LOUISIANA WORKERS’ COMPENSATION COSTS GREW AT DOUBLE-DIGIT RATES, FASTEST GROWTH AMONG 16 STATES IN RECENT YEARS

CAMBRIDGE, MA, December 20, 2011 – Workers’ compensation costs per claim for Louisiana grew at a double-digit rate in recent years, the fastest growth among all states in a new study by Cambridge, Mass.-based Workers Compensation Research Institute (WCRI). 

The 16-state study, CompScope™ Benchmarks for Louisiana, 12^th Edition, reported that costs per claim rose 11 percent per year from 2007 to 2009 with increases involved in all key cost components — medical, indemnity (payments for lost wages), and expenses per claim. 

WCRI speculated that this rapid growth may reflect some impact from the recession, although it noted that the recession’s effects appear to have been less severe in Louisiana than in other states in part due to the post-Hurricane Katrina recovery. 

The study said that indemnity benefits per claim rose nearly 11 percent per year in Louisiana during the period, a faster growth rate than in other study states during these observable recession years.   

The main driver in the growth of indemnity benefits per claim was an increase in the average duration of temporary disability of nearly two weeks.

Medical payments per claim also grew faster in Louisiana during the period than in other study states — 26 percent compared to about 16 percent in the typical study state.  These costs were among the highest of the 16 study states, 14 percent higher than typical.   

The study noted that state officials and system stakeholders view medical treatment guidelines enacted in 2009 as a step toward possibly improving medical care for workers and reducing costs to employers and insurers. 

Another factor in the higher medical payments per claim is that Louisiana has the highest prescription payments per claim. 

Among other key findings, benefit delivery expenses per claim in the state were among the highest of the states studied, especially defenses attorney payments.  Louisiana also had higher-than-typical average medical cost containment expenses and medical-legal expenses.  

The Cambridge-based WCRI is recognized as a leader in providing high-quality, objective information about public policy issues involving workers' compensation systems. 

ABOUT WCRI: 

The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Cambridge, MA.  Since 1983, WCRI has been a catalyst for significant improvements in workers' compensation systems around the world with its objective, credible, and high-quality research.  WCRI's members include employers; insurers; governmental entities; managed care companies; health care providers; insurance regulators; state labor organizations; and state administrative agencies in the U.S., Canada, Australia and New Zealand.