Copyright (c) 1994 Arkansas Law Review and Bar Association Journal, Inc.
Arkansas Law Review
The New Arkansas Workers' Compensation Act: Did the Pendulum Swing Too Far?
47 Ark. L. Rev. 1
John D. Copeland *
The 1990's began with the Arkansas Workers' Compensation system in serious trouble. The premiums paid by employers for workers' compensation insurance had risen to prohibitive levels. In 1992 the Arkansas Insurance Department granted insurers an 18.5% rate increase, and between 1987 and 1992 workers' compensation rates increased 72.3 %. 1 According to the National Council for Compensation Insurance, in policy year 1990 Arkansas ranked as the fifth worst state in workers' compensation costs as insurance companies paid out $ 1.42 in costs and claims for every $ 1.00 in premiums collected from Arkansas employers. 2 The dramatic increase in insurance premiums was attributed to increased incidents of fraudulent claims, increasing medical costs, 3 and the continual expansion of the Arkansas Workers' Compensation Law by administrative judges, the Workers' Compensation Commission, and the Arkansas courts. 4
In response to what was viewed by many employers and insurance carriers as a crisis, an ad hoc committee was formed by the 79th Arkansas General Assembly prior to the 1993 legislative session to reform the Arkansas Workers' Compensation Law. 5 The committee was composed of the Insurance Commissioner, Lee Douglas, and representa tives for employers, labor, the insurance industry, injured employees, and the legal community. 6
The result of the committee's efforts, after much input from the Arkansas legislature, was HB 1615, which was passed by the legislature as Act 796 and signed into law byGovernor Jim Guy Tucker on March 31, 1993. Act 796states that it is an act to increase workers' ...
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