Lawmakers in four states advanced proposals last week to reform their respective workers compensation systems, but it remains to be seen whether more states will attempt to revise their laws, observers say.

During the midterm elections, Republicans gained seats in Congress and in state legislatures. That has helped workers comp reform legislation gain momentum in Illinois, Montana, Oklahoma and Kansas.

In Illinois before the elections late last year, employers sought the right to designate doctors for injured employees. They also wanted to reduce the state's medical fee schedule, deny benefits when an injured employee tests positive for drugs and alcohol, and require the Illinois Workers' Compensation Commission to adopt utilization review findings, except in unique cases.

Illinois employers must provide benefits if an employee, for example, is injured during a weekend softball game, then aggravates that injury while at work, said Mark Denzler, vp of government affairs and chief operating officer of the Illinois Manufacturers' Assn. in Springfield.

While state lawmakers never took a vote on the proposal last year, Illinois employers may gain even more reforms this session, said Mr. Denzler, who noted that workers comp reform is a top priority for Republican lawmakers.

While Republicans still comprise a minority in Illinois' House and Senate, Democrats lost several seats in both chambers during the election. That means Democrats need Republican votes to pass their priority bills, and “horse trading” over votes likely will result in the adoption of workers comp reforms, Mr. Denzler said.

The proposal being discussed this year would incorporate last year's plan plus mandate the use of American Medical Assn. treatment standards. Illinois employers also want to make injuries compensable only if a workplace accident is the “primary cause” of an injury.

That led Illinois Gov. Pat Quinn's senior staff to meet last week with Democratic and Republican legislators to launch negotiations about what should be included in a workers comp reform bill, a spokeswoman for the governor said.

Meanwhile in Montana, Jon Bennion, government relations director of the Montana Chamber of Commerce in Helena, said he expects employers to gain a comp reform law this year.

Last week, Republicans in the Montana House of Representatives provided the votes to approve a second reading of H.B. 334 on the House floor over Democrats objections.

“A lot of the Republicans want to take a pretty aggressive approach to cutting workers compensation costs and they have significant majorities in the House and Senate,” Mr. Bennion said.

H.B. 334, sponsored by Rep. Scott Reichner, R-Bigfork, is the preferred bill for meeting their goals, Mr. Bennion said.

Among other changes, the bill would end medical benefits for most permanent partial disability claims five years after an injury, allow insurers to designate a physician for injured workers and require applying the sixth edition of the American Medical Assn.'s “Guides to the Evaluation of Permanent Impairment.”

Labor, claimants attorneys and Democrats say the bill is harsh on injured workers, and it would have to win the signature of Gov. Brian Schweitzer, a Democrat who reportedly expressed opposition.

Still, Mr. Bennion said significant reforms would emerge.

“Even if (H.B.) 334 doesn't survive in its current form, one way or another we will see workers comp reform from this legislature and the governor” because Montana is an expensive workers comp state, Mr. Bennion said.

Also last week, Oklahoma Gov. Mary Fallin challenged legislators during her State of the State address to craft reform legislation that would reduce legal and medical costs while returning injured employees to work sooner.

The Republican governor and the Republican leadership of Oklahoma's House and Senate—both of which recently added Republican members—want workers comp reforms this year, said Mike Seney, senior vp of policy analysis for the State Chamber of Oklahoma in Oklahoma City.

More than 30 workers comp bills have been introduced in Oklahoma, but “I'm not sure yet which ones are going to be moving forward,” said Mr. Seney.

Among other measures, the Chamber wants the Oklahoma Workers' Compensation Court replaced by an administrative system that would encourage mediation or settlement discussions before litigation, Mr. Seney said.

It also wants increased use of established treatment guidelines and legislation that would, through marketing, encourage employers to use certified medical plans, which are preferred provider organizations under Oklahoma's workers comp system, Mr. Seney said.

In Kansas, meanwhile, the House Committee on Commerce and Economic Development heard H.B. 2134 last week. The bill, sponsored by the committee, represents compromises between labor and business.

Under the bill, injured workers would gain increased maximum benefit caps that have not been raised since 1993, said Larry Karns, an attorney at Glenn Cornish Hanson & Karns in Topeka, Kan., who represents several employer groups including the Kansas Self-Insurers Assn.

A cap on permanent partial disability awards, for instance, would be increased to $130,000 from $100,000, death benefits would rise to $300,000 from $250,000, and a permanent total disability benefits cap would jump to $155,000 from $125,000.

The bill would address court decisions that hold employers responsible for post-injury wage losses even where the wage loss is due to an employee retiring, quitting or being fired. Under H.B. 2134, wage loss would have to be tied to the injury.

The bill also would increase the threshold for determining when an injury arises out of the scope of employment.

“We are hoping that will have a net effect of reducing claims in the system,” said Mr. Karns.

Additional proposals to revamp workers compensation laws could emerge in even more states this year because of recent political shifts, said Keith Bateman, vp of workers compensation at the Des Plaines, Ill.-based Property Casualty Insurers Assn. of America.

But it remains too early to say whether more states will embrace reforms this year. Priorities, such as addressing budget shortfalls, will come first, Mr. Bateman said.