Is Your Adjuster Playing Favorites With Your Claims

Adjuster Will See Thousands of Claims

 

Throughout the course of an adjuster’s career they will handle hundreds if not thousands of claims.  Most of these claims will be audited for company and state compliance, and plans of action will be discussed on all of them.  Whether to deny or accept claims can be based on a multitude of factors using the comp statues and company policies as guidelines.

 

There are no two claims that are exactly alike, the same way that there are no two adjusters that are identical.  There is room for interpretation in this field of workers compensation.  Adjusters will review the details of a claim and make a decision on the compensability based on their investigation.  But not all of these factors are based purely on law alone.  There are plenty of personality factors that are taken into account, especially when dealing with subjective claims where the claim is questionable.  But why would one person’s claim be accepted, when another person with similar circumstances could be denied?

 

 

Reputation of the injured worker

 

One of the questions a claims adjuster will ask the employer is if this claimant is a credible worker.  Since the employer deals with this worker day in and day out, they get to know whether this worker is a “troublemaker” or “dramatic” over the course of time. Some workers are known for being drama kings and queens, where they can complain about every little thing.  Other workers are workhorses, complaining little if at all about the work and just putting their nose to the grindstone and getting the job done day after day.  When it comes to subjective injury, especially one that is not witnessed, the claims adjuster will hold a lot of weight on the worker’s credibility. Sometimes this fact alone can determine whether or not a claim is accepted or denied, where the adjuster will lean towards denial of the claim based on credibility of the worker alone.  This is by no means applicable to all cases, but it can come up in the minor ones.  This fact can be very true if the worker has a history of reporting injuries about every little nick or strain.

 

On the other hand, if a “good” worker has a subjective injury, and little to no injury history, then you can bet that the employer will pass that on to the adjuster. Chances are that this claim would be accepted just based on the fact that this particular worker is never hurt, a good worker, and because they reported an injury means that they are probably in need of some medical assistance to recover.  Whether this is considered ethical or not is in the eyes of the beholder, but it is a reality.

 

It can be viewed as negative in the eyes of an adjuster if the worker was recently moved, assigned a different job, suffered a wage decrease, or was recently disciplined.  It can be seen as “getting back” at the employer if one of these events happens and all of the sudden a worker claims an unwitnessed subjective strain injury.  Whether it was warranted or not, employees can harbor some resentment towards their employer for whatever “wrong” was committed.  A lot of workers see filing an injury as a way to get back at their employer.  But just because they file an injury doesn’t mean that it will be accepted. This will come down to the investigation of the adjuster on the aspects of the claim.  Sure an injury was reported, but if it was not witnessed and the doctor cannot find anything wrong with them, did an injury actually occur?

 

 

 

90% of Claims Are Accepted

 

Keep in mind that for the most part, approximately 90% of claims are accepted.  The adjuster sees payment of a few medical bills as less costly than if they deny the claim and the worker files a lawsuit for comp benefits.  If this were to happen, the adjuster is now faced with legal fees which would probably be triple what the claim would cost if they had just accepted it, so they may accept it based on that fact alone. It will depend on the facts of the case, the reputation of the employee, and the medical details.  If nothing seems to add up, then you can bet the claim will be denied or disputed. The burden of proof is always on the injured worker.

 

 

Rapport Between Adjuster and Injured Worker

 

Maybe the most important factor in claims such as these will be the rapport between the adjuster and the injured worker.  Sometimes the relationship is like oil and water.  If this is the case, the adjuster may default to questioning everything, and making the claimant do everything by the book exactly.  If the relationship is rocky the adjuster leans toward an overall denial versus acceptance.  Especially true will be those claimants that call the adjuster over and over and over again, but not in a positive way. Saying that the “squeaky wheel gets the grease” is not always true. Sure it is common for someone to have questions about their claim, but when it turns negative in nature, adjusters are taught to notice that something may be up. That will make them take another look at the claim to make sure everything adds up.

 

On the other side of the coin, let’s say the adjuster and the injured worker click for whatever reason.  The employer sees the worker as a “good guy” and the investigation doesn’t turn up anything to go crazy about.  In this scenario, adjusters are likely to give an injured worker the benefit of the doubt.  This adjuster can let a few things slide and can push the claim towards compensability versus a denial, based on their relationship alone.

 

 

Is This Ethical?  Not Really.

 

So is this ethical?  Just because two people do not seem to see eye to eye, does that mean that their claim should be denied due to a personality conflict?  The answer depends. Ethical adjusters can look past any personality flaws and focus purely on the facts of the case, and they can make their decision on compensability based on that alone.  For all intents and purposes that is the proper way that adjusters should conduct themselves.  However, this is not reality.

 

This is where managers and audits should come in to play.  Even if everyone on Earth did not like said claimant, that should not mean that this worker cannot get their fair shake when they file for a work injury. This point should be taught to newer adjusters, and the veteran adjusters should be reminded of this from time to time.  This is the proper and professional way to conduct the determination of claims, day in and day out, no matter how little or how often you have to argue with a claimant.  Personal feelings and attitudes need to be left in your car in the parking lot when you come in to work. They should not influence if a claim is accepted or denied.

 

 

Summary

 

Adjusters will get along with some people, and they will have conflict with some people.  That is the nature of the business.  But professional adjusters can leave their personal opinions outside of the workplace, and handle claims based on the merits of their investigation.  If the employer does not see this happening, then something needs to be said to the adjuster.  Everyone deserves the right for a fair, non-biased claim investigation and determination.

 

 

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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

 

Quite Possibily The Worst Workers Comp Claim Handling Ever

 

Candidate for the Worst Claim Handling Ever

 

A leading candidate for the worst claim handling everturned up in a workers compensation claim file audit.  A third party administrator (TPA) was handling claims for a statewide government self-insurance pool. And yes, all of the following mistakes were on one file!

 

 

Coverage

 

The TPA adjuster, upon receiving the claim, went to verify coverage.   The coverage had expired twelve days before the claim was reported. The date of loss was five days after the coverage expired. The adjuster wrote in the file notes that he would confirm coverage before making any payments.” However, before the adjuster had done so, the TPA switched adjusters and the coverage question was forgotten.

 

Mistake #1. Handling the claim before coverage was verified.

