One of the keys to achieving a profitable business is protecting the business from unnecessary operating costs. An easy way to eliminate unnecessary expense is through the risk management technique of a loss prevention program. A loss prevention program reduces the cost of workers' compensation insurance and eliminates much of the unseen cost of workers’ comp injuries.
In addition to the medical benefits and indemnity benefits paid to injured employees, there are substantial other unseen cost incurred by the employer, not the workers’ comp insurer, related to any workers’ comp claim including:
1. The time loss from work activities by the injured employee, other employees, and supervisors.
2. The time spent hiring and training new employees to replace the injured employee.
3. The drop in product or service quality by the new hires in comparison to the quality produced by the experienced employee.
4. The time spent completing paperwork on the injury, the time spent processing or forwarding medical bills to the insurer and the time spent on record keeping
5. The time spent working with the adjuster, the medical provider, the nurse case manager, and the employee in getting the employee back to work.
6. The time spent attending hearings and/or conferences.
7. The loss of goodwill with customers and/or the loss of customers.
A loss prevention program assists your company in mitigating the cost of both the workers’ compensation insurance and the unseen cost associated with every injury. The framework of your loss prevention program should include at a minimum:
- A corporate policy
- Safety training
- Work site inspections
Corporate Policy
Your company needs an established loss prevention program; one that includes a published safety policy. Make all employees aware of the safety policy and the requirement their active participation in the safety program is expected. A good way to accomplish employee participation is to provide the safety policy as a part of the new hire orientation, one requiring new employees to read and sign a copy of the safety policy.
Safety goals must be realistic and clearly stated. Establish a system of measuring performance against the goals publish the results where they can be clearly seen by all employees. One example of a measurable goal used by many companies is: “the number of days without a lost time injury.”
Safety Training
Training employees to act and work in a safe manner, is one of the best ways to prevent accidents from happening. When the employees know ahead of time certain actions may result in their being injured, they will act in a safe way to protect themselves. By teaching the employees to recognize hazards you build loss prevention into their every day work activities.
Teach your employees to recognize these risks or hazards avoid:
1. The bypassing or making inoperative safety devices or machinery guards.
2. The improper use of tools and equipment.
3. The using of equipment the employee has not been trained to use.
4. The failure to use protective gear and protective clothing.
5. The improper storing of supplies or materials.
6. The failure to use proper lifting techniques.
7. The use of defective tools or equipment.
8. The use of equipment with inadequate lighting.
9. The failure to keep floors clean and dry.
10. The improper use of electrical wiring or outlets.
When a new hire or an experienced employee starts a work assignment where they many lack experience, the supervisor needs to carefully explain not only the task to be done, but also the hazards associated with the task and how to prevent an injury from occurring. Once the employee starts the task or new assignment, the supervisor needs to observe and have the employee explain each step of the work process and repeat back to the supervisor what the hazards are and how to avoid them.
The safety training needs to include scheduled loss prevention talks by the supervisor or manager. These can be informal talks covering the risk associated with a change in productions methods, the cause of a recent accident, or why a particular hazard is of concern. The supervisor or manager solicits feedback from the employees at the loss prevention talks to ensure their understanding and compliance with the safety program.
Work Site Inspections
In addition to a corporate program and safety training, it is essential for your company has a work site inspection program. Based on your own work accident history, look for the conditions causing injuries in the past. By recognizing the causes of past injuries, you can take steps now to prevent the same type of injuries from occurring in the future.
Create an inspection checklist to use you in recognizing and eliminating hazards such as poor housekeeping, congested areas, unsafe acts, and unsafe conditions. Based on the results of your inspection, you can take action to correct deficiencies noted and to prevent the deficiencies from occurring again. (workersxzcompxzkit)
Summary
A properly created loss prevention program significantly reduces the cost of workers' compensation and reduces other unseen costs to the employer. If you need assistance with your loss prevention program, please contact us. We have extensive training materials and guides designed to assist you in creating a loss prevention program or improving your current loss prevention program.
