Keenan and Milliman Release First Annual “California Hospital Workers’ Compensation Benchmarking Report” with 12-Year Data and Trend Analysis

TORRANCE Calif. – May 13, 2014 – Keenan, the largest privately held insurance brokerage and consulting firm in California and Milliman, one of the world’s largest independent actuarial consulting firms, has released its first annual California Hospital Workers’ Compensation Benchmarking Report. The report was designed by the Keenan Healthcare division and Milliman’s Property and Casualty Practice. The purpose of the report is to provide industry-wide benchmarks for the fundamental considerations from which informed decisions related to workers’ compensation and maintaining appropriate risk can be made.

“Hospital risk management, including the protection of employees from injury or illness in the delivery of care, requires hospitals to look closely at questions related to taking fully insured, partially self-funded or self-insured positions,” said Bill Poland, Property & Casualty Marketing Director of Keenan HealthCare. “As these facilities are well aware, workers’ compensation laws in California make that choice increasingly complex and important.”

The report provides an in-depth look at key factors including claim frequency and severity, impact of reforms, medical and indemnity costs, and allocated loss adjustment expense over the past 10-12 years. Also included is data on payroll and utilization, age, occupation, litigation status, cumulative trauma and future medical claims.

General trends identified in the report include:

  • Overall losses per $100 of payroll were largely the same in 2013 as in 2004, with severity of claims on the rise while claim frequency declined.
  • Losses as a function of payroll appear to have bottomed out in 2008.
  • Reforms in 2003 reduced losses as a function of payroll by approximately 40%.
  • Projected 2014 loss cost per $100 of payroll at $2.65

“The workers’ compensation landscape in California is unique and introduces various complexities for employers, and especially for hospitals,” said Richard Lord, Principal and Consulting Actuary with Milliman. “These kinds of benchmarks can help hospitals optimize their programs and better understand emerging trends in workers’ compensation costs.”
The report’s data and conclusions are based on a survey of 18 hospital systems or individual facilities in California comprising 35 facilities in total and aggregate data on over 3,000 annual workers’ compensation claims. To facilitate data analysis on a consistent basis among all participants, the survey relied on payroll and utilization information obtained from the California Office of Statewide Health Planning and Development.

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About Keenan
Founded in 1972, Keenan is the 17th largest insurance consulting and brokerage firm in the U.S., and the largest independent broker in California. Keenan is dedicated to providing superior insurance products and services to schools, community colleges, healthcare organizations and municipalities for employee benefits, health benefit management services, workers’ compensation, risk management, and property and liability. With headquarters in Torrance, CA, Keenan has a staff of more than 650 insurance specialists and branch offices in Riverside, San Clemente, Oakland, San Jose, Rancho Cordova, Redwood City, Pleasanton and Eureka. For more information, call 800-654-8102 or 310-212-3344, email or visit

About Milliman
Milliman is among the largest providers of actuarial and related products and services. The firm has consulting practices in healthcare, property & casualty insurance, life insurance and financial services, and employee benefits. Founded in 1947, Milliman is an independent firm with offices in major cities around the globe. For further information, visit