Undocumented Workers Eligible for Workers’ Comp Benefits

In November, 2013 the Iowa Supreme Court ruled in the case of Staff Management v. Jimenez that undocumented workers can receive workers’ compensation benefits. Pascuala Jimenez, an illegal immigrant from Mexico, had two hernias while on a job assignment in 2007 through the temporary employment agency Staff Management. In January 2008, Staff Management fired Jimenez because she did not have authorization to legally work in the United States. In November 2006 the agency was notified through e-Verify, a federal program that verifies employment authorization, that her name and social security number did not match social security records. Jimenez claimed she was terminated because of her injury.

 

 

Undocumented Workers Do Not Preempt Workers Compensation Law

 

In July 2009 Jimenez applied for workers’ compensation claiming that her ongoing health problems stemmed from her initial hernia surgery. A workers’ compensation commissioner ordered Staff Management to pay for her medical expenses and future medical care. Staff Management appealed the ruling, arguing that Jimenez was ineligible for benefits because she was an undocumented worker.

 

The case eventually made its way to the Iowa Supreme Court. That court ruled that an undocumented worker is within the state’s meaning of an employee and that ”an employment contract with an undocumented worker does not inherently have an illegal purpose, and it is not void as illegal merely because the contract is with an undocumented worker.” The court further held that the Immigration Reform and Control Act, which makes it unlawful for employers to hire undocumented workers, does not preempt Iowa workers’ compensation law.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the 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, Principal, 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.

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

 

Selection of New TPA Is One of Most Important Decisions You Can Make

Whether you are just starting your self-insured claims program or have decided it is time for a switch to a new third party administrator (TPA), the selection of the new TPA is one of the most important decisions you can make in the administration of your self-insured program.

 

Employers switching TPAs often ask questions of potential new TPA partners that address the issues they have had with their current TPA. Employers frequently make the mistake of not asking the new potential TPA partner about areas where the current TPA performs well.

 

 

Areas that need to be explored with all potential TPAs before selecting the next TPA include:

 

  • Obtaining a copy of the TPA’s Best Practices to confirm their claim handling standards
  • Obtaining a list of the current clients and former clients to contact for their impression of the TPA’s abilities
  • Verifying the TPA has a claims office in each state where you have business locations
  • In large states, verifying the claims office(s) are located near your business locations
  • Verifying the TPA will assign dedicated adjusters to your account in areas where your claim volume is large enough to occupy all of one or more adjusters, and will assign a designated adjuster to handle all claims in locations where you have inadequate claim volume to keep one adjuster busy
  • Determining the claim reserving authority the adjusters will have
  • Determining the claim settlement authority the adjusters will have
  • Confirming the experience level of each of the dedicated or designated adjusters
  • Determining the frequency of the claim file reviews by the claim supervisors and the extent of the directions and guidance provided by the supervisors
  • Confirming the licensing of each adjuster and each claims office
  • Establishing the claims intake process
  • Establishing the maximum number of claims that will be assigned to each adjuster
  • Establishing who the legal defense firm(s) will be when defense counsel is needed
  • Establishing who the medical triage company will be
  • Establishing who the medical management company will be when medical management is needed
  • Establishing who the pharmacy benefit manager will be
  • Establishing who will provide the medical fee schedule reviews
  • Determining the capabilities of the claims management system used by the TPA
  • Determining whether your claims management system can be integrated with the claims management system of the TPA and who will be responsible for maintaining the systems integration
  • Verifying that the TPAs claim management system will be able to provide all the data and claim management reports needed to manage your claims programs
  • Determining who will be responsible for correction of data errors that occur
  • Determining the security measures the TPA will take to protect the confidentiality of your data and financial information
  • Determining the nature and extent of the financial data available on each claim file
  • Determining if the TPA data system will allow the creation of ad hoc reports
  • Verifying the TPA will allow annual independent claim file audits to verify compliance with Best Practices including the prevention of claim leakage

 

 

This list provides just some of the areas that need to be considered when selecting a new TPA. By addressing these issues during the TPA selection process, further problems with the new TPA can be reduced, if not eliminated.

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Never Give Up – The Mantra of an All Star Work Comp Adjuster

Too often adjusters will perform a background check, medical record sweep, or run an ISO sweep* early on in a file and then never do it again. Why not?

 

  • * ISO is a service provider offering a variety of products on statistical, actuarial, underwriting, and claims information. Services include being able to check for potential fraudulent claims in a large database of electronically filed claim information from participating insurance companies and third party administrators

 

Some of these cases go on forever. Things change. People move. New circumstances arise. Lots of things can happen during the course of a year. If you have a long drawn out litigated case, and you ran one ISO a month in to the file and you did a criminal/medical record background check a few months in, you are not doing your job.

