Workers' comp costs rising for fire, rescue

December 18, 2010|By HEATHER KEELS |

The premium for workers' compensation insurance for Washington County’s volunteer fire and rescue companies will more than double next year, due, in part, to a claim history about 2 1/2 times the national average, according to a report by Becky Maginnis, the county’s risk management administrator.

The Washington County Commissioners agreed Tuesday to pay the higher premium, but they also mandated that the Washington County Fire and Rescue Association attempt to rein in claims with mandatory physicals and other risk-management controls.

The county has paid the insurance premiums for the volunteer companies since the early 1990s.

The 2011 workers’ compensation insurance premium for fire and rescue companies will be $555,000, a 128 percent increase over the 2010 premium of $243,731, Maginnis said.

The insurance package for commercial property, auto and casualty insurance for fire and rescue companies also will increase for 2011, Maginnis said. That premium will be $410,000, up about 14 percent from the 2010 premium of $353,293. And that rate, though higher, requires higher deductibles than this year’s, she said.

The commissioners voted unanimously to approve those quotes to be paid on a quarterly basis and to implement recommended risk-management practices in hopes of reducing premiums in the future.

The coverage will be provided by Selective Insurance Co., the same company the county has used for about 10 to 15 years and the only one to respond with reasonable premium quotes, Maginnis said.

Because fire and rescue companies have expensive equipment and dangerous jobs, there aren’t many insurance companies interested in insuring them, she said.

The rising premiums are in part a reflection of general economic conditions catching up with the insurance industry, and fire and rescue claims in particular also are on an upward trend nationally, Maginnis said.

But the workers’ comp claims experience for Washington County’s fire and rescue companies is 2 1/2 times the national average, and that also is factored into insurance quotes, she wrote in a report to the commissioners.

A graph of claim costs shows workers’ comp payments of more than $400,000 in 2006 and 2007 and more than $700,000 in 2008.

The chart shows lower totals for 2009 and 2010, but that is deceptive because claims filed in those years still are being processed, Maginnis said.

Washington County’s rising claims costs primarily are due to occupational disease claims, such as heart disease and cancer, she wrote in her report.

Medical conditions such as heart disease and hypertension are, under state statute, presumed to have been caused by firefighting, said consultant Ed Seward of CBIZ Insurance Services Inc.

For example, if, two weeks after fighting a fire, a firefighter has a heart attack, there could have been unrelated causes, but that heart attack will be presumed to be related to firefighting and will be covered by workers’ comp, County Administrator Gregory B. Murray said.

“I’m told that those claims have been very expensive, and presumptive claims are, I wouldn’t say spiraling, but they’re getting more frequent,” he said.

Selective Insurance Co. was reluctant to renew the county’s fire and rescue insurance plans at all, but agreed to do so at the higher rates after the fire and rescue association agreed to a number of risk-management practices, Seward said.

For one thing, the association will require all active fire and rescue personnel to have annual fit-for-duty physicals at Health@Work, paid for by the association, association President Glenn Fishack said.

By the end of January, each fire and rescue station is supposed to have software installed that links directly to Health@Work to streamline scheduling and allow the company to monitor compliance, Murray said.

“They’ll be calling you ... ‘Your physical’s due, you need to come here right now,’” Fishack said. “If you don’t and we get a feedback, you’re not eligible to ride the truck or do anything.”

In addition, the county’s rehab trailer will be set up to automatically send information about the treatment of any firefighter at the scene of a fire to that firefighter’s record at Health@Work, Fishack said.

The association also will be required to investigate all claims and injuries, apply discipline for at-fault incidents, analyze the root cause of accidents and apply appropriate training. A safety committee will investigate incidents and oversee compliance, Maginnis said.

Paying the insurance premium on a quarterly basis will allow the county to evaluate, after each quarter, whether the companies are cooperating with the effort to control claims, Murray said.

“If we see that no effort’s being made ... maybe we should think about transferring some of the liability for funding somewhere else,” he said.

Paying quarterly also is necessary for budgetary reasons. County Budget and Finance Director Debra S. Murray said she was able to find enough unused funding in this fiscal year’s budget to cover the higher-than-planned premiums, but the county will need to factor the increased costs into its budgeting for fiscal year 2012, which begins July 1.

How they voted
The Washington County Commissioners voted 5-0 Tuesday to pay a higher premium for Washington County’s volunteer fire and rescue companies. The premium will more than double next year, due, in part, to a claim history about 2 1/2 times the national average.

  • Terry Baker — yes
  • John F. Barr — yes
  • Ruth Anne Callaham — yes
  • Jeff Cline — yes
  • Bill McKinley — yes

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