The 20th edition of this study continues to monitor the effects of major legislation passed in 2011, House Bill (HB) 709. One key provision of that legislation capped temporary total disability benefits at 500 weeks (in most instances); previously, there was no duration limit on temporary total disability benefits. This report includes claims occurring up to slightly more than seven years after the income benefit provisions of HB 709 became effective, so it provides a look at changes in patterns of some indemnity components that could be related to those provisions.

New medical fee schedule rules became effective in 2015, with reimbursement based on a percentage of Medicare. Phased-in decreases in reimbursement for hospitals and ambulatory surgery centers (ASCs) went into effect beginning in April 2015, while changes in reimbursement for nonhospital (professional) services became effective in July 2015. Those changes are reflected in the medical data we report, up to 48 months of experience under the hospital and ASC fee schedules and up to 45 months of experience following implementation of the nonhospital fee schedule. Taken together, the income benefit provisions in HB 709 and the hospital fee schedule reductions targeted the key cost drivers in North Carolina — slower return to work (hence longer duration of temporary disability), larger lump-sum settlements, and higher payments for hospital outpatient care as compared with the typical study state.

This study benchmarks the performance of the North Carolina workers’ compensation system with 17 other study states, focusing on income benefits, overall medical payments, costs, use of benefits, duration of temporary disability, litigiousness, benefit delivery expenses, timeliness of payments, and other metrics. It also examines how these system performance metrics have changed primarily from 2013 to 2018. Claims with experience through 2019 for injuries up to and including 2018 were analyzed. In some cases, a longer time frame was used to supply historical context.

The report is designed to help policymakers and others benchmark state system performance or a company’s workers’ compensation program. It also provides an excellent baseline for tracking the effectiveness of policy changes and monitoring important trends, such as the impact of COVID-19.

CompScope™ Benchmarks for North Carolina, 20th Edition. Carol A. Telles. April 2020. WC-20-11.

Copyright: WCRI