In the Pocket of Big Business, Iowa Governor Signs Workers Compensation Reform Law

Workers Compensation
Proposed Legislation in Iowa

By Lynn Shapiro, Staff Writer

Iowa business interests are insisting the state is facing a workers’ compensation crisis, benefiting opportunistic attorneys and their pariah clients. 

But the numbers don't support these arguments, according to a Des Moines Register analysis of workers' compensation data.

Records from the National Council on Compensation Insurance, which sets workers' compensation insurance premiums for Iowa and other states, show no spike in premium costs, claims or medical expenses associated with workplace injuries, The Des Moines Register reports.

In fact, Iowa’s workers' compensation premiums dropped by 4.7 percent last year.

Also, just 713 workers compensation cases in 2016 received decisions from state courts, less than half of the 1,724 cases that wound their way through Iowa's courts in the year 2000, The Register reports.

However, this favorable data didn’t stop long-time Iowa Governor Terry Branstad from signing a workers’ compensation reform bill that would stiffen eligibility requirements for injured workers.

The anti-consumer legislation was approved by a 55-38 margin in the House and a 29-21 Senate win.

“In the past 10 years, Iowa’s workers’ compensation system has mutated into a system benefiting trial lawyers at the expense of Iowa businesses and Iowa workers,” Governor Branstad said in a statement

Most Pernicious Provision Pulled

The most pernicious provision in the law was killed after it came under fire. It would have ended numerous worker benefits at age 67.

Current provisions include:

  • minimizing late fees for companies that don’t pay fines on time
  • slashing benefits for injuries resulting from pre-­existing conditions
  • preventing attorneys from taking fees from injured workers when the employer is voluntarily giving benefits
  • ending individuals’ right to receive workers’ compensation while receiving unemployment insurance
  • targeting intoxication as a reason for non-payment.

The Last Thing Workers Need

An attorney who spoke to on the condition of anonymity says,

“Companies don’t pay adequate amounts of money to workers to begin with, so compensation ‘reform’ is the last thing workers need.

“If the costs of insuring safety in the workplace exceed the benefits employers derive from doing the right thing, firms would have no incentive to proactively correct workplace-related problems,” the attorney says.

“Therefore, the tort claim process should be available to injured parties so they get fair compensation for their injuries.

Flammable Ford Pinto Fiasco

“Take the infamous Fort Pinto case, cited in every business school textbook.

“Ford calculated the estimated the value of a life at $250,000.

“Then they surveyed the number of Pinto’s on the road.

They calculated the probability of the poorly-designed gas tank being rear-ended, resulting in a punctured gas tank, spewing fuel into the passenger compartment, causing fire, injury and death.

“Ford took this probability value and multiplied it by the number of Pintos on the road, establishing an average number of vehicles that would result in a claim.

“Ford concluded it was cheaper to leave the vehicles on the road and pay victims when the mobile fire traps exploded then to recall them and save lives.”

Third Reich Economics

“I call it Third Reich Economics, since the Nazi’s taught students it was cheaper to euthanize patients than to treat them,” the attorney said.

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