Massive New Study On Long Term Claims
NCCI has recently published what I would refer to as a very hybrid study of the long term medical costs on Workers Comp claims. Claims data is usually examined by NCCI, the WCIRB (CA Rating Bureau), and other rating bureaus with a corresponding time frame of just a few years.
The 35 jurisdictions for which NCCI provides ratemaking services are AK, AL, AR, AZ, CO, CT, DC, FL, GA, HI, IA, ID, IL, KS, KY, LA, MD, ME, MO, MS, MT, NE, NH, NM, NV, OK, OR, RI, SC, SD, TN, UT, VA, VT, and WV. The seven independent bureau states for which NCCI collects the Medical Data Call are IN, MA, MN, NC, NJ, NY, and WI.
The data time frame actually covered claims from the 1980’s and forward. The amount of data had to have been huge. One of the main quotes from the study, “It is likely that more than 10% of the cost of medical benefits for the workplace injuries that occur this year will be for services provided more than two decades into the future. That percentage has been growing and might continue to grow. ”
At first glance, that may seem to be an astounding figure until the complete Workers Comp landscape is examined including the very settlement- detrimental Medicare Set Asides. The settlement timeframes have been altered as paying upfront very heavily for medical services that may never be incurred has caused many carriers to not push for settling the clams on a full closure basis.
In other words, why pay upfront for an expense that may never occur? This paradigm shift was initiated by the CMS (Center for Medicaid/Medicare Services) having to approve many of the Workers Comp settlements. Many claim staffs had to shift their way of thinking on closing out large Workers Comp files.
One could have seen the growth of the long term medical files as claim adjusters started recommending leaving the medical portion of a file open forever for palliative care.
Two of the larger cost drivers for long term files were prescriptions and home health care services. Prescriptions were even seen as possibly in the future becoming 50% of the long term medical costs of older files.
One assumption negated by NCCI was that older workers were the ones that would be responsible for a large majority of the costs. This was proven as a fallacy as injured employees less than 60 years of age accounted for a very small portion of long term medical treatment costs.
The finding is in line with a study published last year by NCCI that proved older worker accident rates are much lower than younger workers.
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