In the October 1st edition of the Vancouver Business Journal, we told you why we believe Initiative 1082 would be good for business.
I-1082 would allow companies to purchase Industrial Insurance (workers’ compensation) from private insurers rather than continuing with the state run monopoly.
Recently, Lieutenant Governor Brad Owen weighed in on the issue. The following is a look at what he had to say.
I-1082 – A win for business
By Brad Owen, Lieutenant Governor
During my 34 years serving the public in various capacities, I’ve heard a lot of complaints about a lot of things from unhappy taxpayers. As a public official, I know you can’t make all the people happy all of the time and fielding the vast array of complaints is an occupational hazard.
But there is one complaint I hear more than any other, and it has to do with the state Department of Labor & Industries’ (L&I) management of the state workers’ compensation system. People complain about the inefficiency in claims processing. They complain about the high costs. They complain the agency is unresponsive. The list goes on.
What really frustrates the people who complain about L&I is the fact that they can’t do anything about it. They can’t express their dissatisfaction by taking their business elsewhere because L&I holds a monopoly on workers’ compensation in this state.
In a nutshell, they feel powerless. And the truth is they are powerless. That’s why I hope voters will approve Initiative 1082.
I-1082 will simply end L&I’s monopoly and allow private insurers to sell workers’ comp coverage to businesses. This means people will no longer be powerless to do anything about their dissatisfaction with the state agency. L&I will have to compete with private insurers in order to stay in business – that means handling claims efficiently, keeping costs under control and making sure customers are happy.
I know a thing or two about keeping customers happy. Before my life in politics I owned a small business. If I didn’t keep my customers happy they would simply go to my competitors. I don’t need to explain the motivation that provides.
I’ve believed L&I’s lack of competition has been a problem for a long time. In my early days as a legislator, I supported legislation to allow competition in the workers’ comp marketplace. My firsthand experience in small business, combined with a laundry list of complaints registered by my constituents, convinced me that business owners and workers would benefit if L&I faced competition from private insurers. The bill didn’t pass, but after all these years I still believe it’s a good idea whose time (I hope) has finally come.
If I-1082 passes, L&I will, for the first time in its 100 year history, be forced to compete. However, despite its many flaws the initiative doesn’t do away with the state agency. Businesses satisfied with the current system can keep their workers’ comp insurance with the state. But those unhappy with L&I can shop for better prices and better service.
The special interests opposing I-1082 think this choice is a bad idea. They argue the private insurance companies from which we all purchase our health, home, life and automobile coverage are not trustworthy enough to sell workers’ comp coverage. The opponents of I-1082 expect voters to believe companies that sell these other lines of insurance will somehow be catastrophic for workers’ comp just because they are profit-motivated. It simply defies logic.
Are private, for-profit insurance companies perfect? Not by any means. Are they a better option than our current government monopoly? You bet.
If you are unhappy with your private insurer, you can give your business to another insurer. You have a choice. If you are unhappy with L&I, you have no choice. That’s why I’ve received more complaints about L&I than any other state agency.
In addition, being motivated by profit is not the evil thing opponents of the initiative make it out to be. A private insurance company that relies on profit to stay in business simply has a bottom line to meet. If they don’t control costs, operate efficiently and meet that bottom line, they’re out of business. And let us not forget, private insurance companies must also provide good service and keep prices competitively low. If they don’t, they lose their customers.
Our current “non-profit” state-run monopoly system means L&I has no such fears. L&I can’t go out of business. The agency doesn’t have to worry about losing customers or running out of money. When L&I needs more money, they can just increase taxes on their “customers.” And that is exactly what the agency has done, and will continue to do if we don’t pass I-1082.
In these lean times, we can’t afford to continue to prop up a failing government monopoly with increasingly scarce taxpayer dollars. Voting yes on I-1082 will give the private sector the opportunity to do better what government has been doing inefficiently for almost a century. It’s about time.
You can contact Lieutenant Governor Brad Owen at ltgov@leg.wa.gov
