The Oklahoma Senate on Tuesday approved a Republican-backed plan to overhaul the state’s workers’ compensation system and to cut more than $100 million annually from injured worker benefits, sending the proposal to Gov. Mary Fallin for her likely signature.
After weeks of rewrites and adjustments before it passed the House, the bill cleared the Senate with a 35-12 vote Tuesday along party lines. All Democrats present opposed the bill, along with one Republican. Fallin is expected to sign it after she and other Republican leaders came to an agreement on its outlines last week.
The plan would convert Oklahoma’s judicial workers’ compensation system to an administrative system, bringing it in line with almost every other state. It also allows businesses to opt out of the system within certain guidelines. Once implemented, the policy would save $125 million in employer costs each year, according to an analysis by the National Council on Compensation Insurance, an organization whose board of directors includes several insurance company officials.
According to the latest NCCI analysis, nearly all of the overhaul’s concrete savings — roughly $120 million annually — come from cutting disability payments. Temporary total disability payments would be available for two years instead of three, for example, and would be limited to 70 percent of the state’s average weekly wage — about $550 a week — no matter how high a worker’s original salary.
Republicans hailed the bill’s passage, saying the new system would save time and money for everyone involved by tossing out a court system that pitted workers against their employers.
“We should be working towards helping those employees get back to work on a quicker basis, rather than encouraging a system that keeps them delayed for many, many years on end,” said Sen. Dan Newberry, R-Tulsa, before the Senate vote. “This is not only the right bill for the state of Oklahoma, it’s the right time.”
Echoing their counterparts in the House, several Senate Democrats condemned the bill. They agreed the system needed to be changed but accused Republicans of saving money by cutting injured worker benefits while doing little to address medical costs.
“We also know that 45 percent roughly of the costs of the system is due to medical expenses,” said Minority Leader Sen. Sean Burrage of Claremore. “So we have a bill here today that has $263 million in savings over a number of years ... and we’ve saved every penny of that by taking away benefits from the injured workers. Every penny of it.”
Republicans dismissed concerns over worker payments, saying everybody would benefit from the new system’s streamlined structure and lowered costs.
“It’s a win-win for employer and employee in every circumstance, especially in Arkansas when I went to visit with them,” said Sen. Anthony Sykes, R-Moore, referring to Oklahoma’s neighbor that has a similar workers’ compensation system. “It removes the incentive to get injured to get a raise.”