Identify Real Cost Drivers in Post Loss Workers Compensation

Best Practices Approach to Post-Loss Costs Containment.

A solid workers’ compensation cost control program requires an employer to first identify the key cost drivers; i.e., those company-specific factors causing workers to stay out of work too long.

Many companies that take a hit or misidentify the causes of their workers’ compensation costs. They start by looking at what their vendors are doing, rather than at their own internal company practices. Employers need to follow a systematic method to diagnose the key real-cost drivers within their company, based on a best practices approach to post-loss (not pre-loss) cost containment. Employers would be wise to write an assessment of their own internal company practices to address post-lost costs containment.

 

Items to Consider Before Writing Your Assessment:

  • What can managers learn from an assessment?
  • What methods could assess a company’s workers’ comp process?
  • What are the benefits of each?
  • What areas should be reviewed?
  • Who should do the assessment and what are the benefits of each?
  • What should a company do AFTER the assessment?

After an assessment, employers need to decide the next steps in reducing workers’ compensation costs.

 

 

Do Not Wait to Take Action

 

Some companies wait until they are in serious trouble before taking action. They think of workers’ compensation as a cost of doing business and do not realize there are things they can do to control costs. Do not to have a perfect system in place before beginning. Often the process of doing the assessment is the start of the process of change.

 

 

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

 

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

WORKERS COMP MANAGEMENT MANUAL: www.WCManual.com

VIEW SAMPLES PAGES

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

 

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

 

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

 

To Fix What Is Broken in Your Workers Comp Program Have a Plan

Don't  Put the Cart before the Horse Any major organizational  initiative takes planning.  No one starts a major marketing campaign or does a total revamp of an accounting system without assessing the situation first and laying out a plan. So, why is it in the case of workers' compensation companies try to fix what's wrong without identifying the underlying symptoms.  Here's the "Cart"         An estimated 75%  plus companies go at the process backwards, putting the cart before the horse, by starting by reviewing their service providers and vendors rather instead of assessing the key problem areas in their own companies. But before you can choose new vendors, you must know your own program's strengths and weaknesses and measure the effectiveness of existing program elements.  Here's the "Horse" Just like a horse powers  a buggy, cost drivers power excess workers' comp costs.  Your "horse," which has to go first, is analyzing the problem and clearly identifying the cost drivers before trying to find a solution.  In other words, you must have a complete understanding of the  key cost drivers  at your organization.  And to expose the cost drivers, you need solid information, not guesses. You need to review  your internal workers' compensation management systems, your data, file-handling system and each vendor, such as outside medical service providers, investigators and the insurance company. You need to look  at both procedures and implementation. You say you have  great procedures?  Goody!  But, but, are they consistently implemented in a timely manner?  For example,  delays in referring claims to the insurance company and delays in an employee's return to work may be causes of higher than normal indemnity costs. Delays in referral of cases  to a physician reviewer may result in higher medical costs due to unnecessary requests for medical examinations. Consider, too,  your organizational structure, such as internal company reporting relationships and duties of managers who are responsible for workers' compensation. Basic information  about your company, the industry, number and location of employees, makeup of the work force, and type of work is essential. (workersxzcompxzkit) For example,  problems associated with "off-site" employees are different from those associated with employees who are located at a permanent site. Off-site employees such as delivery people, outside salespeople and construction crews, may have little or no supervision, use different transportation modes or be required to carry more tools or materials than employees working in a manufacturing facility. Author:  Rebecca Shafer, J.D.  consults for mid-market and national accounts focusing on project management, risk management assessments, data review, benchmarking, and development of Workers' Compensation and Injury Management Programs. Projects focus on development of training and education programs, document design, evaluation and integration of insurance claims administration and TPA services.  Contact her are:   RShaferB@ReduceYourWorkersComp.com WC IQ Test: http://www.workerscompkit.com/intro/ WCBooks: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php WC Calculator: www.reduceyourworkerscomp.com/calculator.php Follow Us On Twitter: www.twitter.com/WorkersCompKit

 
 
 
 
 

A NEW Article: Return to Work in Unionized Companies Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workman's comp issues.

©2009 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com

Top 10 Cost Drivers Tell Employers How to Fix WC Programs

In the 2009 RIMS Benchmark Survey, the ten areas of inquiry are taken from Workers Comp Kit to determine how well companies are “covering their bases.” These areas are: 1- Use of Resources 2- Claim Reviews 3-Post Injury Response Plan 4-Return to Work Policy 5- Medical Care Coordination 6- Performance Goals 7-Communication 8-Training 9-Fraud Reporting 10- Medical Cost Containment This groundbreaking action allows companies to now compare their performance to the risk management community. Employers can now compare their cost containment activities to other companies in the risk managment community. Author: Rebecca Shafer, J.D., can be contacted at: Becki@ReduceYourWorkersComp.com

Follow Us On Twitter: www.twitter.com/WorkersCompKit View the Entire Blog: http://blog.reduceyourworkerscomp.com/ Do not use this information without independent verification. All state laws vary.

©2008 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com

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Learn How to Reduce Workers Comp Costs 20% to 50%"Workers Compensation Management Program: Reduce Costs 20% to 50%"
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