Report Highlights Decline in Health Care Costs in Texas WC System

Report Highlights Decline in Health Care Costs in Texas WC System

Overall health care costs in the Texas workers’ compensation system declined 30% between 2012 and 2022, according to a report from the Texas Department of Insurance, Division of Workers’ Compensation. These trends are most likely a result of a decrease in the total number of claims, as well as the implementation of evidence-based treatment guidelines, the pharmacy formulary, and the increased usage of certified health care networks. Total claims filed during the period decreased 20%.

The 2023 Health Care Cost and Utilization report uses administrative data reported by insurance carriers as of June 2023 for claims with injury dates or service dates from January 2012 through December 2022. It is intended to show trends over time and patterns across claim types, health care provider types, service types, claim maturities, facility types and drug types in the Texas workers’ compensation system.

According to the report, overall health care costs dropped from $1.15 billion in 2012 to $812 million in 2022. Total claims decreased 319,000 to 256,000 during the period, with the average cost per claim dropping 12%, from $3,611 to $3,169.

Other highlights include the following:

  • Total professional costs decreased 26%, from $657 million in 2012 to $483 million in 2022. Claims receiving professional services decreased 19%, from 301,000 to 244,000. The average cost for professional services declined 9%, from $2,181 per claim to $1,982. The cost of professional and hospital/institutional services in 2022 was 24% lower than the cost in 2012 using current prices, but was 41% lower if adjusted for inflation.
  • Total hospital/institutional costs decreased 20%, from $355 million in 2012 to $285 million in 2022. The number of claims receiving hospital/institutional services decreased 32%, from 90,000 to 62,000. The average cost for hospital/institutional services increased about 17%, from $3,932 per claim to $4,601 in 2022.
  • Pharmacy services costs decreased 71%, from $136 million in 2012 to $39 million in 2022. Claims receiving pharmacy services dropped 54%, from 150,000 to 69,000. The average cost of pharmacy services decreased 38%, from $908 to $563 per claim.

The report is available here.

Fatal Work Injuries Up in Texas and Nation

There were 578 fatal occupational injuries recorded in Texas in 2022, an 8% increase from 2021 (533), according to a report from the Texas Department of Insurance, Division of Workers’ Compensation.

The 578 fatalities represented an incident rate of fatalities in Texas of 4.3 per 100,000 full-time employees (FTE) in 2022, a slight increase from 4.2 per 100,000 FTE in 2021.

Nationally, there were 5,486 fatal work injuries recorded in the United States in 2022, a 5.7% increase from 5,190 in 2021, according to the U.S. Bureau of Labor Statistics. The fatal work injury rate was 3.7 per 100,000 FTE workers, up from 3.6 per 100,000 FTE in 2021.

The transportation and warehousing industry (public and private sector) had the highest number of fatalities in Texas in 2022 with 184 incidents, up from 182 in 2021. The construction industry had the second-highest number of fatalities in 2022 with 141, an increase from 127 in 2021.

Those two industry sectors were also the top sectors nationally, according to BLS statistics. Nationally, workers in transportation and material moving occupations experienced 1,620 fatal work injuries in 2022 and represented the occupational group with the most fatalities. The next highest was construction and extraction workers with 1,056 fatalities, an 11% increase from 2021.

More information about fatal injury counts in Texas is available here.

National fatal injury counts and rates by occupation, industry, and worker demographics are available here.

OSHA Performance Challenges Identified in Report

The U.S. Occupational Safety and Health Administration (OSHA) continues to have problems verifying that safety hazards are abated in a timely manner, according to an annual report from the Department of Labor, Office of Inspector General.

Additionally, the report concludes OSHA is hampered by the lack of a permanent standard on infectious diseases aimed at protecting workers in high-risk industries, and also needs to address worksite violence.

The report notes OSHA did issue an emergency temporary standard during the COVID-19 pandemic that covered the health care industry only; however, the agency substantially withdrew the emergency temporary standard, retaining only its logging and recordkeeping provisions. The report says that without a permanent standard on infectious diseases, OSHA will not be able to effectively protect the safety and health of workers operating in high-risk industries during future pandemics or endemics.

Meanwhile, workplace violence has become the fourth-leading cause of death on the job and the fifth-leading cause of nonfatal injury resulting in days away from work in private industry. In 2021, nearly one in every seven work-related deaths was attributed to worksite violence, for a total of 761 — an increase from 705 in 2020.

