Indemnity benefits per workers compensation claim grew at a “rapid” pace of 6% or more in 2022 in 16 out of 17 states analyzed by the Workers Compensation Research Institute, which said data prior to 2021 showed little change.
Pegging the post-pandemic conditions as that which may have spurred the rise in indemnity benefits, WCRI said the tight labor market led to wage growth across the board, and increased the duration of temporary disability, which reflected “a growing share of new hires in the workforce and changes in comorbidities since the COVID-19 pandemic,” according to a statement on 14 research reports published Tuesday.
As highlighted by WCRI, Florida, Illinois, Michigan, Texas and Wisconsin reported nuances:
- Following two years of little change, Florida indemnity benefits per claim grew 12.9% in 2022, driven by a 9.5% increase in wages for workers with injuries and a 0.6-week increase in the average duration of temporary disability.
- Indemnity benefits per claim in Illinois increased 9% in 2022, driven by a 4% increase in wages for workers with injuries and a nearly one-week increase in the average duration of temporary disability.
- Indemnity benefits per claim grew 6% in Michigan in 2022, following four years of moderate growth. Indemnity benefits remained lower than in the typical study state, and Michigan’s overall costs per claim were the lowest of all study states.
- After a 4% decrease in 2021, 2022 saw Texas’s indemnity benefits grow by 6%, driven mainly by wage growth among workers with injuries.
Indemnity benefits per claim grew by 10% in Wisconsin in 2022, driven by 6% growth in wages and an increase of nearly one week in the average duration of temporary disability. Even with these increases, Wisconsin had some of the lowest indemnity benefits of the study states.
This article was first published in Business Insurance.
