Q2 – 2025 – July 14, 2025
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Research IMR Update Through Q1 2025. A series of 10 exhibits detailing CWCI’s latest update on the dispute resolution process in California workers’ compensation and IMR activity and outcomes from 2015 through the first quarter of 2025.The results show IMR determination letter volume was up 13% in the first quarter of 2025 compared to the total from the first quarter of 2024, the median time from the application date to the determination letter date held steady at 32 days, after dipping to an 11-year low 88.0% in 2024, the IMR uphold rate rose to 89.1% in Q1 2025, and prescription drugs continued to account for more IMR disputes than any other type of medical service, but prescription drug requests declined share of the IMR decisions declined to 30.6% in the first quarter of 2025, compared to half of the decisions a decade earlier. Executive Briefing (6/30/25) (members only) Bulletin (6/26/25) (members only) News Release (6/25/25) (public) Detailed Statistics (05/21/25) (members only) Insurer Profitability Data. The Nat’l Assn of Ins Commissioners (NAIC) annual report on Profitability by Line/by State notes insurers’ return on net worth for each of the past 10 years, documenting solid returns for Calif WC insurers following implementation of the 2012 reforms. The latest NAIC data show that from 2014 through 2023, Calif WC insurers’ annual returns ranged from 5.8% in 2014 to 14.5% in 2023, while the net return for the decade fell right in the middle of that range: 10.6%. That was nearly identical to the 10-year avg return of 10.5% for WC insurers nationwide; and compared favorably to the 6.0% return for P&C insurers nationwide; the 5.8% return for all lines of insurance in Calif; and the 7.9% return for all lines nationwide. It did, however, lag the avg 14.9% return for Fortune’s Industrial/Service Sector over the same 10-year span. CWCI Bulletin 25-06 has more details. Executive Briefing (6/30/25) (members only) Bulletin (4/28/25) (members only) Long COVID-19 Claim Characteristics and Treatment in Calif Workers’ Comp. CWCI research examining the various characteristics of Long COVID claims in California workers’ compensation, including the distribution of claims by diagnostic category and affected body part, the mix of treatment payments among medical service categories at different points of development, and demographic differences between Long COVID and shorter duration COVID claims. Research Report (6/3/25) (members only) Bulletin (6/3/25) (members only) News Release (6/3/25) (public) Changes in the Regional Mix of Claims. A CWCI analysis of Claim Characteristics & Trends Data App data compared regional claim distributions for all Calif WC claims, COVID claims, and non-COVID claims from 2018 through Feb. 2025 to determine how the regional mix of claims in the state changed from the pre-pandemic era to the post-pandemic era. The app was used to determine the overall claim distribution and the COVID and non-COVID claim distributions for 3 distinct periods: pre-pandemic (March 2018-Feb 2020); pandemic (March 2020-Feb 2023); and post-pandemic (March 2023-Feb. 2025). Calif went from no COVID claims before the pandemic to 319,174 COVID claims during the pandemic, and the COVID claim distribution by region differed from that of non-COVID claims, which led to a shift in the regional distribution of all WC claims. L.A., which has a quarter of the state’s jobs, saw its share of all claims fall from 26.0% to 24.8% as many employees began working remotely, lost their jobs, or left the area, while the Inl Empire/Orange Co. accounted for nearly 25% of all COVID claims during the pandemic. the most of any region, and its share of non-COVID claims also edged up, so it went from 20.7% to 22.3% of all claims. After the pandemic, L.A.’s share of COVID claims fell from 23.3% to 19.2%, but there were only 28,166 COVID claims statewide over the 2-year span (< 2% of the statewide total) so the decline had little impact and L.A. once again surpassed the Inl Empire/O.C. in total claim volume. The Inl Empire/O.C., which was hard hit by COVID claims, also saw its share of COVID claims drop after the pandemic (from 24.9% to 19.1%) but its 22.0% share of all claims was still 1.3 points higher than it had been prior to the pandemic. The Central Valley had similar experience, as it accounted for 22.0% of all COVID claims during the pandemic, which pushed its share of all WC claims up from 19.3% to 20.7%. In the past two years, the Central Valley’s share of all claims has remained above the pre-pandemic level and it has accounted for nearly a quarter of the state’s COVID claims. Like L.A., the Bay Area, and S. Diego, the Central Coast’s share of COVID claims was lower than its share of non-COVID claims during the pandemic, which pushed their share of all claims down, but w/COVID claim volume now a fraction of what it was in the pandemic, the impact of COVID claims in these regions has been negligible since 2023. For more details on COVID and Non-COVID claims experience, including distributions by industry, visit the Claim Characteristics & Trends App at www.cwci.org. Executive Briefing (5/29/25) (members only) Q4 2024 Insured Experience. WCIRB issued its report on Calif WC insurer loss and premium experience for Q4 2024. Highlights include:
Executive Briefing (5/29/25) (members only) CWCI’s Claim Characteristics and Trends Interactive App. CWCI’s systemwide app with data on all insured and self-insured workers’ compensation claims reported to the DWC’s Workers’ Compensation Information System (WCIS) as of 4/18/25. Featuring data from AY 2018 forward, the app shows overall trends and claim distributions by region, industry, and injury characteristics and allows users to track the number of reported and projected claims by year, by quarter and year, or by month and year. Filters can be used to view results for combinations of insured and self-insured claims, by claim type, industry, region, injury description, reporting timeliness, and COVID-19 status. Interactive Data Application (4/29/25) (public) Long COVID Claims. After Gov. Newsom declared the COVID-19 pandemic 5 years ago, a flood of COVID WC claims hit the state, with nearly 350K COVID claims between 2020 and the end of 2024. COVID claims are still being filed, but more than 90% of all COVID claims that have been filed were from AY 2020-22. Most resolved in less than 90 days and were relatively inexpensive, but some have resulted in long-term medical conditions that impede or prevent workers from returning to their jobs and result in significant cost. A CWCI study set for release in May examines these “long COVID claims” and compares the medical care, claim and payment duration, and claimant characteristics associated w/long-COVID claims to those associated w/COVID claims w/less than 90 days of treatment. Among the findings:
Executive Briefing (4/23/25) (members only) Shifts in Regional Rankings of Avg TD Days Before, During and After the Pandemic. CWCI’s Regional Scorecard App shows that pre-pandemic (AY 2017-2019) Calif WC claims w/TD payments averaged 163 paid TD days, but results ranged from 148 days in San Diego to 176 days in the Inland Empire/Orange. The avg number of paid TD days in L.A. was 175, but in the Bay Area the avg was 158 days prior to the pandemic, 5 days below the statewide average. San Diego continued to have the fewest paid TD days in the pandemic and post-pandemic period (2023-March 2024), but during the pandemic (2020-22), the Bay Area ranked first in terms of avg TD days, (163), which was 8 days above the statewide avg. L.A. and the N. Counties/Sierra had the 2nd highest number of TD days during the pandemic (160 days), just ahead of the Inland Empire/Orange, while the Central Coast (154 days) and Central Valley (146 days) were below the statewide avg during the pandemic. During the post pandemic era, the N. Counties/Sierra (91 days) and L.A. (90 days) ranked 1st and 2nd in avg number of TD days, closely followed by the Bay Area and the Inland Empire/Orange, which averaged 89 days, while the Central Coast, (84 days), Central Valley (80 days), and San Diego (76 days) all averaged below the statewide figure. The avg TD days on younger claims will increase as they develop so in June CWCI will update our Regional Scorecard and our other apps w/data through December 2024. Executive Briefing (4/23/25) (members only) Changes in the Number and Availability of QMEs in Calif WC. A CWCI analysis of the availability of QMEs shows that the number of QMEs certified by the state jumped 16% between 2019 and 2024, with most of that growth occurring after a new medical-legal fee schedule (MLFS) took effect in 2021, but that increase was offset by a 17% increase in the number of requests for QME panels over the same period. The ratio of panels to QMEs showed only a marginal increase in the number of panel assignments to registered QMEs between 2019 and 2024, though with the increase in QMEs and the decrease in the number of panel assignments in 2021the ratio dipped as low as 52.85 panel assignments per registered QME in 2021 before it began to rebound as the growth in the panel requests outpaced the growth in the number of QMEs in 2022, 2023, and 2024. The analysis also measured the availability of QMEs by medical specialty and within specific geographic regions of the state. Bulletin (4/15/25) (members only)
