Workers’ compensation claims that result in no payment lead to millions of dollars in increased costs for employee group insurance plans, new research shows.
Nationwide, so-called “zero-cost” workers’ compensation claims could cost group health insurance plans more than $200 million per year, according to the study by Abay Asfaw, PhD, and colleagues of the National Institute for Occupational Safety and Health.
Asfaw’s study is in the December Journal of Occupational and Environmental Medicine, official publication of the American College of Occupational and Environmental Medicine (ACOEM).
The researchers analyzed data on more than 12,000 injured workers who filed for workers’ compensation benefits from 2002 through 2005. Sixteen percent of the claims were “zero-cost” claims—that is, they resulted in no payments.
Utilization and payments from the employees’ group health insurance increased after workers’ compensation claims for both zero-cost claims as well as claims resulting in payments.
But the zero-cost claims were associated with significantly greater increases in costs to group health insurance, after adjustment for other factors, according to the report. The increase was largest for outpatient care, with an estimated increase of approximately $400 per claim.
“Our national estimated showed that zero-cost workers’ compensation claims added $212 million in medical bills to group health insurance per year,” the researchers write. Because their data may miss some occupational injuries, they suspect the true economic impact is even higher.
The study adds to previous evidence suggesting that insurance other than workers’ compensation—including not only employee health plans but also public insurance—cover at least part of the costs of work-related injury and illnesses.
“If workers’ compensation provides inadequate coverage…workers will seek treatment using other insurance,” Asfaw and coauthors conclude. “Our key finding is that zero-cost workers’ compensation medical claims have repercussions for other insurance systems and society, and their economic implications are substantial.”
ACOEM is an international society of occupational physicians and other health care professionals.