FLA. GOVERNOR GAINS GROUND IN BID TO REFORM WORKERS COMP SYSTEM

FLA. GOVERNOR GAINS GROUND IN BID TO REFORM WORKERS COMP SYSTEM

Lawmakers have agreed to dramatically change the way Florida businesses insure workers injured on the job in an attempt to cut premiums by at least 20 percent.

The reforms are a major victory for Gov. Lawton Chiles, who traveled the state preaching about curbing the soaring costs of workers compensation.Lawmakers met most of the governor's demands after he ripped apart their first deal last week and forced them to extend their special session. Earlier this week, Gov. Chiles indicated he will sign a newly crafted bill.

''We have got a very persuasive governor who has shown a great deal of inflexibility," said Sen. W.D. Childers, D-Pensacola. "We are going out of our way to accommodate Lawton Chiles."

Gov. Chiles did not get everything he wanted. Legislators refused to make insurers pay fees that would subsidize the rates for small firms with high risks.

Instead, lawmakers created a joint underwriting association that will sell coverage to businesses that can't find it elsewhere by charging higher rates.

The largest chunk of savings would come from a 10 percent cut in premiums for steering injured workers into a managed care system, such as a health maintenance organization. Those systems are designed to cut medical costs by limiting trips to the doctor and preventing unnecessary treatments.

Injured workers who file a claim also would be required to use mediation to try to resolve differences with their employer or the insurer - another attempt to avoid high legal bills.

While bemoaning cuts in workers' benefits, lawyers also don't like the cuts in their fees.

The agreement cuts the state fee schedule for lawyers by 5 percentage points in each range. For example, legal fees would be limited to 20 percent of the first $5,000 of benefits instead of the current 25 percent.

Trial lawyers say the actual cut in total fees could be up to 33 percent in some cases. The average legal fee in a workers compensation case would be reduced by 25 percent, from the current $2,887 to $2,174.

With an eye toward cutting costs, lawmakers agreed to sweeping changes in a workers compensation system that has been around since 1935. They say they are confident the reforms will meet Gov. Chiles' requirement of a 20 percent reduction in premiums.

But the numbers aren't solid. The savings could be up to 24 percent, although they aren't likely to reach that level right away. Actuaries also said the cut could be as little as 12.7 percent.

"Take the low end," said Rep. Jim King, R-Jacksonville, "and it's a disaster."