3 Simple Tasks To Apply To Every Work Comp Claim

 

Members of the claims management team are always looking for cost saving measures on their workers’ compensation claims.  This is due to the fiduciary duty to the insurance carrier they work for and requirements under the workers’ compensation act to provide injured parties with the benefits they are entitled to receive.  While there are techniques developed over time, simple tasks on every file can lead to responsible cost savings on every file.

 

 

Step 1:  Know Your Files

 

The average workers’ compensation claim handler can be responsible for handling up to 200 claim files from potentially a variety of jurisdictions.  This creates countless headaches for everyone involved on the claim management team.  While each person may have their own style or file organization, there are certain steps that one can take to master the process and be effective and efficient.  These steps include:

 

  • Analyzing workers’ compensation claim trends and identify the various drivers that increase risk and impact loss experience. Various important trends include the demographics of the injured workers, the nature and extent of their claimed injuries and economic trends in the community in which the injury took place.

 

  • Understanding the barriers to settlement and ability to resolve cases in a timely manner. In the business of claims management, “the only good file is a close file.”  While some claims take longer than others to close, an initial analysis on what pitfalls might lay ahead will help the claims handler develop a strategy for getting the file closed in a timely manner.

 

 

Step 2:  Move Your Claims toward Settlement

 

The inability to move claims toward settlement causes stress on the individual claim handler and the rest of the team.  In some instances, more experienced claim handlers will need to pick up files from a team member if the claims are not handled in a proper manner.  Tips for closing files in a timely manner, but at the same time ensuring the injured party receives the care they are entitled to receive include:

 

  • Setting proper reserves on claims. Claims that are reserved too high need to be adjusted downward.  This places financial stress on an individual carrier and limits their ability to use capital in an appropriate manner.  In the same regard, claims that are reserved too low also have a negative financial impact and place limitations on settling other cases.  Common issues that arise when setting proper reserves include a realistic evaluation on future disability and medical care an injured employee may need.

 

  • Failure to review files on at least a quarterly basis. Dust collecting on a claims file is a sure sign of ineffective claims management.  By making the effort to review files on a consistent basis, proper evaluation will be given to matters that hopefully can close.

 

 

Step 3: Leverage The Insurer Relationship

 

An effective workers’ compensation claims management team should communicate with their insurer about risk.  This includes helping to understand simple items like how their workers’ compensation insurance premium is calculated and how to legally and ethically reduce costs.  This includes a number of different cost-saving mechanisms:

 

  • Ongoing discussions regarding the impact injury and disability have on the experience modifier;

 

  • How to legally report payroll amounts as required by state law. This is often an issue with part-time employees, or persons working for an employer as an independent contractor; and

 

  • How to improve the overall safety of work sites and facilities.

 

 

Conclusions

 

There are many simple ways to reduce workers’ compensation costs through effective claims management.  This includes the work of the individual claim handler to better organize their files and assist the interested stakeholders in the process.

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

Give Your Work Comp Adjuster A Hand To Achieve Better Outcomes

Adjuster Objectives:

 

Some objectives of every workers compensation claim adjuster should be to:

  • Promptly investigate.

 

  • Monitor medical care.

 

  • Process the workers compensation claim to a timely full disposition.

 

  • Maintain constant dialogue with employee, employer, and all other entities directly connected to the loss.

 

  • Secure any potential recoveries.

 

  • Develop the loss for the best outcome possible.

 

  • Be adequately educated, trained and continually self-educated for continued professional growth.

 

Additional adjuster objectives:

 

  • Clearly compensable claims should be paid promptly at the proper benefit rate, medical care should be the best available, and prompt return to work should be a priority.

 

  • The adjuster should be available to assist the injured employee as needed.

 

  • Good claim work results in minimal disability, good employee relations, and lower claim cost.

 

  • Conversely, claims that are questionable, malingered, fraudulent, or suspect for any reason, require the claim adjuster to be extra determined so that a good investigation and claim preparation can sustain declination and litigation.

 

  • Workers Compensation Claims are always under time guideline and handling pressure. Decisions and actions must be made or done quickly.

 

 

Employer Injury Coordinator & Assisting The Adjuster

 

The adjuster has primary responsibility for successful claim disposition.  However, the adjuster can only be as effective as the information gathered during investigation.  Therefore, every employer should strive to get the full facts, and supporting documentation to the adjuster as soon as possible after the loss occurs.

