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.
- SSDI determinations are based on disabilities from any cause, not just workplace injuries, as is the case under workers' compensation. This bill could lead to presumptive comp determination based on non-workplace injuries.
- SSDI determinations can be made within five months of an injury; workers' compensation classifications are made after a claimant reaches “maximum medical improvement,” which can be up to two years after the injury. (Note that workers' comp claimants are eligible for both medical care and temporary total disability benefits prior to MMI and classification.)
- SSDI determinations are often made for temporary disabilities; it makes no sense to use temporary total disabilities under SSDI as the basis for a finding of permanent total disabilities under workers' comp. The workers' compensation law already provides for a process to transition claimants from temporary to permanent classifications.
- SSDI determinations, upon which this presumption of permanent workplace-related disability is based, are made in a non-adversarial setting, and provide no opportunity for input by the claimant's employer or its carrier.
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.