Senate Bill 135, passed by the Georgia Senate on March 5, 2019 and by the Georgia House of Representatives on March 28, 2019, has been sent to Georgia Governor Brian Kemp for signature. The Bill passed without a single legislator voting against it, and is expected to be signed into Georgia law.
The effect of the bill on the Georgia Workers’ Compensation system is profound. First, it amends O.C.G.A. § 34-9-200, relating to medical treatment required to be provided by Employers in compensable claims. Previously, the Legislature established a 400 week cap on medical benefits for injuries occurring after July 1, 2013. Senate Bill 135 carves out an exception to that 400 week cap for durable medical equipment.
Senate Bill 135 allows for maintenance, repair, revision, replacement or removal of prosthetic devices that were implanted during the initial 400 weeks post-injury. This exception also applies to spinal cord stimulators, eyeglasses, hearing aids, orthotics, and durable medical equipment such as wheelchairs, canes and beds.
Prior to Senate Bill 135, an employer could provide a device such as a spinal cord stimulator that could have an expected usefulness timeline exceeding 400 weeks post-injury. In that situation, it would be up to the Employee to remove or replace the spinal cord stimulator. Now, the employer is responsible for payment for the upkeep of such devices.
This revision in the law goes against the spirit and intent of the original amendment of O.C.G.A. § 34-9-200 when the 400 week cap was established. Georgia, in an effort to attract businesses and reign in spiraling medical costs, provided certainty for a fixed-cost of medical exposure in workers’ compensation claims. Employers were able to obtain a medical cost projection that detailed all likely medical exposure in the 400 weeks following an employee’s injury. This led to more settlements and closure of files.
The revision to the law takes away this certainty and ushers back in an era of uncertain medical costs for employers in Georgia. Employers no longer have a good idea of how much medical treatment will cost in a claim, making it more difficult to settle. Imagine a 60 year old Claimant in poor health who receives a spinal cord stimulator. Under the old law, the employer knew for sure what their likely medical cost would be. Under the new law, the employer does not know whether the employee will outlive the spinal cord stimulator, making it difficult to project future medical treatment and get a fair settlement value for all sides. Employees will be cautious to settle claims without this potential exposure, and employers have no reason to assume that the potential exposure will actually materialize; making it more likely that Georgia will see a downturn in settled cases and more uncertainty across the system.
This also provides a disincentive to businesses considering Georgia for opening or expanding business opportunities within the state. If Georgia is going to be a pro-business state, it needs to have the pro-business mindset that brought economic growth during the last administration.
The State of Georgia prides itself on leading the country as a business friendly environment. On November 2, 2015, Governor Nathan Deal announced that Georgia has been named the number one state in the nation in which to do business for the third consecutive year. Governor Deal specifically noted that, “[t]his ranking is not only a testament to our strong business climate, but it also speaks to the commitment and support from our industry partners, communities, and the people of Georgia.” Senate Bill 135 is a step in the wrong direction from this policy.
Senate Bill 135 also raises indemnity rates for injuries under the Workers’ Compensation system. The maximum TTD rate is raised to $675.00 per week (a 17% increase) and the TPD rate was raised to $450.00 per week (also a 17% increase). The surviving spouse benefit cap found in O.C.G.A. § 34-9-265 also was raised to $270,000.00.
This 17% raise in maximum indemnity benefits is in contrast to the 2015 amendment, which was a 4.7% raise in indemnity maximum benefits. This kind of raise in benefits shows unpredictable costs for Employers, again in contrast to the goals of the pro-business climate of Georgia.
Given this kind of legislation, it is important for Employers and Insurers to be aggressive in their defense of Georgia workers’ compensation claims and not accept claims with medical and indemnity exposure without a thorough investigation, analysis and possible defense.