Costs associated with catastrophic workplace injuries represent less that 0.1% of workers compensation claims but account for up to 2% of all costs to insurers, according to a report released Thursday by the National Council on Compensation Insurance.
Boca Raton, Florida-based NCCI worked with nine state ratings agencies to study so-called “mega claims,” examining 11,330 of them from accident years 2001 through 2021. All of those claims had incurred losses in excess of $2 million.
Such claims represent only one out of every 1,295 reported indemnity claims. Of those, 53% had costs between $2 million and $3 million, and 27% were between $3 million and $5 million. Fifteen percent were between $5 million and $10 million, and 4% were in excess of $10 million.
The report states that “some drivers related to the cost of mega claims include medical advances which improve patient outcomes and provide life-saving measures.”
Mega claim costs could also be influenced by innovative rehabilitation technology, such as robotics and virtual reality; rising home health care costs; extended recovery times; and inflationary trends on services not explicitly included in a state’s medical fee schedule, according to the report.
This article was first published in Business Insurance.
