January 21, 2025 | Sacrament, CA — MedLegalNews.com — Public self-insured claims in California have declined, according to a recent report by the Office of Self-Insurance Plans (OSIP). The report highlights a notable reduction in California public self-insured workers’ compensation claims for the fiscal year (FY) 2022/23, primarily driven by a sharp drop in indemnity claims, signaling an important shift in the workers’ compensation landscape.
Key Findings
- Public self-insured claim volume decreased by 16.8% compared to the previous year.
- Total paid losses reduced for the first time since the 2012 workers’ compensation reforms.
- Total incurred losses also saw a decline, continuing a trend observed since the pandemic began.
Report Details
The report focuses on the experiences of public entities, such as cities and counties, that self-insure their workers’ compensation. The number of claims filed in FY 2022/23 was 120,328, significantly lower than the record high of 144,676 in FY 2021/22. This reduction likely stems from fewer COVID-19 claims among public sector employees.
The decline in claims also reflects ongoing efforts by public employers to implement stronger workplace safety programs and injury prevention initiatives. Additionally, changes in reporting practices and the continued impact of remote work policies for certain public sector employees may have contributed to fewer incidents requiring workers’ compensation claims. Analysts note that these trends could influence budgeting and reserve planning for public self-insured entities in the coming years, as they adapt to both evolving workforce dynamics and post-pandemic recovery strategies.
Changes in Benefit Payments
Despite the overall decline in claims, the average benefit payment per claim rose by 4.9%, reaching $4,241. This increase resulted from a slight decrease in average paid medical costs, which dropped to $1,605, while average indemnity payments remained stable at $2,636. Experts suggest that the rise in average benefit payments may reflect a shift toward higher-severity claims or more complex injuries among the remaining filings. Additionally, evolving medical treatment protocols and cost adjustments for inflation could have contributed to the higher per-claim payout. Public self-insured entities may need to monitor these trends closely to ensure their reserves and budgeting strategies remain sufficient for future claims.
Incurred Losses Trend
Incurred losses, which include paid amounts and reserves for future payments, presented a mixed pattern. While the total incurred loss decreased by 8.3%, the average incurred loss per claim increased by 10.0%. Both average incurred indemnity and medical costs per claim saw an upward trend.
Additional Information
OSIP also collects data on private self-insured claims, reported on a calendar year basis, which lags behind the public self-insured data. The next report on private self-insured experience is anticipated next summer.
For a detailed analysis and comparisons over the past decade, refer to the CWCI Bulletin and OSIP’s annual summaries.
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FAQ: California Public Self-Insured Claims
What caused the decline in public self-insured claims in 2022/23?
The decline in California public self-insured claims is mainly due to fewer indemnity and COVID-19-related claims among public sector employees.
How much did the average benefit per claim increase for public self-insured claims?
The average benefit per claim rose by 4.9%, reaching $4,241, reflecting changes in medical and indemnity payments.
Are incurred losses trending up or down in public self-insured claims?
Total incurred losses decreased by 8.3%, but the average incurred loss per claim increased by 10% in California public self-insured claims.
Where can I find detailed reports on public self-insured claims?
Detailed reports and decade-long trends for California public self-insured claims are available in the CWCI Bulletin and OSIP annual summaries.