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Best Practices in TPA Medical Management

November 14, 2012 by

TPA Medical Management Critical for Cost Containment

 

The third party administrator (TPA) who handles your workers’ compensation claims needs to be especially strong in their medical management skills.   The top tier TPAs will have their own medical management division overseeing and controlling the medical cost of your claims and working in conjunction with the workers’ compensation adjusters.

 

The most effective ways to control your medical cost include:

 

  • Telephonic nurse case managers
  • Field nurse case managers
  • Senior nurse reviews
  • Utilization reviews
  • Medical bill reviews
  • Prescription management
  • Physician review
  • On-site clinics
  • Injury triage
  • Wellness programs
  • Preferred provider networks

 

 

Nurse Case Managers

 

Nurse case managers are experienced nurses who are utilized to coordinate and manage the medical care for an injured employee.  There are two primary types of nurse case managers, telephonic case managers (TCM) and field case managers (FCM).  Both TCM and FCM will:

 

  • Coordinate the medical care
  • Consult with the physician on treatment options
  • Prevent over utilization of medical treatment
  • Monitor the employee’s medical recovery
  • Provide frequent updates to the adjuster and employer on the employee’s medical progress
  • Coordinate the employee’s return to work, either light duty or full duty
  • Facilitate communication between the employee, employer and physician
  • Manage the medical rehabilitation of the employee

 

The primary difference between the TCM and the FCM is the location of their work.  The TCM will work from his/her office and perform all activities on the workers’ compensation claim by telephone and e-mail.  The FCM will often meet in person with the injured employee and will accompany the employee to medical appointments when appropriate.  While not a strict division of injury assignments, the FCM is more often utilized on severer injuries.

 

 

Senior Nurse Review

 

With the senior nurse review, a highly experienced nurse provides continuous oversight of medical care. This provides for identification of recovery obstacles early in the life of the claim. Through continuous monitoring of the medical care, the senior nurse reviewer can also verify the quality of medical care if the recovery time exceeds the normal disability duration guidelines.  When a senior nurse reviewer is involved in the workers’ compensation claim, the medical management provider will also have physicians with whom the senior nurse reviewer can consult.

 

 

Utilization Review

 

The medical management company should provide utilization review services.  A utilization review is an independent confirmation of the necessity for medical services.  There are 3 types of utilization review.  They are:

 

  1. Pre-certification Review – an experience nurse will collect all the medical information including the symptoms, diagnosis, test results and the reason a physician is requesting a specific medical service.  The nurse will compare the medical information against the normal criteria for a specific treatment.  If the nurse concurs, the medical service is approved.  If the nurse determines the medical care is not necessary, the matter is referred to a physician for a peer review, and acceptance or denial of the requested medical service.
  2. Concurrent Review – is a review of the medical necessity while it is in progress.  This type of utilization review is often used during hospital stays, or on-going multiple outpatient visits, for example: physical therapy.
  3. Retrospective Review – After a medical service has been completed, but before a payment is made for the service, the nurse reviews the reasons for the service and the necessity for it.  If the medical service was not needed, the retrospective review gives the adjuster justification and documentation as to the reason the medical provider is not compensated for the medical service.

 

 

Medical Bill Review

 

The medical management company reviews and verifies the accuracy of the medical bill diagnostic codes and the medical bill charges. The medical bill charges are compared to the medical fee schedule established by the state.  When there is no fee schedule, the medical charges are compared with what is customary, reasonable and necessary

 

 

Pharmacy Benefit Manager

 

A pharmacy benefit manager provides a network of pharmacies to provide medications at the best possible price.  The pharmacy benefit manager will also monitor the utilization of prescription drugs to prevent the overutilization of drugs through premature fill request, excessive dosages, multiple providers, multiple pharmacies and multiple drugs used for the same purpose.

 

 

Physician Review

 

When an injured worker is not responding to the medical care within the range of normal recovery time, a physician review is often appropriate.  The physician review is a peer review by a specialist who will evaluate and document the medical necessity of the past, current and future medical treatment.  The physician review provides an in-depth evaluation of the medical necessity of the treatment being provided to the injured worker.  The review process can strengthen the return to work program by verifying the appropriateness of an injured worker being on modified duty work. The review process can also be used to evaluate the accuracy of an impairment rating provided by the employee’s medical provider.

 

 

On-site Clinics

 

On-site (employer’s work site) medical clinics staffed by RNs, nurse practitioners and physician assistants have proven they can curb the fast-rising cost of medical care for both personal and work-related injuries and illnesses. The on-site clinic provides the medical care making it convenient for employees who do not have to leave work for care.  Employees are referred to off-site medical facilities only if the injury or illness is beyond the scope of the medical professionals in the on-site clinic.

 

 

Injury Triage

 

Injury triage is the process of having an experienced nurse evaluate the injured employee’s medical needs through the use of algorithms, software and an in-depth interview of the injured employee.  Based on the information obtained, the triage nurse makes decisions on the appropriate level of medical care needed.  While triage nurse can be utilized any time in the course of the workers’ compensation claim, it is most effective when it is conducted immediately after an injury.  The triage nurse directs the employee to the most appropriate medical provide within the in-network of service providers. This prevents the employee from over utilizing medical care while ensuring the employee obtains the medical care needed.

 

 

Wellness Programs

 

A wellness program is a company sponsored effort to improve the health of employees.  A complete wellness program will include nutrition and health education, physical fitness, health screenings and behavior modification.  An employer benefits from a wellness program through both lower cost of health insurance and lower cost in the workers’ compensation benefits.  Additionally, a wellness program will result in lower absenteeism and a corresponding increase in productivity.

