A trio of workers’ comp reform bills were passed by the State Senate last week. Three others may be voted on soon.

The bills that passed are:

• Senate Bill 5112 – Allows claims representatives for retro employers and groups to schedule independent medical examinations and vocational rehabilitation assessments, subject to certain conditions. Click here for vote tally.
• Substitute Senate Bill 5127 – Addresses the arbitrary 55-year-old age limitation on structured settlement availability. Original bill would have removed the age restriction on voluntary claims settlements but an amendment lowered the age restriction to 40 rather than eliminating it. Click here for the vote tally.
• Senate Bill 5128 – Also deals with structured settlements, the bill streamlines the program in keeping with the legislation that passed in 2011 with a strong bipartisan vote. Click here for the vote tally.

These bills must still be passed by the State House of Representatives. The three other workers’ comp bills are:

• Senate Bill 5124 – Streamlines the way time-loss benefits are calculated for injured workers by replacing the current formula, which varies based on the worker’s marital status and number of children to a standard two-thirds percent.
• Senate Bill 5126 – Addresses a recent Supreme Court ruling by reaffirming that the state and self-insured companies can reimburse their benefit costs when a third party outside of the employment relationship causes a workers’ injury on the job.
• Senate Bill 5125 – Redefines “occupational diseases” to be a condition that must arise out of the course of employment and be proximately caused by the distinctive conditions of that employment. The increased frequency of occupational diseases for the natural aging process is one that has been seen on many cases. This legislation would put back in place the original intent of what the law was designed to cover for Industrially related Occupational Diseases.

These bills will help stem a looming $110 million a year surcharge on employers. The reforms passed in 2011 slowed big rises in premiums but didn’t solve all of the problems plaguing the system. Unless lawmakers take the next step, employers are facing a $110 million surcharge for each of the next 10 years as L&I attempts to rebuild its depleted reserve fund. Building reserves is a good thing, but doing it with large surcharges will hinder job creation.

After initially floating the idea of raising average workers’ comp rates 5-9 percent in 2012, the Department of Labor and Industries officially proposed an average rate increase of 2.5 percent. 

A few weeks ago L&I asked its Workers’ Comp Advisory Committee to consider increases ranging from five to nine percent.  After protests by business groups including AGC’s call for a zero percent increase, L&I came back and officially proposed the 2.5 percent increase.  Rates would vary by business type and risk class.  Some examples for construction: 13% increase for excavation, road construction, landclearing; 8% for masonry; 1% for elevator installation

CLICK HERE for proposed rate by business type and risk classification code.

The final rates will be adopted in early December and go into effect Jan. 1, 2012. Public hearings on the proposed rates will be held in:

• Vancouver, Oct. 25, 9 a.m., Red Lion Hotel Vancouver at the Quay
• Tukwila, Oct. 26, 1 p.m., L&I Office
• Bellingham, Oct. 26, 1 p.m., Bellingham Public Library
• Richland, Oct. 27, 1 p.m., Red Lion Hotel Richland Hanford House
• Spokane Valley, Oct. 28, 10 a.m., Spokane CenterPlace Event Center
• Tumwater, Oct. 28, 10 a.m., L&I Headquarters