Oregon Workers’ Comp Costs to Drop Sixth-Straight Year

September 11, 2018

Oregon employers next year will pay an average of $1.12 per $100 of payroll for workers’ compensation insurance, down from $1.23 in 2018, under a proposal by the Oregon Department of Consumer and Business Services.

This will mark the sixth year in a row that businesses will experience an average decrease in their workers’ comp costs. Those costs have steadily declined over the years because of Oregon’s long-running success in managing the workers’ comp system, according to DCBS.

“Everyone from employers and workers to insurers and government has played a role in making workplaces safer and keeping business costs low,” Cameron Smith, DCBS director, said in a statement. “As the numbers show, Oregon’s comprehensive approach continues to pay off.”

Employers’ cost for workers’ comp insurance covers the pure premium and insurer profit and expenses, plus the premium assessment. Employers also pay the Workers’ Benefit Fund assessment, which is a cents-per-hour-worked rate.

The pure premium rate – filed by a national rate-setting organization and approved by DCBS – is the base rate insurers use to determine how much employers must pay for medical claims and lost wages. Under DCBS’s proposal for next year, the pure premium would drop by an average 9.7 percent. In fact, the pure premium will have declined by an average of 40 percent during the 2013 to 2019 period.

Driving the average decrease in the pure premium are lower medical care costs and less severe claims. Underpinning the steady decline in pure premium are the successful efforts of the Workers’ Compensation Division, Oregon OSHA, the Workers’ Compensation Board and injured worker and small business advocacy services, according to according to DCBS.

Those programs are funded by the premium assessment.

Oregon’s workers’ compensation premium rates have ranked low nationally for many years. Oregon had the seventh least expensive rates in 2016, according to a biennial study conducted by DCBS. That was an improvement from Oregon’s ranking as the ninth least expensive state the last time the study was done, in 2014.

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