Lawmakers ponder WSI lawsWorkforce Safety and Insurance needs to have stable, realistic premium rates, a fund with a healthy surplus and to be protected from undue political influence, members of the Legislature’s interim Industry, Business and Labor Committee decided Wednesday.
By: By Janell Cole, N.D. Capitol Bureau, The Jamestown Sun
BISMARCK — Workforce Safety and Insurance needs to have stable, realistic premium rates, a fund with a healthy surplus and to be protected from undue political influence, members of the Legislature’s interim Industry, Business and Labor Committee decided Wednesday.
It is recommending several bills for the 2009 Legislature that committee Chairman Rep. Rick Berg, R-Fargo, said will protect the state workers’ compensation fund from mismanagement that caused problems 15 to 20 years ago, when it ran a deficit that could only be corrected by steep premium increases.
Berg asked the bills to be prepared largely because of the probable passage of Measure 4, which would return WSI to the governor’s cabinet and make other changes.
He said the fund went in the hole in the 1980s and early 1990s because governors kept premiums artificially low for political reasons. When rates had to be raised eventually, the increases were so steep it drove some employers out of business, he said.
“To ensure solvency, we need to ensure reasonable rates be set,” Berg said.
One bill the committee forwarded to the session mandates that rates be set according to an outside actuary’s computation, with a variance of no more than 5 percentage points below or above the actuary’s recommendation.
“It holds the board and governor accountable,” Berg said.
Another will require the agency’s records be examined every two years for any trends showing that political office holders or appointees are using their influence to affect the outcome of individual cases, or the classification of employers’ premium rates or other factors.
“That was the system pre-1995,” Berg said.
In 1997, the Legislature put an independent board in charge of the agency, and the governor was left with little say except to rubber stamp board nominees.
Rep. Bill Amerman, D-Forman, was worried about whether he would be allowed to support constituents if such a bill passed.
He said constituents frequently asked him to sit with them in their WSI case hearings.
Berg said he didn’t want to discourage lawmakers from helping their constituents; he wanted to prevent situations in which isolated WSI cases are handled contrary to normal or correct processes because of undue influence.
The law he contemplates “will prevent someone from going down that road, and if they do go down that road, it becomes public.”
Rob Forward, an attorney at WSI, testified Wednesday against one proposed version of the bill, which would have told claims analysts and others handling cases that they should report any such cases of undue influences — even it is coming from their bosses in WSI management — so the case is investigated.
He said WSI workers were worried about being asked to do that.
Eventually, Berg’s idea was inserted into a bill that makes slight changes in an existing law that mandating an outside performance evaluation at WSI every two years. The outside consultants would examine cases looking for such trends.
Also on Wednesday, the committee voted to forward a bill that raises the amount of money WSI can keep in its surplus to 150 percent of what it needs to pay outstanding claims. But it allows the agency to exempt from that figure any money it has committed to safety programs or other special initiatives.
And, finally, the committee on Wednesday voted to forward a bill that will asked the Legislature to study making WSI into a mutual insurance company instead of a state agency.
Cole works for Forum Communications Co., which owns The Jamestown Sun