Comp Injury, Death Rates Still Fall; Is Underreporting Or Safety Behind Stats?

"American workers are, by and large, experiencing fewer workplace injuries and deaths due to improved efforts by employers to provide a safe workplace," he said.

Mr. Oxfeld also noted the fact that the United States has "moved generally in the direction where employment includes more and more jobs that pose a lower risk of physical injury," he said

David Corum, assistant vice president at the American Insurance Association in Washington, D.C., agreed with Mr. Oxfeld. "There has been a marked decline in the frequency of workplace injuries," Mr. Corum. But, he pointed out, the average cost of claims and the overall workers' comp benefits and costs continue to go up significantly.

"And the biggest reason for this cost increase is benefit systems. Medical costs have been increasing and medical benefits have gotten more generous, especially in California," Mr. Oxfeld commented.

"Many states have increased their benefit levels. The duration of disability has increased in many states and the workers comp systems in a number of states are plagued with the inability to resolve disputes, and that tends to prolong the time workers receive benefits," he said.

Mr. Oxfeld added that since employers have higher workers' compensation costs, "that has given them a direct financial incentive to make the workplace safer–because the cheapest workers comp claim is the one that doesn't occur because there never was an injury."

According to the latest available statistics from the Bureau of Labor Statistics at the U.S. Department of Labor, in 2001 some 5.2 million injuries and illnesses were reported in private industry workplaces, which translates to 5.7 cases per 100 full-time workers. This represents a drop from 2000 when the case rate for the year was 6.1 per 100 workers. The 2001 figure is also the lowest rate since the bureau started tracking this figure nationally in the early 1970s, a labor department spokesperson said.

Comparable figures for work-related deaths have also showed a slowdown. In 2001, 8,786 fatal work injuries were reported in the United States, including 2,886 deaths from 9/11 terrorist attacks, according to the Bureau of Labor Statistics. Excluding 9/11-related deaths, the number was down slightly from the previous year, and the figure has been on a downward trend for the past 10 years.

According to Peter Burton, senior division executive of state relations at Boca Raton, Fla.-based National Council on Compensation Insurance, this decline in injury and death rates is a long-term trend. He said the trend is driven by technological advances, such as the use of robotics, ergonomic designs, stronger and lighter construction materials, and cordless tools to minimize electrical hazards.

"A lot of companies have gone from manual labor to mechanized manufacturing processes. Look at how cars are manufactured and how the construction is done today," said Mr. Burton. "There is now more and better workplace training, and in offices, chairs and desks are more ergonomic."

Mr. Oxfeld added that declining injury/death rates were also helped by economic factors. "Because we have had a recession and flat employment–or even reductions in employment–there aren't as many new, inexperienced workers, and we have more experienced workers in the workplace," he said.

"Experienced workers generally have a lower frequency of injuries because they know what they are doing. Experienced workers are also somewhat older, and older workers generally don't take as many risks," he said.

But according to the Bureau of Labor Statistics, there could be other, less encouraging reasons–such as the possible underreporting of injuries.

"Companies, often unintentionally, perpetuate a variety of policies and management practices that may lead to factors and attitudes among people in the organization" that result in underreporting, the bureau stated.

The department made that finding in Occupational Injury and Illness Rates: Why They Fell, a study which was published in 1998 and is the department's most recent report on this topic.

William Wiatrowski, assistant commissioner of safety, health and working conditions at the bureau, told National Underwriter that such management practices may include denying employees overtime or promotion opportunities for reporting an injury, and offering employee groups gifts or bonuses if no injuries are reported.

"These disincentives to report occupational injuries and illnesses are difficult to address because they often reflect psychological factors and attitudes among people in the organization," the report said. "The result is that company injuries and illnesses will be chronically underreported."

According to the report, another reason for falling injury and death rates could be tied to the current economic slowdown: during hot economic times, orders gets piled up and employees tend to work faster to keep up, which can lead to more accidents.

But some industry participants strongly disagreed with the report and said underreporting is not a significant issue.

"The main reason for the declining workplace injury rate is the general employer focus on accident prevention and on properly handling work-site safety issues," said Robert Steggert, vice president of casualty claims at Bethesda, Md.-headquartered Marriott International Inc. "Employers are paying closer attention to workplace safety," he said.

"Workers themselves have greater appreciation for their safety, and insurers have contributed their efforts," Mr. Steggert continued.

"I don't put a whole lot of credence into underreporting allegations," said Mr. Steggert, who is also a study-panel member for national data on workers' compensation at National Academy of Social Insurance in Washington, D.C.

"No doubt, in any environment, you are going to have some underreporting. But major employers and what I would call 'quality employers' are much more focused on absolute timely reporting," Mr. Steggert observed.

Mr. Oxfeld also added that he has heard critics make the argument that there is an incentive to hide injuries. "Employers are human beings like everyone else. So I wouldn't say this doesn't occur. But I don't think there is any reason to doubt that improved numbers that we are seeing now accurately represents improved workplace safety," he said.

"The frequency of claims has been on the decline, which matches injury statistics from the federal government."

At Marriott, the world's largest lodging company, the loss-frequency figure has been mirroring the nationwide trend and has been falling steadily over the years, Mr. Steggert added. "But the overall workers' comp costs have been going up. It's a combination of medical costs and benefit systems, particularly in California, that are in a dire need of reconstruction."

Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, August 18, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.