Keenan Blog

2017 Workers’ Compensation Survey Reveals Data to Improve Results

September 26, 2017

The workers’ compensation environment in California is complex and ever-changing. Hospitals and other employers face a variety of challenges to keep pace. But a new survey co-authored by Keenan HealthCare is helping to shed light on the current landscape.

Keenan HealthCare and Milliman, one of the world’s largest independent actuarial consulting firms, have released the 2017 results of their California Hospital Workers’ Compensation and Payroll Benchmarking Survey. The report provides industry-wide benchmarks to drive decision making and support fundamental considerations related to workers’ compensation.

The 2017 survey includes data from 18 hospital systems and over 44 individual facilities within California. In aggregate, they provided data on over 4,300 annual claims. The survey analysis also relied on payroll and medical utilization information obtained from the California Office of Statewide Health Planning and Development (OSHPD) website.

The survey identified key workers’ compensation trends in the hospital sector, which can help both employers and hospitals make more informed decisions regarding workers’ compensation.  These trends include the following:

  • Projected loss cost for accidents occurring during 2016 and 2017 are $2.10 per $100 of payroll. Average losses paid per indemnity claim increased 2.9% annually over the past 10 years.
  • Medical loss trends abated in recent years. Indemnity loss trends are less than long-term averages. Combined, these have resulted in a lower annual rate of severity increase as compared to prior versions of this study.
  • However, annual Allocated Loss Adjustment Expenses (ALAE) increased significantly during this time period, representing an increasing share of the total cost of claims.

Looking forward, we expect longer term trend rates closer to 5% or 6% to prevail, with stronger medical and indemnity loss trends than the recent past, and ALAE trends remaining high. We believe these key indicators will be valuable in developing plans to modify or adjust programs where necessary, with the goal of improving results.

Hospitals are already applying the findings of the Keenan-Milliman California Hospital Workers’ Compensation and Payroll Benchmarking Survey toward strategic and tactical approaches in their loss prevention and claims management. The Survey provides a data-driven opportunity to identify strategies for optimizing the performance of workers’ compensation programs throughout the state.

About Bill Poland
Bill Poland is Marketing Director, Property & Casualty for Keenan. To learn more about California hospital workers’ compensation trends, please contact Bill Poland ( or Dan Mattioli (