With No Legislative Fix In Sight, Court Reinstates Workers’ Comp Rate Increase

First District Court of Appeals Officially Reinstates 14.5 Percent Increase

Just one day after lawmakers closed out the 2017 Legislative Session without fixing Florida’s broken workers’ compensation system, the First District Court of Appeals (DCA) today issued a ruling reversing a lower court’s ruling and officially reinstated the 14.5 workers’ comp rate increase  which originally took effect December of 2016.

The DCA made its ruling on the National Council on Compensation Insurance (NCCI) and Office of Insurance Regulation (OIR) v. James Fee case. Fee is a workers’ comp trial attorney. Fee filed a lawsuit against NCCI and OIR arguing that they violated the Sunshine Law while determining the rate increase associated with two Florida Supreme Court rulings. Days before the rate increase was to take effect, the Leon Circuit Court invalidated the 14.5 percent workers’ comp increase under the grounds that the Sunshine Law had been violated. After the case was appealed to the First DCA, a stay was issued, allowing the rate increase to take effect. The First DCA found that NCCI and OIR complied with the multiple elements of the Sunshine Law and that the rate increase should take effect.

Unfortunately, this decision comes the day after the Florida Legislature concluded the 2017 Legislative Session without taking steps to protect job creators from this rate increase. Throughout session, NCCI and Florida’s workers’ comp ratemaking process were consistently under attack by the trial bar.

The Florida Chamber of Commerce fiercely advocated for a fix to Florida’s broken workers’ comp system, and believe that this case was designed to serve as a distraction from the real issue at hand – resolving the Florida Supreme Court decision that led to the 14.5 percent – or $1.5 billion – workers’ comp rate increase in the first place.

 

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Support our efforts to help make workers’ comp rates affordable for job creators. Join the Florida Chamber Workers’ Compensation Task Force.

Workers’ Comp Rate Increase to Stay in Effect During Appeal

Yesterday evening, the First District Court of Appeals ruled that the 14.5 percent rate increase will continue to be in effect while the Office of Insurance Regulation (OIR) and National Council on Compensation Insurance (NCCI) appeal a case from the Leon Circuit Court last month. This case, brought forward by a trial lawyer, argued that the rate-making process violated Florida’s Sunshine Law. The DCA also granted NCCI’s motion to expedite the case, and set the following timeline:

  • January 11, 2017
    OIR and NCCI must file arguments on the merits of the case
  • January 23, 2017
    James Fee, the trial attorney who brought forward the case, must respond to OIR and NCCI’s filing, and
  • February 2, 2017
    Final briefs must be filed.

What This Means for Florida Businesses:

The Leon Circuit Court in its decision invalidated the rate increase, but the District Court of Appeals allowed the rate to take effect on December 1 for all new and renewal policies. This case is a red herring, meant to distract from the real problem- increased attorney fees as a result of the Castellanos v. Next Door Company Florida Supreme Court decision. In fact, claimant attorney fees are up over 20 percent since the Supreme Court’s decision in April.

 

What’s Next:

Today, the Florida Chamber will testify before the Florida Senate’s Banking & Insurance Committee to fight for a workers’ comp system that works. Share your story with us by contacting cjohnson@flchamber.com today.

Learn how the Florida Chamber of Commerce Workers’ Comp Task Force is working on a legislative solution to the $1.5 billion increase to Florida’s business community.