WCA Responds to PERMA Propaganda

On February 22, 2012, an arm of Public Employers Risk Management Association (PERMA) released a “report” claiming that workers' compensation assessments are a “tax” that is dramatically increases employer costs. This “report” was filled with misleading statistics and misinformation. Because sound public policy must be based on facts, not propaganda, the WCA has released a report that sets the record straight.

The key points of the WCA report are:

- Assessments are not a “tax.” In fact, the opposite is true – assessments exist so that New Yorkers are not taxed to run the workers' compensation system. Instead, employers and insurers who benefit from the system – in many cases receiving cash reimbursement or passing on liability to Special Funds – pay the costs of running the system.

- Assessments are not skyrocketing. Assessments – which are set by CIRB, an agent of the insurance industry, not the Workers' Compensation Board.

– Assessments have historically fluctuated within a relatively narrow range, and they remain within that range today.

- Almost 80% of assessments go to two Special Funds, which make payments to employers and insurers and take over responsibility for old claims from them. One of those funds has already been eliminated, and eventually the assessment for that fund will drop to zero. The WCA believes that the other fund should also be eliminated – even though PERMA did not call for that action.

- The Special Funds send money back to employers out of the assessments they receive. In many cases, employers receive more money back from the Special Funds than the assessments they pay. PERMA only wants to count the money it pays in assessments, ignoring the money it gets back.  Of course, that only provides half of the picture about its net costs – if there are any.

You can read the full WCA report here.

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