Bad Workers Compensation Claims

While most Workers Compensation claims are straight forward and can be resolved fairly, there are others that go bad. And then they can have an adverse effect on your organization overall cost of risk. Your experience modification factor can be increased and hurt you for three years. So it is important to stay on top of every claim. Its up to you and you insurance agent to review your claims at least annually. More if you are a larger organization with more claims.

 

These comments below are from a colleague of mine and thought they were relevant:

I recently joined a very lively conversation in the Work Comp Analysis Group on LinkedIn http://www.linkedin.com/groups?home=&gid=1328307&trk=anet_ug_hm&goback=%2Egmp_1328307

A few salient points were made:

1. Most claims are legit.
2. While it’s easy for folks to point fingers depending on their agenda, all sides impact the analysis. As an example, Paul Jahn contributed this insight:

“An interesting discussion on the perceived stigma of filing a workers’ compensation claim but all in all one that is focusing on outlier claims."

The system (in the US) typically does a pretty fair job of handling and resolving the vast majority of claims. At PERMA (where I am very familiar with the data), 75% of our claims resolve without loss of time and 80 to 90% of the lost time claims resolve with a return to work. Typically we have 10 to 15 long term litigious claims per accident year out of a universe of 3500 or so.

These claims all have to be looked at on an individual basis (and they all tend to be very high cost). I have been doing so for over 20 years and can draw some general conclusions.

1. Most claims that do not resolve in some sort of a return to work start out with a poor relationship between employer and employee.
2. Distrust between providers of coverage and injured workers can make placement in alternative employment a futile effort. An assumption of good faith on both sides could help everyone involved in the system.
3. A poor economy exacerbates systemic problem. Some employers place less value on injured workers when they can be easily replaced and in a tough job market placement in alternative employment is difficult.

As a system designed to temporarily tide injured workers over until they can return to their original employment, the system works pretty well. As a means of dealing with management issues and economic problems that complicate long term serious disability, the system is at best a band aid.”

Co-written with Don Phin, President HRthatWorks.

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5 Key NonProfit Risk Management Strategies

Welcome to my first of many monthly interviews with influential people in the nonprofit community. My goal will be to have them share something that they are successful at in hopes you can learn some best practices and implement in your organization.

Nancy Woodruff Ment, CEO
Andrus Children's Home: Yonkers, NY
Andruschildren.org
Nancy's Bio
LinkedIn

As CEO, Nancy has been instrumental in reshaping the organization’s profile through two key mergers, with the Center for Preventive Psychiatry and with Family & Community Services, Inc. Ms. Ment came to Andrus in 1987 as the Director of Clinical