Tag: Workers Comp

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A divided Tennessee Court of Appeals ruled Friday that a sales representative for a hardware company could not pursue a civil remedy from a retailer after he was injured at one of its stores.

Brian Coblentz worked as an outside sales representative for Stanley National Hardware. The job required him to visit various hardware stores in his region. In 2012, he visited a Tractor Supply store in Fayetteville, Tennessee, and suffered injuries when a 12-foot steel barn door track fell out of the Stanley National display and struck him on the head, according to Coblentz v. Tractor Supply Co.

After receiving workers compensation benefits from Stanley National, Mr. Coblentz sued Tractor Supply Co., claiming the store had negligently installed or maintained the display and failed to warn him of the danger. Moving for summary judgment, Tractor Supply said the case was subject to exclusive remedy. A trial court agreed.

The Tennessee Court of Appeals said that workers comp immunity can be extended to “statutory employers” through a contractor/subcontractor relationship. Generally, a company is considered a contractor if the work “being performed by a subcontractor’s employees is part of the regular business of the company or is the same type of work usually performed by the company’s employees,” the court said.

Because Mr. Coblentz visited Tractor Supply’s store frequently, “(w)e consider the frequency of Mr. Coblentz’s visits to be consistent with the type of services he performed at the Tractor Supply Store and one indicator that the services were part of Tractor Supply’s regular business,” the court wrote.

One judge dissented, arguing that “vendor-vendee relationships have not been fully grappled with in Tennessee case law” in a statutory employer context.

WorkCompCentral is a sister publication of Business Insurance. More stories here.

Lauded as the most profitable commercial insurance line, workers compensation is seeing increases in indemnity payments in several large states post-pandemic, likely spurred by wage inflation, but the trend is unlikely to trigger a reversal in year-over-year rate decreases for now, experts say.

In the latest report to show comp payments to injured workers on the rise, the Workers Compensation Research Institute on April 23 released data that showed indemnity benefits per workers comp claim grew at a “rapid” pace of 6% or more in 2022 in 16 out of 17 states analyzed, with several showing double-digit increases.

WCRI said the tight labor market post-pandemic led to wage growth across the board, highlighting several states that saw wages increase as high as 9%. That trend is likely to continue, experts say, as more than a dozen states are seeking to increase or have already increased the minimum wage.

A report released Tuesday by the U.S. Department of Labor’s   Bureau of Labor Statistics showed the Employment Cost Index — which it calls “the broadest measure of labor costs” — increased 1.2% in the first quarter, after rising by 0.9% in the fourth quarter of 2023.

Sebastian Negrusa, Cambridge, Massachusetts-based WCRI’s vice president of research, said longer disability timelines and higher employee turnover during the pandemic were also contributing factors to the rise in indemnity in workers comp.

“Our main conclusion was that it was economic factors related to the pandemic and the subsequent recovery that likely contributed to these recent changes in wages,” he said. “And, to some extent, these economic as well as other factors contributed to the duration of temporary disability, which is another key factor in indemnity payments.”

Industry experts say the increases, some temporary and spurred by the pandemic, will likely be offset by increases in premium — based on payroll — and the industry’s continuing downward trend in the frequency of workplace injuries.

“There’s a long-term decline in frequency for many years, and that, so far, is outweighing any increases that we see in medical or indemnity severity,” said Christine Williams, New York-based managing director of the Workers’ Compensation Center of Excellence at Marsh LLC.

“It’s going to be a little bit different here and there, but, generally, the impact of any indemnity cost increase would be minimal to the workers comp line of business overall, but we do want to watch this trend,” she said.

Analysts with A.M. Best Co. Inc., who pegged in a 2023 report that a continuing downward loss trend in comp has helped boost the industry’s reserves and profits, said rises in indemnity – with wage inflation triggering the increases — are also an area to watch.

“Yes, we will see more larger losses per claim on indemnity, but you’re also going to see a big increase in premium to go with it because the rates are set according to whatever the payroll is,” said Christopher Graham, an Oldwick, New Jersey-based senior industry research analyst for A.M. Best.

David Blades, A.M. Best associate director, also based in Oldwick, said rising payments to injured workers, coupled with other factors such as medical inflation, are issues “we definitely have our eyes on.”

“We as an industry, I think we’re looking for when we might start seeing some potential problems creep into the workers comp market and when we’ll start seeing some of the margins tighten or be a little more constricted,” Mr. Blades said. “But, right now, we haven’t seen anything that we need the flashing neon light on … but there’s no question that we’re looking at it.”

