COVID19 and Workers’ Comp – top 10 takeaways

I’m in the midst of a survey of workers’ comp payers re the impact of COVID19; will update you as we get more information from more participants.

As always, responses are completely confidential and respondents receive a detailed survey report; a public version is also produced which is much less informative.

If you want to participate, please email HelenAtKingKnightDotCom.

I’ve spoken with a number of payers, vendors, and other stakeholders…for now, there are a lot more questions than answers. Here’s what I’m hearing:

  1. Frequency and claims numbers are way down – as in 20-40%. That’s not surprising as far fewer people are working, and those that are don’t want to go out on work comp as they want to keep their earnings coming.
  2. Companies with large offshore workforces – think India – are scrambling to get things working after widespread shutdowns and mandatory workplace closures. This is particularly problematic in document management, scanning and Key-From-Image operations as well as off-shored UR and case management (think Philippines)
  3. COVID claims are starting to come in, mostly from nursing home, medical and first-responder entities.
  4. Disability duration for current claims will likely increase as a) patients don’t want to or can’t access medical treatment; b) some treating physicians are postponing non-essential care and won’t see patients to give them RTW approval; and c; there aren’t jobs to go back to.
  5. On a closely related issue, some payers are (finally) fully embracing tele-services; PT, triage, medical visits, etc. Unfortunately, many slow-walked tele-services for years so they are not prepared to shift patients from on-site services to tele-services, thus contributing to longer disability duration and higher indemnity expense.
  6. Cash is king. Suppliers/service entities in tight cash positions and/or with significant leverage (lots of debt) are in a very tough place. These firms have been paying their debt expense with cash flow from ongoing operations; with new claims counts falling off a cliff cash flow is also way down.
  7. Conversely those companies with little to no debt are in relatively strong positions.  Look for these firms to snap up debt-heavy competitors.
  8. Sectors including PT, home health, transportation and translation are among those feeling the pressure.
  9. Individual industries – think energy, hospitality, healthcare, are showing markedly different impacts from COVID19 and other drivers. While premiums are holding steady for now (from a very small sample set), there will be a big drop in payroll for April which will reduce future premiums.
  10. Generally speaking, US P&C insurers’ statutory surplus is high (about $850 billion) and investment income is in good shape, altho as 23% of US P&C investments are in equities that could change.  Conversely, as most assets are in very secure bonds, the appreciation in bond prices – particularly for high quality bonds – will have a positive effect on surplus.

The key questions are:

How long will this last?  I’ll be posting on this tomorrow – or more accurately posting on why we don’t know and won’t for some time.

How much will COVID claims cost?

Will work comp end up with a large COVID19 exposure?



A COVID-free post!

By now you’re as sick tired of COVID as anyone, so today we’re not mentioning the thing that shall not be mentioned.

A few things of note that crossed my desk here at the Intergalactic HQ in Skaneateles NY…

The fine folks at IAIABC have developed a super helpful app that tells you what state workers comp departments/agencies are up and running, doing what things/delivering what services. Way to step up fast, Jen and team!

Also, members can download an issue brief on telemedicine here. Of note several states have emergency regs in place addressing telemedicine and related issues.

WCRI is reminding us that their 2010 study entitled “Recession, Fear of Job Loss, and Return to Work” by Richard A. Victor PhD and Bogdan Savych PhD is available here. Timely reading for these days when unemployment filings hit 3.3 million, 4.5 times higher than the previous record.

The issue voted “most likely to make workers’ comp adjusters go ballistic” is…air ambulance! Good news – MTI America’s Melissa Galea is leading a webinar on that topic; you can sign up at no cost here.   (MTI America is an HSA client)

Finally, for those concerned about supplies of mission-critical commodities, here’s an excellent way to ensure those commodities are only used when absolutely necessary.



COVID-19 quick hits

First – reminder that every April 1 I do my annual April Fool’s post. It usually catches a few folks…you’ve been warned!

Now, a few things of note that crossed my virtual desk.

Chloroquine as a treatment for COVID-19

You may have seen President Trump talking about a malaria medication…

Two news items hit this morning, one noting that a patient just died after taking a version of the chemical.

A very small study found outcomes for patients that took chloroquine were not different than outcomes for patients that received a placebo. Out of  30 patients, 15 patients got the malaria drug and 13 tested negative for the coronavirus after a week of treatment. 15 patients didn’t get hydroxychloroquine; 14 tested negative for the virus.

