Average California workers’ compensation lost time losses fell immediately after legislative reforms in SB 863 took effect a decade ago, but then gradually increased until the pandemic hit, according to the a new study.
The California Workers’ Compensation Institute indicated that the increase put average compensable losses in claims across all valuation points for a 60-month injury above their post-reform lows with the latest older claims data – 72 months of accident year 2016 claims data still showing a reduction in loss rates after the 2012 reforms.
Using data from CWCI’s Claims Monitoring Application on nearly 570,000 indemnity claims for injuries that occurred in the 10-year span ending in December 2022, the study tracked average compensable losses of six, 12, 24, 36, 48, 60 and 72 months after injury. . It breaks down year-by-year results to identify growth trends.
In addition to average total losses, the study records average medical and indemnity payments at each level of development and compares loss payments for claims from five industry sectors and from different other regions of the state.
According to the CWCI study, the average total compensable losses during the first year of injury fell immediately after the 2012 reforms took effect but decreased in AY 2014 and began to increase in AY 2015, continuing to increase in AY 2020. 24-month average Loss payments decreased in AY 2016, then trended up through AY 2019, the most recent year for which 24 months of data are available.
For the first time in seven years, the six- and 12-month average payment losses fell slightly in AY 2021 (the second year of the pandemic) while the six-month payment in AY 2022 increased claim decreased slightly, so the average total loss in the first months after the damage has changed little since the pandemic began.
