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You are here: Home / Litigation Management / Why Cost-Cutting Your Defense Counsel Is Costing You More Claims

Why Cost-Cutting Your Defense Counsel Is Costing You More Claims

April 20, 2026 By //  by Michael B. Stack

The Problem With How Most Employers View Defense Counsel

In many workers’ compensation programs, defense attorneys are treated like a necessary evil—a cost to control, minimize, and scrutinize. That mindset is not just outdated. It’s expensive.

When employers view defense counsel purely as a line item, they create distance, delay communication, and limit collaboration. The result?

  • Slower decision-making
  • Missed opportunities to deny or resolve claims early
  • Higher litigation costs over time

The irony is simple: the more you try to “control” your attorney, the less effective they become.

The Real Role of a Defense Attorney

The transcript makes one thing very clear: the best defense attorneys don’t just defend claims—they help shape outcomes from the very beginning. They are not reactive. They are strategic.

Click Link to Access Free PDF Download

“Avoid the 3 Primary Reasons Injured Workers’ Hire Attorneys”

A high-performing defense attorney should:

  • Help determine compensability early
  • Guide investigation strategy
  • Recommend medical providers and IMEs
  • Identify red flags before litigation begins
  • Advise on when to pay vs. fight

In other words, they are part of your core claims team, not a vendor sitting on the sidelines.

The Cost-Control Trap

Many employers unintentionally sabotage their own results by over-focusing on defense costs.

This shows up in behaviors like:

  • Delaying attorney involvement to “save fees”
  • Micromanaging billing line items
  • Restricting communication unless “absolutely necessary”
  • Treating legal input as a last resort

But here’s the problem: by the time you involve the attorney, the claim is already more complicated—and more expensive. Early decisions drive outcomes. And without legal input, those decisions are often flawed.

What High-Performing Programs Do Differently

Best-in-class programs flip this model entirely. Instead of asking, “How do we reduce legal spend?” they ask:

“How do we use legal expertise to reduce total claim cost?”

That shift changes everything.

In high-performing programs:

  • Attorneys are involved early—even before formal litigation
  • Adjusters regularly ask: “What do you think?”
  • Legal input is used to guide investigation, not just defend it
  • The relationship is collaborative, not transactional

This approach leads to:

  • Better claim decisions
  • Fewer unnecessary lawsuits
  • Stronger defense when litigation does occur

The Fiduciary Relationship That Should Exist

One of the most important insights from the transcript is this:

A defense attorney should act as a fiduciary.

That means:

  • They prioritize your interests above their own
  • They give honest advice—even when it means less work for them
  • They focus on outcomes, not billable hours

When this relationship is working correctly, you’ll see behaviors like:

  • Taking quick calls without opening a formal file
  • Providing guidance early without immediate billing
  • Advising you to settle when it’s the right move
  • Recommending strategies that reduce long-term exposure

If your attorney isn’t operating this way, the issue isn’t legal costs—it’s alignment.

The Right Way to Measure Attorney Value

Instead of focusing on hourly rates or invoices, shift your evaluation to outcomes.

Ask:

  • Are claims being resolved faster?
  • Are litigation rates decreasing?
  • Are we making better early decisions?
  • Are we avoiding unnecessary disputes?

Because a great defense attorney may cost more per hour—but save you exponentially more in total claim cost.

Building the Right Relationship

To turn your defense counsel into a true strategic asset, focus on these actions:

1. Involve Them Early

Don’t wait until litigation begins. Bring them in during:

  • Initial claim evaluation
  • Compensability questions
  • Investigation planning

2. Encourage Open Communication

Make it easy to ask:

  • “What do you think?”
  • “Should we fight this?”
  • “Who would you recommend?”

3. Choose the Right Person—Not Just the Firm

The relationship matters more than the brand name.

Look for attorneys who:

  • Understand your business
  • Communicate proactively
  • Think strategically—not just legally

4. Align on Goals

Make sure your attorney understands your priorities:

  • Reduce litigation
  • Control total cost—not just legal cost
  • Protect employee relationships when appropriate

FREE DOWNLOAD: ” Avoid the 3 Primary Reasons Injured Workers’ Hire Attorneys “

Final Thought

If you treat your defense attorney like a cost, they will behave like one. If you treat them like a strategic partner, they will help you reduce litigation, improve outcomes, and strengthen your entire program. The difference isn’t in the attorney. It’s in how you use them.

Michael Stack, CEO of Amaxx LLC, is an expert in workers’ compensation cost containment systems and provides education, training, and consulting to help employers reduce their workers’ compensation costs by 20% to 50%. He is co-author of the #1 selling comprehensive training guide “Your Ultimate Guide to Mastering Workers’ Comp Costs: Reduce Costs 20% to 50%.” Stack is the creator of Injury Management Results (IMR) software and founder of Amaxx Workers’ Comp Training Center. WC Mastery Training teaching injury management best practices such as return to work, communication, claims best practices, medical management, and working with vendors. IMR software simplifies the implementation of these best practices for employers and ties results to a Critical Metrics Dashboard.

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

Injury Management Results (IMR) Software: https://imrsoftware.com/

©2025 Amaxx LLC. All rights reserved under International Copyright Law.

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

FREE DOWNLOAD: ” Avoid the 3 Primary Reasons Injured Workers’ Hire Attorneys “

Filed Under: Litigation Management

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