The Business Council strongly supports the workers’ compensation reform package proposed in the FY 2017-18 State Budget. The reforms to New York’s workers’ compensation system that will create meaningful savings for all employers in the state.
This balanced proposal will increase support for the most injured workers while controlling wasteful spending in the system. The cost-saving highlights of reform include:
- Capping classification of Maximum Medical Improvement at 2.5 years by providing a credit to employers for temporary payments beyond the threshold, which will apply to all claims for injuries after 4/10/17;
- The mandated development of new Impairment Guidelines for use in determining scheduled loss of use awards, to be adopted by 1/1/18, that will adhere to modern medical evidence and modern medical outcomes, and apply to all SLU determinations made after their adoption;
- The issuance of a pharmaceutical formulary by the Workers’ Comp Board by 12/31/17.
- The reform also includes provisions designed to enhance coverage for injured workers by:
- Decreasing the threshold for the permanent partial disability cap “safety net” from an impairment of 80% to 75%;
- Removing the requirement that an injured worker, who was entitled to benefits and attached to the workforce at the time of classification, demonstrate attachment to the labor market;
- Expedite hearings to 45 day from date of request by injured workers’ who have not yet received any payment of benefits;
- Additionally, there are provisions to:
- Create a panel to study independent medical examinations;
- allow the state to purchase assumption of liability policies to manage the costs of closing Special Funds;
- Create minor modifications to NYCIRB’s public reporting and recertify NYCIRB as the rate setting organization until 2028;
- Establish performance standards for penalties and assessments on carriers and self-insured employers.
We anticipate that these reforms will bring about significant savings in year-one and will continue to provide premium savings as Impairment Guidelines go into effect further down the road, creating even greater annualized savings of hundreds of millions of dollars into the future.
The approach to this negotiated bill was fair and its outcomes will be beneficial to all parties. For these reasons, The Business Council strongly supports passage of A.2009-C / A.3009-C.