Missouri considers restrictions on injured worker fund

Monday, February 15, 2010 | 8:02 p.m. CST

JEFFERSON CITY — A Missouri House of Representatives committee is considering legislation designed to stabilize a financially troubled state fund for injured workers by triggering higher workers' compensation premiums for employers.

Missouri's Second Injury Fund takes businesses off the hook for paying the claims of workers with previous injuries or conditions who are re-injured on the job. Analysts have warned for years that the fund — financed from a surcharge employers pay on their workers' compensation insurance — was running out of money.

Legislation considered Monday would shift some injured worker claims from the Second Injury Fund to the workers' compensation system. That is expected to lead to higher premiums for workers' compensation insurance and therefore more money coming into the Second Injury Fund through its surcharge.

The Second Injury Fund surcharge was capped at 3 percent under a 2005 law. Previously, the fee increased and decreased based on a formula created by the state Department of Labor and Industrial Relations. Business groups and Republican leaders have said they do not want to increase that surcharge.

Rep. Barney Fisher said his bill "nudges" the Second Injury Fund toward stronger financial stability. The House committee Fisher leads is expected to vote on the bill next week.

Fisher, R-Richards, said it's better to have slightly higher workers' compensation premiums than increasing the surcharge, but acknowledged the result is similar for businesses.

"It's a tomato, tomato kind of thing," Richard said.

Lawmakers have debated the financial problems of the Second Injury Fund for several years. Studies by the state auditor and the accounting firm, PricewaterhouseCoopers, concluded the fund would likely run out of money.

Business groups on Monday generally endorsed Fisher's bill while repeating their opposition to increasing the surcharge employers pay.

Trey Davis, a lobbyist for the Missouri Chamber of Commerce and Industry, said its unknown exactly how shifting some claims to the workers compensation system would affect insurance premiums. He said employers would prefer to handle more of the claims through the workers' compensation system than through the troubled Second Injury Fund.

The Missouri Association of Trial Attorneys said the cheapest and most efficient fix for the Second Injury Fund simply is to increase the employer surcharge.

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