Why Higher Wages May Signal Greater Medical Utilization in Injured Workers

According to research from the National Council on Compensation Insurance (NCCI), medical utilization and medical severity generally increased as wages rose in the claims studied. NCCI reported that workers earning more than 150% of their state’s average weekly wage had approximately 1.6 times the medical utilization and 1.5 times the medical severity of workers earning less than 50% of the state average. NCCI also reported that this pattern was observed across age groups, industries, geographic regions, and classifications within individual industries.

“An injured worker’s wages may offer additional context regarding the potential medical demands of a workers’ compensation claim,” said Jason Wagenblast, Director, Claims at Safety National. “Considering wage information alongside an injured worker’s job field, injury type, jurisdiction, and other claim-specific factors could support more informed reserving, medical management, and return-to-work planning.”

Here, we review some of the key findings from NCCI’s Wages and Medical Utilization in Workers Compensation research brief.

Service Intensity Drives the Difference

Medical utilization measures the volume and intensity of services provided to an injured worker, including physician care, hospital services, ambulatory surgery, prescription drugs, and medical equipment. After accounting for differences in pricing for these services, NCCI’s findings suggest that higher costs among higher-wage workers in the study were associated more with intensive care patterns than with higher prices for the same services.

Higher wage workers in the study were about twice as likely to undergo major surgery compared with lower-wage workers. That difference may contribute to higher costs across several categories, including professional services, facility care, prescriptions, and medical equipment.

Fewer Claims but Greater Complexity

NCCI’s research suggests that higher-wage workers in the claims studied may have been less likely to report lower-cost injuries compared with lower-wage workers. Among workers earning less than 50% of the state average weekly wage, NCCI reported that 54% of claims involved $5,000 or less in incurred indemnity. That figure dropped to 27% among workers earning more than 150% of the state average.

Several factors could potentially contribute to delayed or limited reporting, although individual circumstances will vary. Higher-wage employees may have concerns about whether indemnity benefits will cover living expenses, the professional impact of an extended absence, or the effect of time away from work on their responsibilities. In some cases, delayed treatment can complicate claim handling or medical management.

What This Means for Workers’ Compensation Programs

Wage data should not be viewed as a standalone predictor of claim outcomes, but it can provide useful context when evaluating claim exposure. Employers, brokers, third-party administrators (TPAs), and carriers may benefit from reinforcing prompt injury reporting across all employee groups and identifying potential barriers that could discourage workers from seeking care. Early reporting and intervention may help connect injured workers with appropriate treatment before conditions become more complex.