NCCI Presumptions Tracker

Below are the latest updates from NCCI regarding state presumptions:

Illinois: (Past by Both Chambers on 5.22.20) HB 2455 In Part, Provides That There is a Rebuttable Presumption That an Employee’s Contraction of COVID-19 Arises Out of and in the Course of the Employee’s First Responder or Frontline Worker Employment and That the Injury or Occupational Disease Shall Be Rebuttably Presumed to Be Causally Connected to the Hazards or Exposures of the Employee’s First Responder or Frontline Worker Employment

Massachusetts: (In Joint Committee) HB 4739 Creates a Presumption of Relatedness for Essential Workers Suffering From COVID-19

Michigan: (In Senate Committee) SB 928 Relates to Infectious Disease Presumption for Essential Employees During a Declared Emergency

Ohio: (Introduced the Below)

HB 667 Makes COVID-19 Contracted by a Corrections Officer an Occupational Disease   Under the Workers Compensation Law

HB 668 Makes Coronavirus Contracted by a Peace Officer, Firefighter, or     Emergency Medical Worker an Occupational Disease Under the Workers Compensation Law

As a reminder, NCCI provides regular updates regarding presumption activity.  To access the tracker, click here.

Stay Safe,

Team Libertate

 

Workers’ Compensation Super Bowl

The National Council of Compensation Insurnce (“NCCI”) hosts their Annual Issues Symposium this afternoon on a shortened and virtual basis.  There is no other conference that influences what happens with workers’ compensation reserving and pricing then this one.

All major carriers and their respective mathematical prophets will be on the line to measure profitability and the components thereof for the last year and historic.  Even more importantly this year, the prediction of go-forward profitability and pricing guidance/trend.

Click to access II_AIS2020-Agenda.pdf

Mr. Donnell starts off at 1:00, State of the Line at 1:15 and Bob Hartwig does a COVID presentation 2-3.  Very much condensed than usual and for the first time that I know of… its free!

We will be summarizing our interpretations of these presentations later in the day but please check out if you have the time.  Hartwig, especially, is a tremendous speaker –

The links below to join…

Plan to join us for NCCI’s Annual Issues Symposium—AIS Virtual<https://www.ncci.com/Articles/Pages/AIS_LiveStream_UserCapture.aspx?aisinvitelinkclick=yes>, May 12, 2020, 1:00 p.m. ET.

AIS Virtual is the premier workers compensation event offering actionable intelligence around the industry’s most relevant issues.

These helpful tips will get you ready:

 

  • For optimal viewing, use Chrome or Firefox and log in early to test your system’s livestreaming capability.

 

  • Log in will be available 15 minutes prior to our start time, and you’ll be able to enjoy our AIS Virtual preshow content as we count down to our 1:00 p.m. ET kickoff.

 

Following the main program, view our interactive Meet the Experts session, and access additional insights via our AIS Virtual Highlights Report on ncci.com.

For more information, and the full AIS Virtual agenda<https://www.ncci.com/Articles/Documents/II_AIS2020-Agenda.pdf>, visit ncci.com<https://www.ncci.com/Articles/Pages/II_AIS2020-Registration.aspx>.

The NCCI Speaks to the Impact of COVID19 on Workers’ Compensation

Following suit with the research brief from WCIRB. Click here to access.

…done last week by the Workers’ Compensation Insurance Rating Bureau of California (“WCIRB”) on the impact of COVID19 on the California Workers’ Compensation system, the National Council of Compensation Insurance (“NCCI”) came out yesterday with the same for the 38 States that it tracks for rule and rate-making purposes. Note the numbers below do not include half the country’s volume of workers’ compensation premiums when it is considered States like California (25% on its own), New York and Ohio are not included in the below data.

Key findings of the NCCI on frequency rates:

  • % of ee’s that will contract COVID 19 on the job – <10% – 81%
    • it should be noted that the issue of “Presumption of Coverage” related to different types of occupations is the driver of the huge range in frequency – all States are presuming “First Responders” (1,176,110 workers), others to include Healthcare Workers and First Responders (9,666,420 workers) and still others such as Illinois that presumes any worker that is client facing has occupational exposure to the disease (86,351,950 total workers in the 38 States considered)
  • Infection rate is 5-50% regardless of class of worker above
  • Range of Impact of CoVid losses on overall expected losses by category of worker:
    • First Responders – PreCoVid expected losses of $1.1B with potential impact of $.1B – $1.9B… 10%-170% range
    • First Responders and Healthcare Workers – Pre CoVid losses of $3B  with potential impact of $1B – $16.2B…. 33% – 550% range
    • All Workers – PreCovid losses of $32.1B with potential impact of $2.78B – $81.5B… 8 – 254% range
    • Hospitalization rate after infection range is 1 – 31%
    • Critical care rate of 5 – 27%
    • Duration of care for mild symptoms of 2 weeks and 3 – 6 for moderate or critical cases
    • Cost per claim type:
      • Mild $1,000
      • Moderate-Severe $25,500
      • Severe $59,000
    • Impact by infection and compensability rates
      • 1% occupationally impacted, cost of loss goes up 8%
      • 5% = 42%
      • 10% = 85% – which at present is NCCI’s selection
    • Fatality rate for those infected with the virus is .5% across all classes of employees – Average impact $146,980 in death benefits (does not include medical)

My summation of what the NCCI and WCIRB are projecting is as followed:

  • The huge range in expected costs is going to be understood on a State by State basis with the issue of presumption of contraction based on occupational duties being the biggest driver
  • As each State has unique payouts for disability and death, the prediction of cost and risk load for pricing needs to be State by State
  • The healthcare segment is providing the most unpredictability – add a risk load, park the business elsewhere or stay out of the segment for now – too unpredictable
  • PEO’s can be a very important partner to insurance carriers by allowing them to understand performance data fastest due to their management of payroll
  • The smartest people I know do not know what to predict but this is a start – we probably will not have enough real data to narrow this range of expectations for months

Stay safe and we will get through this – but with our eyes open.

Regulators and Lawmakers Introducing Workers’ Comp to COVID-19

By Jim Sams, April 20, 2020

Sympathetic state lawmakers and regulators in states both red and blue promise to make COVID-19 a major cost driver for workers’ compensation insurers.

The governors of Kentucky, Arkansas, North Dakota and Florida and state regulators in Illinois, Washington, Michigan and Missouri have issued executive orders or amended rules to expand eligibility for workers’ compensation.

Most of those decrees ease the path for benefits only for healthcare workers and first responders, but an emergency order by the Illinois Workers’ Compensation Commission creates a presumption that work is the cause of COVID-19 if contracted by any “frontline worker” identified in Gov. J.B. Pritzker’s March 20 stay-at-home order. That includes workers at grocery stores, laundries, banks and hardware stores, among other businesses.

Kentucky Gov. Beshear issued a similarly broad executive order that created a COVID-19 presumption for workers in grocery stores, child-care centers, domestic violence shelters and rape crisis centers, in addition to first responders and healthcare workers.

In the meantime state legislators are also pushing to expand benefits for COVID-19. Earlier this month, Alaska Gov. Mike Dunleavy (R), Wisconsin Gov. Tony Evers (D) and Minnesota Gov. Tim Walz (D) signed into law bills that create a COVID-19 presumptions for first responders and some healthcare workers.

Bills to create presumptions for COVID-19 have been introduced in the New York, New Jersey, Pennsylvania, Ohio and Utah state legislatures.

Steamroller

Philadelphia defense attorney Cliff Goldstein said he saw the avalanche of presumption bills coming as soon as heard the first reports of the disease spreading into the United States.

“I don’t think there’s any way to stop that steamroller,” he said.

Data from the California Division of Workers’ Compensation bears him out. As of Thursday, 1,527 claims coded for COVID-19 on claims notices had been filed, according to agency spokeswoman Erika Monterroza.

Goldstein is not the only defense attorney predicting a flood of COVID claims.

“There will likely be many workman compensation claims because of the ease of filing, there is no requirement to prove negligence, and for many people their greatest contact with others, and hence the greatest chance of contracting the virus, is at work,” David Boies, managing partner of Boies Schiller Flexner LLP in New York, told Bloomberg News.

Goldstein said presumption legislation promises to be a boon for claimants’ attorneys, who will take a percentage of any permanent disability benefits awarded.

“You are just dangling meat in front of hungry lions,” he said.

Goldstein said his office — Chartwell Law in Valley Forge — has already received a handful of claims, some of them death claims. He said employers should resist any kind-hearted urge to quickly approve such claims based on the employee’s job category. Instead, each claim must be individually investigated, he said.

COVID-19 claims that require admission to an intensive care unit will likely run into the six figures for medical costs alone, he said. What’s more, employers will be taking full responsibility for whatever complications arise from a coronavirus infection far into the future.