Additionally, the report found OSHA has challenges performing inspections. A recent OIG audit identified that, on average, between 2016 and 2020, 59% of establishments in all industries failed to submit their mandatory annual injury and illness reports to OSHA. Additionally, OSHA could not identify if an establishment met the criteria for mandatory reporting and, therefore, could neither proactively remind specific establishments that they must report nor effectively cite employers for noncompliance.

The report is available here.

Study Examines Factors Affecting Recovery Outcomes

Mental health co-morbidities, such as anxiety, depression and sleep dysfunction, are more strongly correlated with poor recovery after injury than are physical health co-morbidities, such as diabetes, hypertension, and obesity. That’s according to a new report from the Workers Compensation Research Institute (WCRI).

The study, “Comorbidities and Recovery After Physical Therapy for Low Back Pain,” examines the prevalence of self-reported co-morbidities, assesses the association between self-reported co-morbidities and functional improvements, and identifies other important predictors of physical therapy outcomes.

Other key findings include:

  • Co-morbidities are common among injured workers, with the most prevalent being hypertension, arthritis, sleep dysfunction, depression, and anxiety or panic disorders.
  • Co-morbidities such as sleep dysfunction, severe obesity and kidney disease had stronger associations with smaller functional improvements.
  • Timeliness of provision of physical therapy services for low back pain is strongly related to improved functional outcomes.

These results are based on a large sample of 68,850 workers who were injured on the job and received physical therapy for low back pain. The data were prospectively collected by Focus on Therapeutic Outcomes (FOTO) from low back pain patients at their first and last physical therapy visit over the 2017-2021 period. The data included information on patient-reported functional outcomes, patient-level sociodemographics, self-reported co-morbidities, and other characteristics.

Information on purchasing or downloading the report is available at

Duration of Temporary Disability Benefits Focus of NCCI Report

Of the most common injuries seen in workers’ compensation claims, shoulder injuries have the longest average duration of temporary disability benefits at 123 days, according to a new report from the National Council on Compensation Insurance (NCCI).

The report, “Workers Compensation Temporary Disability Benefit Duration — A First Look,” is the first in what NCCI says will be a series examining workers’ compensation temporary disabilities benefits. The first report examines all temporary disability benefits, which includes both temporary total disability and temporary partial disability benefits.

Nervous system claims, which include injuries such as quadriplegia, are relatively rare, accounting for 0.06% of all temporary disability benefit claims, but are severe when they do occur, averaging 264 days of temporary disability. However, 62.3% of nervous system claims are actively receiving temporary disability benefit payments 365 days after the initial accident, indicating that the average will continue to increase as the available data matures.

Other key insights include the following:

  • The average duration of temporary disability benefits increases with age, although the rate of increase slows down after 40.
  • The construction and utilities sector has the longest average duration of all the economic sectors.

The report uses data as reported in NCCI’s Indemnity Data Call (IDC), which has more detailed benefit payment information than previously available data sources but is currently limited in claim maturity. As such, this report evaluates temporary disability duration as of 12 months. For context, at the 12-month maturity, 96.7% of all temporary disability claims have gone more than seven days without receiving a benefit payment, indicating that a significant share of claimants have returned to work or are receiving permanent disability benefits within 12 months of the accident date.

The report is available here.

Proposed Rule Change for Determining Joint Employer Is Delayed

The National Labor Relations Board (NLRB) has delayed the effective date for its new rule on joint employer status to allow time for legal challenges against the new rule to be heard. The new rule originally was to be effective Dec. 26, 2023, but its effective date has been delayed to Feb. 26, 2024.

The NLRB said it extended the effective date to “facilitate resolution of legal challenges with respect to the rule.” The new rule would replace one adopted in 2020, when the NLRB was under Republican leadership, and imposed a stricter test for determining joint employers. The new rule was announced in October and immediately challenged in court by a coalition of business groups, including the U.S. Chamber of Commerce.

The new standard makes it easier for two businesses to be deemed a joint employer of a group of employees, making each business legally liable for one another’s actions. Additionally, if one of the joint employer’s workers are covered by a union, both joint employers must bargain with the unions representing the workers they oversee.

The rule could make it easier for more workers to unionize at big companies such as McDonald’s or Amazon, the Associated Press reported, if their independent contractors or franchisees employ union workers.

The new rule is available here.

The business coalition lawsuit filing is available here.

