Oklahoma passed a workers' compensation reform bill on April 30, 2013 – Senate Bill 1062 overhauls the entire Oklahoma workers' compensation system. The bill consists of three different parts:
1. The Administrative Workers' Compensation Act (the "Administrative" act)
2. The Oklahoma Employee Injury Benefit Act (the "Option")
3. The Workers' Compensation Arbitration Act (the "Arbitration" act)
The Oklahoma Injury Benefit Coalition (OIBC) was formed in 2011 by some of Oklahoma's top employers. Since its inception, the OIBC has worked for legislation to improve the state's workers' compensation system. SB 1062 is due in part to the OIBC's efforts.
The OIBC held its first ever seminar on November 5, 2013. Several presenters and speakers contributed during the seminar, including Oklahoma Insurance Commissioner John Doak who vowed, "No more passing over our state due to high cost of insurance." Senator Anthony Sykes, often referred to as the father of the administrative system and one of the first to push for these drastic changes, stated that they looked at the Arkansas workers' compensation laws and the Texas non-subscription system for guidance in creating SB 1062 due to the low workers' comp rates in these states. The idea was not to mirror Arkansas or Texas, but to take items that worked for these states and bring them to Oklahoma. When asked about the challenges to the bill, Senator Sykes stated "The Battle is just beginning." Representative Leslie Osborn said that if the Supreme Court rules that SB 1062 is unconstitutional they will review the court ruling, correct the problems and resubmit before the next legislative session begins. Representative Osborn also stated the February 1, 2014 start date for the new law was strategic, allowing sufficient time for "band-aid" revisions if needed. Based on their words and demeanor, they are ready to keep up the fight until change occurs.
Three Oklahoma workers' compensation commissioners have been appointed: Troy Wilson, Robert Gilliland, and Denise Engle. Robert Gilliland is a long-time Oklahoma attorney, Denise Engle is a former deputy insurance commissioner, and Troy Wilson is a businessman from the private sector. It is apparent that the commissioners were chosen in part due to their diverse backgrounds. The commissioners' first order of business has been to write the emergency rules for the system, which were just published on December 2. In addition, there will be a public hearing on the published rules on January 2, 2014. Sedgwick will work through the OIBC to help support the intent of SB 1062 through this regulatory process.
As far as an update to the legal challenge to SB 1062, it was noted that the OIBC, the Oklahoma City Chamber and the Tulsa Chamber of Commerce have joined the suit in support of the bill. On November 14, the Oklahoma Supreme Court reviewed the lawsuit filed challenging SB 1062. After review, the Supreme Court retained jurisdiction and scheduled oral arguments to be heard on December 10. The Oklahoma Attorney General's office will be defending the case. Members from the Oklahoma Attorney General's office also presented at the OIBC seminar, but were limited to the amount of detail they were able to provide due to the pending litigation. This being said, they did feel the Supreme Court would make a ruling soon. A specific date for the expected ruling was not provided.
The new law goes into effect on February 1, 2014 and it appears that Oklahoma is doing everything possible to be ready on that date. The Oklahoma Supreme Court could grant a stay to prevent any changes to the existing workers' compensation law until they have made a ruling, but currently no request for a stay has been received. If no stay is requested, our clients will have to make a choice to handle their claims under the "Administrative Act" or under the Oklahoma "Option." Either way, Sedgwick will be ready to help them with all their claim needs.
Eddy Canavan, Director National Technical Compliance
Chance Fleming, Claims Manager
For additional coverage of Oklahoma's workers' compensation changes, you may also be interested in reading the following: