Know Two Types of Functional Capacity Evaluations (FCE)

Know Two Types of Functional Capacity Evaluations (FCE)When a physician is treating an employee for a back injury or other job related injury, the decision on when to return the injured employee to work is often a subjective decision. The physician who is unsure of the employees physical capability will often turn to the physical therapist for an objective opinion of the employees ability for work. The physical therapist will provide a Functional Capacity Evaluation (FCE) by administering various tests to determine the employee’s functional capacities and limitations.

 

 

Comprehensive Examination and Evaluation

 

The FCE is a comprehensive examination and evaluation by the physical therapist that objectively measures the employees level of functioning. The testing will document the employees ability, or the lack of ability, to perform the essential job related task over a specific time frame. The FCE will provide objective information to the physician in several areas:

 

  1. the employee’s functional abilities and job demands
  2. the disability evaluation
  3. when to return the employee to work
  4. whether or not the employee can return to the job held prior to the injury
  5. the employee’s functional abilities away from the job
  6. to information to design a rehabilitation plan, if needed
  7. the need for other medical intervention and/or treatment

 

While most workers compensation adjusters and employers will look at a FCE as a way of proving the employee is able to return to work, it serves a much greater function.   The results of the FCE will often limit the disability rating of the employee, preventing the physician from assigning a higher disability rating than is justified. Furthermore, the FCE will determine physical limitations the employer will need to know to modify the employee’s job, preventing a needless re-injury of the same body part.

 

 

Job Specific & General Purpose FCE

 

There are two types of FCE, the Job Specific FCE, and the General Purpose FCE. The Job Specific FCE measures the employee’s ability to perform the task and physical demands of a specific job. It can be performed at the physical therapist’s clinic, but the physical therapists can go with the employee to the actual job site and evaluate the employee’s ability to do the essential task of the employee’s job. The job-specific FCE will determine if the employee can safely do his prior job or if modifications of the required work are needed.

 

The General Purpose FCE is normally used when there is no longer a job for the employee to return to or when the job functions have not been determined. The General Purpose FCE consists of a group of standardized test and measurements that can be used to establish the employee’s overall physical capabilities. The results of the General Purpose FCE can be used to evaluate the employee’s ability to perform specific jobs that may come available to the employee.

 

 

Determine Medical Status of Employee 

 

Prior to starting the FCE, the physical therapist will review the medical records of the employee to determine the medical status of the employee. The physical therapist will establish a baseline for the employee based on the known job demands. The job demands of the employee will be characterized per the US Department of Labor’s “Selected Characteristics of Occupations as Defined in the Revised Dictionary of Occupational Titles” as:

 

  1. sedentary – exerting up to 10 pounds of force occasionally,
  2. light – exerting up to 20 pounds of force occasionally or up to 10 pounds of force frequently
  3. medium – exerting 20 to 50 pounds of force occasionally or 10 to 25 pound of force frequently
  4. heavy – exerting 50 to 100 pounds of force occasionally or 25 to 50 pounds of force frequently
  5. very heavy – exerting in excess of 100 pounds of force occasionally or in excess of 50 pounds of force frequently or in excess of 20 pounds of force constantly

 

Both the Job Specific FCE and the General Purpose FCE measure the employee’s ability to perform various motions, movements, and skills. The ability to do the accomplish the physical demands of the job will be measured in these areas:

 

  1. Balancing           Carrying                  Climbing                 Crawling
  2. Crouching          Far vision                Feeling                   Finger dexterity
  3. Fingering           Handling                 Hearing                   Kneeling
  4. Lifting                Manual dexterity   Motor coordination Near vision
  5. Pulling               Pushing                  Reaching                Sitting
  6. Standing            Stooping                 Talking                    Walking

 

Again, using the US Department of Labor guidelines, the employee’s tolerance level during an eight hour work day for the above activities is categorized as:

 

  1. Not Present (Never) – The activity does not exist in the job (example: Crawling could be classified as Not Present in the job)
  2. Occasionally – The activity exists less than 1/3 of the time (example: Climbing – occasionally)
  3. Frequently – The activity exists from 1/3 to 2/3 of the time (example: Carrying – frequently)
  4. Constantly – The activity exists 2/3 or more of the time (example: Walking – constantly)

 

Document Evaluation Results 

 

When performing the FCE, the physical therapist is responsible for ensuring the test are appropriate for the employee and the test can be done safely. The physical therapist will review the musculoskeletal condition of the employee as reported by the treating physician.   The physical therapist will screen the employee for any underlying medical pathology that would limit or prohibit the employee from participating in the FCE.

 

Upon completion of the FCE, the physical therapist will document the evaluation results. The FCE report will confirm the employee can return to work without job modifications or will confirm the employee can return to work with specific job modifications, or the need to delay the employee’s return to work.   The FCE may also address the need for work hardening or other interventions that would improve the employee’s physical abilities. Properly utilized, a FCE can provide the treating physician with the necessary information to return the employee back to work.