 

Did you complete a medical sweep, to include hospitals, diagnostic centers, and pharmacies? Did you re-file the ISO every 4-6 months to see if there are any new matches? On those ISO matches you did find, did you talk to anyone at that carrier to see if they will share file details with you?

 

If not, again you are not doing your job. That’s sad, because this part of the job is supposed to be the most interesting. This is where you really sink in to a claim, by doing the background work and discovering new information to help your defense.

 

Here are a few tips to think about:

 

1. Call each carrier on all ISO hits; you never know what you might find. I have seen ISO matches that say “strain” and then I found out the injury was a 2-level spinal fusion. This is because when the claim is setup and the initial ISO is run, a strain may be exactly that. But as we all know, a strain can morph into a monster surgical claim. This is especially true in auto accident cases. There may only be room in the injury description field to write “Arm/shoulder strain”, and not enough room for “Broken leg, shoulder contusion, neck strain, whiplash, and closed head injury.”

 

2. Try to talk with a manager or supervisor to see if they will give you info about the prior claim. If you just send a generic fax or email over asking about injury or claim details, it is going to get deleted. This is because the adjuster doesn’t have the time to help you defend your claim since they are busy with their own claims. But a supervisor or manager may take the time to help you, and glance through the file notes to see if you have any matching dirt on a pre-existing injury. If you cannot reach a manager, try to find a colleague or vendor marketer to help you get in touch with someone that can help you. If you are referred by a mutual party, your chances for success more than triple.

 

3. Go back about 10 years in your background search to find out where your claimant has lived. Maybe they have moved a few times, from MA to CT to MI to TX. Once you establish where they have lived, now you can do your medical sweeps around each location where this person lived, and not just where they are living now. If you come up with some positive matches on medical record sweeps, use the signed medical release you have the claimant sign as your way to get prior medical records. I do not recommend to limit medical releases to something very specific. If it were a shoulder injury, I would try to put “Arm, shoulder, neck” on the medical release because this could help you later on. The claimant probably won’t care, especially if you explain to them that current pain in the shoulder could stem from a number of things, and you want to make sure that you can obtain current medical treatment records later on when they start to treat for other “conditions or allegations”. As we all know, extremity pain can come from a number of places, so try not to limit yourself by being too specific.

 

4. If your file is in litigation, subpoena everything you can. Even if a prior claim or injuries seem like a long shot, you may strike gold in a random primary care doctor medical record. If so, you are going to look like a hero, especially if your claimant talked about “Bilateral knee pain of unknown origin” to their doctor 5 years ago.

 

5. Keep sweeping every 4-6 months, and try different vendors to get a fresh set of eyes. Each adjuster has their favorite vendor for doing medical sweeps, and maybe you work at a carrier/TPA that has SIU services like these in-house. If this is the case, sweep often. If you are striking out, try a different vendor. They may have a different technique or have different database access than your vendor.

 

6. Update your ISO often. Each carrier may have different reporting standards, so don’t quit at just one search at the start of your claim. Plus, I highly doubt your claimant will tell you if they were in an auto accident a month prior to their alleged work injury. Or perhaps they were in what seemed like a fender bender while your claim is currently going on. They are not going to report it to you for fear of their claim being denied, so keep sweeping.

 

Remember your job is to continue to verify that ongoing disability is fully related to this alleged work injury. Just doing a sweep and then giving up is not doing your job. Everyone out there has a history, and the job of an adjuster is to dig up as much of that history as possible. You will not get fantastic results all of the time, but it a great feeling when you discover something that will change the course of the file because of not giving up and continuing to investigate.

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Poor Documentation Makes Claims Handling 100x More Difficult

File notes and goals are becoming extinct.

 

Realistically, the only way to move a file along is to set up goals and a timeline on when to reach them. Every adjuster hates this part of file handling about as much as they hate forecasting reserving for the life of a file, but similar to reserves it has to be done. Nobody said it was going to be a fun job!

 

Turnover is commonplace at Carrier/TPAs. So if you are a new adjuster to a desk, and you inherit 150 files (probably 250 but who is counting) the only way to really sink in to them is to first review the adjuster file notes. What if this prior adjuster was less than stellar at updating file notes?

 

 

 

Poor Documentation Makes Claims Handling 100x More Difficult

 

If this is the case, your job just got 100x more difficult. Everyone is guilty of poor documentation at some point, but there is a way around it. This would be the claim summary, the 60-day report, or whatever your carrier calls their “Claim review/goals/to-do list.”

 

This captioned report contains a history, an outlook, a to-do list, and a timeframe of when to get these goals done. This helps the supervisor when reviewing the file and it helps the adjuster to keep moving the file forward. But to be successful, you have to focus on certain areas. I have listed some of these areas below. If you are not implementing them already, you have to start now. It is going to make your life a lot easier.

