DWC Data Call Shows Sharp Drop In COVID-19 Claims Reported

Workers’ compensation claims for COVID-19 declined sharply beginning July 2020 according to data collected by the Texas Department of Insurance, Division of Workers’ Compensation. Reported claims peaked at 8,903 in July and dropped to 1,113 in September. Claims reported for the first week of December (through December 6, 2020) totaled 264.

Last spring the Division issued a mandatory data call for certain information related to COVID-19 injuries reported to selected insurance carriers on or after December 1, 2019. The action, which was announced in Commissioner’s Bulletin No. B-0029-20 followed the agency’s request for public comment from system stakeholders to help shape the parameters of the data call. The data was initially requested in three phases.

The Division enlarged the data call to include an additional intergovernmental risk pool and several self-insured independent school districts in January 2021. Moreover, in Commissioner’s Bulletin No. B-0003-21, DWC extended the data call through June 2021for all selected carriers by adding two additional phased responses.

The Report and Key Findings

The Division, through the Research and Evaluation Group, has published rolling results from the data call. In a recent update to the data, COVID-19 in the Texas Workers’ Compensation System, the REG reported the following key findings from the research:

Claim frequency: The sharp increase in COVID-19 occupational disease claims reported in early 2020 interrupted a 20- year trend in Texas of fewer workers’ compensation claims reported each year. Since new reportable claims are still being reported, these statistics may change over time. Total number of claims reported to DWC from January to October 2020 was about 14% higher than the same period in 2019.

COVID-19 claims: As of December 6, 2020, insurance carriers reported more than 32,000 COVID-19 claims and 130 fatalities to DWC. Most of these claims and fatalities involve first responders and correctional officers/prison workers.

Claims with positive tests or diagnoses: Nearly half (47%) of claims involved injured employees who tested positive or were diagnosed with COVID-19.

Denials and disputes: Data call results show insurance carriers accepted slightly more than half (51%) of COVID-19 positive test claims. Despite more than 5,600 denials of COVID-19 claims with positive tests or diagnoses, there were only 17 disputes filed with DWC as of December 6, 2020.

Benefits paid: For COVID-19 claims, most of the benefits paid were indemnity benefits (particularly employer salary continuation), compared to medical benefits.

Background and Conclusions

On March 13, 2020, Texas Governor Greg Abbott issued a statewide disaster declaration for COVID-19. While state and local efforts are being made to address the pandemic, there are many unknowns about its ultimate impact on the Texas population and economy, and on employees and employers covered under the state’s workers’ compensation system.

Early in the pandemic, DWC monitored the COVID-19 claims reported by insurance carriers and realized that many of these claims appeared to be  “exposure-only” claims, with no documentation of whether the injured employee had tested positive for COVID-19. Many  of these claims were being investigated and either accepted or denied by the insurance carrier, based on whether the injured employee could provide medical evidence of a positive test or diagnosis, as well as documentation showing a connection between the COVID-19 infection and work. In an effort to understand the proportion of these COVID-19 claims with a positive test or diagnosis, DWC issued a data call with 66 insurance carriers representing the State of Texas, political subdivisions, commercial insurance carriers, and certified self-insured employers.

The Division published a list of insurance carriers who are participants in the data call. These carriers include four state workers’ compensation systems, 17 Texas cities who self-insure, 12 self-insured Texas counties, 6 Texas hospital districts who self-insure, 7 intergovernmental risk pools, 2 certified self-insured employers, several self-insured independent school districts and 19 commercial insurance carriers or carrier groups.

Researchers discovered that 61 percent of the state’s COVID-19 cases were concentrated in 10 counties. Those counties are Harris, Dallas, Tarrant, Bexar, Hidalgo, Travis, El Paso, Cameron, Fort Bend, and Nueces. Similarly, about 57% of the state’s COVID-19 workers’ compensation claims were concentrated in these same 10 counties. Slightly more than half (53%) of the state’s COVID-19 workrs’ compensation claims were concentrated in these same 10 counties. Approximately half (49%) of the COVID-19 claims involved first responders and correctional officers and 59% of claims were processed by the State of Texas and its political subdivisions acting as insurance carriers.

