Managing Costs Of The Aging Workforce In Workers’ Comp Claims

July 10, 2014

Problems arise in the workplace with aging employees, especially when the work involved requires physical stamina. The same can be said for those employees with pre-existing medical conditions, like diabetes or asthma. One way to manage the occurrence of workers’ compensation claims is to provide a number of alternatives for employees, measures that will act as preventative care.

Some companies determine the definition of aging by setting a certain age limit, depending on the type of work it can be as early as 35. While it has been shown that there are no greater instances of workers’ compensation claims in older workers, the cost of claims from aging workers is significant to companies. Implementing wellness programs that provide incentives for healthy behavior is one way to counter the aging or ailing of your workforce. Marsh has released a Risk Management Research Briefing that shows ways in which employers can counter the workers’ compensation costs for an aging workforce.

The cost to employers when older workers are injured can be much higher than when younger employees are injured. Obesity and other comorbidities common to older employees could also extend recovery times. But you can take action to reduce the frequency of injuries and help your employees remain fit and better able to recover following an injury.

In light of  our current challenges with MSAs, and the struggle we see with CMS acceptance in cases where co-morbidities and obesity complicate treatment and settlement, this article brings to light some interesting points.  Accidents in the elderly may be inevitable, but proactive steps taken now to create a healthier workforce at any age may result in significantly less severe accidents.  For Medicare beneficiaries, the financial ramifications could be significant.

NCCI Releases New Study on Effects of Obesity in Workers Comp

June 20, 2012

There is mounting evidence of obesity contributing to the cost of workers compensation. Longitudinal studies by Duke University of its own employees-and by Johns Hopkins University of employees of a multi-site U.S. aluminum manufacturing company-point to substantially higher odds of injury for workers in the highest obesity category. Further, a 2011 Gallup survey found that obese employees account for a disproportionately high number of missed workdays, thus causing a significant loss in economic output. Finally, earlier NCCI research of workers compensation claims found that claimants with a comorbidity code indicating obesity experience medical costs that are a multiple of what is observed for comparable non-obese claimants.

The study shows that, based on Temporary Total and Permanent Total indemnity benefit payments, the duration of obese claimants is more than five times the duration of non-obese claimants, after controlling for primary ICD-9 code, injury year, U.S. state, industry, gender, and age. When Permanent Partial benefits are counted toward indemnity benefit duration as well, this multiple climbs to more than six.

And if the statistics aren’t enough to encourage action, consider this….

Employee is a 54 yr old laborer working for a landscaping company.  He is 5’4″ tall and weighs 310 pounds.  In 2002, while walking on grass with a bucket of weeds, he tripped on a rock.   Injured worker treated conservatively for years for knee and back pain as he was too large for an MRI (even the open ones only take up to 300 pounds).  The doctors felt that the only option for treatment was knee replacement surgery, but injured worker was told his obesity precluded him from being a candidate – he needed to lose 100 pounds before surgery was feasible.

By 2004 injured worker was over 350 pounds and unable to work. Employer continued to pay both indemnity and medical.  At this point, employer authorized a weight loss program and also paid for gym membership and transport.  To be certain progress was being made, employer authorized surveillance.  Injured worker was photographed going to gym and sitting.

In February, 2011, injured worker had lapband surgery.  He lost 60 pounds in first 6  months  -at this point he is down to 250 lbs and  requires surgery to remove skin, but still 50 pounds to go before knee surgery can occur.

Injured worker is now 64 yrs old now, not able to work and still waiting for surgery…

This incredible story is also true, and one I’m sure many of us can repeat from our own experiences…. as we’ve all heard many times, “truth is stranger than fiction”.

As a Medicare Set Aside company, Tower MSA Partners is reminded everyday of the significant impact of obesity on future medical cost  (Duke University,”Obesity and Workers’ Compensation: Results from the Duke Health and Safety Surveillance System”, 2007,  lists mthe edical cost of obese patients as 6.8 times that of patients of recommended weight) .   We also see the impact of obesity on both the quality of life and the life expectancy of the Medicare beneficiary.  Taking it a step further, when one considers the strong relationship between high opioid narcotic use and the lifestyle changes that almost invaribly lead to obesity, we find yet another reason to work diligently to identify these combination triggers as early in the life of the claim as possible.

The free report is available from NCCI here: NCCI Study on Effect of Obesity in Workers Comp.