Improve Employee Attitudes & Expectations to Save Work Comp Costs

An injured worker with a positive attitude is much easier to deal with than a Negative Nelly. Someone who has an optimistic outlook is more likely to engage in his own recovery and do what it takes to get back to work. It makes the whole process easier and typically results in better outcomes for the worker and the organization.

 

The reality is that not all injured workers have a rosy view of their situations or their companies. Working with them is more difficult, may take longer, and very well may have poorer outcomes. But organizations can take steps that improve the attitudes of their workers. By creating a culture of safety and sending a message of genuine concern for their employees, organizations can set a better tone for workers who subsequently become injured.

 

 

Pre-Framing

 

Tony Robbins believes he can get nearly anyone to do anything, based on how he frames a situation. The motivational speaker/life coach/multi-billion dollar entrepreneur explains that a person’s frame of reference is key to how they feel and how they will behave. Pre-framing is about creating expectations and the state of mind someone has going into a certain environment.

 

Employees who become injured have a set of beliefs and expectations in terms of how their situations will be handled. Here’s how this might play out among injured workers with the same injury:

 

  • Negative Nelly. This employee has been given no reason to trust her employer, and doesn’t. While she is fine with her job, she has no illusions that her company cares about her one way or the other. Added to that is the fact that she has no idea how the workers’ compensation system is supposed to work. Since she doesn’t believe her employer has her best interests at heart, she relies on family and friends for advice. In all likelihood, she will “lawyer up”.

 

  • Positive Pete. His company stresses the value of its employees, clearly demonstrating they are the top priority. There is a culture of safety that is practiced from the C-suite down to the lowest level employee. In addition to avoiding injuries, Pete and his coworkers truly believe their employer wants to protect them from harm. Additionally, the company provides information about the workers’ compensation process, including a return to work program. Pete knows what to expect and believes his employer wants him to recover and get back to making a difference at the company. He readily cooperates with all involved in his claim, and goes back to work in a light duty capacity fairly quickly.

 

Nelly and Pete were on a level playing field when they had their injuries; that is, they both had a shoulder injury. But after a few weeks Pete has had physical therapy, is doing specific exercises at home, and is back at the company and looking forward to being able to resume his full-duty work. Nelly, however, is awaiting an MRI, has been advised she will probably need surgery and, in the meantime, has borrowed pain meds from a friend to get her through.

 

After just a short time, it’s obvious Nelly’s claim will continue for some time and could cost substantially more than Pete’s. There may be psychosocial risk factors and/or comorbidities present with Nelly; however the main difference between the two was their attitudes.

 

 

What to Do

 

Improving expectations and attitudes among employees involves a variety of steps. At its core, it must be real; that is, top executives must be committed to caring for their employees, not just paying lip service.

 

For example, simply putting up posters that advocate safety should not be the only step. There must also be actions throughout the organization in order to create a culture of safety and well-being.

 

  • Eyewash stations should be present where workers may be exposed to chemicals.
  • Personal protective equipment should be easily available when needed, and workers should be trained in advance on using it.
  • Repairs to broken equipment need to be made as soon as possible, and the equipment should be taken out of service in the meantime.
  • Safety meetings should be conducted on an ongoing basis and employees at all levels should be involved in the work of a safety committee.

 

 

Several additional steps can increase employees’ trust in an organization.

 

  1. Messaging. Consistent, clear, positive messages can show the company is concerned about its employees.

 

– The safety and workers’ compensation programs should have similar branding. Both should stress that employees are the number one asset, and protecting employees is the top goal.

 

– Messages about safety should emphasize the importance of keeping employees injury-free because it is in their own best interests, not just the company’s.

 

  1. Communicate. Supervisors and others who work with an injured employee should contact him early and often. That sends the message to all employees that the employer cares about them. It also keeps the injured worker from feeling isolated and abandoned by the company.

 

  1. Wellness program. Programs that seek to improve employees’ health send the message that the employer is concerned. It demonstrates the company is committed to its workers.

 

  1. Outline injury management program. Employees who are injured at work should know what to do and what to expect. Along with safety messages, the employer should provide information on the workers’ compensation system. This too sends the message that employees are the company’s top priority.

 

  1. Incentivize the right behaviors. Organizations that reward their workers for having zero accidents do a disservice. The message being sent is that workers should not report injuries. Instead, you want to encourage and reward safe behaviors. Offering incentives for employees that follow agreed upon safe behaviors encourages them to behave in ways that will avoid injuries. However, when injuries do happen, you want to use that as an opportunity to develop safer behaviors.

 

 

Conclusion

 

Injured workers enter the workers’ compensation system with all sorts of preconceived notions and expectations. Showing genuine concern for employees can ensure more injured workers will have positive rather than negative attitudes.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Using Benefit Offsets to Reduce Work Comp Costs

Reducing costs in your workers’ compensation program includes understanding the concept of offsets against workers’ compensation benefits.  This is something that often does not occur.  When it does, however, the result is program paying benefits that otherwise should not be paid.  A review of your workers’ compensation program to identify and implement applicable offsets can result in immediate savings to your program.

