Workers compensation costs being covered by other sources

SACRAMENTO, Calif.—Researchers at the University of California Davis say nearly 80% of direct and indirect costs that could be covered by workers compensation insurance are being paid by private health plans, government insurance programs or from workers' own pockets.

The study's lead author says underreported workers comp claims have resulted in discounted insurance premiums and decreased incentives for employers to improve their safety records.

However, workers comp experts are skeptical of the study, saying that workplaces have become safer over time, and that workers comp often covers costs for treatment unrelated to work injuries.

Harry Shuford, chief economist at Boca Raton, Fla.-based NCCI Holdings Inc., said the study shows the need for greater understanding between workers comp experts and the public health community, including researchers.

“At the base, our concerns and interests are the same,” Mr. Shuford said. “We want a safer workplace. We don't want employees getting hurt, much less being killed, on the job, and I think both groups have lots of value to contribute if we can just get past this hurdle.”

The report, Workers' Compensation Benefits and Shifting Costs for Occupational Injury and Illness, was published in the April edition of the Journal of Occupational and Environmental Medicine. It found that there were $249.6 billion in medical and indirect costs related to workplace injuries and illnesses in 2007.