The Kent Chamber of Commerce (Kent Chamber) represents 440 businesses with over 24,000 employees. The Kent Chamber of Commerce urges you to Vote YES on Initiative 1082.
The Washington State Office of Financial Management released its Fiscal Impact Statement analyzing Initiative 1082 as part of the state Voters’ Guide process. This report indicates that a vibrant competitive market for workers’ compensation insurance would be created if voters approve Initiative 1082. OFM predicts private insurers would acquire slightly more than half of the workers’ compensation market by 2014 as businesses flee the existing state-run monopoly. With a reduced case load “…state expenditures for claims cost would correspondingly decrease,” according to the report.
Washington is one of only four states with a government monopoly that forbids private competition for workers’ compensation insurance. While workers compensation taxes are falling around the country, Washington employers and workers were hit with a $117 million tax hike for 2010 – the highest increase since 2003. By comparison, Oregon has not increased its rates in the last 20 years and returned $100 million to its employers this year alone.
West Virginia privatized its workers compensation in 2006 similar to what is proposed in Initiative 1082. Since that time, workers’ compensation costs have decreased by 44 percent, saving West Virginia employers more than $150 million. Claim protests have fallen 68 percent, the overall appeals process has been streamlined resulting in claim disputes being resolved in shorter periods of time, claimants have received better claim management by claims adjusters having few claims to manage, 198 different workers’ compensation insurance companies have filed rates and forms and more than 90 percent of all claims are ruled upon within 30 days.
Furthermore, the Washington State Auditor’s report shows “a 74.4 percent chance of insolvency in the Accident Fund within two years…and 89.5% within five years.” In December, L&I admitted that the Accident Fund will be in the red by mid 2010 for an indeterminate period of time. Despite a 16% rate hike for 2010, the Supplemental Pension Fund ran out of money in April, forcing L&I to borrow millions that must be repaid with interest. Outside analysis shows it costs L&I $1.81 to run the system for every $1.00 of premium it collects. The best estimate is a 33 percent rate increase would be needed for the Accident Fund to break event – which equates to a half-billion dollar tax hike on employers and workers already struggling to make ends meet.
In Washington, the average injured worker with a time-loss claim missed 274 days of work – more than twice the average of states with private insurers. Oregon’s average time loss rate is about 70 days. We have the highest pension rate in the nation. More than 50 percent of injured workers are likely to receive a pension form L&I if they have been off work more than two years. In fact, pension rates are up more than 300 percent since 1996.
At the Kent Chamber of Commerce, we bring the business community together in dynamic, profitable ways. Whether members are networking with one another learning marketing tips and techniques, immersing themselves in issues that impact our businesses, or tapping into an array of educational services, we give local business owners the tools to help them thrive.
We urge you to Vote YES on Initiative 1082.
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