 

 

Understanding the Concept of Benefit Offsets

 

The ability to offset workers’ compensation benefits against collateral sources has its origins in the belief that someone suffering a personal injury should not reap a windfall.  In many jurisdictions, these same offsets are available under a workers’ compensation act for indemnity benefits an employee may be receiving from a government program.  These benefits include:

 

  • Social Security Disability (SSDI) benefits;
  • Social Security Disability (SSDI)Reverse Offsets
  • Prior Injury offsets;
  • Retirement annuities from public employee organizations; and
  • Various pension benefits received from a labor union health and welfare funds.

 

 

Application of the Offset Process

 

Statute or case law often define allowable offsets.  In some jurisdictions, the law explicitly prohibits these offsets.  It is important to understand the law in your state before you seek to reduce the amount being paid in workers’ compensation indemnity benefits.

 

 

Social Security Disability Benefit Offsets

 

A seriously injured employee can collect both workers’ compensation benefits and Social Security Disability benefits (SSD) if the Social Security Disability requirements are met. To prevent employees from collecting excessive workers’ compensation benefits and SSD benefits, state laws define the maximum benefit wage the employee can receive. In most states, the amount of Social Security Disability is offset by the workers’ compensation indemnity paid.

 

Example: An injured employee is collecting permanent partial disability (PPD) at the rate of $300 per week, or $1,300 per month (four and one-third weeks). The employee applies for Social Security Disability (SSD) and is approved. Based on prior earnings, the employee is eligible to collect $1,500 per month from the Social Security Administration (SSA).

 

With the workers’ compensation offset, SSA pays the employee $200 per month ($1,500 SSD minus $1,300 PPD). When the employee’s PPD is exhausted, the SSD will revert back to $1,500/month.

 

 

Social Security Reverse Offsets

 

A few states have a reverse offset, allowing the workers’ compensation carrier to take a credit for the amount paid in SSD benefits. Be sure your adjuster knows if the state allows a reverse offset for workers’ compensation indemnity benefits paid to an employee who is also collecting SSD.

 

In the previous example, with a reverse offset, the carrier would pay no PPD, as the SSD is greater than the PPD.

 

Example – A reverse offset: An employee collects $1,300 a month in PPD and is approved for $1,000 per month in SSD. The employee is paid $300 per month ($1,300 minus $1,000) by the workers’ compensation carrier. When PPD is exhausted, the employee then collects a $1,000 in SSD per month.

 

 

Prior Injury Offsets

 

Another deduction sometimes overlooked is the pre-existing permanent partial disability rating the employee has from a prior injury, often at a different employer.

 

Example: The employee suffered a back injury fifteen years ago while working for another company. The back claim was settled with the prior workers’ compensation carrier, based on a 10% permanency rating.

 

A year ago, the same worker suffers a back injury while working for your company. The treating physician and the IME doctor both give the employee a 25% permanency rating, which includes the pre-existing condition.

 

Most states allow you to deduct the prior permanency. This allows the adjuster to settle the claim for the value of a 15% rating (25% minus the prior 10% rating).

 

 

Other Factors to Consider

 

There are various issues to consider when applying an offset against applicable benefits.  It is important to consider the rules and requirements when seeking to take advantage of this compensation structure.  Important considerations include:

 

  • Offsets are often only allowed to be taken for the actual amounts an employee or their dependents receive and not the amounts they may be entitled to receive. This situation is common when an employee voluntarily decides to receive a reduced collateral benefit.

 

  • Employers and insurers can often offset the amount the employee was receiving prior to the work injury. The rationale for this is rooted in the understanding an employee’s earning capacity changes following an injury.  This change in income impacts their collateral benefits.

 

  • Benefits can be recategorized in order to achieve the offset threshold amount. This often occurs when temporary total disability benefits are recategorized to permanent total disability benefits.  Most jurisdictions that allow this find it permissible to do this on a retroactive basis.

 

Conclusions

 

It is common for workers’ compensation programs to overlook collateral source offsets.  This is a costly error that can easily be corrected and result in immediate savings to many programs.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Move Workers’ Comp Claims to Settlement with Empathy

An injured worker with an open claim for 15 years finally agreed to settle, and it all came down to an extra $2,000 – $3,000 for a much wanted trip to Alaska. This real claim is very common in our industry and points to a glaring deficiency: a total lack of empathy for the injured worker.

 

Companies often have many cases that have been on the books for months or even years. Adjusters may have approached the injured workers to see if they’d like to settle and learned, as much as the claimant doesn’t like the workers’ compensation system, he has no interest in closing the case.

 

There are myriad reasons for not settling a claim, but there is no way to know the real reason unless someone asks. That’s where a professional administrator can make a huge impact.

 

 

Reasons Claims Stay Open

 

Workers’ compensation claims are not like fine wine; they don’t improve with age. So keeping a claim open indefinitely doesn’t make good business sense, and it’s often not in the best interest of the injured worker, either.

 

The many reasons injured workers don’t want to settle their claims include:

 

  • Disagreement on total value.
  • Advice from attorneys, family members or friends not to settle.
  • Concern they will run out of money.
  • Fearful of going it on their own — even if they don’t like having to deal with a claims adjuster or having medical treatment denied.
  • Don’t know how to ensure they are complying with various laws and regulations, such as Medicare.

