Workers’ Compensation Hike
Please see below from Insurance Journal.
A Florida circuit judge has blocked a 14.5 percent workers’ compensation rate increase due to go into effect Dec. 1 after finding that the insurers’ rating organization and state officials did not comply with the state’s Sunshine Laws and open meeting requirements in setting the new rate.
On the day before Thanksgiving, Leon County Circuit Court Judge Karen Gievers ruled that the rate increase negotiated between the National Council on Compensation Insurance (NCCI), which represents insurers, and the state regulators within the Office of Insurance Regulation (OIR), cannot go into effect and that NCCI must turn over documents requested by the plaintiff in the case.
The Sunshine Law challenge was brought by James Fee, a Miami attorney who represents injured workers. Fee claimed, and the judge agreed, that NCCI was in violation of the Sunshine Laws in holding “multiple, non-public, secret meetings” internally and with the OIR over the rates.
NCCI claims it has complied with applicable open meeting and other Sunshine Laws on transparency and says it will appeal the ruling.
“NCCI is very disappointed in the decision of the Leon County Circuit Court. We continue to believe that NCCI and the Florida OIR have fully complied with the law. NCCI plans to appeal the trial court’s decision,” NCCI said in a statement.
Amy Bogner, spokesperson for the OIR, said the agency is still reviewing the ruling to determine the next steps.
Rate History
OIR conducted a public hearing on Aug. 6 on a 19.6 percent rate filing by NCCI.
On September 27, OIR and new Insurance Commissioner David Altmaier disapproved the proposed 19.6 percent rate hike sought by NCCI. At the time, OIR told NCCI it would approve a 14.5 percent increase if NCCI refiled by Oct. 4. NCCI did and the official OIR approval came on Oct. 5.
However Judge Gievers found that prior to that Aug. 6 public hearing and then after it until refiling in October, NCCI conducted internal meetings and held discussions with OIR staff that were not open to the public and for which no minutes were kept. The judge said NCCI also withheld documents from the plaintiff, denying him the opportunity to fully participate in the Aug. 6 public meeting.
Gievers said NCCI “tried to delegate its way out of the Sunshine” by claiming to have assigned one actuary to handle the filing rather than a committee as cited in the Sunshine Laws but the judge said NCCI’s approach “clearly involves” committees.
NCCI’s rate filing was originally submitted in May of this year and then amended in June to address the impact of two Florida Supreme court case decisions (Castellanos v. Next Door Company and Westphal v. City of St. Petersburg) and legislatively-mandated updates to the Florida Workers’ Compensation Health Care Provider Reimbursement Manual. The Castellanos ruling invalidated the state’s mandatory attorney fee schedule, while Westphal ruling found the 104-week statutory limitation on temporary total disability benefits unconstitutional.
The rate increase was slated to become effective on Dec. 1 for new and renewal business, with no change in rates for current in-force policies.
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