AUGUSTA — Before 2012, under Maine’s workers’ compensation statute, one in four injured workers with partial incapacity was guaranteed lifetime benefits, depending on the permanent impairment from the injury.
That’s right: One in four of those injured like this was guaranteed lifetime benefits – no matter their work capacity. And becoming part of this 25 percent often became the subject of frequent and costly litigation.
In 2012, the Legislature made some important changes to this and other portions of our workers’ compensation law that were recently the topic of a column by Jeffrey Cohen (“Maine Voices: Elect leaders who want to support, not punish, injured Maine workers,” March 18), in which he took exception to fixing a law that he viewed as “not broken.”
This “guarantee” in Maine law had, in fact, long been a recognized problem by both labor and employers. Time and again, employers, insurers and even Govs. Angus King and John Baldacci had asked labor representatives to help find a way to bring greater certainty to our system regarding this group of injured workers. And each time, led by the trial attorneys who stood to benefit from the large settlements associated with these cases, they refused to talk.
So the Legislature decided enough was enough and took on this tough issue. And they did pass changes to our workers’ compensation law. But Cohen conveniently leaves out some very important details.
These include, for example, that the final bill was passed with bipartisan support – particularly in the Senate – and that the changes to our workers’ compensation law included increases in benefits for many injured workers. You read that right.
Section 213 – the part of our workers’ compensation law that governs extended benefits for workers who are injured and left with “partial incapacity” – was, in truth, unfair almost from the day it was enacted in 1992. It created winners and losers in terms of long-term benefits, with winners entitled to potentially lifetime benefits, determined by mere fractions of a percentage point.
Above the percentage, and you became entitled to a large settlement, with your attorney taking his/her fee out of the settlement. On the edge of the cliff, but not over – sorry, you weren’t entitled to long-term benefits. It was that simple.
Now throw in the fact that the old law guaranteed that one in four Section 213 injuries became lifetime settlement cases regardless of the injured employee’s work capacity, and you have a system that treated benefits under this section unlike any other in the country.
It’s important to note two things when assessing these changes:
n First, the changes made less than two years ago haven’t affected a single case up to this point. In fact, we are unlikely to see any systemic impact for another eight to 10 years. No injured workers today are being negatively affected by the 2012 changes.
n Second, the new law protects the most seriously injured workers, who are unable to work at all or who are earning less than 65 percent of their pre-injury wage 10 years after the injury. In other words, our law finally ties extended benefits to an individual’s ability to work and earn.
The “losers,” if you will, are the workers’ compensation attorneys, who stand to make less money because of less litigation and lower settlements – shocking.
Two other points that readers should keep in mind:
n First, the recent reduction in workers’ compensation rates has nothing to do with the changes made in 2012. It does, however, have everything to do with employers making their workplaces safer, and reducing both the frequency and severity of workplace injuries. That is a very positive outcome of the 1992 reforms of 22 years ago.
While it is true that costs in Maine have decreased significantly since the 1992 reforms, we should remember that Maine’s costs were the highest in the country before 1992, and that Maine’s costs remain above average nationally.
n Last, politics plays a huge role in what happens in Augusta. And the outcome of the November elections in the Legislature and for governor will go a long way in determining the policy direction in workers’ compensation and for business issues in general.
That’s why all Mainers should sit up and take notice when the United Steel Workers, a huge, outside, national labor union, donates $300,000 to the Maine Democratic Party to help elect legislative and gubernatorial candidates. That’s a down payment, and they will be expecting a return on that investment.