 

And perhaps the biggest reason — they are afraid of change. Much as they may abhor dealing with the workers’ compensation system, the alternative seems worse. As the saying goes, ‘better the devil you know than the devil you don’t.’

 

So how can companies best address these legacy claims? Possibly with a neutral third party.

 

 

Professional Administrators

 

The claim noted above settled when a professional administrator became involved and, more importantly, spent some time getting to know the injured worker. He met with the worker and learned that he and his wife had dreamed of going to Alaska but were never able to because of his injuries and the fear they would not have enough money in the future. He then went to the carrier to see if additional monies could be added to the most recently proposed settlement. When he told the couple that the insurer had agreed to an additional $2,000 to $3,000, the injured worker and his wife broke down in tears and agreed to the settlement.

 

Showing empathy for an injured worker is key to getting an agreement. Injured workers need to be heard and understood. Those with long-term claims have had their lives turned upside down. Someone willing to listen and grasp their needs can have a major impact on moving the claim toward closure.

 

The presence of the professional administrator added several other positive elements to the scenario.

 

  • Advocacy. He explained exactly how the settlement would address the injured worker’s future needs. A professional administrator acts as an advocate for the employee throughout his life, helping to direct him to medical providers and dealing with the settlement money. That addresses one of the main concerns of employees reluctant to settle — the idea that someone will still be there to guide them through the process.

 

  • Neutral party. Professional administrators secure substantial discounts through their medical networks, which is also how they are paid. The fact that it is a neutral party adds another element of comfort for the injured worker.

 

  • No more denials. Also, he explained to the injured worker that he would no longer face denials for requested medical treatment, once the settlement was completed.

 

Experienced professional administrators are able to think outside the box.

 

 

Summary

 

Injured workers are in a situation they did not seek nor expect, and are typically fearful of having no money for future medical issues, and to take care of their families.

 

Having an advocate who is a neutral party can understand their needs and coordinate a successful settlement to help them get on with their lives and get their claims closed.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

7 Habits of a Highly Effective Worker’ Comp Program

A best-selling book published 30 years ago as of 2018 holds valuable lessons for the workers’ compensation industry. Called the 7 Habits of Highly Effective People®, it outlined strategies based on the principles of fairness, integrity, honesty and human dignity; all of which can serve as best practices.

 

 

The Habits

 

Stephen R. Covey’s book resonated with organizations as well as individuals. The 7 habits include three related to moving from dependence to independence (or self-mastery), 3 focused on interdependence, and the 7th as striving for continuous improvement.

 

 

The Independence habits included

 

  • Be Proactive. Rather than operating in a reactive mode waiting for things to happen, the idea is to take responsibility.

 

  • Begin with the End in Mind. This called for clearly visualizing the ultimate goal then working toward it.

 

  • Put First Things First. This addresses priorities.

 

 

Interdependence habits

 

  • Think Win-win. The idea here is that there doesn’t need to be a ‘loser’ in order for there to be a ‘winner;’ instead, when one wins, everybody wins.

 

  • Seek First To Understand, Then To Be Understood. The goal here is active listening; truly hearing what another person is saying before you speak.

 

  • By working together with open minds, people can accomplish more and better results than they would individually.

 

Sharpen the Saw is the 7th habit. This means staying sharp and increasing effectiveness by renewing yourself mentally and physically.

 

 

The 7 Habits of a Highly Effective Workers’ Comp Program

 

Whether creating a workers’ compensation program from scratch or trying to improve an existing one, the 7 habits can easily be translated for optimal outcomes.

 

  1. Be proactive. Taking responsibility means anticipating and mitigating risks to prevent injuries from occurring. A hazard identification and assessment is a must for any workers’ compensation program; it not only can prevent a workers’ compensation claim, but it also helps create a culture of safety and shows employees you care about them. all injuries and illnesses as well as near-misses, and encouraging and listening to employees’ concerns about safety..

 

  1. Begin with the end in mind. If you were to imagine the perfect workers’ compensation program for your organization, what would it look like? Would it mean fewer accidents? Quicker claims processing? Faster reporting of incidents and near misses? Better investigations into injuries? What elements would be included? In designing or refining your workers’ compensation program you need to start by clarifying the vision of what you want. Working with others — managers, supervisors, employees, the carrier, TPA — you can brainstorm and come up with a model, then create a mission statement that includes the goals that are aligned with those of the organization’s. Achieving best outcomes is possible only when you’ve defined what ‘best outcomes’ means to your company.

 

  1. Put first things first. This is a continuation of the habit #2. In that, you have visualized and defined the ideal workers’ compensation program. This step is creating that program. You need to determine what the most important elements in the program are and focus on those first; the priorities that are both important and urgent.

 

  1. Think win-win. An effective return-to-work program is an example of a win-win situation; the worker wins by recovering and getting back to work and the organization wins by saving money and reducing lost productivity. Creating a win-win culture can be difficult, as many of us believe one person must lose for another to succeed. Instead of a competitive environment, a cooperative atmosphere can benefit all involved.

