The Return on Investment for Workplace Rehabilitation Position Paper

Like most other services, workplace rehabilitation should be subject to a rigorous cost benefit analysis and as the saying goes, if you don’t measure it, it doesn’t get done! ARPA believes that workplace rehabilitation is an invaluable service that when used correctly and promptly can yield a significant return on investment, for workers, employers and the broader Australian economy.

Up until now no Australian workers’ compensation regulator has published independent research on the
return on investment (ROI) of providing workplace rehabilitation services. However, recently the NSW State Insurance Regulatory Authority (SIRA) commissioned Ernst & Young to undertake a comprehensive research study to investigate the impact of receiving WRP services on RTW rates for claimants on weekly benefit. The high-level results show that:

  • for claims between 6 months and 24 months time lost, the appointment of a WRP improves the RTW outcome
  • the timely appointment of a WRP (within the first 8 weeks) can improve RTW rates by 3% to 5%
  • appointing a WRP early in the claims process can result in total claims costs savings of between 4% and 9%.

With claims costs for NSW approximately $3.7 billion per year, if the appointment of a WRP occurs early in the claims process this could lead to a $330 million saving for the NSW workers’ compensation scheme.

Extrapolated across all Australian workers’ compensation schemes, the increased use of workplace rehabilitation earlier in the claims process could equate to an $800 million annual saving for Australian employers.

The evidence clearly shows that the engagement of a WRP has a demonstrated strong ROI.

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