Use These 16 Tips To Plug Work Comp Claim Leakage

The failure by the self insured’s third party administrator (TPA) or in-house staff adjusters to comply with workers’ compensation claim handling Best Practices normally results in higher than necessary claim cost.  Just like in any other business, the failure to manage the cost of doing business – known as leakage – places the self-insured employer at a disadvantage in the market place.  To recover the excess cost of poor claims handling, the company must raise the amount they charge for their products or services to cover the additional cost.

 

Leakage in an insurance claim is any payment on the claim that is more than it should be.  Leakage is normally defined as the difference between what the claims adjuster spent and the amount he/she should have spent.   Leakage has also been defined as the lost opportunity to save money on the claim.  In essence, leakage is excess and unnecessary claim costs.

 

 

16 Tips To Plug Work Comp Claim Leakage

 

There are about as many different types of leakage in workers’ compensation claims handling as there are workers’ compensation subjects to be discussed.  Some common examples of the claims’ handling errors that cause leakage in workers’ compensation include:

 

  1. A failure to properly investigate compensability resulting in paying claims that should be denied.
  2. A failure to timely get a claimant to Maximum Medical Improvement (MMI) leads to leakage because at the point of MMI a claim should be settled.  The failure to do so leads to increased indemnity benefit payments to the claimant.
  3. A failure to adjust medical bills higher than the medical fee schedule down to the medical fee schedule amount.
  4. A failure to utilize the employer’s return to work program leads to excess indemnity benefit payments to the claimant.
  5. An improper denial of a claim leads to the claimant obtaining a lawyer which drives up the cost of a claim.
  6. A failure to properly investigate and tie down the scope of a claimant’s injuries leads to increased claim costs because the claimant can add non-compensable injuries which drive up the cost of the claim.
  7. A failure to run an ISO report or obtain medical records from prior injuries or pre-existing conditions can lead to excess claim costs being incurred for treating injuries which are not part of the claim.
  8. A failure to establish the proper average weekly wage results in miscalculation of the temporary total disability (TTD) indemnity benefits to be paid the claimant, often with a corresponding overpayment of TTD.
  9. A failure to determine that the injury claim was caused by a third-party which results in the cost of the claim not being recovery from the responsible party (loss of subrogation rights).
  10. A failure to select the most qualified defense counsel.
  11. A failure to timely pay medical bills or indemnity benefits results in fines and/or penalties.
  12. A failure to properly manage utilization review opportunities
  13. A failure to control the selection of the medical providers in those states where the employer selects the medical provider results in increased claim cost because the claimant and/or his/her attorney is free to choose a “claimant friendly” medical provider.
  14. A failure to provide a nurse case manager on complex injury claims leads to higher and/or unnecessary medical costs because there is no professional oversight of medical costs.
  15. A failure to read a claimant’s medical reports results in errors including payment for unrelated medical care, providing unnecessary medical care, unnecessary time off work, and various other claim handling mistakes.
  16. A failure to maintain adequate payment records results in duplicate payment of bills

 

 

Independent Claim Auditor Advantageous

 

When the self-insured employer sees the cost of their claims increasing greater than normal, the employer can do a detailed review and analysis of each claim.  However, most self-insured employers find it advantageous to hire an independent claim file auditor to review the work comp files for compliance with Best Practices.

 

The claim file auditor will analyzed the claim handling errors in regard to the financial impact each error had on the claim.  The claim file auditor will assist the TPA or the self-insured’s staff adjusters  to identify areas where leakage is occurring and will provide guidance on how to prevent future leakage.  Plus, when the independent auditor identifies leakage due to the failure to subrogate, or due to duplicate payments, the employer may be able to recover some of the money that has been lost.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

 

7 Types of Workers’ Comp Claims That Raise Questionable Red Flags

7 Types of Workers’ Comp Claims That Raise Questionable Red FlagsMost workers compensation claims are legitimate. Unfortunately, there will be times when an employee will try to take advantage of the workers’ comp system. When an employee has a workers comp claim with the following characteristics, it is time to be extra diligent in your approach to the claim.

 

 

  1. The Monday Morning Claim

 

When an employee reports an injury within the first few minutes of being on the job on Monday morning, there is a good chance the accident did not happen within those first few minutes but over the weekend while the employee was doing household chores or participating in a sporting activity or other physical exertion. This is especially true if the employee, who does not normally come in early, gets in and gets hurt before anyone else arrives on the job.

