• The National Council on Compensation Insurance (NCCI) has proposed a 15.1 percent reduction in workers’ compensation insurance rates for businesses providing coverage in Florida.
• The proposal is based on data analysis from Policy Years 2020 and 2021, indicating positive loss experiences during this period and reflecting the impact of the ongoing COVID-19 pandemic.
• Nationally, the workers’ compensation system across the nation reflects positive trends, with the NCCI reporting that lost-time claims relative to premium payments recorded a 4 percent decline compared to the year prior

The National Council on Compensation Insurance (NCCI) put forth a proposal on Friday for adjustments to workers’ compensation insurance rates in Florida, potentially taking effect at the beginning of the next calendar year.

The proposal recommends a reduction of 15.1 percent in the rates applicable to businesses that provide workers’ compensation coverage. The suggested reduction is predicated upon an analysis of data derived from Policy Years 2020 and 2021, according to a report filed by the organization, extending up until the end of 2022.

This report reflects favorable loss experiences during these periods, serving as a key factor in the proposed rate decrease. While considering potential challenges stemming from increased medical costs, owing to a recent legal decision, NCCI has affirmed the continued validity of the existing stop-loss provision within the 2014 Edition of the Florida Reimbursement Manual for Hospitals.

On a broader scale, the workers’ compensation system across the nation reflects positive trends, with the organization reporting that lost-time claims relative to premium payments recorded a 4 percent decline compared to the year prior, aligning with a resurgence in employment and wage growth, which have returned to pre-pandemic levels.

“The performance of the workers’ compensation system remains healthy. Lost-time claims relative to premium have returned to their 20-year trend trajectory, declining 4 percent in the past year,” states the NCCI. “Employment and wage growth marked a return to pre-pandemic levels.”

Notably, the recent increases in wages outpace the average costs of claims, and there is an overall decrease in total claims. Moreover, claim costs have risen in 2022, with overall expenditures stemming from claims increasing by around 5 percent and indemnity claim costs rising by approximately 6 percent.

Nationally, medical inflation is predicted to increase at a rate of about 3 percent annually compared with the long-term average of approximately 1.5 percent while remaining below the inflation rate of the Consumer Price Index. In the coming weeks, the Florida Office of Insurance Regulation will review the recommendation and issue a final decision on its authorization.