Claims Management as a Key to Your Safety Program

ALTHOUGH compliance is important, it is no longer the driving force in modern safety management. What is? Reducing costs, specifically reducing insurance premiums, is the primary driver. Of course you care about your employees, but having excellent compliance and low incidence rates is no reason to ignore additional opportunities for savings.

Investigating and reducing injuries is just the beginning. In an already successful safety program, tremendous potential exists in the area of post-injury cost containment. This includes return-to-work programs, but it doesn't stop there. There are plenty of other ways to save or to lose claims dollars at all stages of this process, from the time of injury to doctor's release. This is true on even the simplest claim, but it is certainly true of more complicated claims. The variation in claim expenses can be as much as 20-30 percent.

Don't assume your worker's compensation carrier is going to capture those savings for you. Good claims management on the part of in-house safety and human resource staff can.

Key Assumptions
Health care is expensive; live with it. Being stingy or sweeping things under the carpet is a little like waiting a week and then asking your dentist whether he can help you with a gangrenous arm.

Address injuries quickly. Even if you suspect malingering, get a diagnosis. Use the best possible providers, consistent with your needs as the customer. The best provider is highly qualified, identifies the condition and testing needs, makes the diagnosis, and promptly initiates treatment. Even malingerers, who are typically individuals with a predilection to fraud, will give up when backed into a corner with doctor's, therapy, and testing appointments. In such cases, going through the motions can spoil the appeal of malingering and may be enough to discourage further "moral lapses" on the part of those employees. Close the case, pay the money, and address your problem children by more direct means.

Use a detailed policy for accident and injury reporting and for medical treatment. Failure to report injuries, even vague aches and pains, demands discipline. Keep it simple but cover all the bases. Medical treatment should always be directed to your "preferred providers." If a clinic or provider is unsatisfactory, drop it.

Step One: Addressing Injuries Promptly
This includes injuries of uncertain origin, aches and pains, and odd complaints. This is an area where companies are sometimes penny-wise and pound-foolish. Getting quick treatment and diagnosis can limit both the severity and the timeframe of a claim. Why wait for a condition to worsen? It also serves as a strong deterrent to fraud by not allowing vague complaints to be lost in time and space. Make it clear to everyone, especially the injured employee, that you want him or her well again and back at work ASAP.

Use an accident and injury reporting policy. This should make clear to all employees, as well as to supervisors, what and when injuries must be reported. The greatest confusion typically arises with aches and pains, minor contusions, or symptoms of nerve problems. An ache and pain may be just a muscle ache, but if it does not resolve quickly (a few days) or seems to involve a joint, medical treatment should be sought. Nerve conditions (numbness, tingling, or shooting pains) as well as back or neck complaints should be directed to a specialist immediately. They must be reported at the earliest sign and should be addressed by a professional. It is completely unacceptable for an employee to complain about a backache four weeks after it began. While you might not seek immediate treatment for every single ache and pain, if things are not resolving quickly, put your physicians to work.

Step Two: Use the Best Medical Providers Available
You want a quick and accurate diagnosis. The closest little clinic may not be the best bang for your buck. You want treatment to commence as quickly as possible. In many cases, worker's compensation claims can be escalated to a specialist immediately, on your say-so. Don't let a general practitioner waste two weeks before making a referral.

Likewise, contact the specialist and try to push forward any appointments. Make it clear your employee is valuable and you want him or her taken care of as quickly as possible. Use services that are efficient, which means they get things done properly and quickly. The best service provides rapid, accurate diagnosis and prompt treatment protocols. A provider who repeats tests and shows little or no progress in two or three weeks is not being efficient. A general practitioner may dawdle, hoping to treat the condition himself, when referral to a specialist will provide the quickest path to recovery. When a specialist doesn't seem to be making progress, try another one. Identify specialists who are proactive about return-to-work and who are less likely to tolerate malingering.

