Property Casualty 360 just published its 10 workers’ compensation trends to watch in 2018.” Healthcare consolidation, new drug treatment guidelines, and judicial challenges are a few of the issues impacting workers’ compensation specialists this year.

Thirty-four of the 50 state governors are currently Republicans. This, combined with the fact that insurance rates are down in most of the U.S., means we have not seen a significant push for workers’ compensation reforms the last few years.

But, in California, it is Governor Brown’s last year. Thus expect “yet another push by the legislature to undermine prior workers’ compensation reforms. Universal healthcare will likely be an issue in the 2018 governor’s race and the outcome of this election could have a significant impact on workers’ compensation in 2019.”

Concerns about the new Governor were also the topic of the presentation this month at the Employer’s Fraud Task Force meeting. Jerry Azevedo, from the Workers Comp Action Network expressed similar concerns.

And California seems to be ahead of the trend on drug formularies. In 2018, California, New York and Arkansas will all be implementing new treatment guidelines or drug formularies. Montana is also implementing a drug formulary but the timeline for this is not set yet.Georgia, Pennsylvania, North Carolina and Louisiana all considered either treatment guidelines or drug formularies in 2017 and they will revisit this again in 2018.

And California is also ahead of the trend to challenge the constitutionality of aspects of workers’ compensation law. Last year, Pennsylvania joined the list of states to have a portion of their workers’ compensation statutes found unconstitutional by the state supreme court. There is a case on appeal in Kansas right now challenging the constitutionality of a portion of their statute as well. It is worth noting that the basis for these constitutional challenges exists in many other states.

Last year, a judge in Alabama declared the state’s entire workers’ compensation statutes unconstitutional. This was appealed, and the case settled on appeal, so that decision ultimately was rendered moot. However, the issues raised in that court case regarding benefit adequacy are something we could see again anywhere.

Multiple brokers have indicated that the workers’ compensation rate outlook for 2018 is relatively flat. But with workers’ compensation being such a long-tail business, premiums collected today must cover losses 30 years into the future. As losses continue to climb, it is inevitable that insurance rates will need to increase in the future to offset those losses.