WCAN WCIRB California Workers Compensation – 2017

October 4, 2017 By JL Risk Management Consultants

WCAN WCIRB California Workers Comp Full Analysis (Great Charts)

The WCAN WCIRB California Analysis of Workers Comp consisted of many great charts. The WCAN (Workers Comp Action Network) provided a great link to a very thorough breakdown of everything you want to know about California Workers Compensation in 2017.

corona wcan wcirb california city picture

Corona CA Public Domain

The WCAN always provides a great summary. However, the California study at the WCIRB (Workers Compensation Insurance Rating Bureau) website contained a massive amount of information which no summary would do justice.

Please note the document is a rather large PDF file that may take some time to download. The WCAN summary is a one page document. WCAN appears often in articles on this website.

Even if you do not have California interests in Workers Comp, I heavily recommend downloading the WCIRB document. If you do not want to go over every chart, the last few pages of the study include a summary of each chart. These charts are priceless for a California Workers Comp presentation. The underlying data in Excel format can be found on page 3 in the link (page 1 of the body of the study).

A few of the highlights from the analysis are:

Business People WCAN WCIRB California Looking At Chart In White Board

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Chart 26 – Virginia, Louisiana, Alaska, and Delaware are more expensive for medical costs in indemnity claims.
Chart 29 – Opioid costs per 100 claims reduced by 2/3. Would any of the cost be due to cheaper/generic opioids/
Chart 31 – California has a very high ratio of unreported claims at the 12 month mark (cumulative trauma?)
Chart 36 – $1 of benefits cost 53 cents for delivery of that benefit (Wow!)
Chart 44 – The quick and dirty summary for California

Many charts cover other areas well. You may want to check out the other charts provided by the WCIRB.

I am often asked why do I cover California so extensively. California is one of the more complicated and expensive states for Workers Comp in the nation. The other main reason points to the Golden State often enacts laws and rules which other states consider using in their Workers Comp regulations.

The WCAN WCIRB California analysis should be updated in the coming months.

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California’s Workers Compensation Difficulties – Great Primer

April 10, 2015 By JL Risk Management Consultants

California’s Workers Compensation Difficulties

California’s Workers Compensation difficulties may have subsided for a few years. However, it seems that it was only a temporary situation.

Workers Compensation Action Network (WCAN) recently responded to ProPublica’s and NPR’s analysis of Workers Comp in California. A recent responsive article was also published on this blog – In Defense of Workers Compensation.

I am often asked why I write a large number of articles on California’s Workers Compensation system. California is a leading bellwether of WC (of sorts). In other words, what happens in the state will likely become part of the WC environment in your location or states of operations.

The article actually turned out to be a great quick primer on quite a few developments in California over the last few years. One note is Propublica did meet with a few of the Workers Comp press and requested input on future WC subject matter.

Even if your company has not exposure in CA, I recommended reading the seven page analysis published by WCAN. They performed a yeoman’s job to bring together the article. Please note the response is a PDF file.

Hand Illustrating California's Workers Compensation Difficulties Chart

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Some of the statistics in the report are:

Premium rates in California are 30% higher than they were four years ago. That is a significant increase when many states are experiencing rate decreases.
Since 2004, average total benefits per claim in California have increased by 35%, or $18,000 per claim.
Average payments for medical benefits per claim increased by 40%.
Average indemnity (cash) benefits paid to injured workers increased by 27%.
Benefit costs did decline briefly after enactment of SB 899 (2004). However, this trend only lasted for three years and costs declined by only 17% before beginning to increase again in 2006.

When one looks at these statistics, California may not necessarily be in an “insurance crisis“, however the cost of covering workers is becoming even more of a significant budget burden on California employers.

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Claim Costs Effect on WC Insurance Rates – Great Graph

May 14, 2014 By JL Risk Management Consultants

Claim Costs Effect on Rates Direct and Delayed

The claim costs effect has a direct but delayed relationship on insurance rates.

California’s Workers Comp Action Network (WCAN) has produced a few great infographics over the last few weeks. The infographic shows how claim costs affect insurance rates. As posted in previous articles, Workers Comp is a delayed system where current costs affect future rates.

Graphic of California Map Claim Costs Effect States of America

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One can see on the graph that even though claim costs were increasing, the corresponding rates actually dropped in 2008 and 2009. In 2011, the claim costs leveled off at almost $75,000 per claim. However, the rates kept increasing afterward.

This is not a California WC system anomaly. Rating bureaus will often increase the rates in subsequent years to an increase in claim costs. The increases are often not immediate. The rates may not be increased across-the-board, but instead, focus in on certain classification codes.

Rates in California are among the nation’s highest. Hopefully, Senate Bill 863 will reduce costs. That has not necessarily been the case since its inception. SB 899 from ten years ago did reduce costs over time possibly due to the inception of MPN (Medical Provider Networks).

Medical provider networks remain a low-cost way to reduce Workers’ Comp costs and provide injured employees with the best of care.

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Workers Compensation Action Network (WCAN) – Great California Chart

April 29, 2014 By JL Risk Management Consultants

Workers Compensation Action Network

Workers Compensation Action Network (WCAN) produced another great graphic on the Workers Comp situation in California. Click here for the chart. Why do I try to point out most of the happenings on WC in CA? This is a WC system that is becoming prohibitively expensive for employers.Some of the same variables are present or growing in other states’ Workers Comp systems can be seen in California presently.The most startling number was the 41% medical cost increases in such a short time (2007- 2008 and 2011-2012). SB 863 may shorten the continuation on some of the increases.

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As pointed out often in these articles, California seems to be on the cutting edge quite often for any workers comp developments. What happens in CA may soon be coming to your state.

The trends that occur in CA seems to flow out into other states’ WC systems. That is why I try to point out any significant developments that occur in CA..

Sitting behind a desk and thinking that your Workers Comp related job will always be the same is just not going to work in today’s insurance and legal environment.

Workers Comp Action Network – California SB 863 – Great Infographic

April 21, 2014 By JL Risk Management Consultants

Workers Comp Action Network Produces Great SB 863 Infographic

The Workers Comp Action Network produces great summary charts for California work comp analysis. They have once again made the complicated much simpler with their great work.

Graphic Of Computer Screen Workers Comp Action Network With Analysis

WCAN (Workers Comp Action Network) has created the best explanation of the implementation and cost of California’s SB 863. You can find the infographic here. (Requires PDF reader).WCAN’s position is that if not all of SB 863 is after implementation the costs may end up outweighing the benefits. Nine of the 14 areas of SB 863 have been implemented overall. Three of the nine are on track for cost: savings. Those areas are:

Lien filing fees
Ambulatory Service Center fees
Spinal Hardware pass-through payments

There are three areas where costs have increased post SB 863:

Workload has tripled for IMR’s (Independent Medical Reviews)
Litigation
Permanent disability filings have increased 5% after SB 863 vs. the 1% forecast

It is highly recommended that you download the infographic. The infographic is the simplest analysis of SB 863 that I have seen to date. The link to the infograph has been provided at the top of this article. Upgrades to WordPress now allow the graphics/charts to be included in some of the articles.