Important takeaways from four studies

Study: California Workers' Compensation Institute (CWCI), California Workers' Comp COVID-19 Death Claims: Trends and Characteristics

Findings: COVID-related deaths were the leading cause of workplace fatalities in California during the first 18 months (Jan. 1, 2020 - June 30, 2021) of the pandemic. The 1,032 COVID death claims reported represented more than half (53.4%) of the 1,931 workers' compensation death claims recorded. While most claims have not involved a fatality, the fatality rate for COVID claims is six times higher than non-COVID claims. The report also examines occupational, demographic, and geographical trends.

Takeaway: While most COVID claims have been inexpensive, the report underscores the extent of the new risk. The need for COVID-related risk management has not gone away.

Study: NCCI Insights, Is Inflation Back?

Findings: Wages and medical care are the drivers of work comp costs. There is no strong evidence to suggest upward pressure on wages in general, much of the recent wage growth has been concentrated in low-wage positions and new hires in service sectors, including leisure and hospitality. Further, most wage gains came in the form of one-time hiring bonuses, which signals employers are trying to attract workers without having to commit to a permanent higher wage. Authors note wage growth should see a trajectory in 2022 that is more aligned with historical data.

On the other hand, increases in the price for physician care and hospital outpatient care will impact workers' compensation in 2021. These increases are tied to changes in the Centers for Medicare & Medicaid Services (CMS) rules rather than general inflationary effects or the pandemic. States that have fee schedules related to Medicare reimbursement rates will likely see a rise in medical claim costs. Further, the removal of some musculoskeletal-related services from the inpatient-only list will accelerate the trend of fast-growing outpatient medical expenditures. To the extent that outpatient care remains less expensive than inpatient care, this move can still reduce medical expenditures.

The report also addresses the drivers of the CPI.

Takeaway: Inflation matters for workers compensation when it affects wages and medical care costs. Although wage growth has fluctuated during the pandemic, overall growth has matched the pre-pandemic trend. However, the PPI for health care services has increased by 4.3% at an annualized rate since December 2020. It is difficult to say how these changes will affect medical prices and workers' compensation beyond 2021 as they are a result of rule changes and not general inflation.

Study: American Journal of Industrial Medicine, Review of cannabis reimbursement by workers' compensation insurance in the U.S. and Canada

Findings: 36 states and the District of Columbia have approved laws that make cannabis available to consumers with qualifying medical conditions. Only six (Connecticut, Minnesota, New Hampshire, New Jersey, New Mexico, and New York) expressly allow cannabis reimbursement in workers' comp. In three of those states, New Hampshire, New Jersey, and New York, reimbursements were ordered by the courts earlier this year. Six (Florida, Maine, Massachusetts, North Dakota, Ohio, and Washington) expressly prohibit it, and in all other jurisdictions, the law is either silent on the issue or insurers are "not required" to reimburse employees. The study describes the role of the insurer, treating physician, and worker in obtaining WCI reimbursement in the six states that expressly allow cannabis WCI reimbursement.

Takeaway: This is a fluid and shifting landscape. Employers should stay abreast of case law and changing legislation.

Study: Workers' Compensation Research Institute, Outcomes Associated with Manual Therapy for Workers with Non-Chronic Low Back Pain

Findings: Early manual therapy (MT) for injured workers with lower back pain is associated with lower utilization of medical services, lower medical and indemnity payments, and shorter disability. The average indemnity payment per claim was 28% lower when manual therapy was initiated early and the average temporary disability duration per claim was 22% shorter for workers with such early treatment. The study focuses on low back pain claims in 28 states that did not have surgery but received MT and other medical services provided by non-chiropractic providers.

Takeaway: Back pain is one of the leading causes of workplace disability. Recurrent pain adversely affects productivity, motivation, and mental health as well as healthcare and comp costs. Employee education, proper training, and evidenced-based care are the most important elements in combatting the issue.