 

  1. Seek to understand, then be understood. If you’ve ever had a sales person try to push you into a product in which you have no interest, you understand the need to be heard. Active listening means just that — listening to what the other person says without creating your response as they are speaking. This is especially important when talking with an injured worker. Listen to his concerns and frustrations with an open mind — there could be a simple solution. Ask what questions he has and answer them. Spend a few minutes trying to better understand what he is going through.

 

  1. Synergize. 2+2 = 5; meaning the outcome is greater than the sum of its parts. This speaks to breaking down silos. Sharing information, brainstorming, and coming up with new approaches to continuing problems is invaluable. Keeping an open mind is key.

 

  1. Sharpen the saw. Now that you’ve developed a great program, you can’t rest on your laurels. A workers’ compensation program should be a work in progress, as you constantly strive to improve it. Measuring and analyzing results is critical, then you can find and implement best ways to approach challenges.

 

 

Conclusion

 

A company isn’t ‘lucky’ if it has few workers’ compensation claims in a given period. While that may happen on a rare occasion, organizations that spend time and effort developing, implementing and refining their injury management programs will see consistent

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

15 Activities Every Employer Can Do Post Workers’ Comp Injury

Too many employers end their involvement in the workers compensation claim  when they send the employee to the doctor. A bad mistake – one resulting in a steady increase in the amount of your workers compensation insurance premium.

 


The employer needs to have an established post injury process to include:

 

  1. Report the claim to the insurer, third party administrator or self-insured claims office immediately. Ideally the supervisor or your workers compensation claims coordinator reports the claim to the claims office while the employee is still en-route to the medical provider.  Or, you can start the process by calling nurse triage, a great way to make sure the employee gets the RIGHT kind of medical treatment. In some cases, the injury will not turn into a claim by using nurse triage.
  2. Complete the Employer’s First Report of Injury and any other state required paperwork on the claim. If the injury is severe and the employee is unable to return to work within the waiting period, provide the claims office with necessary wage information for the calculation of indemnity benefits.
  3. Advise the claims office of the claimant’s prior history of workers compensation claims. The adjuster’s approach to the claim varies significantly between the employee who never had a workers compensation claim and the employee who with 15 workers compensation claims in the last ten years.
  4. Provide the adjuster with relevant information about the employee. In many situations this may include employee information such as employment application, job description, list of medical absences, list of disputes with employee/employer disputes.
  5. Review your transitional duty program and find a job the employee can do within the treating physician’s restrictions. Have a job bank with tasks in multiple departments set up and ready to go, so there is no delay in placing every injured employee in a transitional duty task. In most states, it is best to  pay as close to their original pay as possible to reduce indemnity payments.
  6. Be sure the employee’s supervisor (and co-workers if needed) is available to discuss the accident and injury with the claims adjuster and to assist the adjuster with the claims investigation.
  7. Don’t alienate the employee – show empathy to the employee. When employees feel the company does not care about them and their injury and the company owes them, the claim gets ugly if employees feel it is time to stick it to the employer.
  8. Maintain an open dialogue – call the employee at home to show your concern and to offer assistance on processing the workers compensation claim with the insurance company. Address any employee problems or issues right away. Also, call the employee on a regular basis until s/he is back at work. Make this contact procedure the same for all employees.
  9. If an attorney representing the employee contacts you, notify the claims adjuster immediately.
  10. Immediately dispute any invalid or fraudulent claim. Assume every employee who reports an injury is injured, but when you notice things don’t add up, let your adjuster know. Using nurse triage services greatly reduces fake injury reporting because a nurse specialized in triage will ask many questions about the medical condition, and most employees faking an injury will look for easier prey.
  11. If the employee has a questionable claim, or a subjective claim for neck or back injuries, and immediately goes to the attorney advertising workers compensation on television, or a plaintiff’s attorney-oriented doctor known for excessive disability ratings, advise the employee immediately of your intention to fight the claim as the attorney and/or doctor has a history of inflated claims.
  12. Monitor the state filings by the adjuster and any other claim related paperwork.
  13. Monitor the Workers’ Compensation Board decisions – that means, reading them carefully, not just filing them away. Be ready to protest any finding or order you feel is unfair to you as the employer as all decisions have time limits for disputing the decision, with some time limits as short as 15 days.
  14. Monitor the medical progress reports to be sure the treatment is appropriate – for example – no physical therapy for the low back when the injury is a cut finger.
  15. Always advise the adjuster when the employee returns to work – the same day. Double-check to make sure the indemnity payments stop when the employee returns to work.

 

Stay involved with the adjuster, the employee and the medical providers. As long as it’s an open claim, it can affect your experience rating, so dropping the claim on the adjuster’s desk is the WORST thing an employer can do. Ask your broker’s claim VP and the adjusters to discuss the open claims during a round-table discussion often, either weekly, bi-weekly, or monthly.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Steps to Take for 5 Common Areas of Employee Workers’ Comp Fraud

When employees file fraudulent workers compensation claims, not only are they stealing from the insurance company, but also stealing from their employer, the shareholders of the employer if a publicly held company, and from their co-workers. The fraudulent workers comp claim is included in the claim history used by the insurance company to set the premium rates for the employer. When the employer pays higher insurance cost due to fraud, there is less money available to invest in the company and to pay the wages and pay raises of the employees of the company.

