The following guest column by Rick Bender, President of the Washington State Labor Council, appeared in Sunday's edition of The (Tacoma) News Tribune. It was written in response to a previous TNT editorial on thesubject of our public nonprofit workers' compensation system.

A News Tribune editorial (1-29) argued that because of unions’ political threats, the Democratic majority in Olympia is ignoring a “mandate” from business interests to lower workers’ compensation premiums. Unless business-backed reforms that cut injured workers’ benefits are approved, the editorial warns that the Building Industry Association of Washington will push its “drastic alternative” of privatizing the system. The editorial doesn’t mention labor’s motivations for protecting our existing system – except perhaps that we like to bully elected officials for sport – so I thought I’d describe them. They are the injured workers. Those people are mentioned just once in your editorial, when you suggest they are all lining up for the lifetime pensions that the state is handing out as fast as it can. Reality check: Every day in this state people suffer work-related injuries and illnesses. Workers’ compensation is the safety net that pays for their medical treatment. For 75 percent of injured workers, that’s all they get, medical treatment. The remaining injuries are so severe that the worker cannot return to work. For them, the system partially replaces their lost wages until they are considered “employable” again – not at their job of injury, but at any job that pays the federal minimum wage. Of those one-in-four injured workers who receive time-loss benefits, the median number of days they collect is 40 days in Washington’s public system. That compares favorably to the national median of 45 days, according to the National Council on Compensation Insurance. In Washington, 1.5 percent of claims become pensions, where the person is permanently disabled and unable to ever return to work. These aren’t folks faking back injuries. If so, they are committing fraud and should be prosecuted. Permanently disabled people haven’t won Lotto. They can no longer earn a living, and many have significant new expenses related to their medical conditions. But regardless of what they earned when injured, their benefits are capped at 120 percent of the state’s average wage – or about $40,000 annually. Most get substantially less than this maximum. The News Tribune suggests this year’s 7.6 percent average premium increase is evidence of a broken system. In the five years prior to this increase, premiums increased a total of 8 percent. Given health care’s skyrocketing costs, that isn’t bad. To put this year’s 7.6 percent increase in further perspective, it will raise $117 million. Three years ago, our system was so flush that the state approved a six-month “rate holiday” when the medical portion of coverage was free. That saved $315 million. The 2007 rate holiday saved employers more than 2 1/2 times the cost of the 2010 increase. What has changed is a national recession. Our system’s reserves took a $1 billion hit and that forced this year’s increase. Even so, independent assessments still rank Washington’s public workers’ compensation system as being less expensive than most other states.  Washington's workers' comp advantage One of the most persistent myths about our business climate is that our workers' compensation costs are higher than in other states. The gap between the truth and the negative rhetoric on this question is shocking. Not only do we have comparatively low premiums, the system's costs to employers in Washington state are the fifth lowest of any state in the nation. That’s why the idea of inviting private insurance companies to take over our system is so absurd. Our friends at A.I.G., the nation’s largest private workers’ compensation insurer, charge premiums that are significantly higher in other states than ours. A Senate committee just heard testimony that 40 percent of private insurers’ premiums cover profits alone, something our nonprofit system doesn’t require. At last count, 31 private insurers that rushed into California’s privatized market went bankrupt because they were undercharging their rates to gain market share. The state was forced to take on their $7 billion in liabilities, and imposed a new tax on all businesses and sold public bonds to cover the cost. No, our workers’ compensation system isn’t perfect. There are ways to improve it for both employers and injured workers, and the labor movement is eager to work with the business community to accomplish this. But we oppose shredding – or selling – this important safety net for workers. The News Tribune should take a more critical look at the claims of business lobbyists rather than perpetuating the fiction that this is a bad place to do business. All independent assessments from outside of this state – away from our internal corporate echo chamber of negativity – tout Washington as a great place to live, work and operate a business. Let’s keep it that way – on all three counts.

Rick S. Bender is president of the Washington State Labor Council.