Author Rebecca Shafer, Consultant/Attorney, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
Broadspire, a Crawford Company and leading third party administrator of workers’ compensation claims, liability claims and medical management services, has introduced the BOLD network, a custom preferred provider organization (PPO) strategy that includes targeted selection of medical networks on a state-by-state basis to produce superior outcomes for clients.
“For decades, traditional PPO network solutions have been a steadfast component of the workers’ compensation industry. But while preferred provider discounts still help reduce claim costs, they do not completely address today’s complex challenges,” said Danielle Lisenbey, chief operating officer, medical management services. “Our new state-stratified, multi-tiered approach allows us to partner with the best network by region, industry and sometimes even by company.”
The BOLD – Broadspire’s Original Landmark Design – network features:
- Regional networks – Broadspire works to find the best network in each state or region. Regional networks typically have better relationships with local providers, which often translate into more favorable rates.
- Specialty networks – Broadspire also contracts with special networks that concentrate on workers’ compensation needs such as durable medical equipment (DME) and physical therapy.
“Instead of casting a wide net in hopes of a good outcome, this level of customization can produce superior penetration rates and savings when compared to the rest of the industry,” Lisenbey said.
Included among Broadspire’s networks and partners are: Aetna, Align Networks, Black Diamond, Express Scripts, Healthcare Solutions, HFN, MedFocus, MTI, Next Imaging, Rockport, Signature Networks, Three Rivers, Total Medical Solutions, Universal Smart Comp and United Health. Broadspire’s PPO website, www.BroadspirePPO.com, features the ability to search for providers and networks by state.
In addition, through the use of objective metrics, Broadspire is able to identify needs and cost drivers to build network solutions that are unique and specific to clients. Some examples of cost-saving solutions include:
- A DME formulary with integrated clinical protocols
- Physical therapy protocols and utilization review guidelines
- Diagnostic imaging & retrospective guidelines
- Clinical home health guidelines and vendor integration
- Coding methodology for medical and non-medical transportation.
“The key to our documented success is working with the right strategic partners and applying proprietary clinical intervention triggers to make the greatest difference in reducing claim costs,” Lisenbey said. “We measure our success by our ability to improve our clients’ bottom line, and our medical network strategy continues to evolve to meet the ever-changing demands of managing workers’ compensation costs.” (workersxzcompxzkit)
About Broadspire: Broadspire, a leading international third party administrator for large self-insured organizations, offers a broad array of customized claim and medical management services designed to increase employee productivity and contain costs. Broadspire's U.S. offering of workers’ compensation, auto and general liability claims administration, medical management and absence and care management, is available bundled or individually. In addition, Crawford provides liability, motor and property claims management services in Europe under the Broadspire brand. Broadspire is based in Atlanta, Ga., with a network of 85 locations throughout the United States (www.choosebroadspire.com) and Europe (www.Broadspire.eu), including the United Kingdom (www.broadspiretpa.co.uk).
About Crawford: Based in Atlanta, Ga., Crawford & Company www.crawfordandcompany.com) is the world's largest independent provider of claims management solutions to the risk management and insurance industry as well as self-insured entities, with a global network of more than 700 locations in 63 countries. The Crawford System of Claims SolutionsSM offers comprehensive, integrated claims services, business process outsourcing and consulting services for major product lines including property and casualty claims management, workers’ compensation claims and medical management, and legal settlement administration. The Company’s shares are traded on the NYSE under the symbols CRDA and CRDB.
Contact: Stephanie Zercher at 404.300.1908; stephanie_zercher@us.crawco.com
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
Five states, Louisiana, Mississippi, Alabama, Arkansas, and Tennessee, are targeted by the
United States Immigration and Customs Enforcement (ICE) for a workforce inspection.
One hundred and eighty employers received notices that ICE plans to inspect hiring records to determine whether they are complying with employment eligibility verification laws and regulations. The inspections are part of ICE's increased focus on holding employers accountable for their hiring practices and efforts to ensure a legal workforce.