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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.

 

 

 

Seven Sections of Documentation For A Properly Organized Workers’ Comp Claim File

Seven Sections of Documentation For A Properly Organized Workers' Comp Claim FileThe workers’ compensation claim file should have Seven Sections of documentation that relates to the claim in a properly organized manner.

 

 

1- Claim Investigation:

 

The claim investigation section of the file should contain the adjusters claim file notes on everything that has occurred during the entire course of the claim. This includes a summary of each telephone call and a summary of all medical reports, state forms, letters, attorney reports, etc.

 

The claim investigation section should also contain either the transcript of the employees recorded statement or the claim file notes should contain a detailed review of the employees recorded statement. If a recorded statement was not obtained, the details of the employee’s initial interview should be summarized in the claim file notes. The claim investigation section should also include the employer’s supervisors recorded statement or a detailed review of the supervisor’s version of the accident.

 

A copy of the Employers First Report of Injury should be included in the claim investigation section for a comparison of the claimants version of the accident with the insured’s version of the accident.

 

When there is the potential for subrogation, for example – injuries involving an automobile accident or injuries involving a machine malfunction, documentation to support the subrogation should be included in the file investigation. This can include anything from a police report to a mechanical engineers evaluation of the machine that malfunctioned.

 

If there is a question of compensability or subrogation, the claim investigation section of the claim file should also include the recorded statement of witnesses or others who have detailed knowledge of the accident or occurrence.

 

If the claim lingers and there is a question of malingering by the employee, the claim investigation section will also contain the surveillance reports on the employee.

 

 

2- Medical Documentation:

 

The medical documentation section of the claim file should be divided into two categories, medical bills, and medical reports. Each of these two areas should be further divided into medical providers, with all medical bills by each medical provider grouped by date of service, and all medical reports by each medical provider grouped by the date of service.

 

Miscellaneous medical documentation – ambulance bills, prescriptions, durable medical equipment, etc., should be grouped by the category and organized chronologically.

 

 

3- Indemnity Documentation:

 

The employer’s wage statement reflecting the total compensation (over the state determined pre-injury period for benefits calculations) should be clearly identified in the claim file. Attached to the wage statement should be the calculations used to determine the temporary total disability benefit. If the disability benefit rate for permanent partial disability or permanent total disability is different from the disability rate for temporary total disability, the calculations used to determine the permanent partial disability or the permanent total disability rate should be shown.

 

Any documentation submitted by the employee to claim a higher rate of indemnity benefits should also be included in this section. This could include W-2 forms, copies of previous bonus checks or commission checks, etc.

 

 

4- State Forms:

 

A copy of every form submitted to the state by the employer, the employee or the insurance company should be included in this section of the claim file. State forms can be organized either numerically by the state form number, alphabetically by the state form name or chronologically by the date the state form was submitted to the workers’ compensation commission/bureau/agency/department, etc.

 

 

5- Hearings & Legal:

 

If any party requests a hearing, trial or other legal determination of benefits, this section would contain the documentation of the legal proceeding. This can include petitions for benefits, request for hearings, discovery documents and transcripts of depositions or transcripts of hearings.

 

This section of the claim file should also contain all correspondence between the work comp adjuster and the employee’s attorney, all correspondence between the work comp adjuster and the defense attorney, and all correspondence between the employee’s attorney and the defense attorney. If outside experts have been brought into the claim, the correspondence between the outside experts and any other party would be included in this section of the claim file.

 

 

6- Medical Management:

 

The medical management section of the claim file should include all correspondence and communications between the triage nurse and any other party. It should all obtain all reports, correspondence and communications between a nurse case manager assigned to assist the employee and any other party.

 

 

7- Vocational Rehabilitation:

 

The vocational rehabilitation section of the claim file will contain all the reports and activities of the vocational counselor assigned to the employee. This can include a broad range of information from vocational testing results, to available jobs in the community, to vocational retraining of the employee.

 

 

Summary:

 

The properly organized workers’ compensation claim file will prevent mistakes in the claim handling. It will also reduce the amount of time the adjuster works on the claim file by eliminating time spent searching for specific information. When the claim file is complete and well organized, everyone – employee, employer and insurer – benefit by having all aspects of the claim handled and concluded timely and properly.

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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.

 

 

 

3 Questions to Eliminate Return to Work Disincentives

You have implemented a corporate return-to-work program, but your projected workers’ compensation savings haven’t yet materialized. Supervisors are telling you they can’t get employees back to work, and even if they could they don’t WANT them to return to work. We’ve all heard it.

It may be time to examine the impact of collateral resources, often resulting in employees out on workers compensation receiving more income and benefits than they would have if they were working.

 

 

Common Disincentives to Returning to Work:

 

  1. Salary and Wage Continuation: Some companies pay 100% of salary in lieu of having an employee collect workers compensation for injuries of short duration.

 

  1. Occupational Injury Pay Supplements: Many firms pay supplemental benefits to make up the difference between workers compensation benefits and regular earnings.

 

  1. Open-Ended Job Return: Instead of holding jobs open indefinitely, employers should hold jobs open for a specific time period, such as six or nine months.

 

  1. Vacation and Sick Time: Companies frequently allow vacation and sick time to accrue for employees on workers compensation. Some even allow employees to “borrow” more sick time if they need to stay out of work longer.

 

  1. Short-Term Disability: In some companies, disabled employees receive STD benefits in lieu of salary after six weeks. But the standard definition for disability may differ from workers comp, allowing an employee to collect both.

 

  1. Perk Continuation: Employers often maintain ancillary benefits and privileges such as car allowances, club and professional dues, company store privileges and periodical subscriptions for employees on disability.

 

  1. Loan Protection Policies: Individual insurance policies are available to pay mortgages and consumer loans such as car loans and credit card debts in the case of a disability.

 

  1. Unemployment Compensation: In a few states, an employee receiving workers comp also can qualify for state unemployment benefits.

 

  1. Pension and Retirement Plans: If these plans do not allow for the offset of workers comp benefits, an employee can receive workers compensation benefits and a full pension.

 

  1. Product Liability Actions: An employee can file an action against the manufacturer of a product that injured him to collect damages. The employer should seek reimbursement for workers comp payment from any such settlement.

 

 

3 Questions to Eliminate Return to Work Disincentives:

 

  1. What Benefits are Injured Workers Getting By Not Working?

 

Many companies fail to look closely enough at their internal wage and benefits structure before embarking on programs to reduce workers compensation costs. There are numerous collateral income benefits and sources providing built-in disincentives to remaining injury-free or returning to work as soon as possible.

 

For example, a major newspaper was considering an expensive incentive program to motivate employees to return to work, but a careful examination of the company’s situation revealed the reason employees were not returning to work was because they earned the equivalent of 115% of their pre-injury earnings when the stayed out of work.

 

In another case, an injured construction company employee received long-term disability (LTD) payments after 26 weeks of disability, in addition to workers compensation benefits. The total of these benefits exceeded his pre-injury earnings.

 

And, his childcare and commuting expenses also were greatly reduced while he was home.

 

 

  1. Examine Extra Insurance Your Employee May Have

 

If an employee has purchased credit disability insurance, he or she may have eliminated house and car payments while being unable to work.

 

As such, he refused his employer’s offer of a transitional duty job at full salary because his LTD and credit disability policies would have terminated the benefits.

 

 

  1. Get your Departments to Work Together to Design WC Policies.

 

In a large company, the directors of human resources, industrial relations, workers comp and employee benefits and compensation must all be involved in designing, administering and maintaining policies. Incentives to remain at and return to work must be built into the management systems. Disincentives must be removed from all direct and indirect sources.

 

Substantial savings can be achieved when a company coordinates its salary, benefits and compensation programs, so employees don’t earn more by staying out of work. If not properly coordinated, a company’s employee benefit and compensation programs may inadvertently serve to extend workers compensation absences.

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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 Reasons A Workers’ Comp Claim Should NOT Be Closed

7 Reasons A Workers' Comp Claim Should NOT Be ClosedA few years ago a large national third party administrator (TPA) got into a lot of trouble when a Fortune 500 client noticed some major irregularities in the closing and re-opening of claim files. The client noticed that an abnormal number of claims that were closed were being re-opened by the TPA. The risk manager of the client decided to find out why.

 

 

Salary Bonus Program Based on Closed Claims

 

The TPA had instituted a salary bonus program where adjusters who met different performance criteria received a small monthly bonus. One of the performance criteria was to close as many old claims each month as new claims received. The purpose of this particular performance criteria was to move files to closure as quickly as reasonable. What the adjusters figured out was a way to circumvent the intent of the performance measurement in order to make their numbers look good.

 

In the last week of each month, the adjusters who had not closed as many old claims as new claims received would select files that had little current activity and close them in the computer system.

 

 

Adjusters Game The System

 

The following week in the new month, the adjusters would re-open the claim files and continue to handle them. Obviously, this was not the proper way to handle file closings.

