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DOL report suggests more federal oversight of state workers' comp.

A U.S. Department of Labor report said state workers' compensation systems are increasingly failing to provide workers with adequate benefits, and potential policy remedies should include consideration of increased federal oversight of state workers' compensation programs.

Policy considerations should include "whether to increase the federal role in oversight of workers' compensation programs, including the appointment of a new National Commission and the establishment of standards that would trigger increased federal oversight if workers' compensation programs fail to meet those standards," according to the executive summary of the report, the first such report in more than a decade.

"ALA opposes federal interference in state workers' compensation systems, and we believe that the far better approach, as the record clearly demonstrates, is to debate policy differences in the states," American Insurance Association Vice President Bruce Wood said in a statement.

Other policy recommendations are strengthening workers' compensation with injury and illness prevention and developing programs that follow evidence-based standards to help employers, workers and insurers address long-term management of workers' disabilities.

The report said workers are at increased risk of falling into poverty resulting from workplace injuries and the failure of state workers' compensation systems to provide them with adequate benefits. Yet, employers are bearing a smaller portion of overall costs of occupational injuries and illnesses borne by employees.

"Cost is a function of injury rates and average benefits paid, and consistently declining frequency explains in large measure a decline in cost, "Wood countered. "Improved disability management also explains the drop in cases paying permanent partial disability benefits that proponents of this argument cite as a basis for their cost-shifting premise."

The Property Casualty Insurers Association of America defended the state workers' compensation system and said the report's assessment of how workers' compensation works was inaccurate.

Thomas Harman is Washington Bureau manager, BestWeek. He can be reached at

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Title Annotation:Spotlight on Workers' Compensation
Author:Harman, Thomas
Publication:Best's Review
Date:Nov 1, 2016
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