As I type this I'm on a Southwest flight to Dallas. I was practicing the delivery of my presentation to the PartnerSource Non-subscription conference but got interrupted by distracting thought.
That seems to happen a lot to me...
In any case, you likely know that Texas is the only state in the country for which workers' compensation is voluntary. Employers that opt not to enlist in the workers' compensation system of that state are known to "go bare", and are more officially called "non-subscribers."
There may be a few small businesses that "go bare" but for the most part, non-subscription is the purview of large employers which have the resources to develop alternative risk management systems.
These large employers have operations in many states usually, and so the attendees at the PartnerSource conference are generally familiar with workers' compensation.
And for the most part, these risk managers love their non-subscription programs because they deliver superior results than the compulsory workers' compensation systems they manage in the rest of the United States.
Superior cost savings, faster return to work, and happier more productive employees are cited as non-subscription benefits over the risk of civil liability exposure. Ironically, I believe that non-subscription in Texas also makes that state's workers' compensation system more effective as well, because it has to compete with non-subscription so there is motivation for the system to work better and deliver good results, for employers, employees, and carriers.
I may be wrong because I don't have the data in front of me at 35,000 feet (no wi-fi, and if there was my staff would probably kill me!), but if my memory serves correct Texas is one of the very few states where carriers consistently post combined ratios below 100%, providing the insurance industry there underwriting profits in addition to the more typical carrier profit line of investments.
The attendees at the PartnerSource conference want to know how to get non-subscription to other states where they operate. They are passionate about non-subscription, the control it gives them over the entire worker benefit delivery system, and the competitive enhancement their businesses experience because of the lower costs and higher productivity they experience.
I don't know if this is where the trend is going in work injury protection, but there is certainly increased scrutiny of workers' compensation's joint promises of employer protection from civil liability and expedient delivery of worker medical treatment and income protection.
The law generally lags society by a wide margin. In our context for instance, the change from an agrarian society to industrialization started during the Civil War, but workers' compensation in its modern form didn't really get going until after 1917 when compulsory work comp was ruled constitutional by the US Supreme Court.
Even then it took another 40 years for all the states to provide workers' compensation, Mississippi being the final state in 1949.
That's about when computers started creeping into society. Big, huge, monolithic machines of tubes and wire miraculously performing mathematical computations that fascinated the world quickly became smaller, faster, lighter at an ever quickening pace.
I still remember my first notebook computer - a 386 with maybe 2 megabytes of random access memory and maybe 20 megabytes of disc storage running DOS on a monochrome screen with than damned blinking green cursor, and weighing about 10 pounds. That was 1984.
I'm typing this post on a MacBook Air with 256 GIGABYTES of solid state storage, 4 GIGABYTES of RAM, with an amazingly clear full color display on the most modern operating system architecture yet, weighing less than 3 pounds, all at a cost that is far less than the inflation adjusted cost of that first notebook. I forgot any DOS commands about 20 years ago…
And I'm not even going to get into all the other information devices we now take for granted like smart phones, tablets, and other portable systems.
We have migrated as a society at large from industrialization to informationalization in the span of about 40 years. And our economy has reflected this social shift as well - the United States may not produce much steel any more, but it is still the leader in making ideas by a wide margin.
The point is that it took about 80 years for society's laws to catch up to the change from agriculture to industrialization. I think we are seeing a more rapid pace of change in our laws catching up to the social move towards the Information Age, but I truly believe that this is an unstoppable trend.
Change won't happen overnight, but change IS going to happen. I am convinced of that.
Non-subscription is a part of that change. You can participate and prepare for that change and help sculpt the model, or you can go down with the sinking ship.
There's an old military saying: Lead, follow or get out of the way.
Whatever path, it's your choice.
workers compensation, work comp, injured worker