Minn. Workers’ Comp Costs Flatten

After five years of decline, workers’ compensation costs in Minnesota leveled-off in 2000, according to a report released by the state’s Department of Labor and Industry (DLI).

The Workers’ Compensation System Report estimates the total cost per $100 of payroll remained $1.37 for both 1999 and 2000. This is down 45 percent from the 1989 through 1994 average of $2.51 and the lowest since costs were first eliminated in 1984. A combination of employer and insurer efforts and law changes in 1992 and 1995 produced major workers’ compensation cost reductions through most of the 1990s. These cost reductions are now having a more limited effect.

The purpose of the annual report is to inform policy discussions. It presents statistics about the state workers’ compensation system through 2000, and focuses on claims and costs, vocational rehabilitation, disputes and dispute resolution.

Other findings include:

There were 8.2 paid claims per 100 full-time workers in 1999, and 1.7 claims with cash benefits per 100 full-time workers in 1999 and 2000. Most claims had medical benefits only. Claim rates fell during most of the 1990s.

The average number of weeks of cash benefits per claimant increased by about 14 percent from 1998 through 2000.

Driven primarily by the increase in benefit duration, average cash benefits per claim increased 7 percent from 1998 through 2000.

Approximately 17 percent of claimants with cash benefits, injured in 2000 — about 5,300 individuals, received vocational rehabilitation services, an increase from 15 percent for 1997.

The percentage of claims with disputes, after peaking in 1991, declined rapidly in the early 1990s, and changed relatively little during 1995 through 2000.

The percentage of cash-benefit claims with claimant attorney fees decreased from 17 percent in 1991, to 12 percent in 2000.

For 2000, total attorney fees were roughly 16 percent of cash benefits and 6 percent of total workers’ compensation cost.

Topics Claims Workers' Compensation Minnesota