Last week the drug was touted extensively on Fox and the Glenn Beck Show, with that “science” based on an unpublished paper describing what happened to a handful of patients treated with the medication.

Read the link if you want to understand why the “science” was crap and the “conclusions” total bullshit.

Takeaway – this drug can be very dangerous, is far from proven effective, and current studies are too small and have other limitations that make it impossible to draw any firm conclusions regarding its efficacy and dangers.

US Infection trend

As of 9:35 am eastern March 25, there are 55,238 confirmed cases in the US and 802 COVID-19 related deaths. Caveat – the number of cases is almost certainly significantly higher (not enough tests available) as is the actual number of deaths.

Takeaway – we are nowhere near the peak of this pandemic…here in New York we have over 25,000 confirmed cases…3 in our town of 4,800 people.


are pretty much not going to happen.  NCCI’s annual confab will go virtual; more details on the free web-based event here. The date is May 12, 2020, and it kicks off at 1 pm ET.


Briotix Health has developed a free app to help we work-at-home folks prevent injuries and other nasty stuff. Info is here.

A link to the Virtual Office is here.


Workers’ comp and COVID-19, part 2

Workers’ comp is singularly ill-equipped to handle COVID-19…but some organizations are making solid progress

The industry’s antipathy towards change, resistance to anything smacking of risk, and rejection of most anything remotely “innovative” ensures many payers, vendors, regulators and other stakeholders won’t be able to handle the fallout from COVID-19.  Industry veterans know that any change is brutally hard, slow, and fulls of fits and starts; if there’s a business that struggles mightily to innovate its workers’ comp.

Few WC organizations will adapt quickly enough to keep pace. Executives get promoted for not making mistakes, for squeezing vendors, for cutting administrative expenses – not for innovating, taking risks, being creative. These “attributes” are exactly what organizations don’t need if they are to survive the next few months.  Example – many payers are viewing COVID-19 thru the lens of yesteryear, acting as if the future will be the same as the past.

It won’t be.

Covid-19 will change workers’ comp in ways that would have been incomprehensible just a week ago.

But some are moving quickly.

Two big insurers are suspending premium collection – a huge shout out to Chesapeake and BWC Ohio for leading the way. Kudos to the State Fund of California for suspending policy cancellations and penalties for late payments.

Others may follow…for good reason. Workers’ comp insurance has been very profitable of late and most insurers can afford to tap into cash reserves.

Tele-everything is exploding, albeit haphazardly. Regulators in many states are scrambling to enable/allow/legalize the use of telemedicine in its many forms. Vendors are struggling mightily to keep up with the patchwork of state-specific regulations which are different today than they were yesterday.  Payers that pooh-poohed the very idea of telemedicine, or slow-walked it, or had programs in name only are beating down vendors’ doors, demanding access to a service they gave short shrift to just a week ago.

Inevitably, mistakes will be made – what was OK yesterday isn’t going to be tomorrow, and program requirements, procedures, approval processes, and forms are all in a state of flux. This is where the IAIABC could be hugely helpful; The IA is uniquely positioned to bring regulators together to agree on a standard set of guidelines and regulations that should be adopted by each state. These should be fast-tracked because telemedicine will be critical to ensuring injured workers get the care they need.

Regulators and industry executives that ponder, debate, discuss, and dither will do harm to patients, providers, and policyholders alike. Of course there will be things they won’t like or that “won’t fit” – but now is not the time to argue, it is the time for action.

This does NOT mean employers and insurers shouldn’t embrace telemedicine and telerehab, just make sure you are working with vendors experienced in the space. Concentra is one, MedRisk (HSA consulting client) is another. Carisk (also HSA consulting client) is able to deliver services to their cat/complex patients via their proprietary application. The company is also providing access to behavioral health services via telepsych.

For those in the Independent Medical Exam space, you may be able to ply your trade remotely. Register for Chris Brigham’s webinar Working in the Virtual World – Practical Steps for the MedicoLegal Expert here.  It’s tomorrow, Wednesday March 25 at 3 pm eastern.

And for those of us in need of a refresher in coping skills – which includes pretty much all of us – register for David Vittoria’s terrific (and free) half-hour webinar Calm Amidst the Chaos: Taking Care of Ourselves & Others When Things are Stressful. Sign up here.


