An honest discussion about workers' compensation

WHAT if you were told you could sign up for a health-insurance plan whose premiums have increased by only 8 percent over the past five years?

Better yet, the plan's so good that during that time it gave customers a rate "holiday" of six months when they didn't have to pay anything saving them about $315 million.

You'd sign up, wouldn't you?

We ask because the state Department of Labor & Industries runs just such an insurance plan — our state's workers' compensation system. It's unjustly taking heat because of a recent proposal to raise rates despite performing at levels worthy of nationwide envy.

Workers' compensation is our safety net for families who lose their income because of work-related injury or illness. Sought by business interests a century ago, workers agreed to give up their right to sue their employers when they are injured at work in exchange for this no-fault insurance. It has since proved to be good for employers and employees alike.

In Washington, injured workers and their families get better benefits here than they do in most other states. And employers' costs are significantly lower, largely because of reduced overhead costs. Overhead costs in Washington's public workers' compensation system make up about 9-13 percent of all costs, a fraction of the 25-35 percent overhead most private plans charge.

The Oregon Department of Consumer and Business Services' comparison of the most-costly workers' compensation systems ranks Washington 38th. And workers here pay about 25 percent of those premiums, meaning that only four states have lower costs for employers. It's one of the reasons the Tax Foundation just moved Washington up three spots to the ninth-most-favorable business-tax climates in its annual rankings. Also, Forbes just named Washington the second-best state for business.

However, the national recession has done about $1 billion worth of damage to the workers' compensation trust fund. Investments have suffered, unemployment has increased, and work hours have been reduced. Ultimately, workers and employers are paying less to support the system.

Meanwhile, the health-care cost of treating injured workers is growing by about 8.5 percent a year. That's why the state just announced a proposed 7.6 percent premium increase for 2010. If approved following a series of public hearings, the increase would raise an additional $117 million to keep the system solvent.

To keep Washington's workers' compensation rates among the nation's lowest, we'll continue to pursue targeted improvements to enhance our system. For instance, we're fixing the glitches discovered last year in the Retro program, which rewards businesses that reduce on-the-job injuries. We're building on the best practices pioneered by our Centers of Occupational Health and Education (COHE) pilot projects, seeking to link doctors, employers and injured workers more efficiently and effectively. We're also rooting out fraud and ensuring the workers' compensation program strictly follows the spirit of the law.

Some argue the workers' compensation rate increase is evidence the system is broken and will seek changes that will cut injured workers' benefits to drop premiums even lower ["Fix Washington's failing workers' compensation system," guest commentary, Opinion, Sept. 24]. Such changes would be unfounded. The problem isn't the system, it's the recession.

Cutting benefits wouldn't constitute "reform." That would merely salt the open wounds of families who have lost their source of income at the worst possible time. Workers' compensation is about what is best for injured workers. Let's not forget, what helps injured workers get back to work helps their employers.

Let's retain our perspective and have an honest discussion about how we can make a system that's one of the best in the country even better for employers and workers alike.