Workers Compensation By The Numbers

December 11, 2012 Insurance Topics 2

Work-related injuries, illnesses and deaths:

Highest number of workplace fatalities (in recent years)        8,801  in 2011
Those due to 9/11 terrorism attacks          2,886
Number of workplace fatalities in 2012:     4,690
Number of private industry nonfatal workplace injuries and illnesses in 2010:      3.1 million                                                                                                                                       

Number of cases per 100 equivalent full-time workers (2010):   3.5
For 2009:   3.6

The Cost of Workers’ Compensation for Employers
In 2010:    $71.3 billion
(This is the lowest cost since 1980)

Amount covering benefit and medical costs:  $57.5 billion
 (a .7 percent decrease from 2009)

Highest cost year for workers’ compensation: 2005 @   $89.2 billion

Per $100 of payroll costs in 2010:                                                                  $1.23
This is small potatoes compared to healthcare, which is                         $7.60
(wonder how ObamaCare will change that amount)

The workers’ compensation cost is almost $1 cheaper than 1980, when it was:  $2.18

Most expensive state in 2012:     Montana @ $2.73
The least expensive:           Washington, D.C. @ $.50

Net premium for private carriers in 2011 (preliminary):  $ 32.2 billion
(This 7.9 percent increase is the first since 2004.)

2008: The year that medical benefits started to cost more than wage replacement benefit accident year combined ratio.

Annmarie’s Take: Workers’ compensation costs have diminished for many reasons. While everyone agrees there is room for improvement, the system in general is more efficient thanks to research, legislative action and regulations. Commitments to workplace safety, return to work and other initiatives once considered cutting edge are now best practices. That said, there are still too many unenlightened employers who are not making steps to improve their workers’ compensation results. Claims frequency has diminished dramatically due to workplace safety improvements but also because eligibility for workers’ compensation has been restricted.

Key ways to improve the system remain. Improving employee communication, ensuring immediate claim filing and assuring responsive claims personnel will reduce the need for attorneys and assure better medical treatment. These efforts will make noticeable differences in claims duration and severity and therefore, costs. The growing epidemic of long-term opioid use without appropriate medical monitoring needs immediate legislative and regulatory attention. Injured workers and their families are suffering too much from this problem and, of course, it makes workers’ compensation more expensive.

What do you think?

Sources: U.S. Bureau of Labor Statistics, National Academy of Social Insurance and the National Council of Compensation Insurance, Inc. 

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