Colorado legislation, business owners, and workers were outraged when they heard that Pinnacol Assurance, the state-chartered company for workers’ compensation insurance spent millions of dollars trying to privatize itself. Pinnacol Assurance has kept the privatization under wraps from the public eye, since they were spending millions of dollars on other things instead of workers’ compensation benefits to promote privatization. If Pinnacol succeeds in privatizing Colorado’s workers’ compensation insurance, business owners and injured workers will ultimately suffer in the long run.
There was a recent request for Pinnacol Assurance to make their records open to the public for attorneys, employers, and lawmakers to see where they were spending the money that was supposed to be paid out to workers’ compensation benefits. The request revealed that Pinnacol spent over $1.6 million in advertising, lobbying, and PR services to help privatize their company. Colorado business owners are floored at the amount of time and money Pinnacol spent to privatize itself without making a public statement or informing Stakeholders of their decision.
Pinnacol Assurance is using employer-paid workers’ compensation payments to get the ball rolling so they can implement their privatization proposal. Many people believe that the state-chartered workers’ compensation insurance company is already privatized, and they have nothing to show for it. Not only did Pinnacol spend $1.6 million in advertising, public relations, and marketing to privatize their company, but they spent a total of $3.5 million since September 2011 in consulting, financial, and legal services. They were spending all this money right underneath everyone’s noses.
Colorado residents believe that Pinnacol is spending their money foolishly, especially when the money should go toward paying hospital and medical bills, as well as lost wages for employees suffering from work-related injuries. The workers’ compensation insurance company hit the ground running to help privatize their company before they decided on selling the idea to policyholders and state legislature. It seems that Pinnacol was planning on fully privatizing before telling the public by using benefit monies that could have paid injured workers wages and hospital bills. Only after privatizing their company would they sell the idea to stakeholders and policymakers about their decision.
Pinnacol did not do its due diligence in informing key stakeholders and government officials when they decided to privatize their company. They believed they were protecting policyholders by spending millions of dollars in legal, financial, advertising, and marketing fees. Privatizing a large company is a complicated and complex process, so Pinnacol believed they were protecting everyone’s best interests by hiring multiple consulting companies during the privatization process.
If and when Pinnacol privatizes itself, policyholders can expect to see an increase in monthly premiums when paying for workers’ compensation benefits to their employees. Small businesses will have a difficult time paying higher premiums, which puts their company and employees workers’ compensation coverage at risk. Most of the policyholders are also against privatizing the state-chartered workers’ compensation insurance company because the state would own at least 40 percent of the company.
The workers’ compensation company is also looking for backing from labor employees, which they would create a $22 million injured employee fund that is further broken down into roughly $1.1 million spent over two decades. Laborers will not benefit by this fund because one injured person alone could rack up $1 million in hospital and medical bills from their work-related injury. Then what are the other injured workers supposed to do?
Pinnacol is only looking out for their best interests and bottom line, not business owners, stakeholders, and injured workers. They can pay out millions of dividends every year to help fund local college scholarships and development projects, but it does not help the workers. They can make the privatization proposal look as pretty as they want, but when it comes down to brass tacks, injured workers care is at stake in the end.
Are you concerned with how you will receive benefits as an injured worker in the state of Colorado or how the Pinnacol privatization could affect your workers’ compensation case? Contact us today to see how we can help assure you get the benefits you deserve.