 

 

The lack of coverage wasn’t addressed again until the pool’s executive director contacted the adjuster over a year later. By then over $65,000 had been paid on medical and indemnity by the TPA from the pool’s trust fund. There was no coverage but the pool was in an estoppel situation, so the TPA continued to cover the claim.

 

Mistake #2. The second adjuster not reading the first adjuster’s file notes.(WCx)

 

 

 

Contacts

 

Best Practices for a TPA include making contact with the employer, the employee and the medical provider within 24 hours. The TPA had overloaded its workers comp adjusters with over 200 files each. The government pool’s contract did not contain any provision for the maximum number of claims to be assigned to an adjuster.   The second adjuster on the file never even saw the claim during the first three months it was assigned.

 

Mistake #3. Not reviewing the file when it was assigned.

 

Mistake #4. Timely contacts with the involved parties were not made.

 

Self Insured Mistake: Not having a contract stipulation on how many files could be assigned to one adjuster. 

 

 

 

Investigation

 

Since the second adjuster never contacted the insured, the claimant or the medical provider, there was no investigation of the claim. The Employer’s First Report of Injury reflected that “the employee (a painter) hurt her lower back when she tried to move a five-gallon bucket of paint.”

 

Mistake #5. No investigation of the claim.

 

 

Medical Handling

 

File note entries read “Received medical bill” or “Paid medical bill” with the name of the medical provider and the bill amount. One medical report summarized in the file notes stated, “employee continues to work with her low back pain and wrist pain.”   Three months into the claim a medical report stated “will need to do bilateral CTS (carpal tunnel syndrome) surgery.”

 

Mistake#6.  Not comparing medical reports with the reported injury on the claim.

 

 

The employee was an obese woman with diabetes – two factors that can bring on CTS without an injury. Even though the claim was reported as a back injury, at no time did the adjuster question the carpal tunnel syndrome treatment.

 

Mistake #7. Failure to separate a covered injury from other medical conditions of the employee.

 

Mistake #. Lack of medical knowledge that CTS is not always injury related.

 

Mistake #9. Failure to get a medical termination based on whether the CTS was work related. If it was it should have been handled as a separate claim.

 

 

Indemnity Handling

 

The first contact with the employee occurred over four months into the claim when the employee called the adjuster inquiring about when she would be paid for her Temporary Total Disability, as she was off work due to the right wrist Carpal Tunnel Syndrome surgery (the left wrist would be done a couple months later). The adjuster did not follow up on the Temporary Total Disability question and got another phone call from the employee. The first contact with the employer occurred almost five months into the claim when the adjuster asked the employer for a wage statement.

 

Mistake #10. No on-going contacts with the employee and the employer.

 

Mistake #11. Not obtaining the wage statement from the employer when it was first noted the employee was going to need CTS surgery.

 

 

The adjuster put the temporary total disability (TTD) checks on autopilot and forgot about them. After about six months, the employee returned to work. As the adjuster had not been in contact with the employee or the employer, the Temporary Total Disability checks just kept on going out. The adjuster did not know the employee was back to work until receiving medical reports stating that the employee was at maximum medical improvement on her wrists and had been given a 15% impairment rating for both wrists combined. The employee received an extra eight weeks of Temporary Total Disability after she was back at work. The adjuster stated in the claim file notes that the overpayment of Temporary Total Disability would be taken out of the permanent partial disability (PPD) settlement. However, it never was recovered.

 

Mistake #12.Not making any effort to get the employee back to work earlier or to return to work on light duty.

 

Mistake #13. Putting Temporary Total Disability checks on long-term automatic issue. (WCx)

 

 

Remember the low back pain?

 

The employee had only been back to work for two months when the adjuster contacted her about the overpayment of Temporary Total Disability and settlement of the Permanent Partial Disability claim. The employee advised the adjuster that her back still hurt and she needed to go to the doctor.   The doctor ordered an MRI of the low back. The employee had a herniated disc at L4-L5 and a partially herniated disc at L5-S1. The doctor scheduled surgery for the employee.

 

Mistake #15. Not having inquired about the lack of medical treatment on the low back for almost a year.

 

 

The adjusterfinally paying attention, refused to approve the surgery until an independent medical evaluation (IME) could be completed. The IME confirmed the need for the surgery. After the surgery, the employee was off work for another seven months before the doctor placed her at maximum medical improvement with a 25% rating.    

 

Mistake #16. Not making any effort to get the employee back to work earlier or to return to work on light duty.

 

 

Negotiations

 

The adjuster contacted the employee with an offer to settle both of her Permanent Partial Disability ratings based on her being 40% disabled. The employee argued that she should be considered 100% disabled as she was not able to go back to her job as a painter. The adjuster refused to consider the claimant as having permanent total disability (PTD). A week later, the adjuster received a letter of representation from the employee’s new attorney, who claimed the employee was PTD. The attorney requested an administrative law judge (ALJ) hearing. The ALJ reviewed all the medical records and agreed with the adjuster’s defense attorney. The employee’s attorney appealed. The Workers Comp Board (WCB) agreed with the defense attorney. The adjuster paid the 40% PPD rating.

 

 

Worsening of Condition

 

A year later the employee’s attorney contacted the claims office, but the second adjuster was no longer with the TPA. A third adjuster on the claim learned that the attorney filed a request for the WCB to consider a “worsening of condition.”

 

 

Index Search

 

The new (third) adjuster looks over the file and realized that an ISO Index had never been filed on the claim. Once the index was filed, it was discovered that the employee had a prior back injury claim eight years before this claim. The employee was represented by the same attorney for both claims. The prior insurance company already classified the employee as 10% Permanant Partial Disability for a non-operated herniated disc. The prior medical reports showed that the employee’s earlier claim was for an L4-L5 herniated disc – the same injury the claimant had surgery for in this claim.

 

Mistake #17. Failure to index the claimant resulted in the TPA/pool paying for a claim that should have never been paid.

 

 

Exacerbation vs. New Claim

 

It was now obvious that the present injury was not a new claim, but the exacerbation of an old claim. If the index had been done when the claim first was received, it could have been referred back to the prior insurance carrier. The defense attorney requested that the ALJ transfer the claim back to the original insurance company. This is after the TPA had already paid the employee a 40% award (15% wrist and 25% back) on top of the 10% award the employee had received for the earlier claim.

