Does Texas Require Workers Compensation Insurance – However, as an insurance professional, you know that workers’ compensation claims in Texas are more complicated than that simple explanation. As always, the workers’ compensation statistics tell a more dramatic story.
Industry experts and legislators receive Texas compensation statistics every two years in an annual report from the Division of Workers’ Compensation (DWC).
Does Texas Require Workers Compensation Insurance
Here’s what you need to know from the latest 2018 report so you can prepare your business and your customers for what’s to come in 2020.
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Fatal work injuries are far less common now than they were decades ago, but one fatality on the job is one too many. Where are we today?
The most recent national data available from the Bureau of Labor Statistics and OSHA goes back to 2018-2019 data that is likely to be available in late 2020. The same is true of Texas Department of Insurance reports that report workplace injury data in Texas.
Texas saw a total of 488 fatal work-related injuries in 2018. Nationwide, a total of 5,250 American workers died from fatal work-related injuries in 2018. This means that Texas has 9.29% of the total deaths.
Unfortunately, this is not a new problem in Texas. In 2016 and 2017, one Texas worker died on the job every 16 hours.
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What are the tragedies behind these tragedies? Incidents or discoveries behind fatal injuries in Texas in 2018 include:
Among workers, most injuries occurred among wage and salary workers (402). Only 86 deaths occurred among independent workers.
In addition, there was a relatively even distribution between the ages of 25 and 64. Deaths by age group in 2018 were as follows:
As insurance professionals, we think in terms of risk. In many cases, workers’ compensation risk depends on the perceived risk of a particular industry.
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Some industries, such as construction, are much more risky than others, such as finance and real estate. It shows: construction comes with more injuries and deaths than many other industries.
Of the 488 total occupational deaths in Texas in 2018, 454 deaths occurred in private businesses, and 34 occurred in government.
At the local government level, there were 8 violent deaths, 7 transportation incidents, and 3 slips, trips and falls.
Like most of the United States, Texas has seen a 20-year decline in non-occupational injury and illness rates, but the numbers have stabilized in recent years.
Guide To Texas Workers Compensation Stats
In 2018, 2.8 million non-communicable workplace injuries and illnesses were recorded across the United States. The Survey of Occupational Injuries and Illnesses (SOII) estimated that 177,977 non-fatal cases were recorded in Texas in 2018.
The question is: What industries and workplaces are most affected? The answer is surprising. It was Texas
The data shows that agriculture, forestry, fishing and hunting have the highest incidence of 5.7. In addition, art, entertainment and recreation comes in a very close second with leisure (4.8).
Getting workers back to work more quickly reduces the cost of workers’ compensation claims and ultimately contributes to lower premiums. Injured workers who return to work within six months have fewer days off work.
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While employers cannot prevent all injuries, illnesses and claims, they can create programs that ensure workers receive the care and support they need to recover.
In 2007, 78 percent of injured workers returned to work within six months. By 2017, the number had increased five points to 83 percent returning to work within the first six months after injury.
Those who return to work within six months return to pre-recession wage levels approximately two years after their return.
In addition, nine out of ten workers are back to work in some capacity within a year. And 95% will return after three years.
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Injured older workers have more days off work: Workers aged 60+ have ten more days off work than injured workers aged 16-29.
Which businesses have the most days off? Workers in mining, resources, construction and agriculture have the highest average and median number of holidays.
Texas is the only state in the United States that allows private business employers to opt out of workers’ compensation. Those who leave are subscribers.
Measuring the level of subscribers and non-subscribers gives us a lot of insight into the workers compensation landscape. Unlike other states, it creates two completely legal collections of employer data to work with. Researchers at DWC use it to determine appropriate policy to shape workers’ compensation and liability law. They also use information to provide maintenance systems, as you can see below.
On The Job Injury In Texas Is It Worker’s Comp Or A Personal Injury Case?
So, who has workers’ compensation coverage in Texas? This is more than the state often gets credit for.
