Workers' Compensation: NJ Workers' Compensation Cost Trends

The New Jersey Compensation Rating and Inspection Bureau (NJ CRIB) has released its 2024 annual report, offering a crucial look into the trends shaping the state's workers' compensation landscape. Understanding these trends is paramount for businesses operating in New Jersey, as it helps manage costs and ensure compliance. This analysis delves into the report's key findings, focusing on the cost of medical treatment relative to indemnity payments and overall claim trends.

A significant aspect of the NJ CRIB report is the ongoing evolution of claim costs. The data reveals a persistent upward trend in medical and indemnity payments. However, the ratio between these two categories offers valuable insight.

INDEMNITY CLAIMS

Historically, indemnity payments (covering lost wages and permanent disability) constituted more of the overall claim cost. The 2024 report indicates a continued shift, with medical costs comprising an increasingly significant share. This trend is influenced by several factors, including advancements in medical technology, increased utilization of healthcare services, and the rising cost of pharmaceuticals.

While indemnity costs have also increased, the growth rate in medical costs is outpacing them. This suggests a need for stakeholders to focus on strategies aimed at controlling medical expenses within the workers' compensation system. These strategies include promoting evidence-based medical guidelines, using preferred provider organizations (PPOs), and implementing effective utilization review programs.

CLAIM FREQUENCY

In recent years, claim frequency in New Jersey's workers' compensation system has generally shown a downward trend. However, the 2024 report likely contains updated figures that could indicate a stabilization or even a slight uptick, depending on economic conditions and industry-specific factors. Employers must analyze industry-specific data within the report to understand their potential risk exposure.

Key Takeaways from the Report:

Medical costs represent a growing proportion of total workers' compensation claim costs compared to indemnity payments.
Both average medical and indemnity costs per claim continue to trend upward.
Overall claim frequency trends warrant careful examination within the 2024 report, potentially showing stabilization or slight increases.
Understanding the evolving ratio of medical to indemnity costs is crucial for effective cost management strategies.
Businesses should analyze industry-specific data within the report to better assess their risk and potential cost drivers.

NJ Compensation Rating and Inspection Bureau Annual Reports

Recommended Citation: Gelman, Jon, NJ Workers' Compensation Cost Trends, www.gelmans.com (05/24/2025) https://workers-compensation.blogspot.com/2025/05/nj-workers-compensation-cost-trends.html

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*Jon L. Gelman of Wayne, NJ, is the author of NJ Workers' Compensation Law (West-Thomson-Reuters) and co-author of the national treatise Modern Workers' Compensation Law (West-Thomson-Reuters). For over five decades, the Law Offices of Jon Gelman 1.973.696.7900
jon@gelmans.com has represented injured workers and their families who have suffered occupational illnesses and diseases.