 

 

Only Close Claims When All Known Activity Is Completed

 

A workers’ compensation claim should not be closed for any reason other than when all known activity to be completed on the file has been completed. If any of the following situations exist on a work comp claim, it should be left open:

 

  1. the employee has not completed all medical treatment
  2. the temporary total disability indemnity has been paid and concluded, but the employee is continuing to treat with the medical provider
  3. the employee has completed the medical treatment, but all medical bills have not been paid yet
  4. the employee has temporary total disability benefits that have not been paid
  5. the employee has completed all medical treatment, and all medical bills have been paid, but the employee is still receiving weekly or bi-weekly payments for permanent partial disability or permanent total disability
  6. the widow(er) is still receiving weekly, bi-weekly or monthly death benefits
  7. the medical bills have all been paid, all indemnity benefits have been paid, but there are still outstanding bills on the claim for the defense attorney, nurse case manager or other provider of service.

 

If there is a possibility that another dollar can be spent on the claim, the file should not be closed.

 

During a recent claim file audit, the worker’s compensation claims manager wanted to argue whether or not claims with all indemnity benefits paid, but with on-going medical maintenance treatment should be classified as open or closed. The claims manager had several old-dog files where the employees had permanent medical problems and occasionally went to the doctor. In several of the old-dog claims, the employee was making a once a year visit to the doctor. The claims manager had closed the files and was making payments on the closed files each year. This was another situation where the manager’s performance was being evaluated based on the number of files closed.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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 Your TPA May Be Underpaying Your Company Workers’ Comp Payments

7 Ways Your TPA May Be Underpaying Your Company Workers Comp PaymentsIf you ask any workers’ compensation adjuster how to calculate the amount of the temporary total disability check for an injured employee who is unable to return to work, you will get a quick answer like “it is two-thirds of their average weekly wage.” {While all states do not use two-thirds of the average weekly wage, for this blog, we will}    In most cases, the adjuster will be correct, but in a small percentage of the disability checks, the employee is underpaid.

 

The component of what constitutes “wages” is an area of workers’ compensation that has almost as many variations as there are states. While the adjuster normally includes vacation pay and holiday pay in the indemnity calculations, many other types of compensation get overlooked.

 

Buried deep in the work comp statutes, or in some cases, court decisions, is a definition of what constitutes wages. For the employee who is paid $15 per hour, and never works anything but a 40 hour week, the adjuster’s calculation of a weekly disability benefit of $400 ($15 x 40 x 2/3) is correct if none of the following exceptions come into play.

 

 

1. A Second Job:

 

In about half of the states, if the employee is working a second job for another employer, the employee is entitled to two-thirds of the income lost from the other job. Let’s say the above employee is making $15 an hour from your company and works from 8:00 a.m to 4:30 p.m for your company. When the employee get’s off work, he goes down the street and starts his part-time janitorial job that is from 5:00 p.m to 9:00 p.m where he earns $12 per hour. Due to his part-time job, the adjuster will need to add another $160 ($12 x 20 x 2/3) to the weekly indemnity check. This hypothetical employee would get an indemnity check of $560 ($400 + $160) per week, assuming that the $560 per week is below the state cap for weekly indemnity checks.   [I know it doesn’t seem right that your work comp coverage is paying for lost income from work at another employer, but that’s the law in many states].

 

 

2. Training Pay:

 

Closely kin to the second job compensation is training pay. If the hypothetical employee above did not have a second job but was attending a night class where he was being paid by your company $75 per week to attend, in some states the lost income is owed if he could no longer attend the class due to his on-the-job injury. The adjuster would need to add $50 ($75 x 2/3) to his week check. If the nightly class had only 4 more weeks to run, then after the fourth week, the adjuster could remove the extra $50 per week from the indemnity check.

 

 

3. Freebies:

 

An area of compensation that a lot of adjusters miss (and for that matter, attorneys representing the injured employee) is the value of freebies. If the employer routinely provides free meals or free housing as part of the compensation (think migrant farm worker in a state where migrant farm workers are covered for workers’ comp), and the employer no longer provides the free meals or free housing after the injury, the value of the freebies has to be added to the calculation of the weekly indemnity check.

 

 

4. Commissions:

 

The calculation of the weekly indemnity check for the salesperson would seem to be easy like the calculation of hourly workers indemnity check – two-thirds of the average income over the period of time used to calculate the weekly check. This works if the salesperson income is steady, but not with the new salesperson whose income is steadily increasing each week or month. In most states that is too bad for the salesperson with no projection of future earnings being allowed. However, a few states will allow “equitable estimation,” and the work comp boards will award it.

 

Another area of disputes with salespersons on how much their indemnity check should occur when the salesperson earns additional commissions or overrides. If the salesperson who sells over and above X number of units per year gets an additional percentage of commission for exceeding the goal but will come up short of the goal due to an on-the-job injury, does the adjuster still owe an indemnity payment on the additional percentage? It varies tremendously from state to state. It will normally take some research on the part of the adjuster to answer that question. The same issues apply when the salesperson receives overrides from recruiting additional salespeople but is unable to recruit due to the on-the-job injury.

