Senate Bill 1378 by Senate President Pro Tempore Brian Bingman, R-Sapulpa, passed Wednesday by a 27 to 17 margin in the Senate and was moved to the House.
House Bill 2155 by Speaker of the House Kris Steele, R-Shawnee, passed on Tuesday with bipartisan support on a 70 to 22 vote in the House and was moved to the Senate.
The two bills are both referred to as the “Oklahoma Employee Injury Benefit Act”.
Both bills began as identical measures but supporters of the bills say possible changes to them are being discussed by lawmakers. The bills were passed to meet a legislative deadline for considering measures.
Ultimately, one revised bill is expected to be drafted and sent to each chamber for a final vote.
The measures would allow qualifying employers to offer benefit plans regulated by the federal government under the Employee Retirement Income Security Act (ERISA) to provide medical and indemnity benefits to injured workers, as an alternative to workers' compensation.
The opt out provisions apply only to large employers with large incurred claims and an ex-mod greater than one.
Bill Minick, president of PartnerSource, a Dallas-based provider of services to Texas nonsubscribers, who has worked with OBIC on the legislation, told WorkCompCentral that the application to larger employers with high loss histories was to “deal with insurance carrier concerns” over “protecting their turf.”
Indeed, the primary objection to the Oklahoma voluntary bills is coming from the insurance industry according to the WorkCompCentral report.
Joe Woods, vice president and regional manager of Property Casualty Insurers Association of America (PCI) in Austin, said benefits under the opt-out plan for injured workers would be more limited than those provided through workers' compensation.
What's more, the legislation does not include an effective dispute resolution system, Woods said. "Everything would be done through arbitration," and the arbitrator could be a company employee, he said.
Woods said PCI also worries that allowing some businesses to set up alternative plans would damage future efforts to reform the system.
Under HB 2155, Oklahoma's larger employers could leave the system and lose their motivation for changing it -- while the smaller employers left in the system might "lack the political juice" needed to force changes, Woods said.
From my perspective much of what Woods claims is without foundation.
The legislation mandates that benefits be the same or greater than what is currently available under work comp - how is that limiting benefits that are more traditionally available to injured workers?
Some would argue that current dispute resolution through workers' compensation is ineffective with lengthly delays, extraneous attorney involvement and unnecessarily high costs. And I understand that the arbitration under the opt-out program is not binding, which means it can be appealed.
Finally, small businesses are nearly always left out of the bargaining process in attempts to "reform" workers' compensation - so how does the opt out provision change that?
Really, the big concern is pointed out by Bernie Hauder, a Dallas attorney who defends nonsubscribing employers in workplace injury suits.
He makes the very good point that allowing only employers with poor experience modifications to nonsubscribe creates an odd incentive for employers who don't qualify because of their good safety records.
"If you like this (alternative ERISA plan) and you're sitting there with a .95 experience modifier, what are you going to do? Do you go out and hurt someone?"
If Minick's allegation is correct, that this provision was put in to placate big insurance, then one has to wonder really who's interest big insurance really has in mind in objecting to the “Oklahoma Employee Injury Benefit Act”.
Another example of a special interest protecting its turf, except on the other side of the fence.
House Bill 2155 by Speaker of the House Kris Steele, R-Shawnee, passed on Tuesday with bipartisan support on a 70 to 22 vote in the House and was moved to the Senate.
The two bills are both referred to as the “Oklahoma Employee Injury Benefit Act”.
Both bills began as identical measures but supporters of the bills say possible changes to them are being discussed by lawmakers. The bills were passed to meet a legislative deadline for considering measures.
Ultimately, one revised bill is expected to be drafted and sent to each chamber for a final vote.
The measures would allow qualifying employers to offer benefit plans regulated by the federal government under the Employee Retirement Income Security Act (ERISA) to provide medical and indemnity benefits to injured workers, as an alternative to workers' compensation.
The opt out provisions apply only to large employers with large incurred claims and an ex-mod greater than one.
Bill Minick, president of PartnerSource, a Dallas-based provider of services to Texas nonsubscribers, who has worked with OBIC on the legislation, told WorkCompCentral that the application to larger employers with high loss histories was to “deal with insurance carrier concerns” over “protecting their turf.”
Indeed, the primary objection to the Oklahoma voluntary bills is coming from the insurance industry according to the WorkCompCentral report.
Joe Woods, vice president and regional manager of Property Casualty Insurers Association of America (PCI) in Austin, said benefits under the opt-out plan for injured workers would be more limited than those provided through workers' compensation.
What's more, the legislation does not include an effective dispute resolution system, Woods said. "Everything would be done through arbitration," and the arbitrator could be a company employee, he said.
Woods said PCI also worries that allowing some businesses to set up alternative plans would damage future efforts to reform the system.
Under HB 2155, Oklahoma's larger employers could leave the system and lose their motivation for changing it -- while the smaller employers left in the system might "lack the political juice" needed to force changes, Woods said.
From my perspective much of what Woods claims is without foundation.
The legislation mandates that benefits be the same or greater than what is currently available under work comp - how is that limiting benefits that are more traditionally available to injured workers?
Some would argue that current dispute resolution through workers' compensation is ineffective with lengthly delays, extraneous attorney involvement and unnecessarily high costs. And I understand that the arbitration under the opt-out program is not binding, which means it can be appealed.
Finally, small businesses are nearly always left out of the bargaining process in attempts to "reform" workers' compensation - so how does the opt out provision change that?
Really, the big concern is pointed out by Bernie Hauder, a Dallas attorney who defends nonsubscribing employers in workplace injury suits.
He makes the very good point that allowing only employers with poor experience modifications to nonsubscribe creates an odd incentive for employers who don't qualify because of their good safety records.
"If you like this (alternative ERISA plan) and you're sitting there with a .95 experience modifier, what are you going to do? Do you go out and hurt someone?"
If Minick's allegation is correct, that this provision was put in to placate big insurance, then one has to wonder really who's interest big insurance really has in mind in objecting to the “Oklahoma Employee Injury Benefit Act”.
Another example of a special interest protecting its turf, except on the other side of the fence.
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