On May 31, 2026, the Illinois General Assembly passed HB5228, which amended the Illinois Insurance Code and the Illinois Workers’ Compensation Act.  This bill will become effective when signed by the Governor.

The most important change is to Section 12 of the Workers’ Compensation Act. This amendment will impact day-to-day claims handling.  It is very important that anyone handling Illinois claims become familiar with this new law.  When an employer receives medical records from a treating health care professional requesting medical services, they can opt for Utilization Review under Section 8.7. It is common practice for many employers to use an IME to address a request for medical treatment instead of UR. The amendment indicates that if an employer opts for an IME under Section 12 instead of UR, that they have 90 days from receipt of the request for medical services to schedule and provide a copy of the IME report to the employee or the employee’s representative and the employee’s health professional. The amendment also states that the IME physician shall be board certified in the same specialty as the treating health care professional.  The amendment further states that if the employer fails to comply with this paragraph there is a rebuttable presumption that the employer shall be responsible for payment of additional compensation under Section 16 and subsection (l) of Section 19.  This applies to the failure to authorize or approve treatment as well as the failure to pay for treatment.

The daily practice summary of this amendment is:

· When an employer receives a written request to authorize medical treatment they are “on the clock”.  If the employer wants an IME, they have 90 days from the date that request is received to schedule the exam, complete the exam, and send the report to Petitioner or their representative and requesting physician.

· It can often take time to get an appointment with a reputable and highly qualified physician.  This does not allow a great deal of time to discuss strategy or authorization to schedule the exam.  Decisions and exams must be scheduled quickly.

· You must “match” up the board certification of your IME to the treating medical provider.  For example, if the treating medical provider is a board-certified orthopedic surgeon, you cannot use a physiatrist.  You must pay close attention to the specialty and certification of the treating provider.  If you rely on an IME vendor, make sure that they are aware of this law.

· If you do not comply with this provision (take 120 days to get the exam and tender report, use a physiatrist against a board-certified surgeon, etc.) there is a rebuttable presumption of penalties under Section 19 (l) ($30 dollars a day late fee up to a maximum of $10,000.00) and Section 16 (attorney’s fees).

· This provision applies to both the failure to pay for treatment and to authorize treatment.  The Hollywood Casino decision has long held that penalties cannot be awarded on the failure to authorize treatment.  This legislation may effectively limit the application of the Hollywood Casino decision.

· One issue that often arises when trying to get the IME completed and tendered within 90 days is medical records.  We sometimes need to subpoena records and gather imaging prior to the exam.  Many medical providers are slow to respond to this request.  Illinois is a non-discovery state which makes it even more difficult to gather records.  The amendment states that the employer or the employer's representative shall exercise due diligence in requesting and collecting the employee's medical records in accordance with all applicable laws.  That does not explain or provide a solution when records are not received in time for the IME.

· Best practice would be to proceed with the IME and get an addendum report if needed after the exam.

· It should be noted that this legislation states that it applies when an employer decides to use an IME instead of a UR on the reasonableness and necessity of medical treatment.

Taking note of the last point about UR, Section 8.7 of the Workers’ Compensation Act has been amended as well. The changes are:

· If the health care services requested are to be delivered or recommended by a physician, that the UR determination must be made by a physician as well. 

· The reviewing physician must have:

a. A current and valid nonrestricted license in any United States jurisdiction and a current certification by a recognized American medical specialty board in the area or areas appropriate to the subject of the review.

b. Experience treating and managing patients with the medical condition or disease for which the health care service is being requested.

· A certification shall be valid for three months after the date on which the employee and health care provider received the certification or for the length of treatment as determined by the Petitioner’s health care provider.

· If the certification is for a proposed surgery, it shall be inclusive of three months of postoperative health care services as clinically indicated by the treating health care professional or for the length of treatment as determined by the Petitioner’s treating health care professional.

It should also be noted that in death claims, the burial expense has been increased from $8,000.00 to $10,000.00.

There were also a couple of other changes that, while important, will not impact day-to-day claims handling.

Section 10 of the Illinois Workers’ Compensation Act was amended and states that any corporation, limited liability company, or partnership engaged in activities requiring licensure by a State agency, for which proof that it has insured its workers' compensation liability is a requirement for licensure, that fails to satisfy a requirement outlined in paragraph (1), (2), (3), or (4) of subsection (a) shall be subject to civil penalties under subsection (d) unless it shows by clear and convincing evidence that it was not operating during the time its license was active

Section 416 of the Illinois Insurance Code was amended regarding the funding of the Workers’ Compensation Commission.  In 2004, the Code was amended to create a surcharge on employers and insurance carriers to fund the Commission.  That provision has been amended. To fund the Commission, an additional surcharge shall be collected from companies that had an underwriting gain for their workers’ compensation and excess workers’ compensation lines in Illinois. That additional amount shall be a percentage calculated as the annual funding target for the year ($7,000,000.00 for 2026 and increased by 3.5% each year thereafter) divided by the statewide underwriting gain for the previous year multiplied by 100.

When does this all become law?

The date it is signed by Governor Pritzker.

Does this apply to existing cases or new cases?

As the legislation may be found to be procedural rather than substantive, it could apply to existing cases.  That should not include anything that transpired on a current case before the legislation was signed into law.

We will have to see how this new legislation plays out before the Commission and Courts.  The initial impression is that it appears to be another blow to employers following several recent adverse Court decisions such as McAllister and Tazwell County.

Unfortunately, the legislature has not done anything about tightening the fee schedule, addressing the dispensing and costs of prescriptions, or durable medical equipment. 

We will provide notice when the law is signed and the effective date.  In the meantime, if there are any questions, please feel free to contact any member of our Illinois Workers’ Compensation practice group.