 

The ALJ stated that as the TPA had already accepted the injury as a new claim, it would not change it now. The WCB appeal was denied, so the current insurer was stuck paying for the claim although it was an exacerbation of a preexisting injury.

 

 

Back to the Medical

 

The employee’s disk fusion surgery had failed. The treating doctor recommended another surgery. The third adjuster was too inexperienced to be handling this type of claim.

 

Self Insured Mistake. Not having a stipulation in the contract requiring experienced adjusters to handle claims -especially high dollar ones.

 

 

The adjuster asked her supervisor what to do. The supervisor said to get another IME. The IME stated that the fusion had partially failed, but absolutely did not recommend another surgery.

 

 

Sympathy

 

The attorney gave the third adjuster a sad tale of how much pain the employee was in, that the employee’s marriage was falling apart due to her pain and she was desperate to have the surgery. The attorney played on the adjuster’s sympathy until the adjuster agreed to the surgery.

 

Mistake #18.  Allowing emotions instead of medical facts to make the determination on how to proceed on a claim.

 

 

The adjuster should have had denied the additional surgery and forced the employee’s attorney to have the ALJ or even the WCB make the determination.

 

 

Permanent Total Disability Granted

 

Following the second surgery, the employee’s attorney filed a petition for PTD.   The treating physician had given the employee a total 75% Permanent Partial Disability rating based on the bilateral CTS surgeries and the two back surgeries. The defense attorney arranged another IME and got a similar rating of 65% total. The ALJ looked at the total medical history and the employee’s 65% or 75% permanent partial disability rating following her two wrist surgeries and her two back surgeries. The ALJ gave the employee a PTD finding. The defense attorney appealed to the WCB.   The WCB agreed with the ALJ and the third adjuster paid the employee another 50% rating. (WCx)

 

 

Summary

 

The failure to do the simple things in the claim file handling resulted in the self-insured pool paying out over a half million dollars in medical, indemnity and legal expenses. Verification of coverage would have stopped this claim before any dollars were spent. A proper investigation at the start of the claim, including an index of the employee, would have shown that the low back claim was an exacerbation of a prior injury and would have eliminated that portion of the claim. The review of the medical reports would have resulted in a denial of the CTS or at least had it treated as a separate claim. Non-compliance with Best Practices changed what should have been zero dollars paid into a PTD claim.

 

 

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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

 

To Replace or Not Replace that Shoulder

 

At one time or another as an employer you are going to experience work comp injuries.  Some of these injuries are minor in nature, while some can be severe and life-changing. 
 
Joint Replacement More Common – Very Difficult Claims
 
The nature of joint replacement can rear its ugly head from time to time.  In the past, joint replacement surgery was only thought to have occurred in older employees, with a lifetime of cumulative injury to the specific joint, be it the knee, hip, shoulder, or ankle.  But now Carriers are starting to see knee and shoulder replacement surgeries in younger to middle-aged employees.  This type of injury and subsequent surgery can lead to very difficult claims in the field of workers compensation. [Wcx]
 
In the past, Carriers were quick to deny surgeries such as these on the basis of the need for the surgery not being totally occupational in nature.  Once this replacement surgery is performed, it is seldom a “one-time” procedure.  The life span of prosthetic joints was said to be short, with it being a positive outcome if the prosthesis would last 3-5-7 years.
 
 
Advances Made in Surgery, Much Homework Still Needs to be Done
 
Recently over the course of the last handful of years several advancements have been made in the field of joint replacements, and several surgeons are getting quicker to recommend joint replacement surgery as a way to resolve ongoing pain and the need for opiate medication on a long-term basis.  Joint replacement has led to a better quality of life, and an increase in overall functionality in the right candidate.  But in the world of work comp, carriers are still very slow to accept these procedures without a lot of homework done beforehand. Let’s look at some of the pros and cons of these types of procedures:
 
 
PROS – Less Pain Meds, Decreased Long-Term Treatment
 
The first positive for getting joint replacement surgery is the decreased need for ongoing pain medication.  Expensive, and often addictive in nature, surgeons will point out that the prosthesis can lead to be a functional way of life without the need of strong pain-relievers, automatically positively impacting the overall expense of the work comp claim.  Decreased needs for physical therapy, diagnostic testing such as MRIs and EMGs, and decreased loss of work time after rehabilitation are all positive indicators that can mean less wasted claim dollars.
 
The technology involved in the actual lifespan of the prosthesis has improved as well over the last 10-20 years.  In the past, prosthetics were often drowned out in negativity, with insurers quick to point out that the lifespan is really an unknown.  In certain cases, the replacement could last 15 years whereas in others it could fail right out of the starting gate.  The price tag on these surgeries can hover well over $100,000 after all of the surgeries, diagnostics, physical therapy, medications, and so on, and that doesn’t include lost wages away from work and decreased productivity once the employee returns to gainful employment.  However, all of these are past stereotypes and research has shown more positive outcomes.  It varies from patient to patient, but, most injured workers have decreased pain levels, which can be the most important factor. 
 

Need Proper Evaluation to Determine if Surgery is Correct Answer
 
There may be no model for the perfect joint replacement candidate because everyone’s body varies.  Age, arthritis, functionality,pain tolerance, patience, activity level, job tasks, employer flexibility, job experience, and other pre-existing conditions need to be taken into careful account before a procedure like this is even considered.  I have seen some cases where the doctor will start off with a rotator cuff tear repair, only to end up recommending a total or partial shoulder replacement within 2-3 months post-surgery.  This may be quick to jump the gun considering the extent of the injury, however, the adjuster has to consider if the injured worker will fail a number of surgeries before finally considering joint replacement.
 
 
CONS – Fear of the Unknown, Will the Surgery Work?
 
I believe that the strongest con involved in these procedures is the factor of the unknown.  Carriers like to know facts, and have statistically-guaranteed outcomes.  Unfortunately with joint replacement procedures there is not a guarantee.  You can send the claimant for a few IMEs with different surgeons and get a feel for what they think will happen, but until that patient goes under the knife all bets are off. These claims and injuries have to be evaluated on a case-by-case basis.  Your risk drivers will help to determine if authorizing these procedures will lead to a best outcome.
 
