Controlling Workers Compensation Costs Part 2
This is the second part of our posts on controlling your workers compensation costs for your restoration company.
6) Claims Administration Audit
Benefits paid to employees, under workers' compensation, are statutorily derived but subjectively influenced by the method and extent of investigating the claim; expertise in reserving losses; human error in posting and recording information about the losses. Solving these problems can be accomplished by:
experience modification review prior to submitting losses to the rating bureaus
participating - policies review so that losses are reviewed prior to calculation of the client's dividends,
pre-certification of hospital admissions and length of stay,
concurrent hospital stay review and discharge planning,
rate negotiations of physician fees, hospital daily rates and capitation rates, and
elimination of payment for treatment of conditions unrelated to work injuries.
7) Job/Task Analysis
Matching the employee with the job is a preventative measure designed to decrease the possibility of injury before it happens and to help an injured worker return to work quickly in a realistic manner. Job/task analysis can be viewed from the following perspectives: matching the equipment to the employee; modifying the workstation; analyzing the job itself (perhaps breaking it up among several employees); providing a modified schedule--flextime or altered rest periods; relocating the place of the job to make it more efficient or convenient to the employee
8) Litigation Management
Excess and spurious litigation generates staggering costs - it is necessary to return to the basics of a no-fault system. In the meanwhile, the focus of litigation management will be on the reduction of existing litigation costs, cast management, examining litigation status, billing reviews, selection of counsel and Alternative Dispute Resolution (ADR), i.e., mediation and/or arbitration. To avoid litigation there are several principles to follow: prompt and objective exploration of the accident; procedures that show concern and equity so as to prevent hostility and suspicion; selection of competent providers to prevent poor treatment; assuring that all aspects of a claim are confronted so as to avoid dispute and protracted expenses.
9) Incentive Programs
This initiative utilizes behavior modification to make it socially unacceptable to file fraudulent claims or engage in unsafe behavior. People aren't motivated without a perceived benefit, whether the benefit is from preventing the negative or realizing the positive. To change the behavior of employees, there must be a benefit to do so. Incentive programs create peer pressure to change behavior. An ongoing awareness campaign, headed by management, creates an environment in which attention is paid to possible dangerous behavior. With this awareness goes a program which creates an environment in which there are negative ramifications to making false claims. Modifying behavior through the concept of team cooperation and individual awards dramatically reduces accidents and fraudulent claims.
10) Coordination With Group Health Programs
The difference between occupational and life style illness is very blurred. It is all too easy for unprincipled providers to steer patients into the workers' compensation system which is often more lucrative and it may have no restrictions on the amount and type of treatment that can be prescribed. The advantages of integrating the claims administration for both group health plans and workers' compensation plans are:
Duplicate claims can be identified and eliminated;
Negotiated rates, utilization controls and treatment regulation can be applied to both simultaneously;
Claims experience can give direction to both types in prevention, injury control, health education and Employee Assistance Programs;
Integrated claims processing can prepare for calculation of capitation rates for prepayment of both group health plans and workers' compensation plans
Cash incentives to encourage employees to properly report non job related injuries as such, rather than burdening their workers' compensation insurance with fraudulent claims.
If you would like to find out more about controlling your workers compensation costs, please feel free to reach out to our office.