Employers are required to complete and retain Form I-9 for each hired individual for work in the United States. Employers must review and record the individual's identity document(s) and determine whether the document(s) reasonably appear to be genuine and related to the individual.(workersxzcompxzkit)
In 2009, ICE implemented a new, comprehensive strategy to reduce the demand for illegal employment and protect employment opportunities for the nation's workforce. Under this strategy, ICE is focusing its resources on the auditing and investigation of employers suspected of cultivating illegal workplaces by knowingly employing illegal workers.
Author Rebecca Shafer, J.D. Consultant, has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
The lesson employers can take away from this tale:
1. Ride herd (that's Texan for "actively monitor") on pending work comp claims.
2. Settle work comp claims sooner than later.
3. Communicate effectively with injured employees to circumvent lawsuits.
In 1999 the famous "Octo-Mom, a psychiatric technician at a California state hospital, filed a workers’ compensation claim. Eleven years later, the California Division of Workers’ Compensation (CDWC) settled the long-running lawsuit arising from the claim.
The claim, originally for $40,000, was decreased by $6,000 in legal fees and $10,880 in previously awarded advance payments, for a total settlement of $23,120.
"This should settle all issues of permanent disability and future medical needs" for the worker, according to Susan Gard, chief of legislation and policy at CDWC.
One item open to further litigation is a lien from the woman’s medical providers against the State Compensation Insurance Fund, Gard said. (workersxzcompxzkit)
Three groups, Southern California Mental Health Associates, Southern California Mental Health Pasadena, and AD-RX pharmacy, report they are owed money for the "octo-mom's" treatment. The mental health providers say they're still owed $800, collectively. The pharmacy claims it is owed an undetermined sum.
Author Rebecca Shafer, Consultant/Attorney, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
Broadspire, a Crawford Company and leading third party administrator (TPA) and medical management services provider, has launched a new Alternative Dispute Resolution (ADR) process for unions, the first such program offered by a national TPA to the $10.6 billion unionized workers’ compensation market.
“In the current economic climate, all of us should get excited about a solution where everybody wins,” said Broadspire Senior Vice President Kerwin Williams. “With ADR, employers benefit directly from tremendous cost savings, injured employees receive elevated assistance and heightened care delivery, while unions reap the rewards associated with improved relationships with management.”
Passed in 1993, California Senate Bill 983 enabled employers and unions in the construction and other closely related industries to design and implement alternatives to statutory workers’ compensation. Roughly 10 years after the passage of SB 983, Senate Bill 228 expanded the legislation to cover all California unionized industries. Thirty-three other states have followed California’s lead and now have specific or enabling ADR language.
Broadspire, working in conjunction with Workers’ Compensation Solutions LLC (WCS), a leading ADR consulting firm, leverages key legislation and employs nurse advocates to assist an injured worker through a structured claims management process. This systematic methodology has been proven to help expedite medical care, reduce the amount of time an injured employee is off work and drastically diminish formal litigation. “Through partnering with WCS, Broadspire is able to bring to market a program with an exceptional track record for reducing medical and litigation costs,” Williams says.
As the third-largest third party administrator and fourth-largest medical management provider in the country, Broadspire provides an effective ADR solution in all 33 states where legislative guidelines permit. The Broadspire/WCS solution can be implemented with fully insured, loss-sensitive, self-insured or Taft-Hartley Trust programs.
Collectively bargained workers’ compensation, also commonly referred to as union ADR or carve outs, provides enhanced medical delivery, significant cost savings and improved management/labor relations. Independent studies, one conducted by Cornell University and the other by the California Workers’ compensation Institute (CWCI), have found that ADR programs result in:
· A 26% reduction in average length of claims
· A 58% savings in average cost of claims
· A 36% reduction in litigation rates.
“In my 42 years of experience in public safety labor I’ve never observed a labor/management Alternative Dispute Resolution program that will help the American worker and the business community like the ADR concept developed by Broadspire and Workers’ compensation Solutions,” said Don Novey, executive director, California Peace Officers Memorial Foundation. “This full-service ADR non-adversarial advocacy program is vital for jobs, economic growth and protecting the American workforce.” (workersxzcompxzkit)
About Broadspire: Broadspire, a leading international third party administrator for large self-insured organizations, offers a broad array of customized claim and medical management services designed to increase employee productivity and contain costs. Broadspire's U.S. offering of workers’ compensation, auto and general liability claims administration, medical management and absence and care management, is available bundled or individually. In addition, Crawford provides liability, motor and property claims management services in Europe under the Broadspire brand. Broadspire is based in Atlanta, Ga., with a network of 85 locations throughout the United States (www.choosebroadspire.com) and Europe (www.Broadspire.eu), including the United Kingdom (www.BroadspireTPA.co.uk).
