An Easy Way To Avoid Attorney Involvement In Your Work Comp Claims

A major mistake made by employers in handling workers’ compensation claims is the failure of the employer to build and maintain rapport with the injured employee. Wikipedia defines rapport as “when two or more people feel that they are in sync or on the same wavelength because they feel similar or relate well to each other”.

 

 

Employer Should Contact Injured Worker To Begin Caring & Trusting Relationship

 

The employer’s workers’ compensation coordinator should be in contact with the injured employee the day of the injury to begin to establish a caring and trusting relationship with the employee. By answering all of the employee’s questions about the workers’ compensation process and by showing the employee that the employee is important to the employer, the employee is much less like to develop animosity toward the employer over the accident.

 

Few employees will openly admit to themselves or to anyone else that it was their own carelessness that caused their injury. When there is no rapport between the employee and the employer, it is much easier for an employee to blame the employer for the injury, rather than to say ‘it was my inattention to what I was doing that caused me to get hurt’. When proper rapport with the claimant is established, the injured employee is much more objective about the cause of their injury.

 

When the workers’ compensation coordinator actively works with the injured employee to schedule medical care, to arrange light duty work, to answer any questions the employee has about the workers’ compensation claim process, and to reassure the employee that the employer has the employee’s best interest at heart, the course of the workers’ compensation claim is much smoother.

 

 

Fear Is Primary Reason An Employee Hires Attorney

 

Fear is the primary reason an employee hires an attorney following an injury. The employee can be fearful of one or more of the following concerns:

 

• The inability to support or provide for their family during the recovery time of the injury

• The inability to support or provide for their family in the future

• Losing their job due to their inability to work

• Being ostracize for causing the accident and the resulting injury

• Having a permanent impairment

• Having to pay the cost of the medical treatment

• Not knowing what to expect

 

It is often said the easiest way to lose control of the claim is to ignore the injured employee after the injury occurs. When the employer does not maintain rapport with the employee following an accident, the employee will find someone to answer his or her questions about the workers’ compensation claim process. If the person providing the answers to the employee is an overzealous attorney whose primary concern is maximizing the attorney’s income, the answers provided to the employee will be designed to drive a wedge between the employee and the employer. The attorney knows the employee may have some sense of loyalty to the employer, and it is important to the attorney to diminish that sense of loyalty, and to encourage the employee to try to get the maximum amount possible for the injury.

 

 

 

Communication Needs To Be Ongoing

 

Immediately following an injury, most employers reassure the employee that everything will be alright, that every problem will be taken care of. Unfortunately, most employers return to the daily activities of their business the day following a workers’ compensation injury, while the employee continues to deal with the injury aftermath for weeks or even months following the injury occurrence.

 

Rapport is maintained by regular, on-going contact with the injured employee. One of the Best Practice used by professional workers’ compensation coordinators is to request the injured employee to call in after each doctor’s appointment with a status update. This accomplishes several things:

 

• It keeps the employee in touch with the employer during the medical recovery process.

• It keeps the employer informed as to the exact medical status of the employee.

• It reassures the employee that the employer is concerned about the employee’s well-being.

• It allows the employer to coordinate the modified duty work with the limitations imposed by the medical provider.

• It keeps a high level of rapport between the employee and the workers’ compensation coordinator

• It allows the workers’ compensation coordinator to address any issues or concerns of the employee that develop during the course of the claim

 

When the employee has a high level of rapport with the employer’s workers’ compensation coordinator, there is a much lower chance that the claim will be contested. By establishing and maintaining rapport throughout the claim, the employer will experience a better overall outcome of the work comp claim.

 

 

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.

Workers Comp Errors Can Be Costly in More Ways Than One

When errors happen in the workplace, they can be financially costly to a business, especially if they go undetected.

 

Mistakes in workers compensation (claims errors, changes in a company’s classification etc.) can end up costing business owners countless dollars, even potentially putting them in the red.