 

Every employer should have at least one person assigned to establish policy and procedures to implement when an injury occurs.  The person should know and understand all requirements of the workers compensation management program, including the employer and employee responsibilities.

 

One of the biggest responsibilities of the employer injury coordinator is communication with the claim adjuster.  This should be done as necessary, and during acute stages of a claim it may be daily.   As time passes on this claim this should continue on a regular weekly schedule.

 

 

Conclusion:

 

Worker’s Compensation Adjusters need to have good education, training, and the highest objective standards in order to reach proper handling and resolution of claims.  However, they cannot achieve this without proper employer support and interface.

 

Employers who designate an employee to be the workers’ comp injury coordinator to assist the claim adjuster will reap the benefits of better claim handling and cost.

 

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

What Is The Claim Handling Score At Your TPA?

claim-handling-scoreEmployers often wonder if they are getting quality claim handling on their workers’ compensation claims.  At the same time, the third party administrators (TPA) providing claim services to employers often struggle with producing a quality product due to the facts and circumstances of each claim being different.

 

 

 

Top-Tier TPAs Evaluate Every File for Claim Quality

 

Each TPA will have a set of Best Practices stating what is expected on every claim.  A top-tier TPA will not only have the written set of Best Practices, they will evaluate the adjuster’s claim quality using both performance measurements and diagnostic indicators to evaluate the adjuster’s performance.

 

As every activity of the adjuster on the claim file is recorded in the electronic notes of the computer file, it is simply a matter of data mining to determine if the adjuster is complying with the established Best Practices.  When the workers’ compensation adjuster enters a new file note, the date and time is automatically recorded.  Each file note has two drop-down selection codes, one for type of activity being completed and one for the type of person contacted – employee, employer, medical provider, employee’s attorney, defense attorney, etc.  After the note is coded, the actual details of what was accomplished are entered.  For example: “Requested Dr. Smith’s office to email us the office visit notes.”

 

With all this data, the grading and evaluating of the adjuster’s performance becomes highly measurable.  To prevent ‘gaming’ of the system, the TPA will have internal auditors reviewing select files, or with some top-tier TPAs all files, to insure accuracy of what is recorded in the system.  For example, if the adjuster coded the file note ‘contact – employee’, but the details of the file note reflect only left a voice mail, the proper coding should have been ‘attempted contact – employee’, and the file note coding can be corrected.

 

 

 

Areas of Evaluation

 

The areas of quality evaluated and graded through performance measurement include:

 

  • Initial employee contact within 24 hours

 

  • Initial employer contact within 24 hours

 

  • Initial medical provider contact within 24 hours

 

  • Initial reserve within 72 hours

 

  • Reserve review with 30 days

 

  • Initial report to client within 14 days

 

  • Status reports to client every 30 days, or as previously indicated in a prior report

 

 

The areas of quality evaluated and graded through diagnostic indicators include:

 

  • File on diary

 

  • Proper completion of claim progress notes

 

  • Reserve worksheet to support reserve changes

 

  • Timely ISO filing

 

  • Timely supplemental ISO filings

 

  • Payments made on closed files

 

With all the data generated, the computer program calculates the adjuster’s performance.  The computer program can be set to select only indemnity claims or it can include all claims.  The computer identifies all claims reported within the reporting month (normally a calendar month, but data can also be compiled on any 30 day period).  For example:  The computer identifies all indemnity claims assigned to Adjuster Jones during July, it reviews all data for the claims that had initial employee contact within 24 hour, and calculates the percentage of claims where the employee was contacted within 24 hours of the initial report of the claim.

 

The computer program completes the calculation for each of the performance measurements and diagnostic indicators and assigns a numerical percentage score to each category.  The computer combines all the categories into a numerical score for each adjuster to provide the TPA management a quality score for each adjuster.

 

 

Claim Quality Scores are Invaluable Tool for TPA

 

The quality scores compiled by the TPA are an invaluable tool that can be used for several different purposes. The score results can be used as:

 

  • A component of the adjuster’s semi-annual or annual performance review

 

  • A promotional tool to sell the TPA services

 

  • A motivational tool to encourage the adjusters to perform at their maximum

 

  • A way to encourage friendly, internal competition in each office to see which adjuster can provide the highest level of service

 

In addition to building adjuster’s pride by scoring well, some TPAs offer bonuses for top scores or a bonus to everyone who exceeds a predetermined mark.  For example – $100 monthly bonus for a score of 95% or higher, or a $500 annual bonus for averaging 97% or higher for the entire year.  Other prizes can be offered for the most improvement, the highest overall performance, etc.

