Category Archives: Workers’ Compensation

Changes to workers’ comp

Governor Cuomo announced New York’s workers’ comp system would reduce assessment costs to employers by 26 percent in 2014, saving businesses and local governments $300 million in annual expenses.  The Business Relief Act cuts the assessment to employers from 18.8 percent to 13.8 percent, the largest reduction since 1998, and provides a one-time workers’ compensation assessment savings to all self-insured employers of approximately $500 million.

Signed by the Governor as part of the 2013-14 budget, the Business Relief Act achieves $800 million in savings by reducing the cost to operate the workers’ compensation system, otherwise known as assessments, in two ways. Closing the Re-Opened Case Fund initially saves all New York State employers a $300 million annual assessment. In recent years, the cost of the Re-Opened Case Fund has grown exponentially while failing to serve its originally intended purpose. Closing the fund also reduces unnecessary litigation in the workers’ compensation system, another cost savings for employers.

Heather C. Briccetti, Esq., president & CEO of The Business Council of New York State, said, “The Business Council welcomes this significant reduction in Workers’ Comp Board assessments and the new simplified assessment methodology. This fulfillment of part of the Governor’s 2013 reform package is an important first step in the continuing effort to make New York’s comp system more efficient, less expensive and less of an impediment to economic growth in the State. We look forward to working with the Board in continuing to implement reforms meant to deliver care to injured workers and bend the cost curve for New York’s employers.”

NY ranks second in nation for questionable WC claims

New York ranks second in the nation for questionable workers’ compensation insurance claims according to the National Insurance Crime Bureau (NICB).

The analysis that questionable claims in NY more than doubled between 2011 and 2012 with 344 reported in 2012 and 161 in 2011.

Ellen Melchionni, president of the New York Insurance Association told the Insurance Journal, “Workers compensation insurance fraud is a serious problem in New York.  Fraud drives up workers compensation rates. The state and insurance industry need to remain vigilant in cracking down on those looking to cheat the system.”

Claims for 2013 are expected to exceed those reported in 2012.

Workers’ comp for major league ballplayers

Major league ballplayers are covered under workers’ compensation just like any other worker. Take the case of the Met’s Matt Harvey. Surgery to repair a torn ligament in his elbow is covered under Major League Baseball’s Basic Agreement with players, meaning the Met’s must pay for the surgery and recover what they can of the cost for workers compensation insurance.

You can read the full story here.

I-STOP takes effect today

Prescription drug oversight legislation known as the Internet System for Tracking Over-Prescribing Act, or I-STOP, takes effect today.

The measure will result in a real-time database that gives physicians information on a patient’s prescription history before prescribing potentially addictive drugs.  Pharmacists will be required to provide information and a safe drug disposal program for expired or unused medication will be implemented.

More NY workers getting workers’ comp

The number of workers covered by workers’ compensation in New York increased 1.4 percent from 2010 to 2011. Wages also increased 3.9 percent during the same period according to the National Academy of Social Insurance.

The number of New York workers covered by the insurance rose from 8.2 million in 2010 to 8.31 million in 2011, with total workers’ compensation benefits amounting to $5.1 billion in 2011, up nearly 11 percent from $4.61 billion in 2010.

Other state-level trends included:

* Coverage and wages increased in all 50 states and the District of Columbia.

* Total benefits paid to injured workers increased in 29 jurisdictions.  However, benefits as a percent of total wages increased in only 17.

* Employers’ costs of workers’ compensation as a percent of total wages increased in 31 states, and remained unchanged in four.

* The share of benefits paid for medical care exceeded 50 percent in 33 states.

Read the full report here.



Re-engineering workers’ compensation

The Workers’ Compensation Board is looking for stakeholders to participate in a re-engineering project designed to improve and streamline New York’s workers’ compensation system and to utilize new infrastructure and technologies.

The Workers’ Compensation Board notice is available online.

The Business Council will continue to advocate for improvements and cost saving in the system.

Workers’ compensation in New York is a modern and sophisticated social insurance system still operating off an infrastructure designed decades ago. This project will re-imagine workers’ compensation in New York and build a new infrastructure that takes advantage of new technology, best practices, and 100 years of experience.

AMA reclassifies obesity for workers’ comp

Workers’ compensation costs for employers could rise steeply as a result of a decision by the American Medical Association to reclassify obesity as a treatable disease.

