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Proposed New Jersey Legislation will Significantly Affect Insurance Carriers, Third-Party Administrators and Employers in Workers’ Compensation Matters

Workers' Compensation; Bill 3375; New Jersey

New Jersey
February 24, 2021
February 24, 2021
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On January 21, 2021, Bill 3375 was introduced to the Senate. If passed, Bill 3375 will present significant consequences for insurance carriers, third-party administrators and employers in workers’ compensation matters. The bill concerns medical treatment arising from workers’ compensation claims. Unfortunately, Bill 3375 may greatly increase the costs and obligations of the employer under New Jersey workers’ compensation framework.

The proposed bill contemplates these changes:

  • Bill 3375 places restrictions and limitations on the respondent’s control and the direction of medical care. Once treatment has been authorized by a respondent, the respondent cannot delay or deny authorization for continued treatment, diagnostic studies, procedures, therapies or medications recommended by that authorized medical care provider. This change will affect only those cases in which the respondent disagrees with the authorized doctor. Rather than unilaterally deciding to transfer care and/or to obtain a second opinion, Bill 3375 will require that the respondent petition the court to see if benefits should be terminated. This change shifts the burden: under the current practice, petitioners have the choice to apply to the court with their own medical opinion in cases where the respondent disagrees with an authorized doctor.
  • Bill 3375 shifts the costs of litigation to the respondents. If a motion for temporary disability and/or medical benefits is filed, the respondent must pay for the costs of presenting the motion, including, but not limited to, the costs of all expert witnesses. In addition, Bill 3375 places a mandated 20% counsel fee paid to the petitioner’s attorney by respondent on all medical and temporary disability benefits paid after the motion filing. Interestingly, the bill does not distinguish between the filing of a motion and the entry of an order. Therefore, under the new bill’s paradigm, respondent could be responsible for these costs despite being successful in opposing a motion. The unfortunate result will be a significant increase in motions filed by petitioners; there will be little risk in filing a motion if they know that the expert will be compensated by the respondent.  
  • Bill 3375 eliminates in-person court proceedings. Neither petitioner’s attorney nor respondent’s attorney would be permitted to appear during in-person conferences and/or approval of settlements. Under Bill 3375, unless a party can show good cause for the necessity of an in-person proceeding, all appearances must be conducted via telephone or video conferencing. The proposed bill does not appear to apply to trials, which may still be conducted in-person.  
  • Bill 3375 places restrictions and limitations on the communication between respondent and authorized medical providers. The bill mandates that any communication, written or verbal, between a respondent and an authorized medical provider, must be simultaneously shared with the petitioner’s attorney. This requirement will heavily affect nurse case managers, who will need permission from petitioner’s attorneys to be present at exams. Additionally, petitioner’s attorneys will have access to all nurse case managers’ notes.  
  • Bill 3375 provides wide discretion for judges to assess fees. Judge will no longer be statutorily capped at what and how much they can assess regarding fees associated with the presentation of a case. The proposal provides that any fees that judges determine are necessary for the proper presentation of a case shall not be limited. This provision would pertain to counsel fees. Therefore, if deemed necessary, judges would have the ability to award more than a 20% counsel fee on a permanent disability award to petitioner’s attorney.  

A different bill also poses serious consequences: Bill A2617 concerns the employment of injured workers who have reached maximum medical improvement. As it stands currently, the respondent has no obligation to offer and/or to ensure a job for the petitioner upon the completion of treatment.  

If passed, Bill A2617 would require an employer with at least 50 employees to provide a hiring preference to an employee who was injured in a work-related accident; who has reached maximum medical improvement; and who cannot return to the employee’s former position with that employer. The employer is only required to provide an offer if the employee can perform the essential duties of an existing, unfilled position. The bill does not require an employer to create a new position for the employee, nor does it require the employer to remove another employee from an existing but filled position to accommodate the injured employee.  

These changes will alter the way in which we practice workers’ compensation altogether in New Jersey. More importantly, these bills could have a dramatic, chilling effect by increasing the cost of conducting business in New Jersey. These one-sided changes fail to consider the consequences for employers.

Contact your representatives to object to these radical proposals. Chartwell Law will be monitoring this legislation every step of the way to keep you apprised.