TALLAHASSEE, Fla. – State lawmakers got a preview of the biggest legislative battle on the horizon early this month.
Businesses across Florida are unhappy about a coming 14.5 percent hike in the cost of workers compensation insurance. Both businesses and labor advocates are blaming legal fees for the spike.
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Florida is one of just nine states that does not allow completion in workers comp coverage. Rates are recommended by an industry-controlled panel. Legal fees for companies fighting claims make up about two-thirds of all legal fees paid.
The 14.5 percent hike applies to all new and renewing policies. It has business trade groups up in arms.
“This isn’t to help workers get healthier,” Brewster Bevis, of Associated Industries of Florida, said.
The hikes also affect local governments.
“Our workers comp program will cost us approximately 650 percent more,” Bay County risk manager Eve Tooley said.
“The Supreme Court threw the old law out because its capped attorneys fees. In one case, lawyers were working for $1.50 an hour.
The states business trade groups say employees' lawyers are greedy.
"Look, I don't think that court decision had anything to do with keeping workers healthy," Bevis said. "I think it had to do more with making attorneys more wealthy.”
Trial lawyers said they wouldn’t be needed if insurers stopped denying claims.
“Attorney fees don’t attach until I prove my case,” attorney Kimberly Syfrett said.
And in a preview of the rancor to come, the two sides squared off over what was supposed to be merely an informational Senate meeting.
“Does AIF believe that those prevailing plaintiff fees should be included in the rate-making base?” Sen. Gary Farmer asked.
“Absolutely," Jim McConnaughhay, with Associated Industries of Florida, said. "It’s a cost to industry. Absolutely.”
“Even though it’s industry's fault they were incurred?” Farmer asked.
"You know whether they were rightfully or wrongfully denied, it was determined by some judge that they should be paid,” McConnaughhay said.
Farmer argued that by counting insurers' legal fees as an expense, there is no incentive to pay claims, because they profit the same either way.
Businesses said if fees aren’t controlled, we all pay.