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Caterpillar expresses strong reservations as workers’ comp bill advances

Sunday, May 29, 2011

* Caterpillar was at the heart of a huge controversy earlier this year after its CEO revealed he was being courted to move the company’s headquarters to another state because of Illinois’ business climate. The workers’ comp reform bill was seen by many as a chance to show Cat and other business leaders that the state was getting its act together. But Cat is dissatisfied with the workers’ comp reform plan which overwhelmingly passed the Senate yesterday. From a press release…

“At Caterpillar, our goal has been, and remains to help make Illinois one of the best states in the union for attracting investment and jobs. This legislation is a small step toward lowering the cost of doing business in Illinois. However, we remain concerned it will not put the state in a position to attract additional investments and jobs.”

“We are not opposed to this bill, but even with this change, more work needs to be done, or Illinois will continue to struggle to find companies willing to invest and grow their operations in the state. We will continue to encourage state officials to work toward meaningful reforms that will improve the business climate in Illinois.”

* Two Senators who represent the Peoria area, where Cat is based, went at it on the floor yesterday

Sen. Darin LaHood, R-Dunlap, charged the bill would not make Illinois competitive with other states. LaHood ticked off how Caterpillar decided to build an excavator plant in South Carolina and an engine plant in Texas as a “direct result of our workers’ compensation system here in Illinois.”

But Sen. David Koehler, D-Peoria, shot back with a frank question: “Is this better or worse than what the status quo is? I say it’s better.”

* Lots of Republicans who voted for the bill also expressed reservations during debate

“It’s important that we highlight, not to just the employers in Illinois, but to people who are looking at making investments around this nation that our job is not done here. This may not even be getting to first base,” said state Sen. Bill Brady, R-Bloomington. […]

“I would hope that we’re all open to a realistic review. If the costs don’t come down, we need to come back, but of course it needs a little bit of time to work,” state Sen. Minority Leader Christine Radogno, R-Lemont, said on Saturday.

* Sen. Brady also expressed regret at the 30 percent reimbursement rate hit taken by by the medical community. And the Medical Society made this point yesterday about that cut

Businesses said a 50 percent cut would be best, while medical groups said anything beyond 20 percent would be too painful for doctors and hospitals.

“Yes, Illinois competes for business, but you also compete for physicians,” said James Tierney, lobbyist with Illinois State Medical Society. “Fifty percent leave the state already. This legislation will make a very, very harsh practice environment that much worse.”

* Republicans say sponsoring Sen. Kwame Raoul’s harsh closing remarks cost him three SGOP votes

With the bill’s fate now in the hands of the House, which reconvenes today, Raoul gave a vigorous response to the lineup of mostly Republican critics who said the legislation didn’t go far enough.

“This is major reform, and you all cannot deny it. I refuse . . . to accept the characterization that this is just a step in the right direction. That’s political speak,” Raoul said. “This is major reform.”

Listen to Raoul’s remarks…

* Related…

* Senate approves workers’ comp reforms

* Editorial: Give OK to workers’ comp bill

- Posted by Rich Miller        

9 Comments
  1. - wordslinger - Sunday, May 29, 11 @ 2:53 pm:

    –“Yes, Illinois competes for business, but you also compete for physicians,” said James Tierney, lobbyist with Illinois State Medical Society. “Fifty percent leave the state already. This legislation will make a very, very harsh practice environment that much worse.”–

    Wait a minute. What does that have to with workers comp? Doctors here can’t make a living if you cut workers comp rates? They would still be the second highest rate to medical providers in the country, correct?

    Not only that, but are we to believe that 50% of Illinois doctors set up practices here, then flee because of a “harsh practice environment?”

    Or, is it that people come to Illinois from all over the world to BECOME doctors, and half of those go somewhere else once their studies are completed?

    If it’s the first scenario, show me. If it’s the second, then that 50% quote is razzle-dazzle bordering on dishonesty.