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

Pay Without Prejudice – Solution To Big Work Comp Problem

Imagine this scenario … you started working for your company about six years ago. One day you’re walking into work in the parking lot … you slip and fall and you hurt your back. There’s a question of whether or not that injury is work-related. You go in to get medical treatment. You’ve get a great health insurance plan but they won’t cover your medical expenses, because you have a work comp claim that’s in dispute. Also, because your work comp claim hasn’t been accepted you can’t get medical expenses covered under that plan either, so, now you’re left to have your injury continue to get worse.

 

 

Delayed Or Denied Medical Treatment Is Big Problem

 

This scenario that I’ve described is a problem in our industry. I’ll say it again. This scenario that I’ve just described is a problem in our industry. I’m Michael Stack, with Amaxx, and, today I’m going to be talking about a solution to that problem. It’s called, Pay without Prejudice, and, in Maine, it’s Statute Number 222, called Provisional Payments of Certain Disability Benefits.

 

I want to graph this out for you and show you what this looks like. It’s very common and a big problem, as I said, in our industry. Let’s talk about this. You have your back injury … here’s the time of injury. I’m going to graph this out in blue and in red. In blue’s going to be the cost of the injury, and in red is going to be the severity.

 

You have what might be a very simple injury. It might be something that just needs a little bit of treatment and you can get back to work right away, but because you can’t get your medical expenses covered, there’s a delay in treatment. Your injury gets worse and worse and worse. The cost is going to follow, of course, in a very similar timeline when it becomes more and more expensive.

 

The longer the delay in treatment the worse your injury becomes, the more expensive the injury becomes, the more of an impact it has on that individual’s life, the less likely they’re going to be coming back to work. The more likely they’re going to be out on a lifetime disability claim, the longer that injury goes untreated. This is a problem in our industry.

 

 

Pay Without Prejudice & Maine Statute 222

 

Here’s the solution. It’s called, Pay without Prejudice.” In Maine, again, it’s Statute number 222, Provisional Payment of Certain Disability Benefits. This is a concept we talked about in The National Work Comp Conversation, and, this Maine Statute really came into the conversation during those discussions. Basically, what it says is that there’s no delay in benefits. Even though a work comp claim is in dispute, you cannot delay or deny the benefits to get that medical treatment. It’s written right into the statute in Maine.

 

If you’re not in the State of Maine, you can write this right into your account handling instructions … your account service instructions. If you’re a self-insured employer, or, if you have a high-deductible plan this is a concept that should be in your policy, because this back injury can get addressed right away. This person can get right back to work and these costs remain contained. It creates a better outcome for the injured worker and significantly controls your work comp costs.

 

If it’s determined that your claim either was or was not compensable the appropriate carrier … either the health insurance carrier or the work comp carrier, can be reimbursed for those expenses appropriately. Pay without Prejudice, and, in Maine … Statute Number 222 … Provisional Payment of Certain Disability Benefits. If this is not in your state talk to your legislators. If this is not in your account handling instructions this is a concept that should be. Remember your success in worker’s compensation’s defined by your integrity … so, be great.

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

Low Back Pain: Dealing with the Proverbial Pain in the Butt!

back-painInjuries to the lower back and the symptomology associated with such claims make up a significant portion or all workers’ compensation claims.  This requires members of the claims management team to be proactive when it comes to injuries involving the lower back.  It also serves as an opportunity to understand the origin of such incidents and take steps to prevent them.

 

 

The Anatomy of the Spine

 

The spinal cord is the core of a person’s central nervous and skeletal system.  It is an important part of the body’s infrastructure.  It is made up of many important parts that holds a person together.

 

With respect to the spinal cord, several key segments claim handlers need to understand.  This includes:

 

  • Cervical spine: This is the region of the spine that connects to a person’s brain stem.  It is comprised of seven (7) vertebrae.  In layman’s terms, this region of the spine is called the neck.

 

  • Thoracic spine: This is the midsection of the spine and is comprised of 12 vertebrae.  This portion of the spine does not bend back and forth as often, which allows vertebrae fractures to heal with some certainty.

 

  • Lumbar spine: This is the lower part of the spinal cord and is comprised of five vertebrae.  Like the cervical spine, this part is subject to many stresses of everyday activities.  Functions such as bending, twisting and sitting place extreme stress and are subject to a part percentage of everyday and work-related injuries.

