MiScorecard Performance Summary (March 2015)

Michigan Workers Compensation Agency (WCA) evaluation based upon misplaced priorities and where changes need to be made.

dashboardGovernor Rick Snyder implemented Mi Dashboard to provide a quick assessment of various state agencies.

The WCA has now released its March 2015 performance summary and we think it’s based upon misplaced priorities. Here are the four metrics used and how they miss the mark.

1. Cost Per Claim

This metric shows 11.5% growth over a 4 year period. The agency gives itself a passing grade (green) because it is less than the target of 25% growth.

We think cost per claim is an important factor but it does not take into consideration the adequacy of benefits paid. Legislative changes in 2011 allow insurance companies to subtract phantom wages from jobs that are not actually provided.

Many of our clients are now receiving far less than 80% of their after-tax average weekly wage. This has caused tremendous hardship for Michigan families struggling with workers compensation.

2. Cost of Premium Ranking

The WCA gets a fair score (yellow) because it is currently ranked 32 out of 50 states for cost of premium (1 (highest) to 50 (lowest)). The target is to get Michigan into the top ten cheapest states for workers compensation insurance.

This metric is misguided because it is comparing apples to oranges. We should not be in a race to the bottom with all fifty states. When compared to states that Michigan competes with for business, our workers compensation system provides a better value proposition for cost of medical care and outcomes.

The pure premium rate has also dropped nearly 28% in the last 3 years. This has saved Michigan businesses over $200 million dollars.

3. Process Improvement

The WCA gets a failing grade (red) because it has not hit 50% for electronic data compliance filings. It currently sits at 26.5% of target.

We agree that modernization is not happening fast enough. Governor Rick Snyder should allocate more money to the WCA budget and get serious about technology upgrades. Other states have created Internet portals so that parties can check on status of claims and do other electronic filings.

4. Duration of Temporary Disability

The WCA receives a fair score (yellow) for reducing duration of disability from 17.8 to 17 weeks. The target is 15 weeks of temporary disability.

We think duration of temporary disability is only half the story and the wrong metric for measuring success. Just because an insurance company stops payment does not mean a person is recovered. We need to focus on how long it takes for individuals to get back to gainful employment and what improvements can be made to assist with this process.

Michigan Workers Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled workers exclusively for more than 35 years. Call (855) 221-2667 for a free consultation today.

Related information:

WCA: MiScorecard Performance Summary

 

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