Troy Rosasco Says New Report Spotlights Shift of Cost Burden for Workers’ Compensation onto Taxpayers

Wednesday, March 11, 2015

Troy Rosasco, Partner, Turley, Redmond, Rosasco & Rosasco, LLP, says the new report about workers’ compensation shows how employees who are injured on the job and file for these benefits are unable to receive them because the states continue to cut benefits at the expense of the taxpayers, who must now take on this financial burden through programs such as Social Security Disability.

“The Demolition of Workers’ Comp” — a report released by ProPublica and National Public Radio — shows how states, including New York, have implemented serious cuts to workers’ compensation benefits over the past 10 years, denying them to those who need it most and shifting the costs of workplace accidents away from employers and to the taxpayers. According to the report, employers are paying the lowest workers’ compensation premium rates since the 1970s and insurers have since seen record profits — an 18% return.

These are some of the findings from this report:

● Since 2003, legislators in 33 states have passed workers’ compensation laws that reduce benefits or make it more difficult for injured or ill workers to qualify for them. In Florida, these benefits have been reduced by 65% since 1994.

● New York has reduced payments for injured workers by 35% for workers with permanent partial disabilities by capping benefits after an arbitrary time limit.

● The amount of workers compensation payments to injured workers varies widely by state. For example, the total loss of an eye is $27,280 in Alabama but $261,525 in Pennsylvania.

In 2010, New York implemented medical treatment guidelines for workers’ compensation which have significantly lowered workers’ compensation costs for employers, but have limited adequate medical treatment for many workers. Finally, the state reduced assessments on businesses by 26% in part by closing a fund for old cases.

Despite the employers’ claims that workers’ compensation insurance is too expensive, ProPublica and NPR found that the average cost in 2014 was $1.85 per $100 of a worker’s wages — less than half of what it was in 1988, when it was $3.42. North Dakota has the lowest rate of 88 cents, compared to $2.39 in 1988. Last year’s rate for New York was $2.85; in 1988, it was $2.98.

“This report is an eye-opener and exposes the false employer and insurance company narrative in Albany that workers’ comp costs are out of control and benefits need to be reduced for the state to remain competitive,” Mr. Rosasco said. “This is simply not true. The facts are that a large portion of the costs for workers’ compensation once borne by the employers have now shifted to the taxpayers through programs such as Social Security Disability, lowering the cost to employers. With employers paying less for work-related injuries, they have less incentive to prevent workplace accidents in the first place. So now the workplace is getting more dangerous, workers’ benefits have been slashed, employer costs have gone down dramatically and all taxpayers are paying the bill.”

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