Hawaii Proposes 16.8 Percent Workers’ Comp Loss Cost Decrease

The National Council on Compensation Insurance has filed a request to decrease workers’ compensation loss costs in Hawaii by 16.8 percent, beginning Jan. 1, 2008, according to the state Department of Commerce and Consumer Affairs.

DCCA said the reduction is based on the reduction in the number of claims filed in 2005, the most recent year data is available. In the past two years, Hawaii Insurance Commissioner J.P. Schmidt has approved decreases of 18.2 percent and 12.3 percent in loss costs as claims were reduced. A 3.9 percent increase was approved in 2006 because of increases in healthcare provider payments.

Hawaii has routinely had high workers’ compensation costs.

“Claim frequency has continued to drop due to the great efforts of Hawaii’s employers in providing a safer workplace for our workers,” Schmidt said. “We continue to make a concerted effort to encourage employers to implement workplace safety programs and thereby qualify for insurers’ discounts.”

Additionally, DCCA said the Department of Labor and Industrial Relations and the Hawaii Occupational Safety and Health Division have made strides toward partnering with employers and labor organizations in enforcing workplace safety and health laws.

“The DLIR continues to streamline and expedite the hearing process,” Schmidt said. “Claims are continuing to be resolved in a timely manner. However, we still need to work with the legislature to reduce the adversarial nature of the system and improve the quality of care to our injured workers.”

NCCI collects and validates data on workers’ comp premiums and loss experience. If the filing is approved, insurance companies can choose to adopt NCCI’s loss costs and then file their own factor for covering other components that make up the final premium.

Source: DCCA