The Patient is on the Critical List After years of declining premiums, escalating losses, and increasing expenses, the Workers Compensation Industry is being forced to face some grim realities.
Medical costs continue to escalate at an accelerated rate.
One of the major culprits is increased prescription drug costs. These expenses have doubled since 1996 and are expected to double again by 2005. Loss reserves are understated by billions of dollars. Investment income is falling. Underwriting losses in 1999 and 2000 represented two of the three largest deficits ever recorded.