Worker Shortage Grows

Businesses across the United States are struggling to find workers to fill available jobs. In Texas, the U.S. Bureau of Labor Statistics (BLS) reported in November that there were 811,000 job openings, but only about 650,000 unemployed workers. Nationally, there are 8.7 million job openings in the U.S., but only 6.3 million unemployed workers.

Several factors are contributing to the shortage. The number of people in the civilian workforce who are working or actively looking for work — the labor force participation rate — has been falling for years. It currently stands at 62.7%, down from 63.3% in February 2020 and 67.2% in January 2021.

Additionally, in the years since the COVID-19 pandemic, more workers are unwilling to take jobs that require them to work on-site the entire time. According to a U.S. Chamber of Commerce survey conducted in 2022, 66% of Americans who lost their full-time job during the pandemic say they are only somewhat active or not very active at all in searching for a new job. Of those, 49% are not willing to take jobs that do not offer the opportunity for remote work. Other factors cited in the survey include:

  • Nearly one in five has altered their livelihood, 17% have retired, 19% have transitioned to homemaker, and 14% are now working part time.
  • Almost a quarter (24%) say government aid packages during the pandemic incented them not to actively look for work.

The pandemic also exacerbated a problem with a lack of access to affordable childcare. With affordable childcare harder to find, many working mothers left the workforce. According to the U.S. Chamber of Commerce, about 3.5 million women left the workforce in the spring of 2020, dropping the labor force participation rate for women to 55%, from 70%.

Toxic Bosses in the Workplace

Two out of three American workers surveyed say they have experienced working for a toxic boss, with 31% saying their current boss is toxic.

A significant number of employees (66%) with toxic bosses plan to quit as soon as the economy allows, a sentiment shared by half of all millennials. Surprisingly, despite the severe consequences, toxic bosses are not only tolerated but also promoted, with 60% of American workers witnessing their ascent in leadership roles despite their toxicity.

According to the survey from The Harris Poll, many American employers display toxic behaviors such as setting unreasonable expectations (51%), micromanaging (49%), and credit-stealing (48%).

The survey found Americans endure toxic work environments primarily due to financial reasons (72%) and convenience factors such as proximity to home and fixed work schedules (72%). The uncertain economic climate (73%) also forces many to endure toxic bosses, taking a toll on their productivity, performance and personal lives. More than half of those with toxic bosses admit to having nightmares about them (53%).

The anxiety stemming from toxic bosses is extensive, with 73% experiencing weekend anxiety about returning to work on Mondays. Additionally, 41% have sought therapy to cope with the toxicity of their current or past bosses.

The survey was conducted online by The Harris Poll from Sept. 1-3, 2023, among a nationally representative sample of 1,233 employed U.S. adults. This research comprises 134 Gen Zers (ages 18-25), 512 millennials (ages 26-41), 393 Gen Xers (ages 42-57), and 194 boomers (ages 58 and older). It is available here.

Survey Suggests Areas Where AI May Change Workplace

Almost a quarter of the U.K. and U.S. workforce spends half their working day (three to four hours) on nonproductive manual tasks that could easily be automated, according to a report from a leading provider of advanced artificial intelligence (AI).

According to the report, mundane tasks such as searching or gathering information consume roughly 19% (1.8 hours) of an employee’s day. Additionally, workers report other areas where advanced AI technology could improve efficiencies by reducing human efforts and enabling better experiences.

Nearly four out of five workers (78%) surveyed in the U.S. and U.K. say access to the right technology and wanting to do challenging and stimulating work (71%) are most crucial to their job fulfillment. However, the current workplace technology is more of a hindrance than a help, workers surveyed in the Employee Experience Benchmark Report 2023 from say. At least one in three (31%) rate the legacy tools they use daily as “average” or “bad” in terms of ease of use, streamlining, and simplifying their workload. This poor experience only aggravates users, with disapproval ratings rising to 48% for finance and 45% for HR tools. The survey was conducted among 2,000 white-collar office workers across the U.K. and U.S.

Currently, workers report they are held back by nonproductive microtasks that they want off their to-do lists and put in the hands of automation. These include:

  • Raising invoices or purchase orders — 48%
  • Finding information or documents — 47%
  • Raising an IT ticket or getting status updates — 47%
  • Basic HR requests (e.g., holiday or pay questions) — 45%

A study from McKinsey Global Institute predicted that generative AI combined with AI-powered tools would be able to automate 30% of hours worked today by 2030.

