What Do I Do? What Do I Do?
Those of us who cook know the time-tested technique for testing spaghetti doneness: toss a few strands up against a wall and if it sticks, it’s done – if not, well, it falls off the wall. So, what does spaghetti have to do with assessing your workers’ compensation program?
Many companies use the dartboard approach to control workers’ comp costs. They look into the global “pot” of work comp practices, pick out one or two, toss a solution against the wall, and hope it sticks. In other words, without really knowing what to do, they decide to “fix” some part of their WC program – an unplanned, unsuccessful and most likely costly approach.
Unfortunately, more than 75% of companies try to work backwards toward improvement by reviewing the capabilities of their service providers and vendors rather than assessing the key problem areas in their own companies to determine the types of services ultimately needed.
Worker’s comp costs cannot be controlled on a “hit or miss” basis. A solid workers’ compensation program begins with a careful assessment of what is in place now, rather than assessing your service provider’s capabilities. Only by analyzing your company’s current trends and weaknesses are you then able to select appropriate solutions and vendors to integrate into a comprehensive cost control program without overlap or gaps.
A reasoned, impartial assessment and needs analysis is an indispensable part of an overall quality improvement process. It means determining how effective existing program elements are, not merely whether the elements exist. Solutions and recommendations for changes, upgrades or revisions in current practices are then based on a complete understanding of the “key cost drivers,” factors at the root cause of your company’s high costs.
If your workers’ comp costs are sky high, perhaps you are like one company, believing its managed care program was complete, but with $30 million in annual workers’ compensation costs. In turns out their employee brochure containing all the necessary information was written at the 11th grade level (like the Wall Street Journal), well above many of its employees reading abilities. Not effective!
Where Do I Start? Where Do I Start?
As companies reposition themselves to be more cost effective and competitive in today’s marketplace, a thorough assessment of a company’s workers’ compensation program identifies problem areas responsible for escalating costs. Only after identifying the causes of these costs, can a company evaluate its program and develop a strategic plan to control and reduce workers’ compensation costs.
First, decide if your company wants to devote internal personnel to a workers’ comp assessment process. Assessing a multi-state, multi-site company is time-consuming and many companies outsource such a project. In certain cases, a joint effort between internal personnel and outside consultants works well.
Consider the following points when deciding who will perform the assessment:
1. How will the assessment be used?
2. What are the budgetary constraints?
3. Are internal personnel available to assist? The argument for internal personnel is their greater knowledge of the corporate cultural attitudes affect workers’ compensation. On the other hand, external or independent consultants are impartial and may have experience assessing a broader range of companies.
During the pre-audit phase, reach an agreement on the purpose and scope of the audit, expected results and the content of the finished product.
Be thinking about these questions:
Is the purpose to:
1. Determine causes of escalating costs?
2. Improve internal procedures?
3. Select a new claims handler?
4. Are multiple purposes? If so, prioritize, highest to lowest?
What will the finished product look like?
1. One report from a corporate perspective?
2. A separate report detailing each operating unit’s practices?
3. An oral presentation to upper management?
4. Contain “Findings” as well as corresponding “Recommendations?”
It is important to know the intended use before going into the audit because the purpose and priority dictates the content of the assessment inquiries. And, intended use of the assessment dictates the format of the finished product.
An Assessment Report is a means to an operational end, not a well-written, handsomely bound report sitting on a shelf. It is a living, working document.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at:
Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
When it comes to implementing a workers’ compensation management program, it seems as if everyone – managers, employees, adjusters — lack the ability to understand how lack of knowledge can hurt workers’ comp cost and, the employer’s bottom line.
1- Management’s Lack of Knowledge
Management doesn’t understand the true costs of workers’ compensation far outweigh the face value of the claim.
For example, if an employee has a claim costing $15,000 – do you know how much do you really pay? Let’s say your profit margin is 8%. It’s going to take a whopping $187,500 to replace the cost of the $15,000 claim. In other words, a $15,000 claim isn’t just a $15,000 claim .
2- Adjusters’ Lack of Knowledge
Adjusters overlooking missing medical information, not understanding complex medicalese terminology, and settling large claims without all the facts and the costs associated with the claim has a huge impact on the cost of claims.
