Spitzer Speaks on Workers’ Compensation

Cyrus Dugger

Spitzer Speaks on Workers’ Compensation

Yesterday, newly elected NY Governor Spitzer gave his first State of the State address to the state assembly. Spitzer is going to be implementing a truly breathtaking list of initiatives and reforms in New York. He said this about workers’ compensation:

Business Regulations: Workers’ Compensation and Wicks Law Reform
We must start with our workers’ compensation system, a system that does not work for anyone: not the employers who pay some of the highest premiums in the country, and not the workers who receive
some of the lowest benefits. I have already begun discussions with the Legislature and representatives
from both business and labor to arrive at a solution that will lower employer premiums, while increasing worker benefits for the first time since 1992. A solution must also make it easier for workers to get the medical treatment they want and need so they can get back to work. (link)

The New York Workers Compensation Alliance Law Blog said this in response:

Eliot Spitzer is a smart guy (Horace Mann, Princeton, Harvard Law) who surrounds himself with smart people. It is becoming increasingly clear that the new Spitzer administration has come to the conclusion that it cannot trust the data and misleading statistics on workers’ compensation costs, insurance company profits and benefit levels put forth as gospel (and unquestioned by the slumbering New York press) by the Business Council of New York State and the insurance lobby.
The Governor’s State of the State Address today was important for what it didn’t say. Much to the chagrin of the Business Council and insurance lobby, he did not say he favored capping permanent partial disabilities (PPD’s). He simply said that the system needs to be reformed - something those of us who have represented injured workers these last fourteen years know all too well.

The Business Council (nice new website funded by MetLife, IBM, GE, Citigroup etc) largely relies on statistics from the insurance company CEO controlled National Council on Compensation Insurance (NCCI). Check out this 2006 "State of Workers' Comp Insurance Line" video or PDF document to learn what NCCI is all about (Short version - gouging New York business with increased premiums to make up for investment losses, even though claims are down!) It's eye opening to say the least!
Let's now provide all stakeholders and policy makers with a reliable source of workers' compensation statistics and analysis - Professor John Burton's Workers' Compensation Policy Review. Ever since his days as a professor at Cornell's School of Industrial and Labor Relations to his years as Dean of the Rutger's University Business School, Burton has been one of the leading non-partisan authorities on workers' compensation policy and economics in the United States. His 73 page July 2006 report entitled: "Workers' Compensation: Benefits, Coverage and Costs, 2004" is the most up-to-date state by state comparison of key workers compensation data, and is must reading for anyone who wants to get workers' comp reform right.
Over the next few weeks, we will use this report and others to prove why the Business Council's misleading statistics only prove the old adage, "Figures don't lie, but liars can figure!" (click here for link and internal links)

Comments

I'm interested in the discussion of workers compensation I've seen on this site. It's nice to see that New York has a governor who is going to try to make the system more fair for workers, but frankly, based on what Gov. Spencer is saying, it doesn't seem that New York's system is all that bad compared to other workers compensation systems around the country.

In Florida, for example, the insurance industry has succeeded in convincing the legislature to, by a death of a thousand cuts, essentially make it impossible for workers compensation plaintiff's attorneys to make a living. The caps on attorney’s fees for plaintiffs work are so onerous that, in certain cases, the maximum allowable fee is on the order of $10 to $15 per hour--clearly not enough to maintain a law practice. As expected, lawyers are leaving the practice of workers compensation defense work in droves. This is a brilliant and disgusting way to prevent workers for accessing their workers compensation rights--dry up the pool of available lawyers and workers will be stuck having to represent themselves. We all know how well that is going to work out.

I happen to know about this because my step father is a workers compensation lawyer in Florida, and it has become nearly impossible for him to make a living.

Meanwhile defense lawyers can be paid whatever the insurance company can afford. Although this system is clearly unequal and unjust, the Florida First Circuit Court of Appeals has found, in all of the cases brought so far on this issue, that the caps are constitutional.

To me this is an important issue of justice in the legal system and it is one that is largely flying under the radar. An entire body of injured individuals has essentially been denied access to the courts and no one is talking about it. I've looked for discussion of this topic on this site and found only a few specific discussions of unfairness (for 9/11 workers, for example), but nothing about the mechanics of this systematic effort to stack the deck against workers in Florida and many other states and what can be done to turn it around.

Robert: If you have a citation to the Florida statutes that limit lawyer compensation, would appreciate a cite.