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Jun
29

COVID’s impact – Work comp payers and service companies weigh in

If you really want to know what COVID is doing to workers’ comp, you have to hear from those on the front lines.

35 workers’ comp insurers, TPAs, state funds, self-administered employers, and service companies gave me their views on the impact of COVID19 and employment on their businesses, claims counts, costs – and how they are adapting to a very different climate.Quick takeaways:

  • COVID claim costs are pretty low, with just a handful of claims exceeding a few hundred thousand dollars.
  • Shutdowns/Lockdowns = drop in payroll + business closures -> premium decreases, delayed RTW 
  • Respondents see total claim counts dropping 20% for 2020
  • Tele-everything is growing rapidly, but still has a long way to go
  • Many filed claims are not accepted because:
    • patient does not have a positive COVID test
    • patient is asymptomatic
    • Employers tend to give workers exposed to COVID19 two weeks of paid leave; they become WC claims if/when medical care is needed to treat COVID
  • Presumption is a concern, but less so than it was a couple months ago

Winners and losers

Service companies with the following attributes are generally doing much better than their counterparts:

  • no or low debt service cost and
  • on-shored business functions that
  • provide services typically used later in the claim’s life e.g. pharmacy.

Here are more details – and your free copy of the summary report is here.

A comprehensive version of the report including respondents’ detailed statements (respondents are not identified) and the accompanying raw data is available for purchase; contact jpadudaAThealthstrategyassocDOTcom. (substitute symbols for capitalized letters)

What does this mean for you?

For workers’ comp, the economic fallout from COVID is far more significant than COVID itself.


Joe Paduda is the principal of Health Strategy Associates

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A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.

 

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