July 8, 2020

A New Routine: The Growth of Complex Claims and How to Manage Them

Industry stakeholders in all areas of workers’ comp – from employers to insurance brokers, claims adjusters to executive leaders – are concerned about increasing claims complexity with over 65% citing it as a top challenge in our recent survey.1

Although the overall number of claims continues to decrease nationwide, more routine claims are escalating and taking longer to close at higher costs. According to the National Council on Compensation Insurance (NCCI), from 2014 – 2018 lost-time claim severity increased by 3.4% and medical claim severity increased by 2.9%.2

CAUSES AND CONSEQUENCES

The reasons that claims are becoming more difficult to process and conclude are somewhat complicated in themselves. Poor worker health and chronic conditions, such as obesity, hypertension, and diabetes, along with psychosocial factors, such as anxiety and depression, troubled home life, and inability to cope with the challenges of an injury, can significantly affect an injured worker’s recovery. And the impact of comorbidities has been well documented, including findings that claims with comorbidities have medical costs that are double those of similar claims without a comorbidity diagnosis.3

Comorbidities and psychosocial issues are not new, of course, but their prevalence in workers’ comp has grown, largely due to the changing workforce population. The U.S. workforce is getting older. By 2024, nearly 25% of workers will be over 55,4 accounting for the largest segment of the workforce, and approximately 80% of those are likely to have at least one chronic condition.5

At the same time, millennials (aged 23-38) currently make up the largest segment of the workforce and they are more likely to experience anxiety and depression.6 Add to those demographic shifts the combination of widespread legislation mandating coverage for mental health exposures, a range of social and economic ills, from the opioid crisis to inadequate group health insurance, and changing medical trends, including a shift to other potentially risky drugs for pain relief, such as NSAIDs and anticonvulsants, and the result is a higher percentage of complex claims.

This article explores just how exactly claims are growing more complex, along with strategies to anticipate and mitigate some of those risks. Read the article in full at RxInformer.

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