Committee weighs S.173 to speed vocational rehabilitation for injured workers

The House Committee on Commerce and Economic Development took up S.173 on March 18, a Senate-originated bill that would eliminate an initial screening step in the workerscompensation vocational rehabilitation process and create a working group to recommend improvements to how Vermont identifies and serves injured workers.

Senator David Weekes, the Senate reporter on the bill, told the committee that about 16,000 Vermonters are injured at work each year and roughly 250 — about 1.5 percent — remain out of work for 90 days or more, the statutory trigger for screening. He described the bills first section as removing an administrative initial screening and referring claimants who request services directly to certified vocational rehabilitation counselors; the second section would convene a working group to study broader reform questions and report back to the Legislature.

"Each year roughly 16,000 Vermonters are injured at work. Of that, roughly 250 workers each year, which is about 1 and a half percent, are out of work for 90 days or more," Weekes said, framing the bill as an effort to reduce delays that can prevent timely access to rehabilitation services.

Why it matters: proponents said the state-conducted initial screening often delays or misroutes cases and that faster access to vocational rehabilitation (VR) can improve outcomes for injured workers and lower long-term costs to employers and the system. Critics including an insurance trade group urged the committee to collect more data first to measure how changes would affect costs and outcomes.

Department of Labor staff told the committee they were generally comfortable with removing the initial screening but asked for clarity on details such as who would chair the working group and on the group's timeline. Under the bill as drafted the director of workers compensation would call the first meeting on or before Aug. 14, 2026 and the study group would submit a report by Dec. 15, 2026; committee members and witnesses noted that schedule is tight and discussed moving the report deadline into 2027.

Workers' advocates pushed for faster access and better counselor standards. Kelly Massaca of the Vermont Association for Justice, a longtime workerscomp attorney, described repeated screening delays in client cases and urged the working group to consider broader reforms including more stringent certification or licensure for VR counselors and mechanisms that would allow claimants or their counsel to initiate referrals when carriers do not act. "There's a lot of waste and inefficiency in this vocational rehabilitation side of the comp system and it needs to be totally overhauled," Massaca said, urging that the working group be allowed to consider additional questions beyond the bill's enumerated list.

Insurersand employers urged caution. A representative of the American Property Casualty Insurance Association said carriers share the goal of returning injured workers to safe employment but asked the committee for data on utilization and cost-effectiveness, noting Vermont's workerscomp premiums remain above the national average despite recent declines. The insurer representative recommended including carrier voices on the study panel so the working group could assess both outcomes and fiscal impacts.

Key details and provisions discussed: - Eliminate the state's initial screening step at 90 days and allow direct referral to certified vocational rehabilitation counselors. - Require the Department of Labor workers' compensation form to notify claimants they retain a future right to request VR services. - Allow injured workers (or their counsel) to initiate VR services if the employer or carrier fails to do so after the 90-day trigger. - Create a working group composed of the director of workers compensation, two claimant representatives, two carrier representatives and two certified VR counselors; the director would call the first meeting and the department would provide administrative support. The bill as drafted sets the first meeting by Aug. 14, 2026, and a report due Dec. 15, 2026; witnesses suggested extending the timeline into 2027 to produce a more thorough analysis.

What was contested: Witnesses disagreed on how widespread the screening problem is and on whether the statescreening should be replaced immediately or tested further. Advocates described repeated case examples in which the screening delayed referrals until a claimant's wage replacement ended, leaving them unable to participate in VR plans. Insurers said they and carriers often take steps before 90 days and urged data collection on costs and outcomes before eliminating the step.

Next steps: Committee members asked state staff and witnesses to provide data on VR utilization, counts of workers who reach the 90-day trigger, and how much VR services contribute to total loss costs. Lawmakers also discussed amending the bill to clarify the working-group chair and to extend the study timeline. The committee recessed briefly and planned further testimony and follow-up work.