46 states have a private workers’ compensation system: Wyoming should join them

Did you know that Wyoming is only one of four states in the U.S. with a completely government-run workers’ compensation insurance system? Washington, North Dakota and Ohio are the others.

North Dakota and Ohio have managed to keep their rates low. But Wyoming’s approach has led to some of the highest rates in the nation for workers’ compensation insurance. In 2020, Wyoming’s rates were the highest in the nation, falling to 7th highest in 2024.

As background, workers’ compensation was one of the first social insurance laws passed in many nations. Some federal workers in the U.S. started to receive benefits in 1908, and New York became the first state to pass a law in 1910.

As written in 2024’s “Worker’s Compensation: Benefits, Costs and Coverage” by the National Academy of Social Insurance, “Passage of the laws required extensive efforts on the part of both business and labor leaders in each state to reach agreement on the law’s specifics. Ultimately, both employers and employees supported workers’ compensation statutes, often referred to as the ‘grand bargain’ because the laws contained some principles favorable to workers, some principles favorable to employers, and some principles beneficial to both parties.”

Because of fewer accidents, deaths and injuries in the Cowboy State and around the nation, rates have been falling everywhere over the past two decades. The fact that 10,000 jobs in the natural resources and mining sector – higher-risk positions – evaporated in the state over the last decade likely also contributed to the fall in rates.

Gov. Mark Gordon announced in November a 15 percent rate decrease for 2026, saying, “Wyoming’s businesses are the backbone of our economy, and this rate reduction is one more way we can support their success.” He added, “By lowering workers’ compensation costs, we are helping employers invest in their workforce, strengthen their operations, and continue to build safe, resilient workplaces across our states.”

Falling rates are good for Wyoming businesses in both human and economic terms, as they signal fewer workplace deaths and injuries for workers and smaller payouts by the government. But they could be much lower if the state opted to privatize the market like West Virginia did in 2006.

Since that state privatized its market, it’s seen an 85 percent reduction in costs compared to its pre-reform days. It has the third-lowest rates in the nation and Gov. Patrick Morrisey announced in August that the state’s rating and statistical agent requested a 13.5 percent decrease in premium rates from private insurers in 2026. The legislation received wide bipartisan support when Gov. Joe Manchin (D) signed it into law in 2005.

Being an insurance agent is not a core function of government, especially when a healthy private market exists throughout the U.S. If Wyoming officials truly want to support the state economy and allow businesses to invest in their workers and infrastructure, policymakers should advocate for privatizing workers’ compensation insurance to reduce rates and expand coverage. Let those who know the market best be the ones providing the service.

We wouldn’t want Wyoming government workers to run grocery stores and fix or sell cars, so why do they still sell insurance?