ALBANY ? Aides to Gov. Andrew Cuomo approved a 9.5 percent increase in workers compensation rates last week, but estimated the actual increase to employers will be less than 3 percent as a result of reforms put in place this spring.
The New York Compensation Insurance Rating Board originally sought a 16.9 percent "loss cost" hike, the overall projected cost increase for covering workers comp claims in the coming year. But the amount was reduced to below 10 percent after a hearing conducted by Cuomo's Department of Financial Services. When reforms adopted as part of the 2013-14 state budget are phased in, the increase should be in the range of 2.8 percent, DFS said.
"A 9.5 percent increase would alleviate the impact of the cost increases identified in NYCIRB?s filing, and the supporting submissions and testimony, while, when combined with the anticipated 2014 New York State assessment reductions (resulting in a further 6.7 percent decrease in policyholder costs), limit the overall projected cost increase passed on to policyholders to approximately 2.8," DFS commissioner Ben Lawsky, a top Cuomo aide, said in a decision released last week.
New York is one of the most expensive states in the U.S. when it comes to the cost of the workers compensation for employers. A study released last fall by the Oregon Department of Consumer and Business Services put New York in 5th place as the most expensive workers comp system in the U.S., behind Alaska, Connecticut, California and Illinois. The cost to New York employers was put at $2.82 per $100 of payroll, compared to a national median cost of $1.88.
Friday, business groups credited Cuomo for the reforms put in the new budget back in March. They followed earlier reforms put in place by former Gov. Eliot Spitzer in 2007.
The new budget called for eliminating a whole series of workers comp business tax assessments and merging the costs into a single assessment.
"The Department of Financial Services has recognized the increases in costs in the system and that?s reflected in a realistic loss cost," Business Council workers comp specialist Lev Ginsberg said. "The Business Council remains committed to working with the administration and the Workers Comp Board to further reform the workers comp system and realize greater costs savings and hopefully lower workers comp insurance costs in the future."
Mike Durant of the National Federation of Independent Business also credited Cuomo for pushing through the reforms. He said the NFIB would continue to work with Cuomo to "make regulatory fixes to help drive down the costs so that the pressure is eliminated on the employers as well as the insurance industry."
Source: http://www.troyrecord.com/articles/2013/07/21/news/doc51eb855de7f20520656002.txt
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