Washington Closer to Eliminating Workers’ Comp Insurance Monopoly

By | July 19, 2010

A campaign to end Washington’s monopoly on workers’ compensation insurance appears to have enough support to qualify for the November ballot, adding to a busy initiative season in Washington politics.

Initiative 1082 supporters submitted stacks of petitions with an estimated total of more than 340,000 voter signatures. That’s well above the roughly 241,000 required to earn a spot on the fall ballot, pending certification from state election officials.

The I-1082 campaign is led by the Building Industry Association of Washington, a trade group active in conservative politics. Insurers and other statewide business groups also are supporting the initiative.

The opposition campaign is being led by the state trial lawyers’ association and organized labor groups. Both are usually aligned with Democratic and liberal political causes.

At present, Washington is one of just four states that do not allow private companies to offer workers’ compensation insurance, although some employers self-insure under state supervision.

I-1082 would allow private insurance firms to offer their own plans in competition with a state-run system. It also would drop the current state mandate for employees to pay a share of premium costs.

Campaign leaders said they expect that call for more competition to be embraced by an electorate that is struggling with a slow economic recovery and an unemployment rate above 9 percent.

“The recession has highlighted for voters how important it is to make Washington a friendly place for businesses,” said BIAW spokeswoman Erin Shannon. “Voters are really motivated and I think they’re paying attention, and some of them are really angry and they’re ready for significant change.”

Business and labor interests regularly battle over Washington’s workers’ compensation system at the Legislature. Businesses generally complain about the cost of premiums and the state’s management practices, including relatively plump benefits for injured workers.

Labor officials argue that Washington’s system protects workers better than a private one by forsaking profits. Defenders also say the state has relatively moderate costs, ranking about midway nationally in one study when including “pension” costs for the permanently disabled.

“This system has its faults, but it works pretty well as a public system,” said Alex Fryer, spokesman for the “No on 1082” campaign. “When you introduce the profit motive into a system like this, what we’ve seen in other states is that claims get denied and delayed for a long time.”

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Insurance Journal West July 19, 2010
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