Municipal leaders in the region are bracing for higher insurance costs because of a state law that enables volunteer firefighters to collect benefits if they develop cancer after being exposed to carcinogens at fire scenes.
At least two insurers that specialize in services for municipalities have decided to drop worker's compensation coverage for unpaid firefighters.
Officials in Murrysville and Penn, Hempfield and North Huntingdon townships said they might have no choice but to sign up for coverage through the State Workers' Insurance Fund, or SWIF, at a significant increase from 2012 premiums because of a lack of private-insurer alternatives. The rates might double in Penn Township, Hempfield and Murrysville.
In the case of Penn Township, SWIF quoted an annual price of $64,571, which would be a $34,000 increase to cover five departments. Solicitor Les Mlakar said the price could increase again in 2014, perhaps by as much as 25 percent.
He told township commissioners not to expect help in paying for coverage.
"You're not going to get any funding to support this from any source except your local taxpayers," Mlakar said.
The Firefighter Cancer Prevention Act designates cancer as an occupational disease for paid and volunteer firefighters. A firefighter who serves for at least four years has as long as 11 1/2 years after leaving service to file a claim. That's twice as long as the typical window for a worker's compensation claim.
Benefits may be paid if a firefighter can establish that he or she was exposed to certain carcinogens at fires or incidents involving hazardous materials.
Then-Gov. Ed Rendell vetoed the bill in 2010 because, he said, it would be too costly to municipalities. A revised bill sailed through the General Assembly last year, with Gov. Tom Corbett signing it into law.
State Rep. George Dunbar (R-56) said he anticipated premiums might increase, but, he said, the figures cited by Penn Township "seem awfully excessive." He stood by his vote but said he would try to work with his communities on the cost.
"Anybody who's taking the risk that (firefighters are) taking, we need to make sure that the worker's compensation is fair for what they're giving for free," he said.
PennPRIME Insurance Trust, a service of the Pennsylvania Municipal League, and MRM Trust, which was created by the Allegheny League of Municipalities, are ending their worker's compensation coverage for volunteers. PennPRIME was Penn Township's insurer; Hempfield and North Huntingdon used MRM.
Plum pays $42,000 annually to PennPRIME for worker's compensation insurance for the firefighters in the borough's four volunteer departments.
"I'm concerned about what this (potential higher insurance costs) could do to our budget," Plum manager Michael Thomas said.
Thomas said he is particularly worried about the situation because of the borough's dwindling fire-protection fund.
Plum Council late last year authorized transferring $75,000 from the general fund to subsidize the fire-protection fund this year.
Without the transfer, the fire protection fund would have had an $8,000 balance. In addition to worker's compensation, money in the fire protection fund helps pay for truck purchases, hydrant fees, accident insurance, loan payments, municipal contributions, foreign fire insurance and tires.
Even before the law took effect, the costs for covering volunteer firefighters was "significantly more" than the premiums
PennPRIME collected, said Bob Anspach, insurance services director.
One of the insurer's issues was the doubling of the window for filing claims, he said. Unlike health insurance, worker's compensation covers lost wages, rehabilitation costs and death benefits.
"What you're doing there is you're adding something that's brand new and very expensive, and you've had no opportunity to collect any premium for that," Anspach said.
The bill's sponsor, state Rep. Frank Farry (R-142) said he thinks the municipal trusts that dropped coverage for volunteers are "disingenuous." Heads of trusts participated in hearings, but none said they would have to eliminate coverage if the law passed, he said.
"They're throwing the volunteer firefighters out the window right now," said Farry, of Bucks County.
Farry also said the law requires firefighters to pass a physical exam before they begin their service to confirm they are cancer-free. Municipalities can refute any claims a firefighter makes, he said.
The state has received 66 claims since the law took effect, but none has been approved for benefits yet, Farry said. The number of claims likely will be higher in the first couple of years because it's a new law, he said.
David Sanko, executive director of the Pennsylvania State Association of Township Supervisors, said the law isn't much different from ones enacted in other states. The law levels the playing field for firefighters in Pennsylvania, he said.
Sanko said he hasn't heard about a rush of claims coming in since the law took effect a year ago.
"I guess they're being like a typical insurance company and not paying anything out," he said.
North Huntingdon manager John Shepherd did not have an estimated increase, but said the township's best option might be SWIF.
"Usually, the state fund is a fund of last resort," he said.
Officials in Hempfield and North Huntingdon said they expect an increase in their premiums, but their price quotes haven't been finalized. Hempfield paid a $53,833 premium for its 12 volunteer departments this year as part of $530,000 it set aside for fire services, Supervisor Chairman Doug Weimer said.
"There's going to be a significant impact," he said. "We just don't know the extent yet. We are working with SWIF to get a policy because it looks like there's no other avenue."
Copyright 2012 - Tribune-Review, Greensburg, Pa.
McClatchy-Tribune News Service