 

 

5. Bonuses:

 

Bonuses are another area where the employee often gets shortchanged on the indemnity check. For instance, let’s say the employee works in a state where only the previous 13 weeks of income (some states use 26 weeks of income, other states use 1 year’s income) is used to calculate the average weekly wage. The employee gets hurt on November 1st, and is still off work at the end of the year when the employer passes out the year-end bonuses. If the employer does not have the employee on the payroll, and the employee does not receive the bonus, the work comp adjuster would owe two-thirds of the bonus amount. This is only if the sole reason the employee did not receive the bonus is that the employee was not working due to the injury at the time the bonuses were passed out.

 

 

6. Tips & Gratuities:

 

One area where the employees often receive less money than what they should receive on the indemnity checks is the employees who earn tips and gratuities in addition to their base pay. When the employee is injured, the employer reports the income amount that is on the employer’s record. When the adjuster tells the employee what the amount of their indemnity check will be, they often hear from the employee “that’s not right, that does not include the tips that I did not report”.   When the waiter, bell-hop or taxicab driver tells the adjuster they cheat the government out of tax revenue by under-reporting their income; there is nothing the adjuster can do about it. [What the adjuster is thinking but won’t say – ‘if you are willing to cheat Uncle Sam on your income tax, you are probably willing to cheat the insurance company on your work comp claim’].

 

 

7. Benefits:

 

In some states, the employer is allowed to discontinue contributions to 401k plans, health insurance, and other benefits when the employee is off work for an extended period of time. If the employee has to pick up the tab for the health insurance or other benefits, some states require the work comp adjuster to consider the value of the lost benefits in the calculation of the weekly indemnity check amount.

 

 

Summary:

 

The calculation of the indemnity check depends on what the state statutes require. Both the employer and the workers’ compensation adjuster need to know the lesser known points of what is considered a part of the employee’s compensation in their own state.

 

CHECK YOUR STATE LAW!

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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.

 

Top 8 Considerations When Selecting Your Workers’ Comp Claims Adjuster

Top 8 Considerations When Selecting Your Workers' Comp Claims Adjuster

If you are the risk manager or workers’ compensation claims coordinator for a large company where you report new work comp claims on a regular basis, you need to select your adjuster. Whether your workers’ compensation claims are handled by the insurance company or a third-party administrator (TPA), your claims handling agreement should specify that your company has the right to select, from their staff, the adjuster(s), who will handle your claims. If the insurance company or TPA balks at your company having input into who handles your claims, it is time to get another insurance company or another TPA.

 

Someone in your company must have an in-depth knowledge of the adjuster handling your claims – NOT just the adjuster’s name and phone number. If you want to maximize the effectiveness of your adjuster, you need to know the adjuster’s claim handling style. You also need to know when to step in if the adjuster is not achieving your expected results.

 

 

#1- Dedicated or Designated 

 

If you have multiple workers’ comp adjusters in the same claims office handling your claims – ASK — “How many of our claims are you handling?”

 

The problem with having multiple adjusters in the same office each handling only a few claims for your company is:

  1. They do not know what your preferences are.
  2. They do not know your return-to-work program.
  3. And, they do not know the claim handling philosophy of your company.

Depending upon the jurisdiction and the statutes involved, the experienced workers’ comp adjuster can handle from 125 to 150 claims at a time. If you have less than 125 claims in the claims office, it would be in your company’s best interest to have only one adjuster, a designated or dedicated adjuster, working on your claims.

 

A “designated” adjuster handles all your claims plus claims for other employers. On the other hand, a “dedicated” adjuster handles only claims for your company. If, for example, you have 280 open workers’ comp claims in the same claims office, you want two dedicated adjusters who working exclusively on your claims.

 

If your insurance company or TPA is using multiple adjusters on your claims, you need to have a serious chat with them about having a designated adjuster or dedicated adjuster(s) for your program.

 

 

#2- Adjuster Experience – Why It Is Important 

 

The level of experience and training the adjuster(s) bring to your program makes a major difference in the outcome of your workers’ compensation claims. While every adjuster has to go through the training stage, do you want the adjuster-trainee making mistakes on your claim files? Let the adjuster trainee learn how to handle claims on the workers’ comp files of the employers who not attuned to their workers’ comp program.

 

Request an experienced adjuster who knows:

 

  1. the statutes and case law within the jurisdiction,
  2. the plaintiff attorneys who settle fast and cheap
  3. the attorneys who drag the employees’ claims out trying to maximize them,
  4. the medical providers and their treatment style
  5. the medical providers who are liberal with their permanency ratings and the medical providers who are conservative
  6. the best defense attorneys, and
  7. the tendencies of the industrial commission/workers’ comp board/court

 

 

#3- Investigator or Record Taker 

 

You do not want the experienced dedicated adjuster who is a record taker. A “record taker” copies what is on the Employer’s First Report of Work Injury form to obtain the description of the accident that injured the employee.