 

There are also other important components to a spine.  They include:

 

  • Sacrum and Coccyx: The sacrum typically includes five vertebrae structures, which are attached to the lumbar spine.  In turn, the sacrum is connected to the coccyx, which is commonly referred to as the “tailbone.”  These bones are also involved in countless work injuries.

 

  • Discs: These are the spinal cords “shock absorbers” and are similar to a jelly donut.  Injuries to discs result in herniations, which causes them to lose their absorbency.

 

 

Dealing with Secondary Gain in Low Back Pain

 

Degenerative changes in the spinal cord, especially the lower back, are common for any person to experience over their lifetime.  This is based on activities of daily living that places stress on the vertebrae.  Studies indicate that the average American over the age of 40 has some degenerative changes in their back, which may include herniation without symptomogy.  The result of this is for members of the claims management team to be proactive when handling a claim involving a spinal cord injury.  Factors that delay recovery often include:

 

  • Common themes for this characteristic include the age of the employee;

 

  • Tenure in a position (both long and short term);

 

  • Language or other cultural barriers;

 

  • Lack of interest in returning to work;

 

  • The presence of return-to-work opportunities; and

 

  • Seriousness of the injury.

 

 

Identifying Secondary Gain and the Low Back

 

One common test used to identify malingering is the Waddell’s Test.  Gordon Waddell developed this test in 1980 to indicated symptom magnification in low back injuries.  This test can be a part of an independent medical examination, as well as a review by the treating physician.  Proper use of this test includes the following:

 

  • Superficial tenderness or overreaction exhibited by the patient;

 

  • Testing that does not cause stress on the spin, but results in pain;

 

  • Examination techniques that include distraction and re-verification when the patient is properly oriented; and

 

  • Disturbances that do not have a known etiology.

 

Claimants who exhibit a “positive” test should be scrutinized and possibly treated for other underlying conditions, which can include depression, or other psychological/psychiatric conditions.

 

 

Conclusions

 

Dealing with low back pain claims can be challenging for members of the claims management team.  Through properly training and understanding of the spinal cord, members can develop tactics to identify symptom magnification and resolve troublesome claims.

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

You’re Fired! Work Comp and Retaliation Claims

The filing of a workers’ compensation claim often creates an adversarial relationship between the employer and employee.  This is based on a number of self-apparent reasons, which are compounded in some instances by the primary denial of benefits.  In other cases, the escalation of ill will between the employer and employees frays out of control and results in the employee being terminated from their employment during the claims dispute process.

 

 

Statutory Safeguards for Injured Employees

 

A variety of state and federal laws and rules protect employees when they claim a disability or injury in the workplace.  One common protection is frequently found in individual workers’ compensation laws that allow an injured worker to bring a civil lawsuit if the employer retaliates against them for alleging a work-related injury.  Under these anti-retaliation statutes, employees can receive the workers’ compensation benefits they otherwise would be entitled to, plus additional compensation.  This monetary amount is usually set forth in statute and enforced by civil courts, and not under an administrative process.

 

 

Understanding Work Injury Retaliation

 

The requisite elements for bringing a work-injury retaliation vary in each jurisdiction.  Always consult with an attorney if you have questions.  The general rule for an employee to bring such claims and make the prima facie case for a retaliatory discharge include the following elements:

 

  • The person in question must be considered an “employee” for purposes of the workers’ compensation act;

 

  • The employer must make an adverse employment decision or termination against the employee; and

 

  • There must be a “casual connection” between the employee and the adverse decision.

 

If these elements are properly demonstrated, the employer will typically have the ability to rebut the presumption of retaliation to provide a legitimate reason for the discharge, or other evidence demonstrating a non-discriminatory reason for their action.  Some information used by employers include:

 

  • Documented unexcused absence by the employee that is consistent with how other employees are treated;

 

  • Information concerning acts of misconduct or prohibited actions by the employee; or

 

  • Failure to accept work within restrictions as outlined by the treating medical doctor.

 

It is important to document the rationale for termination and treat all employees equally.

 

 

Avoiding Work Comp Retaliation Claims

 

Avoiding claims and allegations starts with proactive leadership at the employer and includes a role for the claims management team.  Effective strategies for reducing your exposure and the cost of claims starts with you:

 

  • Develop an effective response to all work injuries. Every person injured within a workplace is a human being and should be treated as you would like to be treated.

