What’s Ahead For Workers’ CompensationWhat’s Ahead For Workers Compensation


Workers Compensation Trend

Understanding where workers compensation coverage is trending can be a vital piece of information to have in your risk management strategy. Workers compensation as part of your roofers insurance ensures that the injuries your employees incur on the job get paid for. This coverage also prevents you and your client from any worker involved liability.

Medical Costs

“The industry’s financial outlook is positive; however, the National Council for Compensation Insurance (NCCI) warns agents and brokers that the market exhibits “calm now, but turbulence ahead” in its annual “State of the Line” workers compensation market analysis. Among the factors challenging the Workers Compensation system are increasing medical costs, threats to the industry’s security systems and the changing nature of the workforce. However, many organizations are seeking solutions by leveraging technology to prevent injuries and identify and address high-risk claims.”

Compound Drugs

What experts point to as one of the major factors in the rise of health-care costs is compound drugs:

“In a survey conducted by consortium pharmacy benefit managers CompPharma, compound medications were cited by two-thirds of payers as one of their most pressing issues in Workers’ Comp pharmacy. “Compounds have a place in healthcare, there is no question—even in Workers Compensation,” says Brian Allen, vice president of government affairs for pharmacy benefit manager Helios, in Westerville, Ohio. ‘What we’re seeing, however, is prepackaged compounds that are being pushed as the first-line treatment, without really demonstrating a need for a compound.’ ”


The second cause of increase in medical expenses cited is hospitalizations and this seems to linked to the fact that many hospitals are buying up physicians’ practices and getting more negotiating power. Some facilities are charging double digit more than they did in the past.


In the past networks have been able to contain costs. However, in recent times networks have failed in this capacity. The study cites an example of a California networks. “Networks as a whole are not delivering the same degree of savings as they were in years gone by,” says Alex Swedlow, president of the California Workers Compensation Institute.

Complex Claims

In the past, one adjuster handled a workers’compensation claim. Due to the complexity of many claims today, legal/medical teams are formed to deal with a single claimant.With claims adjusters managing 120 to 180 claims per day on average, the job has become ever more complicated. Some insurers are seeking solutions in technology.

“Predictive modeling helps carriers understand which claims are at high- or near-term risk and need more managing,” says Jeffrey Austin White, director of innovation at Accident Fund Holdings Inc., a Lansing, Mich.-based writer of Workers Compensation insurance. “It provides the possibility of automatically prioritizing claims and then driving workflow items from it.”


More safety on the job seems to be the ultimate solution to the problem of increasing workers compensation costs. What the struggle seems to be is getting employers and workers to buy into the new behaviors needed to make that safe behavior a reality.