In old politics, like the old physics, every action seems to result in an equal and opposite reaction.
So when Republican members of the Senate Labor committee took to the editorial pages of the Seattle Times a few weeks ago pointing out problems with our workers' comp system, decrying the announced 2010 tax hike, and pointing out paths toward reform, this predictably provoked an opposing op-ed yesterday from the chair of that committee, Sen. Jeanne Kohl-Welles, D-Seattle, as well as her House counterpart, Steve Conway, D-Tacoma.
The gist of the Kohl-Welles/Conway op-ed: We have a great workers' comp system, the envy of the country, and its recent problems are attributable not to the system but to the recession. Businesses are just using the rate hike as a pretext to cut injured workers' benefits. The Chairs framed their message as an "honest discussion" about workers' compensation.
The truth, as usual, is more complex.
As AWB has noted before, of course the economy has reduced the system's investment and premium income, but more than anything that shows the extent to which good economic times mask our system's true costs, allowing good market returns to offset the true cost of workers' compensation. In a down economy, the chickens come home to roost, depleting the funds and causing tax rate surges at the worst possible time -- because of the system's underlying cost and benefit structure.
Also, writing on its blog, the Building Industry Association of Washington pointed out several troubling facts about our system's performance that were curiously omitted from yesterday's op-ed, like our nation-leading average of missed days from work, or our nation-leading number of lifelong pensions created each year, or our inflation-leading medical costs.
Our workers' comp system needs reform to remain sustainable - it lacks, for instance, the flexibility and tools other states have to deal with growing long-term liabilities and growth in medical costs - but that reform is not going to happen on the editorial pages of the state newspapers.
That's why it's encouraging that a bipartisan coalition of legislators is turning its attention to meaningful workers' comp reform. For example, speaking at last week's Aerospace Summit in Spokane, State Sen. Chris Marr had this to say:
In the area of worker’s compensation: labor, the trial bar and business need to come to an agreement that an average open claim of 282 days versus 76 days in other states creates huge administrative costs which don’t benefit injured workers or struggling employers. We need to enact the same compromise and release provisions as the other 49 states—and use those hundreds of millions in savings to reduce the costs of doing business in Washington. The risks of not acting are reduced benefits for future workers injured on the job, and fewer jobs for those who aren’t.
As Marr noted in a dispatch to the lobbying community last night, such talk is not without political risk. There are fortified interests defending the status quo, who are entrenched and anxious to anathematize anyone with heterodox views about our state's high benefits, high cost workers' comp system. But implicit in Marr's statement is the need to put aside the old politics on workers' comp because the risks of not acting are too high.
That's a bipartisan project and that's what an honest discussion about workers' comp reform will look like.
