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Work Injury Statistics
Various states have undertaken efforts to reform their workers' compensation system, usually with assurances that the changes will be beneficial to businesses and to workers. But as these examples prove, that's rarely the case.
Beginning in 2000, skyrocketing workers' compensation insurance premiums forced legislators in California to consider reforming the state's workers' compensation system. In 2002 and again in 2003, then-governor Gray Davis signed two reform bills that increased benefits, changed the rules for medical treatment and lowered vocational rehabilitation costs.
But insurers resisted lowering their rates, and Arnold Schwarzenegger campaigned on a platform that more reforms were needed. He was strongly supported by businesses, and after taking office, he won legislative support for his harsh reform package.
The resulting reforms have been mostly favorable to the insurance companies. Workers' compensation premiums in California remain the second highest in the nation, and injured workers have seen dramatic reductions in benefits available to them.
According to a report released by the California Labor Federation in 2007:
In 2005, the Texas legislature approved a sweeping overhaul of the state's workers compensation, the first reform in 14 years. The changes were spurred by employer complaints about skyrocketing medical cost and rising insurance premiums.
Texas is the only state that doesn't require employers to buy workers' compensation insurance, and slightly more than a third have opted out. Those that do, however, face unlimited legal liability when an employee is injured on the job.
The 2005 reforms in Texas resulted in these changes:
In response to business complaints about high workers' compensation costs, Florida enacted a workers' compensation reform bill in 2003. At the time, Florida's workers' comp costs were the second highest in the nation.
In the five years since the reforms took effect, those costs have dropped by more than 50 percent. Florida's workers' comp costs are now 45th in the nation, and they continue to drop - 18.4 percent in the last year alone.
However, the cost reduction has come with a huge cost that in essence victimizes injured workers.
One of the most controversial provisions of the 2003 Florida reform package involved capping fees for attorneys who handle workers' compensation cases, no matter how many hours they put in. Previously, judges in Florida had discretion in determining fees and typically based them on the number of hours that the attorney had worked on the case.
Now, when a client wins a workers' compensation claim, the attorney may collect a fee equal to 10 percent to 20 percent of that award. Because of this, attorneys are turning away legitimate cases because they are too costly and too time consuming to take on. Some injured workers have literally been denied the right to have an attorney represent them in the workers' compensation claims.
The issue has been brought to the attention of the Florida Supreme Court, which has been asked to overturn the section of the state's workers' compensation statutes that limit attorneys' fees.