L&I proposes workers’ comp rate decrease for 3rd straight year

TUMWATER (Sept. 19, 2019) — The price of workers’ compensation insurance in Washington state would drop for the third year in a row under a proposal by the Washington Department of Labor & Industries (L&I). The agency announced Wednesday a proposed 0.8 percent decrease in the average premium employers would pay for the coverage in 2020.

“Workplace injury rates in Washington are declining, and we’ve had great success in recent years helping injured workers heal and return to work,” said L&I Director Joel Sacks. “That’s good for everyone and is helping us keep the price of workers’ compensation insurance down.”

In 2018, the average workers’ compensation premium rate dropped by 2.5 percent. L&I lowered the 2019 rate by another five percent, the largest decline in more than 10 years.

“This reduction in the average workers’ compensation rate is possible thanks to years of thoughtful planning by Labor & Industries and the Workers’ Compensation Advisory Committee,” said Larry Brown, President of the Washington State Labor Council, AFL-CIO. “By reforming accounting practices to hedge against too-rosy long-term financial assumptions, ensuring that we have built up a healthy contingency reserve, and by reducing the rate of long-term disability for injured workers through early intervention initiatives, the cost of Washington’s workers’ compensation system has decreased without cutting benefits.”

“This is another example of the public sector doing good work on behalf of Washington’s working families, while also ensuring reasonable costs,” he added.

Employers would pay less under 2020 proposal

The proposed decrease would mean Washington employers, as a group, pay a total of $21 million less in premiums.

The price drop would result in employers paying an average of about $15 less a year per employee for workers’ compensation coverage. Employees would see a very small increase in the amount they pay because of a rise in costs related to the supplemental pension fund, due to an increase in the average wage in Washington. The supplemental pension fund supports cost-of-living adjustments for long-term time-loss and pension benefits.

The public will have an opportunity to provide input about the rate proposal before a final decision is made in late November.

Making workplaces safer and helping injured employees heal and return to work

Preventing work-related injuries, along with L&I initiatives to improve outcomes for injured workers and reduce costs, has made the system healthier — contributing to the proposed decrease.

“While workers’ compensation insurance provides a safety net for workers and employers, the best thing we can do is work together to prevent workplace injuries and deaths and make sure employees come home safe and healthy,” Sacks said.

One of the ways L&I is helping employees and lowering claim costs is by ensuring injured workers receive return-to-work or vocational assistance much more quickly than in the past. This system-wide culture shift to support the vocational recovery of injured workers has made a real difference by helping prevent work disability and unnecessary time off work. The result has been a significant increase over the last five years in workers returning to work after their initial vocational services referral.

Since this change, for every 1,000 referrals, the number of workers getting back to work has more than doubled. We anticipate even better results as we implement newly tested best practices in 2020.

Public hearings planned

Employers and workers pay into the workers’ compensation system to help cover the cost of providing wage and disability benefits for injured workers, as well as medical treatment of injuries and illnesses.

Everyone will have an opportunity to comment on the 2020 proposed rates at three public hearings:

• Tukwila, Oct. 29, 10 a.m., Dept. of Labor & Industries Tukwila Office
• Spokane Valley, Oct. 30, 9 a.m., Spokane CenterPlace
• Tumwater, Nov. 1, 10 a.m., Tumwater Labor & Industries Office

People can also comment in writing to Jo Anne Attwood, administrative regulations analyst, P.O. Box 41448, Olympia, WA 98504-4148; or email joanne.attwood@Lni.wa.gov. All comments must be received by 5 p.m. Nov. 5, 2019.

More information about the proposal is available here. Final rates will be adopted by early December and go into effect Jan. 1, 2020