Louisiana Workers' Compensation Costs Stabilize

Baton Rouge, LA (WorkersCompensation.com) - Workers' compensation costs per claim in Louisiana remained flat from 2011 to 2013 while other states' costs continued to increase, according to a new study by the Workers Compensation Research Institute (WCRI).

The WCRI CompScopeTM Benchmarks study compares the performance of state workers' compensation systems across 17 states with a focus on income benefits, medical payments, overall costs, benefit delivery systems, and many other measures associated with workers' compensation claims.

Overall costs per claim in Louisiana rose by only 0.1% per year from 2011 to 2013 after annual increases of 5.4% from 2008 to 2011, according to the study. Costs in several other states in the WCRI study increased by 4-6 percent per year through 2013. The study also found that medical costs decreased by an average of 1.4% per year since 2011 after increasing by an annual average of 4.7% during the three prior years.

The study notes that the medical treatment guidelines instituted by the Louisiana Workforce Commission in 2011 contributed to the results since 2011.

“Louisiana's rates were increasing up until our guidelines were implemented and we began a system that relies on doctors rather than lawyers and judges to make medical decisions about injured workers,” said Curt Eysink, executive director of the Louisiana Workforce Commission. “The turning point in cost containment in workers' compensation in Louisiana seems to coincide exactly with those game-changing reforms.”

The study found that indemnity benefits in Louisiana also flattened out since 2011 after annual average increases of 7 percent, despite increases in average wages, job growth in construction and high-risk industries, an aging workforce and an increase in settlements.

“The data is consistent with premium reductions proposed by the National Council on Compensation Insurance for the last two years, and shows that the recent changes in our state are working,” said Patrick Robinson, director of the Office of Workers' Compensation. “Updates to the medical treatment guidelines and implementation of a formulary for medications should continue that push. The ultimate goal is to reduce costs by providing better care for injured workers and getting them back on the job faster.”

Based on NCCI recommendations, the Louisiana Department of Insurance approved an average 5.1 percent premium rate reduction for new and renewal claims in May 2014 and another 2.4 percent reduction to take effect this month.

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