About Workers’ compensation Solutions LLC: As pioneers in the ADR arena, the management team of WCS has collectively developed an unparalleled expertise and possesses significant relationships within the organized labor setting – both private and public.
About Crawford: Based in Atlanta, Georgia, Crawford & Company ( www.crawfordandcompany.com ) is the world's largest independent provider of claims management solutions to the risk management and insurance industry as well as self-insured entities, with a global network of more than 700 locations in 63 countries. The Crawford System of Claims Solutions SM offers comprehensive, integrated claims services, business process outsourcing and consulting services for major product lines including property and casualty claims management, workers’ compensation claims and medical management, and legal settlement administration. The Company’s shares are traded on the NYSE under the symbols CRDA and CRDB.
Contact: Stephanie Zercher at 404.300.1908, stephanie_zercher@us.crawco.com
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
The U.S. Bureau of Labor Statistics (BLS) recently issued a new report in its Program Perspectives series examining paid sick leave benefits, including both the percentage of employees with access to paid sick leave and the associated employer costs.
According to the report, the length of service had minimal impact on paid sick leave provisions, but several other worker and company characteristics did affect the provisions.
Additionally, BLS’ report reveals that worker characteristics contributed to the differing employer costs associated with providing paid sick leave benefits.
The data contained in the report are from the National Compensation Surveys on Employee Benefits in the United States and Employer Costs for Employee Compensation.
Highlights of the report include:
1. Private industry workers access to paid sick leave benefits varied by occupational group and ranged from 84% for management, professional, and related occupations to 42 percent for service workers.
2. Eighty-one percent of employees earning wages in the highest 25 percent of the wage distribution had access to paid sick leave, compared with only 33 percent for employees in the lowest 25 percent.
3. In private industry, employees received an average of 8 days of paid sick leave after 1 year of service, with large establishments providing an average of 11 days and small establishments offering an average of 6 days.
4. The cost for sick leave per employee hour worked in State and local government was 81 cents compared to 23 cents in private industry.
5. Higher paying occupations typically incur higher sick leave costs. For example, the average employer cost for sick leave benefits in management, professional, and related occupations was 53 cents per employee hour worked in private industry; the cost for service occupations was just 8 cents per employee hour worked.
Author Rebecca Shafer, Consultant/Attorney, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
As in any natural disaster, the personnel responsible for after care are vulnerable to various workplace safety hazards and occupational diseases and/or injury. “Hazwoper” is the acronym the Occupational Safety and Health Administration (OSHA) for Hazardous Waste Operations and Emergency Response. In the case of the oil spill, these are the men and women wearing the white/yellow) hazard suits cleaning up the beaches and marshes.
Employers can expect workers’ comp claims to be filed at the state and federal level in Louisiana, Mississippi, Alabama, and Florida and under the Jones Act and the Longshore and Harbor Workers' Compensation Act.
As an employer, if you are in any way involved with the containment or the cleanup of the oil spill, it is strongly recommended you review your workers’ comp coverage with your broker to verify you have coverage you need for both state and federal workers’ comp exposure.
According to OSHA website, 15 to 20 OSHA Compliance Officers are in the field everyday monitoring worker safety and health at all 17 staging areas and many other work sites.
OSHA Purpose is:
1. collect information on employers, workers, and the work performed
2. conduct interventions
3. evaluate operations for potential hazards
4. evaluate the personal protective equipment being used
5. evaluate the training being provided to the workers
6. document and address any concerns that are identified
7. monitor worker exposure and the health effects from the exposure to oil, weathered oil,
oil dispersants, cleaning agents and other materials.