 

The injury description and compensability decision—This is where you summarize what happened, why you accepted/denied the file, and the pertinent info on the claimant. This also includes claimant age, height, weight, pre-existing medical conditions, comorbidities, date of injury, hire date, job title, and so on.

 

Injury/treatment to date and what lies ahead—What treatment has been performed to date, and what will be coming in the future. This could be future surgery exposure, DME needs, physical therapy, RX usage, injections, diagnostics, nurse case management, attendant care, referrals to specialists, etc.

 

Issues and concerns or barriers to recovery—This is where you list the pre-existing medical conditions or comorbidities and how they relate/affect the injury. Examples include diabetes, smoking, body weight, prior surgeries, permanent restrictions that could affect the injured worker from returning to their regular job, etc. You can also include likelihood to return to work with light duty or regular duty, claimant attitude, and anything else you can think of that could negatively impact the file.

 

Litigation—Potential for litigation based on claim denial, or status of current ongoing litigation and what your plans are for the defense of the case. You should also include names and contact info of Defense/Plaintiff Counsel, the Judge or Magistrate, and vocational impacts if any.

 

Subrogation—In this field you should discuss if subrogation was ruled out and why. If you are going to pursue subrogation against a third party you need to outline who their carrier is, the response you have had to date, and the overall chances of success to recovery.

 

SIU/Surveillance—If you need these services in the future you should outline the plan of implementation. If you have already attempted SIU this is where you discuss the results and if you plan to order further SIU/surveillance later on in the file with target dates. You should also discuss results and the impact it has on the file defense. Also list the vendor name, contact info, and the dollar cost to date.

 

Long-term RX and medical treatment exposure—For those cases with long term exposure, you need to outline future monthly RX costs, the types of medications being used, if generics are implemented, are you using a Pharmacy vendor, and any other medical treatment needs in the future. This should also include future revision surgeries or more invasive procedures that could come in to play in the future affecting the overall direction of the file and the barriers they could play in file resolution.

 

Strategy for resolution with target dates—This will be your to-do list, and the dates you plan on having these tasks completed. This could be an IME, vocational evaluation, adding a nurse case manager, getting a MSA forecast, having a mediation performed on the file, etc. Include the month you want to have these completed by and what you predict the outcomes to be.

 

Reserves—Here you discuss current reserves for indemnity, medical, and expense and if you need to raise the current amounts to cover future exposure and why.

 

Medicare issues—In those cases with CMS issues, you need to document if you have identified the claimant HICN ID, if CMS has been notified, and the barriers you have to redemption with CMS being involved. Also included would be actual predicted MSA amounts or an MSA estimate from a vendor included in the file. Also if any vendors have been used be sure to list their contact information.

 

Simple use of an outline such as above will make your handling of the file a lot easier. This is because you are laying out the history, current status, and future plans in one document that you can easily modify in the future when the file comes up for review/discussion again. Doing this will not only help you the adjuster, but also your manager, and also if the file gets transferred to another adjuster they can hit the ground running right where you left off.

 

Failing to use an outline in the handling of the file can lead to missed opportunities, missed exposure, missed recovery, and overall poor file handling. This will negatively impact all parties involved in the file, the biggest being your insured account that you are trying to protect.

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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SUBSCRIBE: Workers Comp Resource Center Newsletter

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.


©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact mailto:info@reduceyourworkerscomp.com

 

 

 

Your IME Doctor Selection Can Make or Break Your Case

A common error I notice in work comp files are adjusters choosing the wrong IME doctor.

 

Sure this doctor may be a seasoned IME physician, but if you need something strong to stand up in a deposition and this IME doc is a known loaded gun for insurance carriers, then you may be in trouble.

 

 

Best IME Doctor is a Practicing Specialist

 

It’s not to say that this doctor is a bad one, they just may not be the best choice to uphold your defense of the file. For example, if you need a comment on a tough wrist surgery to see if the need for surgery is related to your comp case, using a general orthopedic doctor that no longer performs surgery or is not board certified may not be the best choice. You would want an opinion from a practicing physician that still performs many surgeries, possibly one that only does wrist and hand as a specialty, and is up to date on the latest techniques and practices.

 

This common error is usually due to adjusters not being familiar with their territory. They may be in another state, new to claims, or just have a common habit of letting the IME marketer choose the doctor for them, when the marketer may know nothing about the case. Later on down the road when this claim goes in to litigation, your defense attorney may cringe when they see your choice of IME doctor. This will hurt your own defense on the compensability of the case.

 

If your goal is merely to get a post-op employee back to work and all you need are work restrictions, than many IME doctors would suffice. A lot of times the treating doctor is hesitant to put their post-op patient back to work, based on the verbal history the claimant is giving them while at the appointment. If you have not educated this treating doctor on the light duty program your insured has, then you have little luck at a return to work light duty position. This brings in the need for the IME.

 

An IME is a valuable tool for the adjuster. To get the best outcome, you need to choose the correct one early on and stick with them. Other issues can arise such as MMI or to perhaps comment on other invasive treatment recommendations given by the treating doctor.

 

 

 

Use a Nurse Case Manager When Not Familiar With Area IME Doctors

 

I recommend using a nurse case manager in situations where you are not familiar with the area of the IME doctors. Chances are these nurse case managers have seen a lot of these doctors because that is the territory they work. The nurse is a great tool for not only helping you choose the right IME doc, but to also attend the IME, and to follow up with the IME doctor after the appointment to make sure all of your questions are addressed. Plus if the IME doc has questions about light duty or work duties in general, they can ask the nurse to get something in writing to help them, such as a job description.

 

You may not even need the IME if a nurse is on the file. They can hound the treating doctor with the same information, and get them to comment and save you the IME cost. But, if the treater refuses to comment, then you can come in with your IME and get those work restrictions you need.

 

For whatever reason, some adjusters just are not thinking about what path their file will take in the future. They could be quick to IME with their ultra-aggressive IME doc that they like, because this doctor only does IME exams and basically puts everyone back to work as long as they have a pulse and can physically get to work at their employer.

 

I blame this habit again on time. Adjusters are not taking a step back and really plotting out the future of the claim. They are overloaded with files, and just want their claimant back to work, so they use their IME hatchet doctor.

 

 

The Wrong IME Opinion is Not Worth the Paper It’s Printed On

 

What about 3 months from now when litigation starts, and your IME isn’t worth the paper it is printed on because that IME doctor has zero credibility? If your treating physician on the case is very well respected, and a specialist in the body part they are treating, you are in trouble.

 

I see this all the time. If your IME doc is a general occupational medicine doctor, and they are up against a well-respected specialist, that is not a solid defense. So take the time when you choose that first IME doctor. Look for specialists that still treat, still operate, and still are up to date on current techniques and trends. You will thank yourself later on when you have a solid medical opinion that gives you a real defense. Now you have an expert that can go toe-to-toe with any other treater in that field. That is properly helping to defend your insured against a costly claim they may not responsible for.

 

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Make Sure Injury Is Work Related Before Approving Treatment

The wise workers’ compensation adjuster during the initial investigation of the claim ties down the nature and extent of the injury. By limiting the medical treatment to the work-related injury that occurred, the adjuster prevents additional medical treatment for preexisting medical problems from being brought into the claim. In doing so, medical treatment is limited to what is necessary and due to the work-related injury.

 

The medical provider will obtain from the injured worker a description of how the accident happened. The medical provider assesses the nature of the injury and makes a determination if the accident caused the particular injury. For workers’ compensation coverage to apply there must be a direct relationship between the description of the injury and the medical diagnosis.

 

 

Second Injury During Recuperation Frequently Contentious Issue

 

The causal relationship between the accident and the injury is seldom a point of contention in workers’ compensation claims. However, when a second medical condition develops after an injury, the causal relationship between the original injury and the second medical condition is frequently a contentious issue that requires a significant amount of medical investigation by the adjuster. The simple fact that the second medical condition developed during the injured employee’s period of recuperation does not make the second medical condition compensable.

 

Examples of causal relationship medical questions that are frequently disputed include:

 

• An employee has an injury to a foot, ankle, leg or knee that creates an alter gait, causing the employee to have back problems

• An employee injures the dominant hand/upper extremity causing the employee to over use the other upper extremity resulting in strain/sprain to the non-injured upper extremity or shoulder

• An employee suffers a torn disc or a spinal herniation, causing pain and later develops fibromyalgia

• An employee suffers a hand fracture, has a very low pain threshold and does not use the injured hand which develops reflex sympathetic dystrophy

• An employee taking a prescription drug due to the injury develops a bad side effect from the medication

 

 

Request An Independent Medical Evaluation For Second Medical Condition

 

Any time a second medical condition is introduced into a workers’ compensation claim and the treating medical provider indicates there is a causal relationship between the original medical condition and the new, second medical condition, the adjuster should request an independent medical evaluation (IME) or peer review.

 

The IME doctor or the peer review doctor will need a significant amount of information to determine whether or not the second medical condition is related to the original medical condition. Included in the information that the IME or peer review doctor will need is:

 

• A detailed description of the accident which caused the injury

• A copy of all prior medical records for this injury

• A copy of all prior medical records, both injuries and diseases, of the employee for 10 years prior to the accident

• A detailed description of the employee’s job duties (never rely on the employee to advise the physician of the job duties)

Along with all documentation provided to the IME or peer review doctor, a list of questions about the causal relationship should be given to the doctor to answer. This includes:

• Is there medical evidence within a reasonable degree of medical certainty to establish a causal relationship between the original injury and the second medical condition?

• What is the medical rationale explaining the relationship between the original injury and the second medical condition?

• Was the second medical condition preexisting? Was it aggravated or accelerated by the original injury?

• Is the second medical condition permanent or temporary?

• Is the IME/peer review provider’s medical opinion conclusive or is there an element of speculation as to the causal relationship?

 

From the adjuster’s standpoint, the IME doctor’s or peer review doctor’s report needs to be conclusive on the causal relationship or lack of relationship between the original injury and the second medical condition. If the IME doctor’s or peer review doctor’s report states “could be related” or “uncertain” as to the causal relationship, the adjuster will be unable to properly accept the second medical condition, and it should be denied.

 

 

Detailed Investigation is Required

 

The determination of the causal relationship of a second medical condition is frequently resolved by the workers’ compensation board or industrial commission. It is imperative for the adjuster to do a detailed investigation into the medical relationship between the original injury and the second medical condition before accepting or denying the additional medical issue. If the employee’s treating doctor and the IME doctor disagree on whether or not there is a causal relationship between the original injury and the second medical condition, another independent medical evaluator agreed to with the injured employee is an alternative approach to a board decision on the issue.

 

 

 

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, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

WORK COMP CALCULATOR:   http://www.LowerWC.com/calculator.php

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

WC GROUP:  http://www.linkedin.com/groups?homeNewMember=&gid=1922050/

SUBSCRIBE: Workers Comp Resource Center Newsletter


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Why Train New Hires When They Will Just Quit Anyway?

To date, I have yet to meet anyone that planned on being a claims adjuster. Think about that for a moment. Not one person, over the course of years in this industry, has told me their main goal in life is to handle and investigate claims. Sure some have wanted to be in marketing or sales, or management of a large company, but none have stated specifically that they wanted to be in claims. Even those in the industry are dumbfounded as to why they are still there.

 

The biggest factor is those staying in employment as an adjuster is usually salary; at least in my casual conversations with claims examiners over the years. Second to salary is probably just general job security. Those in the know state that even new hires to the industry usually exit within a year, so it is good job security to be experienced in claims since there will always be an open desk somewhere at some carrier or TPA.

 

 

The Job of Claims Adjusting Is Too Difficult For Many

 

So why exactly does this happen? Sadly there is no one good answer. But there are a ton of general answers as to why so many people leave the industry. For example, the massive amount of phone work can be daunting to those without experience. Couple that up with insane claim loads, confrontations with angry claimants, numerous levels of management, frustration with the lack of authority and accountability with the claims you actually do handle, incompetent supervisors, and the list goes on.

 

In my humble opinion, the lack of effective training and mentoring is the biggest key factor in the revolving door. Having a structured program for green adjusters new to the industry would decrease those leaving the industry. Also to be successful you have to pair that on-the-job education with a real claims mentor that actually cares about the outcome and professional growth of the new adjuster. This is the problem—the training program may be there, but the actual mentoring and follow-through is not. On paper it is present and accounted for—meaning that some adjuster/supervisor is assigned to watch over the new guy—but the incentives to have them succeed is not. This is because the mentoring adjuster/supervisor is swamped with their own work and auditing demands and just doesn’t have the time to babysit the newbie.

 

 

Resources Are Stretched And Training Is Often Inadequate

 

Many organizations face the competing dilemma of a limited pool of experienced adjusters handling important high-exposure files versus the cost of their time and commitment of training the newbies. It is not that the spots are open and can’t be filled—you can always find someone looking for work that is willing to give claims a try. The problem is keeping them employed after you have run them through whatever you call your claims training program.

 

Even when companies raised the educational standard to accepting only new hires with college degrees, it doesn’t matter. The claims world is so niche that no real college classes focus on just doing claims. There are no labs or pretend claims office. No matter what the degree, new hires will always come in expecting the unknown. The mentor is the one that is supposed to bridge the gap between book-training about claims adjusting and actual execution of claims adjusting. If that caring mentor is absent in your organization, your new hire is doomed from the get-go.

 

A structured formal training program by itself is costly and complex, and most carrier/TPA companies have something in place that they think will be good enough to get the newbie off and running. But the decision of how much time, money, effort, and resources to invest into the claims newbie training program is where most executives face this crucial question: How much of their resources should they spend on someone that more than likely will exit the company within 4-6-12 months from their hire date?

 

This is where the vicious circle begins. Companies do not want to spend a lot of time and money on people that will not stay employed with them, and new hires say they leave the industry because they were not adequately trained or mentored.

 

 

More Organizations Need to Make Expensive Investment in Human Capital

 

How is this problem repaired? In a perfect world, organizations will finally realize that the more investment they make in their own human capital from the very start the more they will get out of it in the long run. New hires need to be trained, mentored, and assisted along the way to their own professional growth. This is not a cheap thing to execute. You simply cannot take a new hire totally green to this industry and magically transform them into a perfectly running claims machine in 6 months. This process takes years, and it is one of continued training and growth even after 10 years of being in the industry.

 

But this is not a perfect world. The reality is that the resources are not there, the mentors are not there, and the time is not there. Without those three keys working in harmony, the new adjuster you just hired could be out of your company before the ink dries on their newly updated resume.

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2014 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

We Are Getting Worse at Dealing with Back Pain

I was reviewing an article that was of no surprise to me: Insurance companies are getting even worse at dealing with back pain.

(http://archinte.jamanetwork.com/article.aspx?articleid=1722522)

 

Stop the presses! Yes it is true. Even if you still get your news from an actual hard copy of a newspaper, you must have seen at least one article about physicians failing to be proactive with back pain, especially when insurance injury scenarios are present. This is because doctors are really fantastic at making money. As long as there is a demand for care, doctors will continue to benefit.

 

Time for my normal disclaimer: Not all doctors are bad and trying to abuse the system. However, it seems that article after article is studying the ways that back pain was handled in the past, compared to how it is handled now.

 

Why is this? Well, if I am a marketer at a pharmaceutical company, I am not going to make much money unless I have some doctors on board with my products. In order to get them on board, I market my product’s to doctors, a lot of doctors. Maybe I choose to market to doctors who have a large workload of work comp care, or auto accident victims. Maybe I market to every doctor who will let me in their waiting room. Marketing is a numbers game. The more places you get in to, the more business you should eventually get.

 

 

Good Business and Good Medicine Often Conflict

 

But it is not just the marketers that are the problem. Due to increased litigation, depositions, injuries, and so on some of the doctors themselves have become part of the problem. Instead of dealing with treating the patient, all of the sudden the patient becomes in charge of steering care. They want Vicodin. They want an MRI. They want a CT scan. They want physical therapy. They want this. They want that. Since when did Joe Worker have “M.D.” after their name? In order to avoid conflict, the doctor is sure to please in most cases. This is because if they fail to do as the patient wishes, they leave the care of said provider and find a doctor that will listen to them and one that will give them what they want. As I have said before, if you have an empty waiting room you are a fantastic doctor and a terrible businessperson.

 

For example, going back to the article I was reviewing, acetaminophen treatment decreased from 36.9% in 1999-2000 to 24.5% in 2009-2010. But narcotic use jumped from 19.3% to 29.1% in the same time period. Not only is this ineffective, but the cost is insanely higher. You can get Motrin at any store for under $10 for a big bottle. Narcotics can cost in the hundreds per month, and those RXs are filled month after month after month, even when the patient tells the doctor that they are not helping.

 

The culprit is not just narcotic use. The study also notes that X-ray referrals stayed about the same, but CT scan and MRI use jumped from 7.2% to 11.3%. Depending on the jurisdiction you are in, an MRI could cost anywhere from $850 to over $3,000. Even when the clinical signs that warrant an MRI are absent, patients are still being sent for them, often at their own request.

 

In the past, you had back pain, you were prescribed an acetaminophen and sent for physical therapy. This is not always the case in present time. During the above-mentioned study, PT referrals remained constant, but physician referrals spiked from 6.8% to 14%. It takes time for a patient to get in to see specialists, and this stretches out the time they are out on work comp wage loss. It extends the life of the claim. Patients do not think that a primary care physician or occupational doctor is well-equipped enough to handle their “back pain” and they want to see an orthopedic surgeon. This is true even if the clinical signs do not necessarily warrant referral to a spinal specialist.

 

 

Adjuster Has Tools At Their Disposal

 

What are adjusters to do? Sure the patient is not an MD, and neither is the adjuster. But the adjuster does have a few weapons at their disposal in order to steer the claim down the right path before it gets out of hand. One of the most important tools is the Independent Medical Exam (IME). An adjuster can tell right away if the personality of an injured worker is going to be difficult. If a few weeks have gone by and the patient states they have no improvement, even if clinically they are much improved, an Independent Medical Exam should be set up. This tells the injured worker right away that they are not going to be the one in control of steering the claim.

 

Another great tool is the onsite nurse case manager. The nurse can talk with the doctor, to really find out why this referral is being performed, or why this worker is prescribed strong narcotics for a standard back strain. Injured workers know that the nurse is there, so they cannot be in control of getting what they want.

