Legislative Victory: $100 Million+ Saved for Businesses on Workers Comp Proposal

The Colorado Chamber, its members and other business groups secured a major legislative victory for its members behind the scenes as the 2023 legislative session approaches conclusion.

Like much of the chamber’s legislative work, this particular effort occurred before a bill was ever filed. After months of coordination, the sponsors of the bill recently decided to abandon efforts to pass the proposal this year.

The bill in question revolves around the Colorado’s workers compensation program, which provides injured workers with financial assistance when an individual is hurt on the job. Benefits are solely paid by Colorado employers and include medical treatment and vocational rehabilitation, as well as disability benefits which allow for a partial replacement of lost income or earning capacity due to an injury. A worker only needs to prove an injury occurred on the job.

Workers compensation laws vary state-by-state. Colorado’s workers compensation system includes a schedule for injuries that has existed for more than 100 years. The most recent comprehensive change to Colorado’s workers compensation system occurred in 2017, which was directed by statute and led by a working group comprised of representatives of injured workers and employers. That effort resulted in changes to the system that supported the needs of injured workers.

At the beginning of the 2023 session, the Colorado Chamber became aware of an effort to overhaul major tenets of the state’s worker’s compensation system. Working closely with chamber members who are providers of workers compensation insurance as well as several industry members directly impacted by changes in the workers compensation system, the chamber’s government affairs team entered into months of negotiations to ensure that any bill that was filed would balance the needs of workers and the business community.

Unfortunately, there were several issues in the collaboration process that impeded the ability to reach consensus. An early draft of the bill would have drastically changed Colorado’s workers compensation system, resulting in significant costs to both public and private sector employers. The Colorado Chamber raised concerns that if passed, the bill would have made Colorado an outlier compared to other states, making our overall business climate less competitive. In short, the bill would have:

  1. Changed the weekly compensation calculation for injuries including adding an age factor;
  2. Reduced the applicability of the schedule of injuries;
  3. Treated less serious injuries same as more serious injuries with a flat cap for any combination of benefits.

This sweeping proposal would have impacted thousands of private employers, especially the restaurant and construction industries, in addition to public employers like cities, counties and school districts. The proposed changes to the workers compensation system would have resulted in four times the current workers compensation premium costs for public sector employers, according to the Colorado Self Insured Association. And for all public and private employers, estimates by the National Council on Compensation Insurance were projected to be a minimum of $131 million to $144 million in premium increases.

After raising these cost concerns to the bill sponsors over the last several months, Rep. Andrew Boesenecker recently announced his intention to decline filing the bill this year. This is a major victory for the Colorado business community, which is already facing financial and regulatory hardship due to current economic conditions.

“Even though states adjust work comp benefits differently, Colorado would have been an outlier from the rest of the country and especially among neighboring states,” Colorado Chamber of Commerce President and CEO Loren Furman told The Sum & Substance. “As we see Colorado’s business climate decline, legislation such as this would have further contributed to our drop in competitiveness nationally.”

For further reading on this topic, see coverage from the Colorado Chamber’s exclusive digital news publication, The Sum & Substance.