Permanent Partial Disability Evaluations Under the Illinois Workers’ Compensation Act – Application of AMA Guidelines
Updated October 2016
Introduction and History
The determination of a permanent partial disability rating has never been an easy matter in the State of Illinois. The Illinois Workers’ Compensation Commission has always jealously protected its right to evaluate and determine the extent of permanent partial disability in every case. Until recently, there were no statutory guidelines for the Commission to use in evaluating permanent partial disability (PPD). The Commission did not rely on any written standards or published guidelines.
Many states for years have based their determinations of permanent partial disability on authoritative written guidelines published by the American Medical Association, the American Academy of Orthopedic Surgeons or some other nationally recognized medical association. The Illinois Workers’ Compensation Commission never used any such guidelines. In fact, prior to 2011 any medical opinions based on such guidelines were held inadmissible as evidence in proving the extent of permanent partial disability.
Further, the Commission did not allow testimony or narrative reports from any doctor as to the percent of impairment or disability incurred by the claimant. The Commission regarded such opinions as an invasion of its unique right to determine the extent of permanent partial disability. Consequently, for an individual unfamiliar to the Illinois workers’ compensation system, it was always difficult to accurately estimate the extent of the permanent partial disability award which may be rendered by the Workers’ Compensation Commission. Even for those who have been handling cases for many years, an estimate of permanent partial disability was never precise. This uncertainty has resulted in extensive litigation over the years because the broad ranges of PPD awards.
There were never books or articles which provided expert guidance in evaluating permanent partial disability. The only reference materials available to the adjuster and practitioner are prior Workers’ Compensation Commission decisions. In 1980, as a result of statutory changes, the Commission was first required to issue written decisions setting forth findings of fact and conclusions of law. Prior to the publication of written decisions, estimates as to permanent disability were based only on experience. The publication of decisions provides an excellent resource tool and made the determination of permanent disability somewhat less of a guessing game. There is no official reporter for Workers’ Compensation Commission decisions.
There are companies which publish indexes of Workers’ Compensation Commission decisions. These indexes provide a good reference to identify Commission decisions which may be similar to the case you are handling. However, as with all summaries, there are frequently facts contained in the decision which are not reflected in the summary. Moreover, it must be recognized that the cases that are tried to decision generally involve the more severe injuries and especially those where claimants wish to keep their medical rights open. Consequently, the awards for those types of cases tend to be higher than the settlements reached for similar injuries involving better recoveries.
Currently, the Commission now publishes it decisions and they are available for review on the Illinois Workers’ Compensation Commission website. www.iwcc.il.gov
Because there were no fixed medical standards upon which the Commission made permanent disability awards, the amounts of the awards and the percentages of disability have changed over the years as the decision-making personnel have changed. Although past decisions are to be precedent for subsequent Commission decisions, each of the commissioners and especially the arbitrators believed their individual assessment of permanent disability was more accurate than what may have been previously awarded.
Statutory Authority for Permanent Disability Awards
There are three different sections of the statute which provide for awards of permanent disability following an accidental injury. This article will analyze only awards for permanent partial disability, ignoring those cases of permanent total disability under Section 8(f) or wage differential under Section 8(d)(1).
The sections of the statute involved for permanent partial disability are §§8(c), 8(d)(2), and 8(e).
The WC statute was amended effective 2/1/06 and it increased the number of weeks to be awarded for loss of use of each member for PPD by 7.5% across the board except for awards for loss of use of the man as a whole. A table setting forth the maximum number of weeks for each member is attached to the end of this article along with a current Rate Sheet setting for minimum and maximum PPD rates.
Awards under §8(c) can be made for serious and permanent disfigurement. In order to qualify for a disfigurement award, the disfigurement must be to the hand, head, face, neck, arm, leg below the knee, or chest above the axillary line. The maximum disfigurement award for an injury is 162 weeks of permanent partial disability compensation. An award can be made for either disfigurement or disability, but not both.
Section 8(d) (2) provides for awards of permanent disability to the “man as a whole.” The maximum compensation which can be awarded is 500 weeks. (This figure did not increase in 2006.) This section normally applies to all neck and back injuries as well as other injuries to the head, ribs, heart, lungs, internal organs, etc. It also covers all alleged psychological or psychiatric injuries.
There are no specific credit provisions in §8(d) (2). Consequently, an employee can receive multiple §8(d)(2) awards even exceeding 500 weeks of compensation. This is an outrageous and ridiculous result, but according to our courts, it is legal. Consolidated Freightways v. Workers’ Compensation Commission, 237 Ill.App.3d 549; 604 N.E.2d 962 (1992). This anomaly in the statute was inadvertently created in 1975 and has never been corrected by the legislature.
Section 8(e) provides a schedule of benefits for member/extremity injuries. Each extremity is assigned a specific maximum number of weeks in the event there is a total loss of use of the member or an amputation.
