Cambridge, MA – Total costs per workers’ compensation claim and key components in Texas were stable from 2013 to 2018, masking offsetting changes within the period, according to a recent study by the Workers Compensation Research Institute (WCRI).
Total costs per claim in Texas were among the lowest of the 18 study states for 2016 claims with more than seven days of lost time at 36 months of maturity. Compared with the 18-state median, Texas was lower or typical for all key components.
Medical payments per claim declined more than 4 percent per year from 2015 to 2017 and were fairly stable from 2013 to 2015. In contrast, indemnity benefits per claim changed little from 2015 to 2018, after increasing 5 percent per year from 2013 to 2015.
Benefit delivery expenses per claim with expenses decreased more than 4 percent per year from 2015 to 2017, a change from the prior period when benefit delivery expenses had been increasing about 5 percent per year from 2013 to 2015. They rose nearly 6 percent in 2018.
“The recent Texas trends in cost components for claims were different from trends in many other study states,” said Ramona Tanabe, executive vice president and general counsel of WCRI. “Medical payments per claim decreased 4 percent per year in Texas from 2014 to 2017, whereas medical payments in most states were stable or growing. Indemnity benefits per claim in Texas were stable (decreasing slightly) from 2015 to 2018, while indemnity benefits per claim in all other states were either stable or growing during that period.”
The study, CompScope™ Benchmarks for Texas, 20th Edition, compared Texas with workers’ compensation systems in 17 other states. For the study, WCRI analyzed workers’ compensation claims with experience through 2019. The following are among the study’s other findings:
- Medical payments per claim were 14 percent lower than the 18-state median for 2016 claims with 36 months of experience.
- Texas was among the lowest of the study states for indemnity benefits per claim—31 percent lower than the median study state for 2016 claims with more than seven days of lost time at 36 months of experience.
- Permanent partial disability (PPD)/lump-sum payments per PPD/lump-sum claim were lowest in Texas among the study states — 52 percent lower than other PPD benefit system states. The main reasons for that result are that most lump-sum settlements are prohibited in Texas and liability for future medical benefits cannot be settled.
With many wondering what impact the coronavirus disease 2019 (COVID-19) will have on state workers’ compensation systems, Tanabe says, “That is currently unknown, but the CompScope™ studies will be a useful baseline to monitor the effects.”
The study was authored by Carol Telles.
Learn more or purchase a copy: WCRI: CompScope™ Benchmarks for Texas, 20th Edition