Reds States Gutting Worker Comp Laws

In President Obama’s proposed budget for fiscal year 2016, OSHA would be funded at $592.1 million — which includes the following increases: $4 million for State Plan states; $18 million for federal enforcement; and $5 million for whistleblower protections. But as Safety and Health Magazine notes: "Where things get sticky in his proposal is under standards development and federal enforcement, for which the administration is seeking a $3.3 million and $17.6 million increase, respectively. Given the Republicans’ historically sour view of enforcement in favor of compliance assistance, I have a hard time seeing that dramatic rise happening."

As PoliticusUSA wrote in 2011: "It is understandable that business is not enamored with regulations, regulatory agencies, or in many cases their workers’ safety, especially when their sole regard is the bottom line. But their workforce is why they have a bottom line in the first place — and one would expect that ensuring the health and safety of the people making them millions would be every bit as important as profits; but apparently that is not always the case."

And as the National Law Review recently opined about the proposed budget increase for OSHA:

"As expected, the White House budget had Democrats praising it and Republicans expressing opposition. Senator Patty Murray (D-WA), ranking member on the Senate Committee on Health, Education, Labor and Pensions, described the White House proposal as “a strong starting point” for building a “bipartisan budget deal.” Representative Hal Rogers (R-KY), who chairs the House Appropriations Committee, called it "irresponsible." (More here at the OSHA law blog)

Congressional hearings will begin soon on the proposed increases in the OSHA budget, but we should all have a hard time seeing any increase for OSHA — especially when the GOP always wants to cut government agencies and programs that protect workers' health, safety and welfare — not to mention workers wages, workers' voting rights and workers' labor unions — such as with their so-called "Right to Work" laws. So OSHA should not see much, if any, increases. Odd, considering that, as the Daily Beast reminds us, it was the Republican President Richard Nixon, who not only signed into law the creation of the Environmental Protection Agency (EPA), but also created the Occupational Safety and Health Administration (OSHA) in 1971 — but these two government agencies have been under vigorous attack by the GOP in recent years, because they want to reduce the cost to businesses.

But that's not all. Republicans have also been dismantling worker comp laws as well. An investigation by ProPublica and NPR has found that Republican state legislators (on behalf of lobbyists working for their local chamber of commerce) have passed laws that cut worker compensation insurance benefits to save employers money. Because of this, now the U.S. taxpayers have to pick up the added costs in Social Security disability, Medicare and Medicaid.

Also, from a new 30-page report from OSHA (via the Center for Public Integrity) notes that:

Employer-provided workers’ compensation insurance benefits cover only 21 percent of the actual costs of a workplace injury or illness, including lost wages, medical expenses and rehabilitation. Only a fraction of workers apply for or receive benefits, the report says, because of job insecurity, fear of retaliation from employers, or because they don’t know they’re entitled to such benefits. As many as 97 percent of work-related illnesses go uncompensated because symptoms are often linked to workplace exposures long after employment ends, if they are linked at all. Most of the costs of injuries and illnesses are borne by workers themselves, according to the report. Government programs such as Social Security Disability Insurance and Medicaid cover 16 percent, private health insurance 13 percent ... The vulnerability is more pronounced in the modern workplace where contract and temporary workers who are often misclassified or assigned to new workplaces more frequently. Employers are often not responsible for insuring temporary workers – that falls to staffing agencies – meaning there’s little incentive to invest in training..."

Republican leaders don't like to see these kind of reports, and that's why they (working on behalf of these "job creators") wants to defund or eliminate agencies like OSHA, the National Labor Relations Board, the Equal Employment Opportunity Commission, the Department of Labor, the EPA (etc.) — and not INCREASE any their budgets.

Misclassifying workers as "independent contractors", engaging in wage theft, skirting environmental laws, and cutting worker compensation, is all part of the GOP's grand plan to destroy the middle-class and American workers for the greater benefit of corporate America and the top one percent. This is not ideological hyperbole or partisan hysterical rhetoric, this has been happening for decades.

The GOP is also going to try to cut Social Security disability, claiming increased costs and fraud (which is very little) while passing laws to increase the cost to disability by passing laws to gut workers comp. So basically, we have Republicans blaming Republicans for increases in costs to Social Security disability, Medicare and Medicaid.

Workers’ comp was born in the early 1900s as a “grand bargain” forged by business and labor as awareness grew about the grisly workplace accidents that came with industrialization. In return for a measure of a security, workers gave up their right to sue their employers — even in cases of gross negligence — protecting businesses from lawsuit judgments that could bankrupt them.

