National Council on Compensation Insurance claims Okla. House bill

Journal Record, The (Oklahoma City), Mar 21, 2005 by Janice Francis-Smith

Speaker of the House Todd Hiett's version of workers compensation reform would save three times as much as the Senate version, according to The National Council on Compensation Insurance, based in Florida.

NCCI conducted an analysis of both House Bill 2046, by Hiett, R- Kellyville, and Senate Bill 846, by Sen. Charlie Laster, D-Shawnee. The Senate bill is endorsed by Gov. Brad Henry.

According to NCCI's analysis, SB 846 would reduce overall workers compensation system costs in Oklahoma by between 2.9 percent and 7.4 percent, saving $20 million to $51 million. On the other hand, HB 2046 would reduce system costs by 10 percent to 22.7 percent, saving between $70 million and $158 million, according to the analysis.

Hiett said the difference is that Henry's plan does nothing to address litigation costs.

Even in areas addressed by both bills, NCCI credited HB 2046 with greater savings.

For instance, the portion of SB 846 that would clarify compensability for permanent partial disability would decrease system costs by between 0.3 percent and 1.1 percent, according to the analysis, while HB 2046's method of determining eligibility for permanent partial disability benefits would decrease costs by between 4.4 percent and 9.3 percent.

The lack of an effective date for a change in permanent total disability benefits for widowers could allow the benefit to be paid retroactively, resulting in a one-time, unfunded liability for employers of up to $4 million, according to NCCI.

State Finance Director Scott Meacham said the analyses are both biased and flawed.

We've been somewhat concerned about the bias factor ever since we heard that one of (NCCI's) local attorneys was assisting in the drafting of the House bill, said Meacham.

In the analysis of SB 846, they come up with excuses not to value things, said Meacham, and completely ignore a few provisions of the bill that could offer savings. Conversely, he said the analysis of HB 2046 does not provide any cost estimate for implementing an ombudsman program. Eliminating the medical fee schedule will cost self-insured companies a lot more. Plus, injured workers whose injuries are not compensable under the workers comp system will simply take their cases to court, driving up tort costs.

The governor's office may seek an impartial party to conduct a similar analysis of the two bills, he said.