The effectiveness of insurer‐supported safety and health engineering controls in reducing workers' compensation claims and costs

Abstract

Background This study evaluated the effectiveness of a program in which a workers’ compensation (WC) insurer provided matching funds to insured employers to implement safety/health engineering controls. Methods Pre- and post-intervention WC metrics were compiled for the employees designated as affected by the interventions within 468 employers for interventions occurring from 2003 to 2009. Poisson, two-part, and linear regression models with repeated measures were used to evaluate differences in pre- and post-data, controlling for time trends independent of the interventions. Results For affected employees, total WC claim frequency rates (both medical-only and lost-time claims) decreased 66%, lost-time WC claim frequency rates decreased 78%, WC paid cost per employee decreased 81%, and WC geometric mean paid claim cost decreased 30% post-intervention. Reductions varied by employer size, specific industry, and intervention type. Conclusions The insurer-supported safety/health engineering control program was effective in reducing WC claims and costs for affected employees.

Understanding the Economic Benefit Associated with Research and Services at the National Institute for Occupational Safety and Health: An Approach and Three Case Studies

“…This case study focuses on a NIOSH research study, published in 2014, that evaluated the effectiveness of BWC's Safety Intervention Grant Program (Wurzelbacher, Bertke, et al, 2014). NIOSH's evaluation found that the program significantly reduced workers' compensation claims and costs.…”

“…According to an interview with a BWC staff member, the collaboration with NIOSH allowed BWC to obtain, for the first time, credible estimates of workers' compensation claim rates per employee hours worked, the size and industry of employers that the safety intervention grants affected, and other information required to rigorously estimate the effectiveness of the grant program. The report on the study evaluating the Ohio grant program was published in 2014 (Wurzelbacher, Bertke, et al, 2014) and relied on data that BWC collected from 2001 to 2009. In 2013, after seeing the preliminary results of the NIOSH work, BWC quadrupled its annual funding for safety intervention grants to substantially increase the total number of grants available per year (Buehrer, 2013).…”

“…For each insurance claim, insurers are liable for both medical costs and a portion of lost wages. Wurzelbacher, Bertke, et al, 2014, estimates that BWC's Safety Intervention Grant Program decreased the number of claims per affected employee by 66 percent 61 Data for the total number of employees covered by any form of workers' compensation insurance in each state come from 2016 and 2017 reports by the National Academy of Social Insurance (NASI) (Baldwin and McLaren, 2016;McLaren and Baldwin, 2017). BWC, MEM, and Texas Mutual provided data on the number of grants issued in each year and the average number of affected employees per grant.…”

“…From this study, we infer that the mean cost per employee declined by 76.2 percent. 62 It is important to note that Wurzelbacher, Bertke, et al, 2014, is based on paid 30-month costs. 63 We assumed that costs incurred more than 30 months after the date of the claim are also reduced by 76.2 percent, on average.…”

“…Firms might have been spurred to apply following an atypically costly series of workplace injuries, with losses naturally returning to mean levels the following years regardless of the grant. Wurzelbacher, Bertke, et al, 2014, tests for such regression to mean, and indeed the authors found that higher preintervention claims are associated with greater postintervention declines in cost, although they point out that factors other than regression to mean could also cause that pattern. Additionally, the type of firm that applies for grants might also be pursuing workplace safety in other ways.…”