In workers compensation claims, outcomes have historically depended on the quality of experts — both the claims adjuster and, less visibly, a team lending support to adjusters behind the scenes. What if that team wasn’t just made up of human experts but also included a squad of artificial intelligence bots, or “agents,” working in tandem, with each ready to assist with its specialized skills? That’s the future, and it’s closer than you might think.

Generative AI is the buzzword of the day, grabbing headlines left and right. But for those in the know, AI has been a secret weapon for years. For forward-thinking organizations, it’s been a quiet partner in making decisions that significantly impact claim outcomes. 

From reserving to clinical intervention, provider selection to litigation avoidance, and subrogation to return to work, AI has been there, quietly guiding key decisions and improving outcomes. It’s the brainy assistant that never sleeps, tirelessly sifting through data to find golden nuggets of insight.

Up to this point, these various AI models have been spokes feeding information back to a human hub, typically the adjuster. As AI continues to proliferate, this could soon be akin to a basketball team in which the players only ever communicate with the coach — and never with each other. Whether on the court or with a claim, communication flows best when all the players on the team are actively engaging with one another.

The solution is to develop AI agents that can communicate with one another, working as a bona fide team and ultimately presenting human experts with a cohesive plan. That plan will support the claims adjuster with recommendations and supporting information in making the critical decisions on the claim — decisions which, for the foreseeable future, will remain in the expert hands of the human adjuster.

Notably, large AI companies like Google and OpenAI, makers of ChatGPT, use a similar approach in creating their AI models. These GPT models are refined using an approach in which one AI agent proposes a response to an input, and a second AI agent grades the response based on what it has learned about human preferences. Similarly, in the claims world two or more AI agents working can generate significantly better recommendations when they work together. 

To illustrate what this could look like in workers compensation, start by imagining components of your dream team for managing claims: intake and assignment staff to get things rolling; clinical oversight to flag clinical/psychosocial risks and mitigate them; litigation avoidance and fraud investigator experts to navigate and mitigate risks; a claim auditor to review output and ensure consistently high quality across the team; a comp law expert to provide up-to-date legal insights as needed; a licensed adjuster, accountable for critical claim decisions; and an administrative assistant to help coordinate the team.

Now, let’s leap into the future where this team is AI-based. The moment a claim is filed, the AI team begins its work. An AI intake agent takes the First Notice of Loss and follows up with relevant questions helpful to the investigation of the claim. Key pieces of information are passed to AI teammates for further processing. Then, the clinical oversight agent reviews the information passed to it from the AI intake agent and spots signs of acute psychosocial challenges. It recommends immediate human clinical intervention and sends an alert to the litigation avoidance agent, given the observed relationships between psychosocial risks and litigation. Later, the claim auditor agent reviews claim facts collected to date and notices factual inconsistencies in verbal and written correspondence provided from intake. It engages the fraud investigator agent with this information to gauge the risk of fraud and determine appropriate next steps to mitigate risk. The legal expert reviews action plans recommended by the AI team and ensures adherence to relevant laws. Any regulations that would require action by the adjuster are flagged for follow-up. 

Then, a claim assignment agent reviews output passed from the agents above, which it uses to determine the claim’s unique risks and complexity. Based on this, it identifies the optimal licensed adjuster to handle the claim. Lastly, the administrative assistant agent compiles all findings, including action items, and schedules time for the designated adjuster to review them the next day.

By the time the human adjuster logs in, a coherent and cohesive plan is waiting for them. This AI dream team stays engaged 24/7, offering unwavering support throughout the claim’s lifecycle.

This is the future of claims management: a blend of AI efficiency and human expertise, where much of the heavy lifting is done before the sun even rises. It’s a vision in which AI agents work together to provide and empower the human adjuster with the information required to make the nuanced, critical decisions that truly require human judgment. 

The technology to create a seamless, efficient and thorough claims management process is largely already here. However, it demands a paradigm shift — from isolated AI solutions to holistic AI teams that can collaborate effectively. 

Currently, the market is flooded with AI solutions, but they often leave the human professional as the central “hub” in the wheel among an ever-growing number of AI “spokes,” potentially creating a choke-point as humans coordinate with disconnected AI models. What we need is an architecture in which the AI agents can self-coordinate.

