MINUTES OF THE

      SENATE COMMITTEE ON COMMERCE AND LABOR

 

      Sixty-seventh Session

      January 21, 1993

 

 

The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 8:00 a.m., on Thursday, January 21, 1993, in Room 227 of the Legislative Building, Carson City, Nevada.  Exhibit A is the Meeting Agenda.  Exhibit B is the Attendance Roster.

 

 

COMMITTEE MEMBERS PRESENT:

 

Senator Randolph J. Townsend, Chairman

Senator Sue Lowden, Vice Chairman

Senator Ann O'Connell

Senator Mike McGinness

Senator Raymond C. Shaffer

Senator Leonard V. Nevin

Senator Lori L. Brown

 

STAFF MEMBERS PRESENT:

 

Denise Pinnock, Committee Secretary

Sheri Asay, Committee Secretary

Brian Davie, Senior Research Analyst

Frarnk Krajewski, Senior Research Analyst

 

OTHERS PRESENT:

 

Jim Wilcher, President Elect, National Association of              Rehabilitation Professionals

Ed Howden, Owner, Ed Howden & Associates

Kathy Sigurdson, Owner, KAS Rehabilitation & Counseling

Carol Jackson, Director, State of Nevada Department of             Industrial Relations (DIR)

Don Jayne, General Manager, State Industrial Insurance System      (SIIS)

Matt Dorangricchia, Assistant General Manager, SIIS

Scott Young, General Counsel, SIIS

John McGlamery, Attorney, DIR

Jack Cook, Owner, Jack P. Cook & Associates

Larry Zimmerman, President, CDS of Nevada

Ray Bacon, Executive Director, Nevada Manufacturers Association

 

 

Chairman Townsend opened the meeting by making sure the committee members had a copy of the draft letter requested by Senator Nevin (Exhibit C).

 

 

      SENATOR NEVIN MOVED TO SEND THE LETTER (REGARDING RUMORS THE STATE OF NEVADA WAS LEAVING THE SIIS) TO THE GOVERNOR.

 

      SENATOR O'CONNELL SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      * * * * *

 

Jim Welcher, President elect, National Association of Rehabilitation Professionals, testified regarding the ability of private sector vocational rehabilitation counselors to provide rehabilitation services for the SIIS.  He spoke of the use of early intervention strategies to save money through shorter temporary total disability (TTD) and rehabilitation time. 

 

Ed Howden, Owner, Ed Howden & Associates, a rehabilitation counseling agency, stated he felt the private sector could augment the SIIS teams.  He said an "either/or" system would not help solve the problems of the current system. 

 

Kathy Sigurdson, Owner, KAS Rehabilitation & Counseling, pointed out the private sector counselors offered timely and aggressive services.  She stated the SIIS counselors currently have an overwhelming caseload which prevents them from working as intensely and aggressively. 

 

Senator Townsend inquired how many rehabilitation counselors the state currently employs.  Don Jayne, General Manager, State Industrial Insurance System (SIIS), explained the current plan would incorporate 28 counselors in southern Nevada, and 15 in northern Nevada. 

 

Senator O'Connell asked what the average length of time for rehabilitation was.  Mr. Jayne said the average is 13.6 months. 

Senator Shaffer stated the committee's intention was to reduce costs instead of merely holding costs.  He asked Mr. Welcher to explain how he would reduce costs.  Mr. Welcher said the private sector could play a larger role in the SIIS instead of hiring more people.  He stated the system is so overburdened the patients are waiting for rehabilitation.  He said the quicker a patient is referred to a counselor the better service they can provide.  At Senator O'Connell's urging, Mr. Welcher discussed the qualifications required for rehabilitation counselors. 

 

Matt Dorangricchia, Assistant General Manager, SIIS, said all the SIIS counselors are qualified.  Most are not certified, but all are eligible.  Ms. Sigurdson clarified that the current laws allow for five uncertified counselors to be supervised by one certified counselor.

 

Senator O'Connell wondered whether there was a problem with doctors being reluctant to release patients to light duty.  Mr. Dorangricchia stated over the past ten years there had been a marked increase in the number of patients being released to light duty.  He said early contact with the employer was very

important.  Securing job descriptions for the doctor to review helped a great deal. 

 

Senator Lowden inquired whether the private sector counselors had competitive prices. Mr. Welcher explained there was a set hourly rate for services and a fee schedule agreed upon by the SIIS.  He said Nevada's rates where averaging lower than the rest of the nation. 

