Missouri committee hears split testimony on House Bill 497 to change workers’ compensation rules

Rep. Chris, sponsor of House Bill 497, told the Missouri House Committee on Insurance the bill aims to reform the state’s workers’ compensation system to “bring clarity and fairness to the process for both employees and employers.”

The bill would, in Rep. Chris’s description, clarify what counts as a compensable work accident versus a preexisting condition; adjust how insurance savings are considered when awarding compensation; create an early motion-to-dismiss pathway for claims that are “fundamentally deficient”; and allow appeals of temporary awards to remove a penalty that can require employers to pay doubled damages for certain temporary decisions.

Supporters, including attorneys and industry groups, told the committee the bill would curb what they called misuse of the system and reduce long, expensive litigation. Matt Murphy, an attorney from Columbia testifying for the Auto Dealers Association, said House Bill 497 would restore what he called “the bargain” of workers’ compensation: medical care and wage replacement for work injuries, not coverage of longstanding degenerative conditions. Murphy said the bill would prevent scenarios in which an employer ends up funding a full knee replacement that he argued stems from prior degeneration rather than the work incident. “That’s not what the comp system is for,” Murphy said.

Industry coalition witnesses — including Hampton Williams of the Missouri Insurance Coalition, Rich Albichon of the American Property Casualty Insurance Association and representatives of pooled public insurers such as MRMA and the MAC trust — said the bill would reduce costs for pools and counties and clarify liability when employees have other sources of medical payment.

Opponents, principally attorneys who represent injured workers, warned the changes would shift costs and delay care. Springfield attorney Randy Alberhasky said the bill “creates far more problems than it solves,” arguing the proposed ‘‘prevailing factor’’ standard would make nearly every claim contested because most adults have some preexisting condition. Alberhasky said existing law already gives employers credit for payments by health insurers and federal programs, and he warned the bill could leave injured people without representation by eliminating or reducing contingency fees on some recoveries. "If I have a case where there's no permissibility . . . I'm not gonna take a case. I can't afford to take a case if I can't get a fee," Alberhasky told the committee.

Opposing witnesses also flagged drafting problems the committee might need to fix. Alberhasky said a provision as written could deny death benefits where a decedent never received medical treatment for a traumatic fatal injury, calling that “an egregious, terrible drafting error.” St. Louis attorney Mike Schlitter warned the bill would prompt more circuit-court litigation and undermine the administrative bargain that sends workplace injury claims through the workers’ compensation system rather than the civil courts.

Committee members asked about a fiscal note the Department of Labor prepared; Rep. Chris and witnesses described the fiscal note as a conservative, worst-case estimate and said the bill’s proposed dismissal process would often be handled on short, administrative dockets rather than lengthy evidentiary trials. Local-government witnesses said system clarity and limits on long-running, easily dismissed cases would save municipal pools money. Steve Hobbs of the Missouri Association of Counties said the MAC trust insures more than 90 counties and about 13,000 lives and that annual workers’ compensation payouts for the trust are about $12,000,000.

The committee heard multiple supporters and opponents in succession; members did not take formal action on the bill during the hearing. The sponsor and witnesses said they are available to work with the committee on drafting fixes and clarifications.

The hearing closed without a vote and moved on to other bills on the agenda.