Opinion ID: 2083424
Heading Depth: 3
Heading Rank: 2

Heading: Minnesota's Enactment of Reform Measures

Text: Prior to the enactment of section 176.1812, Minnesota was reported to have one of the highest workers' compensation cost structures in the upper Midwest, with insurance rates of 30 to 40 percent higher than neighboring states like Wisconsin. See Dennis J. McGrath, Workers' Comp Bill Passes; 13 DFLers Cross Line in Senate Plan, Star Tribune, May 20, 1995, at 1A; Scott Carlson, Minnesota Companies' Workers' Comp. Costs Expected to Drop in 1996, Saint Paul Pioneer Press, September 9, 1995, at 1C. Faced with this competitive disadvantage, the legislature enacted section 176.1812 to offer workers who were members of unions that bargained with qualified employers the opportunity to opt out of the formal claims system in favor of a more streamlined, less costly ADR system. Section 176.1812 is narrow. It does not apply to all workers' compensation claims. Instead, it only authorizes the creation of ADR systems in collective bargaining agreements made by unions with qualified employers or qualified groups of employers, (essentially those who are self-insured or whose annual premiums exceed high threshold levels). Minn.Stat. § 176.1812, subd. 1. Section 176.1812 is also optional. It provides that the parties to collective bargaining agreements may continue to use the formal process or may choose to establish an ADR system that will supplement, modify, or replace the formal claims' process. Minn.Stat. § 176.1812, subd. 1(a).