COMMONWEALTH OF PENNSYLVANIA
HOUSE OF REPRESENTATIVES
LABOR AND INDUSTRY COMMITTEE
ROOM G-50 IRVIS OFFICE BUILDING
HARRISBURG, PENNSYLVANIA
OCTOBER 2, 2018
10:00 A.M.
PRESENTATION ON: HOUSE BILL 1909
CLARIFYING WORKERS' COMPENSATION COVERAGE FOR VOLUNTEER EMERGENCY RESPONDERS
BEFORE:
HONORABLE ROB KAUFFMAN, MAJORITY CHAIRMAN HONORABLE JOHN GALLOWAY, MINORITY CHAIRMAN HONORABLE SHERYL DELOZIER HONORABLE CRIS DUSH HONORABLE SETH GROVE HONORABLE DAWN KEEFER HONORABLE KATE KLUNK HONORABLE DAVID MALONEY HONORABLE JESSE TOPPER HONORABLE MARIA DONATUCCI HONORABLE JEANNE MCNEILL HONORABLE ED NEILSON HONORABLE PAM SNYDER 2
1 COMMITTEE STAFF PRESENT:
2 REPUBLICAN CAUCUS:
3 JOHN SCARPATO, EXECUTIVE DIRECTOR
4 SHANNON WALKER, RESEARCH ANALYST
5 ELANA MAYNARD, LEGISLATIVE ADMINISTRATIVE ASSISTANT II
6 REPRESENTATIVE KRISTIN PHILLIPS-HILL
7 DEMOCRATIC CAUCUS: 8 HALEY SALERA, EXECUTIVE DIRECTOR 9 EVAN FRANZESE, RESEARCH ANALYST 10
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2 T E S T I F I E R S
3 * * * PAGE 4 REPRESENTATIVE KRISTIN PHILLIPS-HILL...... 5 5 PRIME SPONSOR OF HB 1909
6 DUANE HAGELGANS...... 8 COMMISSIONER, BLUE ROCK REGIONAL FIRE DISTRICT 7 PA FIRE AND EMERGENCY SERVICES INSTITUTE
8 SAMUEL MARSHALL...... 25 PRESIDENT, INSURANCE FEDERATION OF PA 9 WILLIAM TAYLOR...... 29 10 PRESIDENT, PA COMPENSATION RATING BUREAU
11 ELAM HERR...... 60 ASSISTANT EXECUTIVE DIRECTOR 12 PA STATE ASSOCIATION OF TOWNSHIP SUPERVISORS
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2 MAJORITY CHAIRMAN KAUFFMAN: It is 10:00, and I
3 like to keep things moving; and Grace agrees with that. We
4 are so privileged to have Representative Klunk bring her
5 sweet little girl, Grace, with her this morning. So Grace
6 is going to lighten up the mood in here, if anything gets
7 exciting.
8 And if we could all rise for the Pledge of
9 Allegiance, as we are able.
10 (Pledge of Allegiance.)
11 MAJORITY CHAIRMAN KAUFFMAN: And this meeting is,
12 of course, being recorded; so please take note of that and
13 silence your devices to keep interruptions to a minimum.
14 And if you want to see more pictures of Grace, you just have
15 to follow Representative Klunk on her social media and you
16 get to see all kinds of great kid pictures.
17 So would the secretary please call the roll this
18 morning?
19 (Roll call was taken.)
20 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much.
21 Today we will be discussing House Bill 1909, a proposal by
22 Representative Kristin Phillips-Hill which would amend the
23 Workers' Compensation Act to clarify the coverage
24 requirements for volunteer emergency service organizations.
25 And Representative Kristin Phillips-Hill has joined 5
1 us up here today, as this is the legislation -- her
2 legislation that we're looking at. And I'd first like to
3 recognize Representative Phillips-Hill for some brief
4 remarks and background for her bill.
5 Representative Phillips-Hill.
6 REPRESENTATIVE PHILLIPS-HILL: Good morning,
7 Chairman Kauffman, and thank you very much for conducting
8 this hearing.
9 On Friday, August 31st, York County was caught by
10 surprise when forecasted rain turned quickly into
11 significant flooding in several areas. And the average
12 person probably wondered how quickly our local emergency
13 responders were going to handle it all. They didn't have
14 to.
15 The one thing that never changes is the fraternity
16 and dedication of our emergency responders. When they were
17 asked to respond, like so many other volunteers, their
18 answer was, Where do you need us? Response teams came from
19 neighboring areas and quickly went to work to address
20 whatever was necessary. You're absolutely right, Grace;
21 they did a great job.
22 So in support of the local volunteer groups who
23 were already very hard at work, problems were solved ahead
24 of schedule, thanks to talented men and women who do not do
25 this full time. 6
1 York County has a very proud tradition in emergency
2 response, and I'm certain we are not alone. Today we are
3 here because they need us. Last year, a constituent of mine
4 was injured while working with the volunteer fire company in
5 her community at a volunteer fire company carnival. The
6 incident left her unable to work. This incident was again
7 repeated six months later at another volunteer fire company
8 in my district.
9 The Workers' Compensation Law protects members of
10 volunteer fire departments or volunteer fire companies when
11 participating in certain activities. Since my constituent
12 was participating in one of the statutorily prescribed
13 activities and she is a member of her volunteer fire
14 company, a workers' compensation claim was filed.
15 To her surprise, coverage was denied because the
16 municipalities insurer and the State Workers' Insurance Fund
17 interpret the meaning of the term member to only include
18 firefighters.
19 When the incident was brought to my attention, I
20 went to work and authored House Bill 1909, the subject of
21 this hearing today. The legislation will remedy this issue
22 by clarifying that when the Legislature says member, it
23 means any member, including officers, directors,
24 firefighters and any other member of a volunteer fire
25 company or volunteer fire department. 7
1 Because similar language exists for volunteer
2 ambulance corps and volunteer rescue and lifesaving squads,
3 House Bill 1909 makes conforming changes to these
4 subsections, as well.
5 Mr. Chairman, I'm sure you and the members of this
6 Committee know full well how very vital our emergency
7 responders are to our communities, how hard they work, and
8 how many sacrifices they and their families make for the
9 good of their friends, neighbors, and communities.
10 Today we're here to take another step closer to
11 correcting language that is in definite need of correction.
12 Thank you so much for your time. Thank you to today's
13 testifiers for coming forward, and I'm happy to answer any
14 questions that you may have.
15 MAJORITY CHAIRMAN KAUFFMAN: Thank you,
16 Representative Phillips-Hill.
17 And now I'll move on to our first witness with us
18 today to provide perspective from emergency service
19 organizations. And first up, we have Duane Hagelgans,
20 Commissioner of the Blue Rock Regional Fire District from
21 the Pennsylvania Fire and Emergency Services Institute.
22 Welcome, Duane; and you may take a seat and pull
23 that microphone up close to your mouth so we can hear you.
24 Sometimes we have some glitches here in the room. So thanks
25 for being here today, Duane. 8
1 MR. HAGELGANS: Thank you very much. Can you hear
2 me?
3 MAJORITY CHAIRMAN KAUFFMAN: No. Slide forward.
4 MR. HAGELGANS: Hello.
5 MAJORITY CHAIRMAN KAUFFMAN: Yeah, you're getting
6 better. There you go.
7 MR. HAGELGANS: First of all, thank you for your
8 legislation. As mentioned, I'm with the Blue Rock Regional
9 Fire District, so we're in Lancaster County. We do Manor
10 Township, Millersville Borough. We consolidated four
11 volunteer fire companies back in 2011 to try and sustain the
12 volunteer fire service. And without this legislation, you
13 can probably start to figure out how you can pay the fire
14 service across Pennsylvania, to the tune of not millions but
15 billions of dollars.
16 I'm not going to go in depth to what I wrote. You
17 can certainly read the narrative that I handed in. But the
18 volunteer fire service is struggling, and this is just
19 another way to further put one more nail in the coffin of
20 the fire service.
21 Unfortunately, this legislation has to be written;
22 because as a former practicing workers' comp attorney, I can
23 tell you that the legislation's already there. The law's
24 already there. The Workers' Comp Act protects people that
25 are helping their volunteer fire companies; it protects 9
1 members that are fundraising; it protects members that are
2 fire police; it protects firefighters. So for whatever
3 strange reason, since Act 46 and the cancer legislation, and
4 we all got thrown into SWIF, I can tell you that I've
5 testified now before the House and the Senate multiple times
6 about this. Our workers' compensation was $12,000 in 2012.
7 Our workers' compensation today under SWIF is $70,000.
8 That's taxpayer money that's going to the state.
9 SWIF testified before the Senate last year. I was at that
10 hearing, and I testified that they have taken in about $21
11 million a year in premiums, and they're paying out about $3
12 million.
13 So in the last five years, SWIF has accumulated
14 about $100 million of your tax dollars and my tax dollars in
15 their coffers, which is pretty good for them considering
16 them then denying claims that are legally on the books.
17 You know, this legislation clarifies it; and we
18 certainly need this legislation. But the reality of it is,
19 I've had cases when I was a practicing attorney doing
20 workers' comp; and these situations where people are doing
21 fundraising has always been covered, as long as a
22 municipality agreed that these activities were what the fire
23 company was allowed to do, it's covered.
24 The law's out there. The case law is very clear.
25 You can go read it yourself. You don't need me to tell you 10
1 that. But is SWIF at blame? I mean, SWIF is the insurer of
2 last resort. The reason the state has SWIF is because, you
3 know, there's high-risk employers out there that couldn't
4 get insurance; so that's why SWIF was developed. SWIF was
5 kind of, you know, always barely surviving until we came
6 along and we funded them very well after Act 46 and the
7 Cancer Presumption Law.
8 So we're now in a situation where when I heard
9 about this first claim -- and I'm not sure that York County
10 was the first claim -- there's been some others that we've
11 heard about around the state where people are denied because
12 they're not firefighting activities.
13 We have these people that risk their lives day in
14 and day out for your benefit and mine, and then they turn
15 around and on weekends and evenings they do fundraising to
16 buy their own gear, to pay for their own insurance, which
17 now, of course, is five times as much. They do these things
18 because they're the kind of citizens that we should all be.