Why COVID-19 is different

An extremely experienced, knowledgeable, and successful executive who happens to be an attorney sent this yesterday – and with their permission, I’m sharing it with you.
It is particularly timely coming on the heels of yesterday’s webinar on the subject – and another piece in WorkCompCentral on applicant attorneys’ views.
From the executive:
I read this morning’s post with interest——if  WC insurers (erroneously) believe that they could arbitrarily deny those WC claims presented by workers who are (or will soon be) infected by COVID19 —those insurers will soon discover that the current pandemic situation and the related economic impact it is already bringing to our markets is REAL—and something that should be addressed with the greatest degree of care.
Here’s why:  If insurers haven’t yet understood….this pandemic is different.  This will change…everything.  And that includes the customary defenses and general traditional methodologies that WC insurers have used to deny or delay WC claims. 
The typical “within the course and scope of work” argument works in 95% of the claim scenarios where there may be a legitimate question of fact——it is not likely to work under situations created by a pandemic.  Service workers (such as those you listed in your post) have very little if any choice but to present themselves for work.
No show? No job.
So, the “social compact” between the employer and the employee changes—fundamentally.  If the worker must be at work — I’m thinking here of healthcare workers, (doctors, nurses, medical technologists, orderlies, nursing assistants, etc.) and they come in contact with an infected patient and become infected themselves——that contraction is in fact within the course and scope.
This pandemic is going to give us a new legal paradigm——the threshold for contact with an airborne pathogen is presenting a new qualifier.  The industry’s leaders are working from a very old, very tired circa 1980s-1990s mindset.  All the old arguments are completely useless.
There is something else for the insurers to think about—and this is what you were striking at in your blog:
If an insurer decides to “fight” the compensability issue——given the potential size of a class of workers that will be adversely affected—it may be a decision that will eventually lead to financial ruin for that insurer.
Yeah…this isn’t going to cut it any more.
Denial of the claims will surely lead to litigation.  With such a peculiarly large class of individuals involved (safe guess, in the hundreds of thousands before this is all over).  Inviting a wave of litigation will cost the insurer truckloads of defense costs (ALAE).  Those costs will lead to larger than necessary loss costs and settlements.  When the insurer eventually wakes up and sees the magnitude of the issue those attendant cost drivers will have already significantly adversely affected both the insurer’s loss ratios and reserves.
Those escalated costs will also negatively impact the loss experience of the policyholders—the employers.
Given enough backlash, policyholders will vote with their feet——rapidly.  The insurer will lose significant market share and revenue; lower revenue means less investment income.  Less investment income coupled with dramatically declining claim management performance and escalating loss payments……well… get the picture.
This is what is now known as “social inflation.”  The topic has been rising and gathering more attention in the industry—usually in other lines of business (more on that some other time).  We didn’t need a pandemic to figure out that there are certain types of losses—certain liability scenarios — that give rise to social backlash.  Other examples exist wherever we see egregious behavior by corporate ostriches:
  • the class action settlements in Monsanto’s Round-up claims——
  • Johnson & Johnson’s brazen defenses in the emerging talc powder class action claims…..coming on the tail of a cluster of very high punitive damage awards from juries in the initial individual claims.
What does this mean for you?
Hard charging defense—or denial of claims in WC just ain’t gonna cut it with this pandemic.  The world of risk has changed.  And COVID19 is here to prove just how much that change will impact the industry….and just about everything else.


Hey workers’ comp – stop the legal BS and do your part.

Yesterday’s WorkCompCentral featured an interview with an attorney discussing whether or not COVID-19 is a covered condition under North Carolina’s work comp regs.

Couldn’t figure out why the piece bothered me so much until I woke up this morning, where it had crystallized in my sleep-befogged brain.

The article was so BC (Before COVID-19). The world has fundamentally, dramatically, and permanently changed, and now is not the time to engage in academic and frankly dangerous discussion over what constitutes “occupational exposure to Novel Coronavirus.”

Because while this assuredly endless debate goes on, the US infection rate is doubling every 2.5 days, (it doubled overnight here in New York state) and workers will:

  • not get tested because they can’t afford it;
  • won’t stay home because they can’t afford to;
  • will therefore expose others to the virus, infecting more of us;
  • and won’t get treated, infecting even more people.

This is not the time to debate arcane points of law and precedent. This is the time for insurers, regulators, and employers to Do The Right Thing – which means treating COVID-19 infections as covered by workers’ comp for healthcare workers, first responders, hospitality staff, airline employees, and others who may have contracted the disease thru contact on the job.

Some insurers are saying they will investigate each case to determine whether a particular workers’ coronavirus/COVID-19 will be covered. Yeah, that was the right policy – before COVID-19 came along and may kill millions of Americans.

