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The Current and Possible Future Impact of COVID-19 on Workers’ Compensation

open sign for business during pandemicThe COVID-19 pandemic has had a huge impact on workers’ compensation claims. It has affected everything from how claims are handled, types of claims being filed, staffing models and how treatment is being provided.

According to an article by Insurance Thought Leadership.com, the pandemic has changed so much it is unlikely things will go back to how they were at the beginning of the year before the virus spread.

If you contracted COVID-19 on the job or suffered any other work-related injury or disease, the Harrisburg workers’ compensation lawyers at Schmidt Kramer may be able to help you. Call today to schedule a free legal consultation with no obligation to file a claim.

Changing Definition of Workers’ Compensation

The definition of workers’ compensation has changed over time. The pandemic is just the most recent catalyst for change.

When workers’ compensation started, it was meant to cover workplace accidents. Since then, it has expanded to include occupational diseases (chronic conditions caused by work activities or workplace conditions).

Many states have expanded their workers’ compensation systems to cover injuries that develop gradually and are not the result of one catastrophic incident. That is why claims involving repetitive trauma are quite common in many places.

Fast forward to present day, and workers’ compensation insurance has provided compensation for employees who contracted COVID-19. (Review this FAQ page created by Pennsylvania’s Office of Unemployment Compensation about workers’ compensation and COVID-19.) Some states have said COVID-19 will be considered work-related for certain jobs. That means these workers do not have to prove their disease is related to their jobs. The burden of proof shifts to employers to prove the condition is not work-related.

These claims may make it possible for employees to file claims for infectious diseases besides COVID-19.

Reinsurance Exclusions

Reinsurers have been trying to exclude the pandemic from coverage, like what they did after 9/11 by trying to exclude terrorism from workers’ compensation.

Reduction in Employer Payroll

The COVID-19 pandemic has been devastating to many sectors of the economy, resulting in significant job losses. One side effect of more people being unemployed is a decrease in payrolls. This may present a significant challenge to the workers’ compensation industry, because it is closely tied to employer payrolls.   

The question is: will the economy ever go back to the way it was in 2019, before the pandemic hit?

Volume of Claims

The volume of workers’ compensation claims has shrunk considerably. Despite a slight bounce back, claim volume is still far below 2019 levels. The reduction in revenue may cause more industry consolidation.   

However, in certain industries, claim volume has increased. For example, claims from first responders have increased tremendously. This is not just because of the pandemic but also because of injuries first responders suffer when dealing with civil unrest.

Claims from those working in the health care industry are also up. Some supermarkets and big box stores have had to expand their payrolls to cover an increase in claims, as have trucking and shipping businesses.

While some people lost their jobs or could not work because of lockdowns, those in construction and the public sector kept working. Claims from people in these industries have not decreased.

Claims for COVID-19

Most COVID-19 workers’ compensation claims are coming in the health care industry, as you would expect. The other industry that is right behind health care in terms of COVID-19 workers’ comp claims is first responders, which includes police, firefighters and paramedics. The National Fraternal Order of Police says 247 law enforcement officers died from COVID-19, as of the end of October.

While most of these claims do not cost insurers much, when someone dies or has to stay in the intensive care unit for an extended period of time, benefits can cost hundreds of thousands of dollars.

There are still unanswered questions about these claims: will some of those who contracted the virus file for permanent partial or permanent total disability benefits?

Telemedicine

Telemedicine has been critical as the workers’ compensation industry works to adapt to the pandemic. It is possible this will continue even after the pandemic has subsided.

Have Questions About Your Workers’ Compensation Claim? Call Schmidt Kramer

We are here to help if you were injured while doing your job. There is no risk because there are no upfront fees or obligations. We have extensive knowledge of Pennsylvania’s workers’ compensation system and how to validate claims.

Schmidt Kramer. Licensed. Local. Lawyers. Call (717) 888-8888.