Occupational Disease and Workers’ Compensation: Coverage, Costs, and Consequences

Most of the costs of occupational disease are not covered by workers’ compensation. First, the authors estimated the deaths and costs for all occupational disease in 1999, using epidemiological studies. Among the greatest contributors were job-related cancer, chronic respiratory disease, and circulatory disease. Second, the authors estimated the number of workers’ compensation cases, costs, and deaths for 1999, using data from up to 16 states representing all regions of the country. Unlike the epidemiological studies that emphasized fatal diseases, the workers’ compensation estimates emphasized nonfatal diseases and conditions like tendonitis and hernia. Comparisons of the epidemiological and workers’ compensation estimates suggest that in 1999, workers’ compensation missed roughly 46,000 to 93,000 deaths and $8 billion to $23 billion in medical costs. These deaths and costs represented substantial cost shifting from workers’ compensation systems to individual workers, their families, private medical insurance, and taxpayers (through Medicare and Medicaid). Designing policies to reduce the cost shifting and its associated inefficiency will be challenging.

Author(s): J. Paul Leigh; John A. Robbins

Keywords: economics; OSHA; employment

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Volume 82, Issue 4 (pages 689–721)
DOI: 10.1111/j.0887-378X.2004.00328.x
Published in 2004