There are two ways to capitalize on this opportunity. You can architect your own AI team. To build this team, you need to be great at not just building AI agents but also getting them to work as a team. One key to success in building your agents is establishing a rigorous evaluation methodology, ensuring your agents consistently outperform humans at the same task. Getting the agents to work as a team requires a long-term vision for the team’s composition and rapid iteration to make that vision a reality. Or you can partner with a group with this vision. This involves partnering with firms with a vision for a team of AI agents. Be wary of firms that offer a collection of independent AI models with no plans to integrate these into a team. 

Whether you want to build your own AI team or partner with a visionary group, the key is to be aware of the promise and peril of AI teamwork, and how they can be addressed with superior claim outcomes in mind. AI agents can achieve more and have more profound claims impact together than alone, but they need careful design, evaluation and integration to perform well. By planning for this opportunity, you can gain a competitive edge.

Joe Powell is senior vice president of analytics and product innovation at Gallagher Bassett. He can be reached at joseph_powell@gbtpa.com.

 

 

 

Aging worker claims often are more susceptible to litigation, as issues of causation and claim expansion come into question. 

Older worker claims may be slightly more challenging to handle once in litigation because of issues such as Medicare Set-Asides and a potentially higher percentage of disability paid, according to John Geaney, co-chair of the workers compensation practice at Mt. Laurel, New Jersey-based law firm Capehart Scatchard PA. 

Recovery can also be hampered, and litigated claims tend to cost more overall, he said.

“I’m telling the employer right from the beginning … to reserve more money generally because the recoveries aren’t as good,” Mr. Geaney said.

The age of an injured worker can affect the resolution of a litigated claim, said Alan Gurvey, a claimants attorney with Sherman Oaks, California-based Rowen, Gurvey & Win.

The cost “of a claim may not be as high because life expectancy is a lot lower, yet the value of the claim often needs to take into consideration the fact that there are increased needs for an older person and that person may not go back to work because of age,” Mr. Gurvey said.

“It’s a balancing act,” he said. “And those are decisions made by defendants in terms of putting reserves on a case.” 

 

 

 

The aging U.S. workforce is a rising concern for employers and workers compensation insurers as older worker injury claims are more likely to contain comorbidities. 

Older workers usually have greater expertise than younger co-workers and are injured less frequently but they often have more preexisting health issues than younger workers, making comp claims more complex. 

As life expectancy increases and people retire later, the average age of many workforces will likely continue to rise, making effective return-to-work programs and other strategies more important, experts say.

“We know that when you’re older, you tend to have more chances of having a comorbidity, you tend to have more chances of having another medical condition,” said Dennis Tierney, Norwalk, Connecticut-based national director of workers compensation claims for Marsh LLC.

Gallagher Bassett Services Inc. says its claim distribution by employee age closely mirrors the overall U.S. labor force and it projects that by 2032, workers aged 55 and over will likely generate around a quarter of all claims. 

Figures provided by the third-party administrator show that workers comp claimants aged 35 or older account for 61% of claim volume and 80% of all claim dollars. 

And the age of claimants is tied to increased claim costs, more lost workdays and lower claim closure rates, according to Gallagher Bassett. 

The U.S. Census Bureau projects that by 2030, one out of five U.S. residents will be older than 65, likely translating to more, and longer, participation in the labor force. And the Bureau of Labor Statistics has said it expects 96.5% growth in the labor market of workers 75 and older between 2020 and 2030. 

When older workers are injured and undergo tests such as imaging scans, underlying degenerative conditions can be uncovered, which can further complicate treatment and lead to questions over whether any of the discovered issues are work related, according to experts. 

Other age-related developments may also affect claims, said Judiann Romeo, Youngstown, Ohio-based assistant vice president of clinical operations for Sedgwick Claims Management Services Inc. 

“We have older workers with workers comp injuries that may have hearing difficulty, vision or ambulation issues, comorbidities such as diabetes or even lung issues,” she said. 

Comorbidities can have a direct effect on a work injury or hinder the healing process, Ms. Romeo said. Prescription medications used by injured workers for unrelated conditions can also hamper recovery, she said. 

In addition, older workers are more prone to injury from accidents such as falls, and bone fractures can take longer to heal, said Dr. Mary Capelli-Schellpfeffer, vice president and national medical director for Boston-based Liberty Mutual, Global Risk Solutions, Workers Compensation Claims. 

Recovery is also likely to be affected by underlying medical conditions that aren’t tied to employment, such as high blood pressure, diabetes and higher body mass index, she said.