 

  • Assist injured workers and respond to their questions. Effective claims management teams and interested stakeholders at employers can build good will and confidence with an injured party by responding to their concerns.  They can also do the little things to make them feel important by sending a “get better soon” note or card.

 

  • Provide a non-legalistic to answer when communicating with injured workers. Remember, you deal with workers’ compensation on a daily basis.  Explaining benefit eligibility and the rationale for medical decisions can only be communicated effectivity if the person receiving the information understands it.

 

  • Sometimes an employee may need to be terminated while out of disability due to a work injury. When this takes place, it is important to be aware of applicable state and federal laws concerning employment practices, document all actions and reactions fairly and accurately, and be consistent when dealing with all employees—regardless of an injury or disability.

 

 

Conclusions

 

Retaliation claims in workers’ compensation claims are not common.  They can be costly if employment practices are inconsistent and not compatible with applicable laws regarding these matters.

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

Guidelines To Determine Right Case Load For Your Work Comp Adjuster

When Workers Compensation Claim Adjusters have caseloads that exceed their capacity, experience, or training, the technical handling of the claim file can suffer greatly.  The resulting claim cost can be minimal to astronomical.

 

Problem:

 

An adjuster with a case load that exceeds their capacity, experience, or training can fail at the following:

 

  • Missing diary dates and following through on plans of action.
  • Allowing over payments of both benefits and medical bills.
  • Missing excessive treatments and prolonged disability.
  • Performing cursory investigations that allow the claim to be improperly processed to disposition.
  • Missing subrogation potentials.
  • Poorly documenting the file.
  • Poor reserving practices.
  • Allow subsequent involvement of underlying medical pathologies.
  • Fail to prepare properly for disposition.
  • Miss proper filings with the state that will incur fines and penalty.
  • Missing exaggerated or fraudulent situations.
  • Failing to establish professional rapport with the injured employee.

 

The list goes on…

 

 

Case Handling Guidelines:

 

Adjuster case load studies and independent claim audits generally reached similar conclusions as to what constitutes criteria for proper case work-loads.

 

They have found work should be distributed by level of claim needs, so the answer is not a one size fits all conclusion.  Jurisdictional requirements, adjuster experience, and ancillary support play a large part in determining claim personnel needs.

 

Here are some general guidelines by claim type:

 

Medical Only

 

Most claims only require medical care for short periods of time.  This ranges from 80% to 90% of the injuries sustained, and cases normally close within six months.  With current medical fees, the total cost should not exceed a $25,000 value.

 

There cannot be any lost time from work past waiting periods.  No permanent disability should be paid as a medical only.

 

In most jurisdictions, a medical adjuster can carry a monthly caseload as high as 250 to 300 claims.  (New cases should be assigned against closures.  Closures should be equal to or greater than new assignments.  Monitoring of open files must be a regular task to avoid cases remaining open that should be closed.)

 

A few jurisdictions require state approval before payment is made.   This may limit case count activity.

 

 

Active Lost Time Claims

 

Active lost time claims (indemnity cases) vary from a few days up to multiple years.  The adjuster’s active handling tends to slow within three to nine months, and most settle with minimal or no permanent disabilities.  The indemnity claims usually average between 5% and 8% of reported losses.

 

Depending on the jurisdiction, an experienced adjuster can handle a case load as high as 125 to 200 claims a month, and new cases should be assigned on the closure record. (Monitor that closures are current)

 

 

Fatalities, PTD, Catastrophic, Occupational Disease

 

The last category covers fatalities, permanent total disabilities (PTD), other catastrophic cases, and long term occupational disease that often require reinsurance intervention.  This level of adjuster typically has 10-15 years experience and handles multiple jurisdictions.  This adjuster will have a much lower case load because the claims are more complex.  Once the claim has settled into routine maintenance it can be assigned to a lighter experienced adjuster.

 

 

Summary:

 

The question of how many claims is too many claims for an adjuster does not have a one-size fits all answer.

 

To evaluate whether or not your TPA has assigned too many claims to the adjusters is often a difficult task as the TPA will be reluctant to admit the adjusters have too many files.  You can obtain a general idea as to whether the caseload is too high by reviewing the nature and type of claims, as well as the requirements of your states work comp act.  To know more precisely what the caseload should be, hire an outside, independent claims auditor to complete a Best Practices Audit of the TPA files.  The outside expert can assist you in identifying the issues impacting the claims quality and identifying the appropriate caseload for each adjuster handling your claims.

