Long-term care provider claim costs on the rise: Aon
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General and professional liability claims costs for long-term care providers are projected to increase by 6% next year, according to the findings of an analysis issued Tuesday by Aon PLC.
The Aon 2018 General and Professional Liability Benchmark for Long Term Care Providers analyzed data from 13 states and estimates ultimate loss rates, or the cost of liability for skilled nursing providers on a per-bed basis. The projected national 2019 loss rate is estimated to be $2,410, meaning that a skilled nursing facility with 100 occupied beds can expect approximately $241,000 in liability expenses in 2019.
The survey found that liability costs varied widely from a countrywide average estimated loss rate per bed of $2,270. Of the 13 states studied, liability outcomes in 2018 were the highest in West Virginia, where the loss rate per bed was estimated to be $8,270. Liability outcomes in Massachusetts, by contrast, were slightly below $500, the lowest in the survey.
West Virginia also posted the highest claim severity among the states surveyed, while Texas had the lowest.
The survey also examined the effect of arbitration in settling liability claims. The use of arbitration is on the upswing, the study found: Of claims closed between 2015 and 2017, 63% on average had an arbitration agreement in place compared with an average of 51% between 2008 and 2014.
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