In 2018, 82 percent of private sector workers (1.8 million) worked for 72 percent of employers (267,000) with workers’ compensation.
Only 28 percent of private sector workers do not have an employer company, and they employ only 18 percent of private industry workers.
In other words, small employers are more likely to have subscribers, but they are not as responsible as employers. And it is the coverage that counts rather than the number of subscribers.
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Between 2004-2016, the percentage of unregistered people decreased from 38% to 22%. During this period, premium rates also fell by 20 percent, making labor cheaper and thus forcing more employers to sign up.
The number of workers lost to working for non-members has not changed much. It reached a peak of 25 percent in 2008, and a low of 16 percent in 2001.
A common misconception suggests that nonmembers do not provide useful data for understanding workers’ compensation insurance status.
But it is not possible for non-subscribers. Non-subscribers must submit an annual notification that they do not have employer coverage (Form DWC-005). Employers with five or more employees must also submit Form DWC 007 for all occupational illnesses and injuries involving more than one day of lost time. Failure to report will result in penalties.
Do I Need Workers’ Comp Insurance If I Have No Employees?
Currently, the problem is that DWC relies on community reporting to generate data. And not so many community reports. An internal investigation only goes so far.
In a 2018 report to the Texas Legislature, the DWC cited internal investigative efforts for the majority of the 2,853 complaints reported since 2009.
Only 19 percent of non-registrants did not register in 2018, but 35 percent did so in 2016. In 2014, 12 percent complied. As a result, it is difficult to obtain meaningful injury data outside of OSHA recorded and reported injuries and data generated by the BLS.
Additionally, non-members only report injuries for which they are responsible. The DWC suggests that this may explain why injury reports from non-subscribers are lower than those reported by subscribers.
Workers Compensation Insurance
After looking at Texas injuries, let’s see how Texas workplace safety claims and costs compare.
Data from the NASI show that cash benefits paid to workers in Texas were as follows (in thousands):
NCCI data found that the average for each worker’s compensation claim nationwide in 2016-2017 was $40,051. Reasons for the most expensive claims include:
In 2001, Texas was among the most expensive states in terms of cost per claim. Texas’ Medicare cost per claim is 21 percent lower than the average cost of 18 states, including Florida, Illinois, Louisiana and Pennsylvania. However, Texas claims are still more valuable than California, Michigan, and Massachusetts.
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From 2013 to 2017, Medicare payments fell 17 percent. Pharmacy payments decreased by 39%. Why did this happen?
In 2005, changes were made to Texas legislation to address poor injury outcomes and high costs. They adopted evidence-based treatment guidelines, certified workers’ compensation health care networks, and created a closed formulary pharmacy.
As of 2018, there were 29 certified health networks covering 254 districts. Claims handled in the network increased from 20% in 2010 to 50% in 2018. Initially, the prices in the network were high, but in 2014 the prices in the network started to decrease.
Texas has also seen a net increase in the number of physicians treating injured workers since 2005. There were 17,656 doctors in 2005, 18,419 in 2017.
Workers’ Compensation Insurance
With a stable pool of doctors, lower claims see lower caseloads per doctor, which benefits everyone. In 2005, a doctor filed a caseload of 19 claims. As of 2017, fewer than 15 claims were made per physician in 2017. This represents a 24% decrease.
As we mentioned in our National Statistics post, workers’ compensation disputes are bad for everyone involved. Disputed claims that are transferred from rejected lots to accepted lots are worth much more than claims that are accepted immediately.
A study by Lockton found that 67 percent of denied claims are paid within a year. Once accepted as payment, their value is 55% higher than the original amount.
In the past, there were a lot of conflicts in Texas. In 2005 there were 13,000 medical disputes before the legislation changed rehabilitative care. By 2017, the number had dropped to 5,000, a 63 percent decrease.
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In addition, it also takes very little time to resolve disputes that occur. Between 2005 and 2017, the schedule decreased by 70-84%. Disagreement is due to disagreement
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