Do Not Ignore These Cost-Driving Developmental Claim Factors
Developmental claims involve fairly routine injuries that can evolve into excessively-high settlement demands. But how do these claims pivot so quickly? Look for these contributing factors when reviewing claim costs.
October 11, 2021
Unlike rare catastrophic claims, developmental claims typically do not start as severe, life-threatening injuries. In fact, two-thirds of developmental claims start as routine back, shoulder and knee injuries, but due to complications, such as failed surgeries or opioid involvement, the claims escalate in costs over a million dollars. While not all of the contributing factors are preventable, early intervention can reduce the overall effects.
These claims can be extreme losses, sometimes in excess of $5 million, and are host to a multitude of contributing factors,” said Tim Stanger, Vice President – Partner Relations at Safety National. “There are even less commonly discussed factors, like lower interest rates, that impact the present value used in settlements. Discounts that were once 8%, are now in the 5% range, ultimately increasing the amount paid.”
Here are contributing factors in the evolution of developmental claims that should be on your radar.
1. Aging Workforce, Comorbidities and Psychosocial
Since 2000, the number of employees age 55 and older has doubled. Older workers are more likely to be sedentary and susceptible to injuries, and to have more comorbidities and an increased likelihood of not returning to work. Additionally, comorbidities and psychosocial factors can both play a significant role in contributing to the complexity and duration of medical treatment. Comorbidities, like diabetes, high blood pressure and previous drug or opioid addiction can cause serious complications when treating other injuries and can prolong treatment. Psychiatric history, family history, living conditions and social dynamics can also influence an injured worker’s recovery. These factors can also influence their motivation to recover or return to work.
2. Types of Injuries
Certain injuries have a significantly higher associated claims cost. Motor vehicle accidents (MVAs) are on the rise, costing twice as much as the average injury, which means they have the potential to quickly transform into a developmental claim. Traumatic brain injuries (TBIs) are also typically higher risk, especially with associated comorbidities, and involve a longer recovery and rehabilitation time.
3. Medical Triage and Emergency Care
Onsite medical triage advances, faster hospital transportation and significant technological advances in emergency medical care and treatment saves lives. Prolonged life expectancy and increased functionality means hospital charges can quickly add up. A severe burn patient, for example, can incur over $10 million in the first year of treatment. Newer, high-tech prosthetics that need replacing every 2-3 years are also more expensive than their older models.
Incredible advances in medical care, like infection controls and synthetic skin, have led to a dramatic increase in injury survivability. Workers with catastrophic injuries are living longer, making survivability the biggest contributing factor in developmental claims. Not long ago, a quadriplegic would have lived no more than 10 years, but can now live a near-normal life expectancy.
5. Avoidable Injuries
Sadly, many developmental claims involve injuries that are wholly preventable. For example, many MVAs are directly attributed to police officers not wearing seat belts and driving at high speeds in adverse weather. Additionally, weapon handling, poor training and failure to wear appropriate equipment have also contributed to officer injuries. Stress and suicide also heavily impact officers, with the Bureau of Labor Statistics (BLS), citing 78% experiencing critical stress and 15% struggling with suicidal thoughts.
6. Workplace Violence
According to the latest workplace violence statistics released by the National Safety Council, physical assaults in the workplace resulted in 20,870 injuries and 454 fatalities in 2019, with most occurring in education, healthcare or social assistance services. Per 100,000 full-time workers, police officers have a fatal work injury rate of 13.7, where all other occupations have a rate of 3.5.
7. Presumption Claims
Rising COVID-19 claims in occupations outside of frontline workers has led to states introducing a slew of new presumption laws. What once was reserved for heart and lung diseases for police officers and firefighters, can also cover certain cancers and post-traumatic stress disorder (PTSD) in first responders.