At the recent Workers’ Compensation Research Institute (WCRI) Annual Conference in Phoenix, Alex Swedlow of the California Workers’ Compensation Institute (CWCI) presented key findings on the current state of California’s workers’ compensation system. His presentation highlighted significant improvements in efficiency and cost control while acknowledging persistent challenges in the nation’s largest workers’ compensation market.

Claim Dynamics and Post-Pandemic Recovery

California has returned to pre-pandemic claim volumes, with COVID-related claims now reduced to nearly zero. The system has stabilized after the volatility experienced during the pandemic years, with medical inflation and utilization rates leveling out.

A notable improvement is California’s closure rate for claims. Once “infamous” for claims that remained open indefinitely, California is now much closer to other states in claim closure rates even at 12, 24, and 36 months of development.

Medical Care Trends

The presentation highlighted several positive developments in medical treatment patterns:

• Reduction in Inpatient Services: California has seen a 52% decrease in inpatient discharges, twice the decline rate of the entire state healthcare system. This shift has been accompanied by appropriate increases in outpatient surgeries.
• Spine Surgeries: A 62% reduction in inpatient spine surgeries followed the removal of perverse financial incentives that previously required payers to pay twice for surgical hardware.
• Physical Medicine and Office Visits: Utilization has remained stable before, during, and after the pandemic, suggesting consistent access to care.

Pharmaceutical Progress

One of the most dramatic improvements has been in pharmaceutical management, particularly opioids:

• A 72% decrease in opioid prescriptions over a 14-year period
• A corresponding 71% increase in anti-inflammatory medications
• A 94% reduction in the percentage of claims with opioids in the first 12 months
• Only 3.7% of workers’ compensation patients receiving opioids were simultaneously obtaining opioids from another healthcare system, down from higher rates in 2017

These findings were based on special access to California’s Prescription Drug Monitoring Program (PDMP), which provided data on 240 million prescriptions between 2016 and 2023.

Dispute Resolution Challenges

Despite improvements in medical care efficiency, California continues to struggle with high litigation rates and medical disputes:

• California ranks in the top three or four states for litigation or attorney involvement rates for indemnity claims
• A 2021 fee schedule update for Medical-Legal evaluations led to a 51% increase in comprehensive exam costs and created incentives for excessive documentation
• Independent Medical Review (IMR) implementation has not reduced disputes as anticipated:
  • California processes 101 times more IMR decisions than Texas despite being only one-third larger in population
  • California has 68 times the volume of medical decision disputes compared to group health plans, Medicare, and Medicaid combined, despite being only 1/140th their size
  • The top 10 providers filing IMR challenges account for one in nine of the entire volume of 124,000 disputes
  • 95% of IMR letters are generated by applicant attorneys rather than physicians themselves

Climate and Workplace Injuries

The presentation addressed recent legislative attempts to create heat-related presumptions for agricultural workers, noting that between 2019 and 2023, there were only 659 heat-related injuries in the agricultural sector, representing just 0.6% of claims. Analysis showed this rate was consistent with other outdoor industries, suggesting current OSHA standards implemented in 2005 may already be addressing the issue effectively.

California in Context

When compared to other states, California shows both improvements and ongoing challenges:

• California has moved from being the highest-cost state for medical expenses on indemnity claims to being in the top third
• Indemnity costs have fallen closer to median levels
• Premium rates have fallen from first to third highest in the nation
• California remains #1 in permanent partial disability claim frequency and in the cost to deliver benefits (loss adjustment expenses)

Cultural Factors Affecting System Performance

Swedlow presented a fascinating correlation between state performance and what researchers call “cultural tightness and looseness.” This measure, developed by Stanford researcher Michelle Gelfand, scores states based on rule enforcement, tolerance for diversity, economic conditions, and other factors.

California scored as the “loosest” of all 50 states, meaning it has less rigid rule enforcement and greater tolerance for diversity. This cultural characteristic correlates strongly with higher workers’ compensation costs and permanent partial disability rates.

