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Study: Illinois workers’ comp premiums drop from 8th highest in nation to 22nd

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Illinois

The Oregon Department of Consumer and Business Services has released its bi-annual analysis of workers’ compensation premiums across the country and it is good news for Illinois.

For several years our high ranking in the Oregon Premium Rate Survey - which ranks states based on how much employers pay for workers’ comp insurance -has been used by the business community and lawmakers as a reason Illinois needs to enact further reforms in the workers’ compensation system.

However, according to the recently released 2018 Oregon Premium Rate Ranking Summary, Illinois has now moved from 8th highest in 2016 to 22nd highest in 2018, which is one of the largest drops in the country.

Illinois now ranks in the middle of the pack compared to other states – which was the goal of lawmakers when bipartisan majorities approved the last workers’ compensation overhaul back in 2011.

This substantial drop in the rankings for Illinois further illustrates that the changes made to the laws in 2011 are producing lower costs for insurers and employers – which, as we predicted, have not been passed on to employers in the form of premium reductions.

More here. Wisconsin was eighth highest, Ohio was 36th highest, Michigan was 37th highest, Massachusetts (which has a program that Gov. Rauner wanted to follow) was 38th and Indiana ranked second lowest.

posted by Rich Miller
Tuesday, Nov 27, 18 @ 2:43 pm

Comments

Illinois Policy Institute heads exploding in 3..2..1..

Comment by Da Big Bad Wolf Tuesday, Nov 27, 18 @ 2:49 pm
Wasn’t that one of the “reforms” that mean old Madigan wouldn’t allow Rauner to have?

Comment by Skeptic Tuesday, Nov 27, 18 @ 2:50 pm
Looking at the last report, in 2014 IL had 127% of the state wide median, in 2016 121%, and in 2018 106%. So while premiums might not be reduced here in IL, they seem to be growing much slower than other states? That’s my 5 minute take away.

Comment by Perrid Tuesday, Nov 27, 18 @ 3:02 pm
This is good news. Madigan offered Rauner more workers comp reform and Rauner refused, long before the grand bargain. Madigan was right, Rauner was operating in the extreme.

Comment by Grandson of Man Tuesday, Nov 27, 18 @ 3:14 pm
What happened here? I have a memory of the insurance companies not passing along the savings from the 2011 reforms. Did something occur, some law or enforcement take place to solidify the change? Why now? It seems like quite a big change to happen naturally or without stimulus.

Comment by Honeybear Tuesday, Nov 27, 18 @ 3:22 pm
Or or, I just realized, did 14 other states get suddenly worse? That actually seems more reasonable. Thus could it be that because of the 2011 reforms, we stayed static while 14 states with less effective laws got pummeled.

Comment by Honeybear Tuesday, Nov 27, 18 @ 3:25 pm
Perhaps we should drop Land of Lincoln for Middle of the Pack. Has a nice ring to it.

Comment by SSL Tuesday, Nov 27, 18 @ 3:42 pm
This appears to be good news, but let’s remember this is one data source and when you get information from one data source, it’s usually incomplete data. More information is needed to make sure we’re actually making gains from the 2011 law.

Some of this could be because of of our loss of manufacturing jobs and gain in tech jobs in the Chicago area compared to other state’s gains of manufacturing jobs (which might explain Georgia’s jump, but that is just a hypothesis).

Also, many of our manufacturer’s are self insured so they would not be included in this study would could create more holes in data.

Again, not trying to discount this as good news, but this one year jump seems really odd and needs looked into a little more, otherwise we’re spiking the ball at or own 40 yard line.

Comment by Anonymous Tuesday, Nov 27, 18 @ 3:48 pm
Was the latest bill negotiated by biz & labor? Is there a lesson here for our duck?

Comment by Norseman Tuesday, Nov 27, 18 @ 4:00 pm
The data here only reflects rates, nothing on claims.
The best way to reduce worker’s comp claims is to proactively take steps to reduce workers injuries, not enacting new legislation.