 

An “investigator” reads the Employer’s First Report then contacts the employer’s workers’ comp coordinator, the employee’s supervisor, the employee, and any witnesses to the accident. The investigator obtains detailed information from each party about how the accident occurred before accepting compensability.

 

The investigator does not stop being quizzical when compensability is accepted. The investigator reads every medical report thoroughly to have a complete understanding of the medical status and medical issues. The investigator then uses that knowledge to move the claim toward resolution. The record taker just makes a note of what the medical report stated.

 

 

#4- Combatant or Complacent 

 

When the employee’s attorney makes an unreasonable demand, you want an adjuster who will stand up and say NO. Your company does not need an adjuster who takes the easy way out and accepts whatever the employee or the employee’s attorney wants. Your adjuster should not always be in a combatant mode but should know when to take a stand on statutes, principles, or common sense. The complacent adjuster who does not stand up for the employer’s rights will cost your company a lot of money. When selecting your adjuster ask questions about how aggressive the adjuster will be in defending your workers’ comp claim.

 

 

#5- Up to Date or Behind the Times 

 

The workers’ comp statutes and the case law in every jurisdiction are constantly being challenged and changing. The adjuster (and the adjuster’s company) you select for your workers’ comp program should be staying current on all legislative changes and recent case law. When selecting your adjuster, ask what sources the adjuster uses to know about changes in the workers’ comp statutes. The best adjusters have several sources of new information including defense firm newsletters, workers’ comp websites (like this one), and workers’ comp groups on LinkedIn and other social networks.

 

The adjusters for your company’s workers’ comp claims should be current in their state required continuing education courses. It is also a good sign if the adjuster has obtained their AIC, ARM, AIM or CPCU designation, as it shows the adjuster has continued to learn and improve his/her skill set.

 

 

#6- Supervised or Unsupervised 

 

As a part of your claims handling agreement with your insurance company or TPA, you need access to their on-line claim file notes. While you expect to see your adjuster notes frequently,  how often do you see the supervisor’s file notes? Does the adjuster’s supervisor offer suggestions or recommendations on your claims, or, do you never see a file note by the supervisor? Even if you have the claims office’s best adjuster, every adjuster can benefit from a second set of eyes on the file. The supervisor should be reviewing the file and making comments on the progress of the file every 60 to 90 days. If not, you need to get the supervisor involved.

 

 

#7- Historian or All in Adjuster’s Head 

 

A good adjuster is a historian, meaning everything the adjuster has done on the claim file is documented completely in the file notes. If your adjuster is on vacation or off work sick, you should be able to read the files notes on any of your workers’ comp claims and know exactly where the claims stand. If the adjuster does not keep good files notes, but has it “all in his head,” what happens if the adjuster quits, transfers, gets promoted, or dies? The next adjuster will spend considerable time not working on your claims, but recreating what should already be noted in the file. When you are selecting your adjuster, be sure to state your expectation that activities on the file are to be documented in the file notes.

 

 

#8- Results 

 

Once you have experienced dedicated adjuster(s) working on your workers’ comp claims, don’t stop there. You must benchmark your results each year to verify that the adjuster(s) working on your claims are exceeding the benchmarks for your industry. If your adjuster’s results are not adequate, do not hesitate about asking your insurance company or TPA for the selection of another adjuster(s) for your workers’ comp program.

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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 Four Phases of Employer Involvement In A Workers’ Comp Claim

The Four Phases of Employer Involvement In A Workers’ Comp Claim

As an employer, you often hear the recommendation “stay involved in your workers’ compensation claims.” That is great advice, but way too often it’s where the discussion ends without any explanation as to what “staying involved” means.

 

 

Four Phases of Employer Involvement in Workers’ Comp Claim

 


The employer’s involvement in the workers’ comp claim begins before the injury occurs and ends when the employee is back at work, fully recovered from the injury. Let’s first look at four phases of employer’s involvement in the workers’ comp claim, then we will look at what the employer cannot do in regards to the workers’ comp claims.

 

The four phases are:

 

  1. Pre-injury process
  2. The injury occurrence
  3. The claim process
  4. The claim settlement

 

If you have employees, sooner or later an employee is injured on the job. The following are some suggestions about what you can do prior to the injury occurring that will impact on the outcome of the workers’ comp claim. Make sure you have “touch points” for each phase of the claim.

 

Here is an example of what is appropriate:

 

  • Provide each new hire with an employee accident brochure outlining what the employee should do in case of an accidental injury.

 

  • Have a written transitional duty policy.

 

  • Provide each supervisor within the company a written guide on how they are to report and be involved in workers comp claims.

 

  • Post the injury procedure policy where all employees will see it.

 

  • Have a published returned to work policy.

 

  • Have a strong safety program and tie the manager’s performance evaluation, raise, bonus or promotion to his or her safety record.

