An article in the Insurance Journal says that the reaction from an employers’ group to a suggested hike in California’s advisory workers’ compensation rates of nearly 7 percent was – surprisingly – cautiously optimistic. The Workers’ Compensation Action Network, a group that represents the interests of employers, expressed hope that reforms ushered in last year will take hold and keep rates from continuing to head upward.

“It’s too early to tell whether the 2012 reforms will help blunt or reverse the trend,” Jerry Azevedo, a WCAN spokesman said. “The system is in the process of absorbing substantial benefit increases under SB 863. Regulators are only partially through their efforts to implement a variety of process changes intended to make the system work more efficiently. These changes, however, were really intended to offset the benefit increase, rather than cut costs.” What the group finds most distressing has been a 35 percent increase in premiums since 2009 is that the both the cost and frequency of claims now seem to be trending up again in 2013 after a few flat years. “It’s too early to tell whether the 2012 reforms will help blunt or reverse the trend,” Azevedo said. “The system is in the process of absorbing substantial benefit increases under SB 863. Regulators are only partially through their efforts to implement a variety of process changes intended to make the system work more efficiently. These changes, however, were really intended to offset the benefit increase, rather than cut costs.”

“The margin of error in getting the SB 863 reforms right is very small, and we still won’t know their impact for months or years,” Azevedo said. “There’s also litigation and other attacks that could undermine what the legislature was attempting to achieve. We’re cautiously optimistic, but employers continue to look for ways to make the system more fair and efficient for all parties.”