Ask the Insurance Industry “Where’s the money?”
Tuesday, Jun 30, 2015
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Two recent studies published by NPR/Pro Publica and the federal Occupational Safety and Health Administration (OSHA) show that nationwide, insurance companies have kept any cost savings from recent workers’ compensation “reforms” for themselves, with profits climbing to 18 percent in 2013 – while middle and lower-income families and taxpayers are paying the price.
In 2011 Illinois enacted its own workers’ compensation “reform” package aimed at lowering costs for businesses. Workers gave up longstanding rights and in return, insurance companies were to be transparent with pricing and pass savings along to employers. As it turns out, only the workers kept up their end of the bargain.
The National Council on Compensation Insurance (NCCI) is an independent, non-partisan agency comprised of insurance professionals licensed by the Illinois Department of Insurance to assess workers’ compensation in Illinois and make premium rate recommendations to insurers. Since 2011, NCCI has recommended insurance premium reductions totaling nearly 20 percent.
The 2011 reforms were projected to save insured employers nearly $1 billion assuming the insurance industry would fully adopt the NCCI recommendations.
The insurance industry’s failure to fully implement NCCI recommended rate reductions has prevented Illinois insured employers from realizing any meaningful savings.
No matter how many benefits are cut, medical reimbursements are lowered, and claims are denied, the state’s businesses won’t see corresponding savings without our leaders addressing the promises previously broken by the insurance industry.
For more about workers’ compensation, click here.