 

 

Preferred Provider Networks

 

A preferred provider network is an organization of doctors, hospitals, diagnostic facilities and other medical providers who have agreed with the insurance company or self-insured employer to provide medical services to injured employees covered by workers’ compensation insurance. In exchange for the insurer or employers sending a volume of business to them, the medical providers agree to a pre-determined reduction in their normal charges for services. The reduction in cost can be substantial for the insurer or employer.

 

Employers should select one medical management partner that can provide expertise in all of these areas rather than multiple medical management partners.  A medical management partner that covers all of these areas can integrate the medical cost control services eliminating duplication of services and eliminating gaps in medical cost control.

 

 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. 

 

Filed Under: TPA and Claims Administration Tagged With: , , , , , , , , , ,

How Your Carrier or TPA Should Process Claims Intake

August 24, 2012 by

 

 

It is pretty hard to be proactive on your injury claims if you struggle to get the claim to your carrier/TPA.  Several Carriers now have a complete, customizable system to make this task easier on you the employer. 
 
In the past, if an injury occurred you would pick up the phone, call the carrier or your agent, and give them the pertinent information over the phone.  From there, those people would complete the injury report and the job would be complete.  Nowadays, the need for information has become more and more prevalent.
 
 
Different Ways Carriers/TPAs Should Accept Claims:
 
 
1. Email the claim info to the intake center
 
We live in a world of electronic communication.  This form is not only faster, but more efficient.  Carriers give their insured’s forms to complete, and then they can scan and email them to the intake email address.  This also gives the employer a copy of the information, so they can keep it on file. This is a fairly failsafe option, and very common in the insurance world.  [WCx]
 
 
2.   Fax an injury report to the carrier
 
If email is not your thing, most carriers will supply you with forms to complete and fax to your intake center.  This is a fairly easy task, but it can lead to some problems.  Because they can be written out by hand, faxing can make the print hard to read for the carrier employee to input into their system.  Even worse is when the employer does not complete all of the necessary fields.  This stalls the claim, because the carrier employee has to call the employer and confirm the information that they need for claim setup. Submitting claims via the fax machine is no longer the preferred option.  Carriers make it an option, but rarely will they prefer fax over the other electronic forms of communication.
 
 
3.   Call the injury details in to your carrier or agent
 
Even in today’s electronic world, calling in the claim is still a very popular option.  Calling the claim in is a bit more labor intensive for the employer, but there is comfort in actually talking to someone.  If requested, carriers will give you a dedicated phone line to call which goes right to their intake center.  Top carriers/TPAs will offer adaptable call scripts to ensure questions specific to your business are answered every time.
 
.
4. Submit the injury report via the internet
 
Most carriers can provide the employer with a secure website in order for the employer to report the claim.  This way the employer sees exactly with the intake employee would see from the carrier side, and if you do not have all of the information that the page needs you can always save your work and come back to it once you have the information that is needed.  This eliminates a phone call, being placed on hold, and repeating information to the intake employee.
 
 After you submit the claim you will receive a tracking number that is verification the claim was received and will be assigned to an adjuster.  This has become a common form of injury claim reporting and it has proven to be efficient. 
 
 
5.   Submit the claim information using intake software
 
As popular as website reporting has become, the new wave is giving the employer the software needed to report the claim direct and right into the new claim system the carrier uses.  Almost all carriers/TPAs use a type of claims software to handle their claims and intake process. To make themselves more integrated with their insureds they have allowed employers certain access to this software, including the ability to report a new claim.  This process has many benefits It has decreased phone calls for both parties, and it allows the employer to see into the claim and some of the claim notes to find out whatever info the employer is looking for, be it wage information, injury reports, loss runs, reserves, and the like.  The employer will not have access to the entire claim due to HIPPA privacy laws involving medical records, but they will have a lot of access for the most part.  This is the current trend, and more and more carriers are marketing this as a way that can separate them from other carrier competition. [WCx]
 
 
6. Key points to remember when submitting a claim
 
No matter how you choose to report the claim, you have to be sure of a few things prior to reporting.  Make sure you have all of the information the carrier needs, including date of birth, social security number, claimant address, injury details, wage history if applicable, the last day worked, the return to work date, if you have light duty work for this employee, the employer address and contact person, contact person information such as phone number and email address, type of injury, and so on.  Without all of this information submitted with the claim, the adjuster will have to contact the employer to obtain it.  No matter how insignificant the injury, these are all facts the adjuster will need in order to do a proper investigation into a claim.  A lot of times the insignificant claims are the ones that can turn into more severe claims when conditions warrant.
 
 
7. Key points to look for from your Carrier / TPA
 
·         24 / 7 reporting
·         Escalation Procedures for Critical Claims:  Critical losses require immediate attention, ensure your carrier/TPA has established procedures for once the claim intake is complete.
·         Immediate Distribution of Confirmation Letter: Necessary for you to confirm and acknowledge the information delivered during intake.
·         Integration with the Claims Management Process:  The intake process has to be integrated with the claims management process for the system to run on an optimal basis.  Any breakdown in this structure will lead to less than perfect results.
 