You owe it to yourself to visit the adjuster facility, determine whether or not they use good work practices. See: http://blog.reduceyourworkerscomp.com/2008/12/5-things-you-can-review-to-determine-whether-your-claims-administrator-is-doing-a-good-job/
If you see files laying on the floor, if the adjusters are being interrupted by phone calls, these are red flags. Ask to see the claims to ensure adjusters are completing vital information about the claimants and not moving forward to settlement without a complete picture of the claim.
Adjusters must understand medical terminology associated with workers’ comp claims. For example, if an adjuster thinks a positive axial compression test means the injury is genuine, then you’ve got a problem. Axial compression tests are used to see if injured employees are exaggerating their symptoms. A positive outcome means that, “yes” the employee is exaggerating symptoms.
Have your adjusters visited your facility lately? They should have a physical, three-dimensional understanding of your transitional /modified duty program and how it works. Therefore, they need to see the work sites, see the layout, and how modified duty jobs are implemented so they can make more informed recommendations.
3-Employees’ Lack of Knowledge
Employees may assume the insurance company is paying their claim. Employees may not realize the costs associated with workers’ compensation claims may come back to bite them in terms of budgetary cuts, lack of pay increases, and potential layoffs as company resources dwindle because the employer is paying out huge deductibles and related costs on workers’ compensation claims. (workersxzcompxzkit)
This is particularly true if the company has a large deductible. Thus, for each claim, the out-of-pocket expenses eat away at the finite resource pot. There is only so much money and it can be spent to benefit all employees or to pay out large claims for the few who know how to navigate the loopholes.
COMMUNICATE — It’s the key to reducing workers’ compensation costs.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Safety Committee meetings should be held often enough to achieve the agreed upon goals and responsibilities. Meeting attendance should be mandatory. The committee secretary should document the meetings, topics covered and participants. Develop an agenda, and distribute it to members at least three to five days prior, to keep the meeting and discussion on point.
Suggested safety committee responsibilities include:
1. Conducting periodic safety audits.
2. Reviewing circumstances and causes of accidents and recommending corrective measures.
3. Reviewing employees' reports of safety hazards and recommending corrective measures.
4. Developing and conducting employee safety awareness programs and training.
The safety committee can also assist in:
1. Communication with employees regarding safety committee activities.
2. Developing safety rules, policies and procedures.
3. Evaluating the safety program on a regular basis.
4. Keeping job specific training current, and motivating employees to create a safety culture in the workplace. Provide members with the necessary training to carry out their duties. Rotate committee members at pre-determined intervals. (workersxzcompxzkit)
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
"FRAUD PREVENTION" PODCAST click here: http://www.workerscompkit.com/gallagher/mp3 By: Private investigator with 25 years experience.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Your new workers’ compensation management policy is written and everyone knows all about it. So, what do you do next?
Research Communication Receivers and Pathways
1. How does communication travel in your company?
2. Does your company have a vertical communication structure: subordinate, to supervisor and up the management chain?
2. Does your company have a horizontal communication structure: peer-to-peer, inter-/-intra departmental communications pathways?
3. What about external communication?
4. How well does your company communicate to its peer companies the company is a safe place to work?
Determine: The Least Likely to Get the Message? The Most Likely to Go Out on Work Comp?
1. Do you have a contingent of workers who travel – and are not part of the inter-/intra-/vertical/horizontal communications loop such as traveling salesmen, truckers?
2. English may be a second language for a group of workers such as a large Hispanic or Asian population.
3. Do you have a group performing hazardous physical duties such as linemen, cable workers, machinists, etc.?
What is the Safety Department doing to communicate with employees and how well is the message getting out there?
1. You can discern this by watching people do things like hold the guardrails when stair climbing, wearing proper personal protective (PPE) equipment, etc.?
Dovetail workers’ comp management communication pieces in style and design.
1. To the extent safety is the flip side of workers’ compensation management, it may be worthwhile to look at their successfully communication pieces and piggyback on their strategies and tools. This does not mean to “steal” the safety person’s materials, look and see what tools work for them and how they communication successfully to their audiences, since their audience is also yours.
2. The more workers’ comp management practices are proactive, the fewer work comp claims are file and costs are reduced.
Write a Detailed Workers’ Comp Communication Plan
If you are starting your workers’ comp communications program in the middle of the year you can write an interim plan.