The biggest unknown of them all is the actual claimant.  Psychologically, surgeries are not a magic bullet.  There can be months of pain and rehab ahead, and your injured worker may not be the most patient person in the world.  In my experience dealing with these procedures post-op, the most common complaint is they want to know when they will be better and able to function like they did prior to the injury.  The truth is, some people will never be the same.  They may never be able to pick up their kids or grandkids and toss them in the air as they did before.  They may not be able to lift 30lbs over chest level or they may never be able to squat down and garden in their front yard pain-free as they once did.  And this fear of the unknown can stop many people from even wanting to go through with a procedure with such unknown results.
 

Carriers Often Settle Early to Ensure End to Claim
 
The reality is that with these invasive surgeries is nobody knows the outcome. This can scare off adjusters from authorization and steer the claim into litigation for settlement, which could be just as costly.  Carriers calculate if the claim were to settle, they know the outcome and the associated costs.  If a claim such as this were to settle for $250,000 at least the Carrier can pay that, and be done with it.  Whereas if the carrier sinks $100,000+ into this procedure, who knows if this person will need another surgery in 5 or 7 years, and maybe that surgery is the one that will fail even worse than the first one. 
 
Carriers fear unknown future costs, and fear even more the potential for a claim to have to be re-opened with a higher expense in the future. Settlement leads to the end of the claim and guarantees that it is over. Your claimant receives a check, and you close the file knowing it cannot be reopen years down the road. Carriers have to hedge risk which can cost them greatly upfront in Court, but they get comfort knowing the claim is over.  This isn’t to say that the carrier doesn’t care; after all, the claimant has to be on board with settlement for it to go forward.  This maybe the best way for all parties to move forward with each satisfied with the outcome.  Of course, each case will vary greatly from one to another, which is the hardest part involving claim of this nature. [Wcx]
 
 
Summary
 
If a claimant has a recommendation for joint replacement surgery, your carrier has to do their homework.  Whether is it involving the knee, shoulder, hip, or ankle, I would be surprised if any carrier or adjuster accepted the need for a joint replacement surgery without taking the time to gather years’ worth of past medical records, get a few IMEs, and evaluate the case very carefully.  These procedures affect the claimant in one way or another, either positively or negatively.  It is only after the procedure that all parties know if it is worth it in the end or not.
 
 
 

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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

20 Factors Influencing Workers Comp Claim Settlements

A common mistake made by employers (and some workers compensation adjusters, too) is to believe that the settlement value of a claim is based on the actions taken when the employee has finished the medical treatment and has indicated he/she wants to settle the claim. While all these negotiations tactics and claim strategies do have an impact on the settlement value of a workers compensation claim, they are by no means the only factors in a claim settlement. The best settlements do not start at the end of the medical treatment; the best settlements start the day of the accident.
 
 
One of the most important steps an employer and the workers compensation adjuster can take to optimize the settlement value of the claim is to start work on the claim immediately. This entails the employer reporting the claim to the claims office within minutes (not hours or days) of the employee reporting the accident/injury. [WCx] Immediate reporting of the claim allows the workers comp adjuster the opportunity to:
 
1.    Make same day contact with the employee, employer, and medical provider.
2.    Completely investigate the accident details.
3.    Determine if there are issues in regards to compensability.
4.    Establish the nature and extent of the injury to prevent the employee from later adding additional medical issues to the claim and increasing the eventual settlement value.
5.    Control the selection of the medical provider in those states where the employer/insurer selects the medical provider.
 
 
If there are issues with compensability, it is much easier to negotiate settlement later, if the compensability issues have been properly evaluate and established at the start of the claim.
 
 
The settlement value of the claim is not simply controlled by handling the claim in accordance with best practices at the start of the claim. Every action the claims adjuster and the employer take between the initial investigation of the claim and the settlement negotiations also affects the settlement value of the claim. These include:
 
 
1.    Maintaining on-going contact with the employee and the medical provider.
2.    Arranging for the employee to return to work in light duty/modified duty as soon as the medical provider permits and the employee is able.
3.    Integration of medical management into the claim handling activities.
 
 
By continuing to manage the workers compensation claim in accordance to best practices, every step taken in handling the claim moves it closer to the appropriate settlement.
 
 
When the medical treatment has ended, or the employee or the employee’s attorney indicates a desire to settle the claim, there are numerous additional factors that come into play in establishing the settlement value and obtaining the best possible settlement. The adjuster will consider:
 
 
1.    The permanent impairment rating, if any (including an independent medical evaluation in some situations).
2.    The jurisdictional requirements.
3.    The value of future medical treatment.
4.    The impact of preexisting medical conditions, where permitted.
5.    The employee’s indemnity rate (whether permanent partial disability or permanent total disability).
6.    The exposure for future indemnity cost.
7.    The cost of litigation, if needed to resolve the claim.
8.    The cost of rehabilitation, if needed.
9.    The cost of vocational training, if needed.
10. The value of death and funeral benefits, if applicable.
11. The value of any offsets.
12. Any other strengths and weaknesses of the both sides of the negotiations.
 
 
When the employee’s injuries are complex or the value of the claim is disputed, the adjuster can utilize a reserve worksheet to assist in the establishment of the value. On the reserve worksheet, each of the above factors is given a value. The monetary values of all factors that are a part of the claim are combined to establish the settlement value.
 
 
When the employee has an attorney representation, the employee’s attorney follows a similar approach to establish the claim’s settlement value. The attorney attempts to maximize the settlement value of the claim in order to maximize the attorney’s fee. However, the employer’s attorney knows the true value of the claim, regardless of what the employee’s attorney maintains the value is in the settlement negotiations. Most claims settle without lengthy litigation because when both parties have evaluated the same factors in the same manner, the estimated value of the claim will be similar, which allows for a negotiated settlement of the claim. [WCx]
 
 
The settlement value of a claim is influenced by the adjuster’s compliance with best practices throughout the course of the claim, from the day of the accident to the day the employee reaches the point where negotiation of the claim settlement can start. Factors affecting the settlement can be evaluated individually and combined to determine the overall settlement value.
 
 
 

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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

NO DEAL – Why You Would Not Want to Settle a Workers Comp Claim

When litigation comes around, the first thought may be to try and settle the claim as soon as possible. After all, for every day that goes by with a claim in litigation, wages owed accrue and legal costs add up. Depending on the claim, if it is higher exposure with a higher wage earner, it is worthwhile to try and defend the claim should it be deemed not work related or if there is another dispute. On the other end of the spectrum, if the claim is of smaller exposure then it is probably better to wrap it up before the costs to defend the claim outweigh the costs to dispute and the file. It may also be the other way around, which proves that there is no blueprint to handling a litigated claim.

