Oklahoma official calls for 'meaningful reform' in approving rate hike

Several large employers have told Oklahoma officials they may leave the state if workers' comp reform is not "aggressively addressed in the next legislation session," according to the state's insurance commissioner.

John D. Doak made the comment in approving NCCI's proposed 0.4 percent increase in workers' comp loss costs.

Saying workers' comp costs are spiraling out of control, Doak said reforming the system is critical for the state's future.

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"Oklahoma has some of the highest costs in the country and businesses have had enough," Doak said in a statement. "We need meaningful reform, not window dressing."

According to figures quoted from NCCI, Oklahoma's average cost for permanent partial indemnity is nearly double the regional average -- $47,000 per case compared to $25,000 for the region. Unlike most states, indemnity benefits comprise the lion's share of workers' comp benefit costs in Oklahoma.

Indemnity costs make up 55 percent of total workers' comp benefits in Oklahoma. Nationally, medical costs make up the majority of benefits.

Regulators have been holding forums throughout the state to get input on possible legislative remedies to the workers' comp system in advance of the 2013 Legislature session.

One option may be the so-called opt-out system, which would allow employers to manage their own injury benefit programs. A 2012 proposal was ultimately rejected by the Oklahoma Legislature.

Proponents have spent the last several months meeting with various organizations to garner support. They hope to present the Legislature with another proposal in January.

Read more at the WorkersComp Forum homepage.

November 19, 2012

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