Florida insurance regulators have squelched efforts to increase workers’ compensation premium rates by 1 percent, but indicated they’ll approve a 0.7 percent increase for 2014 which will keep the state competitive with other states and hopefully create more jobs by attracting new businesses.

The National Council on Compensation Insurance (NCCI), which cited increased costs in production expenses, proposed the rate hike. Florida Insurance Commissioner Kevin McCarty acknowledged increasing costs, but noted information submitted by NCCI failed to support a 1 percent increase.

Approval of the smaller increase in premium costs will mean Florida has effectively reduced premiums by 56 percent since 2003, when legislative insurance reforms were introduced. McCarty contends further premium reductions of more than 8 percent are in the offing if reimbursement for hospital inpatient, outpatient and ambulatory surgical centers can be legislatively capped at 120 percent of Medicare reimbursement.


State law requires all Florida businesses to carry workers’ compensation insurance, note attorneys at Johnson & Gilbert, serving the greater Daytona and Ormond Beach metropolitan areas. Designed to protect workers and their families if the worker is injured at work, it can be frustrating, especially in the wake of the reforms.

Acquiring compensation has been made more complicated, especially with permanent and temporary disability claims, advises the firm, which recommends working with legal counsel experienced in the process as soon as possible after an injury occurs.

While the increase will be the fourth in four years, the Florida market has become stable, according to Lori Lovgren, state government relations executive for NCCI, who notes there have been rate decreases over seven of the 10 years since reform and predicts there will be only minor changes in rates based on claims frequency and loss experience in the immediate future.

A market is considered “stable” if rates neither increase nor decline more than 5 percent, according to NCCI. A 1 percent bump could have increased employers’ cost as much as $20 million in additional premiums over the coming year, according to Commissioner McCarty, who says there are still opportunities to decrease costs. He praised Florida lawmakers for new legislation reducing and capping reimbursement rates for physician-dispensed pharmaceutical drugs, which he said could save employers $20 million.


He said other suggestions for reducing costs include limiting the amount of drugs physicians may distribute to patients to a three-day supply and creating a drug formulary or further lowering dispensing fees.

NCCI claims a 10 percent cut in facility costs has the potential to lower overall workers’ compensation rates by 3 percent and a 10 percent lowering of drug costs could produce another 1 percent in savings. The council says the latest filing indicates Florida’s economic recovery continues following the 2008 recession, and private insurers are expected to write more than $2 billion for the first time since then.

Before the legislative-mandated reforms, Florida workers’ comp premium rates ranked 23rd nationally.

Ormond Beach lawyers at Johnson & Gilbert, P.A., know how Florida’s workers’ compensation system works and have been helping clients submit successful claims for more than 15 years. If you’ve been injured at work in Florida, call them at 386.673.4412 or toll-free at 800.556.8890 for a free consultation.


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