Pennsylvania employers are staring at two potential hikes in what they pay for workers compensation insurance.
The first increase was supposed to take effect Nov. 1 but has not yet been approved by state regulators. A second, smaller increase is slated to take effect April 1, but assumes the first increase is given the go-ahead.
Both requests came from the Pennsylvania Compensation Rating Bureau, an independent nonprofit that helps set workers’ comp premiums. It is based in Philadelphia.
Taken together, the hikes represent an increase of 6.76 percent in workers comp premiums. They follow a state court ruling invalidating a tool that observers saw as crucial to holding down workers comp costs in Pennsylvania.
The first increase drew opposition from a trial lawyers group, which has questioned the calculations supporting the increase. The group, the Pennsylvania Association for Justice, estimated that the first increase would cost businesses $165 million overall.
By law the Pennsylvania Insurance Department has 180 days to consider rate requests. The first request was originally made in August.
The court ruling at issue barred the use of so-called impairment rating evaluations, or IREs. The evaluations allowed companies to cap costs for paying out wages lost due to injury, typically in cases where workers could not return to work.
Critics of the rate increase have argued that other tools still available under state law also can help keep costs down.