 

Nearly 25% of workers comp claims involve some element of fraud or malingering, whether it is an outright false claim or inflation of an otherwise legitimate claim. The Coalition Against Insurance Fraud estimates workers compensation fraud cost employers $6 billion a year. The National Insurance Crime Bureau recently reported the number of suspicious or questionable claims has increased as the economy has deteriorated. In fact, workers comp fraud is the second largest category of white-collar fraud only behind income tax evasion. Every employer must be vigilant in protecting themselves from the dishonest employees who will attempt to exploit the workers comp claim system.

 

 

There are five common areas of employee workers comp fraud:

 

  1. The false injury. The employee claims a hurt back or neck or other muscle problems for the sole purpose of collecting indemnity benefits.
  2. The inflated injury. The employee receives a real job related injury but then tries to extend his/her time off work by pretending the injury is worse than it really is so s/he can collect indemnity benefits.
  3. The prior injury. The employee has a real back, shoulder or knee problem from years ago, but now needs additional medical treatment for it.
  4. The at-home injury. The employee gets hurt at home, working for someone else or participating in a sports event, and claims s/he got hurt on the job.
  5. The malinger. The employee got hurt, got well, but got use to staying home and does not want to come back to work.

 

There are several courses of action the employer can take to combat workers comp claim fraud. One of the most effective things an employer can do reduce workers comp claim fraud is to have a well publicized and well used transitional duty or light duty return to work program. While a return to work program will not prevent all fraudulent workers comp claims, it will stop many of them.

The dishonest employee who got hurt at home but does not have medical insurance, or has medical insurance with a high deductible, will still file the fraudulent claim that he got hurt at work. However, the dishonest employee who wants to take an extended paid vacation with workers comp indemnity benefits, or the dishonest employee who wants to work at another job while collecting workers comp benefits, will be stopped from doing so by a strong transitional duty program.

 

 

Steps to Prevent Workers’ Comp Fraud

 

In addition to a strong transitional duty program, there are various other steps the employer can take to fight fraudulent claims including:

 

  1. Do not hire employees of questionable character or background. Prior to any offer of employment, thoroughly check the references of the potential employee and their background information.
  2. If an employee refuses transitional duty work, or tries transitional duty work for an hour or two, or a day or two and then stops, make an immediate inquiry into what part of the transitional duty job can’t be done. Make arrangements to alter the transitional duty job to fit the complaints. If the employee still refuses the transitional duty work, ask the insurer’s claims office to consider surveillance on the employee to be sure the limitations away from work are the same as when at work.
  3. Keep an ear open to the rumor mill. Disgruntled employees are far more likely to file a fraudulent workers comp claim then happy employees. Address any legitimate grips or complaints of the employees.
  4. Train your supervisors and department managers to recognize the characteristics of claims frequently indicating fraud. Provide the supervisors and department managers with a copy of our blog on Employee Workers Compensation Fraud
  5. Make sure all new and current employees are aware of your fraud policy of prosecuting workers comp fraud as a criminal offense. (And back it up! If you have an employee who commits workers comp fraud be sure to fully prosecute. If you want to see the number of your workers comp claims skyrocket, feel sorry for the employee or his family and not prosecute an obviously fraudulent claim).
  6. Make sure all employees understand that fraudulent claims come out of the employer’s pocket and reduce the pay raises or bonuses for everyone.
  7. When you suspect a workers comp claim may be fraudulent or when you have rumors or evidence that a claim has an element of fraud, contact the workers comp insurer’s Special Investigative Unit. They have the expertise and the connections with law enforcement to properly investigate and build the necessary proof to prosecute the fraud.
  8. Make it a requirement that the claims handling office of the insurer or third party administrator files an Insurance Services Office index report on every new workers comp claim and does a claims inquiry every six months as long as a claim remains open.
  9. Do not make it easy for the employee to file a bogus claim by having a loose safety program. By removing safety hazards from the work place, the employee has fewer options in creating a false injury scenario.
  10. Remember many fraudulent claims start out with a real injury. When the employee sees the television commercial with somebody holding fists full of money their attorney got them for their workers comp injury, the employee may be tempted to exaggerate his/her own claim. Anytime an employee hires a television attorney, you cannot discuss the claim with the employee, but you can advise the employee of the company’s policy to fight all claims vigorously when an attorney is hired.
  11. Make it a practice to reward fraud tips. Have a publicized program of paying a reward to anyone who reports a workers comp fraud resulting in conviction.

 

Fighting fraudulent workers comp claims is not easy, but it is absolutely necessary to protect your company’s bottom line. Make fraud prevention a component of your integrated workers compensation program.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Using Data to Make Your Next Benefit Decision & Other Top News Tidbits

Broadspires’ Danielle Lisenbey Featured in Influential Women in Re/Insurance 2017

 

The risk transfer business remains a male-dominated industry although that is changing quickly. Instead of focusing on lack of woman in our industry, we instead focus on the talent that does exist – and how this pool is growing and maturing by the day.

 

 

Using Data to Make Your Next Benefit Decision

 

By 2020, 83% of employers will offer a consumer-directed health plan (CDHPs). These plans are characterized by cost sharing between employer and member, where high deductibles and out of pocket limits are the tradeoff for lower premiums and tax benefits.