19 Right? They're out there, and they're helping people.
20 And then we turn around and we find out that
21 because they're doing fundraising, they're not at a fire
22 scene or maybe they're directing traffic. Is directing
23 traffic a firefighting activity? Probably -- I mean, in my
24 mind, certainly it is. In SWIF's mind, who knows.
25 SWIF has been very good to make it as challenging 11
1 as possible for us in the volunteer fire service. We're
2 very fortunate at Blue Rock that we have a part-time paid
3 administrator, but she spends hours and hours on the phone
4 waiting for SWIF to answer many times.
5 After the SWIF hearing with the Senate last year,
6 SWIF decided that they would do us all a favor and they
7 switched us all to their Johnstown office. Once we got
8 switched to the Johnstown office, everything started all
9 over again.
10 In fact, the first one of our members that had a
11 minor injury, the first question they were asked is, What is
12 their ethnicity? And I'm trying to figure out, legally, how
13 they can ask what the ethnicity of the member is and what
14 that has to do with being injured on a fire call.
15 But my bigger concern was, I now have volunteers
16 that do fundraising that I'm afraid to ask them to do it. I
17 have volunteers that go out and direct traffic. I'm afraid
18 to ask them to do it. I've had to basically tell our fire
19 police, there's things that I don't want you to do because
20 I'm too afraid that you're going to get hurt. And if you
21 get hurt, I can't guarantee that you have workers' comp
22 coverage. I don't want you to lose your house or lose your
23 job because you're volunteering to help your community, to
24 raise money, to buy your own gear, to buy your own
25 insurance, to keep the lights on, and then you get injured 12
1 and SWIF's going to say you're not covered when you're
2 clearly, clearly covered under the current law; but
3 hopefully the new legislation will make it so much clearer.
4 The reality of it is, SWIF was thrown into this,
5 you know. They didn't ask for us, they got us. They
6 benefitted from us, obviously, with the amount of premiums
7 they're taking in. When SWIF testified, and I'm not here to
8 bash SWIF, but when they were testifying they said, we had
9 an actuarial study which, of course, is a great term to use
10 to get lots of money for premiums and, you know, they don't
11 know what's going to happen under the cancer law.
12 I can tell you if you read my testimony that the
13 cancer law really helps career firefighters. I was a career
14 firefighter for 28 years. I understand that. It doesn't
15 help the volunteers because of all the things that it makes
16 you do in order to get the cancer presumption.
17 Long story short is, the volunteer fire service is
18 struggling in Pennsylvania. Without this legislation, we --
19 you know, what do I tell my members; what do I tell my
20 volunteers? I'm afraid for you to do anything other than go
21 to fight a fire.
22 I mean, if they're so narrowly defining what
23 firefighting activities is to only whatever, you know, going
24 to an actual fire. I mean, we've had some minor injuries
25 through the course of time. Luckily, all of our members 13
1 have, you know, survived; but it's scarey when you're
2 sitting there and you have volunteers, dedicated volunteers,
3 that don't know if they get injured while helping their
4 community, if they're going to be covered or not. And even
5 if they fight it, we'll just have them file a lawsuit and
6 they'll win.
7 What do they do in 9 months or a year when they're
8 not getting paid? You know, we have supplemental insurance
9 that we pay, but it's not going to keep somebodies mortgage
10 paid and it's not going to keep somebodies family fed.
11 So I thank you very much for this legislation.
12 It's much needed. But the reality of it is, the law's
13 already on the books, if we could just get SWIF to follow
14 the law that's already written; but this will certainly help
15 clarify it.
16 And thank you very much for defending us and for
17 helping us. The volunteer fire service, I'll just say in
18 closing, was about 250,000 members in Pennsylvania in the
19 1970s. I did a study recently, and we're down to about
20 50,000. And, you know, if we want to sustain the volunteer
21 fire service, we need to do what we can to keep these
22 dedicated men and women out there.
23 The federal government's helping us. They're,
24 believe it or not, sending us a lot of money to help recruit
25 and sustain volunteer firefighters. Lancaster County got 14
1 about a $400,000 grant; but, you know, how can you tell
2 somebody, Sure, come help us; and then if you get injured,
3 hopefully, we'll be able to cover you with workers' comp?
4 Thank you very much.
5 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much,
6 Commissioner Hagelgans. Just a note, we did have Sandy
7 Yancey with Rescue Fire Company No. 1 in Representative
8 Phillips-Hill's district who was to testify. But when we
9 had to change everything around due to session schedule, she
10 was unable to make it; so her testimony is in our packets.
11 I wanted to open it up for questions for
12 Commissioner Hagelgans, and I think Representative Neilson
13 is first.
14 REPRESENTATIVE NEILSON: Thank you, Mr. Chairman.
15 Thank you, Commissioner, for your service to the
16 Commonwealth. You mentioned about your premiums going up
17 and now lack of coverage. In your old policy, was this kind
18 of activity covered under your insurance?
19 MR. HAGELGANS: One hundred percent. We were under
20 a Susquehanna Mutual Trust. And as I wrote in my testimony,
21 when I showed up at the very first meeting after we
22 consolidated our four volunteer fire companies, I was told
23 that we were being dropped because of the new cancer
24 legislation. And we looked high and low. And every year we
25 shop and we try and get insurance, but SWIF is really the 15
1 only company that will insure us, if you can call them a
2 company, an agency.
3 To the best of my knowledge, there's about 3,000
4 volunteer fire companies in Pennsylvania insured by SWIF.
5 But, yeah, under our previous policy, this was all covered.
6 Certainly, if you look at case law, these activities have
7 always been covered as long as the municipality agreed that
8 the volunteer fire company or fire service was doing this as
9 part of their fire -- I mean, I understand there's people
10 that argue the difference between social members and
11 firefighting members. Right?
12 So some fire companies have social members. You
13 pay your couple dollars and you're a social member. Totally
14 different than somebody literally doing something to help
15 the volunteer fire company, which is what --
16 REPRESENTATIVE NEILSON: I was going to ask you
17 that next, because I am a social member of a volunteer fire
18 company outside of the city; and the reality is, I'm there
19 for social events.
20 MR. HAGELGANS: Right.
21 REPRESENTATIVE NEILSON: I'm there to maybe back a
22 couple colas with some of my friends that are part of the
23 department. But that's part of social. I mean, how do you
24 decipher either one? I mean, I'm a social member. I get
25 hurt on the way out the door, should I be -- I mean, it's a 16
1 big umbrella. So without -- I mean, it is a big umbrella.
2 MR. HAGELGANS: Right.
3 REPRESENTATIVE NEILSON: And I'm trying to
4 decipher. How do you -- is there something we should do
5 about, like, putting the meaning of social -- as far as the
6 volunteer social, I don't volunteer for the company at all.
7 MR. HAGELGANS: Right.
8 REPRESENTATIVE NEILSON: I'm purely a social
9 member. I probably maybe even go there once a year, and I
10 make certain I pay every year to make certain that --
11 because it's money that you need anyhow. I mean, we do the
12 social membership to raise the money. I mean, that's real.
13 They used to do it in an ambulance company in my
14 neighborhood. They used to come by and grab $10.00 a house
15 to become a social member of that, and I don't even think I
16 ever knew where it was.
17 MR. HAGELGANS: Right.
18 REPRESENTATIVE NEILSON: But it was just that
19 donation. It's kind of the way that you get your donations
20 as social members.
21 MR. HAGELGANS: I think it's a pretty clear line.
22 I mean, being a social member, no disrespect, but being a
23 social member is the same thing as a citizen showing up at a
24 festival.
25 REPRESENTATIVE NEILSON: Right. 17
1 MR. HAGELGANS: And I give them money. And active
2 members are very clearly defined. You know, whether you're
3 active from the standpoint of you're literally going out on
4 incidents or whether you're active from the standpoint that
5 you're doing administrative work -- I mean, we have
6 administrative members that help us tremendously. We have
7 six or eight administrative members that will come in and
8 file paperwork and do typing --
9 REPRESENTATIVE NEILSON: And volunteer their time
10 for that.
11 MR. HAGELGANS: So they're helping --
12 REPRESENTATIVE NEILSON: The organization as a
13 whole.
14 MR. HAGELGANS: The fire organization. There are
15 people that do fundraising. They're actively doing
16 fundraising for us. I think there's a really clear line
17 between a social member and somebody furthering the
18 organization, whether it's fundraising, administrative --
19 REPRESENTATIVE NEILSON: Well, you say this is part
20 of the law already, it's just not enforced. Do you think we
21 should put further definitions in maybe? Would that be the
22 helpful end to define each one of these roles -- or not so
23 much each role; but, you know, if you're not social, if you
24 can contribute it to the overall function of the department
25 itself, I mean, just something as broad as that may be able 18
1 to cover --
2 MR. HAGELGANS: And I think most organizations that
3 -- like we don't have social members in our organization,
4 and I know a lot in Lancaster County do. But I think that,
5 truly, how you join and what you do defines that; and a
6 social member is, again, the person that comes down and
7 drinks the soda versus the person that's actually physically
8 doing something to better the fire organization or the
9 ambulance organization or the rescue organization, whatever
10 that may be, you know.
11 I think it's pretty clear. I think it's common
12 sense to say that I'm fundraising for the organization; I'm
13 doing administrative work for the organization; I'm doing
14 firefighting for the organization, that I need to be covered
15 under this workers' comp versus I pay my $5.00 and I'm a
16 social member, because there's a social club or there's --
17 it's a donation.
18 REPRESENTATIVE NEILSON: It's a donation for me.
19 It's clearly a donation. All right. Thank you, Chairman.
20 I have nothing further.
21 MR. HAGELGANS: And I believe there was something I
22 read at one point that did separate social members from
23 others; but I can't, off the top of my head, say that.
24 MAJORITY CHAIRMAN KAUFFMAN: Representative Dush.
25 REPRESENTATIVE DUSH: Thank you, Chairman. Duane, 19
1 just to be clear, like, if you got people who are -- they've
2 been in a fire company for decades and now they're too old
3 to go out on the calls but they're still there -- like if
4 they're out there doing fundraisers, grilling chicken,
5 they're necessary to the operation?