 

 

  1. The Unwitnessed Accident

 

A disproportionate share of back injuries, neck injuries, and other musculoskeletal injuries seem to occur when no other employees are in the immediate area. Often these unwitnessed injuries occur to people who have degenerative disc disease, arthritis, or other musculoskeletal issues bothering them before the unwitnessed accident occurs.

 

If your “injured” employee works typically around other employees, and the employee is in an area where the employee normally does not work, when the unwitnessed accident occurs, an in-depth investigation will be needed.

 

 

  1. The Late Report of Injury

 

When an employee is injured on the job, unless there is some really compelling reason to not report the injury, the accident will be reported the same day it occurred or at the latest the following day. When the employee reports an “accident” that occurred last week, last month, or longer, it most likely did not occur at work.

 

 

  1. I Forgot the Details

 

When the employee tells the employer that the back injury happened to carry a box of parts, and then tells the emergency room doctor the injury occurred picking up a heavy piece of equipment, and then the lawyer claims the back injury happened while the worker was using a jackhammer, which version of the accident do you believe? If the accident version varies from medical report to medical report, most likely none of the accident versions are correct. The employee who forgets the details of the accident is most likely having workers’ comp take care of the aching back or another body part when the worker should be paying and submitting bills to the worker’s own health insurance.

 

 

  1. The Unhappy Employee

 

Workers compensation is often abused by an unhappy employee. Sometimes employees may use a workers’ comp claim to keep from being laid off following a disciplinary action or to maintain a source of income when the union calls a strike, or when the factory is closing, or at the end of seasonal employment. When an employee is disgruntled about some aspect of the job, workers comp is often seen as a paid vacation.

 

 

  1. The Cheat

 

While some of the fraudulent workers’ comp claims are to have workers’ comp pay for a real, but not work-related injury, many fraudulent claims are based solely on greed. For example: The employee is offered a temporary “under-the-table job” paying cash. Claiming workers comp indemnity benefits while working under-the-table is a good way of getting additional income while maintaining a job to go back to when the temporary work ends. Other variations of the cheat is the employee who has been working two jobs, but is ready to give the second job up. A workers’ comp claim drawing indemnity benefits from two jobs greater than what is made on only one job provides the excuse needed to make a phony claim.

 

 

 

  1. The Migrating Injury

 

The migrating injury claim is often missed by an employer or adjuster. The employee starts out with a very real, very well-documented injury such as a falling object breaking a foot bone. The employee gets acquainted with the doctor and after several visits advises the doctor there is wrist pain. The doctor starts treating the wrist for carpal tunnel syndrome. When the doctor starts treating a body part that was not injured on the day of the accident, the additional medical treatment needs to be promptly identified and denied.

 

 

Any time you feel there is something just not right about an employee’s workers comp claim, your instinct is often correct. Any time a questionable claim is reported, do not just accept it. Report it to the claims office as questionable and explain why you think so. Ask for a complete investigation and involvement of the SIU (Special Investigation Unit) in the claim. Defeating the questionable claim will have a positive impact on your workers’ compensation costs.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

5 Tips – How to Use Surveillance to Prove Workers’ Comp Fraud

There are jurisdictions where workers comp is very employee-friendly, and it seems the employee can do no wrong. In the mind of a judge, it is the employee who suffered a great loss while working for your company. They are in daily pain because of injuries suffered on the job site. They are trying to make ends meet on reduced wages.

 

 

For the most part, this is correct. But every adjuster has a few cases where there is that gut feeling that something is not right. But, if the medical adds up to supporting ongoing disability, and a nagging feeling still exists, then it is time to run surveillance. But how does it work to help in a specific case? There is no question the claimant is injured. More than 10 seconds of video of the claimant getting the mail is needed. Here are 5 ways to think about surveillance and its benefits.

 

 

 

  1. Use a Surveillance Firm that Boasts Results

 

There are many surveillance firms available. Some of them specialize in legal backgrounds in law enforcement, some with military backgrounds, and some with insurance backgrounds to name a few. Whatever the case may be, a reputable firm must be chosen.  Video evidence of the claimant doing something outside of the medical restrictions must be obtained. Showing this as repeated behavior is key.

 

 

Obtaining this kind of evidence to help the case is partially due to luck. But this is where a skilled investigator plays a huge role. Through a background search including social media and understanding the person’s habits, one can begin to theorize how and when the subject will be active.   For example, if the claimant has pictures of deer on a Facebook page, it can be reasoned the Fall season is likely an outdoor time for the worker to be active.

