Adding insult to injury

Wednesday, Dec. 3, 2008 | 2:06 a.m.

One of the standard objections to workplace safety regulations is money. The U.S. Chamber of Commerce, for example, calls the Occupational Safety and Health Administration’s rules “a significant burden” for small businesses and it intimates that any more regulation would end with thousands of companies shutting their doors.

This argument has had great success in Washington for decades, as business groups have been able to fend off regulation in the name of the economy. Over the past eight years, aided by the Bush administration, business has either killed or delayed regulation on ergonomics, personal protection equipment for employees and the industrial chemical hexavalent chromium, a carcinogen best known to America from the Erin Brockovich case.

But the argument is little more than a scare tactic to avoid the cost of preventive safety and health programs. The result is that workers suffer avoidable injuries and illnesses, taking a significant toll on the economy because the bulk of the costs are paid by the public.

Professor J. Paul Leigh, a leading health economist at the University of California, Davis, conservatively estimates that workplace injuries and illnesses tallied $163.3 billion in costs in 2005. (In comparison, cancer was estimated to cost $210 billion.) But only 34 percent of the total cost of injuries is picked up by workers’ compensation insurance.

The remaining $108 billion in costs, Leigh notes, “are then shifted to society.” Injured workers and private insurance companies pay about $70 billion of that with Medicare, Medicaid and Social Security Disability Insurance covering the rest.

The total bill may be significantly higher than estimated. Experts note that the way the Labor Department collects injury and illness numbers, which are used to determine costs, fails to record millions of cases. And chronic injuries and illnesses are rarely, if ever, counted, much less paid for under workers’ compensation programs. For example, a carpenter may need a knee replaced after years of work. Or it may take decades for silicosis to develop in a construction worker exposed to silica dust for years from sandblasting, demolition or concrete work. The public often picks up the tab in those cases.

Economists also note that workplace injuries place a heavy burden on welfare and unemployment programs because injured workers and their families often receive those benefits.

For years advocates have fought for strong health and safety programs by making a moral argument that the cost is outweighed by saving human lives. But experts admit that argument doesn’t work well in the business world, particularly because the cost of a human life under the current law is cheap. A company found to be negligent in a workplace death may be fined a few thousand dollars. And even such fines, as the Las Vegas Sun’s reporting has found, have been routinely negotiated away in Nevada.

“It’s far more effective if you can show employers the savings to their workers’ compensation premiums,” said Joseph Dear, an OSHA administrator during the Clinton administration.

Advocates correctly argue that good safety programs can save companies many times what they cost — from lower workers’ compensation and health care insurance premiums to higher worker productivity.

With American employers paying $88 billion in workers’ compensation premiums every year, business groups should be encouraging good safety programs, which in turn help employees, companies’ bottom lines and the economy.

Congress should also make this a priority. Taxpayers would be much better served if federal dollars weren’t going toward workplace injuries and illnesses that could have been prevented. Safety regulation and oversight have a great payoff, for all of us.