10 Requirements For Employees Injured At Work

We tend to think of workers’ compensation cost containment programs as an endeavor best left to the employer, and while the employer must design the program, the employee has a role also.

 

 

10 Requirements For Employees Injured At Work

 

  1. Know what to do if they are injured on the job
  2. Sign an acknowledgement of these responsibilities
  3. Seek medical care from the employers medical provider (or their own primary treating physician if allowed by law)
  4. Keep the employer informed and updated of their condition/status
  5. Complete forms required by the employer truthfully.
  6. Attend weekly meetings to keep the employer informed of their condition and any obstacles to return to work full duty
  7. Participate in transitional duty (this must be a condition of employment).
  8. Attend all medical and rehabilitation appointments.
  9. Return to work in either transitional duty or full duty as soon as medically able.
  10. Other tasks as required by the employer and allowable by law such. Each state is different.

 

Remember, communication is the most powerful to gain buy-in and bring employees on board with participation in your workers’ comp management program.

 

 

Main Communication Message

 

“Our employees are our greatest asset, we are sorry one of our employees was injured, and we need your help getting them back to work.”

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

Denied Claim Zero MSAs: Still Available, But Put Through Wringer by CMS

In October 2016, CMS made an unannounced policy change which effectively eliminated the ability to obtain a Zero MSA approval from CMS based upon a complete denial of the claim, without a supporting judicial decision. After only a couple weeks, CMS withdrew this policy change and again allowed for approval of Zero MSAs based solely upon a complete claim denial. Nonetheless, these Zero MSAs reviews are placed through the proverbial wringer by CMS such that it is important to understand when a case meets the criteria for a Denied Claim Zero MSA and the documentation required to obtain CMS approval.

 

 

Denied Claim Zero MSA Approval Criteria

 

A Denied Claim Zero MSA (or Legal Zero MSA) approval from CMS is available when the claim has been completely denied with no medical or indemnity payments having been made with the exception of medical payments made for non-treatment purposes such as IMEs, case management and medical records copies (Note, in certain limited situations a Zero MSA may be approved with medical treatment payments having been made. Please consult with Tower MSA).

 

Importantly, CMS will not approve a Denied Claim Zero MSA if settlement is made final and/or a settlement payment or any medical or indemnity payment is made prior to CMS approval of the Zero MSA. A tentative or agreed to settlement is allowable, but please do not make the settlement final or make indemnity or medical payments prior to CMS approval of the Zero MSA.

 

If the case meets this criteria, then CMS has strict documentation requirements which must be adhered to or the Zero MSA will be rejected. Notably, since the policy change and rollback occurred in October 2016, CMS has added a requirement to provide claim reserve documentation. The requirement for claim reserve documentation, as well as all other supporting documentation, is detailed below.

 

 

Denied Claim Zero MSA Documentation Requirements

 

The following documents are required by CMS to obtain approval of a Zero MSA based upon a complete claim denial:

 

1. Claim Payment History

 

  • A claim payment history printout, even if blank, representing payments since the inception of the claim. All payments must be itemized.
  • Printout must be divided into categories for medical, indemnity and expenses with subtotals for each category and a grand total listed. Print or run date listed on the printout.
  • Date range for listed payments – Must be since inception of claim.
  • If the Claim Payment History does not meet the above requirements, then the following rules apply:

 

Provide a copy of the available Claim Payment History with the following statement inserted, signed and dated in the document:
This document provides a complete representation of all payments made on the life of the claim (including medical of $0* and indemnity of $0)

 

Signed:
Date:

*If medical payments were made, provide the invoices or reports, i.e. IME report, associated with those payments and see below Financial Detail and Denial Letter requirement.

 

  • Letter providing an explanation why a Claim Payment History meeting CMS’s requirements is not available (See below Financial Detail and Denial Letter)

 

2. Claim Reserves

 

  • A Claim Reserves printout divided into categories for medical, indemnity and expenses with subtotals for each category and a grand total.
  • Print or run date listed on the printout.
  • If there is a legal argument for claiming the reserve information is privileged then the legal argument, including citations to statute or case law must be provided along with a copy of a redacted (reserve information blacked out) version of the Claim Reserves printout.
  • If no reserves were placed on the claim, then a statement regarding the same.

 

3. Draft or final settlement documents and court orders or rulings or a statement that no such documents exist
(See below Financial Detail and Denial Letter).

 

4. First Report of Injury or a statement that no such document exists (See below Financial Detail and Denial Letter).

 

5. Financial Detail and Denial Letter – Tower MSA will provide draft letter upon request for submission of the Zero MSA to CMS

 

  • A statement indicating the claim was completely or fully denied with no medical or indemnity payments having been made.
  • If medical payments have been made for non-treatment purposes, i.e. IME, case management, medical records requests, then if the Claim Payment History does not properly explain the purpose of these payments, then provide an explanation for the payments.
  • If the available Claim Payment History does not meet the requirements under #1, then state that the carrier’s claim system does not have the ability to provide a Claim Payment History printout with the information requested by CMS, i.e. print date, subtotals for medical, indemnity and expenses.
  • If Claim Payment History did not meet the requirements under #1, then insert the requested information into the letter, i.e.list categories for medical, indemnity and expenses with subtotals for each category and a grand total.
  • If there are no draft or final settlement documents and no court orders or rulings, then a statement regarding the same.
  • If there is no First Report of Injury, then a statement regarding the same.
  • Letter must be placed on letterhead and hand signed.

