Workers' Compensation System a 'Colossal Failure', Report Says

Sept. 22, 2006
Workers across the country often have to contend with "adversarial bureaucracy and inadequate benefits" when they file a workers' compensation claim, according to a report issued by the Center for Justice & Democracy (CJ&D).

The report "Workers' Compensation: A Cautionary Tale" describes the nation's workers' compensation system as a "colossal failure" and contends that while workers' benefits continue to shrink, insurance companies reap the benefits.

"Workers' compensation is an unfortunate example of how a seemingly fair program can be manipulated by political forces into a nightmare for those it was originally meant to help," said CJ&D attorney and policy analyst Amy Widman, the report's author.

The report contends that the workers' compensation system has deteriorated since its inception in the late 1940s. The report examines several states' legislative battles that, the report asserts, illustrate how workers nationwide are being stripped of benefits that would have been available to them 50 years ago.

A combination of factors such as the slashing of benefits, unprecedented eligibility requirements and continuous industry lobbying of politicians and agency administrators have prompted workers' compensation programs in many states to be essentially gutted, leaving injured workers without adequate help to care for their families, according to the report.

Workers' Compensation System Offers a "Cautionary Tale"

The CJ&D Report brands workers' compensation a "cautionary tale" about the pitfalls of administrative compensation programs that take away someone's right to trial by jury, such as proposed "health courts" for medical malpractice victims.

The report was co-released with safety advocacy groups such as the New York Committee for Occupational Safety and Health (NYCOSH). In response to the report, NYCOSH Executive Director Joel Shufro said it was ironic that New York boasts the nation's highest wages but has the lowest weekly benefits.

"New York State's workers' compensation system falls far short of meeting the needs of injured workers," Shufro said. " It is inexcusable that the benefits have fallen so far that seriously injured workers are being pauperized."

WorkSafe Acting Executive Director Fran Schreiberg said that because California Gov. Arnold Schwarzenegger vetoed legislation that would have doubled benefits for newly disabled workers in the state, their benefits continue to be reduced by 50 percent.

"With employer costs continuing to drop and insurance company profits continuing to rise, the governor should have approved this reasonable measure of justice for permanently injured workers," she said.

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