Insurance Journal reports that the National Council of Compensation Insurance ("NCCI") is recommending rate increases in the Florida for the second year in a row.  

NCCI attributed this year’s increase to an upsurge in claims frequency and loss trends, which the organization said could be attributed to a weak economy. They also pointed out several problems with the system, including so-called pill-mills that allowed physicians to distribute drugs to injured workers from their office. In this year’s legislative session, lawmakers enacted a law prohibiting the practice.

NCCI also noted that the increase marked the end of cost savings from the 2003 reforms, which helped reduced employers’ rates by 64.7 percent between 2003 and 2010.

In what amounted to a rewrite of the state’s workers’ compensation statutes, lawmakers enacted a comprehensive set of reforms that touched on every aspect of the system. Among other things, it eliminated claimant attorneys’ hourly fees, reduced the number of construction exemptions, tightened the standards that injured workers had to meet to receive permanent wage loss benefits, and revamped the Florida Workers’ Compensation Joint Underwriting Association so that new businesses would have greater access to affordable coverage. The reforms also redistributed medical fees so that physicians earned more money, which was offset by reduced hospital costs.

Now, however, it appears the savings generated by those changes has been exhausted. “As a result, it has been necessary to adjust the very optimistic outlook, or trend, underlying rates, to reflect that significant experience improvements are no longer occurring and are no longer expected,” reported NCCI. 

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