Dear Friends and Neighbors,
On March 5, the Senate passed strong, bipartisan workers’ compensation reform, Senate Bill 5566, by a vote of 34-15. Senate Bill 5566 provides injured workers with a voluntary settlement option and incentives to stay at work. It also provides a more flexible benefit option to workers, giving them more choices on what is best for them and their families, and real relief to businesses whose workers’ comp payments have skyrocketed.
Unfortunately, the bill did not get a public hearing in the House Labor and Workforce Development Committee and the House majority leadership has indicated it has no intention of moving the bill.
Negotiations continue, and we feel there are enough votes in the House to pass the measure if we can bring it to a vote on the House floor. Many of the major daily newspapers around the state editorialized their support for the legislation when the Senate took action. Now the Everett Herald (At least allow House to vote) and the Seattle Times (Workers’ Comp Reform deserves House vote) just want the House to have a vote on this bill.
We still have an opportunity to pass workers’ comp reform. Here are some of the reasons this needs to be addressed:
- The Department of Labor and Industries (L&I) pays $1.84 in benefits for every $1.00 in premiums it collects, the highest “combined ratio” of any public or private workers’ comp insurer in the country.
- According to L&I, these costs are not sustainable without annual double-digit premium increases on employers that pay into the state fund.
- The 2008 Washington Pension System Review (Upjohn Institute) confirmed one reason for the highest number of long-term disability cases and pensions in the nation is the absence of a voluntary settlement option that exists in 44 other states.
- Total benefits paid in Washington grew from $1.3 billion in 1998 to $2.2 billion in 2008. That’s an increase of 70.4 percent, compared to 34.2 percent growth for all states.
- Despite massive rate increases the past two years, the accident fund has a $360 million deficit (as of 9/30/10), and the supplemental pension fund has had to borrow money to meet current pension obligations.
- According to the state auditor, if the current trend in rate increases holds, there is a 96.4 percent chance the accident fund will remain insolvent over the next five years and a 94.1 percent chance the medical aid fund will become insolvent within five years without annual double-digit premium increase on employers that pay into the fund.
This is the most important jobs bill we could pass this legislative session. The best way to jump start our state’s economic recovery is to create stability for our businesses and options for workers. Workers’ comp simply costs too much for our employers. It is time for the House to take action.
Please do not hesitate to contact me if you have input on this issue or any others before the Legislature.
468 John L.O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
(360) 786-7968 | Toll-free: (800) 562-6000