Workers’ Compensation by the numbers

The Workers’ Compensation Commission recently released its Annual Report for Fiscal Year 2014. The report, as is often the case with annual reports, is heavy on statistics and percentages, some of which are interesting to note and useful to consider.

The Commission trumpets that insurers, whether outside commercial concerns or self-insureds, reported a 19% drop in benefits paid between 2011 and 2014, which included the largest decline in average medical payments per claim among states that were studied. According to the Commission’s research, Illinois moved from being the highest state in per claim medical payments to a position near the national median. The Commission also reports that despite this decrease in medical payments, there did not appear to be an increase in medical procedures or treatment by medical provides to make up for the lost revenue. As far as another significant WC cost of doing business is concerned, Illinois also saw the largest decrease in premiums, moving from the fourth highest in the nation to the seventh.

Injuries and claims continue to trend downward for the most part, which would be attributable in part to the considerable loss of heavy industry, including coal mining, in the state over the course of the last two decades. The Commission estimates that approximately 3% of workers in Illinois suffer an injury each year, with only 1% losing time from work as a result.

As far as raw numbers are concerned, generally speaking the Commission estimates that there are approximately 200,000 injuries reported by employees to employers each year. Of those, employers report approximately 65,000 as having at least three days of lost time, and of those approximately 45,000 - 50,000 employees file formal claims with the Commission per year. Arbitrators issue between 3,000 – 4,000 decisions per year and dismiss another 5,000 per year. The remainder of clams are resolved by some form of settlement. Of the cases that are tried and an arbitrator’s decision issued, about 50% of them are appealed to the Commission. Of those, approximately 1,500 result in decisions issued by the Commission, 500 are settled and 100 are dismissed. Of Commission decisions rendered, approximately 25% are appealed to the circuit court with 250-300 decisions a year. The appellate court issues roughly 100 workers’ compensation decisions per year and the state supreme court an average of one decision a year. The specific number of new cases opened at the Commission was up slightly in FY 2014 (43,732) compared to 2013 (42,543), but down significantly from FY 2010 (50,854)

Obviously there can be numerous reasons to appeal an arbitrator’s decision, but significant relief by the Commission and beyond is often hard to achieve as history shows that the Commission most often affirms the arbitrator. If a Petitioner appeals in the hopes of obtaining higher benefits, 83% of their appeals do not result in higher benefits. Conversely, a Respondent appeals  in order to obtain an order for lower benefits, but 70% of those appeals do not result in lower benefits. With the “manifest weight of the evidence” standard required in judicial review, significant relief for either side beyond the Commission is even less likely. Penalties are awarded by arbitrators in 10% of expedited cases (19(b-1) and 19(b)) and 2% of regular cases while the Commission writes penalties in 5% of expedited cases and 2% of regular cases. Overall, that is less than 1% of all cases that are closed in a year.

And so it would appear that claims are down, loss costs (benefits) are down, medical payments  are down and insurance premiums are down, some of which is likely attributable to the 2011 amendments, although none of which are down as much as employers would like. Unfortunately some  of the decreases can be linked to the decline in industrial employment in Illinois.

Just some food for thought. Comments are welcomed.