Comp Claims Decline 15% in Santa Monica


Sacramento, CA - After three years of significant increases, workers' compensation claims fell 15 percent in the second half of last year, according to a recent report from the City of Santa Monica finance officials. The Santa Monica Daily Press reports that claim frequency remained relatively stable in most city departments but declined within the Big Blue Bus

The City has self insurance programs to provide for general liability, bus and automobile liability, and workers' compensation claims. California Cities Excess Liability (ACCEL), a joint powers authority of twelve medium-size California municipalities, is a member of the California State Association of Counties Excess Insurance Authority for the purpose of providing access to excess workers' compensation coverage for major employee injury risks through a program of pooled self-insurance/re-insurance and insurance on a risk sharing basis. The City retains self insurance up to $750,000 for workers' compensation. California State Association of Counties Excess Insurance Authority covers up to an additional $4,000,000 for workers' compensation and arranges for excess of workers' compensation over $5,000,000.

"The significant decline in claim frequency represents one of the few positive developments the city has experienced relative to workers' compensation for quite some time," city officials said in the report. "If this can be sustained while some of the cost control efforts discussed in the previous section take hold, the city has reason to be cautiously optimistic that workers' compensation costs will stabilize over the long-term. However, should normalization of claim growth not occur, the city should be prepared for continued increases in workers' compensation costs."

In the second half of last year, City Hall spent $3.8 million on medical treatment and indemnity payments for injured employees. Medical costs made up about $1.8 million of that. Fifty claims were settled in the back half of last year - compared to 47 in the back half of the year prior - totaling about $625,000. Over that time, the value of open claims jumped by $600,000 to $23.6 million. Santa Monica Police Department claims made up the largest portion of that total.

Eighteen members of the police department have undergone work-related surgery since July, more than double the previous year's total. A majority of the surgeries impacted sworn officers who get all of their pay while recovering, unlike non-sworn workers, who get two-thirds of their pay. Additionally, those absences have to be filled to maintain patrol staffing levels, so City Hall pays more in overtime. City officials think the bump in surgeries and longer recovery times are a result of an aging workforce - nearly 40 percent of the sworn officers are more than 45 years old.

City Hall spends a lot of money just litigating all of the claims so, in July of last year, they started a pilot program within the police department that incentivizes employees who forego attorneys. City officials cite a 2014 California Workers' Compensation Institute study that found that litigated claims cost $56,000 more to resolve than non-litigated ones. Seven fewer claims were litigated in the second half of last year when compared to the second half of the year prior, city official said. This, they say, could result in nearly $400,000 savings for City Hall.

Funding has been requested in the upcoming budget to bring the pilot program to the Fire Department.

City officials are continuing to place injured BBB workers in "light or modified duty" jobs while they recover. This, city officials said, increases City Hall's productivity. Additionally, they said, studies show that recovery times are longer for employees who stay at home to recover from injuries.

City officials are now putting bus driver job candidates through physical tests to be sure they can handle the work. Read More...

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