The National Academy of Social Insurance has just released its latest report on workers’ compensation. This is required reading for any serious student of work comp; it’s stuffed with insights just waiting for you.
Here are a few. Note: COVID’s impact on 2020 results is significant, especially regarding medical costs and the relation of medical to other work comp financial metrics.
- From 2016-2020, medical benefits paid (per $100 of covered wages) dropped by almost 25%.
- This followed a 17-point drop over the previous five years.
- The massive decline is (likely) due primarily to lower claim frequency.
- Medical costs:
- Totaled $27.7 billion in 2020, $2.5 billion less than in 2019.
- Accounted for 53% of benefits in 2020, down from 56% in 2019.
- Are a reminder to those who predicted massive increases in medical costs due to COVID. A much deeper understanding of health care delivery, cost drivers and sources of cost data would be quite helpful.
- The California Workers' Compensation Institute's analysis indicated that the Golden State accounted for a fifth of all benefits paid (bulletin available at no cost to CWCI members).
- Overall, employers’ work comp payroll-adjusted costs dropped almost 9% from 2019 to 2020.
The NASI report can be downloaded for free.
Joseph Paduda is co-owner of CompPharma, a consulting firm focused on improving pharmacy programs in workers’ compensation. This column is republished with his permission from his Managed Care Matters blog.