Employer WC Costs Down, But Medical Costs Rising

NU Online News Service, Sept. 9, 2:59 p.m. EDT

While employer workers' compensation costs in 2008 decreased compared to 2007, medical payments and cash benefits to injured workers saw the largest percentage increase since 2001, according to a report by the National Academy of Social Insurance (NASI).

NASI said total workers' compensation benefits paid increased 4.4 percent to $57.6 billion in 2008--the most recent year for which data was available. NASI said an 8.8 percent increase in payments for medical care drove medical spending to $29.1 billion in 2008, while wage replacement benefits paid directly to injured workers rose by 0.3 percent to $28.6 billion.

"For the first time, medical benefits accounted for over half (50.4 percent) of all benefits paid," NASI said.

John F. Burton Jr., chair of the panel that oversaw the NASI report, said, "The growth in medical spending may reflect both higher prices for medical care and greater use of services. The increase is the continuation of a long-term trend since 1980, but this is the first year that payments for medical care were more than half of all workers' compensation benefits."

Despite the increase in benefits paid and in medical spending, employers paid less for workers' compensation, the NASI report said. Employer costs--defined as benefits paid and administrative costs for self-insured employers, and premiums and deductibles paid for those who buy insurance--fell 6.7 percent in 2008 to $78.9 billion.

Top Story

What does TRIA denial mean for workers’ compensation?

What does the denial of a TRIA renewal mean to the workers’ compensation industry?

Top Story

Shock, dismay and disappointment: P&C insurance industry's reaction to TRIA news

The U.S. Senate adjourned for the year on Dec. 15 without passing the Terrorism Risk Insurance Program Reauthorization Act.

More Resources

Comments

eNewsletter Sign Up

PropertyCasualty360 Daily eNews

Get P&C insurance news to stay ahead of the competition in one concise format - FREE. Sign Up Now!

Mobile Phone
         

Advertisement. Closing in 15 seconds.