Louisiana WC Costs-Per-Claim Jump 11%, WCRI Finds

NU Online News Service, Dec. 23, 11:54 a.m. EST

Workers’ compensation costs per claim in Louisiana shows the fastest growth in a 16-state study, according to the Workers Compensation Research Institute (WCRI).

WCRI reports that its study, CompScope Benchmarks for Louisiana, 12th Edition, finds a rise in costs per claim of 11 percent annually, from 2007 to 2009.

According to WCRI, this rapid growth relative to other states may reflect some impact from the recession. The organization notes that the recession’s effects appear to have been less severe inLouisianathan in other states, due in part due to the post-Hurricane Katrina recovery.

The main driver in the growth of indemnity benefits per claim was an increase of nearly two weeks in the average length of temporary disability.

Medical payments per claim also grew faster in Louisiana during the period than in other study states—26 percent compared to about 16 percent in the typical study state.

Another factor in the higher medical payments per claim is that Louisianahas the highest prescription payments per claim.

The study notes that state officials and system stakeholders view medical treatment guidelines enacted in 2009 as a step toward possibly improving medical care for workers and reducing costs to employers and insurers.

Mark Walls, assistant vice president, claims, with Safety National in St. Louis,Mo., tells NU Online News Service, “The recently released WCRI studies illustrate the continued escalation of workers' compensation costs nationwide. Rising medical costs are the main reason for this continued trend, and this shows no signs of leveling off.”

RegardingLouisiana’s increase, Walls observes, “I suspect this is a direct result of the economy. Louisianahas a wage-loss benefit that pays for up to 10 years. The lack of jobs due to economic conditions can make it very difficult to return injured workers to pre-injury wages.”

WCRI’s studies, he adds, illustrate the need “for pricing increases in the workers' compensation market. The industry combined ratios are well over 100. With continued escalation of costs, that is not sustainable. Premium rates have to increase to keep up with continually increasing claims costs.”

Comments

Resource Center

View All »

Complimentary Case Study: Helping achieve your financial goals By:...

Find out how a Special Investigation Unit used TLOxp to save the company money and...

Do Your Clients Hold The Right CDL License?

Learn about the various classes of CDL Licenses and the industries that are impacted by...

Integrated Content & Communications: A Key Business Issue For Insurers

Insurers are renewing their focus on top line growth, and many are learning that growth...

High Risk Insurance Coverage in the E&S Market

Experts discuss market conditions, trends and projected growth in a rapidly changing niche.

Top E-Signature Security Requirements

This white paper covers the most important security features to look for when evaluating e-signatures...

EPLI Programs Crafted Just For Your Clients

Bring us your restaurant clients, associations and other groups and we’ll help you win more...

Is It Time To Step Up And Own An Agency?

Download this eBook for insight on how to determine if owning an agency is right...

Claims - The Good The Bad And The Ugly

Fraudulent claims cost the industry and the public thousands of dollars in losses. This article...

Leveraging BI for Improved Claims Performance and Results

If claims organizations do not avail themselves of the latest business intelligence (BI) tools, they...

Top 10 Legal Requirements for E-Signatures in Insurance

Want to make sure you’ve covered all your bases when adopting e-signatures? Learn how to...

Workers' Comp Watch eNewsletter

Receive critical business insights into issues related to worker's comp insurance. Sign Up Now!

Advertisement. Closing in 15 seconds.