There is a specific credit provision that applies to member injuries in §8(e) (17). That provision states that an employee cannot receive an award in excess of 100% loss of use of a member. In the event of multiple accidents with injuries to the same member, credit is given in the amount of the prior award against any subsequent awards or settlements. The amount of credit which is given is based on the percent of disability assigned, not on the dollar amount of the prior settlement or award.
The permanent partial disability rate is calculated by taking 60% of the employee’s average weekly wage. The permanent partial disability rate is subject to various minimums and maximums as set forth in the statute. The permanent partial disability rate cannot exceed the employee’s average weekly wage. If the AWW is below the minimum PPD rate then the PPD rate equals the AWW.
The maximum permanent partial disability rate increases annually if the state’s average weekly wages increases. The date of every increase is July 1, although the new rate does not go into effect until it is published. The new rates are not published until the December following the July 1 increase. If a settlement or award is made using the old rate, the claimant is not entitled to an adjustment.
The maximum PPD rates for the last 10 years are as follows:
7/1/05 – 6/30/06……………. $591.77
7/1/06 – 6/30/07……………. $619.97
7/1/07 – 6/30/08……………. $636.15
7/1/08 – 6/30/10……………. $664.72
7/1/10 – 6/30/11……………. $669.64
7/1/11 – 6/30/12……………$695.78
7/1/12 – 6/30/13……………$712.55
7/1/13 – 6/30/14……………$721.66
7/1/14 – 6/30/15……………$735.37
7/1/15 – 6/30/16……………. $755.22
The 2005 statute imposes new minimum rates effective for dates of accident after 2/1/2006 which are much higher than the old minimums. The new TTD and PPD minimums became:
Single – $173.33
Single +1 – $199.32
Single +2 – $225.32
Single +3 – $251.32
Single +4 – $260.00 (Max)
Furthermore, the statute provided for increases in the minimum rates every time the state minimum wage increased. The State minimum wage was increased to $7.50 an hour on July 1, 2007 and the TTD and PPD minimums were further increased to:
Single – $200.00
Single +1 – $230.00
Single +2 – $260.00
Single +3 – $290.00
Single +4 – $300.00 (Max)
The State minimum wage was increased to $7.75 an hour on July 1, 2008 and the TTD and PPD minimums were increased to:
Single – $206.67
Single +1 – $237.67
Single +2 – $268.67
Single +3 – $299.67
Single +4 – $310.00 (Max)
The State minimum was increased to $8.00 an hour on July 1, 2009 and the TTD and PPD minimums were further increased to:
Single – $213.33
Single +1 – $245.33
Single +2 – $277.33
Single +3 – $309.33
Single +4 – $320.00 (Max)
Finally, the State minimum wage was increased to $8.25 an hour on July 1, 2010 and the TTD and PPD minimums were increased to:
Single – $220.00
Single +1 – $253.00
Single +2 – $286.00
Single +3 – $319.00
Single +4 – $330.00 (Max)
I don’t expect a further increase in the state minimum wage in the near future. Our current Governor has advocated an increase in the minimum wage to $10.00 an hour over the next seven years, but Senate Democrats are pushing for an increase to $11.00 over the next 4 years which would markedly further increase the minimum TTD and PPD rates. Currently, legislation to increase the minimum wage seems unlikely to become law in the near future.
The automatic adjustments in the minimum rates are ridiculously high. They create an incredibly unfair burden on employers, especially employers who hire part-time workers. Very high minimum rates for part time and low wage workers are an incredible disincentive to return to work. The City of Chicago mandates a minimum wage of $10.00 increasing to $13.00 by 2019. This City ordinance affects only City of Chicago employees and not the state minimums.
2011 Amendments and the Introduction of AMA Guidelines
A major revision to the Illinois Workers Compensation statute occurred in June, 2011. One of the significant changes added a completely new section to the Act dealing with the issue of permanent partial disability calculations. This section of the Act applies to accidents on or after September 1, 2011. Prior to the addition of this section of the statute, there was no part of the statute that provided any instruction to the Commission with respect to determining permanent partial disability awards. There were no guidelines for the Commission to follow. Therefore, the Commission could award whatever it wanted as to a percentage loss of use for disability.
Awards of permanent partial disability were essentially non-reviewable in the courts since the courts routinely held that the determination of the amount of permanent partial disability by the Commission was uniquely the province of the Commission and not really reviewable by the courts.
There are no court decisions which have reduced the Commission’s award of PPD alone.
The change in the statute added an entirely new section which provides:
Section 8.1b: AMA Guides
Section 8.1b. Determination of Permanent Partial Disability.
