|
Once upon a time, there existed a world
wrought with overwhelmed claims handlers
unable to properly contain the costs of
workers comp.
Yet, rather than admit their failings,
legendary tales evolved foretelling how no
mere mortal could conquer the mighty beast.
Thus, the tangled odyssey began.
Today, however, we know these tales to be
myths. But still, the impossibility of workers
compensation cost containment remains heralded
by many.
Here, we slay the dragon.
MYTH: There is nothing you can do to control
workers compensation costs. It is a necessary
cost of doing business.
REALITY: Management has heard this for decades
and is rarely aware of all the steps that can
be taken to reduce workers compensation costs.
But there are tried and true methods to reduce
costs such as returning employees to work as
soon as they are medically able to perform any
type of transitional duty job.
Management must begin with a “can do” attitude
and develop creative ideas to bring employees
back to work more rapidly. Include your
broker, insurance account executive, TPA
claims manager and medical advisor in a
brainstorming and planning meeting. Have flip
charts around the room for notes, and have the
facilitator prepare thought-provoking
questions in advance, such as, “What is your
post-injury process?” or “What steps occur
immediately after an employee is injured?”
MYTH: High workers compensation costs are
caused by aggressive plaintiff’s attorneys and
laws that favor employees.
REALITY: While it is true to a limited extent
that both aggressive plaintiffs’ lawyers and
claimant-skewed laws can prolong an employee’s
time out of work and force claim costs
skyward, the largest factors driving the cost
of a claim are things that companies can
control. Inaction, lack of planning and poor
communication with the employee, adjuster and
medical providers are major gaps that drive
the cost of workers compensation higher. Poor
workplace morale and failure to take advantage
of existing opportunities represent other gaps
in company processes. These gaps cost
companies millions of dollars each year, but
tools are readily available to prevent them.
If you operate in a state where employees are
allowed to go to the physician of their
choice, for example, you can encourage them to
consult a physician who is an advocate of
transitional duty. Many will use the suggested
doctor. If the employee’s doctor has visited
your operation to see the jobs the employees
perform, it can be helpful to build a solid
relationship between the company and the
treating doctor. There are many things within
its control that a company can do to reduce
its costs.
MYTH: Cost containment programs are a “quick
fix” to the high costs of workers
compensation.
REALITY: An effective workers compensation
cost containment program is a systematic and
thorough approach to cost reduction—not a
quick fix. It focuses on multiple areas that
are all tied together with an effective
communication strategy. The design and
development of a workers compensation cost
containment program can be done within a few
months if there are dedicated resources making
this a priority.
High workers compensation costs frequently
involve lack of communication, lack of
adequate personnel, lack of resources, and
other gaps within a company, which can all be
corrected once the problems are identified.
The companies that have high workers
compensation costs are those that have too
many claims lasting too long.
The bottom line is that the length of time an
employee is out of work is often
disproportionate to the severity of the
injury. To bring the length of time an
employee is out of work back in line, a
company must have a comprehensive
return-to-work program with 90% of injured
employees returning to work within the first
few days of an injury.
To do this, you will need a company policy
mandating all employees’ participation in the
return to work program as a condition of
employment. You will need to make sure the
doctor provides work restrictions during the
first medical appointment and you will need to
assign a transitional duty job as soon as you
receive the workplace job restrictions. While
this may sound like a cumbersome task, with
the appropriate tools and the right approach,
these steps can be put in place very quickly,
often within a few weeks.
MYTH: The best way to reduce workers
compensation costs is to switch insurance
companies or third party administrators.
REALITY: More often than not, the best way to
reduce workers compensation costs is to build
a better relationship with your current claims
administrator. The major cause of discontent
between carriers and insureds is lack of
communication, which causes a perception that
something is being done improperly. For
example, in several situations a company
believed nurse case management was too
expensive. Upon audit by a medical advisor,
however, it was determined that the nurse case
management service should be used more, but it
just needed to be brought in earlier. It was
not effective when it was used—and thus seemed
expensive and wasteful—because it was used too
late in the process.
Start to build a better relationship by
becoming more informed about the services your
claims administrator offers. Hold a “vendor
day,” and invite your TPA in with every
service they offer. Ask for samples of reports
and deliverables so you can understand the
product and will know when to request
services. Have them bring brochures prior to
the event so you can read them and ask
knowledgeable questions about the services.
Visit one or two claims offices and observe
the process. Learn the categories of desks at
your carrier. For example, are there four
levels of adjusters or five? Do adjusters have
backup and clerical support to get medical
files or provide other support assistance? Sit
at the intake desk, and then join the
lost-time and medical adjusters for a few
minutes at their desks. 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.
Then invite your adjusters to visit your
workplace so they know what your company does,
the types of jobs and skills required of the
employees. They can then better visualize
exactly how an injury occurred much more so
than if they had never been to your facility.
Next month
will feature the next 5 myths. |