6 MR. HAGELGANS: A hundred percent.
7 REPRESENTATIVE DUSH: The people who are standing
8 there on the boot drives, they're necessary to the
9 operation?
10 MR. HAGELGANS: A hundred percent.
11 REPRESENTATIVE DUSH: The people who are doing the
12 administrative work, filing the request for reports for the
13 grants or whatever's necessary, they're necessary to the
14 operation of those?
15 MR. HAGELGANS: Yeah, I literally got off the phone
16 call in the parking lot with FEMA this morning; and one of
17 the things that they mandated for us to get our grant is
18 that we must have our fire reports done. Somebody has to do
19 that.
20 And if we can have administrative people doing
21 that, which we do, that takes less time away from our active
22 firefighters; and that's a very important task, a hundred
23 percent.
24 REPRESENTATIVE DUSH: So the difference for our
25 emergency responders versus any other volunteer 20
1 organization, they are a direct benefit to the community in
2 providing emergency response services; and there's a reason
3 why they are included in workers' compensation. And every
4 one of these people that you're describing and the
5 activities that they're involved in are a direct benefit to
6 keeping those operations running, and I think that is a
7 point of clarification that this law -- or this bill seeks
8 to address; and I appreciate you giving the clarification to
9 that.
10 MR. HAGELGANS: You're welcome. Yeah, it's
11 absolutely -- I mean, without these volunteers, I mean, the
12 Commonwealth would pay billions of dollars, to say the
13 least.
14 REPRESENTATIVE DUSH: Absolutely. Thank you.
15 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
16 Representative Phillips-Hill.
17 REPRESENTATIVE PHILLIPS-HILL: Thank you, Mr.
18 Chairman. Commissioner, thank you so much for being here.
19 Thank you for keeping our communities in Lancaster County
20 safe.
21 So to follow up on Representative Neilson's line of
22 questioning, you know, who should make the cut? Right?
23 What minimum-duty contribution requirements do you recommend
24 to clearly define which members should be eligible under
25 this law for workers' compensation coverage? 21
1 MR. HAGELGANS: Well, it may seem very simple.
2 But, I mean, the reality of it is, somebody that's
3 physically doing something to better the fire company. So
4 that's somebody that responds to calls, somebody that does
5 fundraising, somebody that does administrative work, I think
6 those are the three categories that truly help the
7 organization.
8 Somebody donating money or coming into the social
9 club, you know, and sometimes the social club is also by the
10 active members; but somebody that's strictly a social
11 member, I think, would not be under this law and I think
12 that that's clear.
13 REPRESENTATIVE PHILLIPS-HILL: Mr. Chairman, if I
14 may?
15 MAJORITY CHAIRMAN KAUFFMAN: Sure.
16 REPRESENTATIVE PHILLIPS-HILL: So, generally
17 speaking, what type of other duties do municipalities
18 authorize volunteer emergency response organizations to do?
19 Right? Because there's that catch-all clause in the law
20 that says performing any other duties as authorized by the
21 municipality. So what types of duties are you authorized to
22 do, in addition to responding to that call?
23 MR. HAGELGANS: So certainly fundraising is the
24 number one thing, and that is very broad. I mean, from
25 chicken barbecues, to doing a standby at an event where 22
1 they're paying you, traffic control, you know, our fire
2 police are sworn in at the local magistrate; and if a local
3 agency's going to have a large event and they have a lot of
4 traffic issues, they'll bring our fire police out to help
5 keep the streets safe, which then allows our law-enforcement
6 officers, obviously, to do other duties and not direct
7 traffic and then, of course, the administrative duties.
8 I mean, we are getting paperworked to death. On a
9 Wednesday night, we may have six to eight members that
10 strictly come in and help us with paperwork because there's
11 so many requirements and if we don't meet them, you know,
12 we'll get an issue with a workers' comp case where they'll
13 go, Oh, you didn't do this paperwork. You know, the amount
14 of paperwork -- we just got -- we have our first FEMA grant,
15 thankfully; but the amount of paperwork they just explained
16 to us that has to be done and if you don't do all this
17 paperwork, they'll not give you the money or they'll take
18 the money back.
19 So, you know, when we're advertising right now in
20 Lancaster County, we're advertising for anybody that can
21 come help us accomplish any of these missions, which doesn't
22 have to be firefighting. It can be administrative; it can
23 be fire police; it can be directing traffic.
24 So I think, you know, from our municipal
25 standpoint, we authorize those things every year because the 23
1 law stated that we as the municipality -- I say we,
2 collectively, had to say that we could have our what we call
3 our tomato festival; we could have bingo; we could direct
4 traffic at these large events, so we had to define all those
5 things.
6 And the law said we had to do that, and we would do
7 that every year only to find out now that, who cares? And,
8 again, I'm not blaming SWIF. SWIF knew nothing about the
9 volunteer fire service. I mean, when we had our first minor
10 claim, we had to explain to them that a volunteer was an
11 employee, by law. It's like, you need to know this.
12 This is, you know, 101 legislation here on the
13 Workers' Comp Act. We had to explain to them that, you
14 know, a volunteer is entitled to statewide average wage.
15 Like SWIF who is -- and, again, they got kind of thrown into
16 this, I get that; but they didn't understand the law. We
17 kind of had to explain it to them.
18 But, yeah, anything that entails the betterment and
19 furtherance of the organization other than just giving a
20 donation. And I think that's probably the way to best
21 describe it; a social member is really giving a donation,
22 and anybody else is working for the organization.
23 You know, we had a gentleman yesterday in Lancaster
24 County; because we have a website where we're soliciting new
25 volunteers; and he said, I'm 70; I'm retired; and what can I 24
1 do to help? He could come into that local volunteer fire
2 company and do administrative work that will help free up
3 time for some active member to go do training or run fire
4 calls, because that's where -- we're beating people up on
5 time. There's so much time requirement.
6 REPRESENTATIVE PHILLIPS-HILL: Thank you.
7 MR. HAGELGANS: Thank you.
8 MAJORITY CHAIRMAN KAUFFMAN: Thank you,
9 Commissioner. Your testimony has been very valuable this
10 morning. I appreciate you taking the time to be with us.
11 And at this point, I don't think we have any other
12 questions; so thank you for your time this morning and we're
13 going to move on to the next panel.
14 MR. HAGELGANS: Thank you.
15 MAJORITY CHAIRMAN KAUFFMAN: Our next witnesses to
16 come forward -- we had asked SWIF and Delaware Valley Trust,
17 who are both major insurers from municipalities and
18 volunteer emergency services; we asked them to be here
19 today, but they couldn't make it. So they have both
20 provided written testimony, and so that should be in your
21 packet.
22 However, we do have Sam Marshall, President of the
23 Insurance Federation of Pennsylvania, as well as William
24 Taylor, President of the Pennsylvania Compensations Rating
25 Bureau. So I will turn it over to you fine gentlemen, and 25
1 you can give us your summary and then we'll open it up to
2 any questions folks may have.
3 MR. MARSHALL: Sure. Thanks for having me. Sam
4 Marshall with the Insurance Federation. And, you know, we
5 appreciate the goal, that everybody who volunteers should
6 have some form of coverage. I mean, frankly, whether it's
7 firefighters or a lot of other community organizations, you
8 know, one can say the same thing.
9 But certainly with fire companies and ambulances,
10 they are sustained and they require the volunteer efforts of
11 more than just the people who are putting out the fires or
12 responding to the accidents. Those other volunteers and the
13 work they do are important, I mean, and far less risky.
14 But they need to be encouraged, and that would
15 include having relief if in the course of doing those
16 volunteer activities they might get hurt. I'm not sure that
17 giving all of those volunteers firefighter status and
18 workers' comp coverage may be the best approach necessarily.
19 I think it could become, you know, considerably costly for
20 the volunteer fire companies and ambulance corps, especially
21 given the law's presumption on, for instance, Hep C and
22 certain forms of cancer as being work related. Because
23 they're caused by, you know, putting out fires; but, you
24 know, for other volunteers, that might not be a wise or a
25 cost-efficient expansion. 26
1 I think, as you address this, a couple of
2 considerations, and I was just looking at it as we often do,
3 you know, from my own perspective; but, you know, a person
4 volunteering, whether it's for his local fire company or his
5 church or whatever community activity it may be, often has
6 other forms of coverage for protection. He may have health
7 insurance to pay for medical costs. You know, most
8 employers will continue to pay for a sustained period of
9 time if the person is hurt while volunteering, much the same
10 as if you're hurt mowing the lawn on the weekend. You will
11 get -- many people will have -- you know, your employer will
12 continue to pay you while you're recovering. You may have
13 disability coverage, as well.
14 You know, those would be avenues that certainly for
15 the volunteer organization would be preferable in terms of
16 covering their volunteers than they paying for it through
17 workers' comp. And for the person injured, it may be
18 greater relief, as well. You know, if that person's own
19 coverage weren't enough, you know, most organizations,
20 whether they be fire companies or other outfits, do have
21 commercial general liability policies that that would cover.
22 I mean, for instance, if somebody is at a church
23 fair or a fire company fair and hurts themself, there may be
24 a claim against that commercial liability policy. Now,
25 those are -- that's a safety net, as well as workers' comp, 27
1 if you're going to expand workers' comp; but that's a safety
2 net, and I think there could be gaps. You may have a
3 volunteer who doesn't have his or her own health coverage
4 or, you know, the employer's not going to pay if the person
5 misses work. I mean, it might be a lot of different
6 scenarios. They might not have disability insurance and
7 things like that, and there may be entities, whether they be
8 fire companies or other volunteer outfits, who don't have a
9 commercial general liability policy that would also be able
10 to step in.
11 And that might be where you want to expand the
12 workers' comp coverage here. I do think, though, that you
13 want to check that before you do a significant expansion of
14 volunteers for fire companies, particularly when you go
15 outside of the risk that is presented when you're putting
16 out a fire as opposed to when you're doing administrative
17 work.
18 You know, the risk of Hep C, if you are an
19 ambulance person who's dealing, you know, physically hands
20 on dealing with patients is different than the risk if
21 you're doing administrative work back at the ambulance
22 office.