 

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

20 Things Your Work Comp Adjuster Should NOT DO

Most states have an Unfair Claims Practice Act that outlines what is considered to be unethical behavior by the claims adjusters.  The large majority of adjusters are ethical and have no interest in doing anything inappropriate.

 

Workers compensation adjusters have to deal with more fraud than other insurance lines.  This can cause the adjusters to become cynical about any claim that has a red flag anywhere in the claim process. The temptation to fight fire with fire can become strong, but the adjusters should know better than to get drawn into this trap.  Unfortunately, occasionally the adjuster gets too personally involved in the insurance claim and makes a poor decision.

 

If any of the following actions or behaviors by the dedicated or designated workers compensation adjuster is noted, speak up.  Ask them why they took any of the following actions:

 

 

  • Not contacting the employee (often with the false hope the employee will decide not to pursue a fraudulent claim and just go away)

 

  • Not returning phone calls (again with the false hope the employee will go away)

 

  • Not explaining the indemnity and medical benefits to the employee correctly

 

  • Denying a claim without adequate proof

 

  • Handling a claim with an employee they personally knew prior to the employee’s injury

 

  • Creating / having a personal relationship with an employee during the course of the claim, or after the claim is concluded

 

  • Intentionally not paying unrepresented employees for a permanent impairment rating

 

  • Purposefully under reserving a claim to avoid management review thresholds or reporting thresholds

 

  • Recording telephone conversations without the other person’s knowledge

 

  • Knowingly taking the recorded statement of an employee under the influence of any medication that impairs thinking

 

  • Intentionally not providing a copy of a recorded statement to the employee when requested

 

  • Intentionally not reimbursing mileage expense or other cost paid by the employee

 

  • Making an unrealistically low settlement offer to buy out future medical or indemnity benefits

 

  • Intentionally including incorrect information in the written summary of the claim

 

  • Allowing detrimental information about the employee that is not related to the claim to impact the handling of the claim (for example the employee has been arrested for spousal abuse).

 

  • Contacting an employee they know is represented by an attorney

 

  • Violating the privacy of the employee by sharing personal information about the employee with people without a need to know

 

  • Moonlighting/working for a plaintiff law firm as a second job

 

  • Intentionally misleading claims management or self-insured employers with the intent to get higher than necessary settlement authority (normally just to quickly get rid of the claim)

 

  • Any settlement sharing agreement with the employee or the employee’s attorney

 

 

When asking the adjuster why they did any of the above actions, they will normally state it was oversight (and sometimes it was) and the adjuster will then act to rectify the situation.  One oversight or ethical breach does not make for a bad adjuster, multiple oversights or breaches should result in the adjuster’s termination of employment.  If the adjuster’s employer does not terminate the unethical adjuster, you should terminate the relationship with the adjuster’s employer.

 

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

6 Ways To Maximize Your Work Comp Adjuster Relationship

The best ways to reduce workers’ comp costs is to reduce claim costs. A major factor in the cost of claims is the quality of claims handling provided by the workers compensation adjuster.

 

There are at least six things an employer can do to improve the results the adjuster obtains for you:

 

 

  1. Get Your Own Adjuster

 

Too many employers allow the insurance company or the third party administrator (TPA) to chose their adjuster. If you have more than just a few open workers compensation claims at any one time, you soon to begin to evaluate the effectiveness of adjusters working on your claims. When you know who is the best adjuster or the best two adjusters are, ask the insurer or TPA to assign all your future claims to the adjuster you have selected. Express appreciation for the adjusters not selected, but put some emphasis on why you are requesting a certain adjuster, whether it is better overall results, quality communications or some other reason.

 

 

In the claims office, when an adjuster handles all the claims for a particular client, but also handles claims for other clients, the adjuster is referred to as the designated adjuster. If you have 100 plus claims in one claims office, ask for a dedicated adjuster who handles claims only for your company. Know the difference between these two types of adjusters. The benefits of having either a “designated” adjuster or a “dedicated” adjuster include:

 

  1. Becoming more important to the adjuster as the adjuster knows she/he will be dealing with you frequently.
  2. The adjuster learns what you as the employer considers essential and tailors their work to meet your needs or desires.
  3. The adjuster learns more about your company and knows who to contact with questions or to obtain information, making the claims process flow smoothly.