 


6. Consent to Release form executed by claimant

 

While CMS places Zero MSA submissions based upon a complete denial through the wringer, these approvals remain available for workers’ compensation cases meeting the applicable criteria.

 

 

Author Rita Wilson, CEO, Tower MSA Partners, LLC. Rita serves as CEO of Tower MSA Partners, LLC. With more than 20 years in leadership positions in pharmacy software development and workers’ compensation managed care, Rita brings a wealth of expertise in information technology solutions and performance metric evaluation. Contact Tower MSA Partners at referrals@towermsa.com or (888) 331-4941

11 Simple Ways to Make Return to Work Part of Corporate Culture

It is critically important that management makes return-to-work programs part of the corporate culture. The employee’s expectations should be that if/when they go out on workers’ compensation, they will return to work immediately in some form of transitional work capacity. What are a few of the tools that can be used to make return to work part of the culture?

 

 

 

11 Simple Ways to Make Return to Work Part of Corporate Culture

 

  1. Talk about RTW in a positive way- never badmouth the jobs, the participants or the concept.
  2. Make RTW a positive experienceby finding productive tasks or jobs. Never have transitional duty jobs be punitive.
  3. Demonstrate the costof NOT doing it, and the savings OF doing it by showing it to employees in terms they understand and management in terms understood by executives.
  4. Incorporate RTW in all policies and procedures such asMedical Policy and/or Leave of Absence Policy, Wellness Policy. 
  5. Make it amandatory requirement of employment – so all employees expect to be treated in a similar fair manner.
  6. Holdweekly meetings to discuss obstacles to return to work – keeps employees “connected” and employers stay on top of the worker’s abilities.
  7. Send Get Well Cards for colleagues that are injured. Perhaps include a gift card to Papa Johns’s or a local restaurant or one that delivers with the card.
  8. Maintain the rules strictly and make them standardized.
  9. Show supervisors the cost savings and benefits (they have less retraining, for example).
  10. Don’t hesitate to use vendors that do on-site work hardening and RTW coaching.
  11. Include them in workplace activitieswhile they are recovering. Don’t forget to include them in meetings, events while they are injured. Once they are out of work they can easily become alienated and lose social contacts, so continue to include them in workplace activities even if they are doing a partial schedule while they work toward full duty.

 

These are just a few ways to make RTW part of your corporate culture. Start now, and take small steps. Stick with the program and gradually it will be accepted.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

 

8 Categories To Define Winning Workers’ Comp Litigation Strategy

Legal fees in litigated workers compensation claims can quickly become a significant part of the overall claim cost.  Fortunately, there are some very good ways to control legal cost without having a negative impact on the overall claim settlement.  The best time to establish control over legal fees is when the defense attorney is first employed; however, the best time to control the overall strategy of the litigation is before counsel is even hired.

 

Prior to hiring counsel, a fast track defense strategy should be established to ensure that appropriate actions are taken immediately upon notification of a claim. [The individual components of a fast track strategy are beyond the scope of this article.] The establishment of some basic ground rules for the legal fee billing before the attorney goes to work on the workers compensation claim will result in a measure of cost control without sacrificing the best possible settlement of the claim.

 

Litigation cost control is much more than negotiating the hourly rate and whether or not you will be charged for postage.  There are Best Practices for Litigation Management that should be utilized as a major part of your legal cost control.  The Litigation Management Best Practices can be broken down into easy to measure performance goals.  The following questions will assist you in determining if your current litigation program is controlling cost fully.

 

 

Defense Counsel Selection:

  • Is the defense counsel on your company’s list of approved counsel?
  • Is the defense counsel selected a law firm, or a specific attorney (preferably), within the law firm? Many carriers have an “approved list” of attorneys they use; this doesn’t necessarily mean those are the best attorneys or the most knowledgeable for your purposes, so consider their qualifications carefully and if you have another attorney you wish to use, discuss adding him/her to the list of approved counsel.
  • If the defense attorney is new to representing your company, has the attorney been provided the terms and conditions of the assignment?
  • Have they visited your operations, seen your products and know the basic requirements of the jobs within your workplace?
  • Have the reporting requirements been clearly stated?
  • Was a litigation budget request incorporated into, or attached to, the assignment letter?

 

The Answer:

  • Did the workers compensation adjuster refer the matter to defense counsel timely when an answer must be filed?
  • Does the employer provide the complete facts of the injury immediately such as how the injury occurred, photographs of the accident, information about weight of objects lifted, the employee’s application for employment, information about any prior injuries, prior claims, or prior medical absences. Having the employment file is very helpful.
  • Does the defense attorney have everything needed to complete ALL blanks on the First Report of Injury. Does he have the OSHA Report?
  • Does the defense attorney offer arbitration or mediation as an alternative to protracted litigation?