 

 

Feedback from peers in the specific industry and carriers is helpful. Some carriers now have their own surveillance unit, and it can be considerably less costly to use a carrier’s firm than to go outside of the network. This is a large expense. But if good video is recorded, it can save so much more in overtime cost and is a wise investment.

 

 

  1. Plan on 3-5 Days Worth of Surveillance

 

As mentioned above, the person must be shown breaking medical rules. If the claimant has restrictions of no lifting over 15 lbs and is caught at the grocery store lifting 2 bags of groceries, that is not exactly case-changing evidence. But, if the worker is lifting groceries one day, then going home and doing yard work for 2 hours, helping a neighbor the next day cut a tree down, then waxing the car a day later followed up by working with a friend to remodel a kitchen, now potential evidence is building to show a pattern. It shows the worker living a normal life with little to no medical problems.

 

 

The scenario of finding evidence is probably not going to happen on every file, but it is amazing to discover what people are doing on their spare time. Some people hole up in houses and only stick arms out to retrieve mail from the bin by the front door.  Those people may have experienced having surveillance used on them! While others are out golfing, playing softball, deer hunting, or boating with a shoulder injury to name a few scenarios. Whatever it may be, the employer needs enough video to justify the person breaking medical restrictions as often as possible. This is especially helpful when an IME supports an ongoing disability. Then after video is successfully recorded, it is sent to the IME doctor for review. And the doctor may change an opinion to show no ongoing medical disability. If there is a suspicion that a claimant is not 100% truthful with a disability, and the right video and doctor’s opinions coincide, then the adjuster’s suspicions are justified.

 

 

 

  1. Be Sure Reports Detail All Activity

 

Just the video alone can be enough to swing an opinion to deny ongoing benefits. In addition to the video, record every activity, action by action. Sometimes the events unfold before the investigator can get the camera rolling. Or the investigator cannot get a shot due to location. Investigators should still document the activities of the subject in great detail. Chances are the agency may be deposed on the case at a later date, so most reputable firms are extremely detailed in every fact and activity on the case. In these cases, it is preferred to have too much information than not enough.

 

 

 

  1. The Video Obtained Has to be Clear

 

Getting video of the claimant is very important, but it can be worthless if the claimant is out of view or the picture is fuzzy. A lot of this comes down to the investigator’s experience and the quality of the equipment the firm uses. Ask for examples of video and reports to gain an idea of how a case is handled.

 

 

 

  1. The Subject Has to be Violating their Restrictions Frequently

 

We mentioned above getting 3-5 days worth of video to show the subject breaking restrictions on multiple occasions.  There are cases of a judge viewing a video of the claimant breaking restrictions on one occasion and then turning to the subject and saying “Why were you lifting 40 lbs when your restrictions state you should only lift 20 lbs?”   The response is usually something like, “Boy I must have been having a good day that day because I could hardly lift anything at all.”

 

 

It may seem unbelievable, but depending on the jurisdiction, some judges believe it.   Show the judge the worker’s behaviors are not just a one-time thing. The person is violating restrictions on a daily basis for 4 straight days. Imagine if surveillance could be done for 30 days in a row, so much evidence of restriction violation would exist. Malingering would be simpler to prove.

 

 

And that is the goal and challenge when recording a person doing the wrong thing more than one time. It shows a pattern and makes the point the person is leading a normal, pain-free life, despite reporting otherwise to the doctor. If blatant disregard is evident through the use of video on multiple occasions, there is a great chance of getting the desired result — terminating the fraudulent claim.

 

 

Summary

 

Surveillance can be a useful tool to help confirm a claimant’s honesty. But to benefit from it fully, certain guidelines must be followed. First, a reputable firm must be used making sure the firm is descriptive and up on the latest technology. Try to obtain as much video as possible and then tie it into the case defense. Although not every person “doing fraud” will be caught, chances are those violating the medical restrictions and working second jobs under the table will be caught.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

 

 

20 Workers’ Comp Claims Handling Best Practices

20 Workers' Comp Claims Handling Best Practices

Often you see references to “Best Practices” in the handling of workers’ compensation claims without an explanation as to what they are or what the insurance industry standards are for handling work comp claims. While “Best Practices” vary slightly from insurance company to insurance company, here is a synopsis of the basic standards of how the insurance adjuster handles work comp claims.

 

  1. Coverage:

 

The very first thing a work comp adjuster does is verify the coverage by checking the policy number, policy dates, and insured name.