23 I do think, you know, you also want to look at the
24 types of volunteers we're talking about here in the broader
25 context of volunteers, generally. You know, I appreciated 28
1 Representative Dush's comment about fire companies being
2 integral to a community, but you can -- so are a number of
3 other activities. You know, firefighting itself is a unique
4 activity. But whether you're working the grill for the
5 church fair or the fire company annual fundraiser, either
6 way it is important to the community and it's important that
7 if you are hurt, you have some form of recompense.
8 We hadn't really thought about it until, you know,
9 this bill came along. But looking at volunteer coverage
10 just generally is probably an important thing to do. I
11 think -- you know, I am sensitive. As insurers, we used to
12 do a lot in the fire company area. We lost the business as
13 insurance companies. We actually lost it to these
14 self-insured trusts that a lot of the fire companies came up
15 with.
16 You know, they realized -- I think a lot of them
17 have realized over time, it's not that easy being an insurer
18 and they -- you know, particularly seems like Hep C and
19 cancer presumptions came in and they withdrew from that
20 business and it's gone over to SWIF.
21 And that's -- you know, I can have some competitive
22 comments about SWIF. You know, it's -- you're dealing with
23 -- when you're dealing with volunteers and you're dealing
24 with, whether it's fire companies and ambulances or others,
25 you're dealing with some tough areas in terms of 29
1 underwriting and risk assessment and risk grouping. You
2 know, it's an important issue, particularly for fire
3 companies and other volunteer organizations. I'm not sure
4 that extending workers' comp is going to be the answer for
5 everybody, particularly for those who have other forms of
6 coverage already; but we're happy to work with everybody on
7 a solution.
8 I was impressed with the Commissioner before me.
9 After this, I'd like to sort of sit down with him and learn
10 more from his perspective.
11 Thank you.
12 MAJORITY CHAIRMAN KAUFFMAN: Thank you, Sam. And
13 Representative Keefer has entered the room since we did our
14 roll call.
15 Bill, you're next.
16 MR. TAYLOR: Thank you. Good morning, Chairmans
17 Kauffman and Galloway, Representative Hill, Committee
18 members and Committee staff. I appreciate this opportunity
19 to testify before the Committee regarding House Bill 1909.
20 I'm president of the Pennsylvania Compensation
21 Rating Bureau. I won't go into all of what we do, but I
22 think most of you are familiar with that; but I'm open to
23 any questions you may have regarding our responsibilities
24 for the workers' compensation system in Pennsylvania.
25 I want to also acknowledge Sam and the Commissioner 30
1 on the comments. I'll try not to be redundant with
2 statements already made, some of which are contained in my
3 testimony. I'll just jump to a few key points recognizing
4 this legislation.
5 Like everyone here, I recognize and we recognize
6 the value of the volunteer fire community. Whether it be
7 fire companies or ambulance and emergency services, we do
8 oversee and track those activities within our organization.
9 Just a little background on workers' compensation
10 premium calculation, it's important to note here that losses
11 for rate making and experience rating are historically
12 measured by payroll for most other classes. Payroll is used
13 because it has a reasonable correlation with losses, and
14 they can be reasonably audited and validated against other
15 documents that are reported to the state.
16 For certain classifications like this one, it is
17 not the best or available determinant for calculating
18 exposure and the development of the associated rate or loss
19 cost.
20 So for these individuals, payrolls not available
21 for purposes of the exposure or rate making and thus we use
22 population as a means of estimation on the exposure and the
23 ultimate loss tracking allowed for rate loss cost
24 calculation. Thought that was worth mentioning, as it's a
25 fundamental aspect and a difference versus most of the rest 31
1 of the system.
2 From a classification assignment perspective, we
3 use Code 994 for volunteer fire companies, volunteer firemen
4 and 993 for emergency services, ambulance corps. In both
5 instances, we do use population as the rating basis. So we
6 use those two codes to track and manage the risk of those
7 exposures, and we develop the annual premium loss costs
8 accordingly from the data reported to us on an annual basis
9 for those calculations.
10 One of the key terms that's used and has been used
11 a few times already this morning is the concept of certain
12 activities. I want to just speak to that for a moment. A
13 few commonly and frequently used terms with the word
14 volunteer in our manual and other jurisdictions around the
15 country to define that exposure, volunteer, they're usually
16 coupled with the words firefighters, firemen, fire policy,
17 and ambulance corps.
18 Along with those words, you'll see phrases --
19 you'll often see the phrase, certain activities, to further
20 define that the coverage exposure is limited to certain
21 activities associated with the underlying terms of
22 firefighting or emergency services work.
23 Nationally, there's actually quite a bit of
24 commonality on the definition, as I'm indicating here, for
25 volunteer firefighting, emergency medical services. A 32
1 standard phrase you'll see, and I'm quoting here now from my
2 testimony, volunteer firefighters and/or ambulance services
3 applied to firefighting or ambulance employers that provide
4 services for the protection of the public.
5 Examples of fire protection services provided by
6 firefighting crews include, but are not limited to, fire
7 suppression, emergency first responders, emergency medical
8 services, EMS, technical rescue, urban search and rescue,
9 hazardous materials, response, and fire education and safety
10 efforts.
11 So as you see, it is a broad definition, but does
12 leave out some of what was talked about here today. Within
13 that testimony, I also list -- it goes along with that
14 definition, a listing of equipment and materials often
15 referred to as it relates to the work involved with what I
16 just mentioned.
17 So this is just standard quoting and just trying to
18 illustrate that throughout most of the country, this other
19 type of volunteer work isn't often defined; and it's a point
20 well taken, but it's often not defined.
21 We're all recognizing that these are volunteers and
22 not employees. I have a few exhibits to illustrate how we
23 at the PCRB specify Codes 994 and 993 and the phrases we
24 use. So, in summary, the expected exposure of these codes
25 is based on the activities and work performed as 33
1 firefighters or emergency services personnel. It does not
2 contemplate other volunteer services, such as clerical or
3 certain types of maintenance work and support of these
4 functions or related municipal work.
5 This bill broadens the definition of member,
6 expands the underlying basis of the risk exposure. The PCRB
7 is unable to estimate or establish the cost associated with
8 this increased exposure. This is due to the fact that these
9 classifications, 994 and 993, are based on population and
10 not payroll.
11 The premiums presented presently calculated will
12 not change, even with the added exposure; and I have a
13 history of our loss cost for five or more years as an
14 exhibit.
15 So, in summary, the PCRB is not in a position to
16 recommend or reject the merits of the suggestion for
17 expanding or broadening the meaning and definition of
18 volunteer members, as the PCRB is unable to quantify
19 sufficiently at this time the impact it may have on these
20 classifications.
21 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much.
22 And now I'll open it up to questions, and Representative
23 Topper's going to start things off.
24 REPRESENTATIVE TOPPER: Thank you, Mr. Chairman.
25 Mr. Marshall, you have in your comments that you submitted 34
1 which you summarized, that this could be especially costly
2 for volunteer fire companies, ambulance corps, especially if
3 the loss presumptions of certain cancers and Hep C as
4 occupational illnesses are carried over, which is my concern
5 as well.
6 The cancer presumption has already caused us, you
7 know, and caused local departments quite a lot of money.
8 You said, especially if. So are you not sure whether this
9 bill would include that? Could we put something in the bill
10 that specifically said this would not carry over to extended
11 volunteers, or what do you think when it comes to the cancer
12 presumption law?
13 MR. MARSHALL: I mean, I would think that you would
14 want to expressly exclude those presumptions to -- and I
15 think your phrase is correct on it, to extended volunteers.
16 REPRESENTATIVE TOPPER: Uh-huh.
17 MR. MARSHALL: Because the cancer presumption and
18 the Hep C presumptions were borne because those are
19 exposures that happened when you're actually putting out the
20 fire, when you're actually handling the, you know,
21 potentially drug-addicted person in an ambulance setting,
22 you know, that that was the genesis of the Hep C.
23 If you are, you know, doing administrative work,
24 what we're calling extended volunteers, that wouldn't -- it
25 wouldn't make sense that that is a risk that is exposed with 35
1 what is associated with what you're doing. So I would think
2 that at least you would want to cut that out so that you
3 don't have a situation of a person who, you know, is
4 volunteering doing administrative work and for whatever
5 reason, you know, tragically comes down with either Hep C or
6 one of the cancers and says, hey, that's work related.
7 REPRESENTATIVE TOPPER: Yeah. I mean, like I said,
8 I've always -- and I've heard from back in the district
9 that's -- you know, I understand why the law was put into
10 place; but it also can be very, very difficult. To expand
11 that, I would be concerned.
12 I mean, I feel like there's a distinct difference
13 between, you know, a couple of the examples that were given:
14 directing traffic at the scene of an accident versus burning
15 your hand while making a hot sausage sandwich. While
16 they're both -- you know, I can see the injury in both.
17 I mean, I think we do need to have not just a
18 classification in terms of benefits and who qualifies for
19 them, but maybe possibly what is, you know, the acts that
20 are where the injury is incurred. I just think we have to
21 look at that, but especially the presumption. If we could
22 make sure that we get that out of there, I think that would
23 probably help.
24 On the other hand, I mean, we do ask these
25 volunteer companies to do quite a bit and some of that does 36
1 involve hot sausage sandwiches or traffic or whatever and we
2 do need to figure that out. But I appreciate the comments
3 and the addition that you've provided.
4 Thank you, Mr. Chairman.
5 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much.
6 And next is Representative Delozier.
7 REPRESENTATIVE DELOZIER: Thank you, Mr. Chairman.
8 I should have -- I also want to follow up with the
9 Commissioner and ask him this, because I did not. But in
10 taking a look, Sam, at the Cancer Presumption Bill, sort of
11 going off what Representative Topper was just talking about,
12 the way that that was proposed and my understanding of it
13 is, that all the firefighters as they perform their duties,
14 have to log into a system the amount of hours that they
15 have; and that goes into the calculation when -- if there is
16 something that is needed to be claimed down the road, that
17 they have a certain amount of hours into the system having
18 accomplished fighting fires for six years or whatever the
19 duration may have been.
