Massachusetts
Governor Deval Patrick Announces $11 MIL
Workers' Compensation Rate Cut for
Employers
BOSTON
– Thursday, April 17, 2008 – The Patrick Administration
today announced an agreement in the 2008
workers’ compensation rate setting
proceeding that will save Massachusetts
businesses $11 million. The new
rates average to a 1.0% reduction per
employer and mark the ninth time rates
have decreased since 1994.
“This
most recent rate cut balances the need to
help businesses control costs with the
responsibility to provide employees with
appropriate benefits,” said Governor
Patrick. “Lowering the cost of
workers’ compensation insurance is
very much in keeping with our larger goal
of improving the state’s business
climate so that we can grow the economy
and create jobs.”
The Workers’ Compensation Rating and
Inspection Bureau (WCRIB), a private,
non-profit association of insurers,
requested a 2.3% hike in 2008 workers’
compensation rates. Had the WCRIB
requests been approved, businesses would
have seen the cost of providing
compensation benefits to their employees
increase by $25 million. The
settlement signed today by Commissioner
Burnes and Attorney General Martha
Coakley calls for a 1.0% average rate
reduction. In addition, the
agreement further reduces average
rates for small businesses, resulting in
a statewide average rate reduction of
1.1% - a savings that amounts to
approximately $11 million for
Massachusetts employers. The new
rates go into effect on September 1,
2008.
“The Division of Insurance’s
objective is to ensure a fair and
equitable rate that protects workers
without overly burdening employers,”
said Commissioner Burnes. “The
2008 rate cut offers further proof that
reforms have created efficiencies within
the system that continue to produce
savings for businesses.”
As part of a
comprehensive overhaul of the workers’
compensation system in 1991, efficient
claims management, workplace safety and
return-to-work programs were increasingly
emphasized. Today’s reduction
marks the ninth time rates have been cut
since 1994 and reflects a total rate
decrease of 68% in that same period.
Secretary of Labor and Workforce
Development Suzanne M. Bump, who as
former co-chair of the legislative
Committee on Commerce and Labor, authored
the Commonwealth’s sweeping Workers’
Compensation Reform Act of 1991,
noted, “I applaud this
decision which stems from systemic
improvements made in 1991. We
are committed to placing a greater
emphasis on safety while continuing to
deliver compensation and medical care to
workers in a way that is also
cost-effective.”
Workers compensation insurance provides
coverage for lost wages, permanent
injuries resulting in loss of function
and medical care for workers injured on
the job. Massachusetts businesses
are required to carry workers’
compensation insurance. The
Division of Insurance sets the rates
after a rate setting proceeding.
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