W. Va. Lawmakers Ignore Warnings in Seeking Workers’ Comp Oversight

West Virginia’s insurance commissioner still objects, but lawmakers continue to pursue some role overseeing the privatization of the workers’ compensation system.

A joint Judiciary Committee panel recently voted to advance a bill to require the commissioner to inform the Legislature of all proposed changes to the rules, policies and guidelines governing this type of insurance.

The state had run the program, which provides benefits after workplace-related injuries and illnesses. A private company created by the Legislature in 2005, BrickStreet Insurance Co., now handles such claims. Other insurers can start competing with BrickStreet on July 1.

By a less than unanimous vote, the subcommittee advanced the bill after warnings from Commissioner Jane Cline. “I think the concern is, that every decision we make is going to be second-guessed and challenged by the Legislature,” Cline said. “Is the regulator going to be the insurance commissioner, or is the regulator going to be the Legislature?”

Gov. Joe Manchin, Cline’s boss, has threatened to veto any such bill.

Cline said several of the associations representing insurers have raised concerns about the oversight, saying it would have “a chilling effect.”

That was enough for such critics of the oversight proposal as Senate Minority Leader Don Caruth. “We haven’t even opened the market to private investors yet, and we’re taking a step that takes our workers’ compensation system back to a state-run system,” said Caruth, R-Mercer, who helped craft the privatization plan.

But House Judiciary Chairwoman Carrie Webster said advocates of oversight remain committed to privatizing the system. They instead recognize that the rules for all other lines of insurance must pass legislative approval but that workers’ compensation has long been exempt from that requirement.

Webster said the move has been spurred by a series of proposed or actual policy changes, by either Cline’s office or Brickstreet, that she says violated state law or established practice.

“In my view, this is purely a separation of powers issues,” said Webster, to the grumbling of several insurance lobbyists in the back of the committee room. “This is simply an informational exchange.”

Cline cited the e-mails her office routinely sends to interested parties announcing all proposed changes. Numerous lawmakers have signed up in recent months, she said.

Cline also said the bill would require her to report on proposed policy changes, which are sometimes fluid and which she has not had to do for other lines of insurance.