Consequential Costs of Occupational Accidents from an Economic and Managerial Perspective
For occupational injuries, economy, employers, and insurance companies do not only face directly related accident costs but also long-term follow-up costs. We reveal their cost influencing factors to integrate them into current and future costs of occupational injuries that where acknowledged in a certain year. To do so, we develop a detailed decision for support system called “Cost Calculation Tool” that investigates total direct and main indirect costs of individual injury claims from the time of the incident of all injured individuals up to their death. It helps policy makers cluster patients into risk groups to optimally improve the conditions at dangerous and problematic workplaces, to target prevention strategies and to better plan for prevention budgets.
Data and Methods
The Cost Calculation Tool is based on the calculation scheme of the AUVA, which represents the largest of the four occupational insurance companies within the Austrian compulsory social insurance system. The applied methodology follows the total cost calculation concept including cost-type accounting, cost-center accounting, and cost-unit accounting to identify and forecast possible cost drivers. Full costing is preferred over marginal costing due to the inclusion of information on a comprehensive economic level. Among others, such economic factors comprise costs for loss of productivity or inflation, while employer costs such as sick leave payments are based on legal requirements. To calculate insurance costs on a gernal absis and per single casualty, we access real AUVA-data from its income statement as well as further internal data bases for the injuries related to 2010 and 2011 and complement them by essential self-developed cost estimations and approximations.
Results
We illustrate the power of our decision support system on the dataset of occupational injury cases acknowledged in the year 2010. First, we prove that the influence of single cost drivers changes over time. Overall, the AUVA has to bear 40% of the lifelong costs, followed by economic productivity losses and employers with 15.6%. Regarding the AUVA costs of the total 117.85 million Euro within the first two years after the accident, treatment costs account for about 66%, pension costs for about 12%, and co-payments for sick leave for about 10%. However, under a lifelong cost-perspective pension costs are the main cost driver with nearly 50%, while treatment costs only account for less than 15% of the overall 656.8 million Euro.
Second, another policy analysis supports the identification of accident categories to disclose high potentials for special information campaigns targeted to such risk groups. We reveal that the long-life costs for traffic accidents are nearly five times higher than non-traffic accidents with average total costs of over 49,000 Euro and a most expensive case with about 4.8 million Euro. Based on the insights of this research project, the AUVA policy makers highly focus their prevention strategies on traffic-related accidents on the way to/from/at workplace, accidents at construction sites, as well as accidents in the forestry and agriculture.
Third, we identify a high potential for the improvement of insurance-internal databases and cost structures.