Texas. Legislature. Joint Select Committee on Workers' Compensation Insurance

The Texas Legislature created the Joint Select Committee on Workers' Compensation Insurance (House Concurrent Resolution 27, 70th Legislature, 2nd Called Session, 1987) because the state workers' compensation system was poorly understood and perceived to be out of control. Problems with the workers' compensation system in Texas had been evident for 50 years, first detailed in a 1938 report submitted to Governor Allred and periodically the subject of a variety of legislative investigative committees. By the late 1980s, workers' compensation rates had increased over 67% in 30 months, costing $2.3 billion in premium costs and $600 million in medical costs per year, and additional increases had already been approved by the State Board of Insurance. Both large and small businesses claimed that the rates were causing undue hardship but, simultaneously, labor interests argued that the Texas rates were among the lowest in the nation. The committee, therefore, was intended to conduct a detailed study of the workers' compensation system in Texas, the impact of the system on employees and employers, and how other states addressed the problems facing Texas.

Specifically, the Committee was to gather information relating to the procedure for the payment of claims; determine the actual impact of the workers' compensation system on economic development and job creation; study the efficiency of the current system of workers' compensation benefits to the injured; study the operation and organization of the Industrial Accident Board; probe the means by which employers indemnified themselves against claims; perform a general study of job safety and the means by which to improve it; investigate the workers' compensation assigned risk pool and its efficiency; and study the manner in which other jurisdictions addressed the same problems. The Committee was composed of five House and five Senate members, led by co-chairs Representative Richard Smith and Senator Bob Glasgow, and could request assistance from a variety of state agencies. Additionally, it could appoint an Advisory Panel on Workers' Compensation Reform, to be composed of six individuals who would review information, make recommendations, conduct research, and make reports to the Committee, as requested.

In order to fulfil its mandate, the Committee conducted nine public meetings to receive testimony and information from state officials, invited experts, the principle workers' compensation interest group representatives, the public, and committee staff and consultants. Expert and public testimony was taken at four of these meetings, held in Austin, Houston, Lubbock, and Arlington between January and June of 1988, and additional expert testimony was taken at two additional meetings in July. The main body of the Committee's research was released in the Research Papers of the Joint Select Committee on Workers' Compensation Insurance in September 1988.

The Committee's final report was submitted to the 71st Legislature on January 10, 1989. According to the report, the Committee and its consultants recommended changes in the responsibilities, sizes, and functions of the agencies and bodies responsible for workers' compensation issues; adjustments in benefits and in the means of determining benefits; changes in the methods of dispute adjudication; an increase in the promotion of job safety issues; and modifications to insurance company and coverage requirements and minor miscellaneous issues.

As a result of the recommendations, the Texas Industrial Accident Board became the Texas Workers Compensation Commission, effective April 1, 1990, and the Texas Workers' Compensation Research Center was created to advise the new commission and conduct professional studies on benefits delivery, cost and quality of medical benefits, drugs in the workplace, insurance policies and rates, rehabilitation and re-employment of injured workers, workers' litigation, workplace health and safety, and other workers' compensation related topics. At the same time, the Legislative Oversight Committee on Workers' Compensation Insurance was also created. Finally, in 1995, the Legislature amended the Workers' Compensation Act to create the Research and Oversight Council on Workers' Compensation (House Bill 1091, 74th Legislature, Regular Session, 1995), commonly referred to as the ROC. The new council, merging the functions of the Texas Workers' Compensation Research Center and the Legislative Oversight Committee on Workers' Compensation Insurance, was to serve as an advisory body to the Texas Workers' Compensation Commission and conduct studies of the Texas Workers' Compensation Insurance Fund.