Workers' Compensation ADR Programs

A 2015 workers' compensation study by Martindale-Nolo Research^® found that claims with injured workers who hired attorneys averaged 47% longer to resolve than claims without attorneys; a time cost to injured workers of nearly 6 months.

According to WCRI’s CompScope™ Benchmarks, 19th Edition, defense attorney and medical cost containment expenses (i.e., the employer’s litigation expenses) for California in 2015 averaged $10,000 per injury claim across all industries, which continued a significant upward trend since 2005.

Correspondingly, the 2018 State of the System by the California WCIRB reported that litigation expenses represented 21.6% of the total insurance cost in California’s workers’ compensation system. Defense attorney expenses were double that of injured worker attorney fees and “the $3.5 billion of [litigation] costs paid in 2017 exceeds the cost of paid indemnity benefits (after excluding [injured workers'] attorney fees which are typically reported in indemnity benefits).” Compared to 2016, attorney fees and expenses increased 4.8% in 2017 and seized a larger portion of total litigation expenses for California's workers' compensation claims.

In his message to the workers’ compensation community in April 2019, the President and CEO of the WCIRB, Bill Mudge, stated “[California's] costs for claims handling and [litigation] are the highest across all states’ workers’ compensation systems, are greater today than the annual cost of paid indemnity benefits to injured workers and, in total, are more than double the cost to provide a dollar of benefits compared with the median state workers’ compensation system in the United States.”