Workers’ Comp Costs Per Claim Declined in Texas: Study

The average cost of a workers’ compensation claim in Texas declined recently, following several years of growth, according to a new study, Monitoring the Impact of Reforms and Recession in Texas, 13th Edition, by the Workers Compensation Research Institute (WCRI), an independent, not-for-profit research organization based in Cambridge, Massachusetts.

“The study will help policymakers and other stakeholders understand how the Texas workers’ compensation system measures up with other states, evaluate the impact of reforms, and serve as an invaluable tool in making system improvements,” said Ramona Tanabe, WCRI’s deputy director and counsel.

WCRI reported that costs per workers’ compensation claim in Texas fell 4 percent in 2010, a larger drop than in most of the states in the 16-state study. The decline came after three years of growth averaging 5 percent per year from 2006 to 2009.

The study found the cost of indemnity benefits—payments for lost wages of injured workers—decreased by 6 percent in 2010, driven mainly by a drop in the duration of temporary disability. The decline in duration may be related to recovery from the recession.

At the same time, the study found that medical payments per claim were fairly stable in 2010, dropping by 2 percent, despite growth in prices paid for non-hospital services.

The study observed that the period of growth in claim costs between 2006 and 2009 reflected the impact of reforms to the Texas workers’ compensation system, which became effective in 2006 and 2008, as well as the recession. Those reforms enacted a new medical fee schedule and increased indemnity benefits. The recession likely prolonged the period some workers received indemnity payments before returning to work.

For more information about this study or how to purchase it, click on the following link: http://www.wcrinet.org/result/bmcscope_multi13_TX_result.html.

Source: WCRI