 

 

30 – 35% of Businesses Have Classification Errors

 

As many accountants can tell business owners, a majority of workers compensation programs have an error rating of 30 to 35 percent as it relates to business classification. Business owners are advised to not use a single classification for their company. Instead, they should classify each and every worker individually and require proper classification.

 

Among the two typical workers compensation issues that end up costing a company more money in the end:

 

• Not estimating the correct projected annual payroll – In this case, when a business owner fails to properly estimate payroll at the start of the policy period, it will lead to additional premium.

• A change in business operations –Alterations to how a company is run can impact the classification of the business’ workers comp program. Anytime you are changing the classification of your company, remember such a move will alter your comp program.

 

 

An Example of a Costly Claims Miscue

 

A claims quality control auditor was puzzled by something seen on the initial workers comp claims audit file. After noticing something did not seem right, they were soon to discover that the initial error had also transpired to the next file, and the next file, and so on.

So, what was the mistake at the center of attention?

 

As it turns out, each claim file showed significant over reserving, some four to five times the amount of total reserves.

 

In this case, the claims office was under the guise of one of the top third party administrators (TPA) nationwide, though there was one curious exception in this case. The exception was the claims manager was an employee for the self-insured business. There were 40 workers, employees of the TPA, that reported via the line of command directly to the claims manager.

 

 

File Review Reveals $85 Million In Excess Reserves

 

In taking a look at the files presented, it was revealed that in the first instance where over reserving was caught, the individual filing for workers comp reported suffering a crush finger on the job.

 

Given the state where the injury happened had a chart for Scheduled Injuries for limbs, hearing and vision, the top limit the self-insured employer could offer on the claim per the Schedule of Injuries for the state was $10,220.

 

The indemnity reserve – that came in at $50,000. A back injury sporting a 10% rating had a $500,000 reserve. Lastly, an ankle sprain offered a $200,000 reserve. So, just what was going on here?

 

Moving on to interviews with the staff, it turns out the claims auditor discovered the claims manager was providing the reserve amount he desired for each and every indemnity claim. In a discussion with the claims manager, he stated he had been informed by his manager back at the self-insured employer to make sure adequate reserves were available for each and every claim.

 

During this investigation, it became all too clear to the auditor that the claims manager, the individual placed in charge of the work comp claims office, possessed only simple knowledge of workers comp. Each of the work comp adjusters came to realize the reserving was much higher than it should be, but were following the manager’s orders.

 

Moving along, the auditor realized that the gross over-reserving was in fact leading the self-insured employer to have a large excess of funds put aside for the workers comp claims.

 

While the company should have put aside a sum of some $25 million in reserves towards indemnity claims, it would turn out that they had more than $110 million in indemnity reserves. That large difference in finances it turns out had the self-insured borrowing funds to meet its other financial requirements in order to keep the company up and running.

 

 

CFO, Senior Managers in the Dark

 

From that point, the claims auditor in fact reached out to the chief financial officer to try and figure out why a self-insured business owner was over reserving each and every claim file by a wide margin.

 

Soon after bringing this to the attention of the CFO, the claims auditor discovered that the chief financial officer and all of those in senior managerial positions in fact were in the dark regarding the details of workers comp, along with the daily tasks of running the claims office.

 

When all was said and done, the claims office manager providing the CFO with data in turn was purposefully overstating the reserves for all the comp indemnity claims. Why was that the case?

 

As it turns out, the individual was just trying to show their boss what a great job they were doing.

 

The bottom line in all of this….claims reserves are nothing to toy with, especially in a day and age where many businesses are required to watch every dollar that comes and goes.

 

 

 

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.

 

 

Why Little Work Comp Claims Become Big Claims

Few things are as stressful to the risk manager as learning that a small medical only workers’ claim has morphed into a lost time claim. Often it seems that there is no warning that the small claim is about to spin out of control. Careful analysis of the medical only claims that transform into new lost time claims will frequently provide insight as to why they changed.

