While it's important to celebrate the centennial of the workers' compensation system and appreciatehow much worse off we might be without this crucial safety net, I'dbe remiss in not considering the considerable challenges facinginsurers and risk managers in the years and decades to come.

In the short term, the economy will be the biggest threat facingboth employers and their comp carriers. We'll need a strongrecovery to get millions off the unemployment rolls and back intopaying jobs (with comp coverage) once again. At the same time,state-by-state reform battles will continue, seeking to save moneywithout undermining care for injured workers.

Longer term, however, there are a number of criticalmacro-trends—positive and negative— that are likely to have a majorimpact on insurers and their stakeholders as the second century inworkers' comp unfolds. Among them:

The Changing Workforce. We're likely to see anaging workforce, in part due to the need for many to stay on thejob so they can build more personal savings and afford retirement.Having more experienced workers usually means lower frequency ofclaims, but at the price of higher severity. Medicare Secondary Payer considerations will likely be morecommon as an increasing number of people work past the age of 65,adding both administrative costs and logistical headaches.

Meanwhile, we're dealing with a much heavier workforce, asobesity reaches epidemic proportions. That factor alone couldincrease claims frequency and severity, particularly in terms ofback injuries, while a growing number of workers will likely haveto cope with the effects of diabetes and high blood pressure. (InNew Jersey, a court granted comp benefits to an obese worker who died from ablood clot formed after sitting for hours at her workcomputer.)

In addition, we're going to be managing a far more diverseworkforce over the next 100 years, with many blue collar employeesrequiring training, written safety information, and directsupervision in their native languages, rather than in Englishonly.

There is likely to be far more telecommuters as well, whichmeans employers might have less control over working environmentsthan they currently enjoy. One woman in Oregon, for example,recently was granted comp benefits after tripping over her dog andbreaking her wrist while getting fabric samples out of her garagefor a work presentation. On the other hand, it might be easier andquicker to get telecommuters back on the job since they don't haveto travel to some remote work facility.

I believe we're likely to see greater employer emphasis onwellness programs, as more organizations try to promote ahealthier workforce to lower workers' comp as well as healthinsurance claims. But we're also more likely to have a "smarter"workforce, just like we have a far "smarter" military force today,with a greater reliance on advanced technology allowing people todo their jobs not only more efficiently, but more safely. Thatleads to our next section:

Tech to the Rescue! You can expect to see moresophisticated electronic monitoring of the workplace, particularlywith industrial jobs. This trend is already accelerating incommercial auto, and is likely to pick up steam in factory,warehouse, packaging, and shipping locations—although officeworkers won't necessarily be excused from this development. Thesafety and cost containment imperative is likely to ultimatelyovercome any "Big Brother" concerns.

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From the insurer's perspective, we'll see more automation of theclaims process. The more time adjusters are free to deal withclaimants and medical providers, and the less time they spendchasing down data and filling out documents, the better.

Predictive modeling, while no "magic bullet," could provide acompetitive advantage to those carriers that treat data as astrategic asset. Proactive analysis can raise red flags and headoff potentially bogus claims, as well as steer claimants towardsmore productive and cost-effective treatments.

Telemedicine is likely to be spurred on by an increased demandfor services following full implementation of health-care reform.Remote examinations and diagnoses could provide easier and cheaperworksite access to health professionals who specialize inoccupational medicine. Such immediate injury assessments could leadto more effective treatments and a quicker return to work.

Related: 11 Workers' Compensation Issues Sure to Impact2011

While we're at it, why not try teleadjusting as well? Ratherthan waste travel time or lose invaluable face-to-face assessmentsvia telephone interviews—or worse, investigation viae-mail—teleadjusting might make it easier to interview moreclaimants, supervisors, and witnesses while reviewing accidentlocations without actually having to be on site.

Social media will become a bigger factor in comp as well, on anumber of fronts. It can certainly serve as another potentialclaims fraud investigation tool—albeit with very carefulconsideration of how it's handled from a privacy perspective. Butsocial media could also provide an invaluable loss control andsafety communications platform.

Why not have mobile apps for workers' comp? Mobile technologycould very efficiently gather first notice of claims, as well asstatements and documenting pictures for incident reports, whilemonitoring an injured worker's ongoing rehabilitation andrecovery.

We're already seeing major administrative savings by replacingchecks with debit cards for claimants and providers. Theintroduction of the digital wallet, with mobile devices widely usedas a credit card, will only accelerate this positive trend.

The development of a nationwide system of electronic medicalrecords—also being driven by health-care reform—will likely have abig impact in patient care and claims investigations in comp. Thatleads to our next section:

Medical Cost Containment. A growing share ofthe comp claims dollar is going to pay medical expenses rather thanreplacement wages—with medical up to about 60 percent of the pienow, likely to rise to 70 percent before this decade is out if nomajor changes are made.

If the comp system is to survive to celebrate its bicentennial,insurers and employers will have to get a handle on the growth ofmedical costs—particularly when it comes to expensive prescriptiondrugs.

Health-care reform is likely to have a major impact on comp,again both positive and negative, should the law surviveconstitutional challenges and go into full effect as scheduled in2014.

The near-universal coverage called for will shrink the ranks ofthe uninsured substantially and likely decrease the number of compclaims filed fraudulently by those without health insurance. Butthe addition of millions of health insurance policyholders maydrive up demand for medical services, thus raising costs, limitingavailability and increasing wait times.

In addition, cuts in Medicare reimbursement levels might have animpact on states where comp payments are based on federalbenchmarks. However, there could also be cost-shifting in stateswhere providers can make up what they lose with Medicare patientsby charging higher rates to treat comp claimants.

The biggest question, of course, is whether the revamped healthinsurance system might eventually absorb the medical component ofworkers' comp. Could workers' comp survive if medical andreplacement wages are covered under two different policies? Themajority would suggest comp could not endure under thoseconditions, but that existential threat is only theoretical at thispoint.

In the meantime, expect comp insurers to expand the use ofmedical networks to secure doctors who are better trained to handleoccupational injury and more concerned with getting patients backto work, at least for modified duty.

You can also expect the widespread adoption of the Explanationof Benefits model used by health insurers to cut down on fraud,particularly by providers.

Evidence-based medicine and pharmacy benefit management willbecome even more sophisticated, as insurers command greater amountsof data to show what works—and what doesn't.

There are other threats to worry about—including the ongoingrisk of terrorism and the potential for new occupational exposuresfacing those working with emerging technologies—but thesemacro-trends will suffice for today.

As we commemorate the centennial of the workers' comp system,insurers, employers, and workers have much to celebrate and bethankful for. The next century will pose some predictable and nodoubt many unforeseeable challenges. What's certain is that changeis ahead, and the biggest question is whether you are prepared tomeet it proactively.