June 11, 2024 Contact: Jerry Azevedo
(916) 475-2437
SACRAMENTO, Calif. – The Workers’ Compensation Action Network today released results from a new statewide survey in which a majority of California employers gave the state’s workers’ compensation a “poor” performance rating and reported they are experiencing increasing costs and growth in more complex, non-specific types of injury claims.
“This survey tells us that the on-the-ground experience of California employers is in sync with the trends we are seeing at the macro or ‘system’ level,” said WCAN spokesperson Jerry Azevedo. “After a long stretch of stability and moderating costs over the past decade, employers see the workers’ comp system as performing poorly as they contend with higher costs and an influx of more complex and challenging types of claims.”
Key findings of the survey of nearly 400 California employers include:
- Workers’ compensation was rated as a “top” or “significant” concern by most employers (78%). When compared to other employee management issues or challenges, workers’ compensation ranked fourth behind 1) compliance with California labor laws and mandates, 2) providing competitive pay and benefits, and 3) employee recruitment and hiring.
- When asked to select from three descriptions of system performance, half of employers selected the “performs poorly” description (50%), the lowest mark. Less than one in 10 employers selected the “performs well” description. Forty-two percent (42%) selected the “challenged, but adequate” description.
- Two-thirds (67%) of employers report their cost increased by more than 10% over the past year, and 30% report cost increases of more than 25%.
- When asked why their costs have increased, roughly one in five employers attributed cost increases to either increased payroll (19%) or more expensive claims (18%). However, nearly the same percentage saw cost increases even though their payroll and claims were stable (17%). Notably, employers who reported cost increases of more than 50% were twice as likely to attribute their cost increases to more expensive claims.
- When asked to rank 13 different system features on a scale of “poor” to “excellent” most employers rated these features as “poor.” The lowest-scoring features were 1) overall costs to employers, 2) ability to report and combat fraud, 3) cost and time needed to resolve disputes over medical treatment, 4) ability of employers to ensure claims are work-related, and 5) the fairness and consistency of legal rulings. Higher ratings were provided for medical care and benefits provided to injured workers, which were rated either “adequate” or “good” by a majority. Most employers rated ease of claim filing as either “good” or “excellent,” but no system feature was rated “excellent” by a majority.
- Most employers (85%) report that their overall amount or volume of claims is either stable or has increased or decreased only “somewhat.”
- Roughly half of employers report that their mix of claim type has changed. The most often reported change in claim mix was an increase in non-specific or “cumulative trauma” claims (27%), “post-term” claims filed after an employee has been terminated or separated (17%), and “presumption” claims that are not subject to traditional work causation standards (17%).
- A majority of employers (52%) have received cumulative trauma (CT) claims, characterized as injuries that develop over a prolonged time period and also referred to as “non-specific” claims. Among these employers, a majority report receiving CT claims from more than one worker, receiving multiple CT claims from the same worker, and seeing CT claims added to a prior, specific injury claim. A majority of these employers also report that CT claims are filed for the entire duration of employment (first day of work to last day of work), are filed by attorneys and not workers directly, and take more than three years to resolve.
Presentation of the slides of the survey results are available here.
