Measuring RTW Outcomes in Workers’ Compensation: Part 3 – RTW Trajectories

 

In earlier posts, we looked at return-to-work (RTW) measures at national or multi-jurisdictional levels as well as specific RTW measures published by individual jurisdictions.

For any cohort of accepted workers’ compensation claims, the current RTW status will vary with time.  Snapshots of RTW status at increasing time from date of injury or disablement depict RTW trajectories useful in evaluating system performance and gauging the impact of legislative, policy, and practice changes over time.

This part focuses on RTW trajectories, the progression over time toward eventual RTW status. While most workers do return to work, the process may not be a simple progression from total temporary wage-loss benefits to fully restored health and earnings. RTW  trials, partial RTW stretches, repeated claim reopening for surgeries or further treatment and other combinations may extend the timeframe to eventual return to work (or permanent disability without RTW). 

AWCBC:  National Trajectory

In Part 1, I presented AWCBC data for Key Statistical Measure (KSM)25.5 – Percentage of claims off wage loss benefits (temporary disability payments) at 180 days.  AWCBC has additional measures for 30, 60, 90, 120, and 360 days. 

Data are reported by each jurisdiction for each year.  It is important to note each KSM has its own definition, and each is an independent snapshot with its own numerator and denominator.  While there is overlap, the collected results for any given year contain claims with injuries that may traverse several years.  In Part 1, I posted the full definition for KSM 25.5.  Readers should refer to AWCBC definitions for each measure for a more complete explanation [see AWCBC, KSM Definitions at https://awcbc.org/data-and-statistics/key-statistical-measures/ksm-definitions ].

Additional measures reported under AWCBC’s “Return To Work” heading note the percentage of claims still on wage-loss benefits after 2 years (KSM 24.1) and 6 years (KSM 24.2).  Each of these measures reflects data reported to AWCBC by its member jurisdictions (the workers’ compensation boards of Canadian provinces and territories).  As noted in Part 1, these measures are not based on RTW outcomes, but AWCBC describes the intent of the measure this way:

“To be a proxy of return to work. To measure how soon injured workers leave the wage-loss compensation system permanently.”

National data for Canada reported for 2022 shows:

• 68.3% off wage-loss benefits at 30 days. 
• 81% off wage-loss benefits at 90 days
• 88.21% off wage-loss benefits by 180 days (as discussed in Part 1)
• 93.46% were off wage-loss benefits at 360 days.   

AWCBC measures also note 4% of claims are still on active wage-loss benefits at after 2 years (KSM 24.1-2022) and 2.33% after 6 years (KSM 24.2-2022.  This demonstrates the “long tail” of claims costs associated with workers’ compensation injuries. 

AWCBC: Jurisdictional Trajectories    

In Canada, the US and Australia, workers’ compensation is primarily the concern of individual states/provinces/territories.  The context of each jurisdiction accounts for differences in the observed trajectories.

Looking more closely at a sampling of jurisdictions, we can see significant difference in jurisdictional coverage, compensation rates, industrial size and mix, and policy that may affect these KSMs.

Ontario is Canada’s largest province.  It has the largest concentration of very large enterprises particularly in manufacturing, but has one of the lowest level of workforce coverage by WSIB at about 72%. Compensation rates for wage loss benefits were 85% of net earnings (essentially spendable earnings).  There are no waiting periods in Ontario. 

BC is Canada’s third largest province with primary industries a dominant factor in the economy.  WorkSafeBC, the sole provider of workers’ compensation coverage, covers 95% of the employed labour force.  The compensation rate is 90% of net earnings with no waiting period. 

Nova Scotia is one of the Canada’s smallest provinces. Employers tend to be smaller than in Ontario and BC.  About 75% of the labour force is covered by the Workers’ Compensation Board of Nova Scotia.  The Temporary Earnings Replacement Benefit (TERB) rate is 75% of net earnings loss for up to 26 weeks then TERB increases to 85% of net earnings loss.  

Nova Scotia is the only remaining Canadian jurisdiction with a waiting period. Equal to two-fifths (2/5s or 40%) of a normal work week’s wages, this is essentially a worker deductible.  If the duration of the claim extends beyond five weeks (a retroactive period), the waiting period deducted for the first week is paid to the worker.

As you examine the “off wage-loss benefits” data in the table below, keep these features of each province in mind.

