posted on 2022-03-28, 23:51authored byKyu Hyung Park
Workers’ compensation is a form of insurance for employers providing income replacement, medical benefits and rehabilitation support to eligible workers suffering a work-related injury or illness. The cost of work-related injuries and illnesses is significant in Australia, amounting to 4.1 percent of GDP in terms of total economic cost. Among all injuries, psychological injury is the most expensive form of workers’ compensation claim due to its typically long duration. Despite the importance and cost of work-related psychological injury, the factors associated with prolonged claim duration are still not well understood. Using data provided by the workers’ compensation agency in South Australia, this research identifies factors associated with the duration of workers’ compensation claims for psychological injuries (psychological claims), and develops a practical and informative business model to aid the management of such claims by using modern analytics techniques including classification tree and association rule learning. We find that the factor most associated with duration of psychological claims is occupation, followed by bodily location of the most recent prior claim and age of injured worker. It is found that, among psychological claims, those made by claimants in high socio-economic occupations are at higher risk of prolonged claim duration. We finally develop a triage model that uses these factors to segment claims according to risk of prolonged duration. The model enables the focusing of efforts and resources on high-risk claims, thereby reducing the economic and societal burden of work-related injury.