State of the States May 6, 2022

Work Comp Insights

Health-E systems released their 2021 workers’ compensation insights

NationalHealth-E Systems released their 2021 Workers’ Comp Insights in association with Risk & Insurance Journal. The survey interviewed 498 workers’ comp professionals, with the top respondents being employers, insurance companies, brokers, and healthcare providers. Of those surveyed, 51% reported organizational efficiency as a top priority; 48% say claims process automation is the most critical technology in the industry; 71% are concerned with changing workforce and its impact on the industry; 64% of claims professionals report having issues with obtaining information from providers. 59% of professionals believe employee retention, recruitment, and development is the highest organizational priority in the next 3-5 years, followed by 51% with operational efficiency, 36% for new business development, and 29% want to prioritize improved customer service. Regarding factors impacting the resiliency of the workers’ compensation industry, respondents say that the changing workforce (71%) and regulatory/legislative changes (47%) are top concerns. Managing patients with chronic illness and comorbidities (46%) is the top priority for medical issues amongst workers’ compensation experts. The top three barriers to recovery were attributable to injured workers’ unfamiliarity with the workers’ comp system followed by injured worker behavior/noncompliance and comorbidities. Mental health claims and comorbidities remain the top two issues when it comes to claim complexity.

Nationally severity and claims cost are on the rise

National

Severity, and cost of comp claims are on the rise. Data from Gallagher Bassett Services, NCCI, WCRI, and Rising Medical Solutions show that certain factors such as an aging workforce and medical inflation from advanced medical technology contribute to higher costs. Hospital consolidations have also been considered to contribute to increased costs. However, most experts believe the aging workforce is the primary issue as recovery often takes longer when older, and comorbidities become more common. Bureau of Labor Statistics shows that from 2001to 2021, the number of workers over 55 increased by 10%. These workers represent over a fifth of lost-time injuries and 31% of costs. The average claim cost for those workers over 55 is also 50% higher than younger workers.

Mitchell Pharmacy National 2021 Drug Trend Report says that cost per claim rose 1.3% while cost per script rose 1.1%

National

Mitchell Pharmacy Solutions Drug Trend 2021 report evaluating retail and mail-order prescriptions showed that cost per claim rose 1.3%, with cost per script increasing 1.1%. Utilization per claim increased by 0.2%; the most significant utilization increases were seen within the hematological and respiratory drug classes. Opioid utilization, like in previous years, continues to decline, with utilization per claim dropping 3.1% and cost per claim down 6%. Average wholesale price decreased 1.6% for generics but rose 3.4% for brand medications averaging out to an overall AWP increase of just 0.4%.

Connecticut legislators are close to fully passing enhanced cancer presumption benefits for firefighters in the state

CTThe state senate passed SB313 last week, allowing it to proceed to the house, where it already received a favorable report in committee. Bill language provides firefighters with an enhanced cancer presumption by adding brain, skin, skeletal system, digestive system, endocrine system, respiratory system, lymphatic system, reproductive system, urinary system, or hematological system cancers to the list of cancers covered. Grouping cancers that affect parts of the body rather than listing each individual cancer benefits injured workers as it broadens the range of cancers that are covered. Although providing a more robust presumption, it is rebuttable under certain circumstances, such as if the firefighter partakes in cigarette smoking or does not wear specific protective gear consistently. If fully passed, the bill will come into effect in July of this year.

Florida’s courts clarify coming and going rules (commuting to and from work) narrowing the interpretation of a compensable injury

FLA Florida court recently clarified the state’s interpretation of coming and going rules via Hernandez v. KBF Renovations. A new ruling from the 1st district court says that employees traveling from home to a work site are generally not protected -- even if required to travel for work from site to site. Justices concluded that work does not refer to a physical location but rather when the labor of an employee in exchange for his/her wage commences. The employee did not receive compensation upon driving the vehicle; therefore, they are considered not in the scope of employment at the time of the accident. The court said that coverage begins only upon arrival at the worksite and ends when departing the worksite. Justices did consider that the employee’s reimbursement for fuel at $165 a month may be regarded as compensation which could make it a viable claim but ultimately decided against such a proposition.

New York’s state senate passed a bill making it easier for New York residents of all occupations to make a mental injury claim

NYThe state senate recently passed a PTSD/Mental Health Injury bill for the second year in a row. SB6373 would allow all workers to file claims for PTSD/Mental Injury, greatly expanding the pool of eligibility. However, unlike presumptions for first responders where the burden of proof is easier to meet, SB6373 requires that employees display “a factual finding that the stress was not greater than that which usually occurs in the normal work environment.” The measure failed last year in the Assembly as it failed to gain interest. If fully passed, the act would take place with immediate effect. If enacted, the legislation could make its way into the courts to better clarify the standard of stress necessary to make a compensable claim.

Note: To access audio for the LWU please access audio via Adobe by a.) choosing “view” at the top menu b.) click “activate read out loud” c.) click “read to end of the document”.

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