Goldstein said Congress passed a pair of relief bills in March that should make it easier for employers to delay acceptance of a claim. The legislation requires employers with fewer than 500 employees to grant up to 80 hours of sick leave to workers sickened by the new coronavirus, which will be reimbursed with tax credits. Gov. Gavin Newsom issued an executive order Thursday that requires the same benefit from employers with more than 500 workers.

For workers who lose their jobs because of coronavirus, the federal emergency law also allows up to 16 weeks of unemployment insurance benefits at rates ranging from $875 to $1,500 per week, depending on the state, Goldstein said.

Vulnerable Occupations

Claimants’ attorney Julius Young in Oakland, Calif. said those benefits won’t make workers whole. Usually workers lose their health insurance if they lose their job, which makes workers’ comp a vital benefit for employees who were made sick because of their exposure to the public while at work. Also, some workers may be permanently disabled by COVID-19.

He said presumption bills make sense for workers who can’t avoid constant contact with the public.

“A lot of these people in vulnerable occupations shouldn’t have to go through this roulette-like maze wondering whether they are going to be covered,” Young said.

Young said the federal benefits will help in the short-term. He said state regulators should start thinking about whether and how any federal benefits paid can be offset from workers’ compensation awards.

Medical research indicates that there is a real possibility of permanent disability from COVID-19.

According to Science Magazine, the lack of oxygen and widespread inflammation caused by COVID-19 can damage kidneys, liver, heart, brain and other organs. Studies show that severe pneumonia caused by other diseases sometimes lead to scarring that causes long-term breathing problems. Pneumonia also increases the risk of future illnesses, including heart attack, stroke and kidney disease.

In one study of 138 patients hospitalized in Wuhan, China due to pneumonia from COVID-19, 20 percent suffered acute respiratory distress syndrome.

A separate study published by the New England Journal of Medicine in 2011 Regulators and Lawmakers Introducing Workers’ Comp to COVID-19found that of 109 survivors of ARDS, 51% suffered physician-diagnosed depression, anxiety or both. Perhaps more relevant to workers’ comp, that study found that just 77 percent of the 83 patients who survived throughout the study period had returned to work five years after being treated. The study found that only 39% of patients were able to walk the distance expected for their age group in six minutes five years later, suggesting a high degree of physical impairment.

As of yet, none of the major workers’ compensation rating organizations has released any projections on the potential impact of COVID-19 on workers’ comp loss costs.

The National Council of Compensation hopes to release next week an analysis of potential claim costs under a variety of scenarios, said Executive Director Jeff Eddinger. For example, one scenario project costs if a large percentage of workers who contract COVID-19 file claims and 100 percent are found to be compensable. He said the analysis will make projections for a variety of infection and claim-acceptance rates.

Eddinger said NCCI does not yet have any data on how many claims have been filed. He said insurers don’t report their losses until six months after the policy period expires. But he said there is some data available. For example, the Centers for Disease Control and Prevention reported that between 10 percent to 20 percent of COVID-19 cases were healthcare workers.

The California Workers’ Compensation is working on similar projections, said President Alex Swedlow.

 

Want to learn more about how COVID-19 affects your company? Give us a call at 305-495-5173, or email us at sreynolds@libertateins.com.

WCIRB Releases Cost Evaluation of Conclusive COVID-19 Presumption

See below from the WCIRB regarding the projected cost of COVID-19 claims to be filed by ‘Essential Critical Infrastructure Workers’….At the low end, if only 4.8% of California ECI workers file claims related to COVID-19, the cost to the system will be an astounding $2.2B!

—————-

WCIRB Releases Cost Evaluation of Conclusive COVID-19 Presumption

Oakland CA, April 20, 2020 – The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) released its Cost Evaluation of Potential Conclusive COVID-19 Presumption in California Workers’ Compensation. The evaluation was completed in response to an April 8, 2020 request from the California State Assembly Insurance Committee to assess the impact of a conclusive presumption that COVID-19 claims arising from certain front line workers are presumed to be work-related. Specifically, the WCIRB was requested to provide the cost impact of a conclusive COVID-19 presumption for health care workers, firefighters, EMS and rescue employees, front line law enforcement officers and other essential critical infrastructure (ECI) employees.

The WCIRB estimates that the annual cost of COVID-19 claims on ECI workers under a conclusive presumption ranges from $2.2 billion to $33.6 billion with an approximate mid-range estimate of $11.2 billion, or 61 percent of the annual estimated cost of the total workers’ compensation system prior to the impact of the pandemic. The WCIRB noted that in developing this estimate it did not include a provision for non-ECI workers who may file a compensable workers’ compensation COVID-19 claim, nor did it adjust for the COVID-19 claims of ECI workers that may be compensable in the absence of a conclusive presumption.