 

[Data from AWCBC custom report for 2022]	Ontario	British Columbia	Nova Scotia
24.1-Claims on Wage-Loss Benefits after 2 years (%)	3.15	2.64	9.80
24.2-Claims on Wage-Loss Benefits after 6 years (%)	2.04	1.12	5.59
25.1-Percentage of Wage-Loss Claims off Wage-Loss Benefits at 30 days (%)	76.52	58.00	46.40
25.2-Percentage of Wage-Loss Claims off Compensation at 60 days (%)	83.40	68.00	60.92
25.3-Percentage of Wage-Loss Claims off Wage-Loss Benefits at 90 days (%)	87.24	75.00	69.11
25.4-Percentage of Wage-Loss Claims off Wage-Loss Benefits at 120 days (%)	89.59	80.00	74.70
25.5-Percentage of Wage-Loss Claims off Wage-Loss Benefits at 180 days (%)	92.11	85.00	80.74
25.6-Percentage of Wage-Loss Claims off Wage-Loss Benefits at 360 days (%)	95.33	92.00	88.17

Texas:  Detailed RTW Findings

In Part 2, I highlighted the Texas Department of Insurance, Division of Workers’ Compensation research study, 2023 Return to Work. 

As noted, this study relies on extensive records and differentiates between initial and sustained RTW outcomes.  Using tens of thousands of cases, the study has statistical significance in finer categories than the AWCBC data. 

Recall the following definitions:

• Initial RTW is the percentage of injured employees who returned to work for the first time after their injury
• Sustained RTW is the percentage of injured employees who returned to work and stay ed at work for three consecutive quarters (nine months) after their injury.

In Part 2, the Texas initial and sustained RTW rates at six months were examined.  The following tables highlight RTW rates at various milestones post injury.  These are partial extracts from the study showing 2014-2017 injury years. As noted, this is a retrospective study so time must have passed to measure outcomes at various milestones.  Also, the definition for sustained RTW requires additional passage of time from the last injury date in the cohort to determine sustainability over three calendar quarters. 

	Table 1.1 Initial RTW % [extract]
	2014	2015	2016	2017
6 months	79	79	80	83
1 year	88	88	89	91
1.5 years	91	92	92	94
2 years	93	93	95	95
3 years	95	96	96	96
	Table 2.1 Sustained RTW % [extract]
	2014	2015	2016	2017
6 months	63	63	65	73
1 year	70	70	71	77
1.5 years	73	72	73	79
2 years	74	73	78	79
3 years	75	77	78	79

Note the relative stability of the results over time.  Note also the 10-15 percent fall-off between the initial and sustained outcomes. Again, this is based on earnings continuing for three calendar quarters after the initial RTW, so a portion of the fall off may be unrelated to the work injury.

The study contains additional detail on the RTW trajectories including initial and sustained RTW rates by industry.  Texas is one of the few jurisdictions where workers’ compensation insurance coverage is not mandatory.  That said, three-quarters of private sector employers participate covering about 83% of the labour force.  Mining, construction and utilities have the highest rates of coverage; about a third of small employer (1-4 employees) do not participate [2022 estimates].

The initial and sustained RTW outcomes vary by sector as you might expect.  The size of the dataset allows for sectoral estimates as follows:

Table 1.3 and 2.3 [extract for 2020]	Initial RTW%	Sustained RTW%
Agriculture	81	67
Arts/Accommodation	78	63
Education/Health	88	74
Manufacturing	83	67
Mining/Utilities/Construction	76	60
Other Services	80	67
Professional Group	79	63
Public Administration	90	77
Wholesale/Retail/Transportation	84	68

Note the significant difference between initial and sustained RTW outcomes.  The table also provides insight into how the industrial “mix” of a jurisdiction can influence summary statistics concerning RTW.  All other things being equal, an economy more heavily weighted toward mining/utilities/construction will have lower RTW outcomes than one dominated by public administration/education/health.

ReturnToWork South Australia: Trajectories

Outcomes for RTWSA were touched on in Part 2.  Their Statistics 2024 document contains RTW outcomes for specific milestones.  Recall the three RTW status outcomes noted: “Not at work”, “Partially at work”, and “Fully at work”. The trajectory of claims is marked by the following percentages at specific milestones:

RTWSA FY2024 – Worker Status by Week Milestone
Milestone (Weeks)	At Work	Partially at Work	Not at Work
4 weeks	70.20%	4.50%	25.30%
13 weeks	81.70%	4.40%	13.90%
26 weeks	90.70%	3.70%	5.60%
52 weeks	94.50%	1.90%	3.60%
78 weeks	96.50%	1.00%	2.50%

 Note the combination of “At work” and “Partially at work”.  These data may suggest positive impacts of stay-at-work programs. 

Note also the residual cases not back at work beyond 52 to 78 weeks or longer. It is important to remember the injured workers and their families represented by this number and to not assume a return to work is imminent.  As noted in the AWCBC and Texas data, RTW outcomes may not be achieved in 26 weeks, a year or even three years… or ever.  At some point, however, the case will close.  Although “closure” is not an outcome, understanding the trajectories of these claims is important.

