Delaware Workers’ Comp Task Force Issues Report, Recommendations

Delaware’s state task force charged with examining Delaware’s workers compensation insurance rates published a report and 18 recommendations to address double-digit rate increases in recent years.

The task force, led by Delaware Lieutenant Governor Matt Denn, was established earlier this year to address rising average workers’ comp rates in the state.

Main recommendations include a two-year inflation freeze on medical providers’ fee schedules, as well as a reduction in the inflation rate allowed for hospital treatment, and reductions in allowed reimbursements in some medical categories. Additionally, the panel also recommends that workers’ comp carriers’ requests for rate hikes receive “a high level of scrutiny.”

The following are the recommendations the panel issued on Monday.

1. Place tighter controls on workers compensation medical costs

2. Ensure that insurance carriers’ requests for rate increases receive a high level of scrutiny.

The task force said several panel members expressed concern about whether the rates ultimately approved for workers comp carriers were justified by the actual increases seen in medical costs, and whether carriers were overstating the amount that they needed to reserve in order to pay future claims. In addition, several members expressed frustration that some amount of rate increase appeared to be driven by the failure of individual carriers to be sufficiently diligent about enforcing existing medical cost controls when paying claims. The following recommendations are targeted at ensuring that a high level of scrutiny is applied to rate increase requests by carriers.

3. Make the state’s laws encouraging injured workers to return to work more effective.

4. Improve the state’s workplace safety program to both increase its usage and ensure that it accurately determines which workplaces are using appropriate safety practices.