 

As consumers find themselves responsible for a larger portion of their healthcare bill, Express Scripts is committed to protecting patients by improving health outcomes while driving down costs. We do this by leveraging vast data insights that individuals can actually act on.

 

 

Preventing Falls: Make Your Health a Priority

 

Having a health problem can make you more likely to fall. Taking certain kinds of medicines may also increase your risk of falls. So, improving your health can help you avoid a fall. Work with your healthcare provider to manage health problems and to review your medicines. If you have your health under control, your risk of falling is lessened.

 

 

Arizona Full and Final Settlements: What You Need to Know

 

As of November 1st, Senate Bill 1332 will allow for Arizona full and final workers’ compensation settlements. This new law allows future medical claims to be settled full and final, meaning they cannot be re-opened or changed in any way. Prior to this change, injured workers reserved the right to re-open claims for added medical treatment if the injury worsened or required additional care.

 

Opioids in the MSA… Challenges and Strategies

 

If seeing the word opioids one more time doesn’t trigger some sort of reaction, whether sadness, anger, desperation,  or possibly hope at what appears to be traction to ‘Turn the Tide’ of addiction, then I can only surmise that you must live under a rock!  That certainly isn’t the case here, as in our world of MSP compliance, the word opioids is either read, spoken or written every single day.  It permeates our industry and our lives.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

 

The Art – 7 Considerations When Using a Structured Settlement

They say the only certainties in life are death and taxes; but annuities can also be included on the short list. Among investments, annuities are one of the few that are virtually guaranteed.

 

That fact bodes well for injured workers concerned about their immediate and long-term financial needs. Well-designed structured settlements that are funded through annuities are tax-free, guaranteed, and incur no risk.

 

Workers’ compensation stakeholders who utilize them can ensure injured workers and their families are fully protected. The key is to find partners who have a deep understanding of these financial vehicles and the insight to identify the true needs of those affected.

 

 

When & Why Structured Settlement

 

Structured settlements are available to injured workers to settle their claims. They are an alternative to taking a set amount of cash in one lump sum.

 

While structured settlements have been around for decades, there are many misconceptions.  They may not be appropriate for every injured worker, they are certainly worth considering on every settlement case.

 

One reason injured workers may opt for a lump sum over a steady income stream is the belief they can get a better rate of return and end up with more money on their own. Unfortunately, there are ample studies showing that just isn’t true. The longer time goes on, the more people who have chosen a lump sum say they have less money than expected and not enough for living expenses. Along with the tax-free status is the time value of money. In the end, it adds up to being able to meet financial obligations long term with money paid out through a structured settlement.

 

Having the income stream from a structured settlement funded through an annuity — as most are — assures there are no associated taxes, which makes a significant difference compared to normal investments. To get the same net rate of return from a typical investment compared to a tax-free annuity would often require putting the money in a high-risk vehicle with a steady, high interest rate, something that is very difficult and rare.

 

One survey of 1,000 people presented them with a hypothetical scenario and asked whether they would prefer a lump sum payment or a structured settlement. The majority chose a single payment and cited financial independence, paying off a large loan, and flexibility as their reasons.

 

The fact is, changes in laws and regulations since the 1970s have made structured settlements very flexible, along with guaranteed elements. Structured settlements today come in all sorts of shapes and sizes, depending on a person’s needs. For example, many people, take a sizable amount of cash up front to pay medical bills and/or debts, then have the rest paid out in certain increments at over time. While the bases of structured settlements are the same, it’s important to understand current and future needs to get the right formula.

 

 

The Art – 7 Considerations When Using a Structured Settlement

 

Structured settlements need to be constructed differently for each injured worker, depending on his needs. There is no ‘cookie-cutter’ settlement. Each requires a basic life care plan with future needs and expenses included.

 

One or more annuities may be included in a structured settlement. These should be purchased from high-rated insurance companies to ensure financial strength.

 

Among the factors that may be included in are the following:

 

  1. Immediate expenses. Many structured settlements include upfront cash to cover such things as medical expenses, ongoing debts/loans, and attorneys’ fees.
  2. Monthly payouts. A typical structured settlement would also include a set amount per month for a specified number of years, and include a cost-of-living adjustment. For example, the amount could cover mortgage and other associated payments for 20 years.
  3. College education. If the injured worker has children, money would likely be included for college education. In addition to a monthly expenditure, a structured settlement could include, for example, an annual payment of $15,000 for a certain four-year period.
  4. Retirement funding. Some structured settlements also include a lump sum payment at the anticipated retirement year to supplement Social Security. Alternatively, a monthly amount on top of that previously established could kick in with retirement, to help pay for travel and purchases for grandchildren.
  5. Non-life contingent payments. Structured settlements can also allow for designated beneficiaries to continue receiving the future payments tax-free in the event of the injured worker’s premature death.
  6. Public Benefits. Even a small settlement can disqualify an injured worker from public benefit programs like Supplemental Security Income and Medicaid. A special needs trust funded with a structured settlement can help maintain eligibility and protect the employee’s long-term security.
  7. MSA. Medicare’s interests must be considered when someone settles past, present or future medical expenses to avoid jeopardizing these benefits or expose the injured worker to fines or penalties. In some cases, a Medicare Set-aside may be needed.