 

Initial Legal File Handling:

  • Are all medical and/or indemnity issues covered by the workers compensation policy?
  • Is the potential exposure on the claim evaluated correctly?
  • Is there an economic justification for a quick disposition of the claim?
  • Are there any statute defenses that need to be addressed?
  • Are there any unique aspects of the claim that could alter the outcome favorably or unfavorably?
  • Are all potential third parties noted?

 

Defense Counsel Acceptance:

  • Does the defense counsel send an acknowledgment of the assignment to both the workers compensation adjuster and to your workers compensation coordinator?
  • Does the defense counsel provide an initial review and evaluation report within the first 30 day?
  • Does the initial review offer alternative courses of action and the probable outcomes?
  • Does the defense counsel provide a detailed budget plan within the first 30 days?

 

Defense Counsel Staffing:

  • With the acceptance of the assignment, did the defense counsel specify who will be working on the claim?  (Unless the claim is extremely complex, the defense attorney, possibly one junior associate and one paralegal are all of the law firm that should be involved.  Multiple associate attorneys and multiple paralegals will add time [cost] learning the claim before being able to proceed with an activity).
  • Is the hourly rate for each of the law firm members clearly stated?
  • Does the attorney do work that should be done by the paralegal?

 

Budget:

  • Is the budget completely itemized?
  • Is research time included only for extraordinary issues?
  • Does the budget include the cost of any experts that will be retained?

 

Claim Handling:

  • Does the defense counsel make recommendations for any additional adjuster work that should be done?  (Defense attorneys are notorious about having the paralegals do the adjuster’s job of obtaining medical records and other documentation).
  • Does the defense attorney have the adjuster hire other vendors (surveillance, nurse case managers, vocational rehabilitation, etc.) or does the defense attorney complete the adjuster’s work?

 

Actions of Defense Counsel:

  • Is defense counsel avoiding the expenses of depositions and other discovery if it is the intent to settle the claim? Often, some discovery prior to settlement can reduce the amount of the ultimate settlement.
  • Is the defense counsel requesting only necessary depositions?
  • Is the defense counsel reporting significant developments timely?
  • Is the defense counsel reporting the progress of the claim at least every 90 days if the case is moving slowly?
  • Do the reports from defense counsel cover all pertinent information without repeating prior reports?
  • Does each report include an action plan to move the claim forward?

 

Hearings / Trials:

  • Is the hearing / trial date reported as soon as it is known?
  • Does the defense attorney provide a pre-hearing / pre-trial report at least 30 days ahead of hearing / trial?
  • Does the defense attorney provide a strategy for the hearing / trial?
  • Does the defense attorney timely request additional settlement authority when needed?
  • Does the defense attorney provide a timely update or report on the hearing / trial?

 

Legal Bills:

  • Is the amount billed for each activity appropriate?
  • Are the bills properly itemized with each activity being billed separately?  (As opposed to block billing where several activities are lumped together and one charge is given for all work done).
  • Do the legal bills follow the defense attorney stated course of action?
  • Are the legal bills in compliance with the litigation budget?

 

If you are uncomfortable trying to control the litigation cost or feel you need an expert to review the litigated workers compensation claims, please contact us for assistance.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

5 Reasons Your Employee WANTS to Return to Work

There can often be a negative connotation for those that are injured at work.  After dealing with thousands of claims adjusters can get jaded that claimants are up to no good and are only looking for a free paycheck.

 

A handful of bad apples can ruin it for everyone, but for the most part people just want to get back to their normal routine.  When injured, workers are usually in pain, receiving less money than they are used to, and traveling back and forth to doctor offices for examinations and therapy.  A revolving statistic may state that up to 10% of claims filed are not necessarily legitimate.  That leaves 90% just looking to heal and get back to pre-injury status.  Some injured workers even heal or return to work quicker than expected.  But why?  It seems obvious, but let’s explore some of the reasons in more detail:

 

 

  1. Loss of income

 

The biggest factor for an injured worker wanting to go back to regular duty is the income they receive.  There aren’t many people out there than can get rich off of receiving work comp pay.  Typically they receive a percentage of the income they are used to receiving, ranging from 60% to 80% of their net income.

 

Even in dual income families, this loss of income can be substantial, especially those that are living from paycheck to paycheck.  Do not be surprised when your injured worker is in a rush to get back to normal.  As long as a qualified doctor releases them to work with no medical restrictions, then you should be all set.  Of course this will vary on the injury.  I have handled cases when the claimant is adamant about making the doctor return them to work, and the physician will indicate in the notes that they are just retuning the patient back to full duty because that is what the patient requests.  You have to be very careful in this situation to avoid further injury, so if this should happen review it on a case by case basis.

