Biz Rules

How to Manage Rising Workers' Comp Costs

The number of workers’ compensation claims in Florida increased 24 percent from May 2015 to May 2016 and premiums paid by Florida businesses rose 14.5 percent.

By Susan Burns July 19, 2017 Published in the July-August 2017 issue of Sarasota Magazine

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The number of workers’ compensation claims in Florida increased 24 percent from May 2015 to May 2016 and premiums paid by Florida businesses rose 14.5 percent. The reason for most of these increases? In April 2016, the Florida Supreme Court ruled that the mandatory payment schedule that dictated attorneys’ fees in workers’ compensation cases was unconstitutional.

The ruling stemmed from a case of an injured employee who needed an $800 MRI. The attorney in the case worked 107 hours and was paid $164, or $1.53 an hour. The mandatory payment system, the court ruled, made it difficult for deserving injured workers in small benefit cases to find an attorney to defend them, depriving them of due process. (In cases where the benefits are larger, $10,000 and above, the mandatory schedule allows for larger fees, and finding an attorney has not been an issue.)

During last spring’s legislative session, lawmakers tried but failed to pass a bill that would cap attorneys’ fees in workers’ comp cases. That means, for now, businesses must do what they can to reduce their costs and claims, says Amie Remington, general counsel for Landrum Human Resources, Inc., which has an office in Sarasota.

“Low value claims are getting attention now,” she says. “We’re telling clients to be actively engaged in the workers’ compensation process.”

First, try to avoid accidents by maintaining a safe work environment. If an accident occurs, employers should keep in touch with their workers and show their concern, which helps to cut down on lawsuits. “Tell them, ‘We’re so sorry you hurt your back. Keep us informed. Let us know how it’s going.’ It makes a huge difference,” says Pensacola attorney Colleen Cleary Ortiz, whose practice focuses on workers’ compensation defense.

Then get the injured worker back to work as quickly as possible to avoid driving up costs. Employers should look for a job that accommodates the injury and the doctor’s orders. “When employees sit at home, they get out of the groove of going to work,” says Cleary Ortiz. “If they’re out fewer than six weeks, they’re likely to return. If it’s more than six months, it drops to 50 percent of them ever returning. After a year, only 25 percent will return. In two years, it’s unlikely they’ll ever return.”

Finally, stay in close touch with the insurance carrier about every claim and make sure that the treatment is in line with the injury. Insurance risk managers may have more than a thousand claims. “And cases can get away from them,” says Cleary Ortiz. “You don’t want an adjuster paying for a psychiatrist to treat a foot injury.” 

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