CHARLESTON – With a late lift from the Supreme Court of Appeals, West Virginia soared into a new age of competition in workers' compensation insurance on July 1.
The Justices eased the transition to a free market in May with an opinion that cleaned up an old mess without creating a new one.
They struck down a rule that deactivated injury claims after six months, but they did not intrude on internal claims practices of insurers.
Insurance Commissioner Jane Cline, who didn't like the old rule anyway, already has written a new one.
The Court's opinion anticipated Cline's cooperation and praised her for explaining how deactivation of dormant files increases efficiency and reduces costs.
Justice Joseph Albright described her brief as stellar and wrote that it "provided greatly appreciated assistance to this Court in scrutiny of this matter."
Rebecca Roush and Dan Crydock, staff attorneys for Cline, wrote the brief.
Roush said in a July 9 interview that controversy over the six month deactivation rule was unexpected and monumental.
"The Court's decision was overall positive, definitely for those insurers coming into the state," she said. "It doesn't impede their ability to choose file management practices.
"There is no harm to the industry or to the claimants."
From 1913 to 2005, West Virginia insured workers through a public monopoly.
On Jan. 1, 2006, the former Workers' Compensation Commission expired.
All workers' compensation coverage passed to BrickStreet Mutual, a private company that the West Virginia Legislature authorized.
Legislators granted BrickStreet a monopoly for 30 months, ending this June 30.
Cline said July 9 that the start of competition presented no surprises.
"It's business as usual," she said. "Most of the work has been done up front, prior to July 1."
She said some employers have switched from BrickStreet to new insurers.
"We see that as a positive sign," she said. "We think competition is good for everyone."
She said some national companies have switched to their own national insurers.
She predicted it would take 12 to 18 months to measure movement away from BrickStreet, because policies of different employers will expire on different dates.
She said the most hectic part of the transition has been the close checking of rates and forms that new insurers have submitted.
She said staff must make sure that all policies comply with West Virginia law.
She said staff has also worked hard checking financial conditions of insurers before issuing licenses to them.
She said she hasn't rejected any licenses due to financial conditions.