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Mass. Worker’s Comp Rates Declined As Commonwealth Recovered From Recession

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Concludes The Workers Compensation Research Institute Study”CompScope™ Benchmarks for Massachusetts” 

The Workers Compensation Research Institute (WCRI), organized in Cambridge in 1983, is an independent, not-for-profit research organization dedicated to discussing the public policy issues involved in the nations various workers’ compensation systems. In a new on-line study, the WCRI takes a look at the state of the Massachusetts workers’ compensation system as part of its analysis of some 16 different states across the country and how they have fared in the aftermath of the Great Recession. Using over 60 different measures, the Institute measured the impact of the recession, legislative and regulatory reforms on states, like Massachusetts, amidst the growing medical cares costs within the workers’ compensation system.

In particular the study focuses on two central questions:

  • How does the performance of a state system compare with that of other states?
  • How is workers’ compensation system performance changing over time?

In addition, several other aspects the WCRI analyses in the report includes:

  • Time from injury to payor notice of injury and first indemnity payment
  • Average total cost per claim, average payment per claim for medical benefits, and average payments per claim for indemnity benefits and components (temporary disability benefits, permanent partial disability benefits, and lump-sum settlements)
  • Vocational rehabilitation use and costs
  • Benefit delivery expenses per claim and defense attorney involvement
  • Duration of temporary disability

“This 16-state study can help policymakers and other stakeholders in the system break down cost components and identify cost drivers in the Massachusetts workers’ compensation system during the early post-recession period and see how costs there compare with other study states,” said Ramona Tanabe, WCRI’s Deputy Director and Counsel.

 Overall, the study concludes that there was a decrease in total costs per claim in the Commonwealth, which reflects the state’s burgeoning recovery from the Great Recession. In contrast to that, the WCRI notes that the total costs per workers’ compensation claim rose 10 percent per year, on average, during the same time period in the years from 2007 to 2009.

Indemnity benefits per claim, representing the “largest component of overall workers’ compensation payments in the state, also decreased by 11 percent between 2009 and 2010.” The WCRI concludes that because unemployment in Massachusetts was less severe than in the rest of the country, injured workers here probably had more opportunities to return to work with their pre-injury employer than in other states with greater unemployment rates.

For those interested in obtaining a copy of CompScope™ Benchmarks for Massachusetts, 13th Edition, the price for non-WCRI members in $45.00. The electronic-only version can be ordered and downloaded here.