Workers' compensation: coverage, benefits, and costs, 1990-91

Workers' compensation programs provide protection to workers and their families. The programs compensate for lost wages and medical expenses incurred as a result of work-related injuries or illnesses. Survivor benefits are also provided when the disabilities result in death. In 1991, about $16.8 billion in medical benefits and $25.3 billion in wage-loss compensation was paid in settlement of claims filed for disabled or deceased workers. These benefits were paid by private carriers, by State funds, or by self-insuring companies as determined by laws in each State. The employer's cost of providing workers' compensation coverage generally varies according to risk, industrial classification, and experience rating. Nationally, such costs were approximately 2.4 percent of payroll or about $590 for each of the 93.6 million protected employees. This article examines the recent changes in coverage, in benefit levels, and in employer costs and the factors influencing such changes. Over the past decade, workers' compensation benefits have increased by 157 percent and employer costs by 143 percent. In the same period, the number of covered employees has risen 22 percent and the amount of covered wage and salary payroll, 77 percent.