 

  • Have a medical provider network in place through your insurance company or join a medical provider network for self-insureds. Make sure all employees know about and use the network. This is called your “penetration” — you should have a penetration rate of > than 90%.

 

  • Prevent fraud by letting all employees know workers comp fraud takes money away from their raises and bonuses.

 

  • Put up posters reminding the employee that workers comp fraud is a crime and will be fully prosecuted.

 

  • Post all the state required notices in a place convenient for all employees to see including workers comp laws, OSHA posters and anything else required in your state.

 

  • Post a list of the required medical providers (where allowed by state statute) or recommended medical facilities (in the states where the employee is allowed to select their own doctor). Consider using an outcome-based network where providers with exemplary performance are included in the network.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:.

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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 Questions the Self-Administered Company Should Ask When Hiring a Workers Compensation Adjuster

7 Questions the Self-Administered Company Should Ask When Hiring a Workers Compensation Adjuster

If you ask an adjuster candidate if s/he knows how to handle a work comp file, you will get an obvious answer like “I handled an open inventory of  approximately 125 claims at any one time during my 5 years at XYZ Company.” The answer by the adjuster candidate assumes s/he was doing the job correctly, but is that true?

 

Before you interview adjuster candidates, take time to create a fictional test claim customized to the statutes within your state, with a partial investigation completed. The purpose of a “test claim” is to test the candidates’ technical competence and real knowledge of file handling.

 

 

Include in the fictional test claim information:

 

  • facts of the accident, with the supervisor’s name and the names of witnesses
  • information on the injury (make it a burn or a fractured limb with the need for surgical repair, or another complicated injury)
  • Employer’s First Report of an Accident form for your state (with wage information but no mention of the employee’s second part-time job)
  • have facts (like horseplay or intoxication) that create questions regarding compensability
  • have facts (like sub-contractor or seasonal worker) that create questions regarding coverage,
  • employee treating at an unapproved medical provider

 

 

Following a review of the fictional claim by the candidate, ask the person:

 

  • opinion as to coverage for the claim
  • opinion as to compensability for the claim,
  • to outline the investigation steps to take (interview the employee, the supervisor, and witnesses? contact the medical provider?)
  • provide a reserve calculation sheet showing how reserves will be set for the claim,
  • show his/her calculations of the average weekly wage
  • list the state forms needing to be filed, and when
  • handle the medical treatment at the unapproved medical provider

 

 

In your review of the adjuster candidate’s answers to the questions on the “test claim” determine if s/he missed any key points like coverage and compensability. Verify the investigative steps are correct, that s/he know how to establish the average weekly wage properly and to set reserves. Be sure the appropriate state forms would be filed and s/he knows and understands all state-specific statutes. [If you are unsure as to the quality of the adjuster’s answers your claims manager or defense attorney can review the answers].

 

 

PERSONAL CHARACTERISTICS

 

The personal characteristics of the workers’ comp adjuster candidate are very important. Being a workers’ comp adjuster is not easy. It takes a person with many personal characteristics beyond the job skills.

 

 

Personal characteristics include:

 

  • Self-stress management as the workers’ comp adjuster position can involve difficult people, deadlines, conflicting demands, pressure from both outside and inside the organization, and frequent change.
  • Reasoning to understand relationships between facts, information from various sources and to data.
  • Creative thinking as the facts and issues vary from one claim to the next.
  • Problem-solving ability to analyze the facts and use proper reasoning to solve the problem when confronted with both relevant and irrelevant facts.
  • Oral communication ability to obtain information from various sources and to convey information in a clear and precise manner.
  • Written communication skills to convey information in a well-organized manner
  • Interpersonal skills to deal with people who are injured, difficult, or even hostile.
  • Self-motivation to set personal goals and to take the initiative to accomplish personal objectives and company goals.
  • Honesty and integrity in all aspects of her interactions with everyone.
  • People skills including tactfulness, empathy, understanding, and concern.
  • Planning ability to set priorities, organize work, to achieve short-term and long-term goals.
  • Customer service skills to maintain rapport with employers and provide guidance and assistance to them.
  • Self-esteem to maintain a positive image of self and the company and to display it professionally.
  • Mathematical ability in establishing indemnity benefits and reserves.
  • Conscientious about the details of the work.
  • Plays well with others and encourage cooperation, commitment, and company loyalty.

 

If you are unsure how to measure or evaluate the personal characteristics of the adjuster job candidate, there are various personality testing services and forms available.

 

The list of technical job skills and personal characteristics could be extended several more pages for the selection of the best adjuster candidate for your self-administered claims program. The skills and characteristics outlined here will assist you in weeding out unqualified or inappropriate adjuster job candidates. While testing of the technical competency and personal characteristics of the adjuster candidates takes more time and expense, it is well worth the investment of your goal in hiring the best-qualified adjuster.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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.

