Lowering Work Comp Costs Archives

The RED FLAGS of Workers Comp Fraud

June 19, 2019 by Michael B. Stack Leave a Comment

A critical part of controlling workers’ compensation costs is to put into place solid investigation techniques. No matter how severe or minor a workplace injury, each case needs to be reviewed to identify any fraudulent claims and take appropriate action.

When communicating with employees, make it clear that the company will:

Immediately investigate each accident when it occurs to determine the root cause

Identify corrective measures

Watch for minor extensions of days out of work and outright fraudulent claims.

Review these Red Flags of Fraud and request an investigation if you suspect a claim is illegitimate or exaggerated.

Injured Worker Red Flags:

Injury reported late, to an attorney or to the state commission before reporting it to the employer.

Fails to attend weekly meetings.

Is uncooperative, e.g., refuses to try a transitional duty job.

Is never home when you phone, especially during regular workday hours.

Has only a postal box rather than a home address.

Misses doctor appointments.

Is known to perform seasonal activities, hobbies, or work.

Has moved out of town or out of state.

Disputes average weekly wage due to additional income.

Files for benefits in a state other than the main location.

Disputes information supplied by the employer on “First Report of Injury” notice.

Refuses to cooperate in claim investigation.

Has an unstable work history.

Has recently been terminated, demoted, or passed over for promotion.

Has a prior history of injury management or liability claims.

Makes excessive demands or is pressing for a quick settlement.

Carries little or no health insurance.

Medical Flags:

Medical reports are repetitive, indicating continuing, constant pain with conservative medical treatment

The word “disproportionate” is used in medical reports

The doctor mentions there is “facial grimacing”

Positive “Waddell Tests” (test for low back pain) are mentioned

Workplace Flags:

Employer experiencing labor difficulties (i.e., layoffs, strikes, walkouts).

Tips from fellow workers, friends, or relatives.

The insurance company wants to settle the claim for a considerable amount of money.

“Things” just don’t ADD UP! Trust your gut, and if something seems off, be sure to check it out.

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.

Contact: mstack@reduceyourworkerscomp.com.

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

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

Washington State Man May Get Decade Behind Bars

January 16, 2013 by Michael B. Stack Leave a Comment

Washington State Man May Get Decade Behind Bars

A Washington State man certainly wasn’t the apple of a superior court’s eyes recently, charged with first degree felony theft for illegally collecting workers compensation benefits.

As the Department of Labor & Industries (L&I) points out, Doyle Ronald Wheeler, 36, of Spokane, reportedly obtained benefits during the period of 2008 to 2011 on a workplace-injury claim for a neck and back injury.

Wheeler’s benefits ceased once an investigation deemed he was behind the operation of his own business -The Pensmith, Ammo Head Design and Ammo Head Hydrographics – this while collecting workers comp.

Claimant Said He Was Unable to Work

According to Wheeler, he was unable to work once a slow-moving pickup truck backed into him at his workplace, Toby’s Body and Fender.

According to a videotape of the accident, Wheeler displayed no signs of injury after contact with the vehicle. Videotapes taken following the accident by L&I investigators demonstrate Wheeler coming to his physical therapy appointments, where his shoulder seems to sag and his movements stiffen as he nears the office. Not long after his physical therapy appointments, Wheeler goes back to moving around with ease. Wheeler was arraigned recently in Spokane County Superior Court.

Jail, Fine Could Be Severe

As he awaits his fate, Wheeler could receive a maximum sentence of up to a decade in prison and a fine of up to $20,000.

The court could also order Wheeler to repay the more than $113,000 in benefits gathered via fraud. Given both the potential jail time and fine, Wheeler could really see something to cause him pain.

Author Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com.

Contact: mstack@reduceyourworkerscomp.com.

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

Filed Under: Workers Comp News Tagged With: Fraud & Abuse, Lowering Work Comp Costs, Reduce/Lower WC Costs, Reducing Workers Compensation Costs, WC Fraud, workers comp, Workers Comp Fraud, Workers Compensation

5 Safety Communication Techniques for a Diverse Workforce

January 14, 2013 by Rebecca Shafer, J.D. Leave a Comment

Communicating safety issues effectively to a diverse workforce is a challenge. As a risk management consultant for many years, I’ve gathered solid information and experience on the best way to communicate safety and workers’ compensation messages to a large and diverse workforce, including organizations with thousands of employees with diverse backgrounds and many different job descriptions.

Before beginning, identify your target audience and the safety message you want to give. The most important thing an employer must do before implementing any safety communication program is meet with employees and supervisors to discover their ideas on what needs to be communicated and how best to do it.

Five Safety Communication Techniques

First:

Identify the specific message you want to communicate. Is the message about getting employees to work more safely around certain equipment? Or is it to provide information on steps to take if they are injured?

Second: Identify the skill set and grade level of your audience. A message to upper management on how to improve commitment to a safety program would be presented differently than instructions to first-line employees on how to report an accident. A general rule of thumb for thinking about language levels is to keep in mind that the Wall Street Journal is written at a first-year college level, while the Reader’s Digest is written at a sixth grade reading level.

Third: Consider job functions and how best to get your message across. Some employees might spend most of their work day in an office or one specific area of a plant. Others may spend it working in different areas of the plant or facility. Still others may spend their day driving from location to location. It’s a good idea to tailor your safety message to the types of safety issues more likely to affect those employees and areas of work.

Fourth: Identify the languages your employees speak. Don’t assume they will be just English and/or Spanish. There may be other immigrant groups, such as Russian or Vietnamese speaking workers. In addition, there are differences within languages, such as Cuban Spanish and Puerto Rican Spanish. Ask management to survey their workers’ languages and provide all safety messages as appropriate.

Fifth: Consider the work environment. If you have a congenial workforce, don’t use a heavy-handed communication style. Save it for a workforce where there may be a lot of discontent and resentment.

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com.

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.

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

Filed Under: Communication with Employees, Safety and Loss Control Tagged With: Employee Safety, lower your workers comp, Lowering Work Comp Costs, reduce your workers comp, Reduce/Lower WC Costs, Safety and Loss Control, workers comp, Workers Comp Communication, Workers Compensation, Workers Compensation and Communication, Workplace Health and Safety

How to Measure Your Return to Work Program Success

January 9, 2013 by Rebecca Shafer, J.D. Leave a Comment

For every day an injured employee is out of work, the cost of the workers’ compensation claim increases. Therefore, it is of critical importance to actively manage your claims using techniques designed to return injured workers to active work status as quickly as medically possible. This is true whether they return to active or modified duty. At the same time, you must be able to track and know exactly how well the return to work process is proceeding.

Return to Work (RTW) Ratio

How do you calculate whether injured employees are returning to work within an appropriate time frame or if they are out on comp for weeks at a time? The Return to Work Ratio (RTW) measures the effectiveness of your transitional duty program. The ratio calculates how long it takes employees suffering a lost time injury to return to work in either a transitional duty assignment or full duty. The RTW Ratio calculates total lost days and total claims to show the percentage of employees that have returned to work within the first few days after the injury. The RTW Ratio helps you categorize lost work days to ensure that employees aren’t off work too long.

The RTW Ratio accurately assesses how well your company manages the return to work process. The RTW Ratio allows you to calculate lost days quickly and see at a glance how well you are doing. The graphic visualization is helpful and motivational. Add new injuries to constantly update the ratio calculation to see how well you meet the goal of having 95% of employees returning to work within the first four days after an injury. Then you can take appropriate action as needed to improve your company’s rate of returning workers. You should also tell your broker when your RTW Ratio improves, as insurance carriers will want to know that you have made operational changes that will result in reduced workers’ comp losses.

For more about bringing employees back to work sooner see: http://reduceyourworkerscomp.com//employees-back-to-work-sooner.php

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

Filed Under: Return to Work and Transitional Duty Tagged With: lower your workers comp, Lowering Work Comp Costs, reduce workers comp, reduce your workers comp, Reduce/Lower WC Costs, Reducing Workers Compensation Costs, Return to Work & Transitional Duty, Return to Work and Transitional Duty, Return to Work Programs, Return to Work Ratio, Return to Work-RTW, workers comp, Workers Compensation

Employer Silence is Root of Many Workers Comp Problems

January 4, 2013 by Attorney Theodore Ronca Leave a Comment

46% of Workers Incorrectly Think Claims Being Contested

Workers Compensation Research Institute (WCRI) has published a most welcome study into the reasons that workers get compensation lawyers. The most disturbing reason, cited by 46% of workers surveyed, was that they thought their claims had been contested, even though the paperwork had just begun and no decisions had yet been made.

People working with claims, any kind of claims, understand that there is an initial lag, ranging from days to months, before an administrative agency becomes active on a claim. An insurance company usually, but certainly not always, is quicker to respond, but “quick” might mean weeks, and a family suddenly without a weekly check and little or no savings will be on the verge of panic.

Lawyer Should Not Be One Communicating with Worker

If they consult a lawyer, they will quickly learn that the resolution is inevitably going to take time. But why must they hear that from a lawyer? Every risk manager or human resources chief could tell them that a lot faster (and cheaper!)

But there is something else your personnel can tell a worker who has just filed a comp claim – how to receive information and, if necessary, some form of income continuation. (A lawyer could tell them the same, but many don’t and it isn’t nearly as comforting as hearing it from the employer.)

