UNDERSTANDING CUMULATIVE TRAUMA CLAIMS AND THE GROWING THREAT TO EMPLOYERS
Nick Langer, Senior Risk Advisor with Turner Surety & Insurance Brokerage, Inc.
The impact of cumulative trauma (CT) claims on employer’s Workers’ Compensation insurance is astounding. While Cumulative Trauma claims are most prevalent in the manufacturing sector, the increased activity seen in the security industry demands attention.
What is a Cumulative Trauma? A cumulative trauma disorder, also known as CTD or CT, is defined as the excessive wear and tear on tendons, muscles and sensitive nerve tissue caused by continuous use over an extended period of time. CTDs can develop from improper work positioning, repetition or force. Cumulative trauma disorders (CTDs) are also known as repetitive strain injuries, repetitive motion disorders (RMDs), overuse syndrome and work-related musculoskeletal disorders. CTDs are injuries of the musculoskeletal system, which includes joints, muscles, tendons, ligaments, nerves, and blood vessels. CTD’s can include mental trauma as well.
What are the Risk Factors Contributing to Cumulative Trauma Injuries?
- Work Position
- Awkward postures/Static postures
- Force/Forceful exertions
- Repetition/Repetitive motions
- Lifting methods
- Lack of sufficient recovery time
- Mental stress
The Statistics – as published in independent reports from the Workers’ Compensation Insurance Rating Bureau (WCIRB) & the California Workers’ Compensation Institute (CWCI)
- 3% of all claims are now CT claims. This has been steadily increasing since 2008. Most of these increases are coming from the Los Angeles Area. (WCIRB)
- 80% of statewide CT claims involved attorney representation. (WCIRB)
- 61% involve multiple body parts (WCIRB)
- 39% of CT claims are being filed post-termination (WCIRB)
- Physical or mental injuries that arise over time from repetitive stress or repetitive motion exposures cost 53% more than claims that stem from a specific event or accident (CWCI)
- CT claims have doubled over the past 10 years (CWCI)
- 91% of the cumulative trauma, lost-time claims involved an attorney, which was twice the attorney involvement rate for all other claims. (CWCI)
- Medical-only cases for cumulative trauma, attorney involvement occurred in 80% of claims, four times that for injuries involving a specific event. (CWCI)
- The Los Angeles Basin accounts for more than 56% of all CT claims (WCIRB)
- Los Angeles residents accounted for 38% of all CT claims (WCIRB)
Defining Injuries: Cumulative vs. Specific
California Labor Code 3208.1 defines
- A “specific” injury as an injury occurring as the result of one incident or exposure which causes disability or need for medical treatment.
- A “cumulative” injury as an occurring as repetitive mentally or physically traumatic activities extending over a period of time, the combined effect of which causes any disability or need for medical treatment.
Identifying the “Date of Injury”
Labor Code 5412 specifies that the date of injury in cases of occupational diseases or cumulative injuries is “that date upon which the employee first suffered disability therefrom and either knew, or in the exercise of reasonable diligence should have known, that such disability was caused by his present or prior employment.”
Since there is no specific “date of injury” with a CT claim, late reporting leads to many inconsistencies in the claims process.
Disability is defined as a physical or mental impairment that limits your life activities. A condition that makes engaging in physical, social and work activities difficult.
Courts have ruled:
- T. Thorp 49 CCC 224 (1984) “… there is a date of injury” only at such time as the employee suffers an impairment of earnings capacity.”
- Flour Construction 50 CCC 532 (1985) “…disability means compensable loss of time from work due to the injury, and not a general impairment of earning power.”
- DeFelice 51 CCC 265 (1986) “… for purposes of determining the date of injury under labor Code section 5412, the term “disability” means lost time from work or compensable disability.”
Broad definitions of disability established through case law often leads to lengthy and costly disputes of CT claims.
Knowledge of the Disability
CT claims are different from specific injuries (non-CT) due to the timeframes within which an employee may claim an injury. Due to the cumulative nature of a CT injury there is no specific date of injury. As discussed previously, the CT injury date instead is assigned a claim Under California Labor Code 5412 as “that date upon which the employee first suffered disability therefrom AND either knew, or in the exercise of reasonable diligence should have known, that such disability was caused by his present or prior employment.”
Johnson 50 CCC 53 (1985) established that “an employee clearly may be held to be aware that his or her disability was caused by the employment when so advised by a physician. Generally, until he receives such medical advice, he is not chargeable with knowledge of his condition and its relation to his work…”
Basically an employee is not expected to know they have an injury, until a doctor tells them they have an injury.
Cumulative Trauma Analysis
There is growing surge of CT claims in California with the highest concentration of claims arising in the Los Angeles Basin. Contributing to this frequency are two primary issues. First, California has a very low standard in proving CT claims only requiring a 1% industrial or work-related causation and a simple “preponderance of evidence” standard of proof. Second, reporting requirements for these claims is allowing delayed reporting of claims to an employer and in many cases, claims being fired post-termination. According to the report published by the CWCI, cumulative trauma claims are being filed nearly 10 times later than non-CT claims. Instead of the claimant having to prove that an injury is work-related as with a specific injury, an employer has the burden of proving that the CT injury wasn’t caused or contributed to in the course of employment. According to the WCIRB, over 30% of CT claims are being filed post-termination. 37.3% of CT claims are disputed leading to costly litigation expenses. According to the WCIRB expenses for CT claims have 43% higher medical payments, 58% higher indemnity payments, 119% higher expenses and 53% higher total costs than non- CT claims.
Beyond increased claims cost, the contributing factors allowing CT claims to exacerbate in California have created a prime environment for fraud & abuse. It is critical for employers to educate themselves in the claims process and invest in preventative procedures and strategies which minimize their company’s exposure to these type of claims. Self-Insured employers have the benefit of dictating more of the claims process with claims administrators. For most employers in the Security Industry, whom obtain guaranteed cost workers’ compensation insurance, it is imperative to remain involved in the claims process, partner with a broker that can advocate on your behalf and fully explore the claims handling practices of prospective insurers.
Nick Langer is a Senior Risk Advisor at TSIB with more than 15 years of property & casualty broker experience. He specializes in the Construction, Energy and Security Industries. Nick enjoys the challenge of finding solutions to his client’s unique needs and is committed to learning the intricacies of each client’s business operations.
Prior to joining TSIB Nick had his own insurance agency that specialized in both personal and commercial lines of insurance. After 7 successful years of growing his property and casualty agency he joined Tolman & Wiker Insurance Services, LLC.
Nick regularly presents at trade associations on risk management topics including: Workers’ Compensation, Claims Management, Risk Management, Contractual Risk Transfer and Employment Practices Liability.
Nick is committed to improving the lives and success of his clients for the benefit of the community through his various roles and leadership positions. He has served as the Insurance Advisor to the Board of Directors of The California Association of Licensed Security Agencies, Guards and Associates (CALSAGA). He is President of The Bakersfield Young Professionals in Energy (YPE), a member of the Associated Builders & Contractors (ABC), and the former Government Affairs Committee Chair for the Central California chapter. Nick is a member of the Associated General Contractors (AGC) and the American Society of Safety Engineers (ASSE).
Nick has Bachelor of Science in Business Economics from University of California, Santa Barbara. Nick and his wife have three children and three rescue dogs. In his spare time, Nick is an avid fisherman and enjoys golfing, hiking and fitness training.