 
 
Below we discuss a few factors on why to not settle a claim. [WCx]
 
 
The claim was denied from the very beginning
Some cases are denied right from the start. When fighting a claim early on, whether it is due to a statutory defense, or by other means that deem the case not work related, it is usually a good idea to stick to your guns. The consequence if you decide to roll over and accept the claim after initial denial can be costly.   Sometimes surgeries fail, workers are unmotivated to return to work, or key evidence may be discovered later that leads to the claim being disputed or suspended. This just sends the case back in litigation. Whatever the case may be, if there was enough tangible evidence to deny the case upon receipt, do what is possible to maintain that denial and try to shift the injured worker to file for short term disability or to medically treat under their health insurance. If they refuse to do so, then let the legal wheels turn. As long as the claim is denied early on properly, there should be enough ammo to uphold the denial.
 
 
The worker is no longer an employee of the company
A lot of litigation includes employers being added to an existing claim for another employer involved in litigation. Injured workers that attempt to file for workers comp due to cumulative injury usually add all of their employers into their Petition for Hearing. This is because they are trying to show that an extensive work history is what ead to the injury. Just because the employer is added in to existing litigation does not mean that the company has to automatically start paying on the claim. In fact, if the worker was a short term employee, it actually can help the defense to not have to contribute anything to the treatment or lost wages. The argument can be made that the other employers with longer tenure with this employee are the ones responsible.  This leaves you possibly contributing a nominal amount towards a global settlement between all of the employers.
 
 
If a Petition in the mail is received, do not panic! Instead refer the claim to the Carrier, and the Carrier will assign legal counsel. The important thing to remember is if a Petition is received is to send it to the Carrier right away. If there is indeed a delay, there may be fines or penalties that can hinder the defense and cost a significant amount of monies.
 
 
The claimant has unrealistic demands for settlement
Sometimes the injured worker feels a sense of entitlement and turns to their employer as the responsible party. If you were able to deny or suspend a claim, that means there should be enough evidence to defend it. Even when trying to be realistic with a fair settlement offer, this may not be what the injured worker is looking for in the long run. If this person is offered $10,000 and the counter demand is $100,000, then consider that a significant gap in negotiations. It is doubtful that this will resolve itself on its own, so it is best to involve litigation and let the Judge figure out what is fair. Rarely, if ever, should an unjustified settlement go forward.  In extreme cases like this, even plaintiff attorneys' can do little to talk reason into the claimant. Let the Judge help in the defense of the claim.
 
 
The case has little to no value due to wage coordination through Pension or Social Security payments or near-future payments.
When an injured worker turns 65, or nears turning 65, the value of the claim can drop considerably.  In most states this is due to the fact that the Pension or Social Security payments will take over as being primary income, and the workers compensation pay is considered secondary. Once a claimant enters age 63 or 64, plaintiff counsel will start to push to settle before the value of the claim drops. It is important to recalculate current and future exposure.  If a claim drags on, before you know it, the injured worker is retirement age. Workers are staying in the workforce longer than ever, and this scenario is becoming more and more popular. 
 
 
Do not be fooled by the worker having a sudden change of heart. Chances are if the worker has been slow to negotiate in the past and all of the sudden tries to push a settlement figure, then something is amiss. It can certainly happen that someone has a change of heart.  However, it is more likely due to the claimant finding out that once an age milestone is hit such as 65 or 66, their case drops considerably in value. It is always good practice to be sure to make recalculations at least a few times per year, and reflect those changes in the offers to settle. [WCx]
 
 
Summary
No one likes to be involved in litigation, other than attorneys. As an employer, open ongoing litigation is a question mark of unknown value, and every day that goes by the values increases. It is good practice to try and limit exposure whenever possible, but there are cases where it is in your best interest to let the litigation run its course. And hopefully when it is all said and done, a decision is made that benefits all parties fairly.


 

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. ContactMstack@ReduceYourWorkersComp.com

  
WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com
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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

The Many Twists and Turns of a Workers Comp Claim

 

 
Every now and then when I meet people and tell them about my past work as a claims adjuster, I sometimes get a blank stare in return. The question that usually follows is “What the heck is that?”
 
 
True, before I got into the claims world years ago, I had no idea what a claims adjuster was.  When I took my first job in claims, the job description sounded interesting.  I had a background in Economics, and knew that insurance costs were a typical part of the financial structure of a business along with many associated costs. But that was about my total knowledge of that industry. I had no idea what a claims adjuster was, or what I would be doing day in and day out.  It sounded like being a detective of sorts, and I figured I would be investigating fraud and people faking injuries to try and get a big fat settlement. [WCx]
 
 
After my 3 week training course, and many years on the job experience, I discovered it was a lot more than just investigating potential fraud. There was the investigation part of a claim, the medical part, and the litigation part of the claim. But how do the adjusters handle claims? Is there a common blueprint that all claims use? And if so, are there any variations? Let us discuss the life of a simple workers comp claim.
 
 
  1.  The claim arrives at the desk of the adjuster.
When an adjuster receives a new claim, it is fairly common practice that the adjuster has 24 hours to make the 3 initial contacts: the recorded statement of the claimant, the statement from the employer about what happened, and a call to the medical clinic to obtain the medical records and to talk to the doctor (if needed). After these contacts are made, an initial decision can be made on the claim on compensability or not. The employer holds a large key here, as the employer has the eyes and ears about the claim’s potential issues regarding the causal relation and the overall compensability. Also important are the medical records, since they also will hold a large part of the background of the injury, and they will also shed some light on if this is an acute, objective injury or something that is more subjective and a little harder to relate back to the alleged work incident.
 
 
  2.  A compensability decision is made on the claim
At this point, after the contacts are made and the medical records are obtained, the adjuster will make a decision on the initial outcome of the claim.  If this was a fall that resulted in a leg fracture, this will more than likely be a compensable injury. Unless you uncover some major degree of horseplay or a very direct violation of a stated safety protocol, that type of fracture claim is probably legitimate. 
 