 

Senator Brown asked for a comparison of success rates between the SIIS counselors and the private counselors.  Mr. Dorangricchia stated the SIIS figure for positive outcomes was about 70 percent.  Senator Brown also wanted to know how the fees paid to private counselors compared with the amount paid to counselors in the SIIS.  Mr. Dorangricchia said the SIIS counselors are generally making less money.  Mr. Welcher stated he felt it was difficult to compare dollars for services versus dollars for an employee.  He said the private counselors are typically referred patients who need more services or have failed rehabilitation plans previously. 

 

In answer to a question from Senator McGinness, Mr. Welcher stated his agency's counselors had approximately 55 to 60 percent SIIS patients.

 

Senator Townsend asked what the SIIS counselors do as opposed to the private counselors.  Mr. Dorangricchia said fundamentally they do the same job.  They take a patient with certain restrictions and work with that individual to get the patient back to work in a job that is the most beneficial for the individual.  Mr. Dorangricchia stated the SIIS counselors have about three times the number of cases to deal with, but agreed the most difficult cases go to private counselors because they have the time to deal with them more effectively.

 

Scott Young, General Counsel, SIIS, answered a question from Senator Townsend, stating the Legislature had, during the Sixty-sixth Session, made rehabilitation benefits mandatory.  Senator Townsend stated that action had not been taken by the Senate Committee on Commerce and Labor. 

 

John McGlamery, attorney, DIR, stated not all persons are good candidates for rehabilitation.  He said there are guidelines  and standards for counselors to establish whether a patient would be better off being assisted in job placement. 

 

Mr. Dorangricchia explained when a patient is on TTD they are essentially being paid to rest and heal.  When the patient is on rehabilitation maintenance they are being paid to do something.  He stated it is very important for the individual to start becoming more mobile.  One of the things they are asked to do is see what is available in the labor market. 

 

Senator Nevin asked what incentives there were for the private sector to expedite cases.  Mr. Howden stated, "If you string a case out, you don't get a referral.  It's good business to do good rehabilitation."  At Senator O'Connell's request he explained how rehabilitation counselors use computers to match patients with new jobs.           

 

Senator Shaffer asked what happens when the patient gets angry and does not agree with the counselor.  Mr. Welcher stated the earlier the counselor gets the referral the better, because patients typically experience at least some anger during the rehabilitation process.  He said it is the counselor's job to help the patient work through their anger. 

 

Senator Lowden wanted to make sure a patient who was referred to a private counselor wasn't forced to repeat all the steps the SIIS counselor had put them through.  Mr. Welcher said unfortunately, there are usually many unanswered questions and unresolved issues.  Mr. Howden stated the private counselors did not perform redundant work.

 

There followed general discussion of the advisability of making lump-sum payoffs.

 

Jack Cook, Owner, Jack P. Cook & Associates, a job development firm, testified the key to cost reduction was job development.  He said the SIIS could not perform that function as well as a private organization because they did not have the necessary rapport with private businesses. 

 

Senator O'Connell wondered whether the SIIS should make the decision to make a lump-sum buyout.  Mr. Cook said once all the eligible services had been provided, lump-sum buyout should be a possibility. 

 

Larry Zimmerman, President, CDS of Nevada, a third party administrator, stated a lump-sum buyout precludes the possibility of rehabilitation.  He also said the sole starting factor for driving rehabilitation costs up was the medical community.  Mr. Zimmerman cited the reluctance of the medical community to return a patient to work. 

 

 

Senator Townsend spoke regarding Exhibit D, a memo from Dr. Frank Krajewski, Senior Research Analyst, regarding policy in the state of Colorado.

 

Ray Bacon, Executive Director, Nevada Manufacturer's Association, passed out Exhibit E, a copy of an act from the  Colorado Revised Statutes (CRS).

 

Senator Townsend explained the committee did not know what form the reform would take for reduction of costs, but they were open to suggestion.  He passed out to the committee outlines of Bill Draft Requests (BDR's) 53-65, 53-124, and 53,1157 (Exhibit E) and explained they would be in bill form before the committee went to Las Vegas in February.

 

There being no further business, the meeting was adjourned. 

 

 

 

 

                                    RESPECTFULLY SUBMITTED:

 

 

     

                                                            

                                    Denise Pinnock,

                                    Committee Secretary

 

 

 

APPROVED BY:

 

 

 

 

                                     

Senator Randolph J. Townsend, Chairman

 

 

DATE:                                

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Senate Committee on Commerce and Labor

January 21, 1993

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