 

 

  1. 3 Point Contacts:

 

The adjuster makes voice contact (in person contact on severe claims) with the employer, the employee and the treating physician within 24 hours of the claim being reported to the claims office.

 

Proper contact involves an exchange of information with the employee, the employer and the doctor’s office, not just leaving a voice mail or sending a form letter. On claims of questionable compensability or with subrogation potential, a recorded statement from the employee needs to be obtained.

 

 

  1. Investigation:

 

The adjuster addresses all issues affecting coverage, compensability, subrogation, extent of injuries and benefits within 14 days of the receipt of the claim.

 

 

  1. On-going Contacts:

 

Consistent and on-going contact with the employee (or attorney), the employer and the medical providers are essential to getting the employee back to work as quickly as possible.

 

 

  1. Data records:

 

All data input is completed within 72 hours of receipt of the claim. These sample data items must be correct on every claim: loss location codes, body part codes, and description of injury codes.

 

 

  1. Reserves:

 

The initial file reserves are usually set at the completion of the 3-point contacts and within 72 hours of the claim being reported. Once the adjuster obtains the initial medical records, the reserves are reviewed for accuracy. Any subsequent medical records or other information impacting the value of the claim usually results in a reevaluation and changes in the file reserves.

 

On severe claims where the file remains open for an extended period of time, the reserves must be checked for accuracy ever 6 months.

 

 

  1. Average Weekly Wages:

 

The adjuster obtains information documenting the employee’s wages within 14 days of receipt of the claim.

 

 

  1. Compensability:

 

The basis for the acceptance or the denial of a claim is documented in the file within 14 days of receipt of the claim.

 

 

  1. Payment of Benefits:

 

The file clearly outlines how the indemnity benefits were calculated and confirm the benefits were paid on time (varies per jurisdiction).

 

 

  1. ISO Filing:

 

The index filing is completed within 14 days of receipt of the claim. (Most companies have gone to index filings on only the lost time claims). If the index filing reflects a prior claim, the work comp adjuster follows-up with the prior insurer for information on the prior claim.

 

 

  1. First Reports (Claims Handled by TPAs):

 

When claims are handled by a third-party administrator (TPA) rather than the insurer, it is standard for the TPA to provide a report to the insurer within 14 days outlining the coverage, jurisdiction, compensability, medical management, benefits, subrogation (if applicable), subsequent injury fund (if applicable), reserves, payments and action plan.

 

 

  1. Status Reports (Claims Handled by TPAs):

 

Regularly scheduled status reports updating the insurer on file developments are completed by the TPA’s work comp adjuster. Depending on the status of the claim, the status reports may be every 30 days, 60 days or 90 days, however important developments on the claim is immediately reported to the insurer.

 

 

  1. Action Plans:

 

The file contains an outline of the steps the adjuster plans to take to bring the file to a conclusion. The outline contains a date for each issue, problem or concern to be resolved.

 

 

  1. Medical Management:

 

The work comp adjuster knows the nature of the injury, the cause of the injury, the treating physician’s diagnosis, the prognosis, the treatment plan and the return-to-work status. On severe claims, the adjuster coordinates/supervises the nurse case manager’s involvement in the claim.

Where applicable, the adjuster (or the nurse case manager) provides the treating physician with the necessary information for utilization review and pre-certification.

 

If the adjuster’s office utilizes a medical bill review company to verify proper billing, the adjuster must be sure the medical bills are provided to the vendor for processing.

 

 

  1. Return to Work:

 

The adjuster coordinates with the employer and the medical provider the employee’s to return to work as soon as possible on modified duty or full duty, as appropriate.

 

 

  1. Subrogation:

 

As part of the investigation, the adjuster determines if any third party can be held responsible for the employee’s injury. If so, the adjuster places the third party and their insurer on notice of the intent to subrogate. Once the claim is concluded, the adjuster or the designated subrogation adjuster pursues recovery of the amount paid on the claims.

 

Subsequent Injury Fund/Other Offsets:

 

  • In the jurisdictions with a subsequent injury fund, the fund is placed on notice of the claim as soon as medical information reflects the potential for recovery from the fund.
  • The file reflects how social security disability benefits, short-term or long-term disability benefits, unemployment benefits or any other benefits the employee is receiving will impact the amount paid on the claim.

 

 

  1. State Filing:

 

Properly completes and files on time, all state required forms.

