Workers' compensation payments for medical care and cash benefits for U.S. workers injured on the job increased 4.4 percent to $57.6 billion in 2008, according to a study released by the National Academy of Social Insurance.
For the first time, medical benefits accounted for more than half (50.4 percent) of all benefits paid.
An 8.8 percent increase in payments for medical care drove medical spending to $29.1 billion in 2008 (the most recent year with complete data), while wage replacement benefits paid directly to injured workers rose by 0.3 percent to $28.6 billion.
"The growth in medical spending may reflect both higher prices for medical care and greater use of services," said John F. Burton, Jr., chairman of the panel that oversees the NASI report. "The increase is the continuation of a long-term trend since 1980, but this is the first year that payments for medical care were more than half of all workers' compensation benefits."
Employers nationwaide paid $78.9 billion for workers' compensation, a decrease of 6.7 percent from the previous year.
As workers' compensation cash benefits as a share of covered payroll declined over the years, Social Security benefits continued to rise, according to the NASI. Officials say this trend, occurring during much of the last 25 years, raises the question of whether retrenchments in one program increase demands placed on the other, and vice versa.
"The ‘substitutability’ of Social Security disability benefits and workers' compensation cash benefits for workers with severe, long-term disabilities that are work-related or might be exacerbated by the demands of work is an important question for researchers and policy makers" Burton said.
The report, “Workers' Compensation: Benefits, Coverage and Costs, 2008,” is the 13th report in the NASI series.