Health care industry presents tremendous opportunities

The health care industry will be one of the most important sources of exposure growth for workers' comp insurers in the next decade, according to Robert Hartwig, president of the Washington, D.C.-based Insurance Information Institute.

Hartwig told attendees at a recent conference that insurers and third-party administrators might want to rethink their reluctance to take on risks in the health industry.

"About 4 million jobs will be created in the health care business through 2018," Hartwig said. "There will be a huge reallocation of resources."

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Speaking in Orlando at the annual conference of the Florida Workers' Compensation Institute, Hartwig said insurers that have shied away from nursing homes and other health-related risks because of their relatively high exposures will miss out if they don't take a stake in that business.

Along with health care, Hartwig said the fastest growing occupations from 2008 to 2018 are expected to be dominated by science and technology:

Biomedical engineers.
Network systems and data communications analysts.
Home health aides.
Personal and home care aides.
Financial examiners.
Medical scientists, except epidemiologists.
Physician assistants.
Skin care specialists.
Biochemists and biophysicists.
Athletic trainers.

High-exposure industries, including construction and manufacturing, have been hardest hit by the economic recession, Hartwig said, reducing workers' comp premiums drastically. Overall, the country lost more than 8 million jobs between December 2007 and December 2009. "The recession caused the largest impact on workers' comp exposure in 60 years," he said.

On the positive side, Hartwig said he does not expect a double-dip recession, as some economists have speculated. He expects economic growth this year and next to be "tepid," and it will likely take five years for the nation's unemployment rate to drop back down to 5 percent, barring any debacles.

"Labor market conditions are much, much better than they were 18 months ago," he said.

Read more at the WorkersComp Forum homepage.

October 21, 2010

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