 

 

  1. The claimant is bored if they are totally out of work and sitting at home

 

Sitting at home in an empty house with nothing to do can be even worse than light duty.  There is only so much daytime TV one can stomach.  It is no coincidence that most plaintiff law firm commercials run during the morning and afternoon, when injured workers would be home while disabled from work.

The vast majority of workers like working, or at least need to work for income, and even though sitting at home for weeks sounds great it is indeed not so great after a while.  It’s not like they can do whatever they want.  In fact this is what will land most workers in trouble, because once boredom creeps in they start to get outside and do something to take their mind off of being at home, and if you have surveillance on that certain day this can land a person’s case in suspension or denial due to them breaking their medical restrictions, whether it be on purpose or not.  I have seen a lot of injured workers say they just cannot sit at home any longer, and want to return to work.

 

 

  1. The claimant hates being involved with the adjuster and the carrier/TPA

 

Most claimants are new to being on work comp.  They have no idea what they are supposed to do, they do not like treating with the occupational doctor, and they hate sitting around and waiting on a paycheck to come in the mail that may take weeks to come once the investigation is complete.  In fact, I have had some workers that have had a legitimate work injury decline filing a claim under work comp, and choose to cover the bills from their medical care another way.  This is especially true if they have had a messy comp case in their past.  They are so jaded about how the process works that they will avoid it at all cost.  This is not necessarily the right thing to do, but the overall choice is up to the worker.  Realistically the carrier is not going to try and talk the injured worker into filing the claim.

 

 

  1. They think that a work comp case is going to be a litigation nightmare

 

Taking this one step further, some workers have heard horror stories about being on work comp, and being embroiled in a years-long litigation battle, with mounting attorney fees and a life filled with misery.  Sure this could be true sometimes, but not as much as the general public thinks.  Despite what the adjuster may tell them, we can’t make the worker pull the trigger and file the claim.

 

 

  1. The worker just heals faster than expected

 

Some people just heal better and quicker than others.  This is due to conditioning, genetics, the type of injury, the location of the injury, the severity of the injury, and so on.  If the adjuster thinks that it can take 6-8 weeks to heal from a back strain, and the worker is released to full duty in 2 weeks, this doesn’t mean that they are just in a rush to get back to gainful employment.  If the medical checks out, and the treating doctor signs off on it, then so be it.  Full duty is full duty. Adjusters should not hold this against a person just because they heal better or quicker than we thought they would.

 

 

Summary

 

There are many more factors to add to this article, but in my opinion the 5 above are the most tangible. This should prove that all claims shouldn’t be placed in the “bad” category.  Put yourself in the shoes of your injured worker.  Their money is not the same, they are in some sort of pain, their job tasks have changed, they are dealing with the adjuster and the carrier/TPA, etc.  They are in uncertain waters.  The common response to that is to get back to whatever they think is their normal life as soon as possible, so they can put this all behind them.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

 

Kicking the Opioid Problem: 5 Steps to Keep the Train Moving

There’s been some good news about opioid challenges in the workers’ compensation system lately. The percentage of new claims receiving opioids has decreased in recent years, as has the number of opioid scripts per claim. Several pharmacy benefit management companies have recently reported decreases in opioid use.

 

While the news signifies we are on the right track, now is hardly the time to turn a blind eye to the issue. Additional facts are that more than half of injured workers got an opioid script last year and of those, about half used them for at least 30 days, driving up costs for payers and leaving still scores of injured workers in states of extended disability or worse.

 

In order to keep heading in the right direction, the industry needs to stay up to date on the latest happenings and be vigilant in doing all we can to prevent opioid abuse, misuse and diversion.

 

 

The Latest

 

In terms of new regulations, the feds have joined the anti-opioid movement, with the Centers for Disease Control and prevention’s Guideline for Prescribing Opioids for Chronic Pain and a report by the Surgeon General, Facing Addition in America. States are implementing a variety of measures to try and limit opioid use for those truly in need; including formularies, prescribing limits, and other guidelines.

 

Sone of the latest developments in the opioid epidemic include the following:

 

Drug interactions.  In addition to the problems associated with opioids themselves, combining them with other medications can be fatal. Benzodiazepines taken with opioids can create a cocaine-like high for the user; however, they can lead to respiratory depression and heighten the risk of a fatal overdose. Also, some benzodiazepines are being used as muscle relaxers to treat spasms.

 

Long- vs. short- acting. Medical treatment guidelines, such as those from the American College of Occupational and Environmental Medicine and the Official Disability Guidelines do not recommend opioids as a first line of treatment for chronic pain. In those circumstances where opioids might be the best option, short-acting meds should be the way to go. Where a typical workers’ compensation claim might cost $16,000, short-acting opioids can increase that to $47,742, while long-acting opioids increase the average claim cost to more than $156,000, due to extended disability.

 

Abuse deterrent drugs. There are several medications approved as emergency treatment for opioid overdoses. Narcan, sold as naloxone is one of the main ones available. Three years ago, the government approved a self-injectable form, and in 2015 a nasal spray form hit the market. Called Evzio, the average cost is $3,380.69 higher than for the original Narcan products. The laws on the products vary among the states, with some allowing them without a prescription. While these medications are not typically part of a workers’ compensation formulary, use of them increased among injured workers by 50 percent from 2015 to 2016.