  2. - Alice in Wonderland - Sunday, May 29, 11 @ 3:02 pm:

    Claims are way down yet costs keep going up. Labor and Trial Lawyers face the biggest give backs in Ill workers’ comp history. Business gets more than they ever got when Republicans were in charge. Yet Republicans and business gripe that its not enough. Nothing makes sense. Just goes to prove if you say something loud enough and often enough perception becomes reality.


  3. - Yellow Dog Democrat - Sunday, May 29, 11 @ 6:12 pm:

    During debate, Senator McCarter claimed his bill — which every Republican supported — would cut worker’s comp costs by $700 million.

    According to the Dept of Insurance, the Raoul-Bradley bill saves $650 million.

    Raoul is right to berate Republicans on this point.


  4. - Moderate REpub - Sunday, May 29, 11 @ 6:58 pm:

    Yellow Dog Democrat - Sunday, May 29, 11 @ 6:12 pm:
    During debate, Senator McCarter claimed his bill — which every Republican supported — would cut worker’s comp costs by $700 million.
    According to the Dept of Insurance, the Raoul-Bradley bill saves $650 million.
    Raoul is right to berate Republicans on this point.

    YDD - Raul is the only one saying it will save $700 million. Most experts say $300 to $500. McCarter’s bill would have saved much more because of causation component. There would be a huge decline in the number of claims with causation and reductions in premiums.

    As McCann brought up lower premiums are what employers see in savings. The largest underwriter in Illinois says that a reduction in premiums will most likely be around 10% under the Raoul plan - 20% is probably not attainable but didn’t state it was impossible. McCarters plan would see a reduction of 40% or more in premiums.

    All employers care about is a reduction in premiums – no one knows what this bill will reduce premiums by. But I agree that something is better than nothing.

    As to Raoul being right to berate the Republicans - I disagree. I was there and it wasn’t about the issue. If you are a sponsor and have a problem with someone’s comments - you have the right between each speaker to rebut the testimony because you are the sponsor. Instead of taking that route Raoul waits till all the members speak and then starts yelling at everyone – and obviously doesn’t mention any previous speaker by name so they can’t speak? Give me a break – its low brow. Several of his own caucus agree. I know this because one of his colleges used the term “low brow” when speaking to several other Democrat Senators. You didn’t think that was a term I would use – did you?

    Not to mention there were only 8 “no” votes - would have been 5 if he wouldn’t have lost his S@#$. Who screams about a bill when the vote isn’t even going to be close? There are 24 Republicans and all leadership voted for it. There was no reason for his outburst at republicans because most republicans voted for the bill. Put a bad taste in many members mouths.


  5. - Yellow Dog Democrat - Sunday, May 29, 11 @ 7:21 pm:

    @moderate gop - during debate, it was mentioned repeatedly that the illinois dept of insurance estimated that the bill would reduce claims by $650 million, or 20%.

    Lawmakers from both sides of the aisle gave the dept director a standing ovation following debate, so I assume there is some faith in his numbers.


  6. - jake - Sunday, May 29, 11 @ 8:54 pm:

    House just voted down the workman’s comp. The Republicans caucused, came back and had caucused against it, and all Republicans voted “no” or “present”. Raoul was there to watch and went back to the Senate to introduce the House bill to blow the system up.


  7. - Yellow Dog Democrat - Sunday, May 29, 11 @ 9:24 pm:

    I was worried we’d have a boring end-of-session


  8. - just sayin' - Sunday, May 29, 11 @ 9:29 pm:

    Looks like the House Republicans are committed to opposing any positive progress, on anything.

    Seems like they want to see the state go down the tubes, hoping for political advantage. Hastn’t worked, won’t work, and pretty pathetic.


  9. - jake - Sunday, May 29, 11 @ 9:55 pm:

    The Republicans all said the reason they voted against was that the health providers were treated so badly in the bill. They all said they were in favor of reform, but voted against it.

    It was clearly on behalf of one special interest.


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