1. An interim plan is an outgrowth of the policy, drilling down to the what, how and when of the communication policy. The plan describes program initiatives and tools you will use to get across the workers’ comp management message across. (workersxzcompxzkit)
Once you’ve established communication pathways, target audiences, and drafted a plan, you are well on your way to implementing an effective, intentioned communications plan designed to bring employees at every level into the workers’ compensation management loop.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Frequently instruction manuals give long lists of steps on “how to” implement a program, project or even hook up a DVD, utterly confusing and overwhelming. If you just looked at a list of all the elements required to implement a first class workers’ compensation program, you would also be overwhelmed.
However, it is necessary to be aware of the elements companies need to review when auditing/assessing their internal workers’ compensation management systems, so just glance over these and then we’ll move on: data analysis; safety; communication; training; return-to-work; medical care coordination; medical cost containment; investigation; file reviews; hiring; account instructions; claim handling standards.
Six Program Effectiveness and Integration Elements
1. Don’t “inventory” the components of your workers’ compensation program for effectiveness and integration. Analyze! For example, if your company sends loss cost data to operating units each month, be sure to summarize the data to draw attention to meaningful comparisons.
2. Identify those factors differentiating your company’s characteristics and problems from other companies by inquiring into your core systems covering documentation, attitudes, procedures, current practices, policies, and management systems.
3. Thoroughly review the level of understanding and awareness within company management and employee perceptions and attitudes, critical to an effective assessment.
4. Review internal control procedures by considering how consistently they are applied. Look for procedures implemented in a timely manner. For example, higher-than-normal indemnity costs may occur if there are delays in referring claims to the insurance company and delays in employees’ returning to work.
5. Consider the intangible issues of organizational structure, such as internal company reporting relationships and duties of personnel responsible for workers’ compensation. There are certain factors impacting the types of workers’ compensation cases and expenses your company may experience, such as basic company information, your industry, number and location of employees, makeup of the workforce and type of work.
Obviously, a call-center where everyone sits in cubes and are on the phones all day experiences a different kind of workers’ comp claim than a construction company employing “girder walkers” who may fail to fasten their safety belts and fall 10 stories. Likewise, “off-site” employees experience different problems than those of permanently sited employees. Off-site employees such as delivery people, outside sales forces, seasonal construction crews often have little or no supervision, use different transportation modes or be required to carry more tools or materials – thus are at greater risk of a work related injury. (workersxzcompxzkit)
6. Global Operations. Companies with operations abroad must analyze their workers’ comp program based on the rules of operations in their global community, plus United States laws applying to personnel working overseas.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Whether your company decides to go “in-house” or “out source” the process toward building an effective workers’ compensation and/or evaluating what you currently have in place, we recommend seven methods for gathering information needed to make a careful, productive assessment. The method(s) chosen may depend in large part on budgetary restrictions and the amount of time personnel can invest.
1. Self-evaluation Questionnaires
Prepare “open-ended” questions, (not “yes”/”no”) for the employer, claims handlers, treatment providers, and attorneys. Open-ended questions encourage respondents to describe how effective they really believe certain practices or procedures are.
The drawbacks to written questionnaires are they require more time to complete; written answers may be less candid as rapport is not developed with the questioner; questions need to be complete enough to gather the right information, but simple enough so respondents actually answer them.
2. Telephone Interviews
Very useful for conducting follow-ups or companies with numerous locations, telephone interviews use the same questionnaire(s) developed for self-evaluation. More information can be gathered because the interviewer establishes a direct, person-to-person relationship with the interviewee. Also, based on responses, more in-depth inquires can be made.
3. On-site Interviews
Person-to-Person interviews are probably the most effective way to elicit accurate information from managerial level personnel as valuable insights are more frequently offered during the personal interview. Questions need to be detailed enough to enable each manager to express ideas on the key cost drivers and possible cost reduction solutions. Conduct interviews with these departments — safety, finance and operations, risk management, medical treatment providers, in-house medical, claim handlers, workers’ compensation attorneys, and union officials.