 

 

2. Create a Partnership

The quickest way to spoil the working relationship with your adjuster is to treat the adjuster as an inferior. Instead of trying to tell the adjuster what to do on the claims, ask the adjuster what would be the best approach for both yourself (the employer) and the adjuster. With your company and the adjuster striving together to move the claim forward, greater progress will be made.

 

 

3. Timely Communication is Key

You do not need to contact the adjuster daily on each file. The best time to contact the adjuster is immediately after you learn some new information the adjuster does not have. This includes everything from calling the adjuster to discuss the details of the accident – which should be done immediately after the employee leaves the accident scene and is going to the doctor – to keeping the adjuster informed about off-work slips. If you learn today that the employee needs a MRI or some other test, notify the adjuster today, not tomorrow or next week.

 

 

Communication goes both ways. Let the adjuster know you expect the same timely communications. If the adjuster receives a surprise letter of representation from a lawyer or a medical report obtaining significant new information, the adjuster should be sharing it with you. If the adjuster knows you expect to be kept in the loop on a timely basis, he/she will do so.

 

 

4. Know What is Needed

In addition to calling the adjuster whenever you have new information, provide the adjuster with all information at your disposal to assist the claim. If the employee is going to be off work longer than the state waiting period, know how many weeks of earnings history are needed, and provide it on the appropriate state form without the adjuster having to ask for it. If the adjuster will need a job description to assist in getting the employee back to work, forward it to the adjuster before the adjuster has to ask for it.

 

 

By providing the information the adjuster needs with the minimal of delay, the adjuster will began to think of you as their favorite client/employer/insured, and the good will results in your files getting the adjuster’s attention first.

 

 

5. A *Real* Return-to-Work Program

Adjusters understand better than anyone the sooner the employee returns to work, the easier it will be to resolve the claim. Plan ahead when you have an employee off work due to an injury. Ask for the return-to-work restrictions immediately after the employee’s first medical visit. If you can accommodate modified duty for the employee, do so. It will make the adjuster appreciate you and your company (and it will save your company a lot of money in the long run). If you cannot accommodate the first set of restrictions placed on the employee, keep in touch with the adjuster and as soon as the medical provider raises the restrictions to a level you can accommodate, do so.

 

 

6. The Magic Words – Please and Thank You

The job of the adjuster is one of the most unappreciated jobs in the universe. If you want to make your adjuster’s day, try a heart-felt thank you when the adjuster investigates the questionable claim, or continues to pursue a modified duty release from the medical provider, or does anything better than it was done before on your claims.  Also, when you do need to make a request, a “Would you please call the employee?” goes a lot further toward getting something done than a command of “Call the employee.”

 

 

The results of taking these approaches – in working with your adjuster – will be workers compensation claims that get settled quickly and cheaply. This will translates into lower workers compensation cost for your company.

 

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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.

 

5 Circumstances To Review Work Comp Claim Subrogation

When a work injury occurs sometimes there is no one to blame other than the worker.  This could be from lifting too much at one time, trying to work too fast, or from simply doing too much at one time.  These types of claims are typically straightforward and easy to investigate.  If a person injures their back from repetitive lifting, the lifting of materials is the cause or mechanism of injury. Right? Maybe not.

 

But what if the injury happened due to some other outside force?  Maybe an outside vendor an employer uses from another company is walking through the halls cleaning or waxing the floor and fails to place signs to not walk in that area. And a worker falls and fractures an arm.  What to do then?

 

There are a lot of varying factors and legal issues in the world of subrogation that vary from state to state.  But, it is worth exploring some sort of recovery to recoup medical expenses and wage loss paid.  Subrogation should be explored in every claim, even if it seems the injury was due to simple “employee operation error.”

 

 

What is Subrogation?

 

Subrogation is the right for an insurer to pursue a third party that caused an insurance loss to the insured. This is done as a means of recovering the amount of the claim paid to the insured for the loss.

 

 

  1. Slips and Falls

 

When a new claim is received from a slip or fall, the first question to ask is where the accident occurred.  Let us say this happened in a parking lot of the employee’s work place.  Why did the employee fall?  Was it snowing?  Was the lot plowed and salted properly if the fall was in the winter? Was it plowed previously then more snow accumulated?  Did any other employees fall or notice slippery conditions?