Today, it’s just nuts. Not only is it impossible, it’s irresponsible. The confirmed infection rate is growing logarithmically; unless these insurers hire a gazillion investigators they won’t finish these “investigations” for decades.  Meanwhile, those undiagnosed, untreated workers will infect others, and more people will die.

from Statista

Some states – California, Michigan, Pennsylvania among them – have moved quickly to address the issue albeit not always comprehensively. Other states must clearly and immediately ensure COVID-19 is a covered condition for broad categories of workers and jobs

Yes, following the law is important. Precedent is important. Principled debates are important. Advocating for your client is important.

Or rather, was important. 

Now, what is overwhelmingly more important is stopping the pandemic – and workers’ comp must do its part.

What does this mean for you?

Do NOT quibble, cite arcane legal theories or case law, hide behind legal opinions, or waste time discussing the legal niceties and complexities.

Just accept the claim and get the patient treated. You can afford it; insurers are flush with cash, have billions in surplus/excess reserves, and the vast majority of infected workers will recover at home at minimal cost.

And when this is over, you will know you did the right thing.


Covid-19 and workers’ comp

We are in the opening inning of the Covid-19 pandemic, so forecasting where this will end up is a fool’s game.

That said, we know and can confidently predict a couple things well worth considering.

Small business

A lot of small businesses will not survive. Retail, hospitality, restaurants, entertainment, sports-related venues and service providers, events centers are all empty or close to it. The many companies that support them, operate them, clean them, staff them, deliver services to them have little cash coming in. Unless they have major cash cushions or lots of untapped credit, these companies are in trouble.

Washington National Airport – think of baggage handlers, shops, cleaners, restaurants, drivers…

Current workers’ comp patients

Care delays – I’m hearing from a broad spectrum of healthcare providers that patients are not going to scheduled appointments or using related services. That’s not surprising; with guidance from many states to avoid non-essential travel and contact, people with medical issues are loathe to risk exposure to the coronavirus.

Over the near term, that bodes ill for the providers and the companies/services doing the scheduling and coordinating care.

Over the near term…

When things return to normal – which they will – there’s going to be a backlog of patients demanding appointments and medical care and transportation and imaging and therapy and surgery. So, the networks and providers will find themselves slammed with appointment requests.

The service companies’ challenge is to survive this big dip in demand – and the cash flow crunch that will inevitably follow – so they are ready when their services are needed. 

Increased disability duration

Those out of work due to an injury or illness may well be out of work longer than one might expect – especially if they are in energy production, airlines, services, retail, or hospitality. Their jobs may not be available until things get normal again, so we can expect disability duration, and associated indemnity costs, to increase over the near term.

More worrying is the current debt crisis – way too many families and businesses have way too much debt. They’ve been surviving on revolving credit that has been historically cheap. Mortgage interest levels are historically low, other consumer credit rates are as well, and lenders have thrown money at companies that never should have gotten thru their front doors.

(I wrote on this in detail back in October, here’s a quote:

The Feds are backing $7 trillion in mortgages, way more than they (us) did before the debt crisis of 2008. With taxpayers holding the bag, mortgage lenders have no reason to not give mortgages to people who can’t afford them to buy over-priced houses. The Feds then package those loans and sell them off to other investors.

In fact, fully half of new FHA mortgages consume more than half of the borrower’s monthly income.

Then there’s regular consumer debt; this from a post back in August of last year:

Consumer debt is really high right now, at 19% of income. When people lose their jobs, they default on their loans and credit card debt, cut back on purchases, and that will further harm retail, construction, durable goods (think washing machines and cars). It can take a long time for people to dig out of these holes, and when they finally do, they are very wary of spending – and absolutely hate debt.

As credit dries up – which will happen – folks with mortgages they can no longer afford and crushing credit card bills are going to do everything they can to keep the cash flowing.

That will likely translate into increased claim duration.

The good news is work comp insurers can afford this.  Insurers are flush with cash, have huge reserves, likely have benefited from the general increase in bond prices, and historically low combined ratios (claims plus admin expense divided by premiums)

What does this mean for you?

It is more important than ever to be clear-eyed and observe what’s going on outside workers’ comp. Because comp doesn’t affect the real world – the real world drives comp.


