State Report Cards for Workers’ Comp

Just Released: “State Report Cards for Workers’ Comp”,

based on newly available OSHA data



Work Loss Data Institute – 2/24/03



Corpus Christi, TX – A new study based on data from OSHA Form 200’s, covering all OSHA recordable injuries and illnesses, provides the basis for rating state-by-state workers’ compensation performance. The study, called State Report Cards for Workers’ Comp, was prepared by Work Loss Data Institute (WLDI) to help employers, insurers, TPA’s, state governments, and consultants answer the questions, “Who is doing well and why?”


As workers’ compensation costs begin their upward spiral again, it becomes increasingly important to identify those factors contributing to the cost increases, especially those that may be controlled. History has shown that there are major differences in costs from state to state. This report shows that during the year 2000 the ratio of workers’ compensation insurance costs from state to state was over 4 times from the highest cost state to the lowest cost state. These cost differences can play a major role in the competitiveness of companies operating in these states, and also on decisions to expand or relocate.

There are two major drivers of these workers’ compensation costs. The first is outcomes, specifically the success within a state in preventing injuries, and when they occur, their success in returning the injured worker to health and productive endeavor, thus avoiding prolonged absence and medical treatment costs. The second driver of these costs is administrative burden, sometimes referred to as the “friction” inherent in that states’ workers’ compensation system. “Friction” is the accumulation of rules, procedures, disputes, delays, discretionary charges and patterns of practice that press upon the resolution of claims. This report focuses on the first driver of costs, outcomes.

The WLDI report is based on the Survey of Occupational Injuries and Illnesses from the Bureau of Labor Statistics OSHA Form 200, for 2000, the most recent year for which complete state-by-state data is available. The Survey of OII, Form 200 and the latest Form 300 also serve in part as a foundation for Official Disability Guidelines, which is also published by Work Loss Data Institute. This OSHA database covers all OSHA recordable cases within those states in the program. For the year 2000 there were 44 participating states and territories, and 9 states did not participate. Among those states not participating for the year 2000 were Colorado, Idaho, Mississippi, New Hampshire, North Dakota, Ohio, Pennsylvania, South Dakota, and Wyoming.

In comparing outcomes, six key variables were looked at in depth for each state.

1) Incidence Rates. Good workers’ compensation outcomes start with prevention; proper attention to safety can minimize the chances of a claim ever happening in the first place. Specifically, WLDI looked at the incidence of claims involving days away from work for each state. The national incidence was 1.8 cases per 100 full-time workers. The rate varied from a low of 1.2 in Georgia to a high of 3.4 in West Virginia.

2) Cases Missing Work. When an injury happens, many cases do not require any time off from work and these cases place minimal burden on the system. WLDI looked at the total number of cases within each state, and calculated percent of total cases missing work. For the U.S. as a whole, 29% of OSHA recordable cases required time off from work. This percentage varied from a low of 22% in Iowa and Kansas to a high of 77% in Puerto Rico.

3) Median Disability Durations. When a case requires missed work, the longer the case is out the higher the indemnity costs. For the U.S. as a whole, the median disability duration in 2000 was 6 days. This varied from a low of 4 days in Georgia, Indiana, and Virginia to a high of 17 in Puerto Rico, The next highest are Texas at 10, and California and New York at 8 days.

4) Delayed Recovery Rate. A key driver of workers’ compensation costs is cases that fail to resolve in a relatively short period of time. The frequency of long term injuries has a huge impact on workers comp costs. For the total U.S., 21.0% of cases were out of work for 31 days or longer. This ranged from a low of 13.1% in Minnesota and 13.4% in Wisconsin, to highs of 34.9% in Puerto Rico and 31.8% in Texas.

