WCRI Study: Illinois’ Cost per Workers’ Comp Claim Grew 1-3 Percent Annually

The average total cost per workers’ compensation claim in Illinois grew annually between 1 to 3 percent since 2012, according to a recent study by the Workers Compensation Research Institute.

The growth was due to small to moderate changes in medical payments per claim, indemnity benefits per claim, and benefit delivery expenses per claim, according to Ramona Tanabe, WCRI’s executive vice president and counsel.

The WCRI study, CompScope Benchmarks for Illinois, 18th Edition, compared Illinois with workers’ comp systems in 17 other states and found the average total cost per claim in Illinois remained higher than typical when compared with the other study states.

WCRI’s study evaluated Illinois claims data through March 31, 2017, for injury dates between 2011 and 2016, and in some cases used a longer time frame to supply historical context for key metrics and to monitor changes in Illinois’ workers’ comp system performance.

“Illinois’ results were higher than other study states on many metrics related to both medical payments and indemnity benefits. Illinois’ medical payments per workers’ compensation claim were driven by utilization of medical services and prices paid for these services while indemnity benefits per workers’ compensation claim reflected system features and processes related to permanent partial disability benefits and duration of temporary disability,” Tanabe said.

The study’s other findings include:

  • Indemnity benefits were the largest component of total costs per workers’ comp claim in Illinois, accounting for 45 percent of the total payments for 2014-2017, a timeframe that refers to claims with injuries dating back to Oct. 1, 2013, with experience through March 31, 2017.
  • One important component of indemnity benefits is the duration of temporary disability benefits. In 2014 (evaluated as of 2017), Illinois had a longer duration of temporary disability benefits than most other study states.
  • At 52 percent, Illinois had the highest rate of worker attorney involvement in workers’ comp claims among all the WCRI study states for 2014-2017 claims.

Visit the WCRI website for more information about this study or to purchase a copy.

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

This article was first published by Insurance Journal.

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