The coronavirus pandemic has inspired many of us to take on do-it-yourself projects, especially home improvements and landscaping activities. While this is a great outlet and use of downtime, one area where DIY is clearly not the way to go is settling workers’ compensation cases. For this, you want a team of specialists, each doing what they do best to create a synergy that leads to the best outcomes for all.
As recently as May, there were reports of an increased number of claims moving to settlement. Injured workers with older claims were more inclined to look at their options in the face of the insecure economy, and cases with previously unwilling injured workers were settling successfully.
As the pandemic has progressed, court systems have changed, and overall claim volume has dropped, the total number of overall settlements has declined. However, the challenges of the pandemic are no reason to throw up your hands! It is more important than ever to take another look at legacy claims that may be ripe for settlement. Injured workers may be likely to at least discuss the possibility of getting access to cash and ensuring they will have enough money to pay their medical expenses going forward. If presented appropriately, employers/payers may be able to move many of these older claims off their books.
Use the Team Approach
The very reasons that some injured workers get ‘stuck’ in the workers’ compensation system may be the same reasons that persuade them to settle in the current environment. For example, fear of running out of money is among the biggest causes of workers staying in the system, even if they don’t like it. Having to deal with Medicare requirements on their own is also an overwhelming fear among affected injured workers. Losing the ‘security’ of a nurse case manager, adjuster, or others who help them navigate the healthcare world is yet another. All these can be addressed to an even better extent than they are while a person is in the workers’ compensation system — if the right players are in place and working collaboratively.
In addition to helping allay the fears of the injured worker, a well-functioning settlement team also benefits each individual stakeholder involved. Rather than having more work to do, each expert focuses solely on his specific area, meaning no one involved has ‘extra’ tasks.
But having the right team members in place is only part of the equation; they must also have solid relationships with one another and with the entire team for it to be effective. This takes time to build trust, but it can pay off in dividends for injured workers and stakeholders alike.
A variety of members should constitute the team, largely depending on the circumstances and needs of the injured worker. Among them will typically be:
- Claims Adjuster – who leverages the expertise of the other team members.
- Employer – since that person is in charge of the relationship with the injured worker.
- Settlement Advisor – who acts as a resource for many of the other team members to help them understand the needs of both sides.
- Medicare Set-Aside Partner – who manages compliance with the Medicare Secondary Payer Act.
- Professional Administrator – who will be the support system for the injured worker post-settlement.
- Defense Attorney – who may have more information about documentation, causation and other issues that can be used to better understand how the MSA and settlement plan can be developed.
- Medical Advisor – a physician who offers clinical insight and expertise vital to the settlement process.
When each of these partners is highly proficient in their niche area, the process can go very smoothly. As an example, the MSA partner can save valuable time and money in the process.
“The Medicare Set-Aside stems from the requirement that Medicare is the secondary payer,” explains Dan Anders chief Compliance Officer at Towers MSA Partners. “When Medicare sees that workers’ compensation cases are settling, they want to ensure the burden of future medical payments are not shifted to Medicare. So, the MSA was developed, over 18 years ago, to take a part of the workers’ compensation settlement and allocate it to future medical costs that would otherwise be paid by Medicare.”
The MSA expert does a number of things in the settlement process:
- Works with the client to determine if an MSA is necessary.
- Drafts the MSA and works to make sure it is effective for settlement. “Drafting an MSA that’s not going to achieve a settlement is worthless, so the MSA may need to be developed or a clinical intervention utilized to get to a point where it can be used,” Anders said.
- Secures reasonable MSA amount by reaching out to treating physician(s) to clarify ongoing medication use and necessity of future treatments.
- Where necessary, seeks approval of the MSA from the Centers for Medicare and Medicaid Services.
- Identifies and resolved Medicare conditional payment exposure.
“The goal is to take things off the adjuster’s plate and work together to accomplish a successful settlement,” Anders added.
Addressing the Medicare component should be the first step in the process of engaging the settlement team. The second step is to get input as to whether the injured worker is appropriate for, and comfortable with settling.
The employer/payer and MSA partner work together to get a snapshot view of future medical costs, understand what clinical interventions are feasible, and determine whether an MSA is necessary. Once done, the settlement advisor and professional administrator engage with the injured worker to determine his or her needs and uncover any objections to settlement.
The settlement team strategy can be best accomplished through a 4-step process:
- Intervene early. The lines of communication among team members should open early to discuss what each member thinks about a particular claim
- Define each partner’s responsibility. While it may seem obvious what each team member’s expertise is, it’s important to clarify the roles and responsibility of each in the process so all can be held accountable.
- Collaborate effectively. All team members must be in agreement with the team approach and the idea of working together.
- Deliver excellence through a WIN-WIN outcome. The ultimate settlement must be right for the employer/payer as well as the injured worker.
We’re living in uncertain times. Many employees and employers alike are battling fears and concerns daily. Working together while allowing each team member to shine in his particular area of specialty creates the optimal atmosphere for effective settlement of workers’ compensation claims.
Author Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%. He works as a consultant to large and mid-market clients, is a 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 the founder & lead trainer of Amaxx Workers’ Comp Training Center, which offers the Certified Master of Workers’ Compensation national designation.
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