 
Summary
 
Having a streamlined claims intake process is not only beneficial to the employer, but also to the carrier as well.  By being able to have the information they need, the adjuster handling the claim can hit the ground running and work on ways to be proactive on the claim rather than being slowed down chasing information.  The first days in a claim are often the most vital, and any steps you as the employer can take are the most important.  You will see claim expense savings sooner by being thorough rather than by being complacent about the whole process. 
 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 


WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Filed Under: TPA and Claims Administration Tagged With: , , , ,

What To Do When Your Workers Comp Employee is Seeing Their Primary Care Doctor

July 10, 2012 by

 

Often times in workers comp cases, injured workers will go treat with a primary care physician, even if that is technically not allowed.  This is due to the fact that there is a negative stereotype attached to “clinic doctors” or what many workers call “the workers comp doctor.”  Contrary to popular belief, these doctors do not work for the insurance carrier.  Sure, these physicians may seem more aggressive than the primary care doctor, but that is for several reasons.  The most important one is being that they have no vested financial interest in obtaining a comp case as a long-term patient.  The old adage goes that “treating doctors get paid to treat”, and they like to keep the waiting rooms filled up day after day, and they do so by not being as aggressive as necessary. 
 
So what if the injured worker is able to skirt around the system and run to a primary care doctor?  Is the employer stuck with this doctor forever, and what can be done to keep the claim moving forward?  How should one go about getting the information needed for the claim? (WCxKit)
 
1. If this injured party has had prior treatment for this complaint with this doctor, be sure to request a copy of the chart and ask for all records.
Say this worker has had similar complaints of back pain in the past, and the records show that he did treat with this doctor in his past comp claims.  This means that with a signed medical release, the doctor should grant access to these records, and any other records that pertain to back treatment.  If this doctor has dictated notes, it can yield several clues of possible injury outside of the course and scope of employment. This of course is solid ground for a dispute on the case, since you the actual injury may not be related to the worker’s actual employment.  
 
Also included in the notes will be objective evidence of what actually is wrong with this patient.  If he has all subjective complaints, then that injury may not be as severe as the claimant is suggesting. The bottom line is gathering medical records can provide several medical clues as to what is happening and  will only help the case.
 
2.  How does this doctor relate this injury to the patient’s stated injury that arose out of employment?
The main key in any comp case is the causal relation statement.  This is where the doctor takes the subjective and objective complaints and evidence, and ties them back to the worker’s employment.  A lot of primary care docs that do not have a lot of comp experience will purposely be as vague as possible when it comes to this issue.  A common statement a doctor will make is one similar to “The patient did not have any prior complaints of injury other than something happening at work; therefore, it must be work related.”  This is not exactly true, since even though a person may be at work and have pain, it does not mean the work actually caused the pain or injury.  Sure, work can contribute to this scenario, but the adjuster has to get to the ultimate cause.  If a person has back pain, and there is a strain injury at work, it does not necessarily mean that the carrier has to pay for surgery that corrects degenerative conditions. Work may have exacerbated these pre-existing medical conditions, but it is a stretch to say that work actually caused the arthritis.  It is possible is a few circumstances, but overall the common result is admitting that work caused a temporary exacerbation of a pre-existing condition.

 
3.   If performing an IME or Peer Review that disagrees with the treating doctor’s causal relation, and the treating doctor disagrees with the IME doctor, how is that primary care doctor addressing this issue and what evidence are they using to solidify the opinion?
The second most common scenario is an IME doctor disagreeing with the primary care doctor’s opinion of causal relation. This is when claims will head into litigation, since there is a medical dispute about the origin of the injury.  We have seen a lot of treating doctors say they disagree with the IME doctor, but then they do not elaborate.  If this is the case, the adjuster will almost always side with the IME doctor, terminating medical coverage for this injured worker. In the occasion that the treating doctor makes an argument but still disagrees with the IME doctor, they may agree to disagree.  Again this helps the adjuster, because that adjuster will side with the IME doctor, and overall it will take a Magistrate to make the final opinion on which doctor they find more credible.  As the doctors are going back and forth arguing about who is correct, try to see what the treating doctor is using as the basis for the opinions.  It should be objective medical evidence, and not based on subjective complaints.  If it’s all subjective complaints, then that will only strengthen a suspension.

 
4.  Is the treating doctor providing medical slips and records on a timely basis to support the worker being disabled?
If the answer to this question is yes, then the adjuster must dig deep to find evidence contrary to what the doctor is opining. This can be in the form of prior injuries, auto accidents, surgical records, etc.  Try to find good solid evidence that the treating doctor does not know about, then submit it and ask if the opinion changes.  
 
If the treating doctor is not supplying the necessary documentation needed, then there are grounds to suspend treatment with this doctor until the documentation required is received to make a decision on the ongoing compensability of the claim. Most claimants will get frustrated if their treatment is suspended.  Their doctor may be telling them the injury is work related, but there is no supporting documentation to draw that conclusion. 
 
5.  Use of covers letters and nurse case management
After all of the attempts to gather the information needed, there is still a dead end.  So what to do now?  One option is to draft a concise cover letter to the treating doctor outlining concerns.  Doctors like to know what they have to address in comp cases.  Every doctor has a unique style when it comes to these issues.   The treating doctor may actually help a defense if you draft a neatly organized cover letter outlining the facts of the case with the questions concerning the compensability.  Since the adjuster is not in the room when this patient is being seen, who knows what the worker is telling the doctor?  Another way to confirm these facts is using an onsite nurse case manager. The nurse can talk to the doctor before and after the appointment, and can be very useful in getting the information needed pertaining to any medical documentation desired.  The nurse may not be able to actually be present in the room during the exam, but talking to the doctor before and after the appointment may help connect the dots between what medical evidence is showing, and what the patient is actually complaining of in regards to the injury.  Coming to these conclusions will only help the adjuster arrive to the proper decision on the compensability of the claim. (WCxKit)
 
 
Summary
If the injured worker is treating with a primary care doctor not familiar with the comp system, be careful and thorough about gathering information.  Be sure to put the time in on doing a detailed background investigation and pass that information on to the treating doctor, so they can see exactly what you are seeing.  This will help them make the correct opinion on the overall compensability of the claim.  If the attempts fail, utilize an IME and nurse case manager to help bridge the process. The adjuster can never have enough information when it comes to making the proper decision on claims.
 
