Federal involvement in state comp system unjustified, group says

A plan to create a federal commission to evaluate and make recommendations for state-based workers' compensation systems is unjustified, according to the National Association of Professional Insurance Agents.

The group came out in opposition to House Resolution 635, sponsored by Rep. Joe Baca, D-Calif. Under the legislation, deemed the National Commission on State Workers' Compensation Laws Act of 2009, federal lawmakers would establish a separate body to evaluate state workers' comp laws in order to determine whether the regulations provide an adequate, prompt and equitable system of compensation and medical care for injury or death arising in the course of employment.

"This is a typical Washington, D.C. approach -- appoint a commission, give it a big budget, and create a big new bureaucracy," said Johnny Lee, chairman of the organization's National Government Affairs Committee. "The fact is, none of this is necessary. Workers' compensation programs are regulated by the states, not the federal government. The federal government should not seek to interfere in a state-based and state-regulated system. This is a waste of time and taxpayers' dollars."

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The legislation, which was introduced in January, has been referred to the House Committee on Education and Labor. Baca said it is critical that the federal government examines state comp laws in a similar manner to the national commission that was authorized by the Nixon administration in 1972. That commission concluded that the system of state comp laws was "inequitable and inadequate" and made numerous recommendations. The government, Baca said, has not taken a close look at state comp laws since.

Under the proposal, the commission would be composed of 14 members, 10 of whom would be political appointees. The commission would have the authority to hold hearings, issue subpoenas, take testimony, and receive evidence. It would be required to make recommendations for improvements to the workers' comp system within 18 months.

"State insurance regulators through the National Association of Insurance Commissioners already have a Workers' Compensation Task Force studying these issues," said Mike Becker, the group's national director of federal affairs. "That is the appropriate body to be involved in making recommendations for improvements. It is entirely possible that H.R. 635 is being used to position the state workers' compensation system as another ?target of opportunity' for those wanting to bring about federal insurance regulation."

June 22, 2009

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