Broad metrics of worker’ compensation costs show that Virginia is a lower cost state, largely due to a lower frequency of claims, according to a new report.
But the report from the Workers Compensation Research Institute (WCRI) also found that the average cost of medical care per claim for injured workers in Virginia is among the highest among the 16 states included in the study.
When comparing Virginia broadly, WCRI said, insurance premium rates there were 32 percent lower than the median of the 50 states plus the District of Columbia. This reflects lower claim frequency in Virginia and higher-than-average cost per claim.
The average cost per worker in Virginia was 27 percent lower than the median of 46 jurisdictions — resulting from a somewhat higher average cost per claim but a lower frequency of claims per 100,000 workers.
The WCRI study said medical costs per claim with more than seven days of lost time in Virginia were 22 percent higher than the median of the 16 states in the study. The study found growth in medical costs per claim in Virginia was the main driver of the growth in overall costs per claim from 2004 to 2009, increasing an average of eight percent per year for the period.
Despite higher medical costs per claim, the overall costs per workers’ compensation claim in Virginia was close to the median of the study states, in part because fewer workers there had more than one week off work. As a result, cases in which workers received indemnity benefits — payments for lost wages — were less frequent.
The study also found that:
• The average lump-sum settlement per claim was lower than in most of the other wage-loss states.
• Vocational rehabilitation was used more often in Virginia than most of the other wage-loss states.
• Benefit delivery expenses per claim for medical cost containment services and litigation related activities were typical of the study states.
Source: The Workers Compensation Research Institute
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