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Legislative Memo

Ken Pokalsky
Vice President of Government Affairs
T 518.465.7517 x205
www.bcnys.org

BILL:

S.2781 (Onorato) / A.2135 (John)

Support

SUBJECT:

Determination of Workers' Comp Permanent Total Disability

 

DATE:

March 27, 2009

 

The Business Council strongly opposes this legislation, whose effect – if not its explicit intent – is to undermine the permanent partial disability duration limits adopted as part of the state's 2007 comprehensive workers' comp reform legislation.

The business community would have never supported the 2007 reform package if the provisions proposed in this legislation were included.

The 2007 reforms, agreed to by business and labor, provide significant increases in comp benefits.  Importantly, it also contained significant reform measures already found in most other states' comp programs.  Key among them is a duration limit on non-scheduled permanent partial disability awards of up to ten years. 

Full and timely implementation of the PPD caps is crucial to maintaining already-announced comp premium reductions, and in keeping New York's workers' compensation costs from climbing back to their former position among the highest in the nation.

This legislation would tilt the state's comp system toward awarding permanent total, rather than permanent partial, disability awards by establishing a legal presumption that any comp claimant that has been approved for Social Security Disability (SSDI) benefits has a permanent total disability under New York's Workers' Compensation Law.

While both SSDI and workers' compensation have similar definitions of total disability, there is little relevance between findings of social security disability and permanent total disability under workers' compensation law.

Recent data published by the Department of Insurance and Workers' Compensation Board shows that while about 25 percent of workers' compensation claimants receive SSDI benefits at some point during their disability, only about 1 percent of comp claimants who do receive SSDI benefits are classified as permanent total disability under workers' compensation. 

In a drastic change to current state law, this bill would give a presumption of permanent total disability to the other 99 percent of comp claimants who receive any SSDI benefits, and who in fact do not qualify for permanent total disability benefits under New York's workers' comp law.

The logic behind this proposal is severely flawed.  There are major differences between SSDI and workers' compensation that make this approach both inappropriate and unsupportable. 

For example,

The 2007 reform agreement was  a careful balance between increased system costs – driven by increased benefits – and system reforms that will help make it more affordable to New York State employers.

This legislation would severely disrupt that balance, by undercutting the most significant program reform included in the package.

It would result in increased program costs, and a return to a costly,  uncompetitive state workers' compensation system

For these reasons, The Business Council opposes approval of S.2781/A.2135.