 

This is most important when having an outside vendor that is hired to maintain the outside premises during winter months.  If this is the case, then there may be a subrogation claim to pursue.  If the outside vendor had a duty to maintain the premises, and failed to do so, then it can be argued depending on the jurisdiction.

 

Now say that an employee fell in a hallway or in a bathroom.  Was an outside vendor onsite to wax or clean the floors and forgot to wipe up some water that caused the employee fall? Was the area roped properly with warning signs?  Where were the signs located? Did anyone else see the signs?  Again, if a maintenance contract exists with this company, there is a claim to pursue.  Winning a subrogation claims can mean that the outside vendor pays the employer back expenses to get the worker back to full duty.

 

There are many employers that choose to use outside vendors for this specific reason — to shift the risk to an outside vendor.  Any failure to properly mark areas as being worked on or being “wet” can result in the pursuit of a subrogation claim.  The same goes for parking lots and sidewalks.  Some vendors will allow employers to list demands for winter care when the need for salting, sanding, and snow arrives.  The employer can be as rigid as preferred (with some vendors) and this way if an injury does occur, the expense shifts to the other carrier rather than incurring the total cost of the medical and wage expenses under the employer’s carrier.  Every carrier usually has a subrogation unit to pursue injuries.

 

 

  1. Tripping over something

 

Did an employee fall over a mat that was not placed down properly?  Did a worker stumble and fall due to a rug or placemat that had holes in it or it was not in proper working/functioning order?  Again, using an outside vendor to maintain these areas and rugs can help if an injury occurs.  These vendors have a duty to properly place the rugs or mats, and these floor coverings have to be in proper working order.  Now it can be asked  “How can a rug not be in proper working order?”  If a rug is down on the floor, it is in working order. But, maybe these rugs are old and worn out in certain areas, and therefore they are not as productive as they should be. They are ineffective for the purpose.  Employers use entry and exit rugs and carpets, relief mats in front of machines, anti-slip strips on steps, etc.  If any of these are in disrepair or appear in poor shape, and an injury occurs, it could be a subrogation claim.  This vendor may be responsible for failing to replace these worn items, again shifting the risk and expense from you the employer to them.

 

 

  1. Machinery injuries and Mechanical failures

 

When there is a claim where a person gets injured while using a machine, the manager will usually say that the employee was not paying attention when the injury occurred.  This may be true, but also machine manufacturers have a duty to design proper, safe equipment.  Sometimes machines have design flaws and can lead an injury. Maybe there should be a guard in a certain area where there is not one, a hand can reach an area it should not be able to reach, or the machine does not turn off all the way, even though the switch is turned fully to the off setting. All of these issues can result in injury, and the company that makes the machine can be held responsible.  This will involve the carrier bringing a machine expert, or engineer, but it can be worth the cost, especially in a severe injury.

Do not be so quick to point out operator error as the sole cause to an injury involving a machine.  The operator may have made a mistake, but the problem may stem from deeper design issues.

 

 

  1. Vehicle Accidents

 

In certain states the driver that causes an accident can be held liable.  The worker may have been doing nothing wrong other than driving down the road, when another vehicle slammed into the vehicle from behind.  Maybe the vehicle that hit the employee’s vehicle is from another company.  Even though the van may not be marked as a commercial van, it still could be a business van used for company purposes.  Who owns this vehicle that hit the employee?  What was the driver doing? Where were they going, and why did the accident occur? Motor vehicle accidents can be severe.  If there is subrogation in a vehicle case, a thorough investigation is worthwhile.

 

 

  1. Injuries from other vendors on your premises

 

If a vendor is on the premises conducting normal business, and an injury happens, there could be subrogation potential.  Maybe the cart slid away and hit the employee.  Maybe a vehicle or other mode of transportation on the jobsite was being used, lost control and hit another worker, or the vendor was unloading supplies in the back area and while stacking boxes and the boxes landed on the employee.  The subrogation unit will determine if this vendor is responsible for the injury, and they could have to reimburse you, the employer, for the cost to heal an injured worker.

 

 

Summary

 

Subrogation investigations and claims can come from injuries where employers least expect, and there are many different circumstances that caused the injury.  Talk with the carrier about subrogation and if the carrier has a unit dedicated to only subrogation investigations and the pursuit of subrogation claims.  It can save a substantial amount of claims expense, especially on those severe injuries.  The subrogation department should be reviewing every injury to see if a claim can be pursued. And every claim pursued could yield the employer reimbursement from another carrier.

 

 

 

Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: mstack@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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