 
More subjective strain-like injuries, however, are often more difficult to prove.  People come into work carrying baggage from outside of work activities, and those claims can take longer for a causal relation to be established.  The worker will say that it is related to daily work duties. The employer may add some other details, such as the employee is known to be moving to a new house over the weekend, or helping a friend roof a house for example.  When this type of gossipy evidence is introduced, the adjuster will take a step back and probably file for an extension to be able to complete an investigation before making a decision on the overall compensability of the claim. Background checks, witness statements, and an IME may be needed at this point to try and determine what, if anything, is work related. 
 
 
2(a) Let us say the employer has nothing too bizarre to add. The injury is reported promptly and the injured worker goes right to the clinic. The injury is witnessed, and nothing out of the ordinary occurred.  For the most part, the claim will be deemed compensable and the worker will be paid wage loss if applicable, until returning to work or released from medical care without restriction.
 
 
2(b) Now let us say the employer did add that they know of some other inside,or outside-of-work circumstances that could have contributed to the injury. The employee may be upset over a recent performance review, and shortly after filed a claim for an injury. The injury is not witnessed, and the employee was doing something that they do not normally do as part of the job.  The story of the injury has now changed depending on who else the employer talked to on the jobsite, and nobody seems to be able to confirm what exactly happened or why. At this point, the adjuster will place a dispute on the file, and point out to the employee that there are some inconsistencies in the investigation of the claim, and a decision cannot be made on whether the claim is indeed work related or not. The burden of proof falls on the employee; it is their burden to prove how and why the injury occurred during the course and scope of employment.  It is not the adjuster’s job. 
 
 
3.  The Claimant files for a legal hearing or obtains legal counsel
So now a dispute is placed on the file, and the employee is not very happy. The employee visits an attorney, and the attorney feels that there is a solid case to start with filing for a mediation or a hearing. When the adjuster receives notice of the legal counsel retainer, a call is placed to the claimant’s attorney. Plaintiff counsels will vary wildly in how workers comp claims are handled. Some are very involved, and proactive, and some are not. The adjuster will explain why the case is being disputed, and report there is not enough clear evidence to show that this worker was 100% injured in the course and scope of employment. If an IME is performed, and in the favor of the carrier, the adjuster will forward a copy to the attorney for review. The attorney may file for the deposition of that IME doctor, to try and poke holes in that doctor’s medical opinion. But typically, cases that go into dispute attempt to be settled before any major litigation goes forward. The timeline on when a settlement can be made can take many weeks or months, even years, and during this time the claimant will continue to get medical treatment and accrue wage loss, which increases the overall value of their claim. A settlement will consist of a compromise of the medical and wage expenses, and usually will include the full and final resolution of the claim of all issues past, present, and future.  Again the time span on a resolution can take many months, if not a year or two depending on the extent of the injury. The settlement generally cannot occur until the worker reaches the healing plateau, or are fully released from medical care with no further medical disability. If the workers comp judge agrees to the guidelines of the settlement, an Order is signed. Then the adjuster cuts the checks to the necessary parties, and the claim is resolved. [WCx]
 
 
 
Summary
Between when the claim is called in, and when the claim is resolved, it can take many more turns other than what is outlined here. For the sake of brevity, we keep it nice and somewhat neat. However any claim can spiral out of control at any time, prompting the need for surveillance, vocational evaluations, job placements, several IME appointments, witness statements, and much more. The point we are trying to make here is that it is easy to say that all claims follow this road, whether accepted or not. Claims adjusters wear many hats, and workers comp claims can be very complex. Severe injuries can occur at any time, and know that the more complex the injury, the more complex the claim can be. Even if a claim seems to be legit on the surface, there are many factors the adjuster has to look at before a claim can be accepted as compensable.

 

 

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.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Key Reasons Workers Compensation Claims Take So Long to Close

Given recent economic turmoil, many are having a hard time meeting financial obligations. This especially rings true for injured workers, who already have a strike against them — they are receiving workers compensation wage loss benefits at 66 percent to 80 percent of their previous income, and they are injured.

 

The situation worsens when an injured worker faces situations such as elimination of their job, permanent physical restrictions, or a long recovery after a major surgery. These factors mean pending workers compensation claims are being held open much longer, inflating claims counts for adjusters across the board.(WCxKit)

 

 

Below, are five situations that contribute to delays in closing workers compensation files:

 

  1. Claimants trying to milk the system.

In the minds of most injured workers, having some money coming in is better than having no money coming in. The injured worker may not have a job to return to or may fear termination because of an on-the-job injury, so they maximize the symptoms of their injury; this is called malingering.

 

 

Whatever the reason, a current trend involves injured workers stretching claims out as long as possible. Some purposefully take longer to recover by doctor hopping, trying non-conventional forms of treatment, and exaggerating pain complaints. The length of time out of work must be proportionate to the degree of disability.

 

 

Most physicians will catch this and mention something in medical records, which should alert the adjuster to set an independent medical evaluation (IME) or to do some surveillance on the file. Using the MDGuidelines is also helpful; since that offers a range of times a worker should be approaching maximum medical improvement (MMI). If the worker is not back to work within the guidelines, it is time for an IME. Be proactive on the claim or the months will continue to go by and the claimant will achieve their goal.

 

 

  1. Injured workers have no job to return to for light duty, let alone full duty:
    As mentioned above
    , a common scenario for an extended compensation claim is when the position the worker was in is eliminated, or when the employer does not have a transitional duty program. Since the job market is tight, some injured workers let their accepted workers compensation claim go on as long as possible.

 

 

Employers should alert adjusters before job cutbacks so they can discuss strategy on who will be affected. The adjuster can form an action plan to get the claimant back to full duty without letting him or her slip through the cracks.

 

 

  1. Claimants choose to litigate because they have no other choice and nothing to lose:

When claims are denied, workers may think they have nothing to lose by filing for a hearing or seeking counsel. This causes the claim to be open for several months or years while the litigation ensues and parties work toward an eventual settlement. The wheels of the legal system often move slowly, and this contributes to the number of open claims out there. If you take a slow-moving legal system and overload it with everyone filing for a WC claim hearing, you get a backlog of claims and the system barely moves. Stay in touch with counsel to make sure he or she is trying to settle the claim and move negotiations forward. The very best way to avoid litigation is to communicate with the employees. Have an employee brochure, a written transitional duty policy, have employee’s acknowledge receipt of the policy, have a brochure for your network physicians, and most importantly have an Injury Treatment Medical Information Form, a/k/a Work Ability Form. THIS gathers information from the injured employee’s doctor at the first medical visit. Employees contact attorneys because they can’t get information from their employers about their claims or their medical bills are not paid.