 

 

Failure to Obtain Medical Care

 

An injured employee who is concerned about losing time from work, or who does not know the employer pays for the medical care of on-the-job injuries, may elect to not go to the doctor. When the injured employee reports the injury to the job supervisor but then declines medical care, many employers will make an “incident only” record. This is the easy way out of handling a workers’ compensation claim, but this approach often backfires.

 

The employer should always encourage the employee to seek medical treatment “to be on the safe side”. Often with muscle strains, the injured worker keeps using the injured body part. The injured body part is susceptible to further injury and the minor injury becomes aggregated from further use resulting in a much more severe injury. A minor strain that could have been doctored by the local walk-in medical clinic and resulted in a week of light duty instead becomes a complicated injury with time off work and extra medical appointments.

 

 

Improper Medical Care

 

When employees select their own medical provider, they usually do not know how to select the best doctor for their industrial injury. The family doctor is fine for treatment of routine sicknesses, but normally has no experience or limited experience dealing with work related injuries. The family doctor will often tell the employee to “stay home” until he/she is well, and never think about the employer having a light duty work program available.

 

In approximately half of the states where the employer selects the medical provider, the employee should never go to any medical provider that is not on the employer’s posted panel of required medical providers. In the other states where the employee can select the medical provider, the employer should post a list of recommended physicians who are all experienced in occupational injury treatment. In many cases the employee will consult the posted list of recommended doctors.

 

 

Lack of Medical Triage

 

The triage nurse is responsible for recommending the appropriate level of medical care to the employee. When an employer (or insurer) does not have a triage nurse, the employer is left to determine the care, which nearly always defaults to the emergency room.  The employer also needs to explain the return-to-work program to the employee. It is up to the injured employee to describe his regular work duties to the medical provider, which more often than not will result in the medical provider keeping the employee off work.

 

 

 

Possible Fraud

 

When an injury is reported that just doesn’t seem right, even if the injury is reported to be minor, the employer should act without delay to prevent the injury claim from becoming a lost time claim. The employer should contact the medical provider immediately to explain the modified duty program, and reassure the medical provider that the employer will accommodate any necessary work restrictions the medical provider may feel are necessary (out of an abundance of caution). Frequently with a fraudulent claim, when the employee realizes that he/she is not going to get paid time off, the desire to pursue the fraudulent claim is lost.

 

 

 

Failure to Establish the Extent of the Injury

 

A mistake frequently made by both adjusters and employers is the failure to tie-down the exact nature and extent of the injury. For example, the injured employee hurts his shoulder lifting an object. If the employee has not been contacted by the employer, adjuster or a triage nurse, the employee is able to ask the doctor to treat his neck which has bothered him for years. While the shoulder strain would have landed the injured employee on light duty work, the shoulder strain plus the neck is enough for the doctor to justify keeping the employee off work. A detailed interview of the employee by the supervisor or the workers’ compensation coordinator, including the question “was there any injury to any other part of your body?” will head off the inclination to expand the claim to additional body parts.

 

We recommend employers to be involved in all of their workers’ compensation claims. By being involved in all claims, medical only claims will remain medical only claims and not be expanded to lost time 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, 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.

 

 

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.

Employers Wrongly Have Fear of Communicating Work Comp

Many employers don’t communicate with their employees about workers’ compensation benefits fearing additional claims. An informal online poll showed that 88 percent of employers and others involved in the claim process wrongly thought that communicating with employees caused them to file a workers’ comp claim.

 

Most injured employees don’t get an attorney because they want to get more than they deserve. Most employees call lawyers because of an inadequate level of communication between the employer and the employee. Plaintiffs’ lawyers say that injured employees call them because they cannot get answers about their benefits from their employers. When there is an adequate exchange of information between the employer and the employee, the employee might not see the need to hire an attorney.

 

Employers should create a workplace that fosters and expects on-going communication. The level and quality of communications will often make a difference in the final outcome of the workers’ comp claim.

