Lawmakers Told Montana’s Workers’ Comp Costs Too High

A new study given to lawmakers shows that Montana’s workers’ compensation costs are among the most expensive in the country.

The National Council on Compensation Insurance report says that Montana ranked near the bottom in a number of different cost categories.

State relations executive Mike Taylor told a legislative panel that Montana’s average medical cost per workers’ compensation claim is about $40,000 compared to $24,000 elsewhere.

The Economic Affairs Interim Committee has been charged with reviewing the state’s system amid worries that the insurance is too expensive for businesses. Lawmakers recently ranked the issue as a top interim priority.

Montana’s workers’ comp system is currently anchored by the quasi-public State Fund.

Taylor said there are many issues that go into the higher costs. He said the state has higher total benefits, greater frequency of workers’ comp cases, higher average costs and longer duration of open claims.

“You take this all together, and the result is not surprising,” Taylor said.

State Sen. Jim Keane pointed to one slide that showed costs per dollar paid in wages is almost double of where other states are at.

He said the study is a valuable resource in helping lawmakers identify specific problems that could be corrected with legislation. The panel aims to draft a bill for the 2011 Legislature.

“We can actually put our fingers on some of the cots drivers now,” said Keane, a Butte Democrat. “I think there needs to be meaningful legislation.”

Republican state Sen. Roy Brown of Billings said he will be looking at ways to reduce workplace accidents, reduce the duration of open cases and get injured workers back on the job.

“We all knew the situation is bad,” Brown said. “Now we’re going to come up with some legislation one way or another here.”

Latest Comments

• July 10, 2009 at 1:15 am

  JMV says:

  A key driver of the high costs in Montana workers' compensation is the loophole on exclusive remedy which allows tort litigation based on "bad faith" when employers, carriers ... read more
• July 10, 2009 at 12:34 pm

  bob says:

  no government agency should be in the business of selling insurance. eliminate all "state insurance funds" and have private enterprise write comp insurance. same for flood, cr... read more