It is widely known that New York has one of the most expensive, yet least efficient workers’ compensation systems in the nation. That it fails to provide adequate care for injured workers while simultaneously burdening employers with excessive costs is a commonly known reality. The administration of Governor Andrew Cuomo has been vocal about overhauling this system, and seems poised to act on their stated intent.

While they seem to be targeting some much needed areas for improvement, a letter published last week by the Executive Director of the New York State Workers' Compensation Board gives me concern that a balanced reform may not be at hand. Jeffrey Fenster authored an outline detailing administration reform priorities for workers’ compensation last week. It appeared in The Buffalo News on January 12, 2014. In it Fenster adequately makes the case for needed reform, and notes important areas where the board is working to change and improve. However, one much needed element seems minimized within his stated outline.

Fenster rightly targets the outdated systems and technology the state currently employs. He says that the state is developing a new claims system to replace one more than 20 years old. They are working to implement “e-claims”, and other modern technological improvements. He says of this effort:

No agency can properly regulate a $7 billion, 21st century system on a 20th century platform. Our claims system was designed nearly 20 years ago, before the Internet age. The new claims system we build must improve employee and employer experience by leveraging technology and well-tested, industry-best practices.

He’ll find no argument from me on that. Fenster also states that the board is in the process of “unprecedented public outreach”, saying the board is “gathering ideas from injured workers, businesses, public employers, organized labor, health care providers, insurance carriers, attorneys and other industry professionals through a variety of forums and focus groups.”

So far, so good; yet he was not done. It was the following in his letter that leads me to believe New York reform may be based on a one sided village, and ultimate failure:

Our most concerted outreach is to the injured workers, who are the heart of our system. Our dedicated injured worker focus group, labor groups around the state, injured worker days in our offices and an ongoing injured worker survey with 6,000 responses to date all contribute to this initiative.

While injured worker input is critical to the process, I would point out to Mr. Fenster that workers’ compensation was not created just for them. Specifically, employers were equal partners in the “Great Compromise”, and their interests and input should be heard on an equal basis. They are also the “heart of the system”, indeed; one of the only two categories workers’ compensation was established to serve.

Where are New York’s employer focus groups? Employer days in the board offices? An ongoing survey of employer needs and observations? Where is the concerted outreach to this critical constituency within workers’ comp?

Employers have vital input in everything from claim process to return to work – and they are funding the entire show. Failing to give them equal footing in the process means they may not get equal consideration, and a resultant “short end of the stick” scenario is likely to occur.

Successful reform consists of two essential parts; determining needs, and then developing process to meet those needs. “Needs” are one thing to adequately determine; figuring out the process to meet them is the second part of the equation.

While Fenster indicates that their overall outreach includes employers, they are clearly not the primary focus of identifying industry needs. I would suggest that input from all players in workers’ compensation is important, but contributions from only two groups really matter in determination of needs, employers and their employees. No one else matters for that essential reform function. Yet, if your focus is primarily on one element, you most assuredly will not get the balanced outcome that will work over the long haul.

It is the development of “process” that takes a wider audience, and it is there all of the supporting players should have a part.

Workers’ compensation was not created for organized labor. Workers’ compensation was not created for health care providers. Workers’ compensation was not created for insurance carriers, attorneys and other industry professionals. It was created for employers and injured workers. When your reform attempts look primarily to the needs of one side of the village, you are destined to repeat mistakes of the past. New York could quite possibly be setting itself up for future reformers to reform the reform today's reformers are championing.

 

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