20 My question that comes kind of around to this is
21 the fact that -- and you had mentioned in your testimony
22 about the definition of a volunteer, and I appreciate that
23 because that was actually part of my question as to should
24 we be having a threshold when it comes to volunteers, not
25 only for the tax, as Jessie was just mentioning, the 37
1 description of the tax, but actually how many hours of a
2 volunteer has served that particular fire company.
3 And my question would go to the ability to say if
4 somebody volunteers for one day at the carnival and they're
5 injured, do they receive the same type of benefits that a
6 firefighter would get if they were injured in a fire and
7 that type of thing.
8 So I know with the preemption, we set thresholds as
9 to the amount of hours that had to have been logged in to be
10 considered. You know, so many of our volunteer
11 firefighters, the amount of hours that they served, did they
12 actually fight fires when we're dealing with cancer and go
13 into a burning building, or were they directing traffic and
14 so they were not exposed to something with a fire. That was
15 a big debate when we had the preemption bill. So should
16 that be transferred over for a volunteer? How many hours
17 had they volunteered as well as defining the tasks that
18 they're doing.
19 So I'm asking kind of your feedback as to the fact
20 of should this be delineated as it was in the preemption
21 bill?
22 MR. MARSHALL: You know, my standard insurance
23 answer would be, no --
24 REPRESENTATIVE DELOZIER: Okay.
25 MR. MARSHALL: Because, you know, a person is a 38
1 volunteer whether a person is in the first hour of
2 volunteering or the hundredth hour or the thousandth hour.
3 But where you raise a point that I think here with
4 volunteers is important to consider, many volunteers already
5 have, as I mentioned -- I mean, I speak -- personally, I
6 have health insurance. If I'm volunteering at the church or
7 I'm volunteering at the local firehouse and I slip and fall,
8 my health insurance covers that.
9 You know, from the fire company's perspective or
10 our church's perspective or the Little League's perspective,
11 better that my health insurance is covered than the fire
12 company has to pick up the cost of that.
13 By the same token, if I get hurt and I miss time
14 from work, as a result, the Insurance Federation will cover
15 my lost time up to a certain point, I guess. But better
16 that the Insurance Federation picks up that than the
17 volunteer fire company picks up that.
18 So, you know, one of the things -- now, that's why,
19 and I don't have an absolute answer; but I think, yes, you
20 want to encourage the volunteers and you want to encourage
21 them on the first day they volunteer, as well as, the
22 hundredth day they volunteer. And encouraging them means,
23 hey, if you get hurt, you're going to have -- you know, it's
24 going to be covered.
25 But I think you want to balance that with making 39
1 sure that the volunteer organizations don't get hit with a
2 new expanded cost. And, you know, to the extent that many
3 volunteers, particularly in those administrative aspects,
4 will have other forms of coverage if they get hurt.
5 Probably from a volunteer organization's perspective,
6 probably want to make those other forms of coverage primary
7 and the volunteer organizations secondary.
8 Don't know exactly how to craft that, and I also
9 don't know, you know, this would be a point of inquiry; but
10 volunteer organizations, what their commercial liability
11 policies are. They would all have them, you know, for the
12 most part. Even on one-day events you get special-event
13 insurance, and it's a question of how those policies work.
14 You know, Representative Phillips-Hill mentioned,
15 you don't want people to have to wait nine months for a
16 claim, I mean, because that's not the way the bill works. I
17 don't have the answers today, but we need to take a deeper
18 look.
19 But you want to make sure volunteers have coverage;
20 but at the same time, you don't want to make it so expensive
21 for the volunteer organization that it says, you know, I
22 can't afford to have volunteers. You know, that's not the
23 goal, obviously.
24 REPRESENTATIVE DELOZIER: Okay. Thank you.
25 MAJORITY CHAIRMAN KAUFFMAN: Thank you. 40
1 Representative Maloney.
2 REPRESENTATIVE MALONEY: Thank you, Mr. Chairman.
3 This is a really interesting discussion here. I think so
4 much of this goes back to the fact that we really rely on
5 our volunteers for so much. As I've often stated in my
6 community, without the volunteers, America wouldn't be what
7 it is.
8 And so I heard a lot today about gaps, other
9 coverage. Sam, you just mentioned several different things
10 that I think are rather interesting. I come from an
11 industry of construction that we often felt that we were,
12 you know, overinsured and not really sure even what we were
13 covered for.
14 So I think what's interesting is the fact that
15 we're having this discussion and most times this definition
16 of volunteer is what's the question. And so we can have
17 firefighters, ambulance providers and whatnot in our
18 community that are paid employees to either the borough or
19 township or whomever and that doesn't seem to be a question,
20 because they are an employee.
21 But when we move to the volunteer definition, I
22 think what keeps coming up is that who was a volunteer and
23 what's the importance of what you're doing. And so I think
24 for me, as you said, there's some unknowns here, some
25 challenges as to who gets covered for what. 41
1 Many times we get asked or almost forced into an
2 umbrella policy on many things that we do that you would
3 think would cover some of those things, and I'm not so sure
4 I'm hearing that today.
5 And so other coverages come into my mind about what
6 you may or may not have been doing to now need that service,
7 and so that's why I think when other members brought up
8 administrative, it would be somewhat challenging to me to
9 how we would classify duty when you would have firefighters
10 who have been trained, who have experience, possibly
11 decades, they have moved into the administrative services
12 that are needed. Some of the younger bucks have moved up to
13 do some of the hard work and then that individual goes and
14 does something and you say, well, because you're
15 administrative, you're not covered.
16 And so that's why I think I've actually raised more
17 questions in my mind as to how we do classify and those gaps
18 of coverage from where you may be insured from somebody for
19 something else but then when you go to file that claim it's,
20 well, that doesn't qualify.
21 So -- I see your hand going up there. I would like
22 --
23 MR. TAYLOR: I was just going to make a comment
24 regarding the aspect of administrative and clerical. There
25 are municipal policies which have the volunteer firemen 42
1 included on their policy, where the volunteer firemen or
2 ambulance service can be a separate policy. Either is fine.
3 But often, especially in the municipal example, they will
4 have a clerical delineation; and that has the clerical, very
5 low loss cost associated with that.
6 Again, though, based on payroll, but there may be
7 ways to identify the administrative side that wouldn't have
8 the higher loss costed rate that the 994 or 993 actually
9 have. So there probably needs to be a mechanism to better
10 isolate the administrative/clerical activities so that it
11 has a fairer rate associated with it. That's an opinion.
12 That's not a --
13 REPRESENTATIVE MALONEY: Yeah, I understand that,
14 and I appreciate that. But I guess to really summarize this
15 for me, going back to the fact that we're in all of these
16 classification issues and gaps and discussion is basically
17 because we're looking at the difference between somebody
18 who's employed and somebody who's a volunteer; and I think
19 we all know that.
20 But to not be able to delineate in what and who has
21 value in how you get covered for that service you're doing,
22 I think is why we're having this discussion today as to how
23 we clear that up.
24 MR. MARSHALL: But I think in addition to that, we
25 are among -- you're right that initially there's a, you 43
1 know, okay, employee versus volunteer; but we're also
2 talking about different types of volunteers and, you know,
3 significantly different risk factors in what they're doing.
4 You know, what firefighters and ambulance
5 responders do as volunteers, I tip my hat, you know, because
6 they're risking life and limb, not for recompense, but
7 simply to serve the community.
8 That's a great quality and it's a unique quality.
9 I mean, when you think --
10 REPRESENTATIVE MALONEY: And I guess one of the
11 reasons that I was bringing that up is because they cross
12 over themselves.
13 MR. MARSHALL: Correct. But one of the challenges
14 in terms of saying, okay, volunteer organization, you now
15 have to also -- and right now volunteer organizations, you
16 know, the fire companies or the ambulance companies, provide
17 them with workers' comp coverage, medical and indemnity
18 benefits.
19 When you extend that, not just to those who are
20 actually firefighting but, you know, those who are doing
21 administrative work, I understand that it will come at a
22 cost. And my only concern is, make sure as you do that,
23 those other volunteers, the administrative volunteers, are
24 the types of volunteers who serve churches, who serve
25 Little Leagues, who serve any number of community 44
1 activities. Very important, very vital. You know, it's the
2 type of work that I do. I'm not risking life and limb when
3 I'm helping out with my church. I'm donating my time and my
4 intellect and, you know, some level; but it's not dangerous
5 work. It's what it is.
6 REPRESENTATIVE MALONEY: Right.
7 MR. MARSHALL: I don't know that that volunteer
8 organization wants to take on my costs if I have other
9 coverage available.
10 REPRESENTATIVE MALONEY: And I understand that.
11 And I think one of the things that comes to my mind from the
12 maintenance perspective is the fact that you could have --
13 and I noticed this one list about, you know, equipment and
14 materials, but the activities, I think, keeps coming up in
15 the fact that you can have these fellas that are not only
16 working on the trucks but they could be working on the
17 building, you know.
18 There's things that they do that do put themselves
19 at somewhat of a risk. But if they didn't do it, they might
20 as well close up shop because they couldn't afford to
21 continue to have, you know, that added expense; so that's
22 kind of why I was trying to be cautious about who we value
23 and how we put that in a classification.
24 MR. MARSHALL: And you're right, because there are
25 people who will go and they may not go put out fires, but 45
1 they work around the building, they do some form of
2 construction work, and that carries its own risk. You know,
3 my concern -- and they should have coverage if they get
4 hurt.
5 What I'm advising, recommending, is that as you go
6 forward with this, because you don't want to impose a unique
7 new cost on the volunteer organization that it can't handle.
8 You know, that goes --
9 REPRESENTATIVE MALONEY: Well, a lot of that's
10 controlled by the insurance company, too. I mean, that's
11 how you guys value what you're going to insure.
12 MR. MARSHALL: But, you know, frankly, that's why
13 you have a -- I mean, you know, the experience dictates what
14 the rate's going to be. You know, we don't put the price on
15 it. You know, we just reflect the cost.
16 And, again, that goes to what Representative Topper
17 talked about. You don't necessarily want Hep C or certain
18 cancers to be presumed for the fella doing work around the
19 house. You may have that person doing work around the
20 firehouse has other forms of coverage, you may want to save
21 that to hold down the cost of the volunteer fire company.
