Long-term disability costs are an anchor on the U.S. health care system. For years, employers and health insurers have borne the cost of workers who remain out of the office for extended stretches and require increasingly expensive medical costs. Based on a recent report from Aon, it looks like 2011 will provide no relief.The average claim size has increased 4%, adding to the business world's ballooning long-term care liability costs. California, Kentucky, Tennessee and West Virginia now face the highest costs. There is good news, however. While Tennessee does have the highest average claim loss rate of $2,620, it has improved; back in 2003, the average claim cost was $3,370. And Texas offers hope for all.
"Texas-style tort reform, where constitutional amendments have protected a hard cap on damages since 2003, stands in sharp contrast to both California and West Virginia," said study co-author Christian Coleianne of Aon Global Risk Consulting. "Since Texas implemented tort reform, loss rates have been among the lowest in our database."
The state had the second highest loss rate in 2003. Since then it has dropped its average claim cost to just $330. So it seems that everything isn't bigger in Texas after all -- and that's something companies should be happy about.