Encourage group interviews as a way to discover “gaps” in important procedures due to the duplication of responsibilities between human resources, risk management, safety and medical. Gaps often not recognized by the participants. Follow-up this group meeting with brief individual interviews as necessary to clarify and elicit sensitive information not necessarily divulged during a group meeting.When employers use the Workers Comp Kit.com assessment tools, it's a very effective group interview.
4. Employee Focus Groups
Direct employee input from a small group offers key observations about their understanding of how the workers’ compensation system works, how injured workers are treated, and what steps can be taken to improve the system. Develop focus group guidelines designed to keep the discussion focused on relevant issues.
Group discussion may uncover whether employees use the workers’ compensation system to resolve human resource problems. Are employees really injured, for example, or are they angry and/or frustrated, and using work comp claims as a vehicle to express indirect frustration with their jobs? Develop focus group guidelines designed to keep the discussion focused on relevant issues.
5. Physical Review of Documentation
A physical review determines what written procedures are in place and how well they are followed. Include a review of workers’ compensation policies, procedures, forms, employee brochures, pamphlets and newsletters. Written materials need to be written at a sixth grade level for the average person as opposed to 11th or 12th grade, a la the New York Times. Consider if languages other than English are appropriate for your workers.
6. Reviewing Loss Data
To help complete the analysis of key cost drivers, review loss data to determine the causes of losses and allocated expense ratios and percentage of medical costs versus indemnity costs percentages. (workersxzcompxzkit)
7. Physical Review of Claim Files
The claims file reviewer must decide whether file handling is proactive or reactive, and is properly focused on rapid claim closure. Both opened and closed files are reviewed to find the quality of file handling in the past. A physician or experienced claim representative reviewing files notes whether medical care is well coordinated, of good quality, if medical bills are reviewed for duplication and fee schedule compliance, if strategies for claim closure are in place and being followed, and if time out of work is proportionate to the degree of disability. Overlap of other disability policy payments must be ferreted out as well.
8. Chairside Observation of Your Adjuster
The claims process can seem mysterious, so sitting "chairside" is the best way to find out how the process works from the TPA side. You can't possibly evaluate the workers comp process effectively without doing a chairside observation session with key staff at the TPA such as intake coordinator, claims supervisor, lost time adjuster, med-only adjuster, and "enhanced" medical adjusters. You won't regret spending a few hours of your day to gather information and knowlege this way. Trust me, after 25 years helping employers reduce their workers comp costs, I KNOW how to get the most information in the least amount of time!
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
A workers’ compensation policy statement defines your company’s intent to control workers’ compensation costs. As the workers’ comp coordinator you begin by formulating a workers’ comp management policy for your company, keeping in mind policy statements are unique to every company creating them, but have common characteristics.
Make it clear when you begin to draft a workers’ comp management statement it is preliminary and will not be finalized for six months. A preliminary statement is needed now to begin implementing the other aspects of your workers’ comp management program, but you retain the authority to finalize it later.
There is no substitute for time. Time shows the reappearing issues the policy may need to address specifically. Time shows other items you must add to the template. Time makes the policy statement a working document. By waiting a minimum of six months before rolling out the policy, issues are added as they arise.
Policy Goal Statement
The first part of the policy is an overview of the policy and why it was created. Keep the language simple, and whenever possible couch the problem statement in positive words.
Keep the language simple to avoid misunderstandings. State the problem, but keep it positive. When stating the problem, avoid laying blame. If employees are languishing at home, you, as the company, must take full responsibility for bringing them back to work in some fashion — as you are admitting in the policy statement.
You might say something like this:
1. The ABC Corporation proudly announces the creation of a workers’ compensation management program. The goal of the program is to engage in company-wide management and employee practices designed to lower workers’ compensation costs.
2. The practices include the establishment of a return-to-work program, a transitional duty program, and the establishment of post-injury response procedures.
3. The policy is created because at present, employees who are injured on the job have no established way of re-engaging the work world during their recovery process.
4. Additionally the company does not have an established tracking system to ensure our injured employees receive the best medical attention immediately after a work-related injury.
Policy Implementer and Beneficiaries
This part of the policy statement describes who’s in charge of project implementation. If you’re multi-sited, you may have one workers’ comp manager with several site coordinators. Or, it may just be you, in which case, your statement can go something like this:
1. This policy applies to all employees of ABC Corporation who are injured on the job now, in the past, or in the future.
