As recent data become available, the long-term impact of the pandemic on workers’ compensation is slowly becoming clearer.
The Annual Workers Compensation Accounting Data Survey report showing payouts and costs for the state’s workers’ compensation system from 2011 to 2020 has been released by the National Unemployment Compensation and Workers Compensation Foundation. This report is based on data from the National Social Insurance Academy (NASI).
As the industry emerges from the pandemic, bulletins are beginning to consider the impact of COVID-19 and a recession in 2020 after the economy expanded from 2011 to 2019.
Douglas J. Holmes, president of the National Foundation for Unemployment Compensation and Workers Compensation, said that while the impact on reported workers’ compensation data has not been quantified, “total health care costs in 2020 will be It’s gone down significantly because there are fewer people working, which to some extent is the result of all recessions.”
Total compensation (cash) benefits decreased by $314.86 million (-1.1%) from 2019 to 2020, but increased by $1.09 billion (3.9%) from 2011 to 2020. , decreased by $2.97 billion (-10.0%) from 2011 to 2020.
The decline in payroll employment during the pandemic appears to have reduced the number of on-the-job injuries and illnesses covered and covered under workers’ compensation.
The comparison of cost per employee by state has not changed significantly due to the impact of COVID-19 in 2020. Data should not be used for state-to-state comparisons, as employers do equivalent work across states and do not account for differences in industry composition.
break the thread apart
Additional operating assumptions based on this year’s data included determining and compensability issues for injuries related to COVID infection, Holmes said.
“With a higher proportion of workers working from home, it may have been more difficult to determine whether COVID-19 illness was during the course of employment and attributable to employment. ‘ he said.
“Some states have enacted presumptions of coverage and reimbursability on positive COVID-19 tests, but in many cases the presumptions are rebuttable, temporary, or specific to certain groups of workers (health care workers). ) only applied to
In fact, the state legislature’s national session reported in early 2022 that: 11 out of 28 states It is rebuttable that we have passed the Workers Compensation Act presumption for COVID infection.
The National Protection Insurance Council (NCCI) further fleshed this out in an early 2022 report. 9 states enacted COVID-19 workers compensation presumptions in 2020 (Alaska, California, Illinois, Minnesota, New Jersey, Utah, Vermont, Wisconsin, Wyoming), followed by additional states with more specific exceptions to the presumptions I was.
Holmes said the data also cannot fully reflect COVID because of other complicating factors. “If circumstances indicate that an individual became infected while employed and the illness occurred while employed, the illness would likely be covered and compensated,” he said.
“However, in most cases, medical costs associated with COVID-19 are likely to be minimal (medical only) or short-term. COVID-19 (as an infectious disease) is may have been covered by the workers’ compensation scheme and may not have been reported through the Workers’ Compensation Program.”
The national trend from 2019 to 2020 was a decline in average benefit cost rates, according to state data. Only South Carolina (4.8%), Hawaii (2.5%), Delaware (1.4%) and Oklahoma (1.4%) increased. The states with the largest declines in average benefit cost rates from 2019 to 2020 were Alabama (-20.9%) and North Dakota (-18.5%).
In terms of cost per eligible employee, Wyoming, Washington, California, and New York lead with $804, $799, $736, and $704, respectively. These states were followed by Hawaii, Alaska, New Jersey and West Virginia.
The states with the lowest cost per covered employee were consistent with previous reports.
● Texas ($141)
● Arkansas ($158)
● Utah ($196)
● Indiana ($202)
● Michigan ($204)
● Tennessee ($206)
●Virginia ($228)
● North Carolina ($240)
Ripple effect
Hard numbers aside, much has been made about the dangers of inflation threatening the post-pandemic recovery, which could be below current general expectations of a decline, but not by much. I have. For Holmes, as long as the work patterns developed during the pandemic continue (i.e., more workers work from home), reported illnesses and injuries that occur during or are attributable to employment may decline. there is.
“A review of the 2021 and 2022 data will be interesting on this issue,” Holmes said. “Healthcare costs (as in other costs) are increasing as a function of general inflationary pressures in the economy, which is likely to be reflected in the 2021 and 2022 data.”
Regarding healthcare inflation and the likelihood of future changes in reported numbers, this is difficult to quantify, but improved healthcare management could play a role.
“Certainly, there are differences from state to state and industry to industry regarding safety, transition work, prescription drug formularies, and treatments,” Holmes said.
“Pandemic experience can influence policies related to diagnosis and treatment. However, other variables make it difficult to draw conclusions based on this data alone.Over time, the workforce has changed and the nature of work has changed. ”
While this report did not see a shockwave from COVID, Holmes acknowledged that future reports may see fluctuations directly attributable to COVID.
“Some of our 2020 COVID-related costs may not have been reflected in our 2020 payments. We need to use additional 2021 data to provide a more complete analysis.” He said.
Report available for purchase here. &