————

This and other important workers’ compensation topics will be discussed tomorrow during part 2 of NAPEO’s Coronavirus Updates webinar where our very own, Paul Hughes, will share his thoughts.  Click here for registration details.

 

W. R. Berkley Corporation Announces Senior Executive Appointments

It’s refreshing to see some positive non-COVID news from the industry!

Congrats to our PEO carrier partner, Key Risk (owned by W.R. Berkley) and its new president, Scott A. Holbrook.  The former President, Robert W. Standen, was promoted to Executive Vice President.

Additional details below.

W. R. Berkley Corporation Announces Senior Executive Appointments

4/7/20

Robert W. Standen Named Executive Vice President

Scott A. Holbrook Appointed President of Key Risk Insurance

GREENWICH, Conn.–(BUSINESS WIRE)– W. R. Berkley Corporation (NYSE: WRB) today announced the appointment of Robert W. Standen as executive vice president with oversight responsibility for certain of the Company’s operating units. Scott A. Holbrook will succeed Mr. Standen as president of Key Risk Insurance, a Berkley Company. The appointments are effective immediately.

Mr. Standen joined Key Risk Insurance in 2003 as executive vice president and chief claims officer and assumed the role of president in 2007. He has been instrumental in advancing the operating unit’s leadership position and expansion in the mono-line workers’ compensation segment. His professional designations include Associate in Risk Management (ARM), Associate in Claims (AIC) and Associate in Loss Control Management (ALCM) from the Insurance Institute of America. Mr. Standen earned his Masters of Business Administration degree from St. Joseph’s University and graduated with a Bachelor of Science degree from LaSalle University.

Mr. Holbrook has 25 years of experience in the commercial lines property casualty insurance business. He most recently served as the senior vice president for the Mid-Atlantic division of a leading global insurer. Mr. Holbrook holds a Bachelor of Science degree in finance and marketing from the Virginia Commonwealth University School of Business and is a Chartered Property Casualty Underwriter (CPCU).

Commenting on the appointments, W. Robert Berkley, Jr., president and chief executive officer of W. R. Berkley Corporation, said, “We are pleased to have Rob assume this new position. His deep knowledge of the property casualty insurance business and hands-on experience in managing one of our operating units will be invaluable to our corporate oversight activities. We welcome Scott to the team and are confident that his extensive underwriting background, operating experience and independent agent and broker relationships will enable him to lead the Key Risk team in building upon its success.”

Key Risk Insurance delivers innovative and responsive workers’ compensation solutions that provide clients the freedom to do what they do best. With over 30 years of expertise and 100% focus on workers’ compensation, Key Risk Insurance works with employers to enrich each client’s risk management strategies by creating and executing comprehensive solutions proven to protect people, support business and exceed expectations. For further information about Key Risk please visit www.KeyRisk.com.

Founded in 1967, W. R. Berkley Corporation is an insurance holding company that is among the largest commercial lines writers in the United States and operates worldwide in two segments of the property casualty insurance business: Insurance and Reinsurance & Monoline Excess. For further information about W. R. Berkley Corporation, please visit www.berkley.com.

Products and services are provided by W. R. Berkley Corporation’s subsidiaries and “operating units”. Operating units are not typically legal entities, but for marketing purposes may sometimes be referred to individually as “a Berkley company” or collectively as “Berkley companies”.

 DOWNLOAD THIS PRESS RELEASE PDF FORMAT

Karen A. Horvath
Vice President – External
Financial Communications
203-629-3000

Source: W. R. Berkley Corporation

 

Workers’ Comp Premiums Could Skyrocket With COVID-19 Claims

Source: Bloomberg Environment

  • Health-care workers likely eligible for workers’ comp
  • Grocery, delivery workers will argue for eligibility

Health-care workers and emergency responders will benefit from rules eased in some states around workers’ compensation that will allow them to collect benefits if they can prove they caught Covid-19 on the job. Some say essential workers like grocery store employees and delivery workers also should qualify.

But employers need to be aware of the changing rules, and be prepared for the likely end result—skyrocketing premiums.

State workers’ compensation boards around the country are amending rules for benefits payouts to include health-care workers exposed to the virus and then quarantined.

Attorneys are keeping a close eye on the questions, such as who should be eligible to receive benefits, how does a worker prove they caught Covid-19 on the job, and how will an influx of successful claims affect businesses’ premiums to insurance carriers.

