News  AG Announces New Compliance Program to Ensure Fairness in Workers’ Compensation

Boston — Attorney General Maura Healey announced today a new audit compliance pilot program to protect workers and fight fraud in workers’ compensation insurance.

The new program, approved today by the Commissioner of Insurance, will help ensure that workers’ compensation insurers can examine and audit the information needed to set premiums for employers, while also ensuring that employers are given fair opportunity to provide records without any undue burden. 

“We hope that this new pilot program will protect workers, lower premiums, and allow businesses to invest in higher wages and growth,” said AG Healey. “This is about ensuring that workers in our state are treated fairly and provided the coverage they need.”

This pilot program was created as a follow up to a workers’ compensation rate settlement with the State Rating Bureau (SRB) and the Workers’ Compensation Rating and Inspection Bureau (WCRIB) that resulted in $150 million in savings to employers.

Workers’ compensation insurance audits are used to determine whether employers are paying the correct workers’ compensation insurance premiums based on a review of payroll information. Audits can result in corrected premiums for employers and ensure that all employees are properly accounted for and provided with insurance coverage. Employers that fail to cooperate with audits may be subject to penalties.

The program will operate as a two-year pilot program. During the pilot period, the Attorney General’s Office will carefully monitor the implementation of the program to ensure there are no insurer abuses in the system. Any policyholder that believes it has been treated unfairly in the audit process or did not receive appropriate notices should contact the Attorney General’s Insurance Hotline at 888-830-6277. 

Workers’ compensation rates are set periodically in administrative rate hearings before the Division of Insurance. The insurance industry is required by statute to undergo an administrative review at least every two years. Structures for audits and other requirements that apply to policyholders are also reviewed by the Commissioner and may be challenged by the Attorney General.

The AG’s Insurance and Financial Services Division represents the public interest in administrative insurance rate trials, and advocates for fair rates and fair practices for insurance customers. Over the past 10 years, the AG’s Office has saved employers and small businesses approximately half a billion dollars by intervening in workers’ compensation insurance administrative rate cases.

The Attorney General’s Office worked collaboratively with the Insurance Commissioner’s State Rating Bureau on this matter. This matter was handled by Diana Hooley, Peter Leight, Dr. Burt Feinberg, Lilia DuBois and Glenn Kaplan of the Attorney General’s Insurance and Financial Services Division.