Medical Costs for Injured Workers in Delaware Fell During Pandemic: WCRI Study

Changes in the availability of medical services during the pandemic was one of the drivers of Delaware workers’ compensation claims costs in 2020 and 2021.

A new study from the Workers Compensation Research Institute (WCRI) found that total costs per claim with more than seven days of lost time in Delaware decreased in 2020 and then increased in 2021, based on claims evaluated as of March 2022. The study found that changes in the availability of medical services and economic conditions were the main factors behind the 2020 and 2021 findings. Reforms enacted in 2014 also had an effect on medical claims, which WCRI reported on previously.

“In the early months of the pandemic, medical facilities were closed and hospitals stopped performing elective surgeries and surgical procedures. In addition, some workers with injuries may have avoided medical treatment due to stay-at-home orders and fear of contracting COVID-19 in a health care setting. Labor shortages, especially in the health care sector, may have hampered access to needed medical care in some areas,” explained Ramona Tanabe, WCRI president and chief executive officer.

This trend tracks with what WCRI has seen in other states.

At the same time, indemnity benefits per claim increased in Delaware during 2020-2021 at a faster rate that in prior years “due to growth in wages of workers with injuries and increases in duration of temporary disability,” according to the report. There was a shift in percentage of indemnity benefit claims from lower wage to higher wage workers, likely reflecting the uneven impact of the pandemic on different types of jobs, WCRI said.

The study, Trends in the Delaware Workers’ Compensation System, 2016–2021, authored by Evelina Radeva, is the third annual report examining the Delaware workers’ compensation benefit delivery system. The analysis covers total claim costs, medical payments, indemnity benefits, disability duration, benefit delivery expenses, and other metrics. It analyzes how these metrics of system performance have changed over time from 2016 to 2021 (at various claim maturities) with payments made through March 2022.

Among the study’s key findings:

• Changes in the components of total costs per claim in 2020–2021 may reflect the impact of the COVID-19 pandemic; these changes followed a long-term decrease in total costs per claim.
• Medical payments per claim decreased in 2020 and then increased in 2021, reflecting utilization changes during the pandemic; prices for professional services have been fairly stable since 2017.
• Wages of workers with injuries and duration of temporary disability increased in 2020 and 2021 following small changes in prior years.

The data used for this report exclude COVID-19 claims, for which the nature or cause of injury was COVID-19.

WCRI is an independent, not-for-profit research organization based in Cambridge, Massachusetts.