 

Summary

 

Injured workers and payers looking to close claims may find the best value for all sides through a structured settlement rather than a lump sum payment. When an experienced structured settlement expert is involved and the employee’s current and future needs are included, all stakeholders can see a win-win.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

63 Items To Look For In Your TPA or Carrier Claim Report

Your company is self-insured and hired a Third Party Administrator (TPA) to handle your workers’ compensation claims.  As part of the servicing agreement with your TPA, the TPA agreed to complete a written report within 14 days of assignment on new workers’ compensation claim s with reserves over $10,000.   Here are some guidelines as to what the reports should contain.

 

All reports should be laid out in a consistent format for ease of reading. The reports should provide you with all essential information without you having to go on-line to read the entire claim file. The better adjusters will always use the same format, but if the adjuster does not, feel free to provide the following reporting sample outline for captions and sub-captions to the adjuster.   This is the minimum you should expect to see in the initial claims’ reports.

 

 

Coverage

 

Some adjusters will want to skip the coverage caption figuring your company would not have reported the claim if it was not covered. That can be a big mistake if your deductible, self-insured retention or other terms of coverage change at renewal or any other time).

 

  1. Policy number (if one is assigned) and policy dates
  2. Applicable deductible, self insured retention , endorsements
  3. Alternative or duel coverage

 

 

Description of Accident

 

  1. Date and time of day
  2. Place (Where the accident occurred on the premises, or other location if off the premises)
  3. What was the employee doing when the injury occurred
  4. Regular job for the employee or outside the norm for the employee
  5. Date the accident was reported to supervisor or manager
  6. Date the accident was reported to the claims coordinator for your company

 

 

Insured

 

  1. Name of Unit/Division/Branch
  2. Location (Street address, City & State), also the location code number (if one is assigned)
  3. The nature of the business/work performed at this location

 

 

Employee

 

  1. Full name
  2. Age/Date of Birth
  3. Number and relationship of dependents ( in states where dependents affect indemnity benefits)
  4. Detailed job description/occupation
  5. Length of employment, length of time in current job description
  6. Prior injuries, both work com and liability claims reported to the index bureau
  7. Summary of recorded statement or interview
  8. Social security (edited for confidentiality if required by state law)
  9. Education level of employee
  10. (If represented) Attorney for employee—name, address, expertise

 

 

Jurisdiction

 

  1. Statutory state benefits
  2. Federal (Longshore & Harborworkers Act, Federal Employment Liability Act, Jones Act)
  3. Potential Employers Liability exposure

 

 

Compensability

 

  1. Why the claim is compensable
  2. Why the claim is being controverted

 

 

Reserves

 

  1. Amounts for indemnity, medical, legal, rehabilitation and other expenses should be individually stated
  2. Adequacy for life of claim should be discussed

 

 

Indemnity Benefits

 

  1. Average weekly wage amount and how documented
  2. Compensation rate and how calculated
  3. Specific benefits due to permanent impairment, scarring (where allowed), etc.

 

 

Injury

 

  1. Nature of injury
  2. Attending physician(s) and specialists identified
  3. Hospitalization, discharged date or anticipated discharge date
  4. Type of future medical care and projected length of care
  5. Estimated length of temporary total disability
  6. Estimated Return To Work date, modified duty and/or regular duty
  7. Independent Medical Evaluation (if the jurisdiction allows more than one, if not the IME should be saved until the employee is at maximum medical improvement)
  8. Permanent impairment rating (expected or assigned)

 

 

Rehabilitation

 

  1. Vocational
  2. Physical
  3. Length of rehabilitation
  4. Facility or provider
  5. Reasons/justification for rehabilitation

 

 

Second Injury Fund (in states where it still exists)

 

  1. Nature of employee’s prior injury, disability or medical condition
  2. Statutory requirements to access the Second Injury Fund
  3. Self insurers’ rights of recovery

 

 

Subrogation

 

  1. Identification of responsible third party
  2. Negligence theory
  3. Expert testimony (if needed)
  4. Preservation of evidence
  5. Issues affecting pursuit of subrogation such as hold harmless agreements, contracts, business relationships, possibility of a cross-claim against your company
  6. Recovery amount
  7. Employee’s right of recovery

 

 

Litigation/Legal Expense

 

If the claim is being contested before a workers’ compensation board or in a court, the following information is needed:

  1. Defense attorney’s name, firm’s name, address
  2. Issue(s) in contention
  3. Probable outcome
  4. Legal budget

 

 

Action Plan

 

  1. Steps to be taken to move the file forward
  2. Barriers to resolving the claims

 

 

Diary for Future Reports

 

  1. Date an updated status report will be provided

 

 

Attachments

 

  1. List of attachments or documentation being provided, if any

 

 

Summary

 

The adjuster’s report should provide you with all the information needed to keep you totally informed about the claim in question.   If after reading the adjuster’s report you still have questions, add a caption or category to reporting format to answer your question on all future work comp claims.

 

The adjuster should provide status reports on a regular basis of 30 days to 90 days depending upon the developments on the claim. Status reports should not repeat the information provided in the initial reports, but only cover the categories where there has been a change or a new development that impacts the claim.