 
 
Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.
 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 
 
WORKERS COMP MANAGEMENT GUIDEBOOK:  www.WCManual.com
 
WORK COMP CALCULATOR:  www.LowerWC.com/calculator.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.
 
©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.
Filed Under: Claim Management, Medical Cost Containment, TPA and Claims Administration Tagged With: , , ,

Not So Fast – Get All The Facts Before Accepting a Workers Comp Claim

July 6, 2012 by

 

Sometimes when an occupational injury occurs, it seems like a no-brainer that it would be an accepted workers comp claim.  The question often comes up when an acute injury occurs if the employer should ok the claim, even though there may not be details or information right at hand? The investigation that the adjuster performs can take several days to complete, if not longer, depending on the extent of the injury.
 
The idea of accepting a claim without prejudice will occur in certain jurisdictions more than others. It all depends on how the comp act is read within the jurisdiction where the workplace is located. Here are a few things to look out for: 
 
 
 

1.  The injury seems to be acute

If a worker drops a 50lb piece of equipment on their foot and falls to the ground in pain, it is quite obvious medical attention is needed.  Chances are this claim will be accepted as compensable without any major issues. It is possible that safety protocol may be to blame for the incident, but any defenses as an adjuster will depend on the jurisdictional statutes. Even in the most conservative states, the bottom line is if the worker is in the course and scope of employment and doing a duty that is of benefit to the employer, the claim is compensable. It maybe safe in this example to say the adjuster would OK the claim based on merit alone, but this is not always the case. The fact of the who, what, where, when, why, and how the injury happened may come into play later on in the claim which could lead to a suspension of benefits, or an overall denial.[WCx]
 
 
 

2.  The injury is witnessed

A lot of workers are under the belief that just because someone directly saw the injury happen it means claim will be compensable. This is not always the case. It helps to validate the claim, but that does not make it pass the criteria to make it compensable. I am not aware of workers comp laws in any state that directly say “If any injury were to be witnessed it is automatically compensable.”  A witness statement has to be applied and the validity of the claim determined on a case by case basis when it comes to overall compensability.
 
 

3.  The worker sustains a hernia, or herniated disc. Does that make it automatically compensable?

Of course it does not. If there are 50 people randomly selected out of the general public of varying age, a good percentage of those people may have disc problems, or umbilical hernias, that may or may not cause any noticeable medical problems.  The diagnosis of a hernia or herniated disc makes adjusters cringe, because there will now be a complex claim that will require a lot of medical investigation, and a lot of work to gather evidence to show why or why not that particular diagnoses is or is not occupational in nature.
 
 
 

4.  Investigation on the employer’s side of the claim points to the claim being compensable, so does that make it compensable?

No it does not. The employer’s investigation and opinion is only one aspect of the claim. There is still the employee’s story, the story of the involved witnesses, the medical story, and the legal support of the claim. All of these involved parties and the overall completion of the investigation of the claim will tell the story about if the claim will be accepted or not.
 
 
Sometimes there are claims where the employer’s investigation and the statement made by the employee point to potential compensability, but the medical aspect does not add up. Remember, all of the prongs of the investigation have to point to the claim arising out of the course and scope of employment and arising out of the course and scope of the injury occurring within the stated job duties that the employee was to be performing at the time of injury. If one of the aspects of the claim does not jive with the rest of the claim, the adjuster will file a dispute or suspension with the State in order to try and tie the case together. 
 
 
In the end, the burden of proof lies on the clamant to show how and why the injury occurred, and how and why that arose out of the course and scope of their employment.  The adjuster is not going to go out of their way to try and prove the case for the claimant. No one aspect of the claim can outweigh the other ones; they all have to correlate without conflict.  It is only then when a claim will be accepted as compensable. .[WCx]
 
 
Summary
The aspect of accepting a claim without prejudice is a risky one. An adjuster cannot accept a claim as compensable based on just one part of the investigation, or the presence of a certain diagnosis. The carrier has the right to stop or suspend benefits and coverage whenever coming across some evidence that may be contrary to what is currently known to be the details of the injury and how/why it occurred. The safe bet is to complete as thorough an investigation as possible, on all prongs of the case.  Those prongs being on the employer’s side, on the carrier’s side, on the medical evidence, and on the applicable legal statutes within the jurisdiction that has coverage.


 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 


WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Filed Under: Claim Management, TPA and Claims Administration Tagged With: , , ,

3 Common Mistakes Your Workers Comp Claims Adjusters May Be Making

July 5, 2012 by

As we often write about here on Lowerwc.com, adjusters are faced with many duties to perform every day.  Some of these tasks are simple and take minutes, while some tasks can take up the majority of a day.



Below a few easily overlooked items are discussed that can potentially lead to adjuster or carrier errors while handling workers comp claims.


1. The adjuster does not wait to get all of the medical records before deeming a claim compensable
Sometimes a claim can seem like a no-brainer. Case in point, a worker falls down at work and gets injured. This may be an isolated, witnessed event that results in a worker getting injured in the course and scope of employment.