OSHA's primary concern is the health of the ““hazwopers”” who are being exposed to various chemicals known to cause health problems. The chemicals can have ill effects in very low amounts of exposure – parts per million (ppm) concentration in the air. The primary chemicals OSHA is concerned about are:
1. Volatile Organic Compounds: carbon based organic compounds found in the air as gases or vapors.
2. Hydrogen Sulfide: a toxic gas often found in crude oil.
3. Carbon Monoxide: a toxic gas associated with fuel combustion.
4. Petroleum Hydrocarbons: used to describe several hundred chemical compounds originating from crude oil
5. Benzene (including toluene, ethyl benzene, and xylene): a colorless and highly flammable liquid found in crude oil and a known human carcinogen.
OSHA is monitoring the ““hazwopers”” for various adverse health effects including irritation to the eyes, skin and respiratory system; headaches; tremors; confusion; unconsciousness; rapid heart rate; nausea; weakness; dizziness; and injuries to the nervous system.
In addition to the chemical exposures faced by the ““hazwopers””, they are at risk for other workers’ comp injuries and illnesses, of which the most likely injury or illness the threat of heat exhaustion and heat stroke. Even a white suit gets very hot on the inside when the outside temperature is 90 degrees or above, a common occurrence in the summertime on the gulf coast beaches. Pictures are on the internet of “hazwopers” with the top half of their suits un-done and hanging from the waist. The workers are apparently more concerned about heat stroke then about chemical exposure. (workersxzcompxzkit)
Other potential hazards possibly creating a workers’ comp claim include:
1. Repetitive strain injuries from the use of equipment and constant bending over to clean up the oil.
2. Sunburn.
3. Noise from the operation of equipment.
4. Slips, trips and falls.
5. Fatigue.
6. Biological – plants, insects, animals.
7. Unguarded equipment.
8. Vehicles.
9. Drowning.
Besides the “hazwopers” being at risk for injury, various other workers and volunteers trying to contain the oil spill and clean up the beaches are also at risk. The potential for workers’ comp claims grows as the oil spill grows.
Author Rebecca Shafer, Attorney/Consultant, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
With the extended downturn in the economy, most workers' compensation insurance companies find themselves with a combined loss ratio in excess of 100, which means they are losing money. When insurance companies start losing money, they start raising their premium rates. In response to rising insurance cost, many employers are considering self-insurance for their workers’ comp coverage.
The financial considerations for self-insurance include lower insurance cost, lower claim adjusting cost, better claim management, and lower state assessments. Other considerations include better integration of safety programs, better employee relations, and better management control.
Lower Insurance Cost
The lower cost of insurance is the initial reason most employers consider self-insuring. When an employer purchases insurance from an insurance company, the amount paid for the insurance premium includes:
1. The cost of claims.
2. The cost of administering those claims.
3. The operating expenses of the insurance company.
4. The insurance company's profit.
By self-insuring employers eliminate the insurance company's profit and the insurance company operating expenses (but assumes additional operating expenses of their own).
The employer is able to self-insure because the amount of workers’ comp losses are predictable based on experience. By knowing the amount of predictable losses, the employer self-insures for those amounts and purchases an excess insurance policy only for the losses deviating above the norm. Thus, the self-insurer purchases less insurance than would be purchased through a full-coverage workers’ comp insurance policy.
Lower Claim Adjusting Cost
While the Fortune 500 companies operate their self-insurance programs in many states, most self-insured operate in one state or a few states. Smaller operations allow them to use the services of the smaller third party administrators (TPA) able to provide excellent claim services at prices below what national and international TPAs must charge. The smaller local or regional claim administrators are more flexible in crafting and pricing the claims administration program to the needs of the self-insured employer.
Better Claim Management
When the insurance company adjuster is handling an employer's workers’ comp claims, the adjuster tend to want to do things his/her own way. While an employer may make recommendations and suggestions to the adjuster, in the end the adjuster follows the instructions of the claim office supervisor, not the employer’s wishes. When the TPA's adjuster is handling the workers’ comp claim, the self-insurer/employer the boss. The recommendations, suggestions, and directions provided by the employer will be closely followed by the TPA adjuster.
