Trinity International Corp., a holding corporation for 89 other and various companies, recently reduced incurred workers’ compensation losses by 79%; 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.
One of Trinity’s secrets in reducing work comp costs so dramatically was they actively involved their insurance carrier to help them return injured employees to their jobs. Containing the costs of workers’ compensation requires teamwork on the part of all parties involved. Trinity educated their broker, third-party administrator, insurance company and, more importantly, each of their companies so everyone understood the program and knew Trinity wanted employees back at work as soon as medically possible. It became known the corporation was willing to go to great lengths to place employees back into the work force, and their assistance in this effort was required.
Trinity redesigned its insurance program so all auxiliary services provided by outside vendors fit together into the company’s total program. The program is designed to be a vehicle for these services. Trinity also has implemented very detailed set of account instructions. The corporation approves all claims’ settlements, and written status reports on all claims over $10,000 are required every 30 days. The company follows other cost-cutting guidelines.
1. File Audits
All workers’ comp files are audited twice a year to develop a strategy to resolve not just to review each claim, These audits consist of face-to-face meetings between the company representative (usually the personnel director and general manager), the insurance company file adjuster, the insurance company supervisor, the insurance broker and the physician consultant. Meetings are followed up with a written strategy plan to ensure each party understands the action they’re responsible for implementing.
2. Investigation and Surveillance
Each accident is investigated in the plant immediately after it occurs, to determine the root cause and identify corrective measures. In addition, claims with “red flags,” or considered questionable, are investigated by professional investigators to determine whether the extent of the injury is legitimate or is being exaggerated.
Trinity recommends companies budget 5% to 10% of the total cost of the claim for surveillance.
3. Safety Management
No workers’ compensation cost control program is complete without an effective loss control program and an in-plant safety program. While Trinity has what it considers a good loss-control program, it also realizes there will be comp claims and management must be prepared to manage properly these inevitable claims. Trinity advises companies to utilize the services of their broker or their insurance carrier’s loss-control subsidiary or division, when available.
Also, employers should have loss-control inspections at every facility several times a year. Not only do firms review workers’ comp claims and safety procedures regularly, but also they need an active safety committee, a workers’ comp coordinator and a safety incentive program.
4. Performance Goals
Trinity measures program results in three ways.
1. OSHA Severity Rate: The company tries to keep the below 40/100, a formula derived by using the number of lost work days, depending upon risk or exposure. (workersxzcompxzkit)
2. Return-To-Work Ratio Goal: Trinity has an RTW ratio goal of returning 70% to 90% of injured workers to work within 10 days following an injury.
3. Cost Per Employee: The company strives to keep its CPE below $150 per employee.
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.
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.
ESSENTIAL: This article is Return-to-Work Essentials content.
