On a biennial basis, the Oregon Department of Consumer and Business Services produces a workers’ compensation premium rate summary of all states. The 2016 Oregon Report was published in October 2016. It essentially ranks states from the highest premium to the lowest. California is the highest (#1) and North Dakota is the lowest (#51).

The workers’ compensation insurance industry has argued that physician dispensing of medication is a major cost driver and should be regulated or abolished. The 2016 Oregon Report does not support this claim.

According to the National Council of Compensation Insurers (NCCI), the states with the highest level of physician dispensing include Florida, Georgia and Maryland. According to the Oregon report, Georgia is #27 and its premiums are below the median of all states; Florida is # 33 and Maryland is number # 38 and their premiums are substantially below the median (90% and 82% of median respectively).

The principal cost drivers in workers’ compensation are not physician dispensed medications.  Indeed, data from the Workers Compensation Research Institute (WCRI) indicates that physicians who dispense medications from their offices give out fewer pills per claim than doctors who write prescriptions to be filled at a pharmacy.  Dispensing doctors more carefully monitor patient recovery and are a positive force in the system.

The Report’s state by state ranking appears below:

Table 2. Workers’ compensation premium rate ranking

 

2016

Ranking

2014

Ranking

 

State

Index Rate Percent of study median  

Effective Date

Percent of 2014 study median
1 1 California 3.24 176% January 1, 2016 188%
2 3 New Jersey 2.92 158% January 1, 2016 152%
3 4 New York 2.83 154% October 1, 2015 148%
5 2 Connecticut 2.74 149% January 1, 2016 155%
5 5 Alaska 2.74 149% January 1, 2016 145%
6 9 Delaware 2.32 126% December 1, 2015 125%
8 6 Oklahoma 2.23 121% January 1, 2016 137%
8 7 Illinois 2.23 121% January 1, 2015 127%
9 20 Rhode Island 2.20 119% August 1, 2014 107%
10 10 Louisiana 2.11 115% January 1, 2016 120%
11 11 Montana 2.10 114% July 1, 2015 119%
12 23 Wisconsin 2.06 112% October 1, 2015 104%
14 8 Vermont 2.02 110% April 1, 2015 125%
14 13 Maine 2.02 110% April 1, 2015 116%
15 17 Washington 1.97 107% January 1, 2016 108%
17 27 Hawaii 1.96 107% January 1, 2016 100%
17 12 New Hampshire 1.96 106% January 1, 2016 118%
18 17 South Carolina 1.94 105% September 1, 2015 108%
20 21 Missouri 1.92 104% January 1, 2016 107%
20 20 New Mexico 1.92 104% January 1, 2016 108%
22 20 Minnesota 1.91 104% January 1, 2016 107%
22 27 North Carolina 1.91 103% April 1, 2015 100%
23 31 Wyoming 1.87 101% January 1, 2016 95%
24 24 Iowa 1.86 101% January 1, 2016 101%
25 29 Alabama 1.85 100% March 1, 2015 97%
26 17 Pennsylvania 1.84 100% April 1, 2015 108%
27 32 Georgia 1.80 98% March 1, 2015 95%
28 14 Idaho 1.79 97% January 1, 2016 109%
29 38 Mississippi 1.70 92% March 1, 2015 85%
30 22 Tennessee 1.68 91% March 1, 2015 105%
32 30 Nebraska 1.67 91% February 1, 2015 96%
32 25 South Dakota 1.67 91% July 1, 2015 100%
33 28 Florida 1.66 90% January 1, 2016 98%
34 34 Michigan 1.57 85% January 1, 2015 91%
35 41 Colorado 1.56 84% January 1, 2016 81%
36 40 Kentucky 1.52 82% October 1, 2015 82%
38 37 Arizona 1.50 82% January 1, 2016 86%
38 35 Maryland 1.50 82% January 1, 2016 88%
40 36 Texas 1.45 79% July 1, 2015 87%
40 33 Ohio 1.45 79% July 1, 2015 94%
41 39 Kansas 1.41 77% January 1, 2016 83%
42 45 District of Columbia 1.37 74% November 1, 2015 70%
43 46 Nevada 1.31 71% March 1, 2015 68%
44 48 Massachusetts 1.29 70% April 1, 2014 63%
45 43 OREGON 1.28 69% January 1, 2016 74%
46 45 Utah 1.27 69% December 1, 2015 71%
47 48 Virginia 1.24 67% April 1, 2015 63%
48 43 West Virginia 1.22 66% November 1, 2015 74%
49 49 Arkansas 1.06 57% July 1, 2015 58%
50 50 Indiana 1.05 57% January 1, 2016 57%
51 51 North Dakota 0.89 48% July 1, 2015 47%

Notes: Starting with the 2008 study, when two or more states’ Index Rate values are the same, they are assigned the same ranking. The index rates reflect ad- justments for the characteristics of each individual state’s residual market. Rates vary by classification and insurer in each state. Actual cost to an employer can be adjusted by the employer’s experience rating, premium discount, retrospective rating, and dividends. Link to previous reports and summaries.

Employers can reduce their workers’ compensation rates through accident prevention, safety training, and by helping injured workers return to work quickly.