Older workers may also require more physical therapy sessions than younger workers, and they might have to be out on total temporary disability for longer, she said. 

“The recovery period is going to be longer when it’s an older person,” said John Geaney, co-chair of the workers compensation practice at Mt. Laurel, New Jersey-based law firm Capehart Scatchard PA. “It’s going to be more difficult to perhaps get them back to baseline.”

Meanwhile, aging workers on the job site can pose a greater risk for employers, and it’s not unusual for some of these types of workers comp cases to end up in litigation, Mr. Geaney said (see related story).

Managing claims

Some insurers say managing aging worker claims should involve a team approach, ensuring that injured workers maintain a relationship with a primary care physician and that they stay on top of their overall health to help facilitate faster healing if they do become injured on the job. 

These types of claims might also require nurses and other specialists, as aging workers might need more, and enhanced, medical care, Dr. Capelli-Schellpfeffer said. 

Managing claims for older workers often involves a whole-body approach, as opposed to focusing attention exclusively on the specific work injury, said Jennifer Cogbill, Frisco, Texas-based senior vice president of GB Care, a division of Gallagher Bassett.

“Properly supporting injured workers holistically (in) the aging workforce is certainly an area of focus,” she said.

In managing these types of claims there is also an element of familiarity for older workers, as they may have had prior experience with workers compensation and understand the process better, said Matt Zender, Las Vegas-based senior vice president of workers compensation strategy at Amtrust Financial Services Inc.

Older workers know how to “work with doctors in a way that gets them back healthy,” Mr. Zender said.

 

 

 

 

Employer representatives say the Occupational Safety and Health Administration’s recently finalized walkaround rule that allows workers to designate someone from outside a company to participate in safety inspections could open the door for unscrupulous participants. 

Proponents, though, say the change — in the works for several years — will better protect workers when it goes into effect later this month. 

The U.S. Department of Labor in March announced that its final rule clarifying the rights of employees to authorize a representative or representatives to accompany an OSHA compliance officer during an inspection of their workplace was ready to be published in the Federal Register, the final step before implementation. 

The DOL contends the controversial change is “consistent” with federal law and that the Occupational Safety and Health Act gives the employer and employees the right to authorize a “representative,” or nonemployee, to accompany OSHA officials during a workplace inspection. 

For a nonemployee representative to accompany the OSHA compliance officer, they must be “reasonably necessary” to conduct an effective and thorough inspection, according to a statement issued by OSHA.

The agency’s inspectors “have the expertise and judgment necessary to maintain fair and orderly inspections and to determine, on an inspection-by-inspection basis, whether a third party will aid OSHA’s inspection,” an agency spokeswoman said in an email. 

OSHA inspections typically follow a safety-related incident — the agency inspects all incidents involving death — or a whistleblower report of unsafe conditions. Attorneys representing employers say the new rule could be problematic for businesses trying to keep inspections free of disruptions. 

The move is considered pro-union and pro-labor, in line with the current presidential administration, said John Ho, New York-based co-chair of the OSHA Workplace Safety Practice at Cozen O’Connor P.C. 

“Unions use different tactics to try to convince employees they need to protect their rights, and one of them is often safety concerns,” he said. 

“If an inspection comes along, you’ll get a union rep that’s not associated with the employer as this non-party or third-party representative during the walkaround, essentially gathering information to be used against the employer in a union campaign.” 

The American Federation of Government Employees said in a statement that the access will allow the union to participate in safety inspections and represents a “victory for workers.” 

“A national rep who works for AFGE can now be the representative and go on OSHA walkaround inspections. Before it could only be the health and safety officer or rep for the local union,” AFGE health and safety specialist Milly Rodriguez said in a statement. 

“It also means we can go on an inspection of a workplace where we do not yet represent the employees if they select an AFGE representative in an organizing campaign when we are working to represent the workers, for example,” she said. 

But unions aren’t the only parties interested in getting involved in OSHA inspections, according to legal experts (see related story below).

“A lot more third parties have an interest in getting into workplaces during OSHA inspections,” said Eric Conn, Washington-based founding partner of Conn Maciel Carey LLP.

“Plaintiffs attorneys, plaintiffs attorneys’ expert witnesses, disgruntled former employees, family members of an injured employee — all of those folks have tried over the years to get a wedge into the workplace,” he said. “This rule really blows the door open for them to get that kind of access.”