Statutory/Regulatory ML Template Bill. In late June the Senate Comtee on Labor, Public Employment & Retirement passed AB 1293, which would require the DWC to create a medical evaluation request form to be used by all parties for communicating with a panel QME, and a template for QMEs to write ML reports that “shall include all necessary statutory and regulatory requirements for a complete report that constitutes substantial evidence.” Though use of a template QME report would not, in and of itself, constitute prima facie evidence that the report is complete, accurate, or meets statutory or regulatory requirements, one goal is to reduce the need for supplemental ML reports. AB 1293 would also require DWC to create a process for submitting allegedly inaccurate or incomplete reports; conduct an annual evaluation of ML reports; and publish a report on the findings. The bill calls for DWC to adopt regs to implement its provisions by 1/1/27. AB 1293 was sent to the Senate Appropriations Comtee. Executive Briefing (6/30/25) (members only) 2025 WCAC Deadlines. In late May the Dept. of Ins. sent Calif WC insurers a reminder of this year’s deadlines for the WC adjuster certification & medical bill review (WCAC-2025) data reporting obligations. Insurers must email their WCAC-2025 Acknowledgement of Receipt Form back to the CDI by next Friday (6/6/25); while the WCAC-2024 Data Workbook is due by Monday, 7/7/25. CWCI issued an Exec Memo to remind our member insurers to alert those responsible for their company’s reporting that the 7/7/24 deadline for submitting the Data Workbook is the Monday following the 4th of July week when many employees may be off. The 6/6/25 deadline to submit the Acknowledgment of Receipt Form was just over a week away, but the Institute advised that CDI will allow companies a brief extension for submitting the data workbook if the requests were emailed to the program manager by June 20. A link to the circular attached to the notice was provided, as was the program manager’s email. Executive Briefing (5/29/25) (members only) Executive Memo (5/22/25) (members only) Loss Control Alert: Fed OSHA Updates Inspection Program. In May Fed OSHA updated its inspection program for non-construction establishments w/20 or more employees. It will now direct its enforcement resources to worksites w/the highest rates of injuries and illnesses based on OSHA Form 300A data sent in response to recordkeeping requirements. The Site-Specific Targeting program uses submitted data from CY 2021-2023 to target employers that: 1) had the highest injury and illness rates in CY 2023; 2) had upwardly trending injury and illness rates based on 2021-2023 data (or that had rates that were more than twice the 2022 private sector average); 3) had injury and illness rates that were well below industry averages; or 4) failed to submit an OSHA Form 300A in 2023. This program replaces a Biden Administration program initiated in Feb 2023. OSHA also uses national and local emphasis programs to target high-risk industries and hazards, and its On-Site Consultation Program will continue to provide free job safety and health services to help small- and mid-sized businesses identify workplace hazards, comply w/ OSHA standards, and establish and improve safety and health programs. The on-site consultation services are separate from enforcement and do not result in penalties or citations. Executive Briefing (5/29/25) (members only) CWCI Comments on Proposed Modifications to the UR and IMR Regulations. CWCI’s 2nd 15-day public comments on the DWC’s proposed changes to the text of rules related to the regulations governing utilization review and independent medical review. 15-Day Public Comments (5/3/25) (members only) Deadline for Testing DWC’s Pharmacy Fee Calculator and Providing Feedback. The DWC announced that it created a website so the public can test the new Pharmacy Fee Calculator that the Division has developed for the new Pharmacy Fee Schedule that will take effect for dates of service on or after 7/1/25. Pilot testing began on April 24 but was only scheduled to run for 2 weeks so the Institute issued a reminder to members that wanted to try out the calculator in advance and provide feedback to the Division that only one week remained to do so. The pilot test was posted on the DWC website so the Institute provided the link and the email address for providing feedback. Executive Memo (4/30/25) (members only) WCIRB to Request an 11.2% Rate Increase. Prompted by increases in medical loss development, a 12% increase in medical severity in 2024 (including a 14% increase in avg payments for inpatient services), and a jump in claim frequency – driven in part by the emergence of CT claims in N. Calif and the resulting growth in allocated loss adjustment expenses, in April WCIRB’s Governing Comtee voted to request an 11.2% overall rate increase for WC policies incepting