Commission moving to Main Street

The South Carolina Workers’ Compensation Commission will move to 1333 Main Street (5th floor) towards the end of May 2009. The move is tentatively planned for May 28 & 29.

“We are working through the logistics of the move,” says Gary Cannon, executive director at the Commission. “We may be closed for business for a short period of time during the actual move, but the telephone system won’t be offline at all. Also, all telephone numbers and email addresses will remain the same,” he adds.

The agency will occupy less office space in its new location – about 28,000 square feet versus the 32,000 square feet it now occupies – but all employees would be on one floor and the hearing room will be larger, Mr. Cannon says. Parking will be a little different at the new location.Spaces will be available behind the building, however visitors will have to pass through a security gate and expected to park only in designated spaces.

“We have been assured adequate number of spaces in the surface lot, and any overflow can be accommodated in the nearby parking garage,” Mr. Cannon says.  The move to the new location is expected to save the agency over $587,000 over seven years.

Even small savings would be a big blessing at the financially strapped Commission. Like almost all state agencies, the Commission has endured budget cuts since the start of the current fiscal year on July 1, 2008. The 21.2% cut in the budget means the agency is unable to fill five open positions. On the bright side, that has enabled the Commission to avoid laying off or terminating employees.

“We think we will be okay if we don’t have to face any more cuts.  And we do expect to see additional revenue from the recent increase in fines and penalties,” Mr. Cannon says. The agency anticipates raising approximately $800,000 from the new penalties that went into effect April 1, 2009.

Fines for late filings have increased from $100 to $200 per occurrence, while the fine for carriers that fail to provide notice of final payment increased from $25 to $50.  Failure to provide a report of coverage to the commission within 30 days of the inception date of the coverage now incurs a minimum fine of $100 and a maximum fine of $250.

Apart from the impending move and coping with the impact of budget cuts, the agency is concentrating on scanning and digitizing its files, which will eventually reduce its need for storage space. Mr.  Cannon says he is also looking into cross-training agency employees so so they can fill a variety of roles.

“You have to adjust your business processes to adapt to the resources. All organizations today have to be flexible and nimble,” he says.

A graduate of the University of North Carolina at Chapel Hill, where he earned a Master’s in Public Administration, Mr. Cannon previously worked as a lobbyist for the Municipal Association of South Carolina. He also served stints as a city manager for Beaufort and Camden.

Since joining the agency in March 2009, Mr. Cannon says he has been focusing on improving internal communications at the agency. He has met with all the commissioners in one-on-one sessions and groups of employees by division. “I want to know what are the opportunities and what are the challenges we face at the Commission. If anyone has a better way of doing things we want to know about it,” he says.

Commission, surgery centers feud now in third year

Surgery centers have been fighting the Commission’s new Medicare plus 40% payment system from the moment the agency announced it in October 2006.  Several court fights later, the surgery centers remain victorious, and continue to charge what they were charging before the new payment system became effective.

The successful litigation to date has likely netted the surgery centers millions of dollars in charges they would have lost had they accepted the Commission’s payment system. Another way of looking at it is to note, as the Commission does, that employers and carriers would have saved nearly $4.4 million per year had the payment system applied to the surgery centers.

The Commission maintains the new payment system is necessary because both inpatient and outpatient charges in South Carolina were going through the roof.  Specifically, from 2000 to 2006, the number of workers’ compensation cases seen by ambulatory surgery centers increased 64%, while total charges increased 324%.

 The surgery centers have maintained in court they were denied due process when the Commission implemented its new system.  Speaking broadly, under the new system providers can charge no more than 140% of what Medicare would pay for the service.  That is, if Medicare would have paid $100 for a procedure, providers can charge $140 for treatment provided workers’ compensation cases.  

 Earlier this year, Judge John M Milling, presiding judge Fifth Judicial Circuit, ruled the surgery centers were denied due process.  The court said before making changes to the payment system, the Commission should have promulgated a new regulation and had it approved by the General Assembly. This process would have given involved parties appropriate notice and warning of impending changes.

Judge Milling concluded the Commission cannot enforce the new payment system against the surgery centers until it develops a regulation that is in accordance with the Administrative Procedures Act and has been reviewed and approved by the General Assembly.  “The adoption of a Regulation will afford the Plaintiffs with certain due process rights, including notice, an opportunity to be heard, and the opportunity for review and approval by the General Assembly,” the judge ruled.

The Commission has appealed the judge’s order before a Court of Appeals and also requested the state Supreme Court to intervene in the matter.  In the meanwhile, the surgery centers can continue to bill as before.

Registration open for Members Only Forum

There is still time to register for and exhibit at the self-insurers’ annual conference, scheduled for May 13-15 at Litchfield Beach & Golf Resort.

This year’s Members-Only Forum promises to be exceptionally relevant given the several new issues swirling around workers’ compensation. These include winding down of the South Carolina Second Injury Fund, Medicare’s new reporting requirements, potential impact of swine flu on workers’ compensation, and greater interest among employers in developing wellness programs. 

The program includes a panel discussion with several commissioners from the South Carolina Workers’ Compensation Commission.

You can see the program and registration list at www.scselfinsurers.com/newsletters/SCSelf-InsurersAnnualConference2009.pdf