PENN. WORKERS’ COMP CLAIMS COSTS:

Workers’ compensation costs per claim in Pennsylvania continue to grow, according to the Workers’ Compensation Research Institute (WCRI). A study by the Cambridge, Mass-based WCRI found that costs per claim rose 8.5 percent per year on average from 1999-2000 to 2001-2002, for claims with 12 months of experience. This contrasts with more moderate growth of 4 percent to 5 percent per year in the two years prior to 1999. Nevertheless, at an average of $2,710 per claim, total costs per claim in Pennsylvania are 15 percent lower than the median of the other states. WCRI said that the major factor behind the recent increases in Pennsylvania was a double-digit increase in medical costs. The cost of indemnity benefits per claim rose 5 percent due to the growth in claims involving more serious injuries—permanent partial disabilities (PPD)—or lump-sum settlements and due to an increase in the duration of temporary disability. Benefit delivery expenses per claim increased at double-digit rates from 1996-1997 to 2001-2002, driven mainly by growth in medical cost containment expenses per claim. “Efforts to control rising workers’ compensation costs should focus on the cost drivers in Pennsylvania,” said Dr. Richard Victor, executive director of WCRI. “This report will help policymakers in Pennsylvania assess the root causes of what’s behind the increases—rapidly increasing costs per claim, particularly double-digit increases in medical costs per claim and benefit delivery expenses.” The study found that 44 percent of workers in Pennsylvania received their first check within 21 days of injury for 2001 claims as of 2002. This result was typical of the states in the study. Unlike most study states, Pennsylvania saw a two-point increase in the percentage of claims paid within 21 days of injury for the most recent year. The study noted these results might reflect the impact of efforts by public officials, insurers and employers during the past few years to improve time to first payment.

Topics Claims Workers' Compensation Pennsylvania