Iowa, Minnesota Ranked As Most Effective WC Systems in Nation

The workers' compensation systems in Iowa and Minnesota are the most effective in handling claims, according to a national study by the Work Loss Data Institute. On the other hand, Illinois, Wyoming, Rhode Island and New York performed poorly and ranked near the bottom of the list.

The Encinitas, Calif.-based independent database development firm recently issued its 2009 State Report Cards for Workers' Comp. The study is based on data from Occupational Safety and Health Administration Form 300s and 200s, which cover all recordable injuries and illnesses and provide the basis for rating state-by-state workers' comp performance. This is the third report from the Work Loss Data Institute, spanning the years 2000-06. The seven-year period, officials said, made it possible to track trends and not only give states a grade based on most current performance but also to assign them a "tier ranking" based on how they performed on average.

Determining grades. Similar to previous reports, the 2009 State Report Cards for Workers' Comp was derived by scoring each state on five outcome measures -- incidence rates, cases missing work, median disability duration, delayed recovery rate, and a key condition of low back strain.

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According to the report, the study subjects were assigned the following grades:

A. Iowa performed the best of all the states for 2006, and Minnesota came in a close second. Both states received a grade of A+ based on an average of their scores in the five categories. Other states that received an A included Missouri, Virginia, Alabama, New Mexico, Utah and Nevada.
B. Vermont, Indiana, North Carolina, Arkansas, Kansas, Nebraska and Arizona were among the states that received a B.
C. The states that received a C included Alaska, Washington, Montana, Wisconsin, Michigan, Georgia, Florida, Connecticut and Maine.
D. Oregon, California, Texas, Kentucky, Tennessee, South Carolina, Delaware, Hawaii and Maryland were among the states that received a D.
F. Illinois came in last, with Wyoming, Louisiana, Oklahoma, Rhode Island, West Virginia, Massachusetts, New Jersey and New York receiving a F.

In terms of the new tier ranking system, the Tier I states included Iowa, Kansas, Minnesota, Utah and Virginia. Tier I means that the state had an average grade of B+ or better and a trend of going up or remaining level. Officials said those five states were doing great and are continuing to improve.

Eight states fell into the opposite category -- Tier VI -- which meant that they had an average grade of D- or worse and a trend of going down or remaining level. According to the study, the worst performers for the years 2000-06 were Illinois, Louisiana, New Jersey, New York, Oklahoma, Rhode Island, Texas and Wyoming.

Among those states not participating for the year 2006 were Colorado, Idaho, Mississippi, New Hampshire, North Dakota, Ohio, Pennsylvania, and South Dakota.

Iowa touts program. Iowa workers' comp officials touted the results of the survey, noting that the state has consistently been recognized as having a fair and balanced system. Christopher J. Godfrey, commissioner of the workers' comp system, said the state is committed to providing impartial assistance in education, compliance and adjudication to both businesses and workers. The result, he said, is that Iowa remains one of the states with the lowest premium rates and highest compensation rates for injured employees.

"The combination of all of the factors makes Iowa a great place for business growth and provides a valuable safety net for injured workers," Godfrey said. "Because of this, Iowa is frequently considered a model program and other states work to achieve our success."

Business advocates from Oklahoma, which ranked near the bottom, were less pleased with the findings. Mike Seney, senior vice president of operations for The State Chamber of Oklahoma, said the report confirmed the fact that workers' comp remains a primary negative economic impact issue in the state.

"Businesses considering moving to Oklahoma look at these figures and with tight competition in the current state of the national economy," he said. "We cannot afford to pass on reform."

Read more at the WORKERSCOMP Forum^TM homepage.

September 10, 2009

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