Effective Handling of Medical Only Workers’ Comp Claims

Medical only workers’ compensation claims are sometimes viewed as being unimportant and routine. This mindset can cause issues and lead to larger problems within a claim management team. If left unchecked, it can significantly impact the ability of a claims team to handle a large number of claims and not settle workers’ compensation claims in a timely manner.

Medical Only Workers’ Comp Claims – Defining the Issue

Medical only workers’ comp claims are those that involve an injury where the employee only receives medical care and treatment, or the wage loss is confined to the “waiting period” under a workers’ compensation act. In these claims, the employee’s medical care and treatment may be as short as one office visit, or as long as several years. The important thing to remember is money is being spent and the claims need to be properly managed.

Avoiding Pitfalls in Medical Only Workers’ Comp Claims

Members of the claim management team that work on these claims are generally newer claim handlers with less experience. The work may be monotonous, but it is still important. Members that are working these claims should pay close attention to detail, which includes the following issues:

• Ensure the injured employee receives prior authorization when necessary to receive medical care and treatment;

• Understand requirements as it released to applicable medical treatment parameters and fee schedule payments; and

• Review applicable claims to ensure managed care protocols are followed, if applicable.

This process also requires the claim handler sets the proper reserves on a claim. In order to accomplish this goal, the claim handler needs a complete understanding of workers’ compensation protocols. It is also important to ensure the employee remains gainfully employed to avoid exposure for indemnity and wage loss benefits.

Move Cases Forward – Not Letting Dust Settle

All members of the claim management team need to act in an honest and ethical manner. This includes treating the injured employee with respect and dignity. All payments should be made when legally required. The importance of properly handling medical-only claims is echoed by a National Council on Compensation Insurance (NCCI) report that found the following:

• About 80% make the transition within 12 months of the date of injury;

• Medical-only claims that become lost-time claims cost an average of 40 times more than those that remain medical-only;

• Carpal tunnel claims are the most likely claims to transition from medical-only to lost-time, with the probability of such a transition being approximately 34%;

• The larger the incurred value (paid plus case reserves), the greater the probability of the claim becoming a lost-time claim; and

• The probability of a claim transitioning increases with claimant age until age 65, and then it declines.

It Takes a Team to Manage (Medical Only) Claims

All members of the claim management team need to take a proactive approach to medical only claims. Even claims that are reserved at lower amounts – $500 to $1,000 – can reduce a program’s efficiency and effectiveness. Small dollar amounts allocated across countless files add up.

• Claim Managers: Be a leader and work hard to make sure all members of the team are moving claims toward settlement. A file that collects dust impacts everyone;

• Claim Handlers (more experienced and indemnity handlers): Provide guidance and assistance to newer members of the team. Make sure they know how to be efficient and effective. Mentorship can pay dividends across the team by building morale. It also demonstrates you are capable of handling more complex matters; and

• Medical-only Claim Handlers: Pay attention to what is going on. Understand there is a learning curve so do not shy away from constructive feedback. Never be afraid to ask questions.

Conclusions

At the end of the day, the only good file is a closed file! This starts with a program-wide review of medical only claims. Make sure these files are properly reserved and files that can be settled are moved toward closure. It is also important for everyone on the claims management team to be involved and work together for the good of a program.