 

 

Fourteen Steps Employers Can Take to Manage Workers Compensation Claims

Fourteen Steps Employers Can Take to Manage Workers Compensation ClaimsToo many employers allow their involvement in the workers’ comp claim to end when they send the employee to the doctor. That is a huge mistake and will result in a steady increase in the amount of workers comp insurance premiums. The employer needs to have an established post injury process. It should include:

 

  • Report the claim to the insurer, third-party administrator or self-insured claims office immediately. The supervisor or your workers’ comp claims coordinator should be reporting the claim to the claims office while the employee is still en route to the medical provider.

 

  • 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 will be unable to return to work within the waiting period, provide the claims office with necessary wage information for the calculation of indemnity benefits.

 

  • Advise the claims office of the claimant’s prior history of workers comp claims. The adjuster’s approach to the claim varies significantly between the employee who never had a previous workers comp claim and the employee who has had 15 workers comp claims in the last ten years.

 

  • Review your transitional duty program and find a job the employee can do within the treating physician’s restrictions.

 

  • 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 as required.

 

  • 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 will get ugly when employees think it is time to stick it to the employer.

 

  • Maintain an open dialogue – call the employee at home to show your concern and to offer assistance in processing the workers’ comp 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.

 

  • If you are contacted by an attorney representing the employee, notify the claims adjuster immediately.

 

  • Immediately dispute any invalid or fraudulent claim.

 

  • If the employee has a questionable claim or a subjective claim for neck or back injuries, and immediately goes to the television advertising workers comp attorney, or a plaintiff’s attorney-oriented doctor known for excessive disability ratings, advise the employee immediately that you intend to fight the claim as the attorney and/or doctor has a history of inflated claims.

 

  • Monitor the state filings by the adjuster and any other claim related paperwork.

 

  • 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. The board will learn YOU are an employer who takes part actively.

 

  • 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.

 

  • Always advise the adjuster when the employee returns work – the same day.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%.

 

Contact: RShafer@ReduceYourWorkersComp.com.

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

 

©2018 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.

 

 

 

September 11th Remembered – Tribute To Marsh And AON

Article republished from a previous post.

 

Everyone remembers where they were the when they learned the World Trade Center crumbled to the ground. I was scooping ice cream at the Mansfield Center General Store. Having recently retired from the risk management and insurance industry, I had moved back to the area, built a house in Mansfield Center and worked from my home office. I was helping my family restore and run the General Store.

 

I had an exciting career in risk management and insurance working for two of the best insurance brokers in the industry. BOTH companies had sizeable offices located in the World Trade Center. So, when Bill called and asked me if I was watching TV, did I know a plane flew into the World Trade Center, I was alarmed. Initially I thought he meant it was a small plane, but when I turned on the TV, I could see it was a huge plane and the building was on fire. And then another plane had flown into the other tower.

 

 

We Never Knew How 9/11 Could Affect An Entire Industry

 

Everyone in the risk management field “plans”… we plan for every eventuality, thinking things through. That’s what we do. We help our clients, which are large companies such as The New York Times, Universal Orlando, and USAir, etc. plan how to provide safer workplaces, safer products and safer environments. But we never planned for Sept 11. We never knew how it could affect an entire industry.

 

AON and Marsh are the two largest insurance brokers in the world and I – with a loyal team of consultants – was responsible for development of the workers’ compensation practices at those companies. Workers’ comp insurance is the largest line of insurance coverage – a huge cost to most employers – and I had found the solution to reduce those costs significantly. Helping a wide-variety of types of organizations was gratifying, and there was a new challenge every day. I had written, published, traveled, and worked hard for 25 years, so I looked forward to scaling back.

 

When a retirement opportunity presented itself, I left the workforce to enjoy being a mom. My daughter was 17 and Glastonbury High School had not gone well. Against her will, we had moved her to a private school, and she and I were getting reacquainted during the long drive to and from school in Farmington, CT. Life was good.

 

 

Many Former Employees Went Back To Work

 

It wasn’t part of the plan to go back to work, but two weeks after Sept 11, I went back to AON, filling in for Lisa Ehrlich. Lisa was an outsourced risk manager who worked on-site at a company in Stamford, CT. On 9/11, she had gone into the NY office for a meeting and was killed that day. I was honored to be able to help in some small way. Many former employees went back to work in the intervening years to help the brokers rebuilt their practices. Here is a remembrance of my colleagues.

 

In the 15 years since Sept 11, a new generation has taken over. Some hardly know our industry lost so many that day, key leaders and pioneers in the field of workers’ compensation cost containment. In the intervening years, my niece and nephew, Kori and Michael Stack, have taken over a leadership role in my company and become industry leaders in their own right. I am very proud of them for carrying on the legacy and memory of our beloved colleagues lost on that fateful day.

 

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com.

 

©2016 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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