The study mentioned another fact. When an employer is small enough to know everyone in the workplace (say 200 employees or so) comp problems grow more slowly than when the employee has no one in charge who knows them. (Julius Caesar was famed as a military leader because he could address all centurions in his army by their names- over 500. If he could do it, with a bit of effort you can do it with 200.)

It is Your Responsibility

Finally, there is the old problem of “falling between two stools”, meaning that there is always help at hand, but everyone assumes that someone else will provide it. Rather than rely on a disastrous assumption, just reach out and communicate. An employer that stays in continuous touch during the month or two following a reported injury will be the first to learn of a problem, and the first to propose a solution. And somewhere, a lawyer won’t get that first phone call.

If a worker (and the spouse!) is aware that the employer will nudge a silent bureaucracy with a call, the comp problems will start small and grow smaller.

Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers’ compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100. medsearch7@optonline.net

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

Filed Under: Communication with Employees Tagged With: Communication, Employee Communications, Lowering Work Comp Costs, reduce your workers comp, Reduce/Lower WC Costs, Reducing Workers Compensation Costs, workers comp, Workers Comp Communication, Workers Compensation, Workers Compensation and Communication

Winter Workers Comp Surveillance Tips

January 2, 2013 by Michael B. Stack 1 Comment

Now that winter has arrived with a bang, it is always a ripe time for surveillance on those questionable claims. The hustle and bustle of the Holiday season is over, and people settle in to their normal winter routines, waiting out the cold weather for the arrival of spring.

For those problematic claims out there, this time of year is always a busy one for surveillance companies. Adjusters cannot wait to try and get some film of their injured claimant potentially violating their medical restrictions by shoveling out their driveways or partaking in a winter recreational sport.

Here are some tips to keep in mind for a successful hunt of trying to get that elusive film that can direct a claim from compensable to suspended:

Strike Not Only After the Big Storm, but During It

If you are like me and do not own a snowblower, the best way to make shoveling your driveway easier is to do it a few times while the storm is going on. This makes it a bit easier to heave all the snow off of your driveway. True, the snow you are pushing may not weigh 500lb, but that is the point. Anyone with a lingering back injury is going to have a hard time pushing a shovel, and I think any doctor will lighten the medical restrictions if they see their patient spending a lot of time outdoors with a shovel. When caught, most claimants will try to say they were only pushing the snow, and not lifting the shovel. However, any activity is showing that they are active, and it can be a way to get that person back to light duty work if they are currently on a no-work status.

Use Snow Blowing to Your Advantage

If your claimant does indeed have a snowblower, this can mean that they are not actually lifting anything. But they are on their feet, for long periods of time, pushing and pulling the blower around and being active in general. This may not mean that they are 100%, but they are certainly capable of doing light duty or sedentary work. Even if they claim that the snow blower is self-propelled, the claimant is still walking behind it, bending down, and doing this for a period of time. I would find it hard to believe that any doctor would keep this person from doing sedentary work if confronted with the video evidence. Use your tape to get them back to work, and doing something beneficial for your workplace.

Watch For Potential Aggravation of Injury

Snow and ice are slick, and people slip and slide while shoveling and snow blowing. They are also bent over while using the snowblower which could lead to an aggravation of your current back injury claim. I am not injured, but I am sore after shoveling. If I were to already have had a lingering back injury, this is only going to make it worse. The same could be said if you are watching the video and your claimant slips and tweaks their back, or even worse they fall hard, probably making their current injury worse. The best way to handle this is to wait to show the doctor the tape until after their next appointment. In the medical notes, the claimant may show worsening signs of injury, and they probably will not tell the doctor that their symptoms worsened due to falling on their rear end while shoveling. At this time you have good evidence to show that their injury wasmade worse by slipping and/or falling down. Make sure you have the doctor be objective. By showing the doctor the film, you have concrete evidence when paired with the worsened medical report that their injury is now exacerbated by their outside activity. This should allow you to be able to be aggressive in trying to end your comp claim and move it to a personal medical condition.

Know if they Have any Outdoor Hobbies.

Since you know these people for a period of months or years, you may already know that they love to ice fish, or to snowmobile. Snowmobiling is very arduous, since riding on the machine can lead to jarring of the back, resulting in a worsening of the injury. Even if they do not claim to be medically worsened, if you can show them active on a snowmobile, then it would seem that they are healthy enough to return to work. The best evidence you could get is if the snowmobile gets stuck and they have to get off and lift the back of the machine to get it working again. These machines weigh hundreds of pounds, and if you can do that, you should be good enough to be returning to work.

