Maine workers’ comp story worth emphasizing

Your editorial in last Monday’s paper was right on the mark regarding a fraud case with Maine Employer’s Mutual Insurance Co. (MEMIC), which costs Maine employers between $12 million and $20 million each year. However, I’d like to take a moment to praise MEMIC for far more than merely catching Workers’ Compensation cheats and tell the rest of the story.

Under great threats to Maine’s employers from the pending departure of Workers’ Compensation Insurance Carriers from Maine in the early ’90s, a blue ribbon panel was called together by Gov. John McKernan and the Maine Legislature to see if a solution could be found. One of the recommendations included the creation of a state-sponsored, yet privately managed insurance company. Thanks to the hard work of civic-minded citizens like Helen Dudman of Ellsworth and Harvey Picker of Camden, such an insurance company was formed. However, the Legislature could provide little money for the startup and very special rules were put in place to allow MEMIC to generate capital from its insured employers. All this was monitored closely by then Insurance Commissioner Joe Edwards.

I was honored to have been selected to serve on the fledgling board of directors in 1992 along with a great group of fellow Maine employers, with little more than a dream and best wishes from the state of Maine.

As in most successful undertakings, we enjoyed great good fortune. Perhaps MEMIC’s best decision was to employ John Leonard as CEO. Somehow, Maine was able to attract a great chief executive providing 30 years experience with the Travelers Insurance of Hartford. Immediately John set about assembling an incredible team that would enable MEMIC to serve not only the interests of Maine’s struggling employers, but also our hard-working employees.

Included on that team was a man who moved to Portland from the County, Dan Cote, who would bring Maine’s generally small business owners, oftentimes kicking and screaming, into the 21st century.

Prior to MEMIC, most employers didn’t pay much attention to injured workers – not really. For the most part, employers would rush an injured worker off to the emergency room, fill out a minimum of paperwork, and tell their insurance carrier to “Let me know when John Doe can return to work.” Not so under the new regime. Leonard, Cote and the entire MEMIC team changed all that.

Under the “new” rules a trained inspector from MEMIC would show up for an inspection regularly. They’d point out any violations of workplace safety and demand changes. Injured workers would be brought back into the workplace in a light-duty status if able. Training was the order of the day. The ability of an employer to obtain Workers’ comp insurance was on the line – as was their ability to remain in business.

Between 1992 and 1998, based on all parties’ hard work, employers and workers alike, Maine’s cost of workers’ comp insurance was reduced by 50 percent. Even more importantly, Maine’s injury rate was reduced by 40 percent. (I must point out here that other blue ribbon panel recommendations were passed in 1992 and all impacted these numbers. However, there’s little question that the arrival of MEMIC on the workers’ comp scene played a material role in these improvements.)

Since I left the board of directors in 1998, MEMIC has continued to expand its role as “a private company with a public purpose,” stated John Leonard. MEMIC returned nearly $50 million of the capital it collected in the early years back to Maine employers ahead of schedule. MEMIC has consistently supported a strong Worker Advocate Program to represent injured Maine workers. The A. M. Best rating company gave MEMIC high marks for being tops in on-time benefit payments to injured workers. Additionally, MEMIC has recently created the Horizon Scholarship Program for the benefit of children and spouses of seriously hurt workers. Certainly not your average Big Corporation From Away – merely taking and not returning.

Your editorial was accurate in highlighting one component of a competent institution, minimizing fraud and abuse while keeping workers’ comp insurance costs as low as possible for Maine employers. Additionally, MEMIC offers Mainers a heart and a soul through its support for the interests of Maine workers and their dependents. As a member of the Legislature’s Labor Committee, I’m pleased to work with such a fine institution, Maine Employer’s Mutual Insurance Co. May their second decade of service to the state of Maine continue as fruitfully as their first decade.

W. Tom Sawyer, of Bangor Jr. is a state senator from Senate District 9.