Contact Info: Jack McDermott
Office Announces Approval of Workers’ Compensation Rate Increase
TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty today announced the Office’s intention to approve a 6.1 percent rate increase to become effective January 1, 2013 for workers’ compensation insurance rates in Florida. The decision was based on evidence submitted by the National Council on Compensation Insurance (NCCI) in their rate filing, and during testimony offered by NCCI in the October 4th rate hearing. Although the order finalized today is officially a denial of the rate filing due to technical issues, the Office has expressed its intention to approve the 6.1 percent rate increase once the filing has been resubmitted.
“NCCI has provided sufficient evidence to support a rate increase based on a variety of cost factors experienced in the marketplace,” acknowledged Commissioner McCarty. “Even with this rate increase, Florida’s rates are still 56 percent below the rates prior to the 2003 reforms, and are competitive with other states nationally. However, I look forward to working with Florida’s policymakers during the upcoming legislative session to address cost-drivers in the system.”
Following the 2003 reforms, Florida experienced seven consecutive years of rate declines, although a chart prepared by the Office, illustrates that this trend has changed in recent years; the Office approved a rate increase of 7.8 percent in 2010, an increase of 8.9 percent in 2011, and now a 6.1 percent increase in 2012 (which will take effect in 2013).
NCCI submitted evidence, noted in the order, about the potential savings that can be realized by addressing cost drivers legislatively. NCCI testified that rates could decline 1.1 percent if Florida addressed the physician drug dispensation issue, and another 5.5 percent if Florida brought its costs in line with other states for in-patient hospital, out-patient hospital and ambulatory care center (ACS) reimbursements.
The Office conducted a public rate hearing on this issue on October 4, 2012 in the Senator Jim King Committee Room in the Senate Office Building. To view exhibits and a video recording of the hearing, please visit the Office’s rate hearing page. You may also read the Office Statement about the release of the Oregon study that compares Florida’s rates with other states around the nation.
About the Florida Office of Insurance Regulation
The Florida Office of Insurance Regulation (Office) has primary responsibility for regulation, compliance and enforcement of statutes related to the business of insurance and the monitoring of industry markets. For more information about the Office, please visit www.floir.com or follow us on Twitter @FLOIR_comm.