 

Here are some ways that you can proactively communicate with your employees:

 

Employee Brochures

Having a clear and simple brochure about workers’ comp is an easy way to communicate with employees from their first day of work. A “What to Do in Case of An Accident” brochure should be posted throughout the work site and sent to every employee annually. Some areas that a brochure should cover are:

 

• What type of injuries are covered

• What type of benefits are available such as medical expenses, lost wages, medication and mileage

• How benefits are received

• Transitional Duty Programs

• Fraud control

• Who to call with questions

 

 

Safety Trainings

Keep employees informed of their responsibilities through safety trainings. Supervisors should reinforce these requirements through regular meetings and during safety plan trainings at the start of every new project. This injury prevention and post-injury response training is crucial to ensuring the best possible outcomes for the employee and the employer when an injury occurs.

 

 

Employer’s Communication Most Important

The key to good communication is the employer having a designated communication contact. This responsible employee serves as the primary contact point who takes charge of immediate contacts and keeps the communication loop flowing. Having one key, easy to reach contact person makes it much easier for an injured employee to keep in touch. Employers should not make injured employees make numerous calls to different departments or people to repeat the same information. The contact person should be patient and kind while an injured employee who may be in pain or shock describes unfamiliar medical procedures, medications and treatment.

 

All your employees, managers and supervisors must know the name and phone number of this key contact person. Make sure the key contact’s name and contact information is posted prominently in the brochure, policy manuals, workers’ compensation communications and employee bulletin boards.

 

 

Informal Communications

Informal communication includes telephone conversations and face-to-face conversations. Informal communications also include any voice mail or get well cards sent to the employee. These forms of communication should also be patient and kind so that the injured employee feels a level of caring and concern about their wellbeing.

 

 

During Recovery

The employer should remain in contact with the employee throughout the recovery process. The best way to do this is via a weekly scheduled phone call or having the employee call in after each medical visit. Some employers have on-site weekly meetings, if the injured worker is able, so that the employee continues to feel connected to the workplace and can sign any necessary paperwork. The information discussed in these contacts allows the employer to more easily respond to the injured employee’s concerns.

 

 

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.

 

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.

Three Critical Times Employers Should Seek Workers Compensation Advice

Work comp is a real time problem in progress. If you’re an employer, chances are you could use some, or much, advice. But advice often comes with an expiration date and, if not taken, will spoil faster than an open container of milk on July 4th weekend.

 

Employers who have been through the comp system tend to be wary of all contacts, which only seem to add to the costs without reduction of consequences. But those contacts are nearly always made when a claim has been in progress for months or years. Every comp lawyer has received a cry for help from employers, and employees, as a claim is near closing – hardly a time to do much except regret what was not done a lot sooner. Your correspondent not so long ago received a call from an employer 18 years too late and only after unnecessary payments, fines and penalties had driven him to bankruptcy.

 

 

Seek General Advice & Training in Present

 

So when is the best time for an employer to seek advice? There are three times, actually. The first is right now. The present is always the best time to get general advice and act on it. But be aware that no book, seminar or training can be so comprehensive that it will cover all the details of your actual claims. But it is a good place to start and a terrible place to stop.

 

 

Seek Advice Before Hiring

 

The second critical time to get advice is before you have made a decision to hire that last person you interviewed but you are still just a bit less than certain that it will be the right decision. You may be surprised to learn that your brain has become excellent at detecting patterns and should be regarded as containing a built in warning light. And, like all good warning lights, it should not be ignored.

 

Reach out and get a second opinion before committing to a hire. You may be comforted to now that it is not too late to ask a few more questions and dig for a bit more info before making a decision. Far too many employers hire next year’s claims and then remember why they felt nervous.

 

 

Seek Advice At Notice of Injury

 

The third critical point is, as might be expected, the most important. It comes when you have received notice of an injury or illness, whether or not alleged to be work related. This is the chance, perhaps the last chance, to perform what may seem to be simple acts but which, in fact, change the entire course and outcome of those situations which can become your worst claims. In this case, however, time is of the essence. There is no simple set of answers which can solve this problem. On the other hand, all your favorable solutions will be in the details – provided you learn what to do and how to do it.

 

 

What will you do?

