Ten times as many NSW police officers retire on medical grounds than their Victorian colleagues, gaining access to benefits costing taxpayers over $115 million this year.
The findings, in a report by the Auditor General, follow a review of the way the NSW Police manage injured workers.
Medical grounds are the most common reason for leaving the police force - ahead of resignation or retirement - and psychological injury is the third most common injury, the report has found.
The auditor General, Peter Achterstraat, has recommended an immediate review of the police force's Death and Disability scheme (which covers officers who joined after April 1999).
Since its inception in 2005, the number of officers leaving on medical grounds and making claims under the scheme has tripled.
The police should conduct an immediate review of the scheme and either reduce its benefits, increase officers' contributions or abolish the scheme, Mr Achterstraat recommended.
"The people of NSW are losing out because they are losing experienced, highly trained police officers who take a great deal of time to replace. The financial cost is one thing but more importantly, it's not always the best outcome for the police officer and the community," he said.
It was important to rehabilitate officers and get them back to work as soon as possible.
But, he said, the police forces's approach to managing officers since 2006 was appropriate, and workers compensation premiums for the current financial year had fallen.
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