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How Much is Worker’s Compensation Costing You?


By Truven Staff/Thursday, January 21, 2016

EMPAQ® (Employer Measures of Productivity, Absence and Quality™) is an employer-developed and driven-measurement tool. Workers' compensation is a critical issue for employers, which is why National Business Group on Health (the Business Group) and Truven Health Analytics partnered to conduct a study to determine the financial impact workers' compensation has on companies.

EMPAQ tracked average annual claim incidence per 100 full-time employees (FTE), average cost per FTE, and average lost Temporary Total Disability (TTD) workdays per 100 FTEs in its research.

We found that:

  • The average workers’ compensation incidence rate was highest in the healthcare industry. Healthcare employees saw 5.56 claims per 100 FTEs versus 3.56 per 100 for all other industries combined.  
  • The energy and utilities industry had fewer, but more expensive claims: Their claim-incidence rate was 34 percent lower than the all-industry average, but their cost per FTE was 70 percent higher.
  • There was also a lot of variation in the average lost workdays for workers’ compensation per employee across industries.
Using EMPAQ Data to Improve the Company

By leveraging EMPAQ data you can improve the health and wellness of your employees. To keep workers’ compensation costs under control:

  • Consider a wellness program – Employers who offered a wellness and fitness program had an average workers’ compensation cost of $323, which is 21 percent lower than firms without programs.
  • Leverage on-site clinics – Employers who provided access to on-site clinics saw a reduced rate of lost workdays per FTE, with a 0.39 correlation.

EMPAQ provides employers with a framework by which to measure and monitor the return on investment they’re receiving from their human capital investments. The EMPAQ insight report delivers an overview of the EMPAQ metrics for program year 2014. It was developed by analyzing responses to EMPAQ surveys from more than 100 large employers representing nearly 4 million employees. For more information, download the Insights Report or visit EMPAQ.org. 

The EMPAQ data collected for 2014 included information for four distinct categories, including workers’ compensation, and six key health and productivity programs. Organizations that participate in the survey process receive a customized benchmarking report. Download a sample customized report.

 


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