Workers' Compensation Reform in Kentucky
Issue Overview: In 1996, workers' compensation premiums exceeded $1 billion. The 1996 Kentucky General Assembly passed sweeping revisions that brought down premiums by as much as 40 percent. In the ensuing 10 years, court decisions have eroded these reforms to the point where premiums have reached the pre-reform 1996 level. Kentucky small businesses are paying higher workers' compensation premiums, stifling expansion and investment. This situation creates a disincentive for location to Kentucky and encourages business flight to surrounding states.
NFIB Position: Kentucky is returning to a non-competitive status with surrounding states. Areas that need to be addressed include:
- Amend subrogation laws to allow workers' compensation carriers to recoup medical expenses when another party is at fault, removing impact on rate risk modifiers.
- Protect employers from being liable for workers' comp claims by contract (1099) employees.
- Adopt national pain management protocols to limit pharmaceutical abuse.
Issue Status: Legislation is expected to be filed in the 2008 General Assembly. Please contact your state senator and representative, and ask them to support commonsense solutions to the rising cost of workers' compensation insurance.