But the medical records can show things to be contrary to what the initial investigation found. The worker did indeed report a fall with injuries right away, a coworker saw the employee fall, and the medical supports objective evidence of an injury. However, what did this worker tell the doctor?There are cases where an employee is injured as a result of horseplay, and some states that can make the claim not compensable. 


There was a case once where a worker did exactly this scenario. He worked the night shift and stated that his leg hit a cart and caused an ankle contusion. He had a coworker state the same, and all of the paperwork submitted with the claim supported those details.  What he did not say was that he told the Emergency Room doctor he was trying to flip himself into a rolling cart, and his leg hit the side of the cart causing the injury. In this particular jurisdiction, that was deemed as horseplay. After all, attempting to jump into a moving cart was not exactly in his job description! 
 

2. Accepting a case as compensable too soon
As a result of the above #1 item, the adjuster may accept the claim as compensable too soon. Most hospitals and clinics have a delay when the transcribed medical records are requested.  If all that is taken into account is what is stated by the employer and employee, the adjuster is missing one important piece of the puzzle, the detailed transcribed medical records. Just receiving a medical note or slip with the diagnosis and work restrictions usually is not enough for most adjusters. Part of a detailed investigation involves completion of 3-point contacts: The employee statement, the employer statement, and the complete medical record.


This is equally the case when dealing with a claimant that is impatient. Adjusters have several cases in the initial stages, and completion of an investigation can take some time. Just because a claimant is calling 10 times per day does not mean the adjuster should compromise the integrity of the investigation. If filing an extension is necessary for the investigation because the medical records are not in yet, then so be it. This is part of the job.

Claimants need to know up front that it can take some time. If the claimant is not satisfied with the time it is taking to get their medical records, then the injured worker can get involved by assisting the adjuster in asking the hospital to rush the records. After all the compensability of a workers comp claim is hanging in the balance. Frequently the hospital will comply, or at least move that case to the top of the heap so the parties can make a decision on the claim.
 
 
3. Adjusters pay medical bills without the notes attached
Sticking with the theme of medical records, a lot of clinics will just send their bills to the adjuster without the medical bills attached.  Significant over-payments can occur if bills are paid without knowing the services provided.

In jurisdictions where a claimant can treat with the claimant’s own doctor, be especially careful. This person could be going to the doctor for anything, and just because the bill lands in your inbox does not mean that it is automatically related to whatever work injury the worker may have experienced. Payment of these bills is considered “leakage” since monies are being paid on a claim when they should not be. If there are claims that have been around for many years, and are paid bills without the notes attached, then who knows how many bills have potentially been paid in error. The total could be in the thousands of dollars, and trying to recoup those monies from the provider can lead to a nightmare of phone calls. It is so easy to avoid this by making sure to know what is being paid for and how it is related to the work incident.


Summary
So there you have it, three scenarios where adjusters can make payments in error. This is not going to happen all of the time on every claim, but those claims are out there. More importantly those adjusters are out there making these simple errors every day. [WCx]


If you think that errors are being made on claims, then pick up the phone and ask for the claim payment log.   You should also ask for the claim to be audited by a manager or supervisor just to alleviate issues. Recouping monies paid in error is far more labor intensive than just doing what was supposed to be done in the first place which is handing claims correctly, and making payments correctly.
 
See our general article on Best Claim Handling Practices for an overview. 
 

 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 


WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com
MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Filed Under: Medical Cost Containment, TPA and Claims Administration Tagged With: , ,

Broadspire Donates $100,000 to the SOS Childrens Village

July 2, 2012 by

 

 
      
 
Broadspire, a Crawford Company and leading third party administrator of workers compensation claims, liability claims and medical management services, recently raised $100,000 for the SOS Children’s Village – Florida during its 2012 Charity Golf Tournament.
 
The second annual event, sponsored by 36 of Broadspire’s vendor partners, had record attendance, with 104 golfers enjoying a beautiful day on the course at the Diplomat Resort and Spa in Hollywood, Fla. Last year’s charity tournament, the first such event hosted by Broadspire, generated a donation of $70,000 for the village.
 
“Everyone at Broadspire is so proud to support such a worthy cause,” said Broadspire’s President and CEO Danielle Lisenbey. “The generosity of the sponsors and attendees was overwhelming. The event took a lot of work and organization and it has certainly paid off. It was a spectacular event and a spectacular success.”
 
Lisenbey recently presented a check to SOS Children’s Village interim CEO Debbie Levine at a ceremony at Broadspire’s offices in Sunrise, Fla. The Broadspire staff joined the staff of SOS and three children from the village, who presented Lisenbey with a thank-you gift on behalf of all the children who reside at the facility.
 
Broadspire began its partnership with the SOS Children’s Village as a part of Crawford’s Global Day of Service in 2009. Since then, Broadspire has helped with several fundraisers and volunteer opportunities. SOS Family Villages – Florida is home to up to 75 foster children who have been removed from their homes due to abuse, neglect or abandonment. The village setting allows for a nurturing environment where brothers and sisters, often separated in foster care, are reunited.
 
 
About Broadspire
 
Broadspire (www.choosebroadspire.com), a leading international third party administrator, provides risk management solutions designed to help clients improve their financial results. Broadspire offers casualty claim and medical management services to assist large organizations in achieving their unique goals, increasing employee productivity and reducing the cost of risk through professional expertise, technology and data analytics. As a Crawford Company, Broadspire is based in Atlanta, Ga., with 85 locations throughout the United States. Services are offered by Crawford & Company under the Broadspire brand in Europe (www.Broadspire.eu), including the United Kingdom (www.BroadspireTPA.co.uk).
 
