| Abstract: | This paper seeks to evaluate the efficacy of rehabilitation programs in facilitating injured workers' return to work. A major methodological problem with such investigations is the inability of the analyst to observe the counter-factual, i.e. the outcome had the worker's compensation claimant not received rehabilitation services. In this paper the results are reported of an empirical investigation of the effectiveness of rehabilitation programs undertaken by 503 injured workers. An internal control group of injured workers who fail to complete rehabilitation programs is used to assess the impact of rehabilitation. Multivariate statistical techniques are used to hold injury and socio-economic characteristics constant, and to arrive at an estimate of the probability of a successful return to work. This probability estimate is then used to ‘weight’ the potential cost saving. Our findings are that every $1 spent on rehabilitation services yields a reduction of system costs of $2.31. |
