In the early ‘90s, times were very different than they are today. Maine’s economy was in a tailspin, state revenues were declining and legislators were considering enactment of a $3.2 billion budget.
Most notably during that time, workers’ compensation insurance was increasingly difficult for employers to come by as insurance providers were pulling out of the state market, leaving very few options for coverage. During this time, Maine had the most expensive workers’ compensation coverage in the country.
As an employer, I remember this time all too well. Times were turbulent during the early ‘90s for employers in Maine, and this turbulence was felt throughout the whole economy, which is why conservatives insisted on comprehensive reforms to fix the broken system.
Fast forward to today and our workers’ compensation system has been stable for nearly thirty years, there are more jobs, state revenue is booming, and we are considering an $8 billion budget.
Times are good, yet some have forgotten the path we took to get here and are proposing to reverse many of the important workers’ compensation reforms that we fought so hard to enact in 1991.
The Labor and Housing Committee has combined these bills into one bill, but in my opinion, we should vote them all down. The reason is simple – the current system is not broken. It does an adequate job at striking a healthy balance between employees and employers while bringing much-needed predictability and price stability to the system.
By rocking this boat, we will hurt job growth, discourage investment in our state, hurt small businesses that provide so many jobs in our communities and it will discourage new businesses from coming here to open.
According to sources within the workers’ compensation industry, the current slate of bills could increase the cost of this critical coverage to Maine employers significantly, and there is nothing in the package currently being worked by the committee that would address fraud within the system or control costs.
In addition to increasing the cost of hiring Maine workers, much of the increases proposed would go to legal fees paid to attorneys, not to the injured employees where the benefits belong.
Other costly reforms currently under consideration would increase the maximum rate paid out by 20 percent, lift the cap on benefits, essentially turning the program into a lifetime benefit, and make it easier to claim stress as a disability – all very expensive to a system that wasn’t broken.
Many of the measures sought today open the door for widespread abuse and discourage the return to the workforce. Putting cost aside, Maine currently has more job openings than employees. Certain sectors, such as health care, are starving for qualified Mainers to employ.
So I would argue that our efforts should go towards expanding access to training programs, developing our skilled workforce and connecting businesses with the hardworking staff they require so we can continue to move our economy in the right direction. We can’t afford to return to the pre-1991 workers’ compensation system that nearly broke our state economy.
