AIF Task Force Looks to Reform Workers’ Comp in the Sunshine State

Tallahassee, FLA (WorkersCompensation.com) - While a task force promises to help save Florida's workers' compensation woes, some experts say the heroic efforts may not be enough — or rather — come in enough time.

Since Tom Feeney, president and CEO of Associated Industries of Florida (AIF), announced Tuesday that a strategic task force, made up of esteemed members of Florida's business community, are taking their findings to the State House, many are wondering if it will work. "We put our blood, sweat and tears into this collaborative effort to consider all aspects of the Workers’ Compensation Act in Florida and help restore a stable, self-executing and affordable system to care for injured workers,” Feeney said in a press release Tuesday.

Michael Ortoll, founder of iPEO and JV partner at BKS-Partners, out of Tampa, supports the AIF's efforts, but said there will be no immediate results from the proposed reform. "I think it will over time," he said of the proposed legislation that will soon lay on the desk of Gov. Rick Scott.

Citing a 2016 National Council on Compensation Insurance study, the AIF reports that since "the December 2016 14.5-percent rate increase went into effect, Florida has jumped ten states and is ranked 23 out of 51 states in terms of workers’ compensation rates, with the primary cost driver being the Florida Supreme Court’s decision on attorneys’ fees."

Under the task force's proposal, "employees are free to retain their own attorneys, while the Workers’ Compensation Act will remain intact, expediting the resolution of outstanding cases/issues to avoid a costly and prolonged litigation process," according to the AIF press release. Also under the proposal, "injured workers will be attended to by the appropriate medical providers quicker based on mandatory state oversight," as well as "unnecessary litigation will be avoided," and "personal information of injured workers would not be publicized."

Though the future of the proposed legislation is unclear, one thing that's certain is "this year more businesses than ever are going to be looking at their workers' comp and their employee benefits with a lot of diligence," according to Ortoll, who added things "were good until a couple of years ago."

"From 2003 until last year, rates went down almost 60 percent and that's because it was working," he said, noting that Florida carries the same rates across the board. "Over the last couple of years, unbeknownst to many, there were two crucial Florida Supreme Court hearings that went sideways on the industry."

Ortoll said by going sideways, plaintiff's attorney bills were no longer curbed or scaled back, and it cost the industry tens of millions of dollars each year.

But the task force's fear of failure is minimal even against the odds noted.

“We believe that under this united business effort, this product will deal with the catastrophic threat head on that has been created by the current legal environment that is hurting the workers’ compensation system, which has worked since the 2003 reforms," he said.

According to Bob Wilson, CEO and president of WorkersCompensation.com, workers' compensation reform should not just be about looking at the past fifteen years, but rather that the industry itself "needs cultural reform in order to adapt to, and manage, the new economy and the different societal expectations than that which existed 100 years ago when the system was first created.”

"In Florida, the proposed legislation I see thus far is primarily looking to address the problem of attorney fees and the fee structure that is used to compensate an attorney," he said. "It appears to me the legislation that is proposed will not reduce any potential conflict within the system. If they really wanted effective reforms they would come up with something that would reduce the conflict that leads to litigation. That effort would best control costs and eliminate the source of expense drivers, in my opinion."

Principal Walt Capell and Sales Manager Tim Davis with The Insurance Shop, agree. "State politicians in Florida are hearing about this issue from the insurance and the business communities. This will more than likely cause the legislature to make drastic changes to the system," said Capell, with the Columbia, MO firm. "Many carriers are shrinking their appetite for many industries until this issue is dealt with. This is making it more difficult and more expensive to find coverage for business owners. Until there is a solution in place, this will continue." 

"Most expect the legislature to address this in the first quarter of 2017," Davis said.

"This may be in part to the specific industry, but it very likely could be due to the instability in the system," Capell said.

There is hope though, according to Wilson, but it lies on a bigger scale than the Sunshine State. "I would agree that Florida's comp [system] needs reform. We have some problems in the state, but these are not necessarily just issues that are related to Florida, and they require broader reforms than today's politicians are willing to look at," he added.

Share This Article: