Integration of Benefits Anticipated to Save Money

A recent report indicates substantial economic savings if health insurance (a date based system) was merged with workers’ compensation (an event based system) coverage. The report, authored by a study group headed by Frank Neuhauser, and funded by the California Healthcare Foundation, predicts substantial money savings as well as system efficiency would occur upon integration of benefits.

“Integrating occupational medical care into the more efficient group health model would reduce administration to approximately 12% to 13%. We extend these findings to the US and estimate that the 10- year (2011- 2020) savings of integrating coverage would be between $490 billion and $560 billion, sufficient to pay for between 26% and 78% of the incremental cost of universal coverage.”

The study also indicates substantial savings in the costs of medical care would occur through integration of benefits.

“The savings would result from the much greater efficiency with which health insurance delivers care compared to workers’ compensation insurance. A minority of health insurance premiums (12%-14%) go to cover administration and profit. Workers’ compensation turns this ratio on its head, spending the majority (50%-60%) of premiums on these same overhead costs.”

“If near universal coverage becomes a reality, the medical portion of several types of property casualty insurance could be delivered in a much more efficient manner. Absent  near universal coverage, we will likely have to continue relying on the more costly, but  important role of other insurance models.”
.......
To read more about workers' compensation and medical benefits click here.

California the Epicenter of Workers Compensation Faces Political Gloom

Workers’ Compensation reform was the central political theme that brought Republican Governor Arnold Schwarzenegger into power. After dramatically deforming that system by reducing access and benefits, compounded by other economic woes, California now faces major political upheaval in the upcoming elections.

A poll, reported in Politico, shows that major political change maybe forthcoming.

“Only a third of all voters approved of voters approved of Republican Gov. Arnold Schwarzenegger’s job leading the state, and 45 percent of voters expressed ‘disappointment’ in him, while another 25 percent felt ‘anger’ or ‘anxiety.’
.....
To read more about workers' compensation and California click here.

High Unemployment Rates & The Future of Workers Compensation

Soaring unemployment rates will continue to have a critical impact upon the nation's workers' compensation system. The US Bureau of Labor Statistics released numbers revealing that The unemployment rate rose from 9.8 to 10.2 percent in October.

"In October, the number of unemployed persons increased by 558,000 to 15.7 million. The unemployment rate rose by 0.4 percentage point to 10.2 percent, the highest rate since April 1983. Since the start of the recession in December 2007, the number of unemployed persons has risen by 8.2 million, and the unemployment rate has grown by 5.3 percentage points."

"Among the marginally attached, there were 808,000 discouraged workers in October, up from 484,000 a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The other 1.6 million persons marginally attached to the labor force in October had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities."

While currently disabled workers may continue to collect benefits in most jurisdictions , even if unemployed, lower payrolls will result in lower premium revenues for insurance companies and lower contributions to State workers' copensation funds. The advocacy system will continue to implode with the resulting less revenue to maintain present and generate new infrastructure.

The numbers show a pattern that the "aging workforce", complicated by younger discouraged workers, may have difficulty finding employment in the new market post-recession. While the practice of workers' compensation law may rebound somewhat on the future, it will cetainly take a different path.
...
To read more about the the furture of workers' compensation click here.

The Workers' Compensation Beauty Pageant

The chore of ranking state workers' compensation systems is tougher than judging a national beauty pageant.  Peter Rousamiere made an excellent attempt this week in Risk and Insurance. The real answer is in the eyes of the users of the system and not merely on the commercial factors that industry relies upon to judge value.

Workers' compensation is social, remedial legislation. It is supposed to be a summary proceeding that delivers benefits expeditiously and efficiently to injured workers. The promise made in 1911 was a system removed of fault,  contributory negligence and assumption of the risk. Society has reneged on that agreement and now apportions and allocates disability on pre-existing conditions, prior functional credits and individual habits of workers. Ironically, it is Industry itself that markets items that results in obesity, smoking addiction and many other allegedly non-compensable factors.

The quality of a system is not only factored on rate of benefits, cost of insurance and lost time frequency. It is a system that should be evaluated on the human factors of injured workers' access to benefits and the time required to achieve the result. Justice delayed is indeed justice denied.

Yes, California, Alaska, New Jersey, New York and Montana may all share the bottom of the tank on the Risk and Insurance rating scale. However, horror stories are heard from Massachusetts (#1) concerning "opt-out programs," and in Nevada (#2) from OSHA, concerning the failure to abide by safety regulations. These dismal problems seem to be universal and embrace the entire program as it now exists.

Like the Miss America Pageant, it is time to take a good hard look at how the system presently functions and why it is not meeting expectations, both financial and socially.  Congress should commission an undertaking to figure out how to put the workers back into workers' comp.

To read more about a Congressional Commission click here.

BP fined by OSHA a record $87M for Texas City Explosion

Four years follow a massive explosion in Texas City, OSHA fined BP a record $87 million dollars.


The Financial Times reports:


"Jordan Barab, acting assistant secretary of the labour department’s Occupational Safety and Health Administration, said that in spite of Lord Browne being replaced as BP chief executive after the blast, BP continued to violate US safety regulations under the leadership of Tony Hayward.


“There are some serious systemic safety problems within the corporation,” Mr Barab said.


“That there are so many life-threatening safety problems at this plant means there is still a systemic problem.


To read more about OSHA click here.

NIOSH: H1N1 Flu Is A Serious Risk to Healthcare Workers

The National Institute for Occupational Safety and Health (NIOSH) has declared that 2009 H1N1 Influenza poses a serious risk for healthcare personnel. With at least 4 deaths of nurses being reported in the media, NIOSH has stepped up its efforts to gather and analyze the prevalence of illness and fatalities among health workers.

"Healthcare personnel are at increased risk of occupational exposure to the 2009 H1N1 virus based on their likelihood for encountering patients with 2009 H1N1 illness. In contrast to seasonal influenza virus, 2009 H1N1 influenza virus has caused a greater relative burden of disease in younger people, which includes those in the age range of most healthcare personnel. For some healthcare personnel, this higher risk of exposure and illness may be compounded by the presence of underlying illness which places them at higher risk of serious flu complications, such as asthma, diabetes, or neuromuscular disease. Of particular concern to the healthcare workforce, which is largely female, is the fact that pregnant women are among those groups considered to be at higher risk of severe infection from 2009 H1N1."

For more articles on Workers' Compensation and the Flu Pandemic click here. 

Congressional Hearing to Examine OSHA's Review of Nevada Program

The U.S. House Education and Labor Committee will hold a hearing on Thursday, October 29 to examine the federal Occupational Safety and Health Administration’s critical review of Nevada’s workplace health and safety program. OSHA reviewed Nevada’s health and safety program between January 2008 and June 2009 and found a number of deficiencies with the plan. A spate of accidents drew national attention during the city’s building boom that killed 12 construction workers on the Las Vegas strip over an 18-month period between 2006 and 2008. 


Full Committee Hearing
10:00 AM, October 29, 2009
2175 Rayburn H.O.B
Washington, DC
Watch live testimony click here.

Witnesses:

• U.S. Sen. Harry ReidNevada
• Jordan BarabActing Assistant Secretary of LaborFederal Occupational Safety and Health Administration
• Debi Koehler-FergenMother of worker killed at the Orleans Hotel and Casino in Las Vegas
• Don JayneAdministrator
  Nevada Division of Industrial RelationsDepartment of Business and Industry
• Franklin MirerProfessor of environmental and occupational healthHunter College of the CityUniversity of New York

Additional witnesses to be announced

To read more about OSHA and workers' compensation click here.