WORKERS' COMP NEEDS MAJOR WORK FROM LEGISLATORS

Missouri's system of workers' compensation, which is an employer-funded insurance program for employes who are hurt on the job, is broken. Five consecutive years of double-digit rate increases have signalled this troubling reality. An attempt at reform was made nearly two years ago, when Senate Bill 251 was enacted into law.

SB 251 was a nice try, but it is pitifully inadequate when measured against real reform. To cite one example, there is in it a provision permitting reopening of claims. An injured employee is now permitted to reopen a closed claim at any time. Claims such as heart attacks and strokes will, in essence, never be truly closed.

A reform bill is being introduced by a bipartisan group of lawmakers. Senate sponsors include John Scott, D-St. Louis, Franc Flotron, R-Creve Coeur and Peter Kinder, R-Cape Girardeau. On the House side, Rep. Mark Richardson, the new minority leader, will take the lead. Other lawmakers are urged to sign on in support of this bill. Business leaders must get involved in stressing to their lawmakers to the urgency of enacting reforms in the coming session of the General Assembly.

One small Southeast Missouri trucking company has seen the its workers' compensation costs spiral in recent years: 1991: $6,400; 1992: $13,600; 1993: $29,474. Its struggling owner writes, "I can't stay in business much longer with costs like these."

Such stories are common. They should haunt legislators charged with writing laws to ensure a healthy Missouri business climate. Those who say SB 251 "fixed" the problem should sit with the anguished owner of that trucking company as he wonders how he can keep his doors open. He looks down the road and sees nothing but a continuing cost nightmare. Real action is needed this session.

Workers compensation is a complex program whose purpose is to compensate workers who suffer injuries in the course of their duties at the workplace. As originally conceived early in this century, it was to function with a mimimum of lawyer involvement, the better to efficiently compensate injured workers.

Over the last decade, all this has changed. By any measurement, lawyer involvement has exploded. One reputable national study has concluded that Missouri has the most litigious workers' compensation system in the nation. Lawyer involvement in cases statewide is 40 percent. In the St. Louis area, it is 60 percent. There is no disputing this adds dramatically to overall costs of the program.

Neighboring states such as Kansas, Arkansas and Nebraska have taken the decisive action necessary to reduce workers comp costs. Oregon and Colorado are other states that have passed through the crisis of spiralling costs and moved on to real reform. Businesses there are actually seeing back-to-back years of cost reduction.

It follows that we know how to reduce costs. It simply remains for lawmakers and Gov. Mel Carnahan to summon the political will to act as these other states have done. If they don't, Missouri will increasingly be placed a disadvantage relative to other states when it comes to business relocations or expansions. It is as simple -- and as frightening -- as that.

The annual price tag for Missouri's out-of-control workers' compensation system exceeds $1 billion. Workers' compensation is a jobs issue of the first order. Missouri is experiencing a threat to jobs as small- and medium-sized businesses close their doors or fail to expand due to this crushing cost burden. It is impossible to calculate the number of jobs that never located here because businesses reviewed Missouri's higher costs and chose a lower-cost state. In an age when businesses are more portable than ever, we must not lose sight of this crucial fact.

Lawmakers and Gov. Carnahan must work together in the session that begins Jan. 4 to address this critically needed reform.