 
About Crawford
 
Based in Atlanta, Ga., Crawford & Company (www.crawfordandcompany.com) is the world's largest independent provider of claims management solutions to the risk management and insurance industry as well as self-insured entities, with an expansive global network serving clients in more than 70 countries. The Crawford System of Claims Solutions offers comprehensive, integrated claims services, business process outsourcing and consulting services for major product lines including property and casualty claims management, workers compensation claims and medical management, and legal settlement administration. The Company’s shares are traded on the NYSE under the symbols CRDA and CRDB.
 
For more information, please contact:
Stephanie Zercher, PR director
404.300.1908 (office)
954.401.0230 (cell)
stephanie_zercher@us.crawco.com
Filed Under: TPA and Claims Administration Tagged With: ,

Why Worker Comp Litigation Stalls and How To Get it Moving

June 29, 2012 by

Litigation can happen in any workers compensation issue. Not on every claim, but if there is an aggressive carrier/TPA that denies cases, it will lead to legal hearings over decisions the adjuster made on the claim.

 
 
 
Some cases in litigation are more complex than others, all with varying personalities involved. Some plaintiff firms and adjusters are more aggressive than others. There are always many outside factors involved once a claim moves into litigation. The overall goal of the carrier/TPA is to end the litigation by paying out the least amount of exposure as possible. On the other side, the goal of the plaintiff is to net as much money or benefits as possible. This conflict in interests can lead to months upon months of legal “back and forth.” But what can stall out progress on litigation? [WCx]
 
 

1.  The employee is not realistic

Litigation leads to a lot of bitterness from the injured workers. They feel resentful about having to get an attorney to assist in getting “what is theirs,” including benefits, be it medical or indemnity in nature. Most of the time when the adjuster asks for a plaintiff demand on what could resolve the case; it is something that is unrealistic. Either the employee wants a big wheelbarrow full of money, or some medical treatment that the carrier does not feel is required to pay. Plaintiff counsel works for the client, the injured worker. Even if the adjuster puts forth a fair settlement offer, and even if the plaintiff counsel feels it is adequate and fair, the injured worker may reject it. Sometimes plaintiff attorneys have a problem controlling the client, stalling out litigation for sure. In the end a judge may have to decide what is or is not fair. Carriers hate to risk going to a judge, but sometimes it is the only way. Most judges will want the two sides to work it out among themselves, but it just cannot happen in every case.
 
 

2.  The employer wants to play hardball

The employee is not the only party to play with unrealistic expectations. Sometimes the adjuster is faced with an employer/insured who is just not reasonable, no matter how much the issues are broken down. Sometimes personal issues are intertwined within a workers comp case, and if the employer has a bone to pick with the employee, or an example is being made out of that person to scare off other employees from pursuing litigation, it will not help the case end quickly. The judge will have to become involved and this can backfire on the employer. At the end of the day, the adjuster has to get the authority from the employer to settle the case for a certain dollar amount. Even if it were to be a fair amount for all parties involved, the employer can always pull rank and steer the claim off track.
 
 

3.  The attorneys involved are not being proactive

A busy law firm has many cases, sometimes spread across the state in which there are cases on the docket. Super busy law firms with many attorneys just cannot make it to every legal hearing or mediation, which leads to that mediation being rescheduled. Quickly, 90 days can go by without anything being done on either side. This can be true of both defense and plaintiff law firms. And if the two busy sides are put together, the case is not going to be going anywhere anytime soon. It is the job of the adjuster to maintain the reins on the defense attorney, and force the issue to be addressed a timely manner. There are a lot of defense law firms who are willing to do whatever the employer requests, and if the current firm is having an issue with attendance, then something needs to be done right away. It is not allowable for the adjuster to just pass the case over to the defense attorney and let it go from there. When an employer starts to see a trend with ongoing litigation, sound the horn and become more involved. Lean on the adjuster to find out what is going on. Legal expense is not cheap, and employers should be paying for legal services that are acting in their best interest.
 
 

4.  The adjuster is not open to settling cases

Employers dealing with adjusters who are not settling cases have a serious issue. Sometimes cases are compensable and can cost a lot of money. The adjuster may not be willing or happy to accept this, but it is part of the job. If settling a case is an option to end exposure, and the adjuster is not being realistic and following wishes, then bring that up to the adjuster’s supervisor. The good news is, most cases in litigation involve the supervisor anyway. But everyone is busy, and sometimes the supervisor can overlook what is going on. It is hard to stay on top of every single case, so if there are some concerns on where the case is heading or how it is getting there, then voice an opinion. The adjuster and carrier work for you, and they are there to assist with these legal issues and to act in the best interest of an employer. If the adjuster is refusing to have an open mind and to accept the fact that all cases cannot be tried, then maybe a new adjuster is needed. Because in the end, it is the employer who will be damaged by a bad legal outcome. The carrier will move on, the attorneys will move on, and the employer needs to be comfortable with the way the litigated cases are being handled.[WCx]
 
 
Summary
Litigation is unavoidable. It will happen, sometimes more often with certain employers than others. But that does not mean that the litigation process has to be painful. Litigated cases need to be handled correctly, since one bad move can result in a lot of money being paid out unnecessarily. Keep the litigation moving, keep involved, and be prepared to handle litigation when it happens.
 


 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 


WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Filed Under: Litigation Management, Settling WC Claims, TPA and Claims Administration Tagged With: , , , ,

The Many Twists and Turns of a Workers Comp Claim

June 26, 2012 by

 

 
Every now and then when I meet people and tell them about my past work as a claims adjuster, I sometimes get a blank stare in return. The question that usually follows is “What the heck is that?”
 
 
True, before I got into the claims world years ago, I had no idea what a claims adjuster was.  When I took my first job in claims, the job description sounded interesting.  I had a background in Economics, and knew that insurance costs were a typical part of the financial structure of a business along with many associated costs. But that was about my total knowledge of that industry. I had no idea what a claims adjuster was, or what I would be doing day in and day out.  It sounded like being a detective of sorts, and I figured I would be investigating fraud and people faking injuries to try and get a big fat settlement. [WCx]
 
 
After my 3 week training course, and many years on the job experience, I discovered it was a lot more than just investigating potential fraud. There was the investigation part of a claim, the medical part, and the litigation part of the claim. But how do the adjusters handle claims? Is there a common blueprint that all claims use? And if so, are there any variations? Let us discuss the life of a simple workers comp claim.
 
 
  1.  The claim arrives at the desk of the adjuster.
When an adjuster receives a new claim, it is fairly common practice that the adjuster has 24 hours to make the 3 initial contacts: the recorded statement of the claimant, the statement from the employer about what happened, and a call to the medical clinic to obtain the medical records and to talk to the doctor (if needed). After these contacts are made, an initial decision can be made on the claim on compensability or not. The employer holds a large key here, as the employer has the eyes and ears about the claim’s potential issues regarding the causal relation and the overall compensability. Also important are the medical records, since they also will hold a large part of the background of the injury, and they will also shed some light on if this is an acute, objective injury or something that is more subjective and a little harder to relate back to the alleged work incident.
 
 
  2.  A compensability decision is made on the claim
At this point, after the contacts are made and the medical records are obtained, the adjuster will make a decision on the initial outcome of the claim.  If this was a fall that resulted in a leg fracture, this will more than likely be a compensable injury. Unless you uncover some major degree of horseplay or a very direct violation of a stated safety protocol, that type of fracture claim is probably legitimate. 
 
 
More subjective strain-like injuries, however, are often more difficult to prove.  People come into work carrying baggage from outside of work activities, and those claims can take longer for a causal relation to be established.  The worker will say that it is related to daily work duties. The employer may add some other details, such as the employee is known to be moving to a new house over the weekend, or helping a friend roof a house for example.  When this type of gossipy evidence is introduced, the adjuster will take a step back and probably file for an extension to be able to complete an investigation before making a decision on the overall compensability of the claim. Background checks, witness statements, and an IME may be needed at this point to try and determine what, if anything, is work related. 
 
 
2(a) Let us say the employer has nothing too bizarre to add. The injury is reported promptly and the injured worker goes right to the clinic. The injury is witnessed, and nothing out of the ordinary occurred.  For the most part, the claim will be deemed compensable and the worker will be paid wage loss if applicable, until returning to work or released from medical care without restriction.
 
 
2(b) Now let us say the employer did add that they know of some other inside,or outside-of-work circumstances that could have contributed to the injury. The employee may be upset over a recent performance review, and shortly after filed a claim for an injury. The injury is not witnessed, and the employee was doing something that they do not normally do as part of the job.  The story of the injury has now changed depending on who else the employer talked to on the jobsite, and nobody seems to be able to confirm what exactly happened or why. At this point, the adjuster will place a dispute on the file, and point out to the employee that there are some inconsistencies in the investigation of the claim, and a decision cannot be made on whether the claim is indeed work related or not. The burden of proof falls on the employee; it is their burden to prove how and why the injury occurred during the course and scope of employment.  It is not the adjuster’s job. 
 
 
3.  The Claimant files for a legal hearing or obtains legal counsel
So now a dispute is placed on the file, and the employee is not very happy. The employee visits an attorney, and the attorney feels that there is a solid case to start with filing for a mediation or a hearing. When the adjuster receives notice of the legal counsel retainer, a call is placed to the claimant’s attorney. Plaintiff counsels will vary wildly in how workers comp claims are handled. Some are very involved, and proactive, and some are not. The adjuster will explain why the case is being disputed, and report there is not enough clear evidence to show that this worker was 100% injured in the course and scope of employment. If an IME is performed, and in the favor of the carrier, the adjuster will forward a copy to the attorney for review. The attorney may file for the deposition of that IME doctor, to try and poke holes in that doctor’s medical opinion. But typically, cases that go into dispute attempt to be settled before any major litigation goes forward. The timeline on when a settlement can be made can take many weeks or months, even years, and during this time the claimant will continue to get medical treatment and accrue wage loss, which increases the overall value of their claim. A settlement will consist of a compromise of the medical and wage expenses, and usually will include the full and final resolution of the claim of all issues past, present, and future.  Again the time span on a resolution can take many months, if not a year or two depending on the extent of the injury. The settlement generally cannot occur until the worker reaches the healing plateau, or are fully released from medical care with no further medical disability. If the workers comp judge agrees to the guidelines of the settlement, an Order is signed. Then the adjuster cuts the checks to the necessary parties, and the claim is resolved. [WCx]
 
 
 
Summary
Between when the claim is called in, and when the claim is resolved, it can take many more turns other than what is outlined here. For the sake of brevity, we keep it nice and somewhat neat. However any claim can spiral out of control at any time, prompting the need for surveillance, vocational evaluations, job placements, several IME appointments, witness statements, and much more. The point we are trying to make here is that it is easy to say that all claims follow this road, whether accepted or not. Claims adjusters wear many hats, and workers comp claims can be very complex. Severe injuries can occur at any time, and know that the more complex the injury, the more complex the claim can be. Even if a claim seems to be legit on the surface, there are many factors the adjuster has to look at before a claim can be accepted as compensable.

