Switch back to WCC classic look

WorkCompCentral – Workers' Compensation Education, Courses, News and Information

Call or email us anytime
(805) 484-0333
Search Guide
Today is Sunday, August 02, 2015 -

Columns

Illinois: Expensive State for Workers' Comp?

  • State: Illinois
I was reading over the Illinois abstract on workers' comp from the Workers' Compensation Research Institute. Even though there was a supposed reform in Illinois over the last few years, the Workers Comp costs has remained high.  A quote from the press release:

"WCRI found that the 2006 price regulations had a short-term impact on the trend on medical payments per workers’ compensation claim. Medical payments per claim grew 2% from 2005 to 2006, following the direct impact of the new fee schedules. However, medical payments per claim increased an average of 9% per year after 2006. This was similar to the growth prior to the introduction of the 2006 fee schedule, which limited growth rates in the fee schedule rates to changes in the general consumer price index or CPI. The main driver of this post-reform growth was related to hospital inpatient and outpatient payments per claim."

A medical cost growth rate of  9% annually is not staggering when compared to California.  Illinois and California are both post-reform for Workers Comp.  I decided to look further into why there was such a sharp increase in medical benefits.

As I have posted very often, the way that workers' comp tabulations affect the experience modifications is as a very delayed system.  In other words, patience is a virtue as in the case of Illinois. According to the National Council on Compensation Insurance, Illinois' medical severity is actually decreasing since 2008.

The average medical cost for a claim in Illinois was approximately $4,000 more per claim than the countrywide average. This has been reduced to $0 in 2010 when compared to 2008. I am pointing this out as many companies want a risk manager or safety department to show immediate results. It just does not work that way.

The bottom line is the medical rates did grow in Illinois at 9%. They were growing steadily nationwide. The reforms are showing four years later as medical costs are decreasing. This is the same cycle as the experience modification for workers' compensation premiums.

James J. Moore is owner of J&L Risk Management Consultants in Raleigh, N.C. This column was reprinted with his permission from his Cut Comp Costs blog.



No Comments

Log in to post a comment

Close




Do not post libelous remarks. You are solely responsible for the postings you input. By posting here you agree to hold harmless and indemnify WorkCompCentral for any damages and actions your post may cause.

Opioids Special Report

Read a special report, "We're beating back opioids — now what?" written by Peter Rousmaniere, in cooperation with CompPharma.

The workers' compensation industry is at a turning point in treating chronic pain — the greatest injury response challenge of the industry since insurers first learned to manage exclusive remedy claims in the 1910s.

Download the Report!

Join us on July 28th for a FREE webinar discussing this special report. Register now!

Upcoming Events

  • Aug 7, 2015

    AWCP - CAAA Infiltrated: Their

    Have you ever wondered what they talk about at the CAAA Conventions? This mini conference covers …

  • Aug 18, 2015

    Medical Marijuana and Workers'

    This presentation will provide insight into what marijuana is, how it is used for medicinal purpos …

  • Aug 20, 2015

    NV Workers' Comp Conference

    Experts in a wide range of workers' compensation areas, including representatives from the Nevada …

  • Aug 23-26, 2015

    FWCI 70th Annual Conference an

    This year’s program offers creative and innovative speakers from throughout the United States. T …