Comment by Chicago 20 Tuesday, Nov 27, 18 @ 4:04 pm
This is the 2011 reform finally appearing. Now insurers need to share more with employers

Comment by Annonin' Tuesday, Nov 27, 18 @ 5:01 pm
Need a more competitive insurance market place in Illinois. Need a non-profit insurance company to offer work comp insurance.

Comment by 360 Degree TurnAround Tuesday, Nov 27, 18 @ 5:06 pm
–Wisconsin was eighth highest,–

By the logic of the Rauner/IPI/tronc propaganda machine, shouldn’t that have scared off Foxconn and any other manufacturers to Wisconsin?

California remains at the top of the premiums list. It also has the highest manufacturing output, and most manufacturing jobs at the highest wages — by far — of any state in the union.

–Some of this could be because of of our loss of manufacturing jobs–

Illinois has gained manufacturing jobs since 2011, when the legislation was passed, and since 2016, when the last premiums study was done.

http://www.nam.org/Data-and-Reports/State-Manufacturing-Data/

https://data.bls.gov/timeseries/SMS17000003000000001?amp%253bdata_tool=XGtable&output_view=data&include_graphs=true

Comment by wordslinger Tuesday, Nov 27, 18 @ 5:06 pm
Credit Madigan?

Comment by Keyrock Tuesday, Nov 27, 18 @ 5:47 pm
corporations not passing on the savings to their workers? Hmmmm, I don’t buy it

Comment by FDB Tuesday, Nov 27, 18 @ 6:25 pm
How long before IPI talks about the difference between Illinois and “Opposite Land” ???

Comment by Anyone Remember Tuesday, Nov 27, 18 @ 6:28 pm
The Oregon study is generally regarded as gold plated compared to others in the field of WC.

To answer Honeybear’s question, the Illinois Workers’ Compensation Commission in the past 4 years amended their Rules and streamlined a lot of operations, significantly reduced a stubborn backlog of cases, vastly improved their computer systems, and ran a shop that had no scandals or strange decisions. In fact, some of the strange WC decisions came from the Illinois Appellate Court on appeal from IWCC decisions.

From their Insurance Department to their administration of various funds that allow for COLA payouts to total permanent disability cases, those in the know saw a strong professional upgrade in their operations.

The Trial Lawyers releasing this information must mean they must have given up on a State Funded WC Insurance Company to try to drive down premiums. The 2005 changes which propelled us from the middle of the pack amongst the states to number 2 most expensive? Now we are back to the middle of the pack after a 15 year roller coaster ride.

So Honeybear, I know you are a state employee. Tip your hat to your fellow state appointed officials and state employees of the IWCC for a job well done, a job performed quietly while controversy swirled around them over proposed changes and counter-changes and resisting changes, handcuffing further reforms. A lot of those responsible for this quiet achievement will more than likely be gone come January when the new Governor takes over and starts making appointments.

Tip your hat to them Honeybear. They deserve at least a pat on the back for their efforts.

And yes, I’m more than slightly prejudiced here in my comments. And proud to be so prejudiced under the circumstances.

Comment by Louis G. Atsaves Tuesday, Nov 27, 18 @ 6:32 pm
===some of the strange WC decisions came from the Illinois Appellate Court on appeal===

This is exactly correct. The Supreme Court needs to step in and change this process.

Comment by Rich Miller Wednesday, Nov 28, 18 @ 12:25 am
Rich, does Oscar know you’re still up after midnight?

Comment by Tommydanger Wednesday, Nov 28, 18 @ 6:00 am
==The Trial Lawyers releasing this information must mean they must have given up on a State Funded WC Insurance Company to try to drive down premiums.==

Or people were going to read it anyway.

If the insurance companies aren’t passing down their savings, then it is in the employers’ interest to get that to happen. The Illinois Trial Lawyers Association might not have the resources or the motivation to make this happen.

Comment by Da Big Bad Wolf Wednesday, Nov 28, 18 @ 9:06 am