Workers Comp Was Eliminated – Then What?
What if Workers Comp was eliminated in the Sunshine State or any other state for that matter?
The Florida State Supreme Court will very likely rule on the constitutionality of Workers Comp in the near future.
Let us look at the insurance landscape if all Workers Comp was eliminated in total.
The first thing that would be affected is the current WC claims. What would happen to those injured employees? Would the elimination of WC be retroactive? That would be a fine mess.
The second thing that would probably happen is the carriers would be so heavily affected that some would actually go into receivership very quickly. The state guaranty funds would then have to pick up the tab. That would be a heavy liability for the states.
The third thing that would happen is Work Comp would become a litigious liability situation. Employers would bring lawsuits against their employee or negligence or contributory negligence.
The fourth set of occurrences would involve employees suing their employers when injured as liability cases. This development and third one would clog court systems for years to come.
The employers would not have liability coverage except possibly under the Employers Liability clauses in the Workers Comp policies.
Any type of network discount for medical treatment would be thrown out as fee schedules would be heavily affected overall. Workers Comp providers would have to renegotiate all contracts.
What would each of the states’ Workers Comp departments do as most of their jurisdiction and need for employees would be eliminated very quickly.
Would employers have to cover all employees under ERISA coverages similar to the current Opt-out employers in Oklahoma and Texas?
How would Workers Comp claim staffs respond as most of them are not trained in adjusting straight liability claims?
As a former multi-line adjuster, there is a night-and-day difference between a Workers Comp claim and a liability claim. Most liability claims are much more slowly paid or settled – the nature of the beast.
How about the injured employee and their family? They, unless they had a side disability policy (AFLAC, etc.), would not receive weekly benefit payments.
In my humble opinion, Florida may get what they ask for – but not in a good way. If Workers Comp was eliminated, the state insurance system would likely end up in shambles unless the State Legislature comes to the rescue.
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