WCRI notes rising comp claims costs in most of the country

Indemnity benefits and medical costs per workers compensation claim grew in most states since 2021, according to research reports released Monday by the Workers Compensation Research Institute.

Examining cost trends across 18 states since 2018, representing more than 60% of claims costs nationwide, the median increase in overall costs per claim stood at 2.9%, with the highest increases in Arkansas, New Jersey, Kentucky, Minnesota and Pennsylvania.

While the pandemic saw modest fluctuations in costs, post-pandemic data showed notable increases in indemnity costs, in particular. The mean increase in income replacement for injured workers between 2021 and 2024 stood at 8.6%, with the highest increases in Kentucky, Iowa, Minnesota, Arkansas, Pennsylvania and Virginia. Indemnity costs dipped during the pandemic years after rising slightly since 2019.

The reports cited various reasons for cost increases, pegging the “persistent drivers” of these increases as longer durations of disability, lump-sum settlements, higher hospital outpatient and facility costs, and rises in benefit delivery expenses, including medical management costs and litigation.