“If everybody who gets sick on the job is able to file a compensation claim and everyone is successful, it may bankrupt a company,” said Michael Duff, a workers’ compensation professor at the University of Wyoming.

Quarantined Workers

Workers’ compensation is a state-mandated insurance program that provides pay to workers who are injured on the job—in return, the worker agrees not to sue their employer. Like unemployment insurance, workers’ compensation rules vary by state.

In early March, Washington’s Department of Labor & Industries announced that it “will provide benefits to these workers during the time they’re quarantined after being exposed to COVID-19 on the job.”

And on March 13, Kentucky Gov. Andy Beshear’s office announced that Kentucky Employers’ Mutual Insurance will “expand coverage benefits to include the quarantine period for first responders and medical personnel,” a news release stated.

Still, many states haven’t changed their policies, and experts say proving causation can be tough for workers.

Proving Exposure at Work

Earlier this month, the Occupational Safety and Health Administration declared that coronavirus was a recordable injury—meaning an employer would have to notify the federal safety agency when a worker caught the disease at work—and issued guidance to that effect.

Safety attorneys said the guidance left confusion about how to prove whether a worker actually contracted the virus on the job, said Joshua Henderson, partner at Norton Rose Fulbright US LLP in California.

“At the moment, the question of causation is where there is a lot of uncertainty,” Henderson said. “Whether it was caused by a condition at work.”

Some lawyers and activists think grocery store workers and delivery drivers are eligible for workers’ comp benefits, since their employers deem them essential workers and they could be at higher risk of COVID-19 exposure based on their persistent contact with the public as the pandemic rages across the country.

Duff argues that there are scenarios where a worker could establish causation is by citing one’s essential employee status.

“If you’re required to come in and deemed essential employees, because you are by definition required to come into work during a pandemic, then I think the argument would be, ‘My risk of contracting this disease is by definition higher than the general public.’ What you’re basically saying is, ‘My workplace increases the risk of me contracting the disease’,” Duff said.

He said he believes many workers will qualify for claims, causing employer premiums to rise, and the pandemic exposes fissures in workers’ compensation rules and labor law as a whole.

“If I was in management, I’d figure out a strategy that is fair but won’t hasten my demise or subject me to extraordinary financial pressure,” Duff said. “I would be thinking about how I would responsibly contest claims in a way that doesn’t make me look like an ogre.”

Jeff Eddinger, regulatory business management specialist at the National Council on Compensation Insurance, told Bloomberg Law that no national data is available that can outline the impact of COVID-19 on premiums. Assuming there’s an influx of workers’ compensation claims from the health-care sector, “that would certainly cause some upward pressure on claim costs in the system, but then I would say on the other side of that, during this time where people are telecommuting and some industries shut down, that creates downward pressure because people aren’t working. Those two things could offset each other.”

Duff said employers should develop practices and policies that can reasonably contest claims, but “don’t unreasonably respond to workers because my customers aren’t going to feel good about it.”

Grocery, Delivery, and Essential Workers

Edward W. Guldi, a New York plaintiff’s workers’ comp attorney at The Perecman Firm, P.L.L.C., also said it’s not likely grocery or delivery drivers would be successful in worker’s comp claims.

“Nurses are going to get their claims, the hospital workers, too,” Guldi said. “The people who aren’t are grocery store workers, waiters, office workers and delivery drivers and basically everybody else who doesn’t qualify.”

He compared their position to the Sept. 11 firefighters and first responders in New York who initially were denied workers’ compensation. Later, the state legislature passed Article 8-A, which addressed the complications caused by the two-year statutory filing deadline, allowing those injured or sickened in rescue, recovery, and cleanup efforts access to compensation.

The New York Committee for Occupational Safety and Health—an organization of unions, worker centers, and activists—already has begun lobbying for sick workers to receive workers’ compensation in New York. A representative from the organization wasn’t available for comment.

John Ruser, president and CEO of the independent, nonprofit Workers Compensation Research Institute, said one way to ensure nonhealth-care workers are covered by workers’ compensation is through state legislation.

“In some cases, legislators passed a law that said certain conditions are presumed to be work-related, therefore all claims that come from a class of workers related to COVID-19 would be compensable. Legislators can pass that,” he said.

Guldi said maybe the New York State Assembly “will do the right thing for those who have this illness. I know when George Pataki was governor, it took unions and police unions and 9/11 widows and lobbying to make that happen.”

To contact the reporter on this story: Fatima Hussein in Washington at fhussein@bloombergenvironment.com

To contact the editors responsible for this story: Cheryl Saenz at csaenz@bloombergtax.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com