In personal injury and disability management, much of the attention is paid to headline, recent claims data.  In reality, much of the work of workers’ compensation entities is focused on longer duration claims. 

The RTWSA report demonstrates this by reporting active accepted claims by claim duration.  This snapshot shows the significant proportion of claims

Active Accepted Claims – FY 2024 Breakdown

Claim Duration	Percentage (FY 2024)
0 to 1 Years	40.1%
1 to 2 Years	15.9%
2 to 3 Years	8.6%
3 to 4 Years	5.9%
4 to 5 Years	4.5%
5 to 6 Years	3.7%
6 to 7 Years	2.5%
7 to 8 Years	1.8%
8 to 9 Years	1.8%
9 to 10 Years	1.2%
> 10 Years	14.1%
Grand Total	100 %

WorkSafe Victoria: Physical vs. Mental Injury Trajectories

The mix of injury categories, like the mix of injuries, can have a significant impact on RTW outcome measures.  Few jurisdictions report RTW outcome results by injury category.

As noted in Part 2, WorkSafe Victoria does report and target its RTW measures for two injury categories.  I’ve extracted the headline key performance indicators for both physical and mental injuries for financial year 2022/2023 from their 2023-2024 Corporate Plan:

WorkSafe Victoria Return to Work Rates F/Y 2022/23
	Physical Injuries	Mental Injuries
16 wks	67.40%	32.90%
26 wks	73.60%	41.60%
52 wks	78.80%	49.90%
104 wks	81.00%	58.70%

Note the significant difference in the trajectories of these two injury categories.  This illustrates one of the complexities with this type of injury.  The disability management approach applied to physical injuries requires adjustments to meet the needs of this population. The performance expectations metrics applied by workers’ compensation authorities to claims administration agents must be responsive to the differences.

As with industry mix, the mix of injury categories can influence RTW outcomes reported at the jurisdictional level. Since both can change over time, public reporting and access to underlying data are essential to oversight and transparency. 

Summary comments on RTW Trajectories and Final Thoughts

The users of RTW data are many.  Politicians and policy makers need these data to monitor performance and decide if and how programs ought to change. 

Stakeholders need RTW data for similar reasons and to help them evaluate how current the current system is meeting their needs. Administrators need RTW data to assign resources, assess performance, and monitor success against intended targets.

For actuaries and planners, RTW trajectory information can help model claim costs and determine sufficiency of assets to cover the claim, administration, and medical costs over the life of the claims entering the system each year, 

In Part 1, standardized methodologies across jurisdictions allowed for interjurisdictional comparison. Comparative data (with context for each comparator) allows reported performance data to be fairly interpreted. 

Part 2 demonstrated the insights application of consistent measures of RTW over time for individual jurisdictions. Examining if and how RTW outcomes change over time provides a starting point for evaluating scheme effectiveness on a primary objective of workers’ compensation systems.

RTW trajectories, as shown in Part 3, illustrates how quickly the full (and in some cases partial) RTW outcome results level off after the initial 30, 60 or 90 days in the AWCBC data examples.  The Texas and ReturnToWork SA results show minimal (if any) gains in either initial or sustained RTW outcomes after 1-1.5yrs post initial disablement.  The WorkSafe Victoria data demonstrate the stark difference in RTW outcomes between physical and mental injury cases.

Knowing the current pattern and distribution of RTW outcomes over months or years is essential to system oversight, policy design, and program evaluation. The RTWSA underscores the service and support needs of those cases with less than a full or sustained RTW or ongoing disability.

Few workers’ compensation jurisdictions post RTW outcomes.  Fewer still report on the durability or RTW outcomes with sufficient detail to allow for critical review, analysis and comparison. Measuring RTW outcomes –full, partial, successful or not—is fundamental.  Transparency around RTW outcomes is essential.

If RTW outcomes are truly a priority for workers’ compensation, then reporting on this metric should be routine, data-rich, and transparent at all levels—from program and service providers, to disability management agents and claims administrators to full systems at the state/provincial and national level.

“Measurement is the first step that leads to control and eventually to improvement.

If you can’t measure something, you can’t understand it.

If you can’t understand it, you can’t control it.

If you can’t control it, you can’t improve it.”

― H. James Harrington [attributed]

Thanks to those who prepare, research,  and report their data and make it available to others.   And special thanks to those who answered questions regarding their data. 

[This post was prepared as a resource for DMCCT- Evaluating DM Programs & Assessing RTW Processes, Pacific Coast University for Workplace Health Sciences.]