 

 

Prescription Drug Management

 

As an employer/payer, there are things you can do to maximize safe and appropriate opioid use and prevent abuse/misuse. Working with various partners, you can develop a narcotics management plan. Pharmacy benefit managers, insurers, third-party administrators, nurse case managers, providers and others should be involved. The plan should include several factors.

 

Provider outreach. Treating physicians need to understand and be on board with your plan. Those who are not may prescribe unnecessary opioids and should be excluded from your network in states with directed-care. The physician should use evidence based medicine as the standard of care. Providers, as well as pharmacies should be instructed to monitor the prescription drug monitoring program, depending on the jurisdiction. Opioids that are prescribed should be short-acting, for a limited time period and at a low morphine equivalency dose; the provider should conduct urine drug monitoring at an appropriate frequency; and should set up a ‘contract’ with the injured worker to identify rules related to opioid prescribing. Consistent and frequent communication with the treating physician is necessary to provide your support and ensure appropriate prescribing patterns are followed.

 

Patient education. Injured workers who may be prescribed opioids should be thoroughly informed about the risks vs. benefits. They should be made fully aware of the problems of long-term use of opioids, the risks from combing opioids with other medications, and the potential results of overuse.

 

Functional restoration. This should be the goal on which all decisions are based, to get the injured worker back to function and work.

 

Nurse Case Managers. Nurse case managers can be an invaluable resource to assess and intervene in certain claims. For example, they can assess the original diagnosis compared to the current diagnosis, check prescriber credentials, and make sure UDT and patient contracts are being used. They can do pain perceptions as well as psychological and functional assessments with the patient; create a functional outcome plan; and communicate consistently with the treating physician.

 

POS monitoring. Medications should be monitored at the point of sale and alerts sent when appropriate; for example, if a benzodiazepine is being purchased with an opioid.

 

 

Conclusion

 

Opioids are still the most commonly abused prescription drugs, as well as the most expensive and most often used therapy class. The workers’ compensation industry has made great strides in reversing the trend. But that will only continue if employers and payers are adamant in their efforts.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

Workers’ Comp Should Embrace Wearable Technology with Caution

They come in all types of gadgets. Wristbands. Watches. Eye glasses. They can be woven into your clothes. Or embedded in your jewelry. Or implanted in personal protective equipment.

 

These ‘wearables’ are small, electronic wireless devices capable of communicating with other devices and people. They allow for data collection and analysis in real time, and are increasingly being used to prevent injuries, aid recovery and expedite claim processing.

 

While wearables hold great promise for the workers’ compensation industry, they are also largely unproven, unregulated and possibly, unsafe. Employers can reap tremendous benefits from this emerging technology — if they understand the risks and how to mitigate them.

 

 

What They Are

 

Wearables are not new. There was the calculator watch of the 1980s, and before that, the hearing aid was a form of wearable technology. Things changed in the early 2000s with the introduction of the HugShirt. With its Bluetooth connectivity that allows you to send hugs via smart devices, Time Magazine named it one of 2006’s Best Inventions of the Year.

 

Since then, wearables have spread to many other applications. Consumers use wearable wristbands to monitor everything from their caloric intake and steps per day, to their sleeping patterns. The medical profession has embraced the technology to monitor patients by tracking their heart rates, physical activity, and blood glucose levels.

 

In our industry wearables are used to detect concussions in workers wearing hard hats, and monitor fatigue among employees wearing special wristbands. They are also used post injury to track the injured worker’s recovery and improve a catastrophically injured worker’s quality of life, such as the Exoskeleton that allows paraplegics to walk.

 

The data produced by wearables can help better coordinate and manage medical care and, ultimately help the worker and employer. However, much of the data being transferred is private and/or sensitive. Companies need to consider the unintended consequences involved.

 

 

The Risks

 

Individuals and companies can be harmed by the use of wearables in a number of ways.

 

  • Distractions. ‘Smart’ glasses can capture real-time facial images and videos, and search and post data on that person. But workers wearing them can be easily distracted, potentially resulting in accidents when driving or even walking.
  • While wearable wristbands are still all the rage, some users have developed allergic contact dermatitis.
  • Corporate security. Among the biggest concerns about wearables is the potential for a company’s proprietary information to get into the wrong hands. The devices can record private conversations, take pictures and share information online. Because they can be connected to smartphones, data can be constantly transferred wirelessly. The wearables can also be plugged into a computer via a USB port and introduce viruses into the company’s system. Also, the device could be used to download sensitive information. Currently, these devices often require no PIN or password, making it easy for someone to access its data.
  • The potential unauthorized access to employees’ medical and other personal information can be devastating for companies and workers alike.
  • Hacking. Employees with wearables may unknowingly have their devices hacked or controlled remotely.

 

 

Protections

 

Despite the risks, the use of wearables is expanding and shows no signs of slowing down. But there are strategies you can take to protect your workers and your company from the risks of this newer technology.

