Thanks to major reforms pushed by the Michigan Chamber in 2011, Michigan’s workers’ compensation costs per claim are lower than that of typical states, according to a study released in May 2015 by the Workers’ Compensation Research Institute (WCRI).
The study compared workers' compensation claims and found costs per claim in Michigan were the lowest among the 17 states studied, with the average claim size falling over a three-year period. This report proves the 2011 reforms championed by the Michigan Chamber have worked, giving our state a competitive edge for its workers’ compensation system. This will improve efforts to attract businesses and economic growth.
- After 36 months, the average 2011 Michigan claim was four percent lower than similar claims from 2008. That was the largest decrease of all states WCRI studied. The typical state’s claim costs rose eight percent over that period.
- Between 2008 and 2011 (claims evaluated as of 2014), indemnity benefits per claim decreased 12 percent, benefit delivery expenses per claim decreased five percent, and the average medical payment per claim rose nine percent.
- All three cost components were below the median of the 17 states WCRI studied. Indemnity benefits per claim were 22 percent lower than the typical study state. Medical benefits per claim were 34 percent lower, and benefit delivery expenses per claim were 21 percent lower.
Furthermore, in October of 2016, the Michigan Department of Licensing and Regulatory Affairs reported that the pure premium advisory rate for workers' compensation had decreased 39 percent since 2011, saving Michigan employers an estimated $290 million.
These reductions in costs are a direct result of major legislation pushed by the Michigan Chamber and signed by Governor Snyder in 2011 that reformed the state's workers' compensation system. View a summary of the key changes.
Chamber Leadership on Workers' Comp Reforms Pays Dividends: 33% Drop in Rates Saves Job Providers Millions, Michigan Chamber of Commerce, October 2015
Workers' Comp Report Shows Michigan's Costs Lowest Among Study States; State's workers' compensation system continues to be an economic asset in terms of attracting and retaining businesses, Michigan Dept. of Licensing & Regulatory Affairs (LARA), June 2, 2015