Changes In OR DWC Audits Reflects 'Philosophical Shift'

Portland, OR (CompNewsNetwork) - The Workers' Compensation Division (WCD) is changing the way it conducts claims processing performance audits. The new audits will build on education and consultation intended to enhance compliance, focus on identifying industry and company problems, reward companies that perform well, and require greater accountability from poor performers to improve performance. WCD's goals are to provide clear direction and expectations for industry compliance with requirements and audits.

The new audit methodology reflects a significant philosophical shift. The division is transitioning from the “one-size-fits-all” approach where, regardless of performance, we audit companies using rigid cycles, samples, and narrowly defined findings categories. Instead, WCD will now use a risk-based approach to monitor core performance areas in a less-burdensome way, while focusing more effort on other topic-specific performance areas identified through performance data, system indicators, trends, problems, or policy decisions. This methodology will allow us to better monitor the current health of Oregon's workers' compensation system as a whole, rather than limiting our oversight to performance areas in static audit programs with long cycle times.

Starting in late 2009, WCD will shift the majority of our audit activities to the following:
Annual audits – focusing on timeliness of benefit payments and processing actions
Focused audits – emphasizing specific performance areas

A summary of the proposed annual and focused audits is available online at

The annual and focused audits will replace the quarterly claims processing performance (QCPP) audit, the compliance audit, and the Workers' Benefit Fund reimbursement audits (including the Employer-at-Injury Program audit). We are not changing our claims reserve audit of self-insured employers, as its purpose is not related to claims processing. The division anticipates stopping the quarterly penalties under the current QCPP audit, after the third quarter of 2009.

WCD would appreciate industry input on these proposed changes and the information contained in this notice. To help us improve our information and services, please complete the Audit Changes Survey online at

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