 

The third weapon in the arsenal is when the adjuster knows their doctors, especially in a jurisdiction where you can steer the injured party for medical care. You can stop the worker from running to their Primary Care Physcian right from the get-go, and get them in to your occupational doctor who you know proven to provide good care without prescribing Oxycontin for a week-long back injury.

 

The employer has a duty as well to help the overall process. The sooner the employer gets the claim to the carrier, the sooner an adjuster can become involved. The longer the employer waits to call the claim in, the worse the outcome. This is because the adjuster needs to step in at the beginning to stop an issue from occurring. Injured workers hear many fables about what you can and cannot do when a work injury occurs. The only person that knows for sure though is the adjuster. So as an employer, save yourself the time and expense and get your claims called in right away.

 

 

Control of Claims Needs to Be Out of Patient’s Hands

 

In workers compensation, you have to take most of the control away from the patient. Failure to do this will result in failure of claim handling. Doctors are increasingly doing what the patients tell them, instead of doing what clinically needs to be done. This won’t last forever, but for now if this is the trend, then it is time for the adjusters to stand up and take control of these claims. They are the ones paying the bills, and they are the ones who have to authorize testing and procedures. Adjusters are sometimes just as soft as the doctors, and this needs to stop.

 

 

 

Author Michael B. Stack, CPA, Principal, 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.

 

©2013 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 

 


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Is Your Workers Comp Claims Supervisor Being Held Accountable?

In a perfect world, everyone is held accountable for their actions. Not only in life outside of work, but inside of work as well.

 

When it comes to work, oftentimes there is a lack of accountability. Instead of being responsible, everyone points the finger at everyone else. For example, if a worker sustains an eye injury for not wearing safety glasses, the employee blames something else other than themselves. They say that the safety glasses are uncomfortable and not clear. Or they are heavy and not really feasible for some sort of machine inspection job they may have. The supervisor just blames the employee for not listening to safety protocol. Upper management blames the employee, again for not listening. Somehow the supervisor gets skipped over.

 

 

Supervisor Often Skirts The Blame Of Employee Injury

 

But the real blame is indeed the supervisor. Sure, the employee is the one not wearing the glasses, but, had the supervisor been doing their job the injury would not have happened. Now I can sympathize that a supervisor on a job floor probably has more tasks than just walking around and making sure everyone has their safety equipment on. But, it is also the supervisor’s main job to enforce the rules to the employees they are in charge of. The supervisor is the one that has to drill it in to the heads of the workers that glasses are a part of daily life in a machine shop, and there has to be punishment for those employees that do not want to listen.

 

Most times when these types of injuries happen it is with a block-headed employee that was warned before to wear glasses and not take them off. The first few times they were caught, nothing was done. The blame has to go to that supervisor. If the supervisor is having a hard time enforcing rules, then that person probably shouldn’t be a supervisor. If the employee was warned and disciplined and still will not listen, get rid of them and get another employee.

 

Injuries like this are behavioral in nature. Workers do not want to do something, so they do not do it. When they are caught violating a safety rule, little to nothing is done, until an injury eventually occurs. But if the injury happens and no punishment is laid out for either the worker or the supervisor, what was really learned? The answer is nothing. This person was not made an example of what can happen, and work goes on like nothing happed. In my opinion, both the supervisor and the injured worker should face some sort of discipline.

 

 

Safety Enforcement Has To Be Done

 

This is where your safety team has to have protocol as well. Simple safety enforcement has to be done. If you walk down on the job floor and catch people cutting corners on safety, then something has to be done. The easy way out is to just shake your head and say “Boy I hope that person doesn’t get hurt” but they will eventually. You know it is going to happen; it is just a matter of time. Hopefully it doesn’t result in someone losing an eye, or worse, but eventually it will. Maybe not today or this month, but it will happen. When that disaster happens, workers might straighten up for little while but they will fall in to old habits quickly and go on like nothing ever happened. This is because the supervisor failed to do their job enforcing safety protocol.

 

Transition this to a claims examiner atmosphere. The adjuster fails to make reserve changes on time, or fails to dispute a questionable claim for whatever reason. Instead of being disciplined, or retrained, little to nothing is done other than the supervisor keeping a closer eye on that adjuster. Over time that close eye will focus elsewhere, and that same adjuster is out there making the same mistakes because nothing was ever done. They are not retrained, or perhaps helped in some capacity. Instead the ball keeps rolling forward.

 

 

Action Plan To Correct Mistakes Needs to Be Implemented

 

This adjuster will make these same mistakes again, until finally the adjuster blows a high exposure claim. This is the equivalent of losing an eye for not wearing safety glasses. The adjuster will make enough mistakes to get the attention of some other higher-up types of management. But then who is held accountable? It will most likely skip over the supervisor and just go to the adjuster.