 

 

  1. Litigation Management:

 

All files requiring defense counsel are assigned to counsel on time. The initial assignment of the file to defense counsel provides instructions to counsel on how the adjuster wants to proceed with the claim. Any issues or disputes are brought to defense counsel attention with a request for counsel’s recommendations.

 

A litigation budget is submitted by the defense attorney outlining the projected cost of defending the work comp claim.

 

The adjuster provides defense counsel with on-going instructions on how the adjuster wants to proceed with the claim. All reports from the defense counsel are reviewed and answered as appropriate.  All billing from defense counsel are reviewed and approved, if appropriate or questioned, if needed.

 

 

  1. Diary:

 

When the adjuster completes the initial 3-point contact, all further activity on the file is planned and placed on the adjuster’s calendar for completion. All issues noted in the Action Plans are given a diary date for completion. The diary is kept current until the file is completed.

 

 

  1. Progress Notes:

 

Every activity completed by the adjuster is noted in the file notes. The file notes are clear, comprehensive, concise and understandable.

If the adjuster completes each of these “Best Practices,” the quality of the work comp claim file reaches a high standard, and claim resolution is appropriate.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

 

 

Aggressive Defense of Workers’ Comp Mental Injury Claims

Aggressive Defense of Workers’ Comp Mental Injury ClaimsThe expansion of workers’ compensation laws to include mental injuries has added to the many challenges members of the claims management team face on a daily basis.  Among these include the investigation of mental injury claims, the review of medical records and use of independent medical experts to properly position and defend these claims.  While these challenges are numerous, failure to adopt effective claim management techniques can add to the cost of claims and decrease the efficiency of a workers’ compensation program.

 

 

What are Mental Injuries in Work Comp?

 

There are two main types of mental injuries in workers’ compensation claims.  It is important for interested stakeholders to understand the variety of challenges one can face and effectively handle them:

 

  • Physical/Mental Injuries: This type of claim typically results because of a physical injury.  For example, the employee suffers a low back injury.  Following the injury, the employee develops depression or other psychological and/or psychiatric sequela.  The challenge in handling this type of claim is the employee is suffering from conditions that require more than one medical expert – one handling the physical component and the other including metal issues.

 

  • Mental/Mental Injuries: This is an injury that results from work-related mental stress or stimulus that produces in many cases symptomology or ailments deemed to be compensable.  The legal standard for this type of injuries varies in each jurisdiction.  Claims for mental injuries usually require the diagnosis be made by a mental health professional and can be limited to certain conditions such as Post-Traumatic Stress Disorder (PTSD).    In some instances, “mental/mental” injuries are not compensable – and can only result in liability if there is a physical injury.

 

 

Claims Investigation In Mental Injuries

 

Whenever an employee makes a claim (or can make a claim for mental injuries), it is important for the members of the claims management team to take note and use extra caution.  These types of claims carry significant medical and indemnity exposures.  They can also be costly to defend.  Areas of investigation for mental injuries should include the following:

 

  • Complete medical background, including medical care and treatment with psychological and/or psychiatric professionals;

 

  • Information concerning the employee’s history of substance use and/or abuse. This should also include the use of alcohol, prescription medications, and street drugs.  Employees are often hesitant to answer questions about these matters and can become a point of contention during recorded statements and depositions;

 

  • Family history and interpersonal relationship information. This can include adoption, gender identity dysphoria or divorce;

 

  • Criminal background check and arrest records; and

 

  • Information concerning the employee’s credit history and insurance claims.

 

 

Aggressive Defense of Mental Injury Claims

 

Members of the claims management team must treat all employees with the respect and dignity they deserve.  It is important to confront cases involving psychological and/or psychiatric claims with an added level of care given the sensitive nature of these issues.

 

  • Investigation: Never leave a stone unturned when handling these cases.  It is important to obtain complete information about the employee and the events surrounding the injury.  Important factors include whether the employee directly witnesses the incident leading to the claimed mental injury, the magnetite of the mental stress suffered because of the incident, the nature, and quality of fear and anxiety connected with the event in question and whether the stressor is something beyond what one would ordinarily experience.

 

  • Experts: In many mental/mental workers’ compensation claims, an effective defense will require the medical opinions of multiple medical experts.  This will often include psychologists, psychiatrists, neuropsychiatrists, therapists/counselors and/or social workers.

 

  • Legal: Given the complexity of these type of claims, members of the claims management team often refer these cases for defense.  Before a referral is made, a claims handler may consider setting the claim on for a “roundtable” session or having it reviewed by a peer.  Using an aggressive defense attorney is a solution when all else fails.

