Let me get straight to the point. For Maine’s next governor, one of the most critical economic issues will concern workers’ compensation insurance. I put workers’ comp at the top of the list because it affects everything else – from business start-ups to job creation to the wages of Maine workers.

Granted, this is a complex issue, but the bottom line is clear: If our economy is to thrive and create an ample supply of good jobs, we need a workers’ comp system running on a solid and predictable footing. We’ve had stability in the system for the past seven or eight years, but trouble is now brewing just below the surface.

If you were living in Maine in 1991, you remember the workers’ comp crisis that forced a state government shutdown. Workers’ comp rates had increased out of control, yet insurance companies were losing huge sums of money.

Chaos ruled the day. Overall, workers’ comp in Maine was the most expensive system in the country, with costs driven by an adversarial process that pitted workers against businesses, to no one’s benefit.

When the last of the insurance carriers pulled out of Maine, there was no choice but to take action. After all, Maine law requires employers to carry workers’ comp coverage, but there was no coverage available. A blue ribbon commission designed a new system, intended to be affordable and sustainable, while being fair to employers and employees alike.

After these landmark reforms kicked in, the situation steadied. Insurers returned to the Maine market. Safety in the workplace improved dramatically. Timely benefits flowed to employees injured on the job. And premiums fell from a collective $253 million in 1992 to a low of $126 million in 1998.

That savings of $127 million in 1998 meant that Maine businesses could create new jobs, increase wages and enhance benefit packages. The reforms worked.

Despite these improvements, we’re not out of the woods yet. Safety in the workplace has slipped. Premiums are once again on the rise – in 2000, they reached a collective $173 million, up 35 percent in two years. Medical costs, left uncontrolled in the 1992 reforms, are escalating, and administrative expenses also are climbing sharply.

There’s no mystery behind these reversals. When the reform law passed in 1992, it set new benefit levels for “permanent partial” injuries. Benefit limits were fixed at five years for those with less than 15 percent of whole-body impairment. For those whose impairment exceeded 15 percent, the benefits were guaranteed for a lifetime. These provisions minimized litigation, which had previously imposed punishing costs throughout the system.

However, the law also provided for increasing those benefits, based on certain conditions and certain triggering mechanisms. We’ve now tripped those triggers. Today the initial 15-percent threshold for lifetime benefits has been reduced to 11.8 percent. In other words, more people are eligible for them.

Meanwhile, the time limit for partial impairment has jumped from five years to seven, and might even go to eight years. These changes are applied retroactive, and they’ve generated significant new cost increases.

As if all this weren’t bad enough, certain legislators in Augusta have been actively attacking the 1992 reforms. More than 20 bills were submitted in the legislature’s last session that would have greatly undermined the hard-won victories of a decade ago. Two of them passed the House but were stopped by the Senate. Another passed both bodies but was vetoed by Gov. King. Indeed, during his two terms in office, the governor has vetoed more than a dozen similar pieces of legislation. Most of them were anti-business, anti-strong economy, and anti-jobs.

Here’s a point to keep in mind. When workers’ comp costs escalate rapidly, employers have to cut back elsewhere. What are their choices? Wages decrease, medical coverage shrinks, matching contributions to 401(k) plans are reduced, and maybe jobs are eliminated. This is a no-win situation for all of us.

The next governor must be actively focused on workers’ comp. Safety in the workplace must remain everyone’s highest priority. Attacks on the system intended to bring back high costs and conflict must be fought, and vetoed if necessary. Going forward, the recent surge in premiums must be checked and brought back into line with national cost levels. And finally, new comp reforms must carefully balance the interests of workers, employers, insurers and the state’s economic future.

Let me leave you with one message. If workers’ comp isn’t working, Maine’s economy isn’t working either. As your next governor, I pledge to keep comp working, so everyone in Maine can reach a higher level of prosperity for themselves and their families. We deserve nothing less.

Peter Cianchette is a Republican candidate for governor.