Best (and worst) of 2011: Workers comp

Workers compensation legislation in Illinois highlighted a year that saw a spate of reforms nationwide.

Illinois—considered to have one of the nation's most expensive workers comp systems—was one of several states that revised their workers comp laws in 2011.

According to said William Zachry, vp-risk management at Safeway Inc. in Pleasanton, Calif., observers are waiting to see whether Illinois' reforms—which include preferred provider networks for workers comp care and a 30% reduction in the state's medical fee schedule—will lower workers comp costs. “It has an opportunity, I think, to create significant savings for employers and not really reduce any of the benefits for injured workers,” he said.

NCCI Holdings Inc. chief economist Harry Shuford said a reported increase in workers comp claim frequency was one of 2011's worst developments.

In August, Boca Raton, Fla.-based NCCI reported that claims frequency climbed 3% between 2009 and 2010—the first such increase since 1997. The rating and research organization attributed the increase in part to modest employment growth last year, since recent hires tend to file more workers comp claims than their more established counterparts.

Mr. Shuford said the frequency increase was indicative of a “lackluster” year in workers comp.

“The bad news is there are not any great stories,” Mr. Shuford said. “The good news is there don't seem to be any bad stories.”