All of This Because Somebody Got Hurt at Work

Hummer limos, go-go dancers, a live alligator and glowing aliens in spandex at the national workers’ comp and disability expo. Journey into the little-known workers’ comp industrial complex.

LAS VEGAS — A scantily clad acrobat dangles from the ceiling, performing flips and splits as machines puff smoke and neon lights bathe the dance floor in turquoise and magenta. Dancers in lingerie gyrate on poles to the booming techno. Actors dressed as aliens pose for selfies with partygoers. There’s an open bar and waiters weave through the crowd passing out chocolate truffles.

It’s the closing night of the National Workers’ Compensation and Disability Conference & Expo. 

The party at Light, a Cirque du Soleil-themed club at the Mandalay Bay Resort and Casino, capped off the workers’ comp industry’s biggest annual networking event. For three days in November, hundreds of vendors wooed insurers and employers with lavish after-hours parties, giveaways of designer handbags, photos with Olympic gymnast Kerri Strug, and free rides in orange Hummer limousines.

A top manager for a major insurance company recalled standing amid the hoopla a few years back when a company CEO turned to her and marveled: “All of this because somebody got hurt at work.”

Workers’ comp is supposed to be simple. If you’re injured on the job, your employer pays your medical bills and part of your wages while you recover.

But over the past two decades, a cottage industry of middlemen has emerged, which some have dubbed the “workers’ comp industrial complex.” Even private equity firms have bought in, seeing profit opportunities in employers’ and insurers’ quest to contain spending.

The middlemen offer an array of services, from managing claims to negotiating medical bills, all promising to reduce costs — although critics say some actually raise them, as well as the burden on those hurt on the job.

It’s a world largely unknown to the injured workers that the firms ultimately serve, and often to the employers who spent an estimated $89 billion on workers’ comp in 2013.

Over the past year, ProPublica and NPR have detailed how state after state has reduced the benefits historically granted to injured workers. As a result, some workers have beenevicted from their homes, denied medical care and put in humiliating situations.

While lawmakers have clamped down on payments to workers, doctors and lawyers, little scrutiny has been given to these “cost containment” firms — even though today they arguably have more influence on how injury benefits are handled than insurers and employers.

Highlighting the bounty, there are now more than 150 workers’ comp conferences a year. There’s one for the American Society of Workers Comp Professionals, one for the Association of Workers’ Compensation Professionals and one for the Association of Workers’ Compensation Claims Professionals. At least 26 have golf tournaments.

At the national workers’ comp and disability expo, vendors gave away Apple watches, bottles of bourbon, and a Vespa scooter. There were free massages and shoeshines, a superhero caricature artist, more than one mentalist, and a live alligator named Spike.