 

If a disability is reported, but it is not yet linked to work activity, you can begin by being helpful AND carefully documenting your assistance. It will be invaluable if a claim is ever filed and more valuable if it prevents unnecessary claims.

 

If a report of work related illness or injury is being made, the first thing that must be done is to complete, with assistance from a qualified expert (yes, that means a comp lawyer), enhanced reports of injury.

 

An enhanced report, putting this briefly, treats the employer’s first report as a summary and table of contents, not the complete report. The most important entries will be “see attached” since this may be your last chance to get it right and enthuse your carrier to do the same.

 

 

What will be attached?

 

A short summary by you of the facts, in chronological sequence, that the carrier, lawyers and judges should know up front. No emotions or wishful thinking, please.

 

The final attachments will be those contemporaneous documents which support your list of facts.

 

If you follow the preceding, you will have fewer claims, smaller claims and lower blood pressure. But you need an editor to make sure your presentation is going to be effective. (Once again, it will probably be a comp attorney.) And you should make the cry for help before you start writing.

 

 

Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers’ compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100. medsearch7@optonline.net

 

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.


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.

Common Workers Compensation Assumptions And Facts

There are many assumptions surrounding workers compensation. Here are a few common assumptions and associated correct facts.

 

Assumption: There is nothing you can do to control workers’ compensation costs.

 

Fact: There are tried and true methods to reduce costs.

 

  • Management must have a positive attitude, developing creative ideas to bring employees back to work more rapidly. Returning employees to work as soon as they are medically able to perform any type of transitional duty job is a key to overall cost reduction.

 

  • Include your broker, insurance account executive, the third-party administrators (TPA) claims manager and a medical advisor in brainstorming meetings. Show how much it costs to pay for one workers compensation claim and the annual cost of workers compensation at each company.

 

 

 

Assumption: The best way to reduce workers’ compensation costs is to change insurance companies or TPAs.

 

Fact: The best way to reduce costs is to build a better relationship with your current claims administrator.

 

  • A lack of communication is a major cause of discontent between carriers and insureds. This causes a perception that something is being done improperly. For example, in one case a company believed that nurse case management was too expensive. However, an audit by a medical advisor showed that nurse case management services should be used more and be brought in earlier. It wasn’t effective when it was used, thus appearing expensive and wasteful, because it was used too late in the process.

 

  • Become more informed about your claims administrator’s services. Invite your TPA in with all of their services to a Vendor Day. Ask for samples of reports and deliverables to better understand their products and know when to request services. Have them give out brochures before Vendor Day so that you can ask knowledgeable questions about their services.

 

  • Visit a claims office to observe their processes. Find out if adjusters have backup and clerical support to get medical files. Observe the intake desk and the lost time and medical adjusters. Ask to see what happens to medical bills when they enter the system until the time they are paid and filed. This will give you a better understanding of how you can interact more effectively, what information adjusters need from you and what information you can provide about your workplace and employees.

 

  • Invite your adjusters to visit your workplace, so that they know what your company does and the types of jobs and skills required of employees. They cannot accurately visualize exactly how an injury occurred if they never visited your workplace.

 

 

Assumption: If you have unions, you’ll never lower your workers comp costs.

Fact:  Negotiating with a union can be successful.

 

  • Begin with a positive and cooperative attitude.

 

  • The need for a transitional duty program is usually facilitated by unions. Sometimes unions have creative ideas about how a new transitional duty program can work and they will inform you of collateral source benefits. In one case, the union was angry with management because management hadn’t tried to do more to stop several fraudulent claims.

 

  • Inform the union that staying out of work for long periods normally doesn’t help an injured employee heal. In fact, an employee may become depressed once the employee loses a daily routine and social network.

 

  • Focus on the membership’s economic consequences and interests. For example, if the majority of members are young, emphasize how the extra money helps them pay their children’s college tuition. If members are older, emphasize how the savings helps their retirement accounts.

 

 

Assumption: The best thing to do to move a slow claim is request an Independent Medical Evaluation (IME).

Fact:  Requesting an IME can be a double-edged sword.