 

Proper reporting by the work comp adjuster will make your life easier in the management of your self-insured program.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

7 Ways to Protect Employees from Work Related Auto Fatalities

Distracted- and drowsy-driving fatalities are down; however the overall number of motor vehicle crashes was up in 2016. The latest figures from the Department of Transportation’s National Highway Traffic Safety Administration reflect the number of motor vehicle fatalities in all 50 states and the District of Columbia.

 

Overall, there were 37,461 motor vehicle deaths last year. The fatality rate of 1.18 deaths per 100 million vehicle miles traveled represents a 2.6-percent increase from the previous year. The vast majority of crashes are linked to ‘human choices,’ according to the NHTSA. The figures point to the continued need for employers to keep their employees safe behind the wheel — especially the youngest and oldest workers.

 

 

The Facts

 

While there was an overall 2.2 increase in the number of vehicle miles traveled on U.S. roads last year, that doesn’t account for the 5.6 percent increase in fatalities. Distracted related deaths decreased by 2.2 percent and drowsy driving fatalities were reduced by 3.5 percent, but other factors increased:

 

  • Drunk-driving deaths were up by 1.7 per­cent.
  • Speeding-related deaths increased by 4 percent.
  • Failure to wear seatbelts contributed to an increase in deaths of 4.6 percent.
  • Motorcyclist deaths increased by 5.1 percent and were the highest since 2008.
  • Pedestrian deaths were up by 9 percent, the most since 1990.
  • Bicyclist deaths increased by 1.3 percent, and were the highest since 1991.

 

Workers who are especially at risk of motor vehicle fatalities include the young — aged 16 to 24 — and older workers, of at least 55 years.

 

  • Between 2011 and 2015, 470 workers in the younger age segment were killed in auto crashes at work. That accounted for more than 1/4 of all work related deaths in that age bracket.
  • Motor vehicle crashes account for nearly 1/3 of all work-related deaths among workers age 55 or older.

 

 

Develop Policies

 

All employers who have workers that drive for business should have specific policies to ensure safe driving.  These should include:

 

  • A ban on texting and hand-held phone use while driving.
  • A prohibition on driving while a worker is under the influence of alcohol, illegal drugs or certain prescription and over-the counter medications that may impact driving.
  • Periodic training provided to promote safe driving strategies and discuss changes in road rules.
  • Breaks during the work shift.
  • Allowance for workers to take short naps — 30 minutes or less — in a safe location if they are tired while driving.
  • Information on sleep disorders and other illnesses that may impact drowsiness.

 

Special attention should be paid to younger and older employees to ensure their safety on the road.

 

 

Protecting New Drivers

 

Young workers have the highest crash rate based on miles driven, largely due to their inexperience. They are typically less able than other workers to recognize and respond to traffic risks.

 

There are several steps employers should take to prevent accidents among the youngest workers.

 

1) Know the law. Young workers are restricted in terms of whether, when and how long they can drive for work.

  • Workers age 16 and under in non-agricultural jobs may not drive for work.
  • Workers age 17 may drive on public roads in non-agricultural jobs, but are limited by time and task: They must first complete a state-approved driver’s ed course and have no record of moving violations at hiring time; Their driving time may not exceed 33 percent of their workday, and 20 percent of their work week; Their driving must be done only during daylight hours.; They can only drive vehicles that are no more than 6,000 gross vehicle weight and have seatbelts for all occupations.; They are not allowed to tow another vehicle.; They cannot drive more than a 30 mile radius from the primary work place.  Workers under age 21 are generally not permitted to drive a commercial motor vehicle across state lines.

 

2) Do background checks. Before hiring a young worker to drive, make sure he has a valid state license and has no record of moving violations.

 

3) Take precautions. Before sending the worker out on the road, make sure the assignment follows state laws for such things as nigh driving restrictions and transporting other teens. Additionally, make sure the worker has been trained on the safety features of the vehicle to be driven.

 

 

Reducing Risks for Older Workers

 

While older workers are more likely to adhere to safety regulations – such as wearing seatbelts, they have twice the risk of dying when they do get into a work-related accident compared to younger workers.

 

Part of the reason they have accidents is due to a decline in their physical and mental abilities that coincide with the aging process. Eyesight, hearing, motor skills and cognitive function can deteriorate with age. Employers should consider the needs of older workers in their safety and health programs.

 

4) Reconsider the options. Reducing the amount of time older workers are driving can prevent accidents. Consider whether work can be done without having to drive. If they must drive, make sure their schedules are such that they can obey speed limits to complete the tasks.

 

5) Offer some leeway. Allow drivers to talk with their supervisors to adjust their driving hours if they have problems with night vision, for example, or if they are too tired or uncomfortable driving in bad weather.

 

6) Base driving on their actual ability. Conduct periodic assessments of drivers to determine their proficiency, and restrict driving based on them.

 

7) Inform. Older workers who take a variety of medications may be unaware of the effects they can have. Offer information about the potential effects of prescription and over-the-counter medications on driving.

 

 

Conclusion

 

Preventable motor vehicle crashes take an unnecessary human and financial toll on businesses every day. By focusing on the reasons and taking steps to alleviate them, payers can keep their workers safe and on the job.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

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