5) Key Conditions: Low Back Strain. To investigate in depth the different variables in state-by-state workers’ compensation outcomes, the study analyzed each condition within each state. The OSHA BLS system, based on the OSHA Form 200, does not use the ICD9 diagnostic coding system, but Work Loss Data Institute has been able to convert the OSHA claims to an ICD9 based system, based on a combination of OSHA’s Nature of Injury codes and OSHA’s Body Part codes. Using ICD9 code, WLDI provides disability duration outcome information for every reportable condition in the U.S. for the year 2000, and then provides the same information for each of the 44 states and territories where data was available for the year 2000. WLDI lists the top 10 Workers Compensation Diagnoses for 2000, including Rank, ICD9 code, Condition, Cases, Medical Costs (Means and Medians), Lost Work Days (Means and Medians), Restricted Work Days (Means and Medians), and Average Number of Provider Visits. The number one condition is back sprains and strains (ICD9 847), resulting in over 333,000 cases in the U.S. with lost workdays in the year 2000. In addition to being the most common condition, this is also a condition with a great deal of variability, as shown by the difference between the median and the mean disability duration. In comparing state by state outcomes for back sprains and strains, the states with the best outcomes for back strain are Minnesota, Maine, Nebraska, and Iowa, and the worst states are Puerto Rico, New York, Texas, and California.

6) Key Conditions: Carpal Tunnel Syndrome. While not as common as low back sprains, carpal tunnel syndrome also has a significant impact on workers’ compensation costs. Among the most common workers’ comp conditions, carpal tunnel syndrome is ranked 9th in frequency according to this study, and it has the longest average disability durations among conditions in the top 10. In comparing state by state outcomes for carpal tunnel syndrome, the best states and territories for carpal tunnel syndrome are the Virgin Islands, Arkansas, Arizona and New Mexico, and the worst states are West Virginia, Louisiana, and Massachusetts.

Report Cards. In preparing an overall report card for each state WLDI looked at each of the above six key outcomes measures, and the state’s rank in that outcome. A low rank is good and a high one is bad. (A state ranking number 1 is the best in that category.) Then WLDI combined the six rankings for each state into an overall ranking, and assigned 5 grades – A, B, C, D, & F – based on where the overall ranking fell. Who got A’s? Nine states, including Georgia , Minnesota, Iowa, Nevada, Utah, Indiana, Arizona, Oregon, and Arkansas. Who flunked (got F’s)? Eight states and territories, including Puerto Rico, West Virginia, New York, California, Texas, New Jersey, Louisiana, and Rhode Island.

Following is a complete list of states and their grades.

Alabama (AL)
C

Kentucky (KY)
D

Oklahoma (OK)
D+

Alaska (AK)
B-

Louisiana (LA)
F

Oregon (OR)
A-

Arizona (AZ)
A

Maine (ME)
C

Puerto Rico (PR)
F

Arkansas (AR)
A-

Maryland (MD)
D

Rhode Island (RI)
F

California (CA)
F

Massachusetts (MA)
D-

South Carolina (SC)
C

Connecticut (CT)
B

Michigan (MI)
D+

Tennessee (TN)
B-

Delaware (DE)
D

Minnesota (MN)
A

Texas (TX)
F

Florida (FL)
B

Missouri (MO)
C

Utah (UT)
A

Georgia (GA)
A

Montana (MT)
C-

Vermont (VT)
C-

Guam (GU)
D-

Nebraska (NE)
B

Virgin Islands (VI)
C

Hawaii (HI)
D

Nevada (NV)
A

Virginia (VA)
C+

Illinois (IL)
D

New Jersey (NJ)
F

Washington (WA)
C

Indiana (IN)
A

New Mexico (NM)
B+

West Virginia (WV)
F

Iowa (IA)
A

New York (NY)
F

Wisconsin (WI)
B+

Kansas (KS)
B

North Carolina (NC)
B+





The 168-page WLDI special report, entitled State Report Cards for Workers’ Comp provides complete detail on all cases for participating states, based on all cases reported to OSHA for the year 2000. It is available in both electronic and hardcopy formats for $175 each.

Work Loss Data Institute is an independent database development company focused on workplace health and productivity, and publisher of Official Disability Guidelines and Employer Health Register.



To purchase the State Report Cards for Workers’ Comp ($175), visit www.disabilitydurations.com/specreportorder.htm, or contact WLDI at 800-488-5548 (760-753-9992).