Our Positions | Federalizing the WC System


Workers’ compensation systems have existed for approximately one hundred years at the state level. Each system provides a Grand Bargain that allows for timely and efficient reimbursement of wage replacement and medical expenses related to occupationally incurred injuries and illness. In return, employers are not the recipients of vexatious litigation thereby preventing overburdening the court system in each respective jurisdiction under essentially a no-fault exclusive remedy system. As far back as 1972, there has been federal discussion of these systems concerning the need for federal encroachment in this area without consensus. Federal commissions continue to be suggested as needed to review the system and ensure its adequacy.

However, the workers’ compensation system has evolved as a local solution to a local concern that does not need intervention. Protested workers’ compensation claim decisions in state administrative tribunals are a vast minor subset of the hundreds of thousands of claims that are automatically paid to claimants on a yearly basis. Healthcare providers are essentially local/regional in nature and any added bureaucracy may only slow down claims and backlog the process creating delay and needless costs for the system.

State legislatures are more acutely aware of the needs of its citizens and can react accordingly. Due to sound risk management, risk exposure avoidance and mitigation by employers, a large majority of states have seen loss cost reductions. Safety remains a priority concern for anyone employing individuals in the workplace. Additionally, occupational injuries and likewise the industry that employs those workers are in many instances unique to a state or group of states where a one size fits all national composite may not be effectively implemented. Federal regulation in this area is unnecessary and may result in unintended consequences such as delay and jurisdictional confusion that exacerbates claims and associated costs, rate pressures for risk coverage not germane to particular employee segments or regions of the country, and loss of competent healthcare providers who do not wish to submit themselves to the anticipated federal scheme or oversight.

NAMIC POSITION

NAMIC opposes any federal commission on Workers’ Compensation as being unnecessary and redundant of state-based workers’ compensation laws and regulatory parameters. The goal of any workers’ compensation program should be to efficiently and timely address work place injury and illness, obtain adequate and evidence based cost-effective managed treatment for the same, provide statutory indemnity replacement for wage loss, institute vocational and physical rehabilitation and to foster meaningful return to work as soon as practicable and where applicable. State legislatures can and do periodically address issues of concern with their constituents in a more timely and robust manner than their federal counterpart and should be allowed to continue this time-tested process unfettered by federal oversight.

NAMIC News on Federalizing Workers Compensation

Contacts

Jon Bergner
Assistant Vice President of Federal Affairs

202.580.6751

  Jon