Assessments and Taxes
The cost of state assessments and taxes are included in the insurance policy from the workers’ comp insurer. The insurance carrier pays required assessments not levied on self-insurers. These include: the state assigned risk pool, the second injury fund, and insurance guarantee fund. When these assessments are levied on the self-insured they are lower because the insurance company assessment is based on premiums while the self-insured pays the assessment base on claim payments.
However, assessments do not always go in the favor of the self-insured company. Some states require self-insured companies to pay into a state self-insurance insolvency fund to cover claims from self-insurers who are insolvent.
Safety Programs
Companies switching to self-insurance almost always improve their safety programs to reduce or eliminate as many workers’ comp claims as possible. The employer who properly manages the loss prevention program will find the cost savings from workers’ comp self-insurance to be substantial.
Integration between the self-insurance program and the loss prevention program is much more complete within the employers who self-insure. When the insurance company is paying the claims, the motivation to prevent injuries is there but is not felt strongly. There is a greater motivation to get the most out of the loss prevention program when your company is paying the claims.
Employee Relations
A side benefit to the self-insuring employer is the ability to build better employee relations when an employee is injured. Employees often find comfort in the fact that their employer is in contact with them and it will be their employer making the decisions on their workers’ comp claim rather than an adjuster of an insurance company.
Management Control
Self-insurance often blends into the management philosophy of many employers who feel more comfortable being in control of the cost of the corporation. The self-insurance program allows the employer to participate actively in the claim management process and the associated cost of the claims. (workersxzcompxzkit)
Summary
Self-insurance allows the employer to reduce the cost of the workers’ comp insurance program. The self-insurer benefits from lower insurance premium/loss cost, lower claim handling cost, has better claims management, and lower assessment and taxes. The self-insurer also benefits from a more integrated safety program, better employee relations, and stronger management control. For more information on self-insurance programs, please contact us.
Author Rebecca Shafer, Attorney/Consultant, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
A very easy cost driver to fix is employee communication. Think of it this way: someone is communicating with your employees. They get messages from newspapers, television, billboards, and placards. OR from a frequently played daytime ad for an injury attorney, encouraging them to sue.
It’s just not true talking about the ins and outs of workers’ comp encourages employees to file claims. In fact, the employer’s workers’ comp costs are lower the more a company communicates with their injured employees.
Communication is part of an employer’s multi-level strategy of communication with everyone –employees, doctors, TPA, and broker. It may include video messages from the president, sample weekly meeting guidelines for workers’ comp coordinators to use, and forms for injured employees to complete.
In a workers’ comp program, you will “get” and “give” information. Think in terms of what information you need to “give” and what do you need to “get.”
A get-well card is an example of giving a message in an informal way. In the card you could include a $20 gift card for pizza. Such a gesture communicates to your injured worker your awareness that the whole family is suffering with the mom/dad out of work, and getting a pizza is a nice thing to do for the whole family. It sends a clear message that the employer cares about the family.
Author Rebecca Shafer, J.D., President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.
FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
WC Calculator: http://www.reduceyourworkerscomp.com/calculator.php
TD Calculator: http://www.reduceyourworkerscomp.com/transitional-duty-cost-calculator.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com
A former San Francisco Unified School District employee was arrested on suspicion of fraudulently distributing public money, according to the California Department of Insurance.
The woman allegedly issued $85,000 of public money to an injured school district employee in permanent disability advances, knowing she was overpaying the injured worker by more than $76,000, the insurance department said. The injured worker was found to be entitled only to $9,320 in permanent disability advances.
Insurance investigators started their investigation into the case when Tristar Risk Management, a third-party administrator of workers’ compensation claims hired to administer claims, suspected fraud.
The injured worker told Tristar that she loaned half the permanent disability payments to the district employee and said she didn’t know her claim wasn’t worth $85,000 according to the insurance department. (workersxzcompxzkit)
The worker said she made several attempts to contact her “friend” to get her to repay the loan without success. The money was never paid back to the injured worker.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
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