Are Insurer Risk Control Services Effective?

Workers’ Compensation Risk Control

Workers’ compensation insurance systems provide medical care and lost-time wage payments for workers who are injured or become ill due to work. Workers’ compensation insurers also provide employer risk control services including:

• Onsite risk assessment visits
  • Video-based safety and ergonomic job analyses
  • Industrial hygiene air/noise sampling, and physical hazard assessments
• Safety program development
• Training

The main purpose of risk control service is to assess risks and recommend ways to eliminate or reduce workplace hazards. Risk control services are required by some states, usually at no cost beyond the insurance premium.

Workers’ compensation insurers are the largest providers of health/safety services in the United States, reaching thousands of employers each year. Although many employers may never receive a visit from regulators such as the Occupational Safety and Health Administration, they may have regular contact with their insurer risk control staff.

Even though  workers’ compensation insurers are the largest and most longstanding providers of safety/health services, few research studies have been conducted to determine whether the services are actually effective for preventing or reducing injuries and illnesses.

The partnership between the Ohio Bureau of Workers’ Compensation (Ohio Bureau) and the National Institute for Occupational Safety and Health (NIOSH) Center for Workers’ Compensation Studies offered an opportunity to conduct this research. A recently published journal article examines the effect of risk control visits on workers’ compensation claim numbers and costs.

The Ohio Bureau is the largest of four exclusive state-run workers’ compensation systems in the United States and provides workers’ compensation insurance for most Ohio workers. Onsite risk control services for safety, industrial hygiene, and ergonomics are some of the most popular Ohio Bureau programs. From 2006-2017, the Ohio Bureau employed an average staff of 93 (48 industrial safety specialists, 25 industrial hygienists, and 20 ergonomists), who conducted 187,846 visits and provided 446,825 hours of services to an average of 4,582 employers each year.

What We Did

We designed a study to evaluate the impact of the Ohio Bureau’s onsite risk control services on insured employers’ workers’ compensation claims. We used two methods to analyze 2004-2017 workers’ compensation claims data from 4,606 employers that received risk control visits over time.

Method 1 compared the number and cost of claims in employers receiving risk control services to matching employers (based on industry, employer size and workers’ compensation claims history) that did not receive risk control services for a two-year period.

Method 2 followed the employers who received multiple risk control services over a longer time period and estimated the impact of each individual risk control visit on workers’ compensation claim numbers and costs. The decline in claims and costs for individual employers following each service they received was compared to the average rate of decline in claims and costs for the whole group of employers during periods when no additional service was received.

What We Found

The relative total number of workers’ compensation claims per 100 employees remained similar after risk control services under both methods, while the relative number of workers’ compensation claims with lost-time (with 8 or more days away from work) per 100 employees either remained similar or significantly decreased. Finally, the cost of workers’ compensation claims per employee significantly decreased under both methods. The impact of risk control services on reducing workers’ compensation costs per employee became greater up to the fourth visit but then reduced, as shown in Figure 1 below.

The study had some limitations. The risk control services were provided to volunteer employers who often requested services after an increase in workers’ compensation claims. Employers who voluntarily participated may have had commitments to safety that could have impacted losses. Increases in workers’ compensation claims may be followed by decreases in claims without any safety improvements. Some of the effect attributed to risk control service may have also been due in part to employer participation in other Ohio Bureau safety programs and prior service. We controlled for many of these issues, but the findings may not apply to all insurers and employers.

Conclusions and Next Steps

The Ohio Bureau risk control consultation program was effective in reducing workers’ compensation cost rates and controlling or reducing severe injuries for serviced employers. This represented one of the largest and most comprehensive risk control studies completed to date and the findings are consistent with other research conducted on insurer risk control services and related regulatory visits. We encourage workers’ compensation insurers to continue offering or expand such risk control services and urge employers to take advantage of the services that are often already included as part of their insurance premium.

NIOSH will continue to work with the Ohio Bureau and other insurers on several research questions:

• How do insurers provide risk control services to the most employers possible with a limited risk control service staff?

• What is the impact of different types of risk control services (ergonomic, safety, industrial hygiene)?

• Do employers of particular sizes and industries benefit from risk control service more than others?

• Can new technology (remote video-based systems, drones, and wearable sensors) be used to expand and improve risk control services?

 We are interested in your experience and opinions on risk control services. Please let us know what you think below.

Steven J. Wurzelbacher, PhD; Stephen J. Bertke, PhD; P. Timothy Bushnell, PhD, MPA; and Libby L. Moore, PhD;  are with the National Institute for Occupational Safety and Health

Michael P. Lampl, MS; David C. Robins, AAS; and Steven J. Naber, PhD; are with the Ohio Bureau of Workers’ Compensation.

More Information:

NIOSH Center for Workers’ Compensation Studies (CWCS)

• Contact: cwcs@cdc.gov

Ohio Bureau of Workers’ Compensation (Ohio Bureau)

References

Moore LL, Wurzelbacher SJ, Shockey TM. Workers’ compensation insurer risk control systems: opportunities for public health collaborations. J Saf Res. 2018;66:141–50. DOI: 10.1016/j.jsr.2018.07.004

Shockey TM, Babik KR, Wurzelbacher SJ, Moore LL, Bisesi MS. Occupational exposure monitoring data collection, storage, and use among state-based and private workers’ compensation insurers. J Occ Env Hyg. 2018;15(6):502-509. DOI: 10.1080/15459624.2018.1453140

Wurzelbacher SJ, Bertke SJ, Lampl MP, Bushnell PT, Robins DC, Naber SJ, Moore LL.  The Impact of a State-Based Workers’ Compensation Insurer’s Risk Control Services on Employer Claim Frequency and Cost Rates. J Occ Env Med. 2022;64(7):562-572. DOI: 10.1097/JOM.0000000000002508