 

  • Vet the vendor. Before purchasing wearables, look carefully at the companies that supply them. Understand what needs you are trying to address and which devices will be most appropriate. Then look for a vendor that is aligned with your goals.
  • Seek buy-in. Money spent on wearables will be wasted if your employees don’t wear them. Work with your employees as you go through the process of determining which, if any wearables you want. Make sure they understand you won’t use sensitive data in any way that could harm them.
  • Establish policies. If your company has a policy for employee-owned mobile devices, include wearables in it. There should be rules for these bring-your-own-devices, or BYODs. If the policy is not broad enough, change the wording to ensure wearables are included. You should define the acceptable use of wearables and ensure employees understand and pledge to abide by the policy.
  • Monitor your networks. It’s important to continually identify when information is being sent over your company’s network and by what device. If an event does happen and you need to take down part of the network to repair it, you should have disaster recovery and business continuity plans in place that allows the company to resume normal functioning.
  • Check your policy limits. Does your insurance policy cover the risk associated with wearables? You may want to take a closer look and ensure it does.
  • Educate wearers. You want to make sure your employees use the devices properly and understand the risks involved to themselves and the company, and how to reduce them. Your insurer or TPA may have an expert available to speak with your workforce. If not, check local resources, such as the Chamber of Commerce.
  • Protect sensitive areas. If certain areas of your company have highly sensitive information, you may want to disable Bluetooth in them to reduce the chance of a data leak.

 

 

Conclusion

 

Wearables are the latest ‘disruption’ to the workers’ compensation industry. They can give you a competitive advantage if used appropriately and with the right precautions in place.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

5 Structured Settlement Scenarios You May Not Be Utilizing

A structured settlement creates a ‘win’ for all parties to a workers’ compensation settlement; the employer, the payer, the injured worker, and the attorneys. So when is the right time to use a structured settlement?  Conventional wisdom is that structured settlements should be used as a financial tool when the settlement value reaches an arbitrary number such as $100,000.  This business-as-usual approach has made countless workers’ compensation programs engage in practices that only drive up the cost of doing business and have a negative impact on their bottom line.  Now is the time to reconsider your approach as to the right time to use and consider a structured settlement.

 

 

What is a Structured Settlement?

 

A structured settlement is a valuable piece of a comprehensive claim settlement strategy.  The claimant will receive the full value of their settlement over a period of time via a combination of a one-time lump sum payment paid at the time of settlement, plus annual annuity amounts.  Structured settlements come in various forms and can include the following payment mythologies that meet a desired end.

 

  • Deferred Lump-sum Payments, which include larger than the regular periodic payments via a schedule paid at pre-determined dates;
  • Flexible Settlement Plan, which allow flexibility for claimants requiring various special needs; and
  • Period Certain Annuity, which typically include larger periodic payments that end at a date or age certain.

 

 

5 Structured Settlement Scenarios

 

 

1. Realizing Cost Savings in Low Dollar MSAs

 

Consider the scenario with a forty-six year old employee who is currently a Medicare beneficiary.  He sustains a low back injury, disputes arise in the claim, and litigation occurs.  The matter is ultimately resolved with an MSA allocation of $38,893.

 

Using a structured settlement in this case allows the insurance carrier to realize substantial savings.

 

 

Benefit Cost Guaranteed Yield Expected Yield
 

Cash to Set Up MSA

 

$2,357

 

$2,357

 

$2,357

 

Annual Payment to Replenish MSA Account*

$22,357 $0.00 $36,529
 

TOTAL

 

$24,714

 

$2,357

 

$38,893

 

* Settlement Based on CMS Approval Male, Date of Birth 9/19/1969 Rated Age: 50. $1,141.00 per year beginning 1 year from approvals, payable for 32 years, only if living

 

**Example provided by Ringler

 

 

Proposed Total MSA Amount:

 

$38,893.00
Cost of Seed & Annuity Payments:

 

$24,714.00
Savings Realized using Structured Settlement $14,179.00

 

Using a structured settlement relies on an annuity mechanism that guarantees a rate of return on the money invested via a life insurance program.  In this case, the workers’ compensation insurance carrier does not pay the full allocation amount.  Instead, they pay only $24,714 to fund the full MSA, resulting in savings of $14,179.

 

 

2. Alleviate Injured Worker’s Future Medical Challenges

 

Convincing the injured worker to settle can be a challenge. However, keeping the case open can often be much more problematic due to future medical issues. The insurance carrier’s Utilization Review guidelines must constantly oversee the medical care.  This often results in significant frustration from system friction, red tape, and denials of treatments and medications.

 

A structured settlement for future medical costs, working in partnership with a professional administrator, can give the injured worker the freedom to manage their medical treatment how they wish. The professional administrator sets up a dedicated bank account and gives the injured worker a unique card to use at his pharmacy and doctor’s office. The injured worker never touches the bill, receives discounts from bulk pricing, has freedom of choice, as well as security and peace of mind that his future medical issues will be handled appropriately and timely.

