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The Workers’ Compensation Insurance Rating Bureau of California has released its COVID-19 in California Workers’ Compensation – 2022 Update. This report details the characteristics of COVID-19 workers’ compensation claims in California and their impact on the state’s workers’ comp system.

As the economy has reopened and following the Omicron surge, COVID-19 claims continue to be a modest share of all indemnity claims.The winter surge from the Omicron variant peaked in January 2022 with almost 40% of reported indemnity claims from COVID-19. Beginning in February, COVID-19 claims dropped significantly but in recent months COVID-19 claims have been about 5% of reported indemnity claims.

Throughout the pandemic, the Health Care sector has had by far the highest proportion of indemnity claims involving COVID-19. Public administration, which includes some first responders, also had a high proportion of COVID-19 claims. Manufacturing had the second highest share of COVID-19 claims until late 2021. With the economy growing at the end of 2021 and into 2022, more COVID-19 claims were reported in the Accommodation & Food Services and Retail sectors than in Manufacturing.

More than one-half of COVID-19 claims were incurred by workers aged between 16-39, which is somewhat higher than the proportion of all indemnity claims incurred by younger workers. Almost 80% of COVID-19 death claims were incurred by workers aged 50 years or older compared to about one-third of all indemnity claims.

Far fewer COVID-19 claims are classified as medical-only claims than non-COVID-19 claims. More than 40% of COVID-19claims are indemnity claims with no medical losses incurred compared to less than 1% of non-COVID-19 claims. Most indemnity-only COVID-19 claims are relatively small and close quickly.

The vast majority of AY 2020 COVID-19 indemnity-only claims are small but there are a few large claims, mostly arising from fatalities, which are driving open COVID-19 indemnity-only claims to be costlier than non-COVID-19 claims.

Almost all AY 2021 indemnity-only claims have an incurred valueless than $5,000. A typical AY 2021 non-COVID-19 indemnity claim has incurred costs between $10,000 and $50,000 while a typical COVID-19 indemnity/medical claim has incurred costs less than $5,000. The share of COVID-19 claims over $500,000 is almost 5 times as high as for non-COVID-19indemnity claims.

Denial rates on COVID-19 claims have been higher than on non-COVID-19 claims as on average only about 8% of non-COVID-19claims are denied. Many COVID-19 claims are denied due to the lack of a positive test result for a COVID-19 infection. Generally, denial rates have been higher during the period Senate Bill No. 1159 has been in effect with its less expansive presumption of compensability than during the period the Governor’s Executive Order was in effect early in the pandemic.

For AY 2021 COVID-19 claims with indemnity and medical benefits typically have a shorter TD duration than do non-COVID-19 indemnity claims. Almost 90% of closed indemnity-only claims have a TD duration less than 2 weeks compared to 65% of AY 2020 claims at the same age.

Virtually all COVID-19 indemnity-only claims close quickly as they typically involve only short durations of TD with nearly all claims closed by 18 months. COVID-19 claims with both indemnity and medical on average close more quickly than non-COVID indemnity claims as more have relatively small incurred values.

Both indemnity and medical COVID-19 incurred losses have developed less since year-end 2021 than incurred losses on non-COVID-19 claims. This lower incurred loss development of COVID-19 claims has occurred because many COVID-19 claims close quickly and with only indemnity payments.