Montana lawmakers discuss workers' compensation reform amid fiscal implications

In a recent meeting of the Montana Senate Finance and Claims Committee, discussions centered on proposed changes to the state's workers' compensation system, highlighting the financial implications for both injured workers and employers. The meeting, held on March 19, 2025, featured a range of perspectives on a bill aimed at adjusting benefit structures for injured workers.

The primary focus of the discussion was the fiscal note associated with the proposed legislation, which estimates an increase in benefit payouts of approximately $10 million over the next four years. Proponents of the bill, including representatives from labor unions, argued that the current system disproportionately affects high-wage earners who are capped at receiving only two-thirds of their wages when injured. They emphasized that the proposed changes are necessary to ensure that injured workers receive adequate support during their recovery, thereby promoting a healthier workforce.

Senator Flowers, a key proponent of the bill, articulated the need for reform by pointing out that the existing workers' compensation framework often fails to prioritize the well-being of injured workers. He argued that the system should focus on rehabilitation and support rather than merely preventing abuse. This sentiment was echoed by Jake Brown from the Montana AFL-CIO, who cautioned against using workers' compensation as a tool to pressure employees back to work prematurely, which could lead to higher rates of reinjury.

However, the meeting also saw significant opposition from representatives of self-insured employers and small business associations. Critics, including Peter Strauss of the Montana Self Insurers Association, raised concerns about the projected cost increases associated with the bill. They argued that the proposed changes could lead to higher premiums for employers, which would ultimately be passed on to employees and consumers. Rhonda Wiggers from the National Federation of Independent Business highlighted that the increased payouts would not come from the state but would instead burden small business owners with higher insurance costs.

The committee also engaged in a detailed discussion about the potential impact of the proposed changes on insurance premiums, with estimates suggesting a possible increase of 6.5% to 7.7% in costs for employers. This raised questions about the sustainability of the workers' compensation system and its ability to provide adequate coverage without imposing excessive financial strain on businesses.

As the meeting concluded, the committee members were left to weigh the competing interests of supporting injured workers while ensuring that the financial implications for employers do not hinder economic growth. The discussions underscored the ongoing challenge of balancing the needs of workers with the realities of business operations in Montana. The committee is expected to continue deliberating on the bill, with further discussions anticipated in the coming weeks.