A roomful of insurance agents seems the last place a bunch of manufacturers would want to find themselves. But earlier this month, when the head of the state’s Worker’s Compensation Commission addressed a gathering of several hundred agents, any manufacturers in the room would have taken notice.
The message brought by Chairman John Mastropietro: In short, get ready for changes in workers compensation insurance. Experience and history is pointing toward it.
Now, the state’s had no substantial change to its workers compensation model since 1993, when it was completely overhauled to reduce benefits for workers, and the prohibitive high cost for employers. Benefits were reduced by a third for any worker looking to collect. But the lower payouts made the coverage, which employers are required to carry, less expensive.
Mastropietro described the overhauls that were pushed through in the early 1990s as something of a bitter struggle and those legislators involved with it had little interest in revisiting the complicated maneuvering that installed a new regime.
But most of those lawmakers are gone. Of the 151 legislators who were involved in the early 90s reforms to the workers compensation law, only 23 remain. Those who can’t remember the infighting that gave us the current system are more likely to revisit it, Mastropietro warned.
His evidence? Several years of bills introduced into the general assembly that would alter the workers compensation system. All failed. But their existence demonstrates a willingness on the part of newer lawmakers to revisit something that in years past had been anathema.
Rules May Be Revisited
“The pendulum tends to swing every 15 years or so, and we’re nearing the end of that cycle,” Mastropietro said.
The most recent legislative session saw the failure of bills that would have increased benefits for workers scarred on the job, required minimum allotments of sick days, prohibit “use it or lose it” policies on paid time off, and a range of other changes.
It’s not just neophyte lawmakers driving the changes. Medical care — which is paid for under workers compensation — has become proportionately more expensive than it was in 1993. CT scans, specialized tests and other medical procedures that are now common in most hospitals and doctors’ offices were a rare thing 15 years ago.
Translation: The structure of the medical world has changed, so maybe workers compensation should, too.
Rates Rising
Whether the general assembly tackles it is another question. One thing’s for sure: Rising premiums for workers compensation routinely rank among the top concerns for the state’s businesses.
Premiums are scheduled to rise about 3.4 percent on average next year.
In manufacturing, however, that increase will amount to just less than 1 percent on average.
Nevertheless, in a survey of manufacturers conducted by the Connecticut Business and Industry Association in late October, nearly 9 percent identified workers compensation as their “most onerous cost” of doing business. Health care topped the list, with 54 percent. If changes come to workers compensation insurance, Mastropietro said the biggest thing any employer could do to weather potential changes is to prepare programs that would get injured workers back in the door, and to make changes to the types of things that caused injuries in the first place.
Light duty and return to work programs, many of which have been established over the last few years at area businesses, are a good example, he said.
“Too many employers treat workers compensation like a car accident,” he said. Accidents can be avoided or at least minimized, and trying to do so is a smart way to reduce injuries and in the long run lower premiums, he said.
Kenneth J. St. Onge is a freelance writer. Reach him at kenstonge.com