On the first regular workday of 1993 – some 25 years ago – Maine Employers Mutual Insurance Co. mailed its first policies.
Today, in Maine, we provide more than 18,000 Maine employers with workers’ compensation insurance, a contract that provides employees who are injured at work with medical care and replacement of lost wages while shielding their employers from lawsuits. This insurance coverage is an essential underpinning to the economy of our state and the well-being of many of our citizens.
But in 1992, Maine’s workers’ compensation insurance market had all but collapsed under the weight of unsafe workplaces, expensive litigation, and well-intentioned but ineffective governmental meddling in the marketplace. The last insurance company in the state was threatening to leave, along with some businesses.
Faced with dire consequences, then-Gov. John R. McKernan Jr. demanded a solution to fix the system and rescue Maine’s economy. He refused to adopt a state budget until a process for workers’ compensation reform was adopted by the Maine Legislature. After a rancorous 17-day shutdown of state government, a compromise was reached to study the best insurance solutions in the nation, propose a comprehensive legislative overhaul, and then require a vote on a new state statute. The proposed reforms were vigorously supported by the state’s newspapers, especially the Press Herald and Maine Sunday Telegram.
The landmark legislation finally passed in late 1992. It included the formation of our private mutual company, which would prove to be the key to a transformation of Maine’s workplaces and ultimately, a strengthening of the Maine economy. The linchpin of the reform was the alignment of interest for both employers and their employees to cooperate in reversing Maine’s reputation for having the nation’s worst workplace safety record.
The new insurance company would lead a multi-year campaign to train workers to perform jobs safely and to raise awareness about the human and economic cost of injuries. MEMIC’s Partnership for Workplace Safety included first-rate safety training, case management for injured workers and an unrelenting call for changing culture at work. As Tom Moser, a founding member of our employer-governed company, once said, “This should be a safety company that happens to write insurance policies.” And, in many ways, that’s what we are today.
How do we measure 25 years of success?
• Work-related injuries have dropped by 40 percent.
• More than $2.3 billion paid in medical and wage replacement benefits.
• Injured workers get their checks faster.
• Legal wrangling and associated costs are minimized.
• Billions of dollars have been saved as rates for insurance decreased by more than 50 percent.
• MEMIC has returned more than $240 million to policyholders through dividends.
We can never be satisfied, however. Injury prevention requires vigilance and injured workers must always be treated fairly and respectfully, with an eye toward getting them back to work as soon as they are able.
Just last year, MEMIC’s safety team drove the equivalent of a trip to the moon and back, (That’s more than 513,000 miles!) visiting policyholders to further improve safety culture. Since 1993, we have provided tens of thousands of hours in safety training to employers here in Maine.
Today, despite the evolution of work through attention to ergonomics, the advent of more automation and engineered solutions (not to mention the predicted adoption of autonomous vehicles), there remains much work to achieve our vision of workplaces without injuries. To that end, we will continue being a safety company first, and an insurer, second.
As we look ahead both in Maine and nationally, the shared challenge is our health, both at work and in our lives. To work safely and at optimum performance, we all must be fit and prepared to do our work. That means constantly emphasizing the age-old prescription for better health: improving our diets and getting more exercise.
Another reality is that Americans are working longer than ever, and many cannot afford to retire. When injuries occur to older workers, healing takes longer, plus other factors such as hypertension, obesity, diabetes and other chronic conditions interfere with a timely return to work. These are among our greatest challenges.
As we were in 1993, we’re still in this together. The challenges are known, and the solutions are apparent. Together, we can make even greater leaps toward our vision, just as we did in solving Maine’s workers’ compensation crisis. As we mark our 25th anniversary, we are renewing our efforts to reduce injuries and their costs, all while protecting Maine’s valuable workforce.
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