 

  • If a claim is “stalled,” it’s common for adjusters to recommend getting an IME to get the employee’s status. Before a claim is sent for an IME, have a medical advisor review the claim.

 

  • In some cases, an IME may be warranted. However, sometimes a request makes it worse, such as when the timing isn’t right, when inadequate medical records are included with an IME packet or when inadequate medical questions are asked of the doctor performing the IME.

 

  • Consider a Functional Capacity Evaluation (FCE) instead or get a brief surveillance to see the employee’s actual capabilities.

 

 

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.

 

©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.

Workers Comp Claim Reporting Delays Will Cost You

 

The Longer You Take To Report A Claim, The More It Will Cost You

 

The longer you take to report a workers comp claim to your insurer or TPA, the more you run the risk of the claim costing more money.  This is due to a myriad of factors, the most important being that the sooner your adjuster gets the claim, the better they can control all aspects of what is going on.

 

Several online studies have shown a relationship between late reporting and increased claim costs, but it is hard to have a direct correlation.  This is because every claim is different, every person is different, every injury has different circumstances, and so on.  There is no blanket analysis applicable to just you, the employer.

 

I do however have a great example.  I came across some information from a Carrier where they did an internal study. It appears that they took the claims as they were, by associating reporting lag time with the costs on the file, in order to have something to show clients how reporting can be directly related to costs. This study encompassed thousands of claims, of all types of injuries, but the common thing is that they were all work comp claims.  The injuries were broken down by body location, injury type, and by claims that had litigation or not. I do not believe this was a report to be published, so the name of the carrier/TPA will be withheld, as will any other information which may point out to which carrier/TPA performed this study. Of course this study can’t apply to everyone, since this carrier has certain clients, of differing sizes, operating in certain states, etc., but it is one of the best examples I have seen.

 

Reporting Delay Study Findings:

 

  1. Injuries reported within 2 weeks of occurrence are 18% more expensive than those reported within 1 week of occurrence, and injuries reported between the 4thand 5th week following the injury were 45% more expensive.

 

  1. The biggest finding involves back injuries, which as a group are 35% more expensive if not reported within the first 7 days post-injury.

 

  1. Soft tissue strains and sprains are 13% more expensive if not reported within 7 days of occurrence.  For example, carpal tunnel injuries—whose onset are difficult to pinpoint in general—are 11% more expensive if the reporting comes after the first week of reporting.

 

  1. 22% of injuries reported within 10 days are litigated, and 47% becomes litigated when the reports arrive more than 31 days following the injury.

 

The most glaring statistic that I noticed was the litigation.  The more time that goes by post injury until the report is called in, the less likely the adjuster will have success in completing their comprehensive investigation into the claim.  Without that investigation, they are going to be less and less likely to accept the claim, as they cannot put all the pieces together to make a claim seem compensable. 31 days is more than 4 weeks.  Those 4 weeks are the most crucial time in a comp claim.  When late reporting occurs, witnesses, the claimant, and the employer all forget key details and elements critical to the claim. Even if the claim was compensable, chances are it will be disputed just based on the elapsed time.  Now, the carrier has to absorb legal costs, IME costs, and the ongoing battle of months-long litigation.  All of this could have been avoided had the claim been called in promptly.

 

The other statistics are fairly self-explanatory.  The more time goes on, the worse an injury gets.  The worse an injury gets, the longer it takes to treat.  The longer it takes to treat, the more it is going to cost.  Who knows how many surgeries could have been avoided had the claim just been reported within a few days after the injury occurred.

 

 

Reporting Delays Will Cost You

 

Although prompt reporting is only one of a number of management best practices to lowering work comp costs, it is an important one—if not the most important.  It is easy to ascertain that well-managed companies are more likely to report an injury promptly versus those employers are that less organized.  Keys to organization are the presence of a safety team, injury documenting procedures, and an action plan documenting what steps need to be done after an injury occurs.

 

The longer you wait to get a workers comp claim called in, the more it is going to cost you and your employee in the long run.

 

 

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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