The report is available here.

Program Helps Businesses Address Substance Abuse and Recovery by Workers

An estimated 26.9 million Americans aged 18 and older had a substance abuse disorder in 2021, and 20.9 million of those (77%) were employed full-time, according to statistics from the U.S. Office of National Drug Control Policy (ONDCP). To help employers respond more effectively to substance use among employees, build their workforces through hiring of people in recovery, and develop a recovery-supportive workplace culture, ONDCP recently issued its Recovery Ready Workplace Toolkit.

ONDCP also released model legislation to support the establishment of recovery-ready workplaces.

According to the National Safety Council, workers in recovery miss almost 14 fewer days of work each year than workers with an untreated substance use disorder and miss the fewest days overall, with 3.6 fewer days than the average employee. Employers avoid $8,175 in turnover, replacement and health care costs for each worker in active recovery when compared to the costs associated with an employee with an untreated substance abuse disorder.

The ONDCP suggests employers can reduce the risk of an employee developing a substance abuse disorder by considering the following:

  • Examine how opioids are used to treat pain under health and workers’ compensation plans, especially for work-related injuries.
  • Assess whether a lack of medical or disability leave creates an unintentional incentive to use opioids to return to work quickly after an injury.
  • Identify and address social factors that can increase the risk of substance misuse, such as excessive or unpredictable work hours.

The model legislation would establish a program by which employers can become recovery-ready workplace participants or certified as recovery-ready workplaces. It is available here.

The Recovery Ready Workplace Toolkit is available here.

Tips to Prepare Your Business for Winter

Winter can have harsh consequences for organizations that aren’t prepared. Below are tips from the Texas Department of Insurance (TDI) and Chubb, the leading commercial lines insurer in the U.S., on how to prepare for the season.

How to prepare property and equipment for cold weather:

  • Restore or provide heat to buildings to maintain a minimum temperature of 40°F.
  • Ensure all doors, windows, skylights, ventilators and shafts are weather-tight to prevent cold air from entering.
  • Repair roof leaks and remove tree branches that could fall on structures during a storm.
  • Leave all water taps slightly open and continuously dripping. Allow heated air to reach pipes by opening cabinet doors beneath kitchen and bathroom sinks or other areas with indoor plumbing.
  • If using a space heater, use electric space heaters with automatic shut-off switches and nonglowing elements. Keep away from flammable materials such as curtains or blankets.
  • Ensure the electric space heater cord is not a tripping hazard, but never place it under a carpet or rug.
  • Avoid using extension cords with a space heater.

Prepare walking surfaces:

  • Provide moisture-absorbent mats, rugs or runners at building entrances to reduce wet and slippery floors. Have caution signage available.
  • Clear storm drains of debris to minimize the risk of runoff water ponding.
  • Mark and identify concrete tire stops, fire hydrants, and landscaped islands in parking areas. When snow-covered, these pose an unseen and dangerous trip and fall hazard.

Protecting building equipment:

  • Inspect all emergency power sources such as generators to ensure proper operation.
  • Use only heavy-duty, outdoor-rated extension cords to plug appliances into a generator.
  • Inspect emergency heating systems to ensure proper operation.
  • Ensure all temporary heaters are UL listed and fitted with automatic high-temperature and tip-over shut-off devices.
  • Ensure idle cooling equipment such as cooling coils, chillers, and compressors are drained and/or installed in areas with heat. Cooling equipment operating year-round must have operating and de-icing procedures implemented to prevent freeze-ups and ice damage.

Prepare fire protection systems:

  • Provide 24-hour security with hourly fire watch rounds while electrical power is off.
  • Verify that sprinkler system water gongs and fire department connections are self-draining.
  • All wet sprinkler systems, wet standpipe systems, and other protective systems with piping located in areas that are subject to freezing and cannot be adequately heated or heat traced should be shut off, drained, and tagged.
  • Remove any water accumulation from a dry pipe valve system through all low point drains, hose headers, fire pump headers, priming water drains, or valve pits.
  • Conduct specific gravity testing for all antifreeze-containing pipes and/or equipment.
  • Test and inspect all low-temperature alarm devices.
  • Where sprinkler systems have frozen, close the main valve before thawing the system to prevent water damage if pipes/fittings have cracked.

More advice from Chubb is available here.

More advice from TDI is available here.

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