NCCI Rates Okla. Workers’ Comp Plans

March 21, 2005

A national insurance consulting firm said a Republican-backed workers’ compensation reform plan for Oklahoma would reduce costs by up to $100 million more than a competing plan supported by Democratic Gov. Brad Henry, the Associated Press reported.

A spokesman for Henry disputed the analysis by the National Council on Compensation Insurance Inc. The director of the Office of State Finance, Scott Meacham, said the NCCI’s study was “extremely biased and severely flawed.”

The NCCI analyzed separate Senate- and House-passed workers’ compensation plans to reform Oklahoma’s quasi-judicial workers’ compensation system, which critics have said is too expensive and discourages employers from locating in the state.

The Boca Raton, Fla., company said the Senate bill that contains the governor’s proposal would reduce costs between 2.9 percent and 7.4 percent, or between $20 million and $51 million.

NCCI said the plan developed by GOP House Speaker Todd Hiett of Kellyville would cut costs between 10 percent and 22.7 percent, or between $70 million and $158 million.

Hiett and Sen. Scott Pruitt, R-Broken Arrow, said the studies confirm their plan will lead to greater cost savings than Henry’s, which narrowly passed the Senate.

“The bottom line to Oklahoma’s businesses and hardworking families is the crippling cost of our broken workers’ comp system,” Hiett said. “Oklahoma needs a plan that achieves significant cost savings.”

“We’ve been saying all along that our plan is real reform and provides significantly more savings than the governor’s watered-down plan,” Pruitt said.

Henry’s plan, based on recommendations of a bipartisan task force, does little to restrict legal costs, Hiett said.

“You can’t protect lawyers from reform like the Henry plan tries to do and still reach the kind of big workers’ comp savings we need in Oklahoma,” Pruitt said.

Critics of the Republican plan have said it does little to control spiraling medical costs.

Meacham said the analysis is biased and that an NCCI attorney was involved in drafting the speaker’s bill.

“We’ve been concerned for a long time about NCCI and their neutrality in this process,” Meacham said. Officials with NCCI did not immediately return telephone calls seeking comment.

The studies’ biggest flaw is that much of the savings in the House plan comes from barring injured workers from being compensated for certain types of claims, Meacham said.

For example, he said, workers who suffer on-the-job hernias can only be compensated if the injury happens suddenly, the worker is forced to leave work due to the injury and the worker seeks medical help within 72 hours.

He said the analysis also does not consider the cost of an ombudsman program proposed by Hiett to encourage mediation and the elimination of a medical fee schedule for physicians.

“They come up with excuse after excuse not to put values on things,” Meacham said. “I think these guys have some tremendous bias in this deal. We need to look at bottom line compensation.”

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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