Labor and Public Employees Committee

JOINT FAVORABLE REPORT

Bill No.:

HB-5075

Title:

AN ACT CONCERNING DISABILITY INSURANCE COVERAGE FOR UNIFORMED MEMBERS OF FIRE DEPARTMENTS WHO ARE OTHERWISE INELIGIBLE FOR WORKERS' COMPENSATION BENEFITS FOR CERTAIN TYPES OF CANCER.

Vote Date:

2/23/2016

Vote Action:

Joint Favorable Substitute

PH Date:

2/16/2016

File No.:

3

SPONSORS OF BILL:

Labor and Public Employees Committee

Rep. Brenda L. Kupchick, 132nd Dist.

Rep. Janice R. Giegler, 138th Dist.

Rep. Bill Simanski, 62nd Dist.

Rep. Noreen S. Kokoruda, 101st Dist.

REASONS FOR BILL:

A study to evaluate the current Worker's Compensation System in the state

***Substitute Language (LCO# 2075):

1. Requires the state to establish a firefighters' cancer benefit program no later than January 1, 2017;

2. Through the program, the state shall procure a disability insurance policy to provide benefits for firefighters with certain types of cancer;

3. Benefits will be provided to certain uniformed members of paid municipal or volunteer fire departments who suffer from certain conditions of cancer;

4. Requires specific eligibility conditions in order to receive benefits from the program;

5. Any uniformed member of paid municipal or volunteer fire department applying for benefits shall be required to submit to annual physical examinations as a condition of receiving such benefits.

6. Requires fire chiefs or local fire marshals to submit quarterly reports to the state fire marshal to include specific information relating to each fire, explosion, or other fire emergency in their jurisdiction.

RESPONSE FROM ADMINISTRATION/AGENCY:

State of Connecticut, Department of Criminal Justice: Suggests substitute language the Office of the Chief's State's Attorney, and more specifically the Workers' Compensation Fraud Control Unit, be added to the state agencies that are required to be notified of the imposition of fines in the event an employer does not comply with the requirements of Section 31-288. This section of the statutes provide for penalties for noncompliance by employers with insurance requirements or defrauding a Workers' Compensation insurance carrier. We respectfully suggest the following language:

Subsection (3) of section 31-288 of the general statutes is hereby repealed and the following is substituted in lieu thereof (Effective October 1, 2016):

(e) The chairman of the Workers' Compensation Commission shall notify the State Treasurer, [and] the Attorney General, and the worker's compensation fraud unit in the office of the chief state' attorney of the imposition of any penalty, the date it was imposed, and the amount whether there has been an appeal of said penalty.

NATURE AND SOURCES OF SUPPORT:

Bill Ethier, CAE, Chief Executive Officer, Home Builders & Remodelers Association of Connecticut, Inc: Supports the study bill, and strongly urges that the bill direct the agency to analyze the reason that the Connecticut's workers' compensation rates are so much higher than Massachusetts and Rhode Island. Our members in Connecticut report that Workers' Compensation Insurance is a huge component of their labor costs and a serious concern for continuing operations in our state.

Chris Syrek, President of Associated Builders & Contractors: It is essential that the workers' compensation system be evaluated and modernized. Here are some specific immediate concerns: Lack of specificity in defining compensability; having higher worker's compensation costs than our neighboring states; lags in the system between medical appointments, such as filing medical reports that delay employee's return to work and increase cost to employers.

David Lowell, Executive Vice President and CEO, Hunter's Ambulance Service, Inc:

There are situations that exist where the workers' compensation system is not functioning as intended and has a significant and debilitating impact on businesses and their employees across the state. Some of the cost-related problems include: employers insured under a high retention policy are required to post very large operating capital as collateral against existing and potential claims; compensability needs to be defined with greater specificity; permanency ratings are inconsistently applied which do not treat the employee or employer fairly; fee schedules for medical visits and procedures for injuries related to workers' compensation claims are often higher than the same procedures that would be claimed under an insured's private insurance.

Susan Matlos, Senior Vice President, People's United Bank: The current workers' compensation system provides permanent injury benefits that include both the non-work related and the work-related injury which is unfair and inequitable. This practice increases costs for employers.

Susan Tallo, Claims Manager, DATTCO, Inc: The costs associated with workers' compensation due to the current fee schedules, inconsistent rating charts and the broad definition of compensability are a debilitating financial strain for employers. In addition, the high claim cost affects a business's experience modification factor. This factor is designated by the National Council on Compensation Insurance (NCCI), and derives from claims costs. A high experience modification factor can prohibit a contractor from bidding on new business which prohibits any growth potential.

NATURE AND SOURCES OF OPPOSITION:

Dallas Dodge, Counsel of the Insurance Association of Connecticu (IAC): A study and evaluation of the effectiveness of the current workers' compensation system is not problematic. We do, however, have concerns that fundamental and systematic changes to Connecticut's existing workers' compensation system could undermine the system as a whole. In the 1990's, the IAC, along with the general business community and a strong coalition of legislators within the Connecticut General Assembly worked together to create reforms to Connecticut's workers' compensation system. The reforms helped to create a system that is one of the most generous and fair workers' compensation system in the entire country.

Louise DiCocco, Assistant Legal Counsel, Connecticut Business and Industry (CBIA): We do not have any concern with a study being conducted. However, we do have concerns with any changes that would fundamentally alter the current system. We would be willing to provide input on specific recommendations that could potentially make the workers' compensation system more effective and efficient while preserving the current system.

Reported by: Virginia L. Monteiro

Date: March 21, 2016