 

This is the pivotal key, that little to nothing will be done. You may take some reserve authority away, and keep a close eye on them while reviewing their files, but it is the behavior of the adjuster that needed to be changed. Why did this mistake happen, and what can you do to keep it from happening again? Does it come down to training? Is the adjuster overwhelmed and just not spending adequate time on the claim? Is the adjuster not experienced enough to be handling these higher exposure claims?

 

The answer could be anything, but the responsible party is the supervisor. They are the ones that are supposed to be reviewing claims for potential errors that are passed on as leakage to the employer or the carrier. The sad fact is that some managers out there are really bad at being a manager.

 

So it doesn’t matter what type of job you are in. You could be a welder, an adjuster, a secretary, etc. The supervisor is the one that has to drill home how the job has to be done, day in and day out. If this is not being done, and the supervisor is not being held accountable for their team, then it is time to find a new manager. If the manager has made several attempts at correcting the behavior and the worker will not listen, it is time to find a new worker, before someone loses an eye.

 

 

Author 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.

 

©2013 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Proper Compensability Investigation Stops Claim Before It Starts

Many rookie adjusters get ahead of themselves. This probably should not be seen as a surprise, because as a new claim examiner they feel pressure to not screw up. Messing up is usually viewed as missing some detail pertinent to the compensability of the claim. One of the worst mistakes you can make is accepting and paying on a claim that is not compensable to begin with.

 

A lot of this comes down to training. But when I was reading a recent poll, the top 3 core competencies were ranked as follows:

 

1. Disability/Return to work management

 

2. Medical Management

 

3. Compensability investigations

 

While I agree with the importance of the three items, I disagree with the ranking. I believe that these should be listed in the opposite order. Disability/return to work and Medical management need to only be addressed if the claim is actually compensable. How can compensability not be ranked first as the most important item in a claim?

 

It comes down to money. The medical aspects of claims can far outweigh the wage loss, especially in those chronic claims that are around for more than a year or two. Management and other executives focus on ways to save money on the medical end, by using aggressive management tactics to contain medical exposure. They assign certain vendors to their company, all in an attempt to curtail medical cost. They negotiate case costs, rates, assignments, and so on thinking that they are striking a deal and saving money on the back end of a claim instead of focusing on the front end.

 

 

Front End of The Claim Is Most Important

 

In my opinion, the front end of the claim is by far the most important. This is where the key investigation takes place as to if the claim is indeed compensable, or if any red flags are to be raised that can question compensability in general. Adjusters get lost in their routine of taking numerous statements and juggling their own pending claims that they forget that the first statement they take from the claimant is often the biggest key to the claim. All of their attention should be focused on looking for key indicators to compensability issues and not thinking 14 steps ahead as to which nurse case manager they will assign if/when this person has surgery 3 months from now.

 

These nasty habits begin early on in the career of said adjuster. It is very typical of an adjuster to establish a routine for their claims early on in their career, and rarely will they deviate from that routine unless they are forced to later on. Even when they are forced to change later on it is met with a ton of resistance, because you are changing the way they approach their claims from day one. Even with a forced change, they will slip back into old routines easily, unless you spend countless hours drilling them with reasons why they need to adapt to the new protocol for claim investigation starting at the time the file first hits their desk.

 

 

File Transferring Adds to Lack of Compensability Investigation

 

Another issue with the lack of compensability investigation comes from files transferring from adjuster to adjuster, either due to reserve increases or due to general adjuster turnover. Oftentimes the new adjuster will take the initial investigation as over and done with, and they pick up the claim where the prior adjuster left off. They should be using their experience in the industry to review the file in-depth, starting from day 1 of the claim, including listening to the recorded statement (If one was taken) and reviewing the notes that were input into the claim to see if anything strikes them as being odd or standing out as a potential red-flag issue. Compensability can always be addressed later on in the claim, but the chances you have to curtail what you may have to pay for can be restricted. If it were early on in the claim, the adjuster has several options to file to investigation extensions or to dispute questionable forms of medical treatment.

 

The reasons for these issues also come down to effective time management. It is not a recent news update that carriers are trying to do more with less staff, and these in-depth claim reviews and analysis just do not happen. The above mentioned poll shows flat out that compensability is not the first hot button issue on the minds of insurance executives. If the management is not pushing that issue, it is just not going to be done. Instead of stopping the claim due to prior adjuster error, examiners and management go in to damage control mode. They try to cap as much future exposure as possible, in order to stop the bleeding.

 

Maybe had they viewed initial investigation as being the most important step in a file they would not be in the mess they are trying to contain.

 

 

Author 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.

 

©2013 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

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