 

 

Conclusions

 

Workers’ compensation claims that involve a psychological and/or psychiatric component require members of the claims management team to be fully engaged.  This is due to the fact the exposures can be costly, and bad decisions can negatively impact a program’s bottom line.  Interested stakeholders need to understand the issues involved and defend these matters with care to be successful.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

 

 

6 Ways to Make Workers’ Comp Claims Audits/Reviews Impactful

6 Ways to Make Workers' Comp Claims Audits/Reviews ImpactfulLooking to reduce your workers’ compensation costs, improve outcomes, lower your ex-mod? Plan and prep for your next claims audit/review. This is a tremendous opportunity to ramp up your workers’ compensation program and make it best-in-class.

 

Even though the vast majority of employers engage in these sessions the results are fairly dismal; instead of being a synergistic way to improve an injury management program, they often end up as a finger pointing session and lead to the production of a report that sits on a dusty shelf and is forgotten. But with proper planning, execution, and follow-up, you could potentially see your ex-mod cut in half in just a couple of years.

 

 

Building Relationships

 

A claims audit/review brings together the parties involved in the claims handling process; the employer, carrier/TPA, broker, medical experts and any others who might lend some insight. These sessions can benefit an employer in two ways:

 

  • To get a big picture view of how claims are being handled and areas that could be improved
  • To look at specific claims and figure out how to move them forward to closure

 

 

Planning

 

The goal of a claims audit/review is to develop a team mentality, where each party understands what the others are doing in working toward a common goal. This requires everyone involved to be open to listening to one another and begin to forge bonds. Follow several specific strategies:

 

  1. Stop the blame game. Too often employers and others see the claims audit/review as a chance to point out what they perceive as failures by the other parties.

 

  • The carrier or TPA is not doing its job
  • The adjuster isn’t doing a proper investigation
  • The medical providers are not getting people back to work
  • The employer doesn’t take responsibility for its role in the process

 

A session based on finger pointing is a negative waste of time for everyone involved.

 

  1. Set expectations. Each party in the claims audit/review should understand what he is expected to do to help claims progress. The activities of each are dependent on the actions of the others.

 

For example, the adjuster cannot make 3-point contact within 24 hours of the injury if the employer doesn’t report the claim for several days or longer. The employer must understand his responsibility for timely claims reporting, while the adjuster needs to be committed to making early contact.

 

  1. Keep communication channels open. The audit/review should be seen as the beginning of a relationship, not a one and done event. Employers and adjusters should maintain contact with one another after the session.

 

  1. Select the right claims. For small organizations with just a few claims, it’s appropriate to review every claim. Companies with hundreds of claims must be selective. Ideally, there should be a number of ‘typical’ claims, as well as some that may raise red flags. There are several ways to identify claims to be reviewed, examples include:

 

  • Claims with large reserves, especially if they have been open for more than a year, and medical-only claims that have been open for at least six months.
  • Large medical-only claims. An injury that does not render the worker unable to work but includes significant expenses may have something unusual about it that needs to be examined.

 

The claims selected should not include any personal information about the injured worker.

 

Execution

 

  1. Review specific aspects. There are a multitude of aspects to every claim that could be discussed and analyzed. But instead of nitpicking, select the areas that are most telling about the claim. For example

 

  • Was the claim reported promptly?
  • 3-point contact. Were the employee, employer, and physician contacted within 24 hours of the injury?
  • Was a recorded statement taken of the injured worker and witnesses?
  • Treating physician. Was medical control established?
  • Post-appointment contact. Was there follow-up with the injured worker after the first appointment with a medical provider?
  • Were checks issued to the injured worker promptly?
  • Did someone contact the injured worker and explain timelines and other aspects of the workers’ compensation process?
  • Were state forms filed timely?
  • Were they put up properly and timely? And were reserves reviewed for reduction or closure timely?

 

  1. Follow-up. To make the claims audit/review truly meaningful requires the parties to agree on ways to proceed. A designated person should issue a report following the meeting. But rather than it going up on a shelf collecting dust, it should include action steps for each participant which should be agreed upon during the meeting.

 

 

Conclusion

 

Claims audits/reviews allow all the parties to claims handling to come together, determine best practices and identify areas that can be improved. Companies that prepare and are actively engaged in this process reap significant benefits.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a 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/

 

©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.

 

 

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