Tuesday, November 3, 2009

A Fool's Gambit

When it comes to workers' compensation reform, why or why can't we be more like Texas. . .or Kansas. . .or Missouri. . .or this time, Arkansas? Well, take your pick, because yet another state by state scorecard for workers' compensation has been published. Read the analysis and conclusions in Risk and Insurance, one of my favorite websites.

When ranked in the categories of Low Lost Time Frequency, Short Duration of Disability, High Benefit Generosity, Low Insurance Cost, the states received a letter grade and a composite ranking from 1 to 9. Oklahoma ranked 7 (C+).

But look, Arkansas ranks 3 (A-). Isn't a group working on a "modified" Arkansas plan for another round of workers' comp reform. Did anyone notice that Arkansas ranks near the bottom for injury benefits? Only seven states have lower benefit rankings. It sounds so high-minded to say we will scrap the old system for a new high performing one that moves us to the head of the class. But what are the hidden costs and tradeoffs? For Arkansas low benefits (C) equals low costs(A+). Sounds easy.

What about the number one state, Massachusetts? It has high benefits (A+) and low cost (A+). They have worked at improving their system for 15 years, starting under Republican governor William Weld --- not your usual 90-day wonder that we are always promised. They broadened the number of covered workers by eliminating uninsured independent contractors. In Oklahoma we try to make it easier to work without coverage. They tuned up their existing system by cracking down on the fraudulent underreporting of wages. Why is there more talk about that?

In the final analysis, modeling Oklahoma after another state is a fool's gambit, taking an uncalculated risk for an intangible gain. Let's face it. We may never get high marks in some of the categories. For example, duration of disability may be influenced by unreported factors, Oklahoma's consistently high rankings in obesity, heart disease and diabetes. This complicating factor may never change and thus dampens any attempt to reduce lost time. So why should we throw out the baby with the bath water, and fill the pan with another state's bath water?

Instead, we should be committed to continuously improving the existing system. Our mission should be to get workers back to work as expeditiously as possible. One of our goals to accomplish this mission should be to streamline the authorization process for medical treatment. We will measure of our success by steadily climbing up the rankings ladder, not taking one giant step to the top.

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