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Calif. comp claim frequency hits 14-year high for private self-insureds

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The California Workers’ Compensation Institute reported that a rise in medical-only and indemnity claim volume in 2021 drove frequency for private self-insured employers to the highest level since 2007.

“Initial data on California workers’ comp private self-insureds’ calendar year 2021 claims experience shows total claim frequency rose nearly 6% last year, largely driven by a 9.6% jump in the incidence of medical-only claims, while average paid and incurred losses also rose, driving up private self-insureds’ first report total paid losses by $46.4 million, while first report total incurred losses increased by $97.4 million, according to a CWCI review of new data from the state,” the institute said in a bulletin published Friday.

Private self-insured employers reported a total of 93,430 claims in 2021 compared with 86,503 in 2020. With about 2.4 million workers covered by private self-insured employers, that translated to an overall claim frequency of 3.92 per 100 employees, up from 3.7 in 2020.

The rate of medical-only claims increased to 2.05 per 100 employees from 1.97 in 2020.

However, CWCI said medical-only claims fell to 43,779 when the pandemic hit in 2020, from 51,545 in 2019, so the rebound to 48,766 claims in 2021 is still below the pre-pandemic level.

CWCI reported that its review of first report claim volume over the past three years shows that since the pandemic declaration in 2020, much of the growth in private self-insured claims has been on indemnity claims: from 34,207 in 2019 to 44,664 in 2021.

“That has led to a shift in the distribution of private self-insured claim medical-only and indemnity claims since the pandemic began, as the number of indemnity claims per 100 employees rose from 1.47 in 2019 to 1.83 in 2020, then edged up to 1.87 in 2021, while the number of medical-only claims per 100 employees fell from 2.21 in 2019 to 1.87 in 2020 before rebounding to 2.05 last year,” CWCI said.

WorkCompCentral is a sister publication of Business Insurance. More stories here.