Liability costs rising 4% annually for long-term care

Share this article:
Gov. Mark Parkinson
Gov. Mark Parkinson

Long-term care's medical liability costs have been growing 4% annually, according to a new analysis.

Aon Global Risk Consulting analyzed approximately 19,500 claims from 37 long-term care providers and found that claim severity and loss rates have grown 4% each year since 2009. The frequency of the claims has stayed stable over the past four years, however. The American Health Care Association and National Center for Assisted Living sponsored the study.

Liability costs have risen from just more than $1,000 per bed in 2005 to what is expected to be $1,540 per bed by 2013, analysts say. Claim severity, meanwhile, is projected to reach $175,000 per claim by 2013.

“This analysis shows costs exploding in states without meaningful, effective medical liability reform,” AHCA President and CEO Mark Parkinson said in a statement.

Provider chain Extendicare announced it was leaving Kentucky last month because of what it called a negative litigation environment for long-term care providers. The Aon report subsequently found that Kentucky “has the highest loss rate in this study at $5,350 per bed while Texas has the lowest at $330 per bed.”

Report authors also observed, “Arbitration continues to be an effective cost limiting tool.” Out of 1,449 closed claims, those settled under valid agreements were 21% less costly.

The report can be downloaded here.

Share this article:

More in News

Antipsychotics reduction goal raised to 30% by end of 2016, CMS and provider groups announce

Antipsychotics reduction goal raised to 30% by end ...

Long-term care providers are being asked to reduce the use of antipsychotic medications among residents by 25% by the end of 2015, and 30% by the end of 2016. Providers ...

CDC issues new guidelines on pneumococcal vaccine, says LTC flu vaccination rates remain low

CDC issues new guidelines on pneumococcal vaccine, says ...

Long-term care workers continued to have low rates of flu vaccination last season, despite there being 92% vaccination coverage overall among physicians and nurses, the Centers for Disease Control and ...

AL operators accused of withholding $2M in unpaid overtime, minimum wages ...

Four California assisted living operators are facing eight felony charges related to wage theft, tax and insurance violations, according to local reports.