Conclusion

The presentation concluded that California’s workers’ compensation system has “greatly improved the efficiency, price, consistency and selection of higher quality medical care,” while acknowledging that distinctive aspects of California’s culture and approach to governance continue to influence system outcomes. Despite significant progress, California remains an outlier in several key metrics compared to other states.

Republished from BobsClutteredDesk.com. Artificial Intelligence aided in the development of this article.

Poor Gen Z. Everybody seems to pick on them. It is, I suppose, a rite of passage of some sort. Every generation is generally critical of the ones that follow it. And as I wrote last week, Gen Z has four other opinionated and domineering generations before it in the workplace. And one of those generations, the Boomers like me, actually know what we are talking about. Those Gen Z sissy pants better suck it up. It won’t get better until they start having children and screwing up a new generation of their own – just like the rest of us have done for, well, generations.

There is already a generation following Gen Z; the “Alphas.” So even if Gen Z can’t reproduce due to their lack of ability to develop interpersonal relationships, they will still have a subsequent generation to demean and belittle. It should be easy – raised in a total immersion of technology and AI, Alpha’s will basically be cyborgs. But I digress….

A news article recently disclosed significantly rising sick day trends among Gen Z employees, who are increasingly prioritizing health, mental well-being, and work-life balance. HR data reveals a 42% increase in sick leave usage from 2019, particularly among younger workers. Some HR systems report a 55% increase. Experts attribute this shift to burnout, a desire for community in the workplace, and a greater openness to mental health days. Many Gen Z workers also favor jobs that support physical and psychological well-being, with some willing to accept lower salaries for better balance.

So much to break down here. First, in all fairness to Gen Z, sick days in the post-Covid era have taken on an entirely new importance. Prior to Covid (re: “In my day….”), employers generally didn’t care if you were sick; they expected you to work. Lost your thumb in a chainsaw incident? Duct tape it on and come on in. We’ll let you go to Urgent Care during your lunch, but we really need to get the Fussmucker quote out this morning. Come down with the plague? Well, we really need your report by end of day. Just try not to cough or vomit on anyone.

Today, however, post-COVID, coming to work with the sniffles is enough to make your HR rep apoplectic, which, ironically, might result in a sick day for them. Taking a sick day now is far more acceptable, not just from the employee’s perspective but also from the employers. It is possible we actually learned a lesson during the pandemic. 

Except for us Baby Boomers, of course. We already knew everything.

But Gen Z appears to be the group who took this lesson to heart. After all, even given the societal change in attitudes, an almost 50% increase in just a few years is significant. And, with Gen Z being the group most likely to use those sick days, it does say something about their beliefs and priorities. 

According to the article:

“The average amount of time taken off for sick leave has also increased by 15% since 2019, reaching an average of 15.5 hours per year. Another HR platform, Dayforce, reported a 55% increase in sick leave during the same time frame, based on its users’ activity. Among white-collar workers, Dayforce saw a 42% spike in sick leave among white-collar workers since 2019. Workers ages 25 to 34 years old were the most likely to take advantage of these benefits.”

Oops. 25 to 34 years old? Gen Z’s average age currently tops out at around 28. It would appear that some younger Millennials are also getting in on the action.

While some experts believe this increased use of sick days is a sign of proper and responsible health care, others are not so sure. One speculated that the cause of younger workers calling in sick may be attributable to “burnout,” which, if true, only amplifies the stereotype that Gen Z’s struggle to manage stress far more than their predecessors. 

Somehow, I feel as though we’ve come full circle back to “Suck it up sissy pants.” But that could just be coming from a Boomer who, by the very nature of his generation, knows more than all those who followed him.

Nevertheless, time marches on, and with that come unique changes to the workplace. Employers will need to recognize the differences in needs and priorities of different generations in their employ, and those changes will become more pronounced as more young people come of age and enter the workforce. 

It’s enough to make your head spin – which ironically for younger employees, may prompt them to take the day off.

Originally published at www.bobscluttereddesk.com.