Is there any bad news in the workers' compensation system these days? Since the passage of the fabled 2003 reforms, employers' rates have been cut by more than half, including a statewide average 18.4 percent decrease that took effect in January. The largest one-year decrease in the state's history will save employers over $700 million and comes as one new company after another enters the market. How is this affecting the market? Case in point, in Tallahassee one workers' compensation insurer is advertising through billboards stationed around the city. And the National Council on Compensation Insurance reports that the number of their member companies has grown from 235 to over 270.

When a market is performing this well, invariably the question is, why? The 2003 reform bill came in at 202 pages and touched on every aspect of the system from injured workers' benefits, to health-care provider reimbursements, medical utilization, construction exemptions, and the litigation system. Insurers in other lines of business have not overlooked the success of those changes. Many of the features in the workers' comp system became part of the blueprint advanced by insurers during last year's failed attempt to reform the state's personal liability protection auto insurance program.

But given the magnitude of the trends that are positively affecting the workers' comp system; it is hard to calculate how any one specific law change has impacted the system's overall cost. This is especially true since the system is so integrated that any modification made in one part of the law reverberates throughout the entire system. Then there is the fact that any effort to measure the performance of the workers' compensation market is a two-way street. Beyond law changes, there are economic trends over which the market has little control, such as changes in wages, the demographics of the workforce, and the performance of the capital markets that affect investment income.