o/a 9/1/25. If approved, the rate hike would be the 1st in a decade, bringing the advisory premium rates nearly back to their pre-pandemic levels, which is about half of the pre-SB 863 level. The increase in CT claims throughout Calif is notable and coincided w/the recent shift to virtual WCAB hearings, which the WCIRB said was followed by a 21% increase in the use of L.A. applicants’ attorneys in Bay Area hearings and a 12% increase in the use of L.A. applicants’ attorneys in San Diego hearings. In addition, applicants’ attorneys have reportedly increased the number of out-of-area claims filed at the L.A. and Van Nuys WCABs. At its meeting earlier in early April, all insurer members of the Governing Comtee rejected the 8% increase recommended by the actuary representing public members and labor representatives and instead approved the higher request based on WCIRB’s recommended methodologies, which public members opposed. The filing will go to Commissioner Lara, who has rejected the 5 previous requests for rate increases presented to him. CDI will schedule a hearing to consider the filing and once it issues a Notice of Proposed Action and Notice of Public Hearing. If approved, the rate hike would be the 1st increase in a decade and would boost the average advisory pure premium rate to 52 cents per $100 of covered payroll, up from last year’s approved rate of 46 cents per $100 of payroll. Executive Briefing (4/23/25) (members only) UR Reg Update. DWC opened a 2nd 15-day comment period on proposed changes to UR regs after eliminating proposals to: 1) combine the PR-2 physician progress report and the treatment authorization request form into a single form; and 2) penalize claims administrators if they don’t meet the 5-day deadline for responding to a treatment request even if the request was submitted to a non-designated address, email address or fax #. The revised draft of the regs proposes allowing physicians to submit treatment requests using electronic data interchange (EDI) if the EDI option is made available by the claims administrator. Public comments on the proposal can be emailed to dwcrules@dir.ca.gov through May 2. A DWC Newsline w/a link to the latest draft of the regs, is here. Executive Briefing (4/23/25) (members only) DWC Reminder for RTWSP Applicants. In early April the DWC issued a Newsline to alert the WC community that it will deny injured worker applications for benefits under the Return-to-Work Supplement Program (RTWSP) if the applications don’t meet specific requirements. State lawmakers created the $120 million/year RTWSP, which is administered by DIR, as part of SB 863. The program provides injured workers who receive a Supplemental Job Displacement Benefit (SJDB) voucher a 1-time payment of $5,000, but the benefit will be denied if the applicant fails to:
DWC suggests that applicants triple-check all info before they submit it and advise that only one application per claim should be submitted. Executive Briefing (4/23/25) (members only)
Legal Court Ruling in Going & Coming Rule Case Law. In December 2024, CWCI filed an amicus brief in Zenith Insurance Co. v WCAB (Hernandez), a case that centered on the special risk exception to the “going and coming rule.” In the case, the applicant claimed a job injury when the carpool van in which he was riding home from work was in an accident. The applicant worked as a laborer 60 miles from his home but did not have a driver’s license or car and did not know how to drive, so he joined a vanpool arranged by a fellow employee, though the employer made it clear at the time of hire that it did not provide or arrange transportation for employees. The claims administrator denied the claim based on the going and coming rule, but the WCJ found the special risk exception to the going and coming rule applied, noting that due to the distance to the work site, the commute was not “local” as contemplated in prior case law (Hinojosa) so the applicant had to take extraordinary action by participating in the vanpool to ensure he could make it to work on time, every day, and get home afterwards. The judge found that this employment-related condition created a special risk, noting the applicant would never have been in a van coming home from work, at the location where the accident took place, but for this special condition of employment. The judge also found that the case fell within the “dual purpose” exception to the going and coming rule, concluding that this exception applies because the applicant’s employer obtained a benefit from the vanpool which permitted the applicant to arrive “at work and on time every day.” After the WCAB denied reconsideration, the defendant appealed. On 12/18/24, CWCI filed an amicus brief in support of the defendant, and last month the DCA