22 We'll have those other forms of coverage be primary.
23 REPRESENTATIVE MALONEY: Right. Thank you.
24 MAJORITY CHAIRMAN KAUFFMAN: Thank you.
25 And Representative Phillips-Hill. 46
1 REPRESENTATIVE PHILLIPS-HILL: Gentlemen, thank you
2 very much. And I do want to clarify that I don't think we
3 need to extend the cancer and Hepatitis C coverage to
4 auxiliary members who are doing other types of activities.
5 Right? They're not having the exposure, as you stated.
6 These have been great questions, and I really appreciate you
7 helping us to work through these issues.
8 One of the things that, as you were talking, came
9 to mind was, what I'm being told by my volunteer fire
10 companies back home is that prior to the Legislature putting
11 the Hep C and the Cancer Presumption into the law, all of
12 these things had previously been covered. Right? So I'm
13 helping out at my local volunteer fire company. It's bingo
14 night, where bingo's a great fundraiser for volunteer fire
15 companies, and my hand gets crushed in a door and I need
16 surgery. Right? Previously, that would have been covered.
17 If you, who have your insurance through your employer, are
18 walking down the hall of the Capitol and you come into this
19 hearing room today and your hand gets crushed, the insurance
20 that your employer provides you would cover that, correct?
21 So I think what they're really looking for is to
22 restore the coverage to what it was prior to that and have
23 things that have traditionally been covered continue to be
24 covered. So in thinking this through, is it possible that
25 we could establish a new classification or a 47
1 subclassification that would establish a separate rate
2 because they are lower-risk members. Right? They're not
3 out there fighting fires, facing those kinds of higher
4 risks; but they could still face risk.
5 And, you know, when you're doing this activity, if
6 you were doing it for that employer that provided that
7 health insurance coverage, it would be covered; but they
8 don't have that same type of coverage. Is that a
9 possibility?
10 MR. MARSHALL: Yes. But going to your point, and
11 one of the things that I think you need to think about, if I
12 crush my hand volunteering for my fire company doing
13 administrative work, my employer will cover that. It's not
14 just if I crush it on the door here, if it's I crush it on
15 the door at the firehouse or if I crush it playing golf, you
16 know, my health insurance policy will pick that up.
17 You know, that -- in terms of holding down cost for
18 the volunteer fire company, if I hurt my hand while I'm
19 working at the firehouse, I mean it's a policy decision that
20 you all ultimately make. Do you want that to be a cost for
21 the fire company or a cost for my health insurer?
22 And that's something -- I mean, that's just a cost
23 that the volunteer organizations are going to have to
24 wrestler with. Right now, they get some way, shape, or
25 form, some sort of a subsidy from everybody's regular health 48
1 insurance. That's not, you know, where they have it.
2 That's my point about, you may want to impose on the
3 volunteer outfits, you may want to have them be the failsafe
4 and the safety net but you may not want to impose on them
5 the burden of being the initial safety net.
6 REPRESENTATIVE PHILLIPS-HILL: Right. Very good.
7 One last thing, if you could help me understand
8 this, the fire commissioner who testified, talked about the
9 great increase in the premiums since Act 46, as well as the
10 fact that they're paying over 21 million in premiums and
11 only receiving 3 million in claims.
12 Is there a broader issue at hand with other claims
13 not being paid with regard to the SWIF fund in our fire
14 companies?
15 MR. MARSHALL: You'd have to -- I can't speak for
16 SWIF, and I'm disappointed that SWIF declined to be here.
17 SWIF will handle itself. You know, because from a
18 commercial insurers, and that's who I represent and that's
19 part of the business I know, we were not -- I mean, as I
20 mentioned earlier, we had lost business to all of the small
21 trusts that had formed that I think the previous
22 commissioner had mentioned that's who had covered him in the
23 past.
24 Because of that Act, they went out -- I don't know
25 that the SWIF members -- I can't speak to them about whether 49
1 they had taken in 21 million and paid out 3 million. That
2 would not be consistent with the SWIF balance sheets that
3 I've seen generally, but I don't know in this particular
4 area. But that's something you should follow up with SWIF
5 on. Sometimes, of course, somebody may say, yeah, they paid
6 out 3 million so far but they've had to hold back in reserve
7 for the potential of these claims coming out four years from
8 now a certain amount of money.
9 REPRESENTATIVE PHILLIPS-HILL: Right. Thank you.
10 MR. MARSHALL: It's not a pay-as-you-go -- and
11 insurance shouldn't be a pay-as-you-go basis.
12 REPRESENTATIVE PHILLIPS-HILL: Understood.
13 Thank you very much.
14 MR. TAYLOR: If I could add a little bit to that?
15 I think there was a definitive major shift after the Act 46
16 implementation in 2011. SWIF had roughly 12 percent of the
17 market, and it's up there approaching 70 percent of the
18 market now. So what you're really pointing to here is that
19 the voluntary market no longer has an appetite for this
20 volunteer firefighter or EMS service.
21 That's unfortunate, because it's served in a little
22 differently than SWIF may -- SWIF handles it well. They
23 handle it conventionally. But in the voluntary market,
24 there is some latitude. Claims are evaluated or
25 adjudicated, that might be why your comment that it was 50
1 covered before. The coverage aspect is no different now
2 than it was then, just to be clear about that. It's really
3 on the interpretation of this term member. And I think
4 there's some latitude there.
5 So with the cancer legislation, the voluntary
6 market is just -- is scared off of wanting to have this
7 business on their books, in addition to the trust aspect as
8 well; so it would be healthier if it wasn't all with SWIF.
9 That's not really the intention of a free market,
10 but SWIF is the market of last resort and they're doing
11 their best they can with the business, is my understanding.
12 Their premiums are in excess of -- I'm not sure of the total
13 premiums they have right now. It's back to 2014. But it's
14 in the range of 15-plus million, and they have reserves well
15 in excess of 10 million for claims; so it's not that out of
16 skew as it may have been reported earlier.
17 REPRESENTATIVE PHILLIPS-HILL: Thank you.
18 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much.
19 Representative Neilson.
20 REPRESENTATIVE NEILSON: Thank you, and thank you
21 for bringing it up because it's something I wanted to
22 clarify because exposure in these cases that are covered
23 under Act 46 doesn't happen for 20 years from now. It's not
24 something, Hey, look, I fought a fire today and I get cancer
25 tomorrow or something like that; so those funds have to be 51
1 available at SWIF for future claims. It's not so much
2 claiming today, it's about tomorrow; and their exposure's
3 still there.
4 A couple questions: Mr. Taylor, you mentioned that
5 you do the rating by population. So if we cover these
6 volunteers or whatever we cover underneath this legislation,
7 the premiums will not change nor will the ratings. The
8 ratings don't change. The ratings, I believe, is set on the
9 premium. That helps set the premiums. And you're saying
10 that won't change. How could that not change?
11 MR. TAYLOR: Yeah, that was my statement and it's
12 in my conclusion. That's why we can't really estimate the
13 cause of the cost effect of this, except over time when
14 claims may increase or may -- I mean, we don't know how much
15 of an added increase in claims we may have from the added
16 exposure. But as of now, the premium is the premium for
17 that jurisdiction, based on population.
18 It will only change over time the loss cost,
19 because it's not based on payroll.
20 REPRESENTATIVE NEILSON: So to run a fire company,
21 any kind of organization like that, you know, you have 20
22 people fighting fires and you have another 100, 200 people
23 that support them, is there a way we can like -- do you
24 think we should look at this in a different way and say,
25 look, the firefighter's a firefighter; however, you still 52
1 have to have insurance for the -- like, Sam, I think you had
2 said liability insurance. Most fire companies have
3 liabilities, someone slips and falls out front. I mean,
4 some kind of policy because then your population number will
5 go down because now you only have 20 firefighters or 30 or
6 40, whatever that number and they would have to be
7 registered or whatnot.
8 Even though it's an organization of 300, you only
9 actually have 40 doing the actual activities of a -- I mean,
10 that has to help on premiums; because this gentleman
11 testified earlier, from 12,000 to 70,000 a year, that's a
12 lot of money.
13 MR. MARSHALL: And, you know, you also go into what
14 Representative Topper referred to, probably a fair shorthand
15 description for today, extended volunteers, what we'll call,
16 you know, that don't do the core activity, but do essential
17 activities, whether it's raising money, working around the
18 firehouse, doing those things. And you may want to create a
19 distinct category for them, because they have a different
20 risk profile.
21 Easy for me to suggest it, because I'm just
22 throwing the ball over to Bill, because he's going to have
23 to do it. But it's also -- it goes to the question of
24 primary versus secondary liability.
25 REPRESENTATIVE NEILSON: And that would help on the 53
1 overall ratings/premiums they're being charged, right, if
2 that was separated as such? Because right now -- I'm just
3 trying to grasp this to make sure I grasp it right, 200
4 people at a volunteer fire company, that's what you're
5 basing your insurance on, like every one of them's fighting
6 a fire. Am I correct in assuming --
7 MR. TAYLOR: Now, especially when it's a separate
8 independent policy, not part of the municipality's policy;
9 and it's a mixed bag as to how that's done municipality by
10 municipality.
11 Sometimes when the municipality does it, they'll
12 use the code and that code itself is based on population;
13 but the rest of their policy is based conventionally on
14 payrolls within the municipality. So it covers it in a more
15 comprehensive way and probably has less gaps than when it's
16 an independent policy.
17 REPRESENTATIVE NEILSON: Do we have any inclination
18 of how many municipalities cover these volunteer fire
19 departments? I mean, maybe we're looking at this the wrong
20 way. Maybe we can see how they can save money by requiring
21 municipalities to cover other volunteer fire companies.
22 MR. TAYLOR: I do have statistics on that. I know,
23 roughly, as of now, we have about 1500 stand-alone volunteer
24 policies; so I don't know how many volunteer fire companies
25 we have throughout the state, but many are also part of a 54
1 municipal's policy.
2 REPRESENTATIVE NEILSON: Because it would seem
3 municipalities would want this. I mean, this is a service
4 for them. This helps them, as well. And maybe if we
5 require the municipalities to provide the insurance or
6 coverage, maybe that will help them a little bit offset
7 their costs. It's just a thought.