 

 

  1. Claimants have severe injuries:

Due to company cutbacks as mentioned above, one worker may be doing the work of three. This leads to employers trying to do more with less. Injuries are bound to happen, especially in more heavy-duty, manual-labor positions. Employees working longer hours and doing more strenuous activity are leading toward a musculoskeletal injury and a probable surgery, if not worse.

 

 

These workers may be reluctant to report an injury for fear of losing their job. So they try to work thorough the pain, until the injury gets so bad it needs immediate attention. Workers need to know to promptly report injuries no matter what the circumstance, so they can be treated before it gets worse. Workers with wrist pain wait until they have full-blown carpal tunnel before reporting the pain; whereas if it had been reported sooner, full recovery would have been more rapid and less traumatic; waiting is prevalent when pay is conditioned on production-based pay.

 

 

  1. Some injured employees wait for the Centers for Medicare and Medicaid Services (CMS) to approve the Medicare Set-Aside (MSA):

The dreaded MSA. If an injured worker is eligible for Medicare and the case is in litigation or parties want to settle, in order to settle the claim, an MSA is necessary. This will pay the employee what Medicare would have paid for the continued treatment of the injury. The employee then pays for future treatment from this account. He or she then files paperwork with CMS that tracks the claimant’s continued medical treatment long after the workers compensation carrier settles.

 

 

Getting CMS to approve an MSA can take from eight months to two years as there are numerous payment issues to be ironed out. Carriers and CMS employees are adjusting to this new system and, so far, it has not been a smooth transition, according to Gould and Lamb, experts in MSA issues. An adjuster or counsel can further explain how this works in individual jurisdictions.(WCxKit)

 

In summary, workers compensation claim closure rates have slowed nationwide with multiple forces to blame. But, with a good action plan, some persistence, and a bit of patience, these issues can be resolved and the file can eventually be closed for good.


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 WORK COMP Book: www.WCMANUAL.COM

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.

 

©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

 

5 Times to Just Settle That Workers Compensation Claim File

pic5There are times while engaged in a workers compensation file that you are better off just settling the file out, redeeming all costs for medical, wages, and future medical exposure. Some files will not necessarily call for a full settlement, maybe it is better to settle either wages or medical, or both, but it has to be done when the scenario calls for it. Some examples are below.Note: These are general examples, and all actual claim situtations should be reviewed by your legal counsel.

 

 

 

  1. The injured worker has been terminated by the employer

The cause of a good percentage of litigated files comes when the employer terminates employment with the claimant during the course of their injury and subsequent rehabilitation. The claimant feels they were terminated unfairly due to their injury, and this will send them directly to a plaintiff attorney. This will open up significant exposure for ongoing wage loss, and it will extend the life of a claim. (WCxKit)

 

 

On most occasions you are better off waiting to drop the axe on termination until the claimant has either reached their end of healing, or the end of the case. This way, if you want to settle the file, you can include the voluntary resignation of the claimant from the employment.Note: consult with legal counsel before settlement, having them review voluntary resignation to make sure it meets requirements of state law as “voluntary” and that it complies with all other requirements.

 

 

  1. The injured worker has no job to return to within their permanent medical restrictions

This scenario happens a lot when a major surgery or amputation is involved. The job the worker once did can no longer be done by that worker. You have the option of moving the employee to another department or position, but often with smaller companies the option is just not there.

 

 

This is a good time to settle the wage portion of a claim. If you know for sure the worker can no longer do the job they once did, and you do not want to spend the cost of vocational retraining or vocational job placement, then you should settle out the wage portion of their claim. Again it is best to wait until their medical situation stabilizes before you approach this topic. You do not want to pursue this too early, as the claimant may try to stretch out their medical recovery, further securing their wage loss benefits and adding to the cost of the claim’s wage loss.

 

 

Depending on the job, some claimants will know they have little to no hope of returning back to work at their old position. But not every injured worker is easy to deal with. Changing jobs or losing your job is a major roadblock in a claim, and it can be costly to settle out the wage portion of these claims. But in the long run, it is worth it. Vocational training and placement is not a guarantee, and you do not want to incur those costs and then also have to settle the wage portions out when you cannot find the injured worker a job.

 

 

  1. The injured worker still works for their employer, but their case is denied coverage under workers compensation

In this case you do not have to settle the wages and medical to include a voluntary resignation, unless you want to add it in. If the adjuster denied the case as being compensable, but the worker filed their claim under their disability coverage, and then filed for hearing after returning to work once released from medical care, this is a case to settle after all the exposure for wage loss and medical bills are gathered.

 

 

This case gives you the total exposure, since the lost wages are known, and the medical cost to full duty is known. This is known as a “closed period” settlement.

 

 

Typically the adjuster will have to negotiate a lien with the medical carrier, and a compromise will be made on the wage loss the worker incurred. Unless you have a fantastic denial and can take your defense all the way to trial, it is best to make the compromise and settle for a portion of the exposure. This is probably the most common litigation example in the world of workers compensation.

 

 

  1. The worker’s case was disputed by the comp board, and then they were laid off due to workforce reductions. The injured worker was paid unemployment, and their medical carrier paid the medical cost to full duty

Here we have an example of taking a wage loss offset, and negotiating a medical lien. This is a fairly simple case to settle. Most states will allow a claimant to get unemployment pay when they are laid off. Even when they are off on a medical leave. This is a “collateral source benefit” because the employee may be making more when not working than when working.

 

 

However, if this person files for litigation, the insurance company can offset what the full-wage loss would have been, so, in essence, they get a credit for the wage loss, and only have to deal with the medical lien from the carrier. These medical carriers are usually easy to negotiate with, and most liens can be settled for easily up to 50 percent of their cost.

 

 

Medical carriers will also get a better fee reduction than workers compensation insurance carriers, so not only does the workers compensation carrier get a credit for the unemployment pay the worker received, they also get cheaper medical cost for all the medical expenses the injured worker incurred during their treatment and recovery. These are also usually closed-period settlements, and can be redeemed for a relatively low legal cost.