2. An inter-departmental workers’ compensation management committee will monitor the overall processes for their departments. Members will be department heads, supervisors, and employees.
3. In the event of a decision conflict, the workers’ compensation management committee has primary responsibility for hearing appeals, using an established appeals process. Representatives from all departments will take part in establishing the appeals process for the workers’ compensation management committee.
4. The workers’ compensation coordinator has primary responsibility for program management.
Keep in mind establishing a committee is time consuming. First, ask decision-makers to appoint committee members. Once they convene, they decide by charter how subsequent committee members will join. A bi-annual election is a good idea, at least for the employee part of the committee.
The Policy and Process
In this section provide more detail about how the policy is to be applied, who is exempt and how conflicts and violations are resolved, including a time frame for effectiveness. For example: “This policy applies to all full-time employees and remains in effect for the next two years.”
Policy Purpose
Boundaries for employee conduct in the event of a work-related injury are established by the workers’ compensation management policy. The policy avoids confusion, sets parameters, avoids conflict and hopefully employees know up front what the rules are.
Thus, if an employee injured on the job and in recovery decides the company might pay for a little elective surgery, the workers’ comp coordinator points to the policy stating: “The policy clearly states that the following kinds of surgery are covered unless specifically linked to the work related injury.”
Addendums
Remember, the workers’ compensation management policy is a living breathing document, designed to serve the people, not the other way around. So, if you find various aspects are not working, realign them to make them more functional.
Policy Kick Off
Let everyone know about your new workers’ compensation management policy. Consider introducing it at a general staff meeting. Serve coffee and donuts, and go over each item verbally. Don’t be surprised if it isn’t widely read by your employee audience. (workersxzcompxzkit)
Make sure employees sign in at the meeting. Then, in the event of any future disagreement, you can point to the sign-in sheet and remind them they attended the workers’ compensation management policy introduction meeting, where all points were covered.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Monitoring is critical for continued cost control. Once you have built a program lowering compensation costs, you want to maintain control over those aspects contributing to your success.
The steps the monitoring and management involves post-implementation support and monitoring of processes, injury claims and lost-time data.
After implementation, your company should be able to demonstrate continued results through:
1. Declining lost-work-day rates.
2. A shift in the return-to-work ratio showing most injured employees return to work sooner.
3. A significant decline in the cost per employee (discussed in performance goals module).
Successful implementation is also demonstrated by improving operating practices such as:
4. Correct completion of forms and claim-tracking documents after injuries.
5. Communication between all players throughout the claim process.
6. Cooperation between your company and your claims administrator.
7. Use of standardized documents/templates to structure communication with injured employees, treating physicians, internal managers and your corporate office. (workersxzcompxzkit)
Workers’ compensation is a business approach a company must deal with consistently – if you just assign tasks and walk away the company will NOT experience cost containment, the point of the whole process. And we know companies who consistently follow a work comp program reduce their workers’ comp costs by 20% to 50%.
Some companies need more staff to handle their claims. Although the cost of hiring might be high, it’s probably not as high as NOT hirirng staff when needed. If you have a large national program with dozens of employees out of work and coming back to transitional duty, it requires additional resources to assist the adjusters in identifying transitional duty positions, meeting regularly with employees to determine whether they are recovering steadily and make sure they are not experiencing any problems when returning to work.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
“FRAUD PREVENTION” PODCAST click here: http://www.workerscompkit.com/gallagher/mp3
By: Private investigator with 25 years experience.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Trinity International Corp., a holding corporation for 89 other and various companies, recently reduced incurred workers’ compensation losses by 79%; medical costs by approximately 50% and 99% of injured employees returned to work within 10 days. Trinity teaches its divisions to manage claims internally, returning employees to work as soon as medically able.
One of Trinity’s secrets in reducing work comp costs so dramatically was they actively involved their insurance carrier to help them return injured employees to their jobs. Containing the costs of workers’ compensation requires teamwork on the part of all parties involved. Trinity educated their broker, third-party administrator, insurance company and, more importantly, each of their companies so everyone understood the program and knew Trinity wanted employees back at work as soon as medically possible. It became known the corporation was willing to go to great lengths to place employees back into the work force, and their assistance in this effort was required.
