Rates are down but leaders are up on workers' comp changes

TALLAHASSEE, Fla. – Workers’ compensation rates have been reduced by nearly 10 percent this year but state legislative leaders said this week they want to make some changes to the system designed to help injured workers return to their jobs.

Florida House Speaker Richard Corcoran fast-tracked the House’s workers’ compensation bill (HB 7009), passed by the chamber by a 74-30 vote on Friday.

And Senate President Joe Negron said this week that some of his members are anxious to pass something this session even though there is no Senate companion for the House plan.

Other workers’ compensation bills have been filed in the Senate, however. For instance, one measure (SB 376) would extend workers’ compensation benefits to first responders who suffer from post-traumatic stress disorder as a result of trauma they experience on the job. 

Corcoran told The News Service of Florida in an interview Wednesday that the high costs of healthcare in Florida’s workers’ compensation system need to be addressed.

“I think that the problem is largely the hospitals who want a reimbursement rate that’s the highest in the southeast region,” Corcoran, R-Land O’ Lakes, said. “That our problem.”

Among other things, the House measure caps the fees hospital outpatient centers can charge for unscheduled care at 200 percent of what Medicare would pay for the procedure. For surgeries that can be scheduled in advance, either at a hospital or at an ambulatory surgical center, the bill limits charges to 160 percent of what Medicare would pay for the procedure. Currently, providers are allowed to bill the workers’ compensation carrier a percentage of their billed charges.

The proposal passed Friday mirrors the position the Florida House took last year, but the Florida Senate had no appetite for reducing how much hospitals and ambulatory surgical centers could bill for caring for injured patients.

It’s not clear that any progress has been made since last year.

Negron this week stressed that any proposal his chamber considers would have to treat everyone in the system --- including injured workers, attorneys and insurance companies --- fairly.

“There are a number of different parties involved in the workers’ compensation system, obviously,” Negron, R-Stuart, said. “We want to make sure workers who are injured are treated fairly. We also want the rates to be reasonable and we want the insurance company side to be run fairly.”

National Federation of Independent Business Florida Executive Director Bill Herrle, who has been pushing the Legislature to address workers’ compensation for more than a year, said the lack of a Senate bill isn’t worrisome.

“If some senators want to do workers’ comp, then not having a bill filed yet isn’t much of an obstacle,” he said.

Workers' compensation is a no-fault system meant to protect workers and employers. It is supposed to provide workers who are injured on the job access to medical benefits they need to be made whole. Those who are injured for at least eight days also are entitled to indemnity benefits, or lost wages. In exchange for providing those benefits, employers generally cannot be sued in court for causing injuries.

While the system is supposed to be self-executing, injured workers hire attorneys when there are disputes over the amounts of benefits they should receive.

Florida businesses faced some of the highest workers' compensation costs in the country in the early 2000s. Business interests blamed attorney involvement --- legal fees in the aggregate totaled $427 million in fiscal year 2002-2003 --- for the high costs.

The Legislature responded by passing a sweeping rewrite of the workers' compensation system in 2003 that, among other things, tied the recovery of plaintiff attorneys' fees to percentages of the amount of recovered benefits. The law was tweaked in 2009 to make clear that workers' compensation judges were precluded from awarding additional hourly fees for plaintiffs' attorneys.

But in a 2016 decision in a case known as Castellanos v. Next Door Company, the Florida Supreme Court ruled that the restrictive fee caps violated injured workers' due process rights. The court authorized judges to award fees outside the fee schedule if adhering to it yielded unreasonable results.

Since the ruling, Florida business interests such as NFIB Florida have pushed state lawmakers to pass legislation limiting the amount plaintiffs’ attorneys can charge, warning that rates would skyrocket if nothing was done.

The Legislature didn’t pass a bill last year and Florida Insurance Commissioner David Altmaier in November approved a final order lowering premiums by nearly 10 percent.

Florida Workers Advocate, a group that represents workers’ compensation plaintiffs attorneys, issued a statement following Friday’s House vote saying the bill will ultimately hurt business “by delaying and denying the care their injured workers receive.”

Negron says it’s important to keep attorney fees down and notes that insurance companies spend more money to defend claims than injured workers spend on lawyers.

A recent report from the Judge of Compensation Claims shows that legal fees in the workers compensation system totaled nearly $440 million during the 2016-2017 fiscal year. The majority --- nearly $254 million --- was spent challenging workers' compensation claims.

“When I talk to employers they don’t care if it’s plaintiffs’ fees or defense fees,” Negron said. “They only want to pay attorneys fees that are necessary in the system. We want them to be as low as possible across the board.”