Florida has had a couple of state Supreme Court rulings finalized which could impact claims and attorney fees, and now the state’s work comp rates. The Florida Office of Insurance Regulation, after rejecting a proposed rate increase of 19.6 percent from the National Council on Compensation Insurance (NCCI), tentatively accepted an increase of 14.5 percent. The increase is slated to take effect December 1^st of this year.

Now NCCI has until October 4^th to review this new rate and approve it. If the 14.5 percent increase is approved, here is the breakdown of what went into the increase.

One of the highly anticipated court case rulings was Castellanos v. Next Door Company, and the court found that the mandatory attorney fee schedule in Florida was unconstitutional. That ruling generated a 10.1 percent rate increase. Another big case, Westphal v. City of St. Petersburg, found that the limit on temporary total disability benefits to 104 weeks was unconstitutional. They reinstated a 260 week limitation, which had been Florida’s limit until 1994 when it was lowered. That ruling had a 2.2 percent rate increase impact. Updates to Florida’s Work Comp Health Care Provider Reimbursement Manual increased rates by 1.8 percent.

The ruling on the Castellanos case could potentially increase workers’ comp litigation cases because injured workers and lawyers can work out a fee rather than using the mandatory fee schedule. That additional litigation may extend the time that claims are open or may extend the time until workers return to work. A longer limit on temporary total disability could also mean that workers are not returning to the job as quickly and their claims are open longer. OIR said that they may need to increase workers’ comp rates even more because of those trickle down effects of the rulings.

Although groups like the Florida Chamber of Commerce and the National Federation of Independent Businesses support injured workers and recognize that some changes were needed, they are worried about the rate increases. Some think that trial lawyers will simply raise their fees if there is no mandatory fee schedule, and small business owners are worried about such a significant rate increase.

From the Insurance Journal.