OSHA, though, in a statement announcing that the change would go into effect May 31, said it is “consistent with OSHA’s historic practice, the rule clarifies that a nonemployee representative may be reasonably necessary based upon skills, knowledge or experience.” 

Such expertise may include knowledge or experience with hazards or conditions in the workplace or similar workplaces, or language or communication skills to ensure an effective and thorough inspection, the agency said.

The agency spokeswoman further wrote that OSHA gives its inspectors “authority to resolve all disputes about the representative authorized by the employer and employees.”

Language barriers and employee intimidation during inspections are two factors that will be affected by the change, said Jessica Martinez, Los Angeles-based co-executive director of the National Council for Occupational Safety and Health, which supports the change. 

“The purpose is to improve the OSHA inspection process; gathering information from workers directly so that hazards can be identified and eliminated,” she said. “That should be the focus of this discussion, not what supposed liability employers might or might not face in the … inspection process.”

Adding a “trusted representative” will help inspectors get better, more accurate information about unsafe working conditions, she said. 

Employers with cause for concern have an avenue to dispute the presence of a third party during an OSHA inspection, said Andrew C. Brought, a Kansas City, Missouri-based partner with Spencer Fane LLP. 

“If I’m an employer and there’s a request for a third party to accompany the compliance officer, and I don’t believe that there’s a legitimate basis for that, I’m going to be more inclined to challenge that showing and then make them go through the process of getting an administrative warrant” to participate, he said. 

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Attorney involvement may lead to more suits

Employers may be more likely to face litigation and a difficult discovery process after an accident when the Occupational Safety and Health Administration’s revised walkaround rule comes into force this month, legal experts say. 

As lawsuits often follow a workplace incident, especially when a worker is killed, plaintiffs attorney participation in an OSHA inspection could create problems for employers, they say.

“Plaintiffs attorneys and their experts want to get involved and gain access shortly after an accident to start to develop their personal injury and wrongful death action against the employer,” said Eric Conn, Washington-based founding partner of Conn Maciel Carey LLP. 

The change makes it easier for them “to get that access that they would never have under the existing rules of civil procedure,” he said. 

Andrew C. Brought, a Kansas City, Missouri-based partner with Spencer Fane LLP, said that risk is real and that employers will need to be better equipped to manage inspections. 

“Companies and employers are going to need to carefully evaluate that there is a legitimate good-faith basis for why this third party has been requested to participate in an inspection,” he said.

The concern caught the attention of lawmakers in South Carolina, who are considering a bill that would “condemn and oppose” the change to federal workplace safety rules. H.R. 5361, introduced April 9, claims that the change infringes on private property rights of employers and violates the U.S. Constitution.

 

 

 

 

The death of a woman who was fatally injured while trying to retrieve a lost earbud from a conveyor belt while working at a golf cart manufacturing plant has raised concerns about increased workplace distractions.

The woman died March 9 after she was trapped in machinery at the Club Car LLC facility in Evans, Georgia. The incident is being investigated by the U.S. Occupational Safety and Health Administration. 

Safety experts say the incident highlights the need for employers to introduce additional rules and training to address the increased use of earbuds and other technology that can impair hearing at work.

Industries affected include construction, food production, manufacturing, transportation, delivery, utility work or any other job where awareness of surroundings or the ability to quickly communicate, is important, experts say. 

“You’re not going to have situational awareness when you’ve got music playing into your ears or if you’re talking on the phone with somebody,” said Don Enke, St. Louis-based vice president of risk services for Safety National Casualty Corp. 

OSHA offers advice on earbud use in construction (see box) but does not have a specific earbuds regulation. Most citations for safety violations related to the use of distracting technologies would be under its general duty clause, Mr. Enke said. 

Edwin Palmer, an attorney with Pittsburgh-based Burns White LLC, who represents employers in OSHA matters, said he is aware of more cases in which workers were injured due to their use of earbuds or other personal items that distracted them from job tasks requiring focus.  

Companies should ensure workers are not placed in a “potentially dangerous or hazardous situation” by engaging in distractions at work sites that “have a lot of activity,” Mr. Palmer said.  

While employees may be at fault for engaging in distracting activity including earbud use, injuries arising out of such situations will likely be compensable (see related story below).

The Georgia incident also highlights the issue of lockout/tagout procedures in industries such as manufacturing.

“You shouldn’t be interfacing with moving equipment, conveyors, without shutting it down and isolating energy sources,” Mr. Palmer said.  

