Read a Pacific Northwest, liberal perspective on world, national, and local politics. From majestic Redmond, Washington - the Northwest Progressive Institute Advocate.

Tuesday, October 26, 2010

NO on I-1082: Reject the insurance industry's latest ploy to pad their profits at our expense

For nearly a hundred years, the workers’ compensation program in our state — commonly referred to as L&I after the Department of Labor & Industries, which runs it — has provided Washingtonians with insurance coverage for work-related injuries, lost-time compensation, medical care and other services.

The system currently covers approximately 171,000 employers and nearly eighty percent of Washington’s 3.2 million workers. About three hundred and fifty large employers (such as Boeing, Microsoft and Wal-Mart) opt out and run their own programs in accordance with state standards.

According to numbers provided by the Department of Labor & Industries, their administrative expenses were 17.5 percent of total benefits paid on claims for the period of 1999 to 2008 – about a quarter the national average.

Nonetheless, the system has long been criticized by the state's most powerful right wing lobby, the Building Industry Association of Washington (BIAW), for charging what they claim to be unnecessarily high premiums to businesses in order to offer what they consider to be overly-generous benefits to injured workers.

BIAW has repeatedly lobbied the Legislature to lower costs for employers by allowing early settlement of medical claims.

When those efforts failed earlier this year, BIAW drafted Initiative 1082, which basically stipulates that private insurance providers must be allowed to take over the system, arguing that profit-seeking companies would deliver efficiencies through competition that would benefit consumers.

Allowing private insurance providers access to the workers’ compensation market would certainly increase competition, but the point of industrial insurance is to provide protection to injured workers. It's not about making profits. The aim of I-1082 is to allow big insurers to make more money whilst failing to provide for adequate enforcement or regulatory oversights to protect the public interest.

I-1082 would jeopardize protections that we depend on if we get injured on the job. We know too well from experience how health insurance companies find ways to deny or delay paying claims.

Unfortunately, I-1082 fails to provide safeguards to prevent these kinds of problems. There would be no enforcement mechanisms to protect workers from delays during the claims process, and insurance companies could increase their rates without prior approval from the State Insurance Commissioner.

Of course, shortchanging consumers and injured workers is the only way that insurers would be able to make a profit offering industrial insurance on the private market; their overhead costs in marketing and executive compensation would make them less competitive than L&I, and they’d need to make up the difference somewhere. That’s why BIAW and the insurance industry have written so many gaping loopholes (wide enough to drive a truck through!) into I-1082.

Voters should also be concerned about what would happen if I-1082 were to pass and our state had to transition from a public to a private system. When Connecticut privatized payment of some claims, a private contractor hired college interns to do highly specialized work and charged the state $105 an hour for their time. The state Attorney General concluded that "privatization spawned inefficiency, incompetence and increased costs.”

Voters should be suspicious of wealthy corporations and lobbies that spend big to buy laws that stack the deck in their favor.

I-1082 seeks to dismantle a publicly-administered system that we the people, through our government, have some say over, and allow unaccountable corporations to take over and dictate things. As the old adage goes, it makes no sense to put the foxes in charge of the henhouse. Vote NO on I-1082 and help put a stop to one of the biggest corporate power grabs in Washington's history.


Post a Comment

<< Home