Gone are the days of mailing the Employer's First Report of an accident to the insurer's claims office. A three or four day delay in starting the claim due to the mail service is not an acceptable claims handling practice like it was a couple of decades ago. Today, with the internet, the claims report will be in the claims office within seconds of it being sent by the employer.
With electronic reporting of claims of claims available 24 hours a day, 7 days a week, 365 days a year, the employer can submit the claim at any time. Therefore, the best time for the employer to report an injury claim or a reported occupational illness is immediately upon learning of the event. Fast, accurate reporting of the claim benefits both the employer and the employee.
When the injury occurs, the employer's first and foremost duty is obtain the appropriate medical care for the employee. It's the employer operates in a jurisdiction where the employer selects the medical provider, the employee should be directed to the nearest medical facility appropriate for the injury. If the employer is in a jurisdiction where the employee can select their own medical provider, a list of recommended medical providers should be provided to the employee to select from. When the employer shows immediate concern about the injury to the employee, a higher level of communication about the injury throughout the claim will be established.
There are several benefits to reporting the claim immediately. They include:
1. It lowers the cost of the claim – studies have shown the faster the claim is reported, the lower the overall cost of the claim.
2. A study by Firemen's Fund reported a 3-day delay in reporting a claim added an average of 16% to the medical cost and 38% to the indemnity cost, and increased attorney involvement by 50%.
3. A study by Hartford Insurance Company showed a week's delay in reporting the work comp claim increased the overall claim cost by 10%, and a month's delay in reporting the work comp claim increased the settlement cost of the claim by 48%. Furthermore, the Hartford study showed the longer the delay in reporting the claim, the higher the probability of litigation.
4. A study by the National Council on Compensation Insurance found that litigated claims cost 40% more to settle than non-litigated claims.
5. The claims office cannot accomplish anything until the claim is reported – the claims office can get started with their investigation immediately when the claim is reported immediately. (Your claim handling agreement with the insurer or the third party administrator should specify all employees will be contacted the same day the claim is reported to the claims office).
6. The employee, the supervisor and any witness memories are fresh and important details are not forgotten.
7. Witnesses to the accident are available.
8. If an inspection of the accident scene is needed, the accident scene is more likely to be unchanged than it would be later.
9. If the injury involves equipment failure or machinery failure, expert assistance can be used to establish and maintain subrogation rights.
10.The immediate reporting of the claim allows the adjuster and the nurse case manager the opportunity to take prompt cost reduction steps.
11.The employee can receive the right medical care by having the managed care provider involved in the claim from the start. Trying to change the medical treatment plan of a doctor after the doctor has been treating the employee can result in a disruption of care, confusion or even attorney involvement.
12.It shows the employee you care about the employee's well being.
13.It allows for the establishment of a modified duty return work process before the employee can contemplate how long he/she can be off work.
14.It perpetuates the employee's return to a normal lifestyle of working a regular schedule.
15.It minimizes the interruption of your business.
The immediate reporting of claims allows the adjuster to investigate and validate the compensability of all claims. It allows for immediate medical intervention while providing the appropriate medical care. The immediate reporting of claims also protects the insurers right of recovery from any responsible third party. Also, the immediate reporting of claims puts the employer and the claims office in charge of the claim, preventing a medical provider or plaintiff's attorney from usurping the direction and control of the claim.
Every department manager and every supervisor should be trained to immediately report all claims to the employer's work comp claims coordinator. If the employer does not have a work comp claims coordinator, the supervisor or manager for the employer should immediately complete the Employer's First Report of Injury and electronically submit it to the claims office. When the claim is severe, the claims coordinator or department supervisor should telephone the claims office with the information on the claim. To insure compliance with the immediate reporting requirements, the timely reporting of work related injury should be a component of the supervisor's performance evaluation and salary increase. (WCxKit)
The immediate reporting of claims will reduce the medical cost, will reduce the indemnity payments, will reduce the employees time away from work, will lower the claim administration cost and reduce the possibility of attorney involvement. The immediate reporting of claims is an essential step every employer should take to control workers' compensation cost.
Author Rebecca Shafer, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing.
Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
