New Study Sheds Light on Attorney Involvement in Workers’ Comp Cases

New Study Sheds Light on Attorney Involvement in Workers’ Comp Cases

The Workers Compensation Research Institute (WCRI) in its recent study found a significant differential in the percentage of claims involving defense attorneys representing injured workers across 18 state Workers’ Compensation systems. The 18 states included in the study are Arkansas, California, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, New Jersey, North Carolina, Pennsylvania, Texas, Virginia, and Wisconsin. These states, according to the WCRI, were selected because they are geographically diverse, reflect a range of system features, and represent the range of states that are higher, near the middle, and lower on costs per claim.

The percentage of claims with worker attorneys ranged from 13-14% in Wisconsin and Texas to 49-52% in New Jersey and Illinois for 2013 claims with more than seven days of lost time and experience through March 2016. The median of the 18 states was at nearly 30%.

The study, Worker Attorney Involvement: A New Measure, indicates system features may be responsible for at least some of the interstate variation. The report focuses on the two states among the lowest on this measure (Wisconsin and Texas) and the two states among the highest (Illinois and New Jersey), and discusses the system features that may be contributing to these states’ results based on findings from WCRI’s CompScope™ Benchmarks studies.

There are also other contributing factors to the variation in attorney involvement. For example, according to the WCRI study, 40% of California’s claims involve worker attorneys. Contributing to this high percentage of attorney involvement is the state’s low standard in proving cumulative trauma (CT) claims (injuries that happen gradually at work, over a period of time, or during a course of repetitive work-related activities), which requires only a 1% percent causation threshold and uses a simple “preponderance of evidence of proof.” In addition, because there isn’t a specific event reporting date for a CT claim in California, it’s difficult for an employer to prove that the injury wasn’t caused by the employee’s work. You can have a CT claim going back a year ago, or even 15 years. This often results in litigation and increased attorney involvement. Arkansas, on the other hand, limits CT claims to repetitive motion injuries for back/neck or hearing loss, and Louisiana will only accept CT claims related to occupational diseases.

“This study helps inform policymakers and stakeholders about whether worker attorney involvement in their state is lower, near the middle, or higher relative to other states,” said John Ruser, WCRI’s president and CEO. “It also helps facilitate discussions about why workers’ compensation systems vary in attorney involvement.”

The analysis in this report uses data from 24 data sources, including national and regional insurers, claims administration organizations, state funds, and self-insured employers. The data are collected in the WCRI Detailed Benchmark/Evaluation (DBE) database, which includes about 7.5 million claims that are reasonably representative of the entire system in each of the 18 states, including all market segments: self-insurance, residual market, voluntary insurance, and state funds.

Caitlin Morgan provides a selection of Workers’ Compensation solutions for a wide range of businesses and can assist you in placing coverage. For more information about our comp solutions, contact us at 877.226.1027.