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Workers' Comp Payments Shrink as Wages Increase.

Workers' compensation benefit payments and costs declined relative to wages in 1998 for the sixth consecutive year, according to a study by the Washington, D.C.-based National Academy of Social Insurance.

In 1998, total workers' comp payments for medical care and cash benefits for workers with job-related injuries or illnesses were $41.7 billion, costing employers $52.1 billion, compared with $40.6 billion at a cost to employers of $50 billion in 1997, according to the study.

"There are indications that calendar-year benefits may continue to rise in 1999, because the incurred losses were rising," said Daniel Mont, senior research associate and co-author of the study.

The cost to employers is the premiums paid to buy workers' comp insurance. When employers self-insure, costs are benefits plus administration, the academy said. Although the costs and benefits were slightly higher in 1998 than in 1997, when those costs are adjusted for the growing work force and wage increases, the benefits and costs continue to decline from their all-time highs in 1992 and 1993, according to the academy.

As a share of payroll, benefits declined 35% between 1992 and 1998 to 1.08%, from 1.66%.

The report, Workers' Compensation: Benefits, Coverage and Costs, 1997-1998, New Estimates, is the third in a series. The study provides estimates of workers' comp payments--cash and medical--for all 50 states, the District of Columbia and a few federal programs providing workers' comp benefits.

Without adjusting for the number of workers in each state, California led the country with the most workers' comp benefits paid in 1998 at $7.4 billion, followed by New York with $2.6 billion, Mont said. The District of Columbia had the lowest amount paid at $70.6 million, followed by South Dakota with $72.7 million, he said.

"Causes of the decline in benefits and costs probably include fewer accidents; improvements in the operation of workers' compensation programs; the active management of medical care; more effective return-to-work programs; and tightening of eligibility for workers' compensation benefits," John F. Burton Jr. of Rutgers University and chair of the study panel that oversees this project, said in a statement.
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Comment:Workers' Comp Payments Shrink as Wages Increase.
Publication:Best's Review
Article Type:Brief Article
Geographic Code:1USA
Date:Jul 1, 2000
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