Newly approved lost-cost rates, coupled with already realized savings, will save state employers upwards of a billion dollars
ALBANY, N.Y.—The Business Council of New York State, Inc., today highlighted the newly approved 11.7 percent reduction in loss cost rates, which are the basis for setting workers’ compensation premiums for 2019. The result will be significant workers’ compensation savings for most New York employers next year. This reduction, coupled with the 4.5 percent rate cut achieved in the first year of the 2017 reforms, means overall system costs will be reduced by upwards of one billion dollars.
“Thanks to the rate approval by the Department of Financial Services, employers of all sizes and from all regions of the state will see a significant reduction in their workers’ compensation costs,” said Heather C. Briccetti, Esq., president and CEO of The Business Council of New York State, Inc. “These savings would not have been achieved without the hard work of our legislative team, our members and key state lawmakers from both houses and both sides of the aisle, who recognized the need to get this done. We especially want to single out Senate Majority Leader John Flanagan along with Senators Amedore and Akshar and Assembly members McDonald and Woerner for their tireless advocacy.”
The 2017 reforms capped classification of Maximum Medical Improvement, reigning in the high costs associated with the needless delay of claim finalization. The adoption of new Impairment Guidelines for scheduled loss of use awards, which eliminate unnecessary monetary bonuses associated with certain injuries and treatments, are set to render savings to the system. The anticipated adoption of a pharmaceutical formulary will likely do the same.
The reforms achieved balance by enhancing coverage for injured workers through decreasing the threshold for the permanent partial disability cap “safety net”. The reforms also removed the requirement that an injured worker, who was entitled to benefits and attached to the labor market at the time of classification, demonstrate attachment to the labor market.
Briccetti added, “New York businesses face significant challenges in their ability to grow and hire more workers. The combination of an uncompetitive tax structure, unfair and unnecessary regulatory burdens, and rising health care costs have pushed many state businesses to the brink. That is why these reforms, and the savings that come with them, are so significant. We applaud the state Legislature and the Governor for getting this done and look forward to working on additional legislation to reduce the cost of doing business in New York State and help grow the economy and create jobs.”