New York Examines Workers' Comp Options for Riders

Rising workers' compensation costs for a jockey injury protection fund in New York could be sharply slowed or even reduced under a series of ideas in intensifying discussions among Thoroughbred interests, insurers, and state regulators.

Joseph Appelbaum, new president of the New York Thoroughbred Horsemen's Association, declined to provide details but said a plan is being worked to address the high insurance expenses. It could include a combination of solutions, including new ways to manage claims, additional safety improvements to reduce workplace accidents, and consideration of different forms of insurance programs, including possibly a first-time use of a self-insurance plan.

The relatively high cost of the New York workers' compensation program for jockeys, apprentice jockeys, and exercise riders—now totaling some $9 million a year—has been blamed for pushing some owners and trainers away from the state.

"It's the number one issue for horsemen in New York. Period. End of statement,'' Appelbaum said of the workers' compensation issue. "We're hoping in 2018 we have some good news to report."

The optimism comes as the New York State Workers' Compensation Board recently issued emergency regulations defining the parameters for how the New York Jockey Injury Compensation Fund would be set up if it goes to a self-insurance system.

The NYTHA has previously estimated that workers' compensation insurance costs have soared from 11% of payroll five years ago to about 25% in 2017.

If self-insurance is selected, the new state rule notes that owners and trainers will be required to pay an annual fee into a self-insurance reserve account; the state believes the "same resources" dedicated to obtaining a commercial insurance carrier's coverage would go into a self-insurance option.

The state workers' compensation board noted that the new emergency rule, if self-insurance is the route, could have an "adverse" impact on owners and trainers but that the regulation's intent is to protect jockeys, apprentice jockeys, and exercise riders by ensuring the insurance fund is financially stable enough to pay injury claims. The rule also sets certain reporting standards, such as annual financial statements showing the fund's ability to pay for a self-insurance program.

Appelbaum said the new emergency regulations adopted by the state are "fairly standard" for workers' compensation self-insurance obligations of other industries. He said the rule's provisions are not prohibitive to efforts by the NYTHA to consider self-insurance options.

New York State earlier this year adopted a new law that permits the jockey injury insurance fund to negotiate directly with insurance companies for coverage of jockeys, apprentice jockeys, exercise riders and—for the first time—potentially all backstretch workers in a new blanket-type policy.

The legislation approved in April affects insurance programs at New York Racing Association tracks as well as Finger Lakes racetrack in upstate.

Any change in the insurance structure would require approval from industry players, such as the NYTHA, as well as the state gaming commission. "We are looking at solutions to bring down the costs,'' Appelbaum said. Being examined is a range of options, including such things as guaranteed costs and high-deductible plans.

Appelbaum said work is still underway on the issue and could not provide a timetable for a final deal on the matter. "We wouldn't want to head into it without understanding all the parameters and consequences,'' he said.