The Workers’ Compensation Rating and Inspection Bureau (WCRIB) of Massachusetts is reportedly not in agreement with the decision by the State’s Insurance Commissioner, Julianne Bowler, to decrease the average rates for Mass. workers’ compensation insurance, effective Sept. 1.
“We regret that the Commissioner decided to decrease workers’ compensation insurance rates in Massachusetts by 4 percent,” stated WCRIB President Paul Meagher. “We believe that testimony and documentation presented during the nearly four-month-long hearing process made a clear, factual and compelling case for the need for a rate increase, given the impact of rapidly and dramatically increasing medical expenses and other cost drivers.
“The Commissioner’s decision threatens to exacerbate rate inadequacy and jeopardize the health of the workers’ compensation insurance market in the Commonwealth,” Meagher continued. “Massachusetts officials cannot continue to ignore the negative impact on workers’ compensation insurance caused by the double-digit increases in health care and pharmaceutical costs. These same escalating health care costs, that have already caused significant adjustments to the state budget and forced many employers to cut back on health care benefits for their employees, are projected to continue to rise at an annual rate in excess of 12 percent.”
The bulletin noted that prior to the Commissioner’s decision “workers’ compensation insurance rates in Massachusetts stood at the same level as in 1983, due to a series of five double-digit decreases between 1993 and 1999 that cut rates by 58 percent.” It stressed that “over the past decade, rates have gone up only once – in 2001, when a one percent increase was allowed. As a result, the availability of coverage through the voluntary market has decreased. This has forced many more employers to obtain coverage through the assigned risk pool which has increased in size from 4 percent of premium in 1999 to 17 percent today.”
Required by state law to be carried by every employer in Massachusetts, workers’ compensation insurance pays lost wages, medical expenses and other benefits for employees who are injured on the job.
The WCRIB is the state’s licensed rating organization. It files rates on behalf of insurers writing workers’ compensation coverage. The bulletin noted: “In February, the Bureau filed with the Division of Insurance for a 10.8 percent rate increase, which was adjusted later to an 8.6 percent increase. Subsequently, Attorney General Thomas Reilly submitted a filing to the Division recommending a 21.4 percent decrease in rates, and the Division’s State Rating Bureau weighed in for a 9.9 percent decrease.”
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