Governor-elect John Kasich announced on Tuesday the appointment of state senator John Buehrer to head the Bureau of Workers’ Compensation effective January 10, 2010. In announcing his decision, Kasich stated that the Bureau is a problem that needs to be fixed.
We have heard this again and again from Kasich on the campaign trail. As we have suggested in our previous blog dated September 7th, , then candidate George Voinovich in 1992 announced his intention on fixing Workers’ Compensation, “the silent killer of jobs.” Governor Voinovich and his anointed successor, Bob Taft, during the 16 years of their leadership, passed a series of reforms to “fix” Workers’ Compensation.
So if Ohio has made great strides in reducing employer premiums, what more is there to fix? One of the issues suggested by Governor-elect Kasich is that there exists a “roller-coaster” ride of premium increases/decreases for small businesses.
Why would there be a roller-coaster ride of premiums? One of the “reforms” instituted during the Voinovich-Taft years was the creation of a group rating system. Simply put, the group rating system allows employers to group together to allow lower premiums across the entire group. The premiums for group-rated employers are lower because the premiums are determined based upon the group workers’ compensation claims, as opposed to a single employer’s claims. The problem with group rating is that the premiums incurred by the group are artificially low. While artificially low, one single workers’ compensation claim would cause an employer to be “kicked out” of the group, resulting in extreme increase in premiums.
So if the system isn’t truly broken based upon current data, and the group rating system was one of the “reforms” instituted by previous Republican administrations, why the cry for an overhaul?
It is again our belief that this is all a smoke and mirrors campaign in favor of privatization. Knowing that the voters overwhelming voted against privitization in 1983, calling the system “broken” and “in need of overhaul” (when it appears not to be the case) gives the Kasich administration a rallying cry to attempt privatization once again.
Privatization would be a big loser for injured workers. If Ohio follows the system in Indiana, the employer/insurer controls where the injured worker treats. Currently, Ohio law guarantees the right of free choice of physician. By controling where an injured worker can treat, the employer can control what kind of treatment an injured worker obtains. Moreover, a private for-profit insurance company, whose last interest is treating injured workers fairly, would be the administrator of the employer’s workers’ compensation claims, rather than a non-profit state agency whose interest presumably is treating employers and employees fairly. This is the very reason why the Ohio constitution was written to prohibit private entities from providing workers’ compensation benefits.
So calling the system broken and in need of overhaul is simply a way to transfer business from a non-profit state agency to private companies whose sole interest is accumulation of profit–profit which can be used as campaign contributions to candidates that support the insurance company’s business interests.
Does this sound as familiar to you as it does to us? Isn’t this yet another way in politics to reward your friends and punish your enemies?