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Triage for a sick system

The diagnosis is unanimous: Florida's workers compensation system has some of the highest costs, lowest benefits and biggest problems. What's the cure?

By JEFF HARRINGTON, Times Staff Writer
© St. Petersburg Times
published November 24, 2002

Florida's workers compensation system looks to experts on all sides like a train smashing into the middle of a car wreck during a hurricane.

The state program to handle claims from injured workers is broken so badly and in so many places that nearly everyone seems to come out on the losing end:

-- Florida businesses pay among the highest rates in the country to insure their employees for on-the-job injuries.

-- Benefits paid to injured employees are among the lowest in the country.

-- More insurance companies are refusing to write workers comp policies, calling them a money-losing proposition. One industry study estimates that workers comp costs were 127 percent of the premiums paid in.

-- And increasingly, many small businesses say they are unable to find coverage or to pay for it.

No one feels the frustration more than those the system was created for: injured workers such as Charla Bird-Ross.

Eight years ago, Bird-Ross was a schoolteacher in Tampa working with emotionally handicapped and autistic children. She recalls in anger the fall day she was "beaten and left for dead" in her classroom by a troubled teen. Both knees were shattered. Two discs were ruptured in her lower back and five in her neck. Her rotator cuff was torn. Her skull was fractured, causing a concussion.

Her trail to recovery continues today, weaving through a workers comp network that has delayed her benefits, challenged her medical claims and sent her to network-paid and network-recommended psychiatrists who challenged the extent of her injuries.

One workers comp representative deemed the schoolteacher fit to go back to work the same week she was scheduled for surgery on both knees.

"There are people who milk the system," Bird-Ross said, "but for those who have truly legitimate problems, it's a travesty."

State regulators say they have gotten the message.

Rallying around pleas for a broad solution to the workers comp mess, the Republican-led Legislature is crafting an overhaul that includes putting more decisionmaking in the hands of doctors and medical peer review panels, de-emphasizing litigation and improving benefit plans.

But the changes also may make it tougher for workers to prove an injury.

Tallahassee's momentum for a make over may be driven more by businesses complaining about rising rates than by the chronic complaints of injured workers. Regardless, there is a sense of urgency to change.

"We can't continue a system where the answer to the problem is to raise rates," said Florida Insurance Commissioner Tom Gallagher, who is calling for a special legislative session on workers comp.

Perpetually raising rates "is fine for the carriers," Gallagher added. "They don't care what the rates are. But it's not acceptable to the economy and to the businesses of this state. We already have some of the highest premiums and some of the lowest benefits."

The National Council on Compensation Insurance, an organization that submits rate requests on behalf of insurance companies that write workers' compensation coverage, requested a 21.5 percent statewide average increase in premiums in August. Gallagher has proposed an 11.9 percent increase effective next April.

The average workers compensation rate in Florida for all types of employers is $4.08 per $100 of payroll. Put another way, about 4 percent of an employer's payroll goes toward coverage. With an 11.9 percent increase, that would rise to $4.57 per $100 of payroll.

Gallagher's fellow Republicans, including Gov. Jeb Bush, question the need for a special session. But Bush has acknowledged that previous workers comp fixes have fallen short. In May, he appointed a special commission to consider reforms.

The governor's commission is slated to make its recommendations in January, likely forming the basis of a new bill for the Legislature next spring.

A coalition of businesses and insurance companies has been lobbying the commission to eliminate hourly fees for workers' attorneys, cut back on companies that are exempted from carrying workers comp insurance, and redistribute benefits so that the total number of permanent claims would decrease.

Advocates for workers comp recipients are pushing for more independent physicians who aren't chosen by the insurers, improved benefits and help for workers seeking legal support when they believe their claims are unfairly denied.

Yet both sides predict Tallahassee's blueprint for reform will likely be closest to recent recommendations of a three-member state panel. The panel, headed by Gallagher, this month outlined a package that would make it harder for workers to shop for doctors and would steer disputes toward medical review boards instead of the courts. The panel also is urging the creation of a standard form required for all injured workers so the state can track and compare every case.

Gallagher said he wants "return-to-work incentives" to spur workers to get back on the job as soon as possible and disincentives for those companies that refuse to take employees back.

He'd also like to get more fraud investigators. In July, when the state division of workers comp shifted from the Labor Department to the Insurance Department, Gallagher found he had about 160 fewer positions than the 480 previously budgeted, including fewer fraud investigators. The agency has 35 fraud investigators and seven supervisors to look for bad apples. So far this year, the fraud team has 196 open cases and has made 51 arrests.

One ironic cause of the state's high rates: Florida has some of the highest expenses of any state to provide medical cost-containment services such as bill review and case management. A survey of eight states by the Workers Compensation Research Institute two years ago also found Florida paid attorney fees of $2,504 per claim, the highest in the survey and about one-third higher than the state average.

In previous years, the state legislature has tried to change pieces of workers comp -- such as curbing lawyer fees -- with limited success.

"The goal can't be to hurt the attorneys or anyone else," Gallagher said. "Everybody wants to point a finger at somebody else causing the problem, and I don't think that's a way to find a solution."

Gallagher insisted what is needed is a complete overhaul with all interested parties brought to the table.

So far, though, victims' advocates don't like where their place is at the table. They complain about getting short shrift in appearances before the governor's commission, and they fear any "reform" by state legislators will wind up making it harder for injured workers to sue for relief.

"They're really trying to fix it so we can't get access to an attorney," said Mary Bailey of VOICES, an advocacy group representing injured workers. "The main issue that drives an injured worker to get an attorney is they're trying to get back to work and can't."

Rather than set up new doctor review panels, Bailey said the most important and effective solution to the crisis "would be just to enforce the laws, which they refuse to do."

She said a bias against workers is reflected in the makeup of the governor's commission.

The 13-member group includes representatives of the insurance industry and other businesses, politicians, bureaucrats, union leaders and even workers comp attorneys. But pleas to include a direct representative of injured workers from an organization like VOICES went unheeded.

"Because the Republicans won, probably we're the ones who are going to lose, and we're the ones who always lose," Bailey said. "This is hurting everyone, everyone but the insurance industry."

-- Jeff Harrington can be reached at or (813) 226-3407.

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