September 16, 2025
The workers’ compensation landscape continues to evolve, shaped by demographic shifts, mental health challenges, legal developments and healthcare access concerns. At the 2025 National Council of Self-Insurers (NCSI) conference, I spoke with a panel of experts including attorneys and workers’ comp professionals to explore four pressing issues that are influencing how injuries are prevented, managed and resolved. Their insights offer a roadmap for employers, risk managers and claims professionals to stay ahead of emerging trends with data-driven and employee-centered strategies.
1. The aging workforce: rising claims and new approaches
One of the most significant changes in today’s workforce is the growing number of older employees. Sedgwick data shows that in 2024, the largest year-over-year increase in workers’ compensation claims came from employees aged 60 and older, with a 2.8% rise over 2023. This group also had the highest number of temporary total disability (TTD) days — nine days above the average — and a 35% increase in average medical service costs.
These trends align with broader demographic projections. The U.S. Bureau of Labor Statistics anticipates a 22.4% increase in workers aged 65 to 74 and a 79% increase in those aged 75 and older by 2033. It is increasingly important for employers to thoughtfully adapt their safety and training programs to meet the needs of this aging workforce. As I noted while on the panel, employers must meet employees where they are. This means tailored training methods like one-on-one instruction, virtual reality simulations and using assistive technologies to reduce physical strain.
Legal considerations are also an important part of the equation. Older workers may have more complex claims involving Medicare Set-Asides (MSAs), retirement-related benefits and litigation risks. Employers should take a proactive and informed approach through their administrator to ensure appropriate resources are engaged at the right time, prioritizing medical and disability management to ensure the best outcomes possible.
2. Mental health: expanding coverage and early intervention
Mental health continues to be one of the most pressing and complex concerns in workers’ compensation. Although only 2% of claims currently involve a mental health component, these claims cost 3.5 times more and last 3.6 times longer than those without. Therefore, early intervention is key. Sedgwick data shows that engaging behavioral health specialists within the first 90 days of a claim can reduce TTD days by 40% compared to treatment initiated between 90 and 180 days, and by 70% compared to treatment after 180 days.
Employers are increasingly promoting Employee Assistance Programs (EAPs) and virtual mental health services to support their workforce. Clear, consistent communications, as well as regular reminders and outreach, helps ensure employees are engaged and aware or their resources. Mental health challenges often begin in the non-occupational setting and transition into the workplace, so addressing these issues early can prevent more serious complications down the line.
Legal trends are also shifting. Several states are expanding workers’ compensation coverage for mental health conditions, particularly for first responders. Broader inclusion for all employees is on the horizon, and employers must be prepared to navigate these changes.
3. Exclusive remedy: legal challenges and risk implications
The principle of workers’ compensation as an exclusive remedy is facing increased scrutiny. Recent court cases in California, Kentucky, Mississippi and Nebraska have tested the boundaries of this legal protection. While no state has overturned the exclusivity provision, there is growing momentum to challenge it.
Social inflation and nuclear verdicts are driving this trend. Injured employees and their attorneys are seeking ways to bypass workers’ compensation and pursue civil litigation, where potential payouts are significantly higher. Employers must be vigilant in reviewing their insurance coverage and legal policies to ensure they are protected.
The legal environment outside of workers’ compensation is more open and unpredictable, which creates a risk environment where even well-established protections may be tested. Employers should work closely with legal counsel to monitor developments and prepare for potential challenges.
4. Medical treatment access: workforce shortages and system resilience
Access to medical care remains a critical issue in workers’ compensation. The Association of American Medical Colleges projects a shortage of up to 86,000 physicians by 2036, driven by retirements, increased demand and limited growth in residency programs. While the number of registered nurses has grown, the supply of licensed practical nurses and nurse midwives has declined, particularly in rural and underserved areas.
Despite these challenges, Sedgwick data shows that treatment timelines have not yet been impacted. Lag intervals between injury and care remain consistent with historical trends. However, ongoing monitoring is essential to ensure this remains the case.
To address potential shortages, regulators are expanding the definition of providers to include physical therapists, nurse practitioners and other qualified professionals, as well as adjusting fee schedules to attract providers to the workers’ compensation system. Employers play a vital role in supporting these efforts by optimizing their provider networks and planning for jurisdictional differences in access to care.
Conclusion
The workers’ compensation landscape in 2025 is marked by demographic shifts, evolving mental health needs, legal challenges and healthcare access concerns. As highlighted in the NCSI panel discussion, proactive strategies are essential to navigate these changes effectively.
To navigate this evolving landscape, employers, risk managers and claims professionals should embrace data-driven approaches, prioritize employee well-being and stay informed about legal and regulatory developments. By doing so, they can build resilient programs that support injured workers, manage costs and ensure compliance in an increasingly complex environment.
