NU Online News Service, April 1, 11:17 a.m. EDT
The Florida House of Representatives voted approval yesterday for legislation to restore the attorneys' fee cap in workers' compensation cases that was ruled unenforceable by the State Supreme Court.
The measure (HB 903) clarifies requirements for payment of fees and costs under a retainer agreement and specifies amount of attorneys' fees an injured worker is entitled to recover from an insurance carrier or their employer.
A Senate companion to HB 903 was scheduled to be heard by the Senate Judiciary Committee today.
Replacing hourly fees with a statutory fee schedule for claimants' attorneys was part of the package of workers' compensation reforms passed by the Legislature in 2003.
The schedule was overturned by the Florida Supreme Court in the 2008 Emma Murray v. Mariner Health decision, which found it was unenforceable because the language in the legislation was contradictory.
American Insurance Association said that along with other insurance groups and the business community it had targeted the 2009 legislative session as the first opportunity to restore the fee cap. The trial bar is strongly opposed to the legislation.
Cecil Pearce, AIA vice president of state affairs, said, "We've seen steady improvement in the state's workers' compensation system since the 2003 reforms, but the court's decision threatens to derail our progress and needs to be addressed by the Legislature."
Mr. Pearce said in a statement that "AIA is pleased that the House has taken the first step to get us back on track. The attorney fee cap has played a key role in contributing to the overall reduction in system costs that insurers have experienced. As a result, employers have enjoyed an average decrease in rates of up to 60 percent since 2003."
AIA said that without a legislative fix a rate increase is inevitable, noting that the Office of Insurance Regulation has already approved a 6.4 percent rate increase, effective April 1, reflecting the initial impact of greater attorney involvement in workers' compensation cases.
William Stander, assistant vice president and regional manager of the Property Casualty Insurers Association of America, said, "House members took an important step today in delivering promised savings to Florida employers. Hourly attorneys' fees were the biggest cost drivers in the workers' compensation system. This legislation is critical to restoring Florida's economy."
The National Council on Compensation Insurance (NCCI) estimated that without the cap on attorneys' fees an 18.6 percent comp rate increase will be needed over two years.
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