JULY 1998

Ongoing Council efforts pay off again: comp rates fall for third time since 1996
Council will press for more critical reforms, especially objective medical guidelines

The Business Council's successful multi-year campaign for workers' comp reform will save all New York State businesses money again this year.

Governor George E. Pataki has announced that workers' compensation rates will be reduced in New York State for the third time since reforms were put into place in 1996, dropping 6 percent this year.

The 6 percent decrease follows reductions of 8.4 percent and 18.0 percent in 1997 and 1996, respectively. In 1995, rates were reduced by an average of 5 percent.

As a result of the four rate decreases, New York employers have seen their workers' compensation rates decline by 33percent since 1995.

The Business Council believes that further savings in workers' comp costs are possible and will continue to urge lawmakers to pass more critical reforms, especially the adoption of objective medical guidelines.

"Through workers' comp reform, we've saved businesses a great deal of money while improving New York's business climate-and we can do even better by adopting objective medical guidelines," said Daniel B. Walsh, president of The Business Council.

The Council supports the use of objective medical guidelines to determine the extent of disability in workers' comp cases, he noted.

"Most states already use objective medical guidelines, but New York still lets individual doctors evaluate workers' comp cases subjectively," Walsh said. "Objective guidelines just make more sense."

After some 10 years of pressure from The Business Council, lawmakers finally approved workers' comp reform in 1996. The 1996 reform followed strong leadership from Gov. Pataki, who made the 1996 budget agreement contingent on workers' comp reform.

"New Yorkers have not seen a multi-year reduction in workers' compensation rates like this one since Governor Averill Harriman's administration 40 years ago," Governor Pataki said. "This action results in the largest cumulative rate decline in the history of the New York State workers' compensation system.

"This latest rate cut demonstrates that our efforts to make New York a more attractive place to do business continue to pay off," the Governor added.

The 1996 reforms limited the ability of third parties to sue New York State employers, mandated safety programs for some employers based on safety records, created new anti-fraud protections, and helped reduce costly delays in the workers' comp system.

The 6 percent rate reduction in 1998, which will take effect Oct. 1, is an average rate change; reductions will be larger for some employers and smaller for others. The reduction includes the third consecutive decrease in the assessment charged to employers for administering the comp program.

July 23, 1998