TALLAHASSEE -- The state of Florida faces a number of challenges in reforming its workers' compensation system. But right now, one of the biggest hurdles is simply the stark differences between two proposed pieces of legislation pending in the Florida legislature's two chambers, and particularly the bills' handling of measures to tamp down the amounts able to be claimed by lawyers.
“The House and Senate bills are not similar, and in fact are very far apart,” Edie Ousley, vice president of Public Affairs for the Florida Chamber of Commerce, told the Florida Record. "The House bill doesn’t address the rising costs due to increased attorney fees.
"It can be challenging to pass legislation that includes so many different parties – injured workers, job creators, carriers, health care providers, attorneys -- and a 60-day legislative session is a tight timeline and uphill climb to get all of those stakeholders behind an effort.”
Bill Herle
With just days remaining in the current legislative session, Ousley is starting to feel like 2019 may not be the year for the kinds of reforms she’d like to see.
Despite a House panel recently approving proposal HB 1399, which could decrease workers’ compensation insurance rates for employers by as much as 5 percent, Senate Bill 1636 has yet to advance beyond committee hearing status.
Workers' comp reform has remained a hot topic in the state capitol since 2016, when the Florida Supreme Court and First District Court of Appeals ruled portions of the Sunshine State's system unconstitutional. Following those rulings, workers’ comp insurance rates jumped 14.5 percent.
"While Florida and the rest of the nation have enjoyed workers’ comp rate reductions as a result of safer work environments, Florida’s workers’ comp rates are still higher due to the court decision in Castellanos v. Next Door Company, which addressed attorney fees," Ousley said. "Unfortunately, this case has not resulted in additional benefits for the injured worker, but instead, redistributes additional income to attorneys.”
Bill Herrle, executive director of the National Federation of Independent Business in Florida, agrees that 2019 probably won’t be the year of the reforms as it relates to workmen’s comp, just as he agrees with Ousley about who has the most to gain from the system remaining unchanged.
“The real opposition comes from trial lawyers, not organized labor or any other body,” he said. “It’s the trial lawyers who make it difficult for legislation to move.”
Herrle said no one should be fooled how desperately reform legislation is needed by reports some insurance rates have recently been decreasing.
“First thing naysayers will point out is that rates are going down,” he said. “But some of the underlining health of the system is not good. We know attorney fees are increasing as a portion of overall cost; we know this is a very self-promoting part of the system and trial lawyers are trying to interject themselves even more. There is an all-time record amount going into system right now and jobs being created means we are paying more in workers comp premiums than ever before.
"That’s why rates are going down, not because trial lawyers are suing less.”
Under HB1399, most of the savings will come from the way insurance companies reimburse health care companies as core elements of the bill would cement payments at the same rates sat aside for Medicare recipients.
Those lobbying on behalf of the business community are pushing nonstop for the legislation to incorporate the same caps on fees that are charged by attorneys that are part of Senate Bill 1636, which would cap rates at $150 an hour or at an overall maximum of $1,500.
“Protecting injured workers and protecting Florida’s job creators is why the Florida Chamber has led the fight to lower workers’ compensation rates by nearly 60 percent since 2003,” Ousley said. “But when workers’ comp rates rise, Florida’s small businesses that create two of every three jobs in Florida are particularly impacted, often having to choose between higher rates and hiring employees."
Joining Ousley on the legislative battlefield is the Florida Justice Reform Institute (FJRI).
“Workers compensation reform is needed to contain costs for employers and employees,” FJRI President William Large told the Florida Record, adding: “The trial bar is against attorneys fee reform.”