Workers’ Compensation: Benefits Decline While Insurer Profits RiseWednesday, July 17, 2019
A recent study published by the New School Center for New York City Affairs paints a rather bleak picture for injured workers in The Empire State. Although the New York workers’ compensation system was, at one time, the paradigm for the rest of the country, the focus has shifted from safeguarding the needs of injured workers to minimizing employer costs. This unfortunate change is outlined in a report entitled “Time for a Real Look at How the New York State Workers’ Compensation System Treats Workers”, by James Parrott and Nicholas B Martin.
According to the report, there was a 15 percent decline in the dollar amount of workers’ compensation benefits from 2014 to 2017, while insurance profits rose by 95 percent. These staggering figures shed light on the real problem. “What we see here are record profits for insurance companies coupled with steadily declining benefits for injured workers,” says William Turley, Senior Partner at Turley, Redmond, Rosasco, and Rosasco.
The study describes New York’s indemnity benefit structure as flawed and inadequate. New York State’s minimum benefit of $150 is less than half of the $339 average for five neighboring states. Even though New York has the highest statewide average weekly wage, it’s maximum benefit of $871 in 2018 ranked 29th across all states.
The authors’ analysis also outlined that 75 percent of all cases in New York State, which is more than 200,000 cases, are concentrated in low-wage industries. Furthermore, the report claims that New York State has seen a recent spike in deaths on the job, while on-the-job fatalities across the United States remain flat. In the best-case scenario, an indemnity benefit to an injured worker is a maximum of two-thirds that worker’s average wage the year before the injury. The authors state that “National experts recommend that the wage base be adjusted annually to reflect a worker’s earnings potential rather than the pre-injury wage. This would include periodic wage increases, and promotions workers usually receive over the course of their careers.”
In 2017, benefits paid were only 55 percent of workers’ compensation premiums according to Parrott’s and Martin’s report. In that same year, insurance profits exceed $1 billion. This seemingly backwards system outlined in this study is a great cause for concern. “This study is not a reflection of who we are as New Yorkers. We don’t treat our people this way and when we see something like this, we fix it. So let’s fix it. I urge all our lawmakers to read this study, get on the right side of the issue, and join me and many others, in preserving and protecting the rights of injured and disabled workers.” stated William Turley as he spoke on behalf of Workers at the steps City Hall in New York City.
If you, or a loved one, is in need of assistance in obtaining or receiving benefits due to a work injury, please contact the experienced lawyers at Turley, Redmond, Rosasco, and Rosasco at 855-280-7586 for a free no-obligation consultation.