WCRI Day two quick takes

Your faithful reporter braincramped and left his laptop charger at home, so most of the session coverage will come next week after I translate my scribbling to pixels.

for now, posting via smartphone

Friday’s quick takes

– Inpatient facility costs average about 17% of total medical costs

– the average increase in inpatient payments was 7.2%; WI, VA, and IA’s increases were significantly greater

– the percentage of claims that had inpatient costs declined from 2012 to 2017, driven mostly by a reduction in surgical cases

– great talk on reoperation and readmission rates for lumbar surgery patients from Rebecca Yang PhD; the total 30 day readmit/reop rate is about 18%; Strikes me as very high…oh and you are paying for the re-dos.

more to come Monday.




Dr Vennela Thumula led off a panel discussing the latest research on changes in opioid prescribing in workers’ comp.

Many factors have contributed to the decline, PDMPs, changes in prescribing guidelines and enforcement via legislation, public education and workers’ comp drug formulary adoption are among the contributors.

Key takeaways from research looking at two time periods; 2014-2016 and 2016-2018.

Opioid use decreased in nearly all study states

The average volume of opioids dropped in almost all states too.

There was more use of non-opioid pain medications as opioid use decreased.

Finally, overall, fewer workers are getting pain meds these days, a positive outcome indeed.

Panelists discussed the information in depth an dove into specifics; Dr Albert Rielly of Mass General Hospital noted that at one point the number one cause of death for workers’ comp back patients receiving surgery was opioid poisoning. He also described a situation in Germany where a person was surprised when they didn’t get Vicodin after major dental surgery; ibuprofen was deemed enough. And, it was.

Dr Rielly rarely prescribes opioids to treat occupational injuries, and provided insights into alternative treatments for pain. He noted when one starts PT is key; it may not be appropriate to begin PT right away, just as it usually isn’t helpful to delay for several weeks.

John Christian, a practitioner who runs an assistance program for the construction trades in Massachusetts indicated there is good news and bad. Fewer patients are testing positive for inappropriate drugs, and the death rate for opioid overdoses has declined. The bad news is, opioid use may not be going down, rather there are fewer patients dying due to the increased availability of Narcan.

Mr Christian noted the death rate for opioid poisoning remains high; he also noted that massage and acupuncture is becoming more common among his patient population – and he’s a fan of cognitive behavioral therapy. The longer the patients are in treatment, the better the outcomes,

A somewhat-new problem is emerging – topicals intended to treat pain. Dr Thumula noted the use appears to be increasing, particularly in Illinois.  Nina McIlree MD of Zurich echoed Dr Thumula’s point, indicating Zurich is seeing more prescribing of dermatologics.  Pain kits have been growing as well; these are branded compounded kits that may include tape – plus over-the-counter medications to deliver those “medications”.

What’s coming…

Dr McIlree opined that we need to be watchful especially regarding invasive procedures, potentially inappropriate use of spinal cord stimulators, and the old favorite – epidural steroid injections.

Dr Rielly suggested prescribers need to focus on quality of life and functionality when speaking with a patient in pain, along with a quick determination of the efficacy of treatment, the idea being to stop doing stuff that isn’t working quickly and move to something that may help.

The key takeaway is that pain is a symptom, not a cause. Therefore if you don’t address the underlying issue, you’ll never be able to affect the pain…increasing opioid dosages, trying expensive and unproven novel treatments, wrapping limbs in fancy athletic tape all focus on the wrong thing.

What does this mean for you?

  • Opioid use is declining- and that is a very good thing.
  • Be really vigilant about “alternative treatments” with scant solid research backing up any claims.
  • Chronic pain management is difficult, time-consuming, often not linear, and requires a very long term commitment; these patients do not “get better” quickly.
  • Be patient and persistent – and don’t get discouraged.


Heading to WCRI – practice “safe conferencing”

Don’t be offended if handshakes aren’t offered and hugs avoided…it’s all part of “safe conferencing”, my name for the guidelines posted by the fine folk at WCRI.

Things kick off tomorrow, but most are getting in this afternoon – me included. I’m looking forward to the discussion of economic cycles and their impact on the labor market. Economists have been predicting a significant slowdown in growth for months and things are looking shakier due to the coronavirus’ impact on travel and supply chains. 

Here’s an excellent piece by one of the best news sources – The Economist – on how things will be different in the next recession than in past versions, and why.

And another from the Wharton School on the virus, how business is reacting to it’s many effects, and thoughts about long-term impact(s).

(I’ll be posting on this issue next week)

Got dinners, lunches, and breakfasts all confirmed, along with a cocktail catch-up or three.

Good to see colleagues aren’t over-reacting to the coronavirus thing.  Yes it’s a concern, but it is not a reason to stay home.