Ice fishing is not as arduous, in fact it is pretty lazy, but it can still show a person hauling their gear out to their fishing shack and sitting for long periods of time. You want to show the doctor that this person is more active than they are leading on. Once you can show that, you have some great evidence to show that this person is healthy and ready for a return to work in some capacity.

If You Strike Out, Keep Trying

Getting some great surveillance film is luck of the draw. Sometimes there will be times that you send your vendor out and they return with nothing. That is OK, you won’t strike gold every time. But be persistent. Watch the weather reports, be aware of local fishing and skiing competitions, and send your vendor out again. If indeed you cannot gather any evidence then that is not necessarily a bad thing. This means your claimant is avoiding any activity that will make their pain worse or aggravate their injury. My friend calls surveillance “the art of verification.”

Summary

There are a lot of people out there that love the snow and the winter weather. I know people that have fishing shacks that are like a mini house, complete with TV and propane heaters. Some people snowmobile for miles in the bitter cold, and they actually enjoy doing it. This doesn’t mean that everyone out there is up to something bad, but it is a possibility. So take my pal’s advice, and verify that your claimant is doing exactly what they are supposed to be doing–which is laying low, resting, and giving their injury time to heal before returning to work.

Contact: mstack@reduceyourworkerscomp.com.

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

Filed Under: Fight Workers Comp Fraud & Abuse Tagged With: Lowering Work Comp Costs, Reduce/Lower WC Costs, Reducing Workers Compensation Costs, Surveillance, workers comp, Workers Compensation, Workers Compensation and Surveillance, Workplace Surviellance

Top 6 Causes of Workers Comp Injuries and How to Avoid Them

August 22, 2012 by Rebecca Shafer, J.D. Leave a Comment

Injuries on the job can occur at any time. Some employers have a higher risk of injury depending on the type of job they do day in and day out. Some workers have higher exposure to injury based both on their type of job tasks and their non-occupational conditions they bring into the workplace. This could be fatigue, other injuries, years of work experience, etc. Despite whatever baggage some workers carry to into employment, we see the same types of injuries that occur. These injuries fall into certain classes, which we discuss below:

Lifting

Perhaps the most common cause of injury is lifting. When workers are exposed to lifting tasks often, their bodies can start having some wear and tear, and the progression of this injury can morph into symptoms of muscle strains, spinal injuries, and the like.

A lot of the time workers will disregard the warning signs predisposing them to a muscle strain that needs medical attention. Everyone has aches and pains, some worse than others. But for the most part workers will continue to carry on through the pain, until they perform a lifting task that finally prompts the needs for treatment. In a perfect world, these workers will stop what they are doing at the first sign of injury and report it to their supervisor to get medical attention. But this is rarely the case. I have performed tons of investigations into these types of injuries, and when I talk to workers they usually tell me that they noticed the start of the particular pain days or weeks ago, it continued to nag them, until they were working and their back or shoulder finally gave out on them.

If you have a lot of lifting on your job floor, there are many ways to try and limit injury including rotating staff, taking frequent breaks, lifting in smaller increments, using back braces, on so on. Just be aware of the fact that if your labor force does a lot of lifting, and this can take its’ toll on your workers. So listen to them when they say they have a problem and report a claim if they feel it is serious enough to warrant medical treatment. [WCx]

Slip/fall injuries

About as popular as lifting injuries can be slips and falls. These injuries can be minor in nature, or as severe as a bone fracture. Especially hazardous will be slip/falls on stairs, or construction sites, leading to falls and the potential for more serious injuries.

Factors out of your control such as rain, snow, ice, and so on can lead to an increase in these types of injuries. Carriers see increased reports of slip/fall injuries in the Fall and Spring, due to the increase of icy conditions. Equally dangerous is snow, especially when it is carried into your building’s doorways which then melts and creates a slip/fall by an unsuspecting employee passing by.

As employers it is hard to be proactive against these types of injuries all of the time. But if you pay special attention when the weather conditions warrant, you may be able to save some of these injuries from occurring. Replacing your doorway carpets is a main way to stop the spread of snow and water into your building. Placing non-skid mats and borders on steps can also help.

So if you have a lot of in and out foot or machine traffic, especially when the weather seasons warrant, keep a careful eye out for these hazards. You may save a serious injury from occurring.

Machine injuries

It is obvious to say that manufacturing jobsites will have a lot of moving machinery. And with this increased presence of machinery you will see people being injured by these machines. Whether it is contusions or amputations, injuries will occur. A lot of the time these injuries can be prevented from happening. There are countless claims where the machines are modified, guards are removed, people placing their hands in the machines to remove clogs or stuck parts, and so on. This is especially true in workplaces where there a lot of parts and fast moving machines on an assembly-type line; workers are trying to do what they can to keep pace with their job demands.

Employers have to be very aware of the fact that machinery should never be modified in a way that removes the safety mechanisms from doing the jobs they were designed to do, which is preventing injury. Even worse is after the injury occurs, the carrier may try to subrogate against the machine manufacturer. But once the carrier discovers that the machine was modified or guards were removed, this deflates the effectiveness of their claim against the manufacturer. And worse yet, some states will punish the employer for allowing this modification to happen, which created an increased chance of injury. So save yourself the headache, and leave the machines to operate as they were designed to operate.

Lacerations

Laceration injuries can occur due to a variety of reasons. An employee can cut themselves on anything, ranging from a tool or part they are working on to a shelf, a nail, or just about anything else that has a sharp edge to it. These injuries may be hard to avoid, but you can try and lessen the hazard.

Taking input from your employees is always a good place to start. These are the people doing the jobs day in and day out. If they are telling you about sharp edges and sharp parts, listen to them. Equally important is watching the trend of your injury reports and loss runs. If you begin to see a lot of people sustaining a laceration injury while doing a particular task, it is time to investigate, before someone loses a finger or thumb due to injury.

Other employees

As dangerous as lifting, slips/falls, machines, and lacerations can be, equally dangerous are the other employees milling around on a typical day. Countless injuries occur from the fault of coworkers. I have seen employees dragged, pinched, ran over, dropped, cut, poked, burned, and the like. Of course the other worker feels bad, but not as bad as the person that was injured!

You have to preach awareness at the workplace. Have walkways taped off away from machines and where people in vehicles may be. Install mirrors around corners so people can see others coming. Beep horns and enforce speed limits around your work floor. The injury you may prevent may be your own.

Repetitive injury

Lastly we discuss repetitive injury. Workers that do the same task day after day use the same muscles and make the same movements day after day. Over the course of months and years, injuries can occur, the most common or popular being carpal tunnel.

Technology has come a long way in helping the worker to avoid a repetitive motion injury. Job tools are more ergonomic, employers use rotating job tasks and shift employees so they are not doing the same task all of the time. Machines have become more automated leading to less user interaction, which is helping to prevent injury. [WCx]

But this doesn’t solve the problem that repetitive injury can still occur. A word to the wise is that the earlier these injuries are reported, the better chance the employee has for a full recovery. If you wait too long, the worker may be so injured that they will never make a full recovery. So again, listen to your employees and watch your loss run reports for trends of injuries on certain jobs or while working certain machines. It can prevent injury in the long run.

Summary

The 6 mechanisms of injury stated above are not the only ones, but they are the most common. If you as the employer become more involved, and more proactive, you can prevent a lot of these injuries from occurring. Time and time again I recommend to you enlisting the help and input of your employees. They work the jobs, they face the hazards, and they can help you prevent some injuries from happening in the first place.

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.

WORKERS COMP MANAGEMENT MANUAL: www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR: www.LowerWC.com/transitional-duty-cost-calculator.php

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.

Filed Under: Medical Issues, Safety and Loss Control Tagged With: Injury Management, Injury on the Job, Lowering Work Comp Costs, WC Injury Report

Top 10 Ways to Control Your Workers Comp Costs

July 18, 2012 by Rebecca Shafer, J.D. Leave a Comment

There are many ways an employer can have a positive impact on workers’ compensation claim cost. We believe these 10 recommendations will assist you in your efforts to keep the cost of workers’ compensation under control.

The cost of your workers’ compensation premiums is greatly affected by the frequency of claims. The easiest and surest way to reduce the frequency of claims is to take the steps necessary to identify potential hazards, and then take the actions necessary to eliminate those hazards.

Timely Reporting:

All claims should be reported to the claims office immediately following an accident. The claims office will handle the claim better by starting on the claim quickly. The information about the injury, the witnesses, and the medical treatment is more readily available and is more accurate than any effort to recall the information at a later date. [Wcx]

Open Communications:

The person or people who report your claims to the claims office need to have open lines of communications with the adjusters. The establishment of rapport between the employer’s staff and the claims adjuster(s) will facilitate the accurate transfer of information between the parties.

Your Own Adjuster(s):

The employer who has a small number of claims (small being defined as less than the caseload of one adjuster), should requested a designated adjuster for your account (handling all your claims plus claims for other employers). By having only one adjuster instead of many adjusters handling your claims, the adjuster will become familiar with your return to work program. The designated adjuster will also learn your preferences for medical providers, the nature of your business, and other aspects of your workers’ compensation program.

The employer with a large number of workers’ compensation claims should request a dedicated adjuster to handle only your claims, and no claims for any other employer. If your company has more claims than one adjuster can handle, then multiple dedicated adjusters is appropriate. A combination of dedicated adjuster(s) and one designated adjuster will cover any number of claims.

A Return to Work Program:

Every employer, regardless of size, should plan ahead on how to accommodate an injured employee’s return to work. Whether you set up a modified duty job or place the injured employee in a totally different job than the injured employee normally does, it is essential that you accommodate the work restrictions. A return to work program will keep the employee productive, shorten the recovery time, and lessen the cost of both medical treatment and indemnity benefits.

Medical Management:

In the world of insurance where even simple medical services can quickly become very expensive, medical management is essential. In the states where the employer has the right to select the medical provider, it is essential to do so. One of the fastest ways for a work comp claim to get out of control is for the employee to select a medical provider that will be reluctant to let the employee return to work before he has fully recovered. Or worse yet, is quick to perform surgery where more conservative measures would suffice. Medical management also includes the use of triage nurses, trained nurse case managers, medical fee bill reviews, utilization review and independent medical examinations. The use of these various medical cost control techniques will reduce the overall cost of medical care.

Litigation Management:

The control of legal cost does not start when the claimant files for a hearing before the industrial commission. The control of legal cost starts when the claim is reported. Prompt reporting to the claims office, plus quick, courtesy handling of the claim will eliminate many of the claims that would otherwise go to an attorney. Employees hire attorneys when they are scared and do not have anyone answering their questions. The employer who maintains contact with the employee after the injury and works with the employee to resolve their concerns will have far fewer claims where the employee has hired an attorney.

Subrogation:

When a third party is at fault for the injury to the employee, the employer should assist the claims adjuster in gathering as much information as possible to document the liability of the third party. Proving the liability of the third party early on, and putting the third party or their liability insurer on notice of the intent to pursue the claim can make a recovery more viable. The amount recovered from the third party reduces the overall amount the insurer or self-insured employer pays in workers’ compensation cost.

Structured Settlements:

A structured settlement is basically an annuity or an annuity combined with a cash payment to settle a claim. A structured settlement reduces the cost of a claim by transferring the cost of the claim into the future, providing the insurer with years of time to grow their investment and cover the claim cost. [Wcx]

Claim Quality Audits:

An area of cost control that is frequently overlooked by risk managers is the claim file audit. An audit of the claim files by an independent auditor to verify the claim handling is in compliance with Best Practices will assist the employer in knowing where improvements are needed in the claim process. By eliminating mistakes, leakage is reduced and cost control is better implemented.

WORKERS COMP MANAGEMENT MANUAL: www.WCManual.com

VIEW SAMPLES PAGES

MODIFIED DUTY CALCULATOR: www.LowerWC.com/transitional-duty-cost-calculator.php

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.

Filed Under: Claim Audits & File Review, Claim Management, Medical Cost Containment, WC 101 Tagged With: Causes of High Workers Comp Costs, Cost of Workers Compensation, Lowering Work Comp Costs, Reduce/Lower WC Costs, WC Cost Containment Process, Workers Comp Cost Containment

Six Types of Employee Screening to Lower Workers Comp Costs

May 5, 2011 by Rebecca Shafer, J.D. Leave a Comment

There are many adages out there about circumstances just not adding up. Two of my favorites are “Don’t judge a book by its cover,” and “Things aren’t always what they seem.”

This can be especially important when it comes to new hires for your company. The greatest, most amicable person can walk through your doors and they could be the perfect worker in your mind. They could be experienced, charismatic, professional, and give you the best interview you have ever conducted.(WCxKit)

However, there can be issues lurking underneath that can expose your company to workers compensation costs.

What your new hire may not have told you:

1. They have had four knee surgeries.

2. They have been out of work watching TV for six months — or six years for that matter.

3. They are just lackluster work performers bouncing from one job to the next.

4. They lack the personality to deal with customers.

6 Ways Pre-employment Physicals and Background Checks Protect your Company:

1. Have all applicants complete a pre-employment physical before they can be accepted as new hire.

This should be standard for any position. Whether it is a sedentary desk job, or a job out on the production floor, having a physician do a physical exam on your candidate can save you a lot of aggravation down the road. This potential new hire may carry a lot of baggage medically that could become your responsibility after their first day of work. Physicians can spot surgical scars or other objective findings on exam that this person may not have indicated to you during their interview. Often it is thought that only workers performing heavy tasks should be considered for physicals. However, sedentary jobs can lead to back pain, neck pain, and repetitive injuries that may have been prevented if a physician noticed it during a physical exam before they were accepted as a new hire within your workforce.

With the current economy, a significant number of people have been out of work for a very long time. This leads to general de-conditioning, and since they are a new hire they want to work as hard as possible to gain your trust and acceptance. Oftentimes these people out of work that start work again are the first to be injured, since they are physically unable to perform the job at the pace required without injuring themselves. Monitor your loss runs, and if new hires are accountable for the majority of your injuries, then you have identified a problem that needs immediate correcting. It can be corrected by modifying your new hire screening by implementing a physical exam before they are hired and start work.

2. Have a detailed job description for your physician to review while performing the physical.

Just saying a worker will spend 90 percent of their time at a desk and 10 percent of their time walking to the printer and back is not a fantastic job description. Consider what goes in to a particular job day after day:

1. Talking on the phone.

2. Staring at a computer screen.

3. Reaching for things in a file cabinet.

4. Bending and squatting.

5. Reaching overhead.

6. Frequently lifting 40 pounds or more.

Whatever it may be the more detailed you are in your job description the better the doctor can assess your candidate and decide if they can physically do this job on a long-term basis in a safe manner. In the end, nobody knows the jobs within a workplace better than the employer. Additionally, the more detailed and elaborate you are in your job description, the safer your workforce will be because you will be hiring qualified, fit workers that can safely perform their job day after day.

3. Make passing a drug screen mandatory for all new hires.

This should go without saying. With prescription drug use on the rise, even though your potential hire looks on the outside to be healthy and responsible, there could be a lot internally that is physically wrong with them. For example, in one claim a worker sustained a back strain. During the interview, he said he did not go to the doctor right away because he had just taken muscle relaxers. Now, how did he get those? Were they his prescription? Does he take them every day? Does he have a prior comp claim that is active with another employer? Does his doctor refill the prescription without actually doing an exam? If this new hire already has some type of injury before even starting at your jobsite, how can you safely protect yourself and your fellow employees from being injured by someone under the influence of narcotics legally or illegally?

4. Ask for professional references and call them.

Most job applicants bring a reference sheet with them to the interview. Often these are professional references, but at times, a neighbor or relative could be used. Not that a relative could not be used as a potential reference, but they are not always unbiased? Calling all references should be standard practice in all HR departments. Again, not only to protect the company from making a bad hire, but, since this person will be working in and around all your other employees, you should not put them at risk by hiring an employee who past employers labeled as lazy, unsafe, or unreliable.

Make sure the references consist of previous employers – where the employees no longer work. Calling a current employer can be deceptive since they may give a good reference to get rid of a bad employee.

5. Have a private investigation firm run a background check on your applicant

Most PI firms have access to an insurance claims database, civil court records, police records, etc. This is especially important if you have workers driving your vehicles. Past traffic violations, DUIs, and other vehicle violations can be very detrimental to your company. By hiring such a person and putting them on the road in your company vehicle, that person is representing you and your company. The risk involved in vehicular accident claims is huge. You should only have workers with the greatest of safety records on the road representing your company. Equal attention should be given to potential new hires with extensive workers compensation histories, including litigation. This shows that they know the comp system, and are not afraid to retain counsel and litigate a claim if need be. Litigation increases your claims expense, and often a settlement will include their resignation from your company anyway, so before they start work for you, make sure they are not a “career claimant” bouncing from job to job looking for a settlement.

Beware: This is not foolproof: In one situation, a women in Charles Manson’s group did not show up on a criminal background check because the arrest was more than 25 years ago. She had turned state’s evidence and thus had not ever been “convicted” of the crime. The job she was applying for: childcare provider. Yes, this is true. Fortunately, someone in her neighborhood let the company know about her past track record. Hardly the type of person suitable for childcare.

6. Personality Profiling

Consider personality screening. Not every employee is suitable for every job. Customer service jobs require a pleasant, patient personality, and not everyone fits that mold. Personality profiling evaluates whether the moral compass is pointing the right direction. They check for traits such as entitlement mentality, theft, deception, cheating, dishonestly, drugs, hostility, and propensity to violence. In some situations the lost time rate dropped dramatically when using this type of testing. (WCxKit)

In conclusion, hiring new employees involves bringing a certain risk to your company. By being attentive and properly screening your new hires before they start work at your company, saves time and headache down the road by keeping the bad employees out, and only having a reliable, safe, productive workforce that is capable of doing their day-to-day jobs in the safest manner possible.

CHECK WITH LEGAL COUNSEL BEFORE IMPLEMENTING ANY TYPE OF EMPLOYEE SCREENING. STATE LAWS MAY LIMIT OR PROHIBIT THE TYPE OF TESTING THAT CAN BE DONE IN YOUR JURISDICTION.

Author Rebecca Shafer, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. See www.LowerWC.com for more information. Contact:RShafer@ReduceYourWorkersComp.com.

Our WC Book: http://corner.advisen.com/partners_wctoolkit_book.html

WORK COMP CALCULATOR: http://www.LowerWC.com/calculator.php

MODIFIED DUTY CALCULATOR: http://www.LowerWC.com/transitional-duty-cost-calculator.php

WC GROUP: http://www.linkedin.com/groups?homeNewMember=&gid=1922050/

SUBSCRIBE: Workers Comp Resource Center Newsletter

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.

Filed Under: Drug, Alcohol & Impairment Testing, Employment Law Issues, Lowering Premiums & Experience Mod, Medical Issues Tagged With: Hiring, Lowering Work Comp Costs, Pre-Employment Screening, Pre-Existing Medical Conditions & Injuries, Pre-placement Screening

Workers Comp Resource and Cost Cutting Areas

April 10, 2011 by Rebecca Shafer, J.D. Leave a Comment

Workers Comp: Ripe For Cost-Cutting – Two Places To Check

Despite devotion to corporate cost cutting, there is one expense that still gets very little attention: workers compensation.

And the cost is very high.

According to the 2010 RIMS Benchmark Survey, the average Cost Per Full-time Equivalent Employee for all industries combined is $701 Cost Per FTE for workers compensation. The Cost Per Employee is normally lower for companies with greater than 1 Billion in revenue and higher for companies with less than 1Billion in revenue. The 2010 RIMS Benchmark Survey contains tons of useful information. It’s definitely an excellent resource — either online or in print and companies that contribute their data get a huge discount, so that’s something to consider. The 2011 RIMS Benchmark Survey should be published soon. I get the print version, and keep it handy, on my desk, from the past 8 years.

Both the 2009 and 2010 RIMS Benchmark Surveys contain workers compensation best practices, indicating which best practices employers have implemented. This is excellent information to compare your company’s performance and build management committment for programs such as transtitional duty, employee communication, cost allocation, post injury response procedures and many more operational best practices. It’s well worth spending some time reviewing this information to see what your company can do better. For example, the RTW Ratio is closely tied to the mod and how much a company pays for their workers compensation, a fact that we have been waiting years to learn.

Many signs point to larger workers compensation tabs in the future. A good cost reduction goal for companies is half national average or half industry average.

As with other outlays, employers can trim with some thought and effort.

Costs need not be this high. Insurers, unions, workers, lawyers and doctors are all contributing to the current waste and the employers who finance workers compensation must bear much of the fault, too.

Why is this?

Employers are unwittingly encouraging employees to remain on workers compensation much longer than necessary.

When executives at a large publishing company were pondering their burgeoning workers compensation costs last year for example, they found a fairly convincing explanation.

Their employees who were getting such compensation were effectively receiving 10% of their salaries.

This company is not alone.

Here are some of the main reasons why workers compensation is often needlessly expensive:

Double Dipping

Like many other employers, a national construction company had a group disability insurance policy. Thus, one employee was receiving workers compensation following back surgery and, after 26 weeks, began receiving disability payments too.

Combined with some personal insurance policies, this double income meant the worker’s at-home pay exceeded his at-work pay. Naturally, in 1993, when the company offered him a job with light duties but at his full salary during his recuperation, he turned it down

The lesson: Eliminate double dipping. While workers personal insurance is their own, employers should deduct workers compensation from other duplicative company payments. To do otherwise encourages malingering.

Idle Income

In Massachusetts and a few other states, employees on workers compensation can qualify for unemployment benefits under certain circumstances.(WCxKit)

To prevent this outrageous form of double dipping, companies should offer all injured workers transitional jobs they can perform even with their physical restrictions. Under the eligibility rules, workers who refuse such offers will not be deemed unemployed.

Double Dipping and Idle Income are two ways your out-of-work employees may be milking the system. Find out more #WorkersComp.

Author Rebecca Shafer, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact: RShafer@ReduceYourWorkersComp.com.

WC IQ TEST: http://www.workerscompkit.com/intro/

WORK COMP CALCULATOR: http://www.LowerWC.com/calculator.php

MODIFIED DUTY CALCULATOR: http://www.LowerWC.com/transitional-duty-cost-calculator.php

WC GROUP: http://www.linkedin.com/groups?homeNewMember=&gid=1922050/
SUBSCRIBE: Workers Comp Resource Center Newsletter

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.

Filed Under: Benchmarking & FTE & Operational Comparison, Collateral Source Benefits, Lowering Premiums & Experience Mod, WC 101, Workers Comp Kit Tagged With: Best Practices, Collateral Source Benefits, Lowering Work Comp Costs, RIMS Benchmark Survey, Work Comp Cost Containment

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Workers Comp Resource and Cost Cutting Areas

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