 

 

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

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 


WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Filed Under: Claim Management, TPA and Claims Administration Tagged With: , ,

Things Your Workers Comp Claim Adjuster Should Not Do

June 21, 2012 by

 

Most states have an Unfair Claims Practice Act that basically outlines what the writers consider to be unethical behavior by the claims adjusters.  The large majority of adjusters is ethical and honest 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 that trap.  Unfortunately, occasionally the adjuster gets too personally involved in the insurance claim and makes a poor decision. (WCxKit)
 
 
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 support proof to do so
 
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 Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.
 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 
 
WORKERS COMP MANAGEMENT GUIDEBOOK:  www.WCManual.com
 
WORK COMP CALCULATOR:  www.LowerWC.com/calculator.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.
 
©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.
Filed Under: Claim Management, TPA and Claims Administration Tagged With: , ,

Selecting High Quality Third Party Administrator Adds Directly to Your Bottom Line

June 18, 2012 by

There are many programs a self-insured employer can implement to have a positive impact on the cost of their workers compensation.  Safety, aggressive transitional duty return-to-work, effective medical cost containment, and solid fraud prevention programs all will have a positive impact on the cost of workers compensation. 

 
 
The one area of workers compensation cost control that is frequently overlooked is the quality of the third party administrator (TPA) handling the claims.  All the savings from the safety, return to work, medical management and fraud prevention programs can be easily lost by the selection and continuation of a poor TPA.  If the workers comp adjusters at the TPA do not handle the claims correctly and efficiently, the cost of the claims will be significantly higher and will cost the self-insured employer far more than they might realize. (WCxKit)
 
 
 
The skilled workers comp adjusters who followed the established Best Practices for Workers Compensation claims handling will have substantially better outcomes financially then the adjusters who take short cuts.  Workers comp adjusters are human and when they are taught by TPA management to meticulously follow the Best Practices, they have great results.  When adjusters are taught to give lip service to Best Practices and are assigned too many claims by TPA management, the end result is the overpayment of claims.
 
 
If the self-insured employer selects their TPA by the lowest bid to provide their claims handling services, they may or may not get quality claims handling.  There are several measurements of quality the self-insured employer should look at in selecting and retaining a TPA from year to year.
 
 
Prior to making a decision on the selection of a TPA, ask all the TPAs submitting proposals to handle claims to submit a copy of their Best Practices for review. Eliminate from consideration any TPA who has vague Best Practices. Each of the Best Practices should state precisely what their criteria are and a time frame for accomplishment.  For example:  If the Best Practices state “will keep in regular contact with the injured employee”, that is marginal.  If the Best Practices state “will contact the injured employee the day the claim is assigned and after each doctor’s visit”, that is excellent.
 
 
Ask the TPA what is the average experience level of their workers compensation adjusters. Experienced adjusters tend to make fewer mistakes than inexperienced adjusters (and the self-insurer is the one who pays for the mistakes made by the adjusters, regardless of experience level).  Experienced adjusters know what to investigate, when to investigate, what to deny and when to settle.  They know the doctors, lawyers and workers comp boards.  They know how to move claims to a conclusion.
 
 
Experience of the adjusters is not the sole criteria.  Ask what the tenure is for the staff.  If the staff have had a lot of turn-over, there may be underlying problems in adjusters working for the TPA.  Also, turn-over and changing adjusters on the claims can have a negative impact on the outcome of the claims.
 
 
Ask the TPA for the average number of lost time claims assigned to an adjuster. If the TPA states the adjusters have on average 175 lost time claims, expect a poor outcome in most of the lost time claims.  If the TPA states it will vary by jurisdiction, by experience level, and by the number of litigated/board cases, you will have a much more sensible answer.  On average, an experienced adjuster can handle approximately 125 claims at a time, in a state with a moderate amount of state forms to process and in an area where most injured employees are not represented by an attorney.  If the state has complex forms and is highly litigious, for example, California, the average case load for an experienced adjuster may be only 100 claims. Much depends on practices and staffing within the claim office such as whether each adjuster has administrative support for obtaining medical records and pay bills; The more support provided to adjusters the more claims they can handle. 
 
 
Ask the TPA what their practice is in assigning claims.  If the TPA rotates the assignment of claims, the self-insured employer will end up with multiple adjusters working on the claims.  If the TPA uses designated adjusters (where the adjuster handles all the claims for the self-insured employer, plus claims for other employers) or the TPA uses dedicated adjusters (where the adjuster handles claims only for one self-insured employer), the self-insured employer will have a better overall outcome on claims as the adjuster(s) thoroughly learn the requirements of the account and know what is expected of them by the self-insured employer. (WCxKit)
 
 
Ask the TPA for a list of clients it services in the area.  If the TPA is reluctant for you to know its other clients or is reluctant for you to contact its other clients, that is a red flag.  If the TPA readily provides you with a list of clients, contact some of them at random and ask what their overall level of satisfaction is with the TPA.  Good references from other clients is a definite positive, while a polite refusal to provide any input on the TPA selection should be a negative, especially if other clients are also reluctant to give a positive recommendation.
 


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

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 

Our WORKERS COMP BOOK:  www.WCManual.com
 
WORK COMP CALCULATOR:  www.LowerWC.com/calculator.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.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact  Info@ReduceYourWorkersComp.com.
Filed Under: TPA and Claims Administration Tagged With: , , ,
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