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Wednesday, September 08, 2004
Bureau
Stands By 3.5 Increase
SAN FRANCISCO- Based on the June 2004 actuarial data, the Workers’
Compensation Insurance Rating Bureau Governing Committee has voted
to stand pat on its recommended pure premium rate increase of
3.5 percent.
The increase
is based on benefits increases enacted by AB 749, but Bureau
execs reminded the members of its Committee – made up
of mostly out-of-state carriers -- that but for the workers’
comp reform legislation passed in fall 2003 and early spring
2004, employers would have been looking at a recommended 50
percent increase in January 2005 rates.
“The
good news is our projections are holding,” says Dave Bellusci,
the Bureau’s senior actuary.
According
to Bureau actuaries, the Department of Insurance, using the
same methodology it used to determine the advisory pure premium
rate for July policies, came up with a three tenths percent
increase in rates from AB 749. The Department has not calculated
its January rate recommendation yet and says it will not do
so until after the hearing next week.
The decision
not to change the recommendation left some members, who had
hoped for a greater reduction from the provisions of SB 899,
fuming.
“You’ve
been trying to get employer control of medical care for years.
If it was so important it must mean something. We should see
a 10 percent decrease in rates at least,” says Tom Rankin,
retired president of the California Labor Federation.
The rates
are not the fault of the Bureau. It is the legislature who failed
in its final hours to clean up the reform bills and an administrative
bureaucracy that can’t seem to timely develop a medical
fee schedule. And let’s not fail to remember that it is
the lawyers, in the end, who so successfully assist the system
in driving up the costs.
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