(This is another in FIC’s special reports on insurance issues expected to surface during the 2014 session.)

HB 785 by Representative Ben Albritton (R-Bartow) and SB 952 by Senator Wilton Simpson (R-Trilby) create a new subsection under s. 627.072, F.S. to permit an insurer to offer a retrospective rating plan that allows the insurer to negotiate the premium with the employer. In order to qualify, the employer must have multistate exposure and minimum workers’ compensation premium of $175,000 in Florida and $1 million countrywide.

HB 785 is referred to the House Insurance and Banking and Government Operations Appropriations Subcommittees and the Regulatory Affairs Committee.

SB 952 is referred to the Senate Banking and Insurance, Commerce and Tourism, and Governmental Oversight and Accountability Committees.

The retrospective rating issue is also contained in the “omnibus” insurance package, HB 565SB 1260 currently making its way through the legislative process.

Retrospective rating is a top priority of the FIC Workers’ Comp Committee, although we continue to discuss the specific details.

Division of Workers’ Compensation Package

The Division of Workers’ Compensation is supporting legislation to address concerns raised by employers. The 2003 workers’ compensation package included strong mandatory coverage provisions backed by strict stop-work enforcement by the Division.

HB 271 by Representative Travis Cummings (R-Orange Park) and SB 444 by Senator Bill Galvano (R-Bradenton) are intended to rebalance the need for compliance with a desire to avoid unnecessarily shutting down worksites and negatively affecting employers and employees. FIC has worked closely with the business community and the Division to arrive at an appropriate balance.

Among other provisions, the bills give employers 10 business days (instead of 5) to produce proof of coverage before being subject to a stop-word order, and authorizes the Division to release the stop-work order if the employer secures coverage, makes a $1,000 down payment on the assessed penalty and agrees to pay the remainder of the penalty.

The bills also reduce the look-back period for failure to comply with coverage requirements from 3 to 2 years, and increase the penalty multiplier from 1.5 to 2 times the amount of unpaid premiums. The bills also clarify and reaffirm the calculation of the average weekly wage indemnity benefit placed into question as a result of a court decision.

The bills were amended in committee to require the Special Disability Trust Fund (SDTF) assessment to be calculated in the same manner as the Workers’ Compensation Administration Trust Fund assessment, and reduce the SDTF assessment cap from 4.52% to 2.5%.

HB 271 and SB 444 have each passed two of three committee references. HB 271 must still pass the House Regulated Industries Committee, while SB 444 must still pass the Senate Appropriations Committee.

FIC workers’ comp lobbyists and representatives of other stakeholder groups have been working with DWC on this package since last summer.

Workers’ Compensation Package / Major Contributing Cause

HB 1007 by Representative Dave Hood (R-Daytona Beach) and SB 1214 by Senator Alan Hays (R-Umatilla) address a number of issues raised in various forums. Not specifically a product of the carrier community, the bills contain provisions relating to drug testing for both causation and during treatment, apportionment of preexisting conditions, and advance compensability payments. The bills also bar permanent total benefits if the employee can perform light-duty work, and state that a preexisting conditions are not limited to work-related conditions and may be considered when determining major contributing cause.

The future for the bills is unclear. HB 1007 is referred to the House Insurance & Banking and Government Operations Appropriations Subcommittees and the Regulatory Affairs Committee. SB 1214 is referred to the Senate Governmental Oversight and Accountability, Judiciary, and Appropriations Committees.