Tackling Workers’ Compensation in New York

April 8, 2016
Tom Precious, Blood-Horse

Thoroughbred owners and trainers in New York are negotiating with a number of insurance underwriters and looking to start their own risk control system they hope will lower the rising costs of workers compensation insurance for jockeys, apprentice jockeys, and exercise riders.

The ongoing work comes as a new state budget in New York approved the release of up to $2 million this year from what’s known as a “purse cushion” to help pay the costs associated with the Jockeys Injury Compensation Fund. State officials say the budget agreement is what the horsemen asked the state Gaming Commission in December to do, but there was no authority in state law to permit the request. The budget deal now allows the funds transfer.

The funding though, according to the head of the horsemen’s group at New York Racing Association tracks, is only a stop-gap measure that does not control the actual costs of the insurance program.

“There’s no question it’s bad for business,” Rick Violette Jr., president of the New York Thoroughbred Horsemen’s Association, said of the insurance expenses. “There’s no question people have second thoughts about racing in New York because of the huge costs.”

A 2016 workers compensation program, which is run through a state government insurance fund, was approved in December by the state Gaming Commission.

There are essentially three components to what owners and trainers pay into the insurance program, including trainer payments of $1.50 per stall per day and 2% taken off the top of purses. The third piece, until the recent state budget deal, called for all owners and trainers to pay $3,000 annually.

The budget, approved April 1, cuts the annual payment to $1,500 by allowing the purse cushion fund—which are monies set aside for purses but not actually paid out—to be tapped for up to $2 million for the insurance costs.

The horsemen’s group also will be asking lawmakers to approve, before the 2016 session in Albany ends in June, a measure to permit it more authority to negotiate directly with private insurance underwriters.

In the meantime, Violette said owners and trainers have hired an insurance firm to run a top-to-bottom analysis of practices on the backside and at racetracks. The goal of this case management exercise is to lower the number of rider injuries.

“They say the best way to lower insurance is to lower frequency and severity of injury. We’re looking at aggressively doing that,” Violette said.

Industry officials are also looking to hire an expert to work at the NYRA tracks and occasionally at Finger Lakes Gaming & Racetrack to monitor morning training hours, help expedite claims, interview riders when they suffer injuries, and also ensure an injured rider does not return to work before they are healthy in order to avoid repeat injuries.

“We’re looking to have boots on the ground … We’re ramping up our risk management,” Violette said.

Insurance premiums this year total nearly $9 million, according to Violette, with the workers compensation program in the past five years going from 13% of payroll costs for jockeys and exercise riders to 22% today. “The costs have gone up, as have the number of accidents. Exercise riders are responsible for a big portion of this.”

Besides looking at ways to reduce injuries, the group is looking to strike coverage deals with either private carriers or possibly starting a self-insurance system.

2016-04-13T15:54:10+00:00 April 8th, 2016|Categories: Legislative|
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