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WCIRB Long Tail Medical Expenses – Great Study


WCIRB Long Tail Medical Expenses – 30 Year Study

The WCIRB Long Tail Medical Expenses Study was one of the better studies I have seen from them over the years.   The WCIRB of course, is Workers Compensation Insurance Rating Bureau- California’s Workers Comp Rating Bureau.

Picture of WCIRB Long Tail Medical Expenses Patient Giving Doctor Money

The study covered 30 years of claims tail data.   Yes, that is right, thirty years.  I often have discussion with actuaries concerning overvaluing the current data by using such studies as loss triangles, etc.   I am a fan of very long data tails as history repeats itself, even in the WC world.

The study can be found here.  Please note it is a .PDF file.   Kudos are appropriate for the Medical Analytics Director  (Dr.  Gregory Johnson) and his staff.

The study provided a  data in 14 pages.  This is one of the studies that I recommend reading completely if you are interested in Workers Comp data.

The main discovery is that in the area of Workers Comp medical expenses, California does not operate in a vacuum.  In fact, one of the major findings in the study and report is the similarities between NCCI (National Council on Compensation Insurance) and the WCIRB.

NCCI analyzes data on approximately 40 states- sometimes even if the state has its own independent bureau.  I found it interesting, yet ingenious  that the WCIRB would compare their data one-on-one with NCCI.

One hot topic now, of course, is the use or abuse of opioids.  The chart on page 12 of the study compares opioid use between California and the NCCI states as measured in RX payments.

Woman Consult WCIRB Long Tail Medical Expenses With Pharmacist
Wikipedia commons – Rhoda Baer

The similarities were almost unanimous except for:

  • California had a much higher use of Lidoderm   3.8% to 2.5% of NCCI prescription payments
  • The NCCI states had a much higher use of Hydrocodone 4.2% to 2.0%
  • California had a much higher use of Percocet and generic Percocet (Oxycodone) 4.3% to 1.9% 

The Hydrocodone/Percocet(Oxycodone) percentages almost offset each other exactly.

Two interesting conclusions drawn by the study were:

  • California medical treatment persists much longer than in NCCI states.  One astounding part of this conclusion is that claims are reported long after the date of accident or illness.  Risk Managers should be all over this statistic.
  • The three to six year period of the claims being open is critical in developing  the long tail medical treatment claims.  After six years, the claims shift from acute treatment to long-term care for aging processes.

There was no much more info in the study that I did not cover due to length.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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