By 1920, nearly every state had enacted workers’ comp laws. The first national assessment of workers’ comp protections came in the early 1970s when Congress established a commission to study state laws as part of the Occupational Safety and Health Act. Convened by President Richard Nixon and led by John Burton, a Republican economist and law professor, the commission unanimously concluded that state laws were “inadequate and inequitable."

The commission made dozens of recommendations that laid the foundation for modern workers’ comp systems: Nearly every employee should be covered. Workers should be able to pick their own doctors. If employees couldn’t work, they should get two-thirds of their wages up to at least the state’s average wage. Compensation should last as long as the person is disabled, with no arbitrary caps. Spouses should receive death benefits until they remarry, children until they graduate college.

In 1972, the commission advised Congress to mandate 19 of these recommendations as minimum federal standards if states didn’t enact the provisions on their own. States quickly did.

But over time the political winds shifted. Over the past decade, state after state has been dismantling America’s workers’ comp system. After on-the-job injuries, workers often battle insurance companies for years to get the surgeries and prescriptions and that their doctors recommend.

On top of reducing benefits or capping the time injured workers can receive them, states have found another way to cut workers’ comp costs: shifting control over medical decisions from workers and their doctors to employers and their insurers. And some states has increased its use of outside medical reviewers who can deny recommended treatments — or rule that injuries aren’t work related after only brief exams, or by merely reading medical records.

The changes, often passed under the banner of “reform,” have been pushed by big businesses and insurance companies on the false premise that costs for workers’ compensation insurance are out of control. In fact, employers are paying the lowest rates for workers’ comp insurance since the 1970s. In 2013, insurers had their most profitable year in over a decade, bringing in a hefty 18 percent return.

All the while, employers have found someone else to foot the bill for workplace accidents: American taxpayers, who shell out tens of billions of dollars a year through Social Security Disability Insurance, Medicare and Medicaid for lost wages and medical costs not covered by workers’ comp.

The ProPublica and NPR investigation has found that since 2003, legislators in 33 states have passed workers’ comp laws that reduce benefits or make it more difficult for those with certain injuries and diseases to qualify for them. Many states have not only shrunk the payments to injured workers, they’ve also cut them off after an arbitrary time limit — even if workers haven’t recovered. Also, now employers and insurers increasingly control medical decisions, such as whether an injured worker needs surgery. In 37 states, workers can’t pick their own doctor or are restricted to a list provided by their employers.

Now only seven states follow at least 15 of the recommendations made during the Nixon administration. Four states comply with less than half of them. The scope of these changes, and the extent to which taxpayers are paying the costs of workplace accidents, has attracted almost no national attention, in part because the federal government stopped monitoring state workers’ comp laws more than a decade ago. The cuts have gone so deep in some states that judges (who hear workers’ comp cases) and top defense attorneys say they are inhumane.

Legislators who pushed through cuts in their states, however, insist they are necessary to keep and attract business. ProPublica’s review of workers’ comp changes nationwide found that many were steered by big business, aided by the recent Republican takeovers of state legislatures.

While rising medical expenses have long concerned insurers, the reforms were mostly driven by the recessions of 2001 and the recent Great Recession (2007-2009), which pitted states in a seemingly endless competition to lure business with lower costs. Even in states dominated by Democrats, worker advocates have been forced to make major concessions to achieve slight increases in benefits — sometimes just to keep up with inflation.

Few of the cuts in worker compensation insurance were driven by concerns about fraud, which is estimated to account for only a small percentage of the $60 billion spent on workers’ comp each year. And studies show most of the money lost to fraud is not from workers making false claims, but from employers misclassifying workers and underreporting payroll to get cheaper insurance rates. (The real fraud was committed by two well-known Republican governors were found to be implicated in Medicare fraud).

Recently, some judges have questioned whether states have cut too deeply in the name of saving employers money. In many states, few people — even the lawmakers who sponsored bills paring back benefits — seem to fully understand the bills’ impact on workers.

A study in 2007 by J. Paul Leigh, a health economist at the University of California, Davis, estimated that workers’ comp covered less than a third of injured workers’ medical costs and lost earnings — and that government programs like Social Security, Medicare and Medicaid have shelled out billions to fill part of the gap. The rest came from regular health and disability insurance — or out of workers’ pockets.

As OSHA concludes in their summary, "Despite a more-than-40-year-old legal obligation to provide safe workplaces, the unwillingness of many employers to prevent millions of work injuries and illnesses each year, and the failure of the broken workers’ compensation system to ensure that workers do not bear the costs of their injuries and illnesses, are truly adding inequality to injury."

And the taxpayers, as usual, are paying for these GOP policies — both in terms of dollars and lost limbs (etc.) due to work-related accidents.