Proposed Workers’ Compensation Insurance Rates Would Drop For Fifth Consecutive Year

Rate Hearing on Workers’ Comp Filing Scheduled for October

On August 24, 2007, the Florida Office of Insurance Regulation issued the following information regarding the latest rate filing for workers’ compensation insurance rates due to become effective in 2008.

The National Council on Compensation Insurance, which produces and files rates for insurers in many states, said the rate decline was primarily due to a significant drop in claims frequency and a reduction in the costs of claims.

Should you have any comments or questions, please do not hesitate to contact this office.

 

Proposed Workers’ Compensation Insurance Rates Would Drop For Fifth Consecutive Year

A rate hearing on the filing will be scheduled by the Office of Insurance Regulation in October, and the rate change would be effective for new and renewal business as of January 1, 2008.

Florida Insurance Commissioner Kevin McCarty announced on August 24, 2007 that he has received the latest rate filing for workers’ compensation insurance rates due to become effective next year. The filing calls for an overall average rate decrease of 16.5 percent statewide, which would produce a savings of over $650 million for Florida employers.

If approved, the rate decrease would be the fifth consecutive drop since the Legislature passed sweeping reforms to the state’s workers’ compensation system in 2003. The cumulative overall statewide average rate decrease since 2003 would total -50.4 percent.

“Every sector of our economy is going to benefit from a more affordable workers’ compensation marketplace,” said McCarty upon receiving the filing. “It is great news for both employers and employees because benefits are being delivered more fairly and efficiently, and our employers are paying lower rates. The reduction of fraud and abuse in the system is certainly paying off.”

Prior to the legislative reforms, the State of Florida consistently ranked #1 or #2 in the country for the highest workers comp rates; however, post-reform, Florida has dropped out of the top 10 rankings.

The National Council on Compensation Insurance, which produces and files rates for insurers in many states, said the rate decline was primarily due to a significant drop in claims frequency and a reduction in the costs of claims.

A rate hearing on the filing will be scheduled by the Office of Insurance Regulation in October, and the rate change would be effective for new and renewal business as of January 1, 2008.

The law passed in 2003 instituted provisions for enhanced fraud compliance and revised permanent and temporary disability definitions. It also set new parameters for attorney and physician compensation and improved dispute resolution procedures, in addition to making many other improvements to the system.

Florida’s Workers’ Compensation system had been weighed down with high liability coverage costs for employers and low benefits for injured employees.

 

Florida Workers’ Compensation Regulatory Update

 

69L-7.100: Florida Workers’ Compensation Ambulatory Surgical Center Reimbursement Manual Rule Update – The Florida Workers’ Compensation Ambulatory Surgical Center Reimbursement Manual has been adopted and became effective August 19, 2007.

This Rule implements reimbursement rates as well as other important amendments throughout each section of the rule. A copy can be viewed by clicking here.

To view the Final Adopted Rule, click here.

 

69L-7.020: Florida Workers’ Compensation Health Care Provider Reimbursement Manual-Update. The Florida Workers Compensation Health Care Provider Reimbursement Manual hearing scheduled on August 22, 2007 was not requested, and therefore, was not held. To view a copy of the meeting notice and Proposed Rule, click here.

After all required Rule adoption administrative procedures are taken, it is anticipated that the Reimbursement Manual will go into effect in late September 2007. The Florida Division of Workers’ Compensation will issue a formal DWC E-Alert notification advising parties of the official effective date of this reimbursement manual, and will update the Web site accordingly.

To view the Florida Workers’ Compensation Health Care Provider Reimbursement Manual, 2007 Edition (May 16, 2007 draft), click here. The major change to this reimbursement manual is to incorporate the 2007 Medicare values into Part B and Part C of the manual.

 

69L-7.501: Reimbursement Rule Update – On February 23, 2007, two Rule challenge petitions were filed in reference to the Florida Workers’ Compensation Reimbursement Manual for Hospitals, 2006 Edition. The parties subsequently entered into a Settlement Agreement, which was approved by the Three-Member Panel in its meeting of June 14, 2007. Following release by the Florida Division of Administrative Hearings, the Division will file the Rule with the Secretary of State for final adoption. The effective date of the Rule will be twenty days after it is filed with the Secretary of State.

The Division anticipates these steps will result in an effective date of approximately October 1, 2007. Until the effective date of the 2006 edition, the appropriate reimbursement manual to use is the Hospital Reimbursement Manual, 2004 Second Edition, which can be accessed by clicking here.