Legacy claims often involve ongoing indemnity and/or medical benefits that sometimes wane and become highly active at other times. They are difficult for claims teams to manage and control. They are time-consuming, expensive to maintain, and require ongoing oversight, medical analysis, mitigation, financial adjustments, and control.
Legacy claims often end up with high reserves due to ongoing expenses to manage the claim. These claims can be very difficult to resolve due to ongoing medical treatment, prescription drugs, mitigation efforts, and defense costs to name a few.
In general, many physical injury claims can be challenging to settle. When factoring in Medicare Set-Aside requirements, non-Medicare covered costs, claim expenses, and ongoing litigation, resolving these cases can sometimes feel impossible.
Key Questions
- What can we do to resolve these claims before they become lifetime benefit claims?
- How can we reduce the caseload of legacy claims that remain open and active in our organizations?
Here are some suggestions that may be helpful:
Do Not Resign these Claims to Lifetime Status
Just because a claim did not resolve in the past does not mean it cannot be resolved now. People and life circumstances change over time. Reviewing these claims without an active plan to resolve them can result in the premature resignation of claims to lifetime-pay status.
Avoid Blame
We cannot change the past. We can only evaluate the present status and create plans to reach resolution. Placing blame on prior claim handling will not change the current disposition. Stay focused on where things are now and how you can move the claim forward. Long-term cases often change over time, resulting in opportunities to mitigate, control, plan, and resolve them.
Create Action Plans
Create a plan to improve the injured person’s functional abilities and reduce the overall amount of care needed. Focus on reduction or weaning of drugs, and if you cannot reduce or wean injured people from drugs, refocus on mitigating long term drug costs by requesting alternative or generic drugs. This will also help reduce Medicare Set Aside costs (in the future) when you prepare the claim for resolution.
Complete File Reviews
Focused claim reviews are an effective way to determine what is happening with your book of legacy claims. File reviews can provide insights on current medical treatment trends, costs, and prescription drug usage. Reviewing claim data can provide a comparison between current medical trends with prior trends and can help identify previous barriers to settlement. Information from file reviews helps us anticipate future liability for our organizations. Knowing what happened in the past can be a helpful tool to understanding the future.
Look for Opportunities
Over the last several years, the global pandemic has caused many deaths. It also brought financial stresses, layoffs, economic changes, delays in obtaining goods, services, and medical treatment. Many people suffered from prolonged isolation, depression, and anxiety. Recognize that people who are vulnerable from prior injuries may have experienced significant or exacerbated struggles during and following the COVID-19 pandemic. Now more than ever, injured people may benefit from a comprehensive evaluation of their claims and a plan to resolve claims that supports their needs for the remainder of their lives.
Structured Settlements: A Resolution Tool
Structured settlements are a highly effective method of resolving claims compared to cash-only settlements. Cash settlements often result in premature dissipation of funds after claim resolution, and they do not meet all the real-life needs of injured people. There is an important reason every Workers’ Compensation statute in the country dictates periodic payments for lost wages and medical care for open cases. It’s the way most people live, paying regularly (weekly, bi-weekly, or monthly) for housing, food, transportation, insurance, medical care, and everything else. Structured settlements provide the perfect opportunity to resolve cases with tax-free periodic payments to cover life’s expenses. They also allow for creative enhancements – including cash, payments for future anticipated needs or for the benefit of family members, etc. – that are not required under state statutes.
Leverage Settlement Experts
Involving a team of settlement experts to design creative settlement plans can deliver a lifetime of value to injured workers and their families while helping you resolve your most problematic claims. If you need an ally on tough cases, consider the value of a strong team of settlement experts.
Arcadia consultants have decades of claims, legal, and financial experience, making them uniquely qualified to support your resolution goals. They take a comprehensive approach when reviewing and identifying complex issues, and they understand the needs of injured people. They are experts in managing government benefits for injured people when settling claims. In mediations they provide an additional pair of experienced eyes and ears and help engage injured people and their representatives on the most meaningful concerns about the future. Arcadia consultants also understand the obstacles and financial pressures facing companies when they reserve claims for a lifetime.
