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You are here: Home / Medical Cost Containment / Success Story: Medical Cost Controls Helped Reduce WC Costs 60%

Success Story: Medical Cost Controls Helped Reduce WC Costs 60%

December 29, 2009 By //  by Robert Elliott, J.D. Leave a Comment

Trinity International Corp., (name changed) a holding corporation for 60+ companies, reduced incurred workers’ compensation losses by 60%; medical costs by approximately 50% and 99% of injured employees returned to work within 10 days. Trinity teaches its divisions to manage claims internally, returning employees to work as soon as medically able.

When Trinity reduced incurred losses by 79% at one location and by 84% at another, people wanted to know what Trinity was doing right. Trinity developed modified jobs for injured employees who cannot return to work at 100% capacity thus avoiding the curse of “psychologically disemployment.”

What is Psychological Disemployment?

The key to modified duty is to limit the duration of time away from the job to the period of time medically necessary. Research shows once a worker goes off on work comp and loses the all-important connection to the workplace, slowly the incentive to return to active, productive employment fads. The injured worker becomes used to staying at home, likes it and may eventually attempt to extend the duration of the absence.

When an employer provides modified duty (adding a cushion, providing a chair) to bring a worker back to work quickly, the worker stays connected to the workplace and co-workers, heals quicker and is in a better “psychological” frame of mind about work. Trinity found most job modifications cost less than $300. It’s a matter of being creative.

Using Documentation to Control Claims

Proper documentation is very important to maintain an organized program of injury management because the program requires constant communication with the employees, the doctors and the insurance company. To facilitate implementation and to avoid duplication of effort, Trinity provides each of its companies with many sample form letters suitable for various situations.

For small companies, this means putting together a set of comprehensive form letters of the required information, especially as it pertains to your state law. In addition to these form letters, Trinity also maintains an Employee Contact Log, so each contact with an employee or a doctor is recorded. Such a document makes it possible to substantiate company action in court or at a hearing.

Coordination of Medical Care

Proper and timely medical care is crucial to ensure the length of disability matches the length of absence. In many cases, Trinity found the original injury claim was legitimate, but the employee’s absence was extended unnecessarily.

To coordinate care, the company encourages constant correspondence and telephone communication with the doctors, physical therapists and chiropractors to ensure treatment is appropriate and provided according to a “treatment plan.” (workersxzcompxzkit)

Medical Provider Cost Containment

Medical cost containment for all workers’ compensation medical costs is aggressively managed to ensure the cost of care is appropriate and the duration and number of treatments are necessary. Trinity implemented these steps.

1. A medical consultant reviews each file.
2. Mandates compliance to a fee schedule.
3. Audits all medical and hospital bills.
4. Uses preselected “company” doctors.
5. Negotiates provider fees.
6. Conducts a precertification utilization review of all hospital admissions.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.

Podcast/Webcast: How To Prevent Fraudulent Workers’ Compensation Claims
http://www.workerscompkit.com/gallagher/podcast/Fraudulent_Workers_Compensation_Claims/index.php

FREE WC IQ Test: http://www.workerscompkit.com/intro/
WC Books: http://www.reduceyourworkerscomp.com/workers-comp-books-manuals.php
TD Calculator: www.ReduceYourWorkersComp.com/transitional-duty-cost-calculator.php
WC Calculator:
http://www.reduceyourworkerscomp.com/calculator.php

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

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

Filed Under: Medical Cost Containment, Medical Issues, Return to Work and Transitional Duty, Risk Management Tagged With: Medical Issues, Reducing Workers Compensation Costs, Return to Work & Transitional Duty, Return To Work Tools

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