For accidental injuries that occur on or after September 1, 2011, permanent partial disability shall be established using the following criteria:
- A physician licensed to practice medicine in all of its branches preparing a permanent partial disability impairment report shall include an evaluation of medically defined and professional appropriate measurements of impairment that include, but are not limited to loss of range of motion; loss of strength; measured atrophy of tissue mass consistent with the injury; and any other measurements that establish the nature and extent of the impairment. The most current edition of the American Medical Association’s “Guides to the Evaluation of Permanent Impairment” shall be used by the physician in determining the level of impairment. (Currently the Sixth Edition.)
- In determining the level of permanent partial disability, the Commission shall base its determination on the following factors:
- the reported level of impairment as assessed pursuant to subsection (a) (the AMA “Guides to the Evaluation of Permanent Impairment);
- the occupation of the injured employee;
- the age of the employee at the time of the injury;
- the employee’s future earning capacity; and
- evidence of disability corroborated by the treating medical records.
No single enumerated factor shall be the sole determinant of disability. In determining the level of disability, the relevance and weight of any factors used in addition to the level of impairment as reported by the physician must be explained in a written order.
Analysis of Statutory Change
The language of the statute appears fairly straight forward. A fair reading of the statute supports a conclusion that in determining permanent partial disability, the Commission should primarily rely on the impairment ratings based on AMA guidelines. A fair reading of the statute implies that if the other factors significantly alter the impairment rating, then they should be considered in granting permanent partial disability in excess of the impairment rating. Not surprisingly, there has been significant controversy concerning this section.
For the most part, impairment ratings as calculated pursuant to the AMA guidelines are remarkably lower than what the Illinois Workers’ Compensation Commission has routinely awarded for permanent partial disability.
This is not surprising since the Commission historically has awarded permanent partial disability based only on historical precedents and not any legitimate, quantifiable medical precedents. Petitioner’s attorneys argue that there is a vast difference between a permanent partial impairment rating and a permanent partial disability rating. Petitioner’s attorneys argue that impairment does not equal disability. Petitioner’s attorneys argue that even a minor impairment can create significant disability depending on the occupation of the employee.
Petitioner’s attorneys argue that a minor impairment can cause major disability. They point out that while a fractured finger might be rated as a minor impairment pursuant to the guidelines, it could cause a major disability for an individual who is a concert pianist. This argument is a valid one, but it ignores the fact that the vast majority of workers drives trucks and operates machinery and do not make a living as a concert pianist.
The practical application of this section of this statute has been frustrating for employers. The whole purpose of this statutory change was clearly two fold –
- Lower PPD awards and
- Make PPD awards more certain and easily ascertainable by basing them on published medical guidelines and not Commission decisions.
Initially, I had expected that both parties would be obtaining IME reports with conflicting impairment ratings. I expected that we would be fighting over the accuracy of the impairment rating of one doctor versus another doctor. However, that has not occurred. There are several reasons why that has not occurred.
First, the proper application of the AMA guidelines really is not subject to that much variation. Most doctors, if they properly apply the AMA guidelines to a claimant will end up with the same or a very similar impairment rating. The guidelines intentionally are not open to that much interpretation, subjectivity and variation. Depending on the evaluator, there could a variation in impairment ratings between doctors of 1% to 3%, but it is unlikely that there would be a major difference in an impairment rating from petitioner’s expert or respondent’s expert. (This article can’t delve into an analysis of the AMA Guides – but trust me when I say it is an intelligent authoritative text authored by really intelligent physicians).
Secondly and as previously indicated, the impairment ratings pursuant to the AMA Guides are remarkably lower than prior Commission decisions. Therefore, virtually no petitioner’s attorney ever arranges for an IME to obtain an impairment rating. If a petitioner’s attorney obtained a rating report, that rating report would tend to decrease a petitioner’s PPD award.
Instead, Respondents (carriers and employers) are the only ones to arrange for and obtain an impairment rating. Once that rating is received, employers then seek an award or settlement equal to the impairment rating. It only makes sense. If the claimant has returned to work at regular duty and has not suffered any wages loss, the amount of the PPD award should be equal to the impairment rating. This is not a radical and different point of view. Instead, this is what happens in most other states. In most other states that have impairment ratings, once a claimant is assigned an impairment rating, the employer pays the impairment/PPD and can then close the file.
In Illinois, there is no automatic obligation to pay PPD after an accident even if an impairment rating is given. (the only automatic PPD that must be paid is for amputations). Once an employer gets an impairment rating in Illinois, the employer can begin to negotiate a PPD settlement with the claimant.
Many petitioners’ attorneys routinely object to the admission of the impairment rating report and demand the right to cross-examine the IME Doctor. Therefore, we take numerous depositions of IME Doctors who perform impairment ratings. The primary focus of the cross-examination of the impairment rating doctor is to get the doctor to admit that “impairment” does not equal “disability.”