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Impairment Ratings Are Not Mandatory

Jay Johnson

As part of the 2011 workers’ compensation reforms, employers pushed through changes to the workers’ compensation laws that they said would bring cost savings to the system.  What many of these changes really were designed to do was to decrease the amount of benefits workers would receive for work related injuries.  One of the changes employers welcomed was the inclusion of impairment ratings to the list of factors a workers’ compensation Arbitrator considers when awarding damages to an injured worker.  However, nowhere was it specifically written in the law that these ratings were mandatory.

Under Illinois law, injured workers are entitled to receive money damages to compensate them for their permanent injuries.  In Illinois, we call this permanent partial disability or PPD.  PPD is a percent loss of use of the injured body part.  PPD is not the same as impairment ratings.

Impairment ratings also give a percent number just like PPD.  However, impairment percentages are almost always substantially lower than PPD percentages.  That is why employers love impairment ratings.  That is why employers want them to be mandatory.  Impairment ratings are calculated by a physician who performs a medical examination after an injured worker has reached maximum medical improvement and then follows guidelines authored by the American Medical Association to arrive at a percentage number.  This process is very formulaic and does not leave much room for an Arbitrator to consider how an injury truly affects an injured person.  Physicians charge money for this exam.

PPD percentages, on the other hand, do consider how an injury truly affects a person.  Prior to 2011, Arbitrators never had to consider impairment ratings.  Since September 1, 2011, the Workers’ Compensation Act says that Arbitrators shall consider five factors when making their determination as to what an injured worker is entitled to receive for his permanent injuries.  These five factors include a person’s age at the time of the accident, the person’s future earning capacity, the occupation of the person, the severity of the person’s injury as corroborated by medical records, and an impairment rating.  The law states that no one factor shall be the sole or primary determinative factor in calculating PPD.

Employers argued that such impairment ratings were now mandatory.  Employers hoped that if impairment ratings were mandatory, employees would be discouraged from filing claims because of the costs associated with an impairment rating and the decreased percent numbers associated with impairment ratings.

First, employers argued that it was an injured employee’s responsibility to get such an impairment rating report.  The Illinois Appellate Court disagreed.  The Appellate Court decided that an employee does not have to submit an impairment rating before an Arbitrator can consider what to award for permanent injuries.  Employers next argued that if an employee did not submit an impairment rating, the court still had to consider an impairment rating from any source.  It was argued that if no impairment rating existed, the workers’ compensation Arbitrator could not make any award to compensate an injured employee for permanent injuries.  Again, the Illinois Appellate Court disagreed.  The Illinois Appellate Court decided that there is no requirement that either party, employee or employer, submit an impairment rating.  If no impairment rating is submitted, the Arbitrator simply has to consider the other four factors.

Both of these decisions are welcome news to employees.  Employees will not be burdened with the cost of obtaining reports that are designed to do nothing more than drive down the value of their claim.  If neither side submits a report, the workers’ compensation Arbitrator is free to consider the other four factors and still award injured workers rightful compensation for their work related injuries.  One question remains… Can employers force employees to submit to an impairment rating exam?  The Illinois Appellate Court has not yet answered that question.  Stay tuned.

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