There are many assumptions surrounding workers' compensation. Here are a few common assumptions and associated correct facts.
Assumption: There is nothing you can do to control workers' compensation costs.
Fact: There are tried and true methods for reducing costs.
Management must have a positive attitude, developing creative ideas to bring employees back to work more rapidly. Returning employees to work as soon as they are medically able to perform any type of transitional duty job is a key to overall cost reduction.
Include your broker, insurance account executive, the third-party administrators (TPA) claims manager, and a medical advisor in brainstorming meetings. Show how much it costs to pay for one workers' compensation claim and the annual cost of workers' compensation at each company.
Assumption: The best way to reduce workers' compensation costs is to change insurance companies or TPAs.
Fact: The best way to reduce costs is to build a better relationship with your current claims administrator.
A lack of communication is a major cause of discontent between carriers and insureds. This causes a perception that something is being done improperly. For example, in one case a company believed that nurse case management was too expensive. However, an audit by a medical advisor showed that nurse case management services should be used more and be brought in earlier. It wasn't effective when it was used, thus appearing expensive and wasteful, because it was used too late in the process.
Become more informed about your claims administrator's services. Invite your TPA in with all of their services to a Vendor Day. Ask for samples of reports and deliverables to better understand their products and know when to request services. Have them give out brochures before Vendor Day so that you can ask knowledgeable questions about their services.
Visit a claims office to observe their processes. Find out if adjusters have backup and clerical support to get medical files. Observe the intake desk and the lost time and medical adjusters. Ask to see what happens to medical bills when they enter the system until the time they are paid and filed. This will give you a better understanding of how you can interact more effectively, what information adjusters need from you and what information you can provide about your workplace and employees.
Invite your adjusters to visit your workplace, so that they know what your company does and the types of jobs and skills required of employees. They cannot accurately visualize exactly how an injury occurred if they never visited your workplace.
Assumption: If you have unions, you'll never lower your workers' comp costs.
Fact: Negotiating with a union can be successful.
Begin with a positive and cooperative attitude.
The need for a transitional duty program is usually facilitated by unions. Sometimes unions have creative ideas about how a new transitional duty program can work and they will inform you of collateral source benefits. In one case, the union was angry with management because management hadn't tried to do more to stop several fraudulent claims.
Inform the union that staying out of work for long periods normally doesn't help an injured employee heal. In fact, an employee may become depressed once the employee loses a daily routine and social network.
Focus on the membership's economic consequences and interests. For example, if the majority of members are young, emphasize how the extra money helps them pay their children's college tuition. If members are older, emphasize how the savings helps their retirement accounts.
Assumption: The best thing to do to move a slow claim is to request an Independent Medical Evaluation (IME).
If a claim is “stalled,” it's common for adjusters to recommend getting an IME to get the employee's status. Before a claim is sent for an IME, have a medical advisor review the claim.
In some cases, an IME may be warranted. However, sometimes a request makes it worse, such as when the timing isn't right, when inadequate medical records are included with an IME packet or when inadequate medical questions are asked of the doctor performing the IME.
Consider a Functional Capacity Evaluation (FCE) instead or get brief surveillance to see the employee's actual capabilities.
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Disclaimer: WorkersCompensation.com publishes independently generated writings from a variety of workers' compensation industry stakeholders. The opinions expressed are solely those of the author and do not necessarily reflect those of WorkersCompensation.com.