Last week, WorkCompCentral released a report, The Uncompensated Worker, that I authored. It is about how a work injury affects family finances. I applied several realistic work injury scenarios to each state. In 31 states, workers receive a reduction in take-home pay of 15% or more when they’re injured on the job. In half the states, households with two median wage earners, one on work disability and the other working full time, cannot afford to sustain their basic budget.

These findings from scenarios applied to all fifty states confirmed what workers’ comp claims adjusters, attorneys and case managers already know: many injured workers live on the edge of financial collapse.

But the findings are by no means conclusive.  The research done for this study was too limited. I know, because I did it. To really understand the financial experience of being on workers’ comp benefits, one should run not a handful but thousands of scenarios through a statistical analyzer. And then one needs to compare the data results with actual cases researched through interviews.

The research agendas of the workers’ comp industry rarely involve looking at the worker her or himself.

Instead, the industry has funded research mainly to understand the drivers of claims costs, specifically medical care. This focus can be explained. Over the past 25 or so years, the workers comp industry has absorbed a huge rise in medical costs, more and more layers of regulation relating to medical treatment, and ever more specialties needed to deliver or in oversee medical care. 

To illustrate the extent of this industrial-medical complex, nationwide spending on “loss adjustment expense,” a proxy for specialist oversight of claims, has grown annually on average since 1990 by 9.4%, while total claims costs have risen on average by 2.5%.

The quality of industry-funded research has improved.  This is due to better data and strong talent pools in places like the Workers’ Compensation Research Institute, the California Workers’ Compensation Institute, and the National Council for Compensation Insurance.

Their research focuses on cost containment and service delivery. These two themes often intertwine in studies about medications, surgeries, or medical provider selection.

It’s time to pay more attention to the worker.  Close to a million workers a year lost at least one day from work due to injury.  We hardly know them.

Bob Wilson of Workerscompensation.com predicts that in 2016 “The injured worker will be removed from the system entirely…culminating a move started some 20 years ago, this final step will bring true efficiency and cost savings to the workers’ comp industry.”

Industry research, one might say, has left the worker out the system.

An example of how the worker is removed is how the WCRI did an analysis of weekly benefit indemnity caps. These caps set a maximum benefit based typically formulated on a ratio with the state’s average weekly wage.  (The methodology has probably not been critiqued by states for generations, despite better wage data and analytical methods.) The WCRI modeled different caps to estimate the number of workers affected.  But it did not report on what this meant to these workers and their families; for example, by how much their take home benefits would go down or up.

As it happens, Indiana is one of the worst states in which to be injured at work.  It has close to the stingiest benefits for a brief disability.  You are not paid for the first 7 calendar days of disability. That waiting period is restored only if you remain on disability for 22 calendar days. Take home pay for the injured work out for two weeks or less will likely be 83% less than what it would have been without injury. An Indianapolis couple both at the state’s median wage cannot afford a basic month budget for a family of three when one is on extended work disability.

These poor results are partly due to Indiana’s benefit cap, one of the lowest in the country.  The weekly benefit cap used in the report, a 2014 figure, was $650. 

Les Boden, Professor at Boston University’s School of Public Health, read a draft of The Uncompensated Worker.  He has studied for years income of injured workers and the adequacy of workers compensation benefits.  He wrote me, “Studies have shown that many people with work-related injuries and illnesses don't receive any workers' comp benefits. I don’t think that the problem is too little research. It’s political. Unfortunately, workers are invisible in the political process and businesses threatening to leave the state are not.”

I am not sure how the politics can change until the strongest research centers in the industry begin to pay attention to the worker.

Peter Rousmaniere is a consultant for workers' compensation claims administrators and vendors and a veteran observer of workers' compensation industry trends.