Price too high for workers’ comp proposals
 

(March 28, 2008) Lawmakers and taxpayers agree that Connecticut should start “tightening its fiscal belt” in this difficult economy. That’s why proposals to significantly increase workers’ comp costs for the state, municipalities and businesses seem out of step with economic and political reality.

Yet SB-64 and SB-255 are two proposals, approved by the Labor Committee, which would do just that. They so broadly expand benefits for workers’ compensation that Connecticut would be put considerably out of line with other states for benefits and costs — certainly beyond what the state, cities and towns, and businesses can afford.

Connecticut’s workers’ compensation system is fair, generous and considered one of the best in the United States. But SB-64 would greatly expand benefits for scarring to include even conditions that don’t affect a worker’s ability to earn a living — clearly outside of what the system is intended to do.

The state’s Office of Fiscal Analysis estimates that SB- 64 will cost the state and municipalities at least $1 million in the first year alone — on top of the additional costs employers will have to bear.

Another proposal, SB-255, seeks to expand the state’s “discretionary” benefits that can be awarded by workers’ comp commissioners on top of weekly wage replacement and other compensation. No other state offers this type of award, yet the Labor Committee wants to increase it.

The problem, says the state’s Office of Fiscal Analysis (OFA), is that this proposal “will result in a significant cost to the state and municipalities.” OFA looked at one small sample, the month of May, 2007, in which the state handled 38 discretionary benefit claims — to illustrate the range of costs.

“Under the bill, if each of these 38 claimants received the maximum statutory discretionary benefits, costs to the state, over the life of the claims, would increase by $4.3 million,” says OFA.

But OFA also pointed out that the state actually averages more than 100 such cases each month — which means that the actual costs of SB-255 would be staggering to state government — to say nothing about how it would affect Connecticut businesses.

Both of these proposals would overturn some of the most important reforms of the state’s workers’ compensation system that helped make it financially stable, fairer and less costly. It simply makes no sense to roll back the reforms and stop progress being made to improve the state’s economic climate.

As the General Assembly continues its work, it’s important that lawmakers consider each proposal for whether it will help or hurt Connecticut’s economy. Clearly, SB-64 and SB-255 would unnecessarily weaken the state’s economy.

For more information, contact CBIA’s Kia Murrell at 860-244-1931 or kia.murrell@cbia.com.