 

 

3. Bridge The Gap In Settlement Negotiations

 

Settlement negotiations often stall due to a difference in opinion on the value of the claim.  A common example is where the claims professional evaluates the settlement at $300,000, while the employee’s attorney, demands $400,000 to settle the claim. The claims professional and the employee’s attorney may be able to bridge the gap with a structured settlement.

 

A structured settlement bridges the gap with the injured employee receiving $400,000 while the insurer pays $300,000 (slightly more or slightly less) to be invested with a life insurance company in an annuity. This is possible with a structured settlement as the amount of the settlement is paid out over time with periodic payments. The injured employee and the employee’s attorney will receive the $400,000 over the time span set in the structured settlement (either the employee’s life time or a specific number of years).

 

 

4. Peace of Mind for Permanent Partial or Permanent Total Disability

 

Anytime an injured worker experiences a permanent partial or permanent total disability it creates an immeasurable impact on their life and that of their family.  In addition to ongoing medical expenses, the loss of the income raises questions about immediate needs, such as modified vehicle replacement and home modifications. There can also be additional concerns about long-term expenses such as college funding for children.  Structured settlements can be used to pay for these and other bills, providing a comfortable lifestyle for the family following a workplace injury.

 

 

5. Eliminate Contingency-Fee Attorney Income Peaks & Valleys

 

Many attorney’s work on a contingency fee basis resulting in significant peaks and valleys in income based on the outcome of their cases.  An attorney who leverages a structured settlement for their fees can set up a deferred compensation plan guaranteed to cover their annual operating budget, and freeing the attorney to focus on current and new cases.

 

 

Conclusions

 

It is rare that an injured worker — or anyone — has the money management skills and discipline to make a large sum of money last a lifetime, especially when there are medical issues to consider. In fact, research shows most people have depleted the entire lump sum after just 5 years. A structured settlement can give a guaranteed, tax free income stream for life.

 

Now is the time to reconsider your approach in how you are using structured settlements. A structured settlement provides the necessary “win” for all parties and can provide significant savings to every workers’ compensation program.

 

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

3 Prongs To Crystal Clear Workers’ Comp Investigation

Incident Injury Report Form Document Concept

Many employers miss a golden opportunity to control the cost of their workers’ compensation claims by failing to take appropriate action to investigate a workers’ compensation claim when it is reported.

 

 

Crystal Clear Employee Report of Incident

 

The employee should be asked to provide a written description of what caused the accident and to offer his/her opinion on how the accident could be prevented in the future.  The employee’s recall immediately after the accident is more complete and will be the more accurate then months or years later.

By having the employee document the accident details and the nature and scope of the injury, the employee is prevented from embellishing the details of the event later if he/she decides to capitalize on the injury by pressing for a higher than justified settlement of the claim.  Also, by having the employee specify exactly what body parts were injured, it limits the employee’s ability to bring in additional body parts at a later time.  For example – the employee fell and hurt his elbow. By having the written description of the injury from the employee, the employee cannot claim months later he/she also hurt her knee in the accident.

If the employee is manufacturing a claim, or even has a legitimate injury, the employee will be reluctant to try to expand the claim when he/she knows she has committed the details of the accident and the extent of the injury to a document that the employer has.

 

 

Witness Report of Incident

 

The written accident report of the employee is made more beneficial when the employer also obtains a written statement from each witness to the event.  The independent witnesses are an excellent source of information about the accident, and the extent of the injury to the injured employee. Beware of the accident that has no witnesses, or only a witness who is a close friend of the employee.

 

The information collected from the employee and the witnesses should be reviewed by either the employee’s supervisor or someone knowledgeable about the work process to verify the information provided is accurate.  The employee’s accident statement and the witness statements should be provided to the workers’ compensation adjuster, along with the First Report of Injury form.

 

If the employer has knowledge of a previous workers’ compensation claim, that information should also be provided to the adjuster.  Any information about accidents or injuries the employee has had in the past should be shared as well.  If the employee is known to participate in strenuous physical activities, sports or hobbies, that should be disclosed to the adjuster as well.

 

 

Adjuster Recorded Statement

 

If the adjuster has any reason to question the claim, the adjuster will often take a recorded statement from the employee.  The adjuster will be particularly interested in deviation of the accident details, or the nature and scope of the injury, from what the employee provided to the employer.  The adjuster in addition to inquiring about the accident details will ask the employee about any prior injury claims, any other accidents (for example – personal automobile accidents) and any prior injuries to the same body part (for example – previous back injury).

 

 

Properly Investigate All Accidents

 

The majority of workers’ compensation claims are valid and the employee deserves the medical care and indemnity benefits specified in the workers’ compensation statutes.  The investigation of the claim identifies those claims that are questionable or fraudulent and should be resisted.  The investigation also limits the ability of the employee of questionable character in exploiting the legitimate workers’ compensation claim.  We strongly recommend you establish the protocol of investigating all accidents.

 

 

For additional information on workers’ compensation cost containment best practices, register as a guest for our next live stream training.