Trinity redesigned its insurance program so all auxiliary services provided by outside vendors fit together into the company’s total program. The program is designed to be a vehicle for these services. Trinity also has implemented very detailed set of account instructions. The corporation approves all claims’ settlements, and written status reports on all claims over $10,000 are required every 30 days. The company follows other cost-cutting guidelines.
1-File Audits
All workers’ comp files are audited twice a year to develop a strategy to resolve not just to review each claim, These audits consist of face-to-face meetings between the company representative (usually the personnel director and general manager), the insurance company file adjuster, the insurance company supervisor, the insurance broker and the physician consultant. Meetings are followed up with a written strategy plan to ensure each party understands the action they’re responsible for implementing.
2-Investigation and Surveillance
Each accident is investigated in the plant immediately after it occurs, to determine the root cause and identify corrective measures. In addition, claims with “red flags,” or considered questionable, are investigated by professional investigators to determine whether the extent of the injury is legitimate or is being exaggerated.
Trinity recommends companies budget 5% to 10% of the total cost of the claim for surveillance.
3-Safety Management
No workers’ compensation cost control program is complete without an effective loss control program and an in-plant safety program. While Trinity has what it considers a good loss-control program, it also realizes there will be comp claims and management must be prepared to manage properly these inevitable claims. Trinity advises companies to utilize the services of their broker or their insurance carrier’s loss-control subsidiary or division, when available.
Also, employers should have loss-control inspections at every facility several times a year. Not only do firms review workers’ comp claims and safety procedures regularly, but also they need an active safety committee, a workers’ comp coordinator and a safety incentive program.
4-Performance Goals
Trinity measures program results in three ways.
1. OSHA Severity Rate: The company tries to keep the below 40/100, a formula derived by using the number of lost work days, depending upon risk or exposure. (workersxzcompxzkit)
2. Return-To-Work Ratio Goal: Trinity has an RTW ratio goal of returning 70% to 90% of injured workers to work within 10 days following an injury.
3. Cost Per Employee: The company strives to keep its CPE below $150 per employee.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Podcast/Webcast: How To Prevent Fraudulent Workers’ Compensation Claims
http://www.workerscompkit.com/gallagher/podcast/Fraudulent_Workers_Compensation_Claims/index.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Nothing Succeeds Like Success…
A leading international third-party administrator for large self-insured organizations, provides workers’ compensation, auto, and general liability claims handling.
Part of this multi-national company’s success stems from their best practices regarding workers’ compensation procedures. The claims staff divides procedures into fourteen discrete areas. Let’s look at four steps.
1-Loss Reporting
Prompt loss reporting is a key aspect of timely loss notification. Prompt reporting has three advantages.
1. Prompt quality contact with all involved parties results in reduction of claimant representation and litigation.
2. Prompt investigation
3. Reduction of overall cost per claim
2-Claim Assignment
An effective assignment process helps to ensure proper handling of claims at the appropriate technical level. The claim assignment process may include gathering additional information beyond what is available in the Employer’s First Report of Injury.
The TPA practices a team approach to claim management, distributing the work to the most appropriate level of technical expertise to gain the highest possible efficiency.
3-The Assignment Procedure
Upon receipt of a first report from the call center, fax or e-mail, a four-step process is initiated.
1. Supervisory evaluation of first report of injury for type of loss (medical only/lost time).
2. Supervisory review and direction to the appropriate claims examiner.
3. Creation of a Central Index Bureau referral for lost time claims and medical-only as required.
4. Case management services should be utilized as appropriate. (It should also be noted the claim classification and technician assignment can change throughout the life of the claim if a significant change in complexity level occurs.) (workersxzcompxzkit)
4-Coverage Verification
Coverage verification process includes confirmation of the client’s self-insured retention and valid contract and/or verification of a client’s policy of insurance with the carrier, limits of coverage, and effective dates. Coverage issues are recognized, investigated and addressed with the carrier.
All of the i’s are dotted and t’s are crossed…the claims are handled well.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.
Podcast/Webcast: How To Prevent Fraudulent Workers’ Compensation Claims
http://www.workerscompkit.com/gallagher/podcast/Fraudulent_Workers_Compensation_Claims/index.php
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.
©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
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