIIS. His major complaint is the whole system. Mr. Salazar felt if a claimant could go to a committee before an appeal, maybe half the problem could be eliminated. He suggested perhaps the NAIW could talk to the people before the appeals level to determine if their case was valid or not. Carol Jansson of Dare to Dream summarized SIIS as being consistently inconsistent. People have been testifying of money spent, time and money lost and everything comes back to frustration and confusion of dealing with SIIS. Doctors complain about trying to get authorization for treatment, tests and referrals. Claimants cannot get a second opinion unless it is from within the same group because the group will lose money. She emphasized the proposals need to be reviewed. She concluded by saying she will be lobbying against the HMOs and managed care. Chairman Nolan agreed to allow Mr. Salazar 60 additional seconds to finish his presentation. Mr. Salazar wanted to make the point that many claimants spend their own money on doctors and medical care that is not reimbursed by SIIS. Chairman Nolan thanked all who attended the committee meeting and since there was no further testimony adjourned the meeting at 9:05 p.m. RESPECTFULLY SUBMITTED: Susanne Mund, Committee Secretary APPROVED BY: Assemblyman Saundra Krenzer, Chairman Assemblyman Dennis Nolan, Chairman Assembly Committee on Labor and Management February 16, 1995 Page