That liability — estimated payments for accidents that have already occurred — grew from $301 million in 2008 to $866 million last year, the audit said.
The top agencies for claims from 2014 to 2017 were the University System, the Department of Corrections, the Department of Behavioral Health and the Department of Juvenile Justice. The University System is the biggest employer among state agencies.
Auditors said the number of accident claims has declined, but the cost per claim has increased. The state often hasn’t allocated enough money to settle claims up front, so many of those hurt years ago continue to receive benefits.
Settling a claim is the equivalent of paying for something in cash, rather than over 20 or 30 years with interest. The one-time cost may be high, but it’s cheaper than making monthly payments.
Because of the deficit this year, the Department of Administrative Services — which bills agencies for workers’ compensation premiums — will ask lawmakers to include an extra $6 million in the midyear budget they will consider during the 2018 session, the audit said.
The midyear budget covers the final few months of the fiscal year, which ends June 30.
Senate Appropriations Chairman Jack Hill, R-Reidsville, said Thursday that he hadn't read the audit yet, but that his committee knew going into the session it would have to work to fix the system.
“I would assume there will be some attention paid to the workers’ compensation issue,” Hill said. “The long-range plan is it would be cheaper to settle (cases). I would assume we will develop a plan to settle them.”