Workers' Comp Benefits Decline

Compared to wages, workers' compensation benefits payments and costs have declined for six consecutive years.

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Workers'' compensation benefits payments and costs declined relative to wages in 1997 and 1998, according to a report by the National Academy of Social Insurance (NASI).

In 1998, total workers'' comp benefit payments (medical care and cash benefits) were $41.7 billion. Employers paid $52.1 billion in premiums or to self-insure. Those figures for 1997 were $40.6 billion for payments and $52 billion in costs. Though the 1998 figures are slightly higher, when adjusted for the growing size of the work force and the rising wages of workers, the benefits and costs actually declined for the sixth straight year.

As a share of payroll, benefits declined by 35 percent from 1992 to 1998, from 1.66 to 1.08 percent of payroll. Employer costs fell by 38 percent between 1993 and 1998, from 2.17 to 1.35 percent of payroll.

According to John F. Burton Jr., a Rutgers University dean who oversees the NASI report, the declining costs likely were due to "fewer accidents, improvements in the operation of workers'' compensation programs, the active management of medical care, more effective return-to-work programs and tightening of eligibility for workers'' compensation benefits."

The full report, "Workers'' Compensation: Benefits, Coverage and Costs, 1997-1998, New Estimates," is available on the NASI Web site at www.nasi.org.

by Stephen G. Minter

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