Workers’ compensation insurance is the mandatory coverage that pays when employees are injured or killed at work, and that covers at least some lost pay when they can’t work. It also covers some occupational diseases.
Because almost all employers have to have coverage, the state regulates costs.
The State Corporation Commission is charged with assuring that employers are not overcharged, by reviewing the biggest element of premium rates, the portion that covers claims.
The basic approach is to look at recent expenses of claims and projecting trends from these into the future.
In addition to the SCC, since 2018, the state Workers’ Compensation Commission has posted a medical fee schedule that, much as Medicare and Medicaid do, details what doctors, hospitals and other health care providers can charge for various treatments.
That regularly updated fee schedule is a big reason why the National Council on Compensation Insurance is asking the State Corporation Commission to approve an average 6.8% drop in basic rates for the voluntary market – that is, for the policies that cover most employers.
In addition, the number of claims because of lost time at work was down from the trend of the past eight years, the council told the SCC.
The council is also asking the commission to approve a 2.9% decline in the assigned risk rates, which are for firms that see lots of claims and that can’t otherwise get coverage.
The council’s advisory rates cover the bulk of what insurers will eventually charge – they are used by insurers as a basic guide to the cost of covering claims, while the companies are free to base their actual charges on their own judgement about profits and any funds to cover the unexpected.
If approved, the rates would cover new workers’ comp policies or renewals from April 1, 2023.
The council’s request is based on what insurers received in premiums and spent on claims payments in 2019 and 2020.
It did not use any COVID-19 related claims from that time since these did not result in many claims from people who were able to show they caught the virus at work. There were 84 such claims in 2019 and 216 in 2020.
Virginia’s workers’ comp rates are among the lowest in the nation, with one estimate putting them some 32% below the national average.
Bringing inflation under control doesn’t automatically mean the national economy will enter recession, much less a severe one, the leader of the Federal Reserve Bank of Richmond said Wednesday.
The day after the Federal Reserve Bank dramatically raised a key interest rate to curb inflation, Virginia politicians and economists looked for a path to lower gas and food prices, stronger domestic supply chains and an economy that’s growing instead of shrinking.
