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Challenges and Changes in Presumption Legislation Presented October 4, 2016 Mike Rogers President - Colorado Professional Fire Fighters Don Lombardi Chief - West Metro Fire Protection District Joseph DePaepe Senior Vice President – McGriff, Seibels & Williams, Inc. Colorado Special Districts Property, Liability, and WC Pool Administrator Colorado Firefighter Heart and Circulatory Benefits Trust Administrator Overview of Presentation • Relevance of Cancer and Cardiac • Outline Cancer Presumption Status • Call to Action • Heart Incident Solution • Heart Incident Benefits • Heart Incident Structure • How is it Working • Background on Cancer • Background on Cancer Presumption • Issues with Cancer Presumption • Solution for Cancer Presumption • Incident Structure for Cancer Presumption • Concerns • Opportunities Relevance of the Issues • Cancer in the fire service • Cardiac events in the fire service • WC Presumption Legislation CO May 2007 – Not working well – Management committed to being at the table in the future involved in the process Outline Current 2007 Colorado WC Presumption Legislation • • • • C.R.S. § 8-41-209 - Link to Legislation 16,000 firefighters in CO - 1/3 Paid; 2/3 Volunteer Survey 8 years of data on 5,000 firefighters Cancer within five systems: Genitourinary, Digestive, Hematological, Skin, Brain • Annual estimated cost of $6,400,000 statewide • Pure estimated annual claims cost of $400 per FF Call for Action • Cancer presumption pitfalls for firefighters • Heart was on the Professional FF Agenda in 2013 • Management enlists resources for ideas to combat • Listening sessions result in ideas and a give and take partnership Heart Incident Solution • How did this come about • Link to the Heart Legislation - CRS 29-5-302 • Cardiac bill signed by Governor June 5, 2014 • What are the benefits • What is covered • How is it structured Benefits • $4,000 cash award for out-of-pocket expenses upon diagnosis of covered heart or circulatory malfunction other than hypertension or angina • $10,500 cash award where admitted to hospital for less than 48-hours • $50,000 cash award where admitted to hospital for more than 48-hours • $250,000 cash award where totally and permanently disabled • Limited benefits apply for Retraining/Education and Cosmetic Surgery Structure or Heart Trust • Multiple Employer Trust (MET) Used • Legislation specifically enabled Heart Benefit to be formed under MET rules • Public entities in Colorado have a less regulated status under MET • Benefits defined in legislation pulled into CFH Trust Coverage Document www.cfhtrust.com • Administered by McGriff, Seibels & Williams, Inc. • State funded due to objection of CML to an unfunded mandate - labor found funding How is it working • Heart coverage left open to competition and self insurance • 2,881 FF covered in the CFH Trust • 2 other markets have entered the field – neither fully complies with the statute • 5 largest cities self insure • 13 of 15 claims presented in first 2 years of CFH Trust have been paid • CFH Trust makes an initial $4,000 payment within 10 days of completed claim form • To date the pure loss cost is $100 per FF Background Cancer Presumption for Firefighters • Presumptive legislation passed in May 2007 • Previously, cancer as a disease was excluded from WC except where FF could show through a preponderance of evidence that it was work-related • New statute put the burden of the “Preponderance of evidence” on the employer to prove it was not job-related • Employer allowed to investigate and rebut presumption • Exposure not consistently maintained by employer in the past Issues - Cancer Presumption for Firefighters • Investigations take minimum of 30 to 90 days • WC claims filing rules require a determination within 20 days or a Tentative Notice of Denial, subject to investigation, must be issued • FF take the ‘tentative denial’ as a flat out denial and involve attorneys • FF report this as a WC claim and then health carrier refuses to pay leaving employees without either party paying bills or benefits Issues - Cancer Presumption for Firefighters (Continued) • Bills from medical providers stack up • Sick leave and vacation time run out • FF and families are stressed and financially strapped • WC Administrative Law Judges side with FF over the intent of Presumption while employers disagree as rubutability is suppose to be built into the statute • Complicated cases spend 2-3 years in court • FF pass away before indemnity or medical bills are paid and/or compensability decided • Three cases go to the Supreme Court Solution for Cancer Presumption • Look at the successes within the Cardiac Program • Look only to fix what is broken without duplication of other benefits provided elsewhere • Understanding that no funding would be available as it was for the cardiac program which made the chances slim • Management was still eager to close some unintended consequences with cancer statute • Gathered data from the CSD Pool and self-insured cities to do a benefit analysis Solution for Cancer Presumption (Continued) • Benefit analysis showed: – Moderate cost reduction with anticipation of twice as many claims being accepted – Limit the liability of employers to 10-years after employment – Removes cancer from the current inefficient and ineffective WC process • Employers agree to payout same incurred indemnity amounts as paid since 2007 plus 50% of incurred legal to all future claimants as a group • Indemnity and out-of-pocket expenses range from a minimum $4,000 to a maximum cap of $250,000 with potential future increases • 10 Cash Award levels upon diagnosis of one of five (5) types of cancer and five (5) stages within each type • Multiple Employer Trust owned by employers will administer the new Program with representation from the professional FF Solution for Cancer Presumption (Continued) • Employers save 50% of the litigation costs • Employers limit their future liability from FF getting cancer to 10 years after employment • FF get cash award upon diagnosis with no investigation, no directed care, and no litigation • Cash award contemplates the value of what is given up under WC but does not replace it – – – – – Lifetime medications Lifetime medical Permanent Partial Disability awards Spouse dependent benefit Death benefit Incident Structure for Cancer • Incident Based Coverage Form developed to: – Works like an Accident Policy with a cash award to cover a window of deficiencies between an employer’s current medical benefit, retirement, short and long term disability, and post employment medical benefit programs – Avoid WC directed care for FF – Avoid invasive investigation – Avoid time consuming and costly adjudication and litigation Concerns • Many fire operations opt out of Social Security so a plan for post employment healthcare is needed • ObamaCare provides the needed solution but the program’s fate is not certain • Provide appropriate value of the specific cancer healthcare costs into the future Opportunities • Cancer Prevention in the Fire Service • Lung incidents • Can PTSD follow the same course • Can solutions for other emergency responders be included • Can a new era of Labor and Management collaboration be built and sustained Weak Signal • Entities that opt out of Social Security have a variety of plans that may or may not have an equivalent plan for post employment healthcare Questions Thank you! • Mike Rogers, President - Colorado Professional Fire Fighters [email protected] • Don Lombardi, Chief - West Metro Fire Protection District [email protected] • Joe DePaepe, Sr. VP - McGriff, Seibels & Williams, Inc. [email protected]