annulled the ruling and remanded, holding that: 1) the special risk exception only applies to situations just outside the employment premises – and this case did not meet that requirement; and 2) the facts were not sufficient to apply the dual-purpose exception, as they did not go beyond the normal need of the presence of the person for the performance of the work. The ruling has been published, so it is considered binding precedent and may be cited in future cases. CWCI members can access more information on the Hernandez case and other Calif WC cases, including all related case documents, by logging on to www.cwci.org and visiting the Legal Brief Bank under the Legal tab on our home page. Executive Briefing (6/30/25) (members only) Other Case Law Update. In late May registration opened for CWCI’s 27th annual Calif WC Case Law Update, a live, online broadcast that will be presented on Sept 9 from 9 a.m.-3:30 p.m. (Pacific). The program, moderated by CWCI Sr. VP of Claims and General Counsel Sara Widener-Brightwell, features a panel of legal experts who will provide practical insight from both sides of the courtroom, allowing attendees to gain a better understanding of how to use case law to effectively manage, negotiate, and defend claims, and what to expect from opposing counsel. In addition to providing updates on recent decisions, the panel will identify issues related to recent statutory and regulatory changes, examine old case law to see what still applies, and offer claims and legal professionals a fresh look at the impact of case law. The program will utilize an A-V presentation to provide case details, factual backgrounds, and other highlights for every case on the agenda and registrants will receive a complete electronic version of the course materials w/hyperlinks to the decisions. Information on how to register online or to download the seminar flyer was provided. Executive Briefing (6/30/25) (members only) Executive Memo (6/5/25) (members only) News Release (6/4/25) (public) WCIRB Moves to San Francisco. WCIRB relocated from Oakland to San Francisco on Friday, May 30. Its new mailing address is One Montgomery Street, 4th Floor, San Francisco, CA 94104, but its phone numbers did not change. Direct dial numbers beginning with area code 415 continue to operate and the Rating Bureau’s Contact Center number remains 888-229-2472. Online services such as www.wcirb.com, WCIRB Connect®, the WCIRB AnalyticsPortal and eSCAD® remain operational. Executive Briefing (5/29/25) (members only) Save the Date: CWCI’s 27th Annual Case Law Seminar. The Institute will hold its 2025 Case Law Update Seminar as both a live program at the OCC Conference Center in Oakland, and as an online video broadcast on Tues., Sept. 9. Registration details are forthcoming. In the meantime, save the date. Executive Briefing (4/23/25) (members only) CWCI Elects Board of Directors For 2025. Eric Hansen, SVP – Underwriting at Preferred Employers, was re-elected as Chair of the CWCI Board of Directors for 2025. Mr. Hansen was first elected to the Board in 2014, has been a member of the Executive Committee since 2021, and was first elected to chair the Board in March 2024. Joining Mr. Hansen on the 2025 Executive Committee will be Kris Mathis, CopperPoint Insurance Companies, who will serve as Vice Chair; Michael Cunningham, Zenith Insurance Company; Amanda Granger, ICW Group Insurance Companies; Carmen Sharp, The Hanover Insurance Group; Vernon Steiner, State Compensation Insurance Fund; and Matthew Zender, AmTrust North America. Also elected to serve on CWCI’s 2025 Board of Directors were David McGowan, AF Group/CompWest; Ricardo Nan, AIG; Andrew Linkhart, Berkshire Hathaway Homestate Companies; Jeff Rush, California Joint Powers Insurance Authority (an associate member); Mary Beth Pittinger, CHUBB; Christopher Thurman, CNA Insurance; Chris Champlin, EMPLOYERS; Tim Roberts, Everest Insurance; Julie Riddle, The Hartford; Dr. Mary Capelli-Schellpfeffer, Liberty Mutual Insurance; Justin Smith, North American Casualty Company; Paul Gladden, Pie Insurance; Gene Simpson, Republic Indemnity Company of America; Brooks Rice, Schools Insurance Authority (an associate member); Scott Lange, Sentry Insurance; Joanne Moynihan, Travelers; Michele Halstenrud, WCF Insurance; and Neil Deblock, Zürich North America. News Release (4/4/25) (public) CWCI Q1 2025 Quarterly Summary. Quarterly listings of all CWCI publications, including publication dates, summaries of each topic and the various formats in which the information is available (e.g., research report, Bulletin, Exec Briefing, news release), so users can choose the level of detail they want to view. Listings include live links so users can click into the CWCI website to access specific documents quickly and easily. |