CHICAGO — Mayor Lori Lightfoot unveiled her plans to reform the $100 million per year workers’ compensation program on Thursday.
The mayor’s office released a full, independent audit that showed the massive program was poorly managed.
Lightfoot announced she’s hiring an outside firm to administer Chicago’s worker’s compensation program that for decades was controlled by now-indicted Alderman Ed Burke.
“The system that Ed Burke ran was ripe for corruption,” she said. “A program of this size and significance has no business being controlled by a single member of the City Council.”
An audit found that under Burke the program did not operate according to industry best practices, staffers were inadequately trained and there were no controls in place to prevent fraud, waste and abuse.
The mayor said as of March 31, there were about 1,300 open claims, many of which date back several decades. More than 600 are more than 10 years old, costing taxpayers roughly $300 million.
Lightfoot said the city should have settled the open claims. Instead, disability checks were issued to people who were well enough to work.
“We were paying people taxpayer dollars without resolving their claims and over 600 that are over a decade that’s an unacceptable state of being,” she said.
To reform the system, the city will partner with outside firm Gallagher Bassett.
“What we’re trying to do now is establish a bright line that Chicago is actually going to come into the modern age and have a program that is consistent with best practices across the country,” she said.
The workers comp program has long been the subject of scrutiny. Back in January, when the feds charged Burke with attempted extortion, former Mayor Rahm Emanuel took control of the program away from Burke.
Laurence Msall of the Civic Federation said it’s bad business and ancient thinking for a city to allow a lawmaker to manage an expensive program.
“It was a throwback to an earlier time when the City Council controlled the workers’ comp program. Modern governments don’t have their legislative body managing very much,” he said. “Today was a wonderful signal that it appears that the mayor is modernizing city government.
WGN reached out to Burke for comment did not hear back.