MTA—MTA Will Pay Consultant $13 Million In Bid to Limit Workers’ Comp Costs

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The Metropolitan Transportation Authority, seeking to cut workers’ compensation costs, has signed a 5-year, $13.8 million contract with DuPont Safety Resources.

The contract for consulting, training and education services comes as a response to estimates that workers’ comp costs will climb 38 percent in the current fiscal year, to $59 million, according to Richard Braumbaug, chief financial officer of the MTA.

The MTA has seen rising workers’ compensation claims for years, but the projected 38 percent jump would be a record. In fiscal 2001, ended June 30, the MTA lost 108,000 days of work from lost-time injuries, up from 96,000 days in fiscal year 2000.

Braumbaug expects the contract to shave $125 million from a potential $300 million-plus in workers’ comp costs over the next five years.

The authority has the dubious distinction of having the highest workers’ compensation costs of any city transit agency in the country, despite being smaller than New York’s Metropolitan Transportation Authority.

Most of the claims are filed by bus operators, who make up the largest workers’ group in the MTA. The 2,258 active buses in the fleet were involved in 3,500 traffic accidents in the last fiscal year, Braumbaug said.

Three years ago the MTA signed with Travelers Group Inc., now part of Citicorp, for workers compensation insurance coverage. With coverage costs climbing, the MTA has gone back to self-insurance. The deal with DuPont is part of an ongoing effort to reduce claims.

Newark, Del.-based DuPont Safety Resources, a unit of E.I. DuPont De Nemours & Co., has spent the last six years working with New York’s transit authority.

“What’s very interesting is the MTA’s lost-time injury rate is at the same level the New York City rate was at five years ago,” Braumbaug said. “Maybe we haven’t focused our attention on that issue like we should have. That’s what brought it to our attention.”

DuPont Safety Resources will be paid on a performance basis, with quarterly reviews, and annual payments will be capped at $2.6 million. The group has sent a handful of consultants to MTA for a 45-day assessment scheduled for completion in mid-November.

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