LETTERS: NCCI NOT THE CAUSE OF HIGH WORKERS' COMP RATES

To the editor:

On Dec. 4 you published a story headlined "Missouri's insurance division may dump NCCI." We want to set the record straight on issues raised in the article.

NCCI is the licensed statistics-gathering and workers compensation advisory organization in Missouri and 31 other states. Our primary function is to collect data related to workers compensation and recommend a rate level in each state. In Missouri, the voluntary market is completely deregulated, and each insurance company files its own individual rates, subject to approval by the Missouri Department of Insurance. For the assigned-risk plan, NCCI files a proposed rate plan also subject to approval.

Because NCCI proposes rates and rules, we are often viewed as the cause of the problem. Our role is limited to reviewing the data and proposing a rate level that will cover the losses that are expected to occur. Rates have been increasing in Missouri, because they are warranted.

Other states have had decreases in workers' compensation rates because of reform through comprehensive rewrites of their systems. Missouri hasn't instituted an effective medical cost-containment program. Injured workers are taking longer than ever to return to work. Disability ratings are established in an arbitrary manner. And the system, which was designed to be no-fault and self-executing, is an administratively cumbersome and confusing system that has an extremely high level of attorney involvement.

Do not criticize the NCCI if the costs in the state are high. They are nothing more than a reflection of the system.

MICHAEL A. TAYLOR

Director

Government, Consumer and Industry Affairs

National Council on Compensation Insurance

St. Louis