A Risk & Insurance Management Society Inc. spokesman said that in food production and manufacturing it’s “common practice for organizations to have policies in place that prohibit workers … from using earphones and cellphones.” 

Prevention is key when trying to cut down on incidents involving distractions, such as workers using earbuds, because enforcement of safety policies can be more difficult, said John Geaney, co-chair of the workers compensation practice at Mt. Laurel, New Jersey-based law firm Capehart Scatchard PA. 

“You’ve got to have a safety program. You have to pursue it aggressively,” he said. 

John Lastella, Hauppauge, New York-based vice president of claims for third-party administrator Broadspire, a subsidiary of Crawford & Co., said many of his clients are updating employee manuals to prohibit distractions such as earbud use and offering training on the inherent dangers of these types of distractions. 

For example, the U.S. Postal Service has a policy permitting workers to use earbuds, but only in certain situations, a spokesman said.

Letter carriers, who cross streets and may deal with pets, aren’t permitted to use headphones while driving or on foot, and their use is prohibited near moving machinery, during oral business communications or while in contact with the public, he said. 

Earbuds are permitted for USPS employees whose duties are performed while seated or stationary but only when it doesn’t interfere with work or create a safety hazard, the spokesman said.  

Managers tasked with enforcement are required to perform “work practice observations on every employee,” he said, and USPS provides ongoing safety talks highlighting the importance of employee compliance.  

Enforcement of certain employer policies can be difficult, and in some cases distracted employees who violate policies would likely be compensated in the event of an injury claim, experts say.

Organizations should emphasize that workplace safety policies are for the benefit of workers and should not be viewed as a means of control, said Jeff Adelson, a partner with Irvine, California-based Bober, Peterson & Koby LLP, who represents employers in workers compensation cases.  

“It’s the right thing to do,” Mr. Adelson said. “You have a duty to keep your employees safe in the workplace.”

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Claim validity depends on misconduct

A workplace death arising from an employee’s contributory negligence is still likely to be considered a compensable injury in workers compensation, experts say. 

In a Georgia case involving the death of a worker who became caught in a conveyor while trying to locate a dropped earbud, the employee broke company policy prohibiting personal earbuds at work, according to several media reports, but this type of violation is unlikely to prevent a workers comp claim, said John Geaney, co-chair of the workers compensation practice at Mt. Laurel, New Jersey-based law firm Capehart Scatchard PA. 

The employer — Club Car LLC — did not respond to requests for comment.

“There’s no deliberate misconduct there, and it’s not reckless disregard either,” he said. “That was a freak accident.” 

One way a claim may be found noncompensable in some states is if an employee engages in “deliberate misconduct” that leads to an injury, Mr. Geaney said. 

An example of deliberate misconduct would be if a worker who is angry with his or her boss punched a wall and broke a hand. In such a case, the claim could be denied because the employee’s own deliberate action led to the injury. 

In California, employers could challenge a comp claim if an employee engages in “serious and willful misconduct,” said Jeff Adelson, a partner with Irvine-based Bober, Peterson & Koby LLP.

In such cases, claims can be reduced by one-half of the total workers comp benefits, Mr. Adelson said. This wouldn’t apply, however, in cases where the injury creates disability of 70% or more, he said.

“The employer has to have a clearly stated prohibition,” Mr. Adelson said of these cases. “The employer has to take some action to stop it if they see it.” 

 

 

 

 

 

Workers compensation bureau loss costs are decreasing, mostly due to changes in payroll used to calculate premiums, along with a continued decline in injury claim frequency, according to a report released Tuesday by the National Council on Compensation Insurance.

Workers comp costs have been increasing recently at a slower pace than wage inflation, resulting in decreased loss costs, the report says. Additionally, injury claim frequency has been decreasing “over a long period,” it says.

“Workers compensation average claim costs generally increase,” the report states. “However, in more recent years, these costs have not been increasing at the same pace as wages. Many factors can influence average claim costs, including price of services, utilization of services, safety training programs, loss control measures and the mix of businesses.”

Workers comp medical fee schedules continue to keep costs down, and decreasing emergency room visits and in-patient admissions per claim, along with changes in dispensing patterns from brand name to generic drugs, all contribute toward the moderate growth rate of medical severity, the report states.

The NCCI says medical inflation continues to be a top concern in the workers comp industry, and it’s monitoring shifts in medical services and other factors to better understand how the COVID-19 pandemic may have recently affected comp costs.