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

 

 

7 Ways to Proactively Reduce Comorbidity Costs

As if managing workers’ compensation claims isn’t challenging enough, we’re increasingly seeing comorbid conditions among injured workers. We know that these health issues can increase the likelihood of workplace injuries and illnesses, and then add to the complexity and costs of managing a claim. The aging workforce means we’ll probably see more multiple comorbidities per claim in the years ahead.

 

Some jurisdiction, such as California, require employers to pay for treatment of a comorbidity if it hampers recovery. Even in states that don’t have that requirement, it still benefits payers to identify and address comorbid conditions that are present or, ideally, try to prevent them in the first place.

 

 

The Stats

 

The rate of claims with comorbid conditions per claim nearly tripled between 2000 and 2009.  These claims are more likely to include lost time and have about two times higher medical costs than comparable claims.

 

Obesity, addiction, mental health and hypertension are those with the greatest impacts on negative outcomes. Obese workers, for example, file two times as many claims as non-obese workers, have medical costs that are seven times higher, and incur an average 13 times more days away from work.

 

Diabetes has one of the lowest impacts on claims among comorbidities; and yet it is associated with increased recovery times, delayed healing, an increase in the likelihood of infections and other complications, and results in increased reserves.

 

When more than one comorbidity is present the increases are staggering.

 

  • 76 percent increase in claims duration.
  • 341 percent increase in total incurred costs.
  • 285 percent increase in temporary total disability days.
  • 147 percent increase in litigation rates
  • 123 percent increase in surgery rates.

 

Pre-Loss Strategies

 

Preventing chronic health conditions is the best way to avoid the challenges of comorbidities in workers’ compensation claims. There are a variety of actions employers are finding to improve the health habits of their employees, many of which are fairly inexpensive.

 

  1. Know your risks. All workplaces are not the same and the health risks facing your employees may be different from those of other organizations. You can assess and make decisions based on that. Health risk assessments are usually available through your insurer or EAP and can determine aggregate information on things such as physical activity, nutrition, weight and family history, without violating individual privacy.

 

  1. Wellness. These encompass a wide variety of activities. They may be formalized programs or just a few simple steps. For example, changing snacks in vending machines from chips and candy to fresh fruit, and sodas to water is one option. Bringing in nutrition and/or diet experts to talk with employees and, if financially feasible, create programs for workers is another idea.

 

Employees with sedentary jobs can be encouraged to move more, whether through gym memberships, group walks during lunch, or access to resources about community activities such as fun runs/walks. Weight management initiatives and smoking cessation programs can be done either onsite or within the local community and can help reduce the risk of a number of comorbidities. Finding internal wellness champions, or other workers who are devoted to the wellness plans can help generate interest among employees.

 

  1. Sit/stand options. The hazards of prolonged sitting are being increasingly recognized and have led some employers to invest in sit/stand workspaces. Employees can also be encouraged to stand more, by giving them the option to stand during meetings.

 

  1. Information. Tidbits to promote healthier habits can be provided via email, newsletters or educational workshops. Working with insurers and third-party administrators, or partnering with local medical facilities can be good sources of such information.

It’s also important to make sure your employees are fully aware of the health resources and programs that are available, such as employee assistance programs or specifics from your health benefits provider. Also, make sure you are taking full advantage of all resources available to you. You could also offer an anonymous ‘ask the expert’ initiative through you company’s intranet or internal newsletters. Someone from your insurer or a local medical professional could respond and the comments made available to your employees through internal communications.

 

Post Loss Strategies

 

The sooner you are aware of comorbidities in a claim the faster you can intervene with appropriate treatment and ensure best outcomes. Such knowledge also helps set realistic expectations for recovery and return to work. Be aware too that some comorbidities — such as depression — might not be present until the claim is in progress. There are several ways to identify comorbidities:

 

  1. Patient intake. Treating physicians and nurse case managers should be instructed to collect and record the injured worker’s health beyond just the occupational injury or illness, to determine if comorbidities are present.

 

  1. Monitor the data. Looking at data continually will signal if a new comorbid condition has developed. That allows earlier treatment of these conditions and may also signal a poor response to the treatment. In some cases, that could actually prevent litigation.

 

  1. Look at the meds. Pharmacy benefit managers should review medications to see if the injured worker is filling those prescribed and also determine if other drugs are being purchased that may interfere with them. Physicians should be instructed to access the prescription drug monitoring program, if one is available. Such information could signal the injured worker is taking medications for an undisclosed comorbidity.

 

 

Conclusion

 

When comorbidities are identified in a claim, all team members should become involved in a coordinated treatment plan. The treating physician, injured worker, claims adjuster, nurse case managers and others should work together to make sure the comorbid conditions are properly treated in conjunction with the occupational injury or illness.

 

 

For additional information on workers’ compensation cost containment best practices, register as a guest for our next live stream training.

 

Author Michael Stack, Principal, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Live Stream WC Training: http://workerscompclub.com/livestreamtraining

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

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

 

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