8 I mean, this discussion's going good; because I can
9 see the questioning's going all over the place. We're
10 really trying to dig into this. I look forward to facing
11 this issue next year.
12 Thank you, Chairman.
13 MAJORITY CHAIRMAN KAUFFMAN: Thank you. As a
14 township supervisor in my previous life, I came from a
15 township that did provide coverage to their volunteer fire
16 departments; so I remember dealing with that issue on a
17 regular basis as a township supervisor.
18 So last I believe we have is Representative Dush.
19 REPRESENTATIVE DUSH: Thank you, Chairman. Couple
20 quick things: First of all, I'd like to start off with, I'd
21 like to find out from SWIF if we can, Chairman, get an
22 actuarial report, given these numbers, $21 million in
23 collections and $3 million in payouts.
24 I understand that they have to offset for future
25 liabilities, but I want to find -- I would appreciate us 55
1 getting our hands on an actuarial report and find out where
2 they're putting that money.
3 Sam, you had mentioned -- actually, both of you,
4 Bill -- the variety of risks in underwriting these cases.
5 You both have underwriters going from actuarial tables and
6 things like the codes in 993 and 994. You got experience in
7 the industry with dealing with businesses that have equally
8 diverse ranges and risks, like a construction company with
9 clerical staff, a manufacturing business with clerical
10 staff.
11 I believe that those -- the similar type of
12 activity that would go into assessing those risks could very
13 easily carry over into doing so for the volunteer fire
14 companies.
15 As the Commissioner had stated earlier, they submit
16 to the municipality's requests for the things that are
17 authorized for their employees or -- well, their volunteers
18 to do, whether it's directing traffic for other
19 organizations on the part of the fire police, that sort of
20 thing.
21 I believe that those types of things are something
22 you've already got experience with as far as assessing those
23 risks and the exposure. And it would be something that
24 would carry over and allow those types of coverages to be
25 done with a minimal amount of burden, I think, to the 56
1 insurer.
2 Are there additional concerns, other than trying to
3 do those types of assessments and do the underwriting
4 actuarial duties?
5 MR. MARSHALL: Those are things that you would have
6 to do in taking on more risk. It's just, you know, we can
7 do it; it comes at a cost. And so I think the challenge in
8 this is how do you make sure -- you know, you want to
9 encourage volunteers; you want to encourage people to
10 volunteer.
11 How do you do that so that the volunteer
12 organization can continue to provide the services to the
13 community it does? How do you do that without imposing a
14 unique or -- you know, a cost that that volunteer
15 organization can't absorb?
16 That's the difficulty. We can put a price on it,
17 but that's why I note that with these extended volunteers
18 you may want to consider not having the coverage the
19 volunteer outfit provides for them be primary. It's primary
20 right now for the people who are actively fighting fires.
21 But if you were to apply that to extended
22 volunteers, you might want to make that secondary to any
23 other coverage they already have. That would be one way of
24 ensuring that they have coverage should they be hurt, but it
25 wouldn't be primary. That would hold down the cost for the 57
1 volunteer organization. Just one of the things to consider.
2 REPRESENTATIVE NEILSON: I agree with you on the
3 things like the Hep C and cancer presumptions; but there's a
4 significant difference between healthcare coverage that one
5 might receive from one's employer and having the employer
6 pick them up on a workers' compensation. If you're dealing
7 with lost wages and that sort of thing, there's a
8 significant difference between those two types of insurance
9 coverages.
10 And putting the primary responsibility on an
11 employer for workers' compensation type of claims would
12 possibly discourage the employer from allowing persons to
13 have the time off to do some of the volunteer work.
14 So we already have problems with filling
15 firefighter positions as it is, discouraging people from
16 doing other things associated with it. It could be a
17 problem, because some of our smaller employers, their
18 workers' compensation if they're in a service industry, for
19 example, and they've got a person who's volunteering as a
20 fire police, I've been hit by a car directing traffic myself
21 and it's -- that risk is significantly different than
22 somebody who's got a service industry that is strictly
23 geared towards sitting at a desk. So that employer's risk
24 and liability may go up as a result.
25 MR. MARSHALL: I understand that. I represent 58
1 those mean SOB insurance companies. That said, whatever
2 else we do, when we give you health insurance, we're not
3 saying, Gee, you know, on weekends we have one rate for the
4 guy that goes parachuting on weekends and another rate for
5 the guy that sits and reads. You know, we don't -- you
6 know, when you're charging a group rate, say, in an
7 employment-based coverage, you're not making those
8 distinctions.
9 You know, by the same token, most employers if
10 somebody is hurt mowing his lawn or working at the church
11 fair and he therefore misses a week because he strains his
12 back or whatever may happen, you know, the employer doesn't
13 say, you know, not covering you for time missing from work
14 because you hurt yourself volunteering in the community, as
15 opposed to working around the yard.
16 That's why I go into the point for volunteer
17 organizations in terms of holding down their costs. When
18 you're dealing with extended volunteers, you may want them
19 to buy coverage but it may want to be secondary to what
20 those volunteers already have.
21 REPRESENTATIVE NEILSON: I could possibly
22 understand that on a healthcare side. But as far as
23 workers' compensation, the workers' compensation loss wages,
24 that sort of thing, that would be something different
25 altogether; because the employer's not going to cover you 59
1 losing your wages for going out and working in your yard or
2 going out and working and getting injured volunteering for
3 your church or whatever.
4 Your employer's insurance is not going to give you
5 workers' compensation coverage for that. But when the --
6 just like the firefighters, there -- the people who are
7 doing the other things which are necessary to keep that
8 organization -- and they're a special class, and they're
9 recognized as a special class.
10 MR. MARSHALL: My point, and I don't think I made
11 it artfully; but, for instance, if you get hurt this weekend
12 working around your yard, the Commonwealth is still going to
13 pay your salary for a period of time. I mean, let's say you
14 miss a week because you're laid up because you hurt your
15 back working around the yard, you will get your next
16 paycheck, as will I.
17 Now, if we were both paid by the hour or if we were
18 paid on a commission basis or something like that, might be
19 different. That again, goes to the, do you make -- who do
20 you make primary, who do you make secondary? I mean, I'm
21 just trying to hold down -- I'm sensitive to the cost of
22 volunteer organizations, because we've heard, you know, and
23 correctly, we've heard a lot of volunteer fire companies
24 talk about the cost of, you know, the cancer and the Hep C
25 presumptions that have been imposed on them and we don't 60
1 want to add more costs on them.
2 REPRESENTATIVE NEILSON: Thank you very much.
3 MAJORITY CHAIRMAN KAUFFMAN: This has been a good
4 conversation. And I need to note, also, that Representative
5 Phillips-Hill, the prime sponsor of this legislation, has
6 long been committed to speaking at a breast cancer awareness
7 event out at the fountain. So, Representative
8 Phillips-Hill, thank you for being here; and you may go tend
9 to your duties elsewhere.
10 REPRESENTATIVE PHILLIPS-HILL: Chairman, Committee
11 members, thank you very much. Really appreciate it. Thank
12 you.
13 MAJORITY CHAIRMAN KAUFFMAN: Absolutely. And you
14 gentlemen are excused.
15 We're going to move on to our final witness here
16 this morning, Elam Herr, from the Pennsylvania State
17 Association of Township Supervisors. Elam is going to
18 provide testimony from the perspective of our
19 municipalities, and you may provide whatever information
20 you'd like us to have and then we'll open it up to
21 questions.
22 Elam, thanks for being here.
23 MR. HERR: Thank you, Mr. Chairman. Since
24 Mr. Hagelgans has already given my testimony, I will skip
25 that; and you have it and you can read it a little later. 61
1 What I will do is try to attempt to address some of the
2 questions and issues that have been brought up.
3 First of all, what is being asked is what was in
4 place prior to 2011 in the Cancer Presumption Legislation.
5 Part of the problem there, and if you look at it, was that
6 the law went back ten years and none of the commercial
7 insurance companies had any reserves for that and everybody
8 bailed.
9 Right now, there's only a couple of commercial out
10 there providing workers' comp for volunteer firemen; so they
11 all went into SWIF. And what has happened over that time,
12 again, SWIF not normally being in this business, didn't know
13 what they were going to do. They did not have an experience
14 rating, and they did not have the reserve; so the costs went
15 up substantially for premium dollars.
16 Now, to answer the question of Mr. Nelson (sic.),
17 municipalities, whether it's a stand-alone coverage for a
18 volunteer fire company or it's part of the municipal, the
19 law states that for either townships, boroughs, we have to
20 pay that premium for workers' comp. So it isn't coming from
21 the fire company, it's coming from the municipality.
22 The other issue, as I started out as saying, we
23 want to go back, basically, to what it was prior to the
24 cancer presumption, in that these people basically were
25 being covered if there was a type of accident. What we have 62
1 heard in the last couple of years is individuals who are
2 volunteering like fire police are out at the scene and
3 getting hit by drivers who aren't paying attention for one
4 reason or another; they're in a hurry to get home, whatever;
5 they don't listen to the fire police, and something happens.
6 Second thing you have to realize with some of these
7 volunteers that aren't actually fighting fires, there's
8 another state law that says, if there's an accident on a
9 state highway, volunteer fire companies have to respond. So
10 normally a fire truck will go out, but the fire police go
11 out.
12 With that, if the incident is minor but say a
13 telephone pole was down, the fire police will stay there
14 until such time as a utility company comes out to replace
15 it, which puts these people in harms way for a substantial
16 period of time.
17 So, you know, there is exposure to these people
18 that they're not actually fighting the fire but they are
19 providing a service to the municipality. You also have to
20 realize this is a major problem, the whole issue with
21 volunteers for municipalities.
22 The fire commissioners, the last couple, have
23 estimated that if we lose our volunteer fire companies, it's
24 going to cost the Commonwealth approximately 8 to 10 billion
25 dollars a year. That's a lot of money to come up. So what 63
1 we're asking these volunteers to do is not only go out and
2 fight the fires, respond to traffic incidents on state
3 roads, called out when the cat is up the tree, they also
4 have to go to training and go out and raise money. That
5 takes a lot of time away from their families and everything
6 else.