Overall, the results of the data call (for claims reported to the insurers as of September 30, 2020), showed that 47% of the COVID-19 claims involved an injured employee who tested positive or was diagnosed with COVID-19 (Figure 6). Among these positive test claims, more than half (51%) were accepted as work-related by insurance carriers, nearly half (45%) were denied by the insurance carriers, and 4% were still under investigation. These statistics vary across types of insurance carriers. COVID-19 claims being processed by the State of Texas reported the highest rate of denials (76%); however, commercial insurance carriers had the highest number of denials.

Indemnity Benefits Paid

Using DWC’s administrative data as of December 11, 2020, insurance carriers and employers paid $21.93 million in indemnity benefits on COVID- 19 claims, $14.74 million in employer salary continuation, $7.07 million in workers’ compensation income benefits, $68,690 in death benefits, and $54,610 in burial benefits.

Most of these costs have been paid by political subdivisions (72%) followed by commercial insurance carriers (26%), and the State of Texas (3%). Injured employees receiving income benefits were paid for an average of 20 days of disability per claim (median: 16 days).

Medical Costs Paid

Using DWC’s administrative data of December 11, 2020, insurance carriers paid a total of $9.22 million in medical costs on COVID-19 claims. Most of these payments were for hosp9tal/facility services. To date most of these costs have been paid by political subdivisions (66%) followed by commercial insurance carriers (29%) and the State of Texas (5%).

Upcoming COVID-19 Data Call Submission Deadline

Submissions for the three data calls were completed August 17, 2020, October 30, 2020 and January 29, 2021. The data call extension now includes two more submissions: April 30, 2021 and July 30, 2021.

The Division has directed all selected insurance carriers and insurance carrier groups to provide summary data using the COVID-19 data call reporting forms and instructions. Each selected insurance carrier or group is required to provide one data submission per insurance carrier or group.	Deadline For Submission to DWC
COVID-19 exposures and injuries reported to the insurance carrier from December 1, 2019, through March 31, 2021, and payments made on those injuries as of March 31, 2021.	April 30, 2021
COVID-19 exposures and injuries reported to the insurance carrier from December 1, 2019, through June 30, 2021, and payments made on those injuries as of June 30, 2021.	July 30, 2021

For the fourth data call, insurance carriers and groups must submit the requested data to DWC through the insurance carrier Austin representative’s Secure File Transfer Protocol box no later than 5 p.m., Central time on April 30, 2021. If FO&L serves as your Austin Representative, please coordinate your planned data submission with our office through Heather Terrones at hta@fol.com.

Carriers’ fourth data call submission is a cumulative data submission. It should include all COVID-19 exposures and injuries reported and payments made on these injuries from December 1, 2019, through March 31, 2021, and payments made on those injuries as of March 31, 2021.

Insurance carriers should maintain injury level data for the injuries reported in this data call and may be asked to submit that data to DWC in the future.

Reminder on COVID-19 Coding

In the past, Division staff has voiced concerns that they are not seeing the reporting of as many COVID-19 claims as has been anticipated. Under Rule 120.2 (a) an employer must notify its carrier of each death or occupational disease it receives notice of, as well as any accidental injury that results in more than one day’s absence from work. The employer must do so within eight days of receipt of this notice. Carriers must then electronically file specific information from the original Employer’s First Report of Injury not later than the seventh day after receipt of such a required report where there is lost time from work or an occupational disease. Rule 124.2(c) (1) (A).

It is also important to remember that DWC issued the following coding guidance in a memo March 27, 2020. DWC expects carriers to use the International Association of Industrial Accident Boards and Commissions codes for EDI claims reports: “cause of injury” code 83 -Pandemic and “nature of injury” code 83 – COVID-19 on April, 2020. We recommend that you remind those persons within your organization who are responsible for injury coding of this obligation. If the coding has been omitted on claims reported on or after April 1, 2020, we recommend going back and amending your reporting to include the proper coding.

If you have any questions regarding this data call, please contact Bobby Stokes or James Sheffield.