Report recommends 2% increase in workers comp rates
Friday, September 3rd 2004, 5:54 am
By: News On 6
OKLAHOMA CITY (AP) _ A new report recommends that state insurance regulators raise Oklahoma's workers' compensation insurance rates by 2 percent next year, far below the 11.5 percent increase sought by an insurance industry group.
An actuarial report prepared for the state Board for Property and Casualty Rates, which sets workers' comp rates, cites legislative reforms, improvements in worker safety and other factors that have driven down costs in the state.
``In recent years, a series of workers' compensation reforms have been implemented in Oklahoma,'' the report by the Madison Consulting Group of Madison, Ga., says.
The report goes on to say losses have continued to decrease since the reforms were put in place.
Workers' compensation losses in 2002 were 30 percent less than a decade earlier, according to the actuarial statement.
The rate recommendation is the third received in the past month by the agency that sets workers' comp rates.
The National Council on Compensation Insurance recommended the 11.5 percent increase in August. But an actuarial report prepared for Attorney General Drew Edmondson said the request was ``excessive'' and recommended no increase. Edmondson represents businesses in workers' comp cases.
The board will consider the industry's rate hike request on Sept. 28. It rejected a 6.4 percent rate hike request last year.
The NCCI is seeking an increase in its ``loss cost'' rates, the direct cost of settling workers' compensation claims like medical bills and salary reimbursements. The costs are about 70 percent of what a covered company pays.
Democratic Gov. Brad Henry has urged ratemakers to reject the NCCI's request and to hold the line on the cost of workers' comp insurance. An 11.5 percent rate hike would result in a premium increase of $30.2 million to Oklahoma businesses.
Lt. Gov. Mary Fallin and Republican legislative leaders have criticized the high cost of Oklahoma's quasi-judicial workers' compensation system, citing dueling doctors, attorney fees, soft tissue injuries and medical costs.
Henry has appointed a bipartisan group of industry experts to draft a reform proposal that will be considered by the Legislature next year. The group is examining workers' comp laws in the 10 states where premiums are lowest.