Establish personal relationships with medical providers. Mutual respect is the key; you want them to know you care about the employee and what you expect from them. You want the best care, and you want your employee back to work as soon as possible. Write, call, offer facility tours, and offer to buy lunch for doctors and their staff. Include specialists, if possible and appropriate. Know the staff by name so that when you call, they know you are a valuable customer and a friendly partner in the treatment of your people.

Build a team with your carrier's claims people. Two heads are better than one, particularly on problem cases. If you have a good carrier, you should be able to forge a strong alliance with their claims staff. It saves money for everyone. If your carrier's claims department seems disorganized, doesn't follow through, or has a "revolving door" of staff, complain about it and seek competitive bids at your next renewal. Such disorganization almost certainly means that claims are costing more than they should.

Step Three: Stay Involved
Never, ever let the employee feel alone. Always keep track of your claims and their progress. Keep in touch with providers, carriers, and the employee, especially on indemnity claims. If something changes, you want to know now, not three weeks later.

Accidents happen. Among the several stupid things a company can do is to blame the employees and ignore them. Instead, if an employee is hospitalized, go to visit and send flowers. Even on minor injuries, call the employee or have the supervisor call. Make it simple: "We're sorry it happened. We're thinking of you and just want you to get better as quickly as possible. Are the doctors taking care of you? Let me know if you need anything."

These last items are especially important because most people will happily tell you if they have a complaint about their treatment. Fix it for them, and you're a star!

Address employee-directed care. Often a sign of a problem, employee-directed care is an option in most states after a short period of employer-directed treatment. Employees take this option for two reasons: First, they are genuinely disappointed with the treatment they've received from your provider (often when no progress has been made and they feel forgotten), or the employee is an opportunistic malingerer (or contemplating outright fraud).

Typically, the employee will choose her family physician. When this happens, contact the physician and make clear he or she is now dealing with a worker's compensation claim. You as employer have the right to access all information relative to the claim. They should file the claim with your carrier, not via ordinary health insurance. This should give you some leverage. These often can become contentious, especially where malingering is involved. Family physicians characteristically have a strong bias to their patients and are quick to provide liberal work restrictions. Being professional and forceful is your only option. It will also help to write a detailed letter expressing your concern for the employee's welfare, as well as your commitment to prompt, quality care. Providing a detailed description of light-duty work you have also will help and may be of benefit later if the case is litigated.

Beware "torpedoes." These are exploding claims that run below the surface and then detonate unexpectedly. While not always possible to predict, problem employees show a tendency to become torpedoes. These claims require more effort. At every step, policy must be explained and enforced. Do not let these employees direct treatment, which they may attempt to do even when treating with your physicians. Appointments, referrals, testing, and work restrictions should be double-checked by the company to ensure things are progressing.

Call to push forward any appointments and do not let the employee relax. Paint the claim into a corner. Many times, these are opportunistic frauds, essentially malingering taken to a new level because the employee saw an opening (either to claim a non-work injury as work-related or simply to stretch his indemnity coverage out to a ridiculous extreme with vague, non-resolving conditions).

Conclusion
Good claims management is consistent with everything a modern, professional organization wants to accomplish. You care about your employees. You want people back to normal, for their happiness and for your productivity. Finally, you need to watch your expenses.

Claims management is an area where penny-wise, pound-foolish can take on meaning. High-quality, prompt treatment can make a difference in morale, in minimizing costs and lost time, in reducing fraud, and it even can optimize litigation success. Often it's assumed insurance carriers handle this; however, their diligence is balanced against their time. A carrier may feel a $5,000 claim does not deserve much time.

A little effort on your part can easily make a 10 percent or 20 percent difference in the final cost of the claim, occasionally even more. Those dollars are magnified in future premium savings. Keep in mind that something like 35 percent of premiums pay for the insurance company to administer claims, etc. To the extent that your claims profile is lower, you are not only saving money that would pay for claims, but also saving the extra administrative costs.

This article originally appeared in the November 2004 issue of Occupational Health & Safety.

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