Calif. workers compensation insurers costs up by $1B in 2011: Analysis

California workers compensation insurers' medical, indemnity and administrative expenses reached $12.48 billion for calendar year 2011, up from $11.2 billion the prior year, according to a California Workers' Compensation Institute bulletin.

The bulletin, released Tuesday, provides details on how that money was spent.

“Higher loss adjustment and defense payments accounted for half of the overall increase in insurer payments last year, as these expenditures climbed to nearly $2.6 billion,” up from $1.92 billion the prior year.

The analysis in the Oakland Calif.-based institute's bulletin is based on data from the San Francisco-based Workers' Compensation Insurance Rating Bureau. Among other things, the bulletin states that payments for medical care, including doctor and hospital fees, reached $3.96 billion, or 31.7% of insurer payments, in 2011. Indemnity payments also rose, topping $3 billion during 2011.

Insurers' direct earned premium, meanwhile, grew to $10.4 billion last year, up from $9.6 billion in 2010.