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Controversial Changes to Iowa’s Workers’ Compensation Law Leave Injured Workers in Cold

05 Jul, 2023 Claire Muselman

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Des Moines, IA (WorkersCompensation.com) - In a thought-provoking session at the 61st Annual Iowa Workers' Compensation Symposium, Abbie Steuhm, a distinguished Bill Riley Scholarship recipient, shed light on the far-reaching consequences of the 2017 changes to Iowa's Workers' Compensation Law. Her presentation, titled "Cracking the Cold Shoulder Case: A 5-Year Review of the 2017 Changes to Iowa's Workers' Compensation Law," addressed the detrimental effects of reclassifying shoulder injuries, resulting in a drastic decrease in compensation for injured workers.

Under the 2017 legislation, shoulder injuries were reclassified from body-as-a-whole (BAAW) injuries to scheduled member injuries, altering the formula for determining compensation. Instead of using the previous "industrial disability X 500 weeks" calculation, it was replaced with "impairment rating X 400 weeks," significantly reducing compensation for affected individuals.

These changes sparked the publication of "Giving the Workers the Cold Shoulder: Shifting the Risk under Iowa's Workers' Compensation Law," known as the Cold Shoulder Report. The report accurately predicted the adverse impact caused by the reclassification, revealing a staggering 73.2% decrease in compensation for injured workers.

The Cold Shoulder Report raised concerns about the unjust consequences of the 2017 legislative changes, highlighting how the reclassification of shoulder injuries shifted the risk burden from employers to workers. Injured workers were the ones facing the brunt of these changes, experiencing significant cuts in their compensation. The report's findings sent shockwaves through Iowa's labor community, prompting a closer examination of the issue.

During her presentation, Abbie Steuhm delved into the workers' compensation data from 2017 to 2021, providing a comprehensive analysis of the impact of the legislative changes. Comparing the numbers, it became evident that the changes profoundly affected the number of deputy decisions and single-injury shoulder cases.

In 2017, there were 322 deputy decisions, reflecting the arbitration process overseen by the deputy commissioner. However, in 2021, this number dropped to 263, indicating an 18% decrease. This decline suggests that fewer cases were being resolved through the arbitration process, potentially leaving injured workers uncertain.

Similarly, single-injury shoulder cases declined from 66 cases in 2017 to 22 in 2021, representing a 12% decrease. The reduction in cases indicates a significant drop in workers seeking compensation for shoulder injuries at the administrative adjudication level. This decline can be attributed to the change in classification and the resulting decrease in compensation, discouraging workers from pursuing claims.

To clarify the definition of "shoulder," Steuhm discussed two crucial cases that helped disambiguate the term within the context of the law. Chavez v. MS Technology, LLC and Deng v. Farmland Foods, Inc. were pivotal in defining what constitutes a shoulder injury. The glenohumeral joint, along with all the essential muscles, tendons, and ligaments for shoulder function, including the rotator cuff, acromion, and labrum, were included within this definition.

Delving deeper into the financial implications of the legislative changes, Steuhm compared the averages of total compensation between 2017 and 2021. The results were alarming; the data revealed a staggering 64% decrease in average total compensation. This decrease left workers with significantly diminished financial support in the event of shoulder injuries, posing severe financial hardships for them and their families.

Furthermore, by comparing each single-injury shoulder case with their pre-2017 estimated awards, Steuhm exposed the magnitude of the compensation losses suffered by injured workers. The data showed that compensation losses ranged from 45% to 90% for individual cases, with an average loss of 71.7% and a median loss of 69.8%. These numbers highlight the profound impact of the legislative changes on the financial well-being of injured workers and their ability to cope with the expenses and hardships resulting from their injuries.

Steuhm emphasized that her findings were consistent with those outlined in the Cold Shoulder Report. The report had already warned of the detrimental consequences of the reclassification of shoulder injuries and the subsequent decrease in compensation for workers. The legislative changes effectively shifted the burden of workplace hazards from companies to the workers themselves, their families, and taxpayer-funded social safety networks.

One significant concern raised during the session was the reversal of protections for older workers. The 2017 legislative changes removed the evaluation of a worker's age from the compensation calculation, leaving older workers particularly vulnerable. This removal of protections undermined the principle of equal treatment and fairness, potentially leading to age-based biases and discriminatory practices against older workers.

The impact of these changes extended beyond the individual workers affected. The shifting of risks onto injured workers and social safety networks burdened the entire community. Taxpayer-funded resources meant for supporting injured workers were strained, affecting the overall social welfare system. The consequences of these changes reached far beyond the individual cases, posing broader societal implications.

As the symposium continued, participants discussed and debated the need to reevaluate Iowa's Workers' Compensation Law. The revelations brought to light by Abbie Steuhm's presentation sparked a call for action to protect the rights and well-being of injured workers. Stakeholders, including labor advocates, legal experts, and policymakers, emphasized the importance of striking a balance between employers' interests and workers' rights.

In response to the concerns raised, there have been calls for legislative reforms to address the current system's shortcomings. Advocacy groups have been pushing for measures to reinstate fair compensation for shoulder injuries and restore the protection of older workers. These proposals aim to restore equity, ensure adequate support for injured workers, and hold employers accountable for workplace hazards.

To stay informed, interested parties are encouraged to refer to the court cases Chavez v. MS Technology, LLC and Deng v. Farmland Foods, Inc., which provided important clarifications regarding "shoulder" within the statute. Additionally, the Division of Workers' Compensation Decisions database and the Iowa Workforce Development Annual Report from 2017 to 2021 offer valuable insights into the trends and statistics surrounding workers' compensation in Iowa.

As the symposium drew close, the urgency to address the issues raised by the 2017 changes to Iowa's Workers' Compensation Law remained palpable. The seminar provided a platform for collaboration and the exchange of ideas, fostering a collective commitment to finding solutions that balance the interests of employers and workers' rights. Only through comprehensive reforms can Iowa's workers be assured of fair treatment, adequate compensation, and protection from the risks they face in the workplace.


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    • Claire Muselman

      Meet Dr. Claire C. Muselman, the Chief Operating Officer at WorkersCompensation.com, where she blends her vast academic insight and professional innovation with a uniquely positive energy. As the President of DCM, Dr. Muselman is renowned for her dynamic approach that reshapes and energizes the workers' compensation industry. Dr. Muselman's academic credentials are as remarkable as her professional achievements. Holding a Doctor of Education in Organizational Leadership from Grand Canyon University, she specializes in employee engagement, human behavior, and the science of leadership. Her diverse background in educational leadership, public policy, political science, and dance epitomizes a multifaceted approach to leadership and learning. At Drake University, Dr. Muselman excels as an Assistant Professor of Practice and Co-Director of the Master of Science in Leadership Program. Her passion for teaching and commitment to innovative pedagogy demonstrate her dedication to cultivating future leaders in management, leadership, and business strategy. In the industry, Dr. Muselman actively contributes as an Ambassador for the Alliance of Women in Workers’ Compensation and plays key roles in organizations such as Kids Chance of Iowa, WorkCompBlitz, and the Claims and Litigation Management Alliance, underscoring her leadership and advocacy in workers’ compensation. A highly sought-after speaker, Dr. Muselman inspires professionals with her engaging talks on leadership, self-development, and risk management. Her philosophy of empathetic and emotionally intelligent leadership is at the heart of her message, encouraging innovation and progressive change in the industry. "Empowerment is key to progress. By nurturing today's professionals with empathy and intelligence, we're crafting tomorrow's leaders." - Dr. Claire C. Muselman

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