7 So what has happened over the years, we have gotten
8 these other types of volunteers, which are in some cases,
9 just as vital as the volunteer that is going out; because
10 it's taking some responsibilities away from the volunteer
11 firefighter and giving it to others.
12 And, yes, potentially, they will not be exposed to
13 the same type of issues as a volunteer fireman is; but they
14 can also get hurt, you know, whether it's a chicken dinner
15 or the chicken corn soup that I went to just the other week
16 for a volunteer fire company, it all helps raise funds to
17 keep the volunteer fire company going.
18 I do agree with Mr. Marshall when he's saying if
19 this goes back in. And in our testimony, we say there are
20 two issues that we have with the actual language that issues
21 like the cancer presumption and the Hep C have to be
22 addressed, because they are the ones right now that are the
23 biggest exposures. Although, if you look at the record
24 since 2011, there's only been one case that I know of that
25 has been granted for the cancer presumption under this Act 64
1 for a volunteer fireman. Paid fire are a little different,
2 but volunteer is one.
3 Back at the time we were going through this when
4 the studies throughout the United States showed that on an
5 average it was less than ten claims in the largest states
6 like California, and we haven't even reached that in the
7 time period, those seven years that it's been in, let alone
8 on an annual basis. So those are some of the other issues.
9 One of the things, also, to consider in the cancer
10 presumption, you know, 10 years, 20 years ago, it was a
11 bigger liability because firemen didn't have air packs.
12 Today, if a fireman goes into a burning structure without an
13 air pack on, he deserves what he gets; and I hate to say it
14 that way.
15 But today, it's shown that you need air packs when
16 you go into buildings -- burning structures. The
17 individuals who are outside of that, like the fire police,
18 can be downwind of that structure and they don't have air
19 packs on, so they can be exposed to the same type of
20 cancerous agents that may be in the smoke.
21 So the end result is, you know, we support the bill
22 that's introduced. We would like to see it being tightened
23 up a little bit. If you look at the law right now, it is --
24 the two qualifiers that are in the law that I don't think
25 SWIF is looking at, one is that the chief of the fire 65
1 department or company can authorize individuals to do
2 certain things on the buildings and on the apparatus.
3 The other caveat is that in other functions that
4 could be performed for the volunteer fire company or EMS,
5 you need the approval of the municipality. So with
6 communication between the municipality and the fire
7 companies, we are at least -- I should say the existing Act
8 is saying that they should be covered by some types of
9 workers' comp.
10 And, again, to reinforce it, prior to the cancer
11 presumption, it was being covered. It's only since that
12 time. And I could go through a list of different scenarios
13 that would show where volunteers that aren't actually
14 fighting the fires are being injured.
15 The last thing I want to state is that due to this
16 cancer presumption, you may want to speak to Representative
17 Ferry. He has another piece of legislation in to try to
18 bring the commercial side of insurance back into the market.
19 He's been looking at this because of the cost that he has
20 experienced since he was one of the prime movers of the
21 cancer presumption piece of legislation.
22 Thank you, Mr. Chairman.
23 MAJORITY CHAIRMAN KAUFFMAN: Thank you. And just a
24 note: Your second-to-the-last comment there, I was working
25 with another member who was taking a benefit ride through my 66
1 district, a benefit motorcycle ride through my district, and
2 he wanted fire police there to help get the benefit ride
3 through. And in my working with him to do that, we had to
4 go through two municipalities who both have stake in that
5 local volunteer fire department as far as workers' comp
6 issues go; so I think there are a lot of municipalities who
7 are doing that because they recognize that without the
8 volunteer fire service, they will be hard up to provide what
9 is necessary for the health, safety, and welfare of their
10 residents, so --
11 Questions for Elam? Representative Dush.
12 REPRESENTATIVE DUSH: Thank you. Elam, the
13 lookback for ten years, do you know if that was -- I know it
14 was retroactive for any currently written policies, but if
15 someone were to come in from the commercial market now,
16 would they be liable for going back ten years, as well?
17 MR. HERR: Yes, that's what Representative Ferry is
18 looking at, that if a fire company would leave SWIF and go
19 to a trust or a commercial carrier, that the money -- the
20 reserve in excess of what SWIF needs to keep, would also go
21 with that fire company to that new policyholder.
22 REPRESENTATIVE DUSH: So when we're looking at --
23 well, it would be a portion of that, an $18-million spread?
24 MR. HERR: Yes.
25 REPRESENTATIVE DUSH: All right. Thank you. 67
1 MAJORITY CHAIRMAN KAUFFMAN: And Representative
2 Ferry's bill is in the House Veterans and Emergency
3 Preparedness Committee.
4 MR. HERR: A hearing is scheduled for the 15th.
5 MAJORITY CHAIRMAN KAUFFMAN: I knew it was coming
6 up, but I wasn't sure of the date. So, yes, I knew they
7 were working on a hearing. Yes.
8 Representative Neilson.
9 REPRESENTATIVE NEILSON: Thanks, Chairman. You
10 mentioned -- we took earlier testimony here, and he
11 mentioned that his volunteer fire company has paid a
12 $70,000-increase in premiums. Well, you just brought it to
13 my attention that the municipality has to cover that
14 insurance, not the volunteer fire company.
15 You corrected my statement from earlier, because I
16 was just going off what the gentleman told me.
17 MR. HERR: Yeah, literally --
18 REPRESENTATIVE NEILSON: The municipality is
19 required to do this. So as far as the liability and the
20 expense on the volunteer fire company, the only way that's
21 -- you're telling me that's not a fact. I mean, I don't
22 know where -- I mean -- and, for the record, I'm
23 Representative Neilson, not Nelson. Eric's on this
24 Committee, too.
25 MR. HERR: I apologize. 68
1 REPRESENTATIVE NEILSON: But I wanted to make sure
2 that was correct, too. So as a fact, you're saying that
3 you're factual and he's -- that's not true what he said,
4 because the municipality's covering that insurance.
5 MR. HERR: I think even with his comment that he
6 made that the insurance premium for his fire company went
7 up, the municipality, and I think it's Manor Township,
8 would've been liable for that. They may have paid that
9 directly --
10 REPRESENTATIVE NEILSON: Well, he said that he had
11 to do more fundraising stuff to pay for this premium; but it
12 sounds like to me that this is the responsibility of the
13 municipality, not of the individual fire --
14 MR. HERR: Under the Workers' Comp Act, it's under
15 that Act, it stipulates that boroughs and townships are
16 responsible for workers' comp. Now, they may have some type
17 of agreement where the fire company's paying for that with
18 the municipality picking something else up; but, in reality,
19 the municipality is responsible.
20 Whether the municipality pays for it, my township,
21 or the volunteer fire company, the end result is the cost
22 has gone up substantially where the experience rating has
23 not changed.
24 REPRESENTATIVE NEILSON: I also -- to be -- I got
25 that, and I want to move to the Chairman -- I'm probably 69
1 holding everybody up, and I don't want to do that. I take
2 offense to the statement you said about the firemen being
3 their own fault not wearing a pack. I come from a house of
4 firefighters, and I take real offense to that; because
5 different situations call for different things. And an
6 example, I would say is, you know, a volunteer firefighter
7 comes up and lands on a scene prior to the truck and all the
8 equipment being there and has the ability to climb up a tree
9 and onto a rooftop and save somebody's life, I believe
10 you're presuming that everything's perfect, every
11 situation's perfect and to say that that firefighter
12 deserves what he gets, and I'm going to end it there, I just
13 thought that was a very untasteful statement to make.
14 And I'm going to thank you for your testimony,
15 because you testify a lot; and I never heard anything like
16 that. And I think you misspoke, and you might want to
17 correct the record because that's not what --
18 MR. HERR: What I was talking about is when they're
19 going into a burning building --
20 REPRESENTATIVE NEILSON: It's like the situation I
21 said; you know, things like that happen.
22 MR. HERR: And I understand.
23 REPRESENTATIVE NEILSON: So to group everyone in
24 one group, I mean, I just think it was unnecessary to state;
25 and I'm going to end it there for me. 70
1 Thank you, Chairman.
2 MR. HERR: We lost three volunteer firefighters in
3 Lancaster County several years ago, where they came up with
4 a youngster that fell into an abandoned septic tank. The
5 reason we lost those three firefighters -- and I do feel for
6 their loss and their families' loss was, all three of them
7 went in without an air tank. And the chief actually said
8 afterwards, they knew better, but they were trying to save
9 the kid. I understand that. Maybe I did misspeak.
10 I also make the statement that if you think about
11 it, firefighters, whether they're volunteer or paid, are
12 actually crazy; because human nature and the animal kingdom
13 says, you run away from a fire, you don't run in.
14 I respect volunteer firemen. I respect paid
15 firemen, because they're doing a job that I'm not doing and
16 saves lives and property. So if you took exception to what
17 I said, I understand. I didn't mean it the way it sounded.
18 REPRESENTATIVE NEILSON: That's what I wanted,
19 because that's the record. And I didn't think you did,
20 because I've known you for quite some time now and I've
21 never heard anything like that come -- I'm like, Wow. But I
22 wanted -- but that's part of the record, and I wanted to
23 make sure that record was corrected; because I don't want
24 anyone to read that and perceive that you don't care,
25 because I know you testify a lot, you do, and you live and 71
1 bleed this. So I wanted to be sure everybody knew that.
2 Thank you, Chairman.
3 MR. HERR: And I appreciate that. Thank you.
4 REPRESENTATIVE NEILSON: And thank you for your
5 testimony.
6 MAJORITY CHAIRMAN KAUFFMAN: Thank you very much to
7 all who testified today and to the members who made this a
8 priority to be here this morning. I know things were kind
9 of, you know, juggled because of session schedule.
10 So some great information. I think it gives us
11 some good feedback to sink our teeth into as we look at this
12 issue moving forward. So thank you very much.
13 (Whereupon, the hearing concluded.)
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25 72
1 CERTIFICATE
2
3 I hereby certify that the proceedings and evidence are
4 contained fully and accurately in the notes taken by me on the
5 within proceedings and that this is a correct transcript of the
6 same.
7
8 ______
9 Tracy L. Markle, Court Reporter/Notary 10
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