Nixon Administration Study on Federalizing Workers Comp

I have written many times on prepping for the federalization of Workers Comp. The Nixon Administration’s efforts to possibly make Workers Comp a federal insurance program was unknown to me at the time I wrote many of the federalization articles.

(

c) Public Domain

Thanks to WorkCompCentral; Adjunct Professor Torrey, and John J. Burton Jr. for bringing up an old governmental study of recommendations on what to do about Work Comp in the early 1970s. The 50-year-old study shows that some of the state laws were not adequate in covering injured workers.

The public domain study can be accessed here.

I recommend at least downloading the introduction and executive summary. One can see that Workers’ Comp has come a long way since the study was published.

The Study’s Recommendations To The Nixon Administration

The study made 19 recommendations.  I am not going to cover them all. I will cover the recommendations that were not followed by all the states and the possible reasons.Please note that I am writing from the point of carriers, self-insureds, and employers.

• That employers aren’t exempted from workers’ compensation coverage because of the number of their employees – many states have a minimum number of employees requirement. Having a sole proprietor or micro-company pay workers comp premiums may push that company out of business- not a good move for entrepreneurialism.
• That total disability benefits are paid for the duration of the worker’s disability, or for life, without any limitations as to the dollar amount of time – see the next bullet point
• That there are no statutory limits of time or dollar amount for medical care or physical rehabilitation services for any work-related impairment – having no-limit benefits would cause a spike in insurance rates as carriers would have to cover huge unknown benefits for which they have received no premium. For example in North Carolina (1994) a State Supreme Court decision made all claims have lifetime medical benefits. All the big insurance carriers started pulling out of the state.  The legislature expediently passed new laws to limit the length of time that a claim could be reopened.

Almost all states complied with the other 16 recommendations with few exceptions. I agree with the other 16 recommendations made in the report.

The Major Unmentioned Recommendation + One Error

The study recommended that the Nixon Administration not federalize the Workers’ Comp programs if the states would enact the recommendations.

Do you see the big error that dates this report?  The title has Workmen’s Compensation instead of Workers’ Compensation. That phrase would be castigated nowadays.

I have often said that Workers Comp has stayed the same forever and ever.  Now that I look at the concerns and recommendations that states have enacted since the Nixon Administration study, I see that some positive changes have occurred over the last 50 years.

This blog post is provided by James Moore, AIC, MBA, ChFC, ARM, and is republished with permission from J&L Risk Management Consultants. Visit the full website at www.cutcompcosts.com.

Share This Article: