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The Commission on Health and Safety and Workers’ Compensation (CHSWC) examines the health and safety and workers’ compensation systems in California and makes recommendations to improve their operation. Annual Reports are prepared by CHSWC covering the performance of the California workers’ compensation system, including discussion of reforms, recent legislation, current research and data from various sources.

CHSWC just released its 294 page 2021 Report. Some of the highlights of the new report include statistics on the estimated effects on the COVID-19 pandemic on worker safety, the effects of legislation to reduce adverse effects, and the associated cost projections on the worker’s compensation system.

According to the current report, the California WC system covers an estimated 17,385,000 employees working for over 1,039,079 employers in the state. These employees and employers generated a gross domestic product of $3.01 trillion in 2020. A total of 645,409 occupational injuries and illnesses were reported for 2020,ranging from minor medical treatment cases to catastrophic injuries and deaths. The total paid cost to employers for workers’ compensation in 2020 was an estimated $18.7 billion.

The COVID-19 pandemic presents unique conditions, in which many jobs that had not been typically considered hazardous suddenly became dangerous, and the mandatory rules of claim denials were changed by the State of California. Workers at a high risk of exposure to the virus while at work received WC insurance coverage due to efforts by Governor Newsom and his administration that started as Executive Order N-62-20 and culminated in SB 1159 on September 17, 2020.

For the dates of injury from late 2019 to June 1, 2021, about 150,000 COVID-19 claims had been filed in the California WC system. Over one-half of these COVID-19 claims were filed within the insured system.

Almost half (49 percent) of all COVID-19 claims in the first year of the pandemic in 2020 were filed by women. This share was 10 percentage points higher than the average share (39-40 percent) of women in claims for all non-fatal work injuries in California. Women make up a large share of the labor force on the front lines of the pandemic and in industries and occupations that have taken particularly large hits during the COVID-19 crisis. In 2021, 44 percent of COVID-19 WC claims were filed by women and 55 percent by men. During the peak of the Omicron pandemic in January 2022, 47 percent of COVID-19 claims were filed by women and 53 percent by men.

From March 2020 to January 2022, Los Angeles (27 percent) and the Inland Empire (24 percent) regions together accounted for 51 percent of California’s COVID-19 WC claims, followed by the Bay Area (15 percent), the Central Valley (13 percent), San Diego (7 percent), and the more rural Central Coast (5 percent) and the Sacramento Valley (5 percent). The Eastern Sierra Foothills, North State- Shasta, and the North Sacramento Valley regions, comprised of several counties with a small number of claims, together accounted for 4 percent of the COVID-19 WC claims filed during the same period.

Currently the projected costs of COVID-19 claims in the insured sector for accident years 2020 and 2021 are over $1 billion in total, with over $850 million in 2020 and $210 million in 2021, when estimated using the actual claim counts and reported cost information. The estimated systemwide cost of the COVID-19 claims in 2020 is $1.25 billion.

The projected average cost of a COVID-19 claim differs significantly by the severity of the illness, increasing from $3,000 for the mild symptom cases to $382,000 for the death claims. The average cost of all COVID-19 claims based on reported information was $19,000 which is below the initial projections of $34,000 due to a higher proportion of mild claims being filed than initially projected. Also a much higher than projected share of COVID-19 claims were filed by younger workers who are more likely to have mild COVID-19 symptoms.

Potential losses are associated with aggravation of preexisting conditions and the possibility that a claimant could become a “long-hauler” (one who continues to suffer the effects of COVID-19 long after a typical recovery course). Up to an estimated 10 percent of COVID-19 cases will experience prolonged symptoms occurring across all levels of disease severity – from mild cases to those requiring hospitalization and intensive care. Management of procedures and treatments related to long-haul COVID-19 cases are considered serious medical cost drivers.

The federal National Institutes of Health launched an initiative to study the causes, means of prevention, and treatment of long-haul COVID-19 cases.