​WCRI: Michigan Total Costs per Workers’ Compensation Claim Lowest of Study States; Rapid Increase in Indemnity Benefits per Claim in 2020 Likely Reflects Impact of COVID-19

Cambridge,MA,(WorkersCompensation.com) –Total costs per workers’ compensation claim in Michigan for non-COVID-19 claims in 2020 were stable, the result of offsetting factors, according to a new study from the Workers Compensation Research Institute (WCRI).

Although medical payments and benefit delivery expenses per claim decreased, there was rapid growth in indemnity benefits per claim, which was driven by increases in the average duration of temporary disability and average weekly wage of workers with injuries.

“The recent trends in indemnity benefits per claim may reflect changes in economic conditions, including the economic slowdown related to the COVID-19 pandemic,” said Ramona Tanabe, executive vice president and general counsel of WCRI. “Moreover, possible pandemic-related delays, including slowdowns in the dispute resolution process, may have also contributed to the recent trends in indemnity benefits per claim.”

The following are among the study’s other findings:

• Indemnity benefits per claim grew 10 percent in 2020, following little change from 2015 to 2019.
• Medical payments per claim in Michigan decreased 4 percent in 2020, which followed increases of about 4 percent per year from 2015 to 2019.
• Michigan total costs per claim were the lowest of the study states and Michigan was lower compared with other study states for all three key components—indemnity, medical, and benefit delivery expenses.

The 22nd edition of CompScope™ Benchmarks for Michigan provides ongoing annual monitoring of how indemnity benefits, medical payments, and benefit delivery expenses per claim in the state’s workers’ compensation system change over time, and how these metrics compare with 17 other states. This edition analyzes non-COVID-19 workers’ compensation claims with injury dates between 2015 and 2020 (evaluated as of March 31, 2021), so it provides a look at how the pandemic impacted non-COVID-19 workers’ compensation claims in the early months of the pandemic.

To learn more about this study or to purchase a copy, visit https://www.wcrinet.org/reports/compscope-benchmarks-for-michigan-22nd-edition. William Monnin-Browder is the author of the study.

About WCRI

The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Cambridge, MA. Organized in late 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts, which conform to recognized scientific methods. Objectivity is further ensured through rigorous, unbiased peer review procedures. WCRI's diverse membership includes employers; insurers; governmental entities; managed care companies; health care providers; insurance regulators; state labor organizations; and state administrative agencies in the U.S., Canada, Australia, and New Zealand.

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