By Tom Murphy of Danna-Gracey

Even before he ever took office it was clear that Governor Rick Scott was serious about changing Florida’s legislative and regulatory landscape. One of his campaign pledges included reducing workers’ compensation costs by 35%. He recently renewed this pledge to the Florida Council of 100 shortly after taking office. This could be a formidable task given the fact that Florida rates have decreased by 64.7% since the major legislative reform in 2003.

Recently, Florida Insurance Commissioner Kevin McCarty approved a 7.8% rate increase that went into effect on 1/1/11. The reasons for the current rate increase are changes in claims experience and frequency. The dramatic decline in claims between 2003 and 2007 appears to have slowed, leading some experts to assert that the 2003 reforms have run their course.

Many industry leaders believe that the only possible way to cut workers’ compensation costs further would be to change benefits or reforms associated with prescription drug benefits. Specifically, legislation that would apply the pharmaceutical fee schedule to repackaged or relabeled drugs. Additionally, the legislature may find itself dealing with other issues, such as apportionment, that involve separating costs associated with pre-existing injuries.

One thing is clear. Nobody knows how the current legislature will respond to Governor Scott’s ambitions to further reduce Florida’s workers’ compensation costs. Undoubtedly, he will push forward for these changes that will be welcomed by medical practices and all Florida businesses and vehemently opposed by injured workers and their attorneys.