Massachusetts bureau proposes 2.7% comp rate hike

The Workers’ Compensation Rating and Inspection Bureau of Massachusetts is recommending a 2.7% increase in average rates effective July 1.

The recommendation includes a projected 2% annual increase in indemnity benefits, a 2.3% annual increase in lost-time medical benefits and a 2.8% annual increase in medical-only benefits. The bureau is also forecasting a decrease in claim frequency per worker week, including a 1.5% reduction for lost-time indemnity and medical claims and a 4% drop in medical-only claims.

Projections are based on data from policy years 2017 and 2018 rather than 2018 and 2019 to eliminate any distortions that could be caused by the impact of COVID-19, according to the agency.

For example, medical loss experience appears to be understated as a result of the ban on nonessential medical services for much of 2020 and the reluctance to seek out medical services to avoid exposure to hospital or clinical settings.

Mandatory shutdowns and stay-at-home orders appeared to result in fewer lost-time and medical-only claims and associated indemnity costs that would otherwise be expected, the WCRIB said.

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