The cost of workers’ compensation will be about $400 million less in 2017-18 for employers across the state because of a 4.5 percent rate decrease expected to be approved by the state Department of Financial Services, Gov. Andrew M. Cuomo announced.
He said the New York Compensation Insurance Rating Board, a nongovernmental agency, had recommended the rate decrease to the department, effective Oct. 1. The savings will occur in the 12 months ended Sept. 30, 2018.
The board recommended the lower rate based on changes to the workers’ comp system that were included in the recently adopted state budget. The changes were the first major overhaul since 2007.
The changes include limits to temporary benefits paid to injured workers, updated guidelines for medical impairment determinations, and ways to reduce prescription drug costs.
Cuomo said in a statement Monday that “with the rate decrease, New York is providing real savings to businesses, helping to make them more competitive while strengthening protections for injured workers.”
Labor groups lauded the changes to the workers’ comp system.
“We said we would prevent benefit cuts, and we did,” said Mario Cilento, president of the state AFL-CIO. “In addition, we maximized and maintained benefits for the most seriously injured workers which will allow them to continue to lead their lives with dignity after being injured on the job.”
Heather C. Briccetti, president of the trade group The Business Council of New York State, predicted the 2017-18 savings “are just the beginning.”
She also lauded the state Senate’s Republican majority, led by Sen. John J. Flanagan of East Northport, for spearheading the drive to reduce workers’ comp costs.
Flanagan noted that governments and not-for-profit organizations pay into the workers’ comp system and also would benefit from the rate reduction.
Separately, Cuomo announced that the state Workers’ Compensation Board will be introducing “virtual” hearings so that workers and employers will no longer have to attend physical hearings. The board’s local office is in Hauppauge, and a hearing site is in Hempstead Town.
About 143,000 new claims were received in 2015; more than 14,300 were from Long Island, according to the most recent available data. New York’s comp system was established in 1914.