Workers’ compensation trends continue stability, long-term downward trajectories

Workers’ compensation claim rates and benefits paid in Minnesota continue to be stable or follow their long-term downward trajectories, a new Department of Labor and Industry (DLI) report shows.

The 2025 Minnesota Workers’ Compensation System Report presents trend data from 2003 to the present regarding several aspects of Minnesota’s workers’ compensation system. For the past four years, the report has tracked two sets of trends for the workers’ compensation system: one for the whole system, including COVID-19 claims; and another for the system excluding COVID-19 claims, which shows a pattern more similar to prior years.

Significant findings

• Relative to the number of full-time-equivalent (FTE) workers, the total number of paid claims dropped by 45%, indemnity claims by 28% and medical-only claims by 50% from 2003 to 2023. The total claim rate reached its lowest level in 2023 compared to any other reported year.

  • COVID-19: There was a 43% increase in the indemnity claim rate from 2019 to 2022, due to the influx of COVID-19 indemnity claims. However, in 2023, with the large decline in COVID-19 claims, the indemnity claim rate reverted to the rate observed before the pandemic.

• Between 2003 and 2023, indemnity benefits per $100 of payroll fell 38% and medical benefits per $100 of payroll fell 50%.

• The estimated total cost of Minnesota’s workers’ compensation system was $1.80 billion for 2023, or $0.91 per $100 of payroll, indicating a decrease of 45% over 20 years.

• In 2023, on a current-payment basis, the three largest components of total workers’ compensation system cost were medical benefits (33.5%), insurer expenses (32.7%) and indemnity benefits other than vocational rehabilitation (29.2%).

• Compared to 2003, the average amount of time an injured worker received total disability benefits was 18% longer in 2023 for non-COVID-19 claims. The average duration of temporary partial disability (TPD) fell 20% by 2023 for non-COVID-19 claims.

  • COVID-19: Total disability duration decreased 35% from 2019 to 2022 due to the significantly shorter duration of COVID-19 claims. In 2023, total disability duration was closer to pre-pandemic levels. TPD duration increased 8% from 2019 to 2023.

After adjusting for average wage growth, the following was found.

• Total disability benefits (temporary total disability benefits and permanent total disability benefits combined) per paid indemnity claim were largely stable from 2003 to 2019, but increased 12% from 2019 through 2023 for non-COVID-19 claims.

  • COVID-19: When COVID-19 claims were included, total disability benefits per paid indemnity claim fell 27% from 2019 to 2022, but increased above pre-pandemic levels in 2023.

• TPD benefits per paid indemnity claim fell 38% from 2003 to 2023 for non-COVID-19 claims.

  • COVID-19: When COVID-19 claims were included, there was a 37% decrease in TPD benefits per paid indemnity claim from 2019 to 2022, but increased to pre-pandemic levels in 2023.

• Permanent partial disability (PPD) benefits per paid indemnity claim fell 74% from 2003 to 2023 for non-COVID-19 claims.

  • COVID-19: When COVID-19 claims were included, the decrease from 2003 to 2023 was 75%. From 2019 to 2023 there was a 32% decrease in PPD benefits per paid indemnity claim.

• Participation in vocational rehabilitation rose from 21% of paid indemnity claims for injury-year 2003 to 24% for 2019, but decreased to 23% among non-COVID-19 indemnity claims for injuries in 2023.

  • The 2023 vocational rehabilitation participation rate was 22% when COVID-19 indemnity claims are included.

• The denial rate for non-COVID-19 claims with 2023 injuries was 16.6%, which is less than the 17.4% rate observed in 2022.

  • The denial rate of filed indemnity claims, with COVID-19 claims included, was 23% for 2023. This was below the rate of 30% for 2022.

• In 2024, 86% of scheduled mediations were completed, while 28% of scheduled medical conferences and 25% of scheduled rehabilitation conferences were completed.

The complete report is available online.