A report by the California Workers’ Compensation Institute (CWCI), says that paid losses on claims with the obesity co-morbidity averaged $116,437, or 81.3 percent more than those without; and that these claims averaged nearly 35 weeks of lost time, or 80 percent more than the 19-week average for claims without the obesity co-morbidity.

Obesity has historically been classified as a co-morbidity.  The change could lead to increased claims that include obesity as a co-morbidity and as a compensable consequence of injury.

BCNYS on workers compensation rate increase

Lev Ginsburg, director of government affairs for The Business Council of New York State, was interviewed last week on The New York Compensation Insurance Rating Board approving a 9.5 percent increase in workers compensation rates.

Ginsburg said, “The Department of Financial Services has recognized the increases in costs in the system and that’s reflected in a realistic loss cost.  The Business Council remains committed to working with the administration and the Workers Comp Board to further reform the workers comp system and realize greater costs savings and hopefully lower workers comp insurance costs in the future.”


Crain’s Op-ed: Fixing workers’ comp

Crain's New York Business logoThe following op-ed was posted by Crain’s New York Business. It zeros in on the high cost of New York’s workers’ compensation system. The op-ed mentions The Business Council’s advocacy efforts to improve that system – efforts that are bearing some fruit.

Crains: Corruption, campaign finance reform and fracking may be hot topics in Albany, but rank-and-file businesses across the state are more concerned about a less sensational subject: workers’ compensation. While it’s not an issue that propels political careers, New York’s system costs a whopping $6 billion a year. Surveys show only health insurance to be a greater worry for business owners.

Workers’ compensation reform happens rarely in New York because powerful vested interests—notably the plaintiff bar—are adept at maintaining what, for them, is a lucrative status quo. Aside from some key changes won by Gov. Andrew Cuomo in this year’s budget, the last significant fix was in the early days of the Spitzer administration. That 2007 change broadened the distribution of money, the vast majority of which had been going to a small fraction of workers injured on the job. But the savings that businesses were projected to realize have been overwhelmed by rising costs that were ignored or even abetted by the Spitzer reform.

With three weeks remaining in the 2013 session, there is little hope that legislators will make any more improvements this year. In fact, the business lobby is currently occupied—as it often is—with blocking bills that would make the system worse. The trial lawyers’ lobby knows its best defense is a good offense, so it pushes poisonous bills that consume the business community’s attention and resources.

Meanwhile, the Cuomo administration has shifted its efforts to improvements it can make administratively. In fact, it implemented one just last week: The Workers’ Compensation Board, after seven months of intensive advocacy by the Business Council of New York State, declared that injured employees can be assumed to have reached “maximum medical improvement” after two years. Even though the healing process for nearly all injuries rarely exceeds eight months, businesses hailed the new policy as a victory because lawyers had been dragging out cases, allowing their “still healing” clients to milk the system for six years of interim payments before starting the 10-year compensation clock established by the 2007 reform.

But many similar quirks remain unaddressed, notably the outdated schedules that dictate how long workers are paid for a given injury. Thanks to advances in medical care, ailments that once persisted for months or years are now fixed in a fraction of that time—yet the gravy train of yesteryear rolls on. That should be addressed this year by Mr. Cuomo, and next year he must press the Assembly again for reforms it denied him in March. The quest for a fair and rational workers’ compensation system continues.

[NOTE: As New York’s employers continue to struggle under the growing costs of the Workers’ Comp system, The Business Council is uniquely poised to make a significant positive impact to the system.  Not only is The Business Council the recognized representative of New York’s businesses by the Administration and the Board, through very regular communication, the Legislature has added our participation in the process into law.]

New York’s workers’ comp opioid epidemic

New York was recently ranked as the highest Northeast state for opioid abuse and its impact on workers’ compensation.  The Insurance Journal covered a study that was conducted by the Workers’ Compensation Research Institute (WCRI) which showed injured workers in New York have a greater tendency to become longer-term users of opioids.  New York ranked among the highest in the nation, second only to Louisiana.

The study covered commonly abused medications, the percentage of nonsurgical opioid claims, drug costs and the types of painkillers sold and found that New York, 14 percent of non-surgical workers’ comp claims with narcotics were identified as longer-term users.

Read more on The Insurance Journal’s website.