 

 

 

  1. The injured worker files for an occupational injury claim, naming several employers as the defendants

Occupational injury claims are usually filed by seasoned workers who have spent their lives working for several employers.  When their shoulder or back finally gives out and they need surgical repair, if they seek out an opinion at a plaintiff attorney’s office. The counsel will usually file a hearing for an occupational injury claim, and they will list all of the claimant’s past employers, since they will assert that each period of employment lead to the accelerated degeneration of the worker’s body, which lead to the ultimate injury they incurred.

 

 

In this case, each employer will contribute an amount towards a global settlement. The exposure of each employer will depend on the duration of employment, types of jobs the claimant performed, and the associated risk involved in relation to the injury. The hardest part about these claims is figuring out how much each adjuster should have to contribute. Once the adjuster takes all the past employers and the exposure into consideration, they will nominate a general amount for the represented employer’s exposure, and once all parties agree on all the amounts the case can be settled. It can take some time for all carriers and adjusters to agree, but they eventually get there and the case can be resolved.(WCxKit)

 

 

Workers compensation claims are settled all the time, usually for one of the reasons outlined above. As you can see, you have a number of opportunities where a settlement is the best option, and you should discuss with your adjuster if this is the road you should explore, instead of incurring other costs to bring an injured worker back to work at your place of employment. This differs from my normal opinion of bringing every able employee back to work.


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.

 

©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

 

Workers Compensation Rountable Roundup For July 2-10

This week at the Workers Compensation Roundtable discussion group on Linkedin there are several new discussions, including this one from Deborah Pfeifle: What is the average life span of a WC claim from first report of injury through closure, nationally? What is the #1 issue that precludes claim closure?
 
Charlie Larson of South Dakota responds with, “We are allowed to file written discovery and conduct depositions. After the petition is filed, we have 30 days to answer, each side has 30 days to answer discovery, and after obtaining a medical authorization, it takes forever to get medical records. After that is done, the depositions begin. I've had some cases drag out for years, but that typically is the result of a claimant attorney not moving the case forward.”
 
He encourages participants from other states to write their comments.
 
Mike Benishek writes that, while he knows of no national figures for claim closure, his “med-onlys usually close out in 60 days. Lost time varies by claim.” He adds, “As for what precludes claim closure, #1 is Attorneys (both claimant & defense attorneys) and the ever popular Medicare Set Aside (MSA) requirements.”
 
And Karen Rutledge writes, “I am not certain about national standards, but in TX if we could obtain claim closure on an indemnity case within 105 weeks it was a success as there is lifetime medical treatment option. In OK and CO, an indemnity case with litigation could be up to 2 years. I agree with Mike medical only was usually 60 days as you had to wait for medical providers to submit all the bills.”
 
Though an older discussion, the topic asking which state has the worst WC laws is still drawing comments. This week David Sheck, a WC and PEO broker for 20 years, writes, “I would say it is a tie between Ca and NY. Generally states in the Northeast are close runner ups.” And participant Mark Walls directs readers to a document showing the Oregon WC premium ranking summary.(WCxKit)
 
John Winkler says, “NC should be in the running as well — No cap on TT and the requirement to return injured workers to ‘suitable employment’ can be a bear with an Avg. cost per claim 34% higher than the median of 46 other states and medical costs increasing in cost per visit.”
 
And Greg Krohm adds, “I am really surprised by the near consensus on CA, IL and NY. The next interesting question is: What specific system features are the most disliked by employers (payers)? I suspect the reasons would be diverse and different in each of the above states, e.g., IL fee schedule is being racked over but the CA fee schedule is not bad relatively speaking. Hearing delays may be a big problem in one state but not in another. IL has no treatment guidelines and NY and CA guidelines have been the focus of a lot of discussion. Another interesting question: would organized labor pick a different list of states?”
 
And lastly, a new discussion was brought up by Thomas, who asks, “Does anyone have experience with the use of EBT cards for scheduled indemnity benefit transfers? Vendor recommendations?”
 
Join us at Linkedin's Workers Compensation Roundtable right now and right here! Better yet, invite your friends so they too can become informed on hot topics in the Workers Compensation industry.(WCxKit)
 
Workers Compensation Roundtable is jointly managed by people dedicated to the concept that workers compensation is a manageable line on your expense ledger, and that informed professionals are empowered achievers. Workers' compensation is not simply a cost of doing business, it is a cost that can be controlled. Beginning with an assessment of cost drivers, benchmarking data, and integrating the solutions, employers can reduce workers' comp costs 20 to 50 percent. With proper information, professionals managing compensation claims can reduce costs and improve outcomes for all stakeholders in the process. This group is for employers, business owners, risk managers, HR managers, insurance executives, and brokers to discuss the obstacles and strategies to overcome them.

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.
 
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.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

Wal-Mart Opens Up Checkbook to Compensate Group of Hispanic Employees

Wal-Mart has agreed to pay $440,000 to a group of Hispanic employees in Fresno who say they were subjected to ethnic slurs and derogatory remarks by a co-worker.
 
 
The settlement was announced recently by the Equal Employment Opportunity Commission.
 
 
The EEOC sued Wal-Mart and its affiliate Sam's Club in 2009, alleging the workers were being harassed and that Wal-Mart failed to halt the mistreatment in a timely manner a charge Walmart has denied. (WCxKit)
 
 
At least nine employees of Mexican descent and one, who is married to a Mexican, claim they endured ethnic slurs on a daily basis by a co-worker, who was also Hispanic. The workers, who provided food samples to customers, complained in April 2006, but no immediate action was taken, EEOC officials report.
 
 
Instead, the harassment intensified, according to Christine Park-Gonzalez, an EEOC program analyst in Los Angeles.
 
 
It was not  until the workers filed a complaint with EEOC in October that Sam's Club fired the harasser in December 2006.
 
 
According to Wal-Mart spokesman Greg Rossiter, the company fired the worker once the full extent of the allegations was brought to the company's attention.
 
 
As part of the settlement, Wal-Mart also agreed to make changes in how it deals with these issues at its Fresno and Bakersfield Sam's Club stores. (WCxKit)
 
 
The company committed to a three-year agreement to provide training to employees regarding anti-discrimination laws; teach managers how to investigate and report harassment complaints; and create a tracking system for complaints.
 
 
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact:Info@ReduceYourWorkersComp.com.
 
 
 
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.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com

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