Florida's workers' compensation system has seen significant upheaval this year, with two Supreme Court opinions voiding much of the law and creating uncertainty for businesses. That underscores the importance of determining workers' comp rate increases in the open so the public can assess whether they seem fair and justified. Instead, the ratings agency that proposes rates and the state Office of Insurance Regulation, which approves them, did their work in secret. Now a circuit judge in Leon County has found that work should be done in the sunshine, and she's absolutely right.
Business groups harshly criticized both Supreme Court rulings and warned workers' comp rates would spike. Sure enough, the National Council on Compensation Insurance, which represents the industry, proposed a rate hike of 19.6 percent — the largest increase in at least six years. The Office of Insurance Regulation, which must approve any increase, set a public hearing for August. But the real work — the part that matters — already had happened. NCCI held numerous private meetings about rates with staffers at the OIR, including some with then-Insurance Commissioner Kevin McCarty, with no notice to the public and no minutes kept. About a month after the public hearing, the OIR rejected the requested rate increase but said it still would approve a rate increase of 14.5 percent.
The whole process should be in the open. State law says any meeting of a rating organization "committee" discussing insurance rates must be open to the public. NCCI lamely claimed that because it had not assigned the work to a formal committee, but essentially left it all to one actuary, it was not required to open its meetings. Leon Circuit Judge Karen Gievers did not buy it.
"Far from being the meetings in the Sunshine required by law, the meetings between the OIR staff and the NCCI staff were designed to, and had the effect of shutting the public out of meaningful participation in the rate making process," Gievers wrote in a strongly worded rebuke last month.
The judge also found that NCCI refused to turn over records from those meetings to an attorney who carries workers' compensation insurance for his law firm, in violation of Florida's public records law, and blocked the rate increase from taking effect Dec. 1.
Gievers' decision followed the Florida Supreme Court opinions that properly sided with protecting the rights of injured workers. In a 5-2 opinion in April, the Supreme Court said that a 2009 state law limiting attorney's fees is unconstitutional because it prevents challenges to the "reasonableness" of attorney's fees awarded in workers' compensation cases. The ruling stemmed from a case in which an attorney was awarded the equivalent of $1.53 an hour representing an injured door manufacturing employee in Miami. The court said the cap on attorneys' fees, which had the effect of discouraging more people from filing claims, violated workers' right to due process.
In June, the Supreme Court said in another 5-2 opinion that the time limit on temporary benefits for injured workers is unconstitutional. The ruling came in the case of St. Petersburg veteran firefighter Bradley Westphal, who suffered a severe back injury during a house fire. He couldn't return to work, and his temporary benefits ran out after the law's two-year maximum. But doctors also would not approve Westphal for permanent disability. The court properly found that left Westphal in a "statutory gap" and voided the limit on temporary benefits.
Workers' compensation insurance is arcane, even boring — unless you're among thousands of business owners across Florida who pay the premiums. Or a worker who relies on a sustainable system that protects people who may be injured on the job. The fact is, all Floridians have a stake in a system that has a real impact on the state's economy. The crucial work of insurance regulators — setting rates — must not be shielded from the public. The circuit judge's demand for sunshine is certain to be appealed, and the cloak of darkness should not be allowed to return.