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Tennessee Employee Injury Benefit Alternative raises safety concerns

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The Tennessee Employee Injury Benefit Alternative triggers questions about how it would affect workplace safety.

To help determine pricing, insurers assign experience modification factors based on an employer's claim history. More claims could result in higher workers comp pricing.

Opting out of the state system could be seen as a way for an unsafe employer to “wash his (experience modification) away,” said Bruce Wood, Washington-based vice president and associate general counsel with the American Insurance Association.

Rather than employers trying to improve workplace safety, they could just opt out and purchase alternative benefit plans, Mr. Wood said.

Exclusive remedy protections don't apply in the Tennessee model, when there's a limited benefit mandate and limited negligence liability.

“That liability exposure requires that employers pay special attention to training, maintenance of equipment and other safe practices in the workplace,” said Bill Minick, president of Dallas-based PartnerSource, a consultant on alternative workers comp plans.

Regardless, all employers still would be subject to rules of the Tennessee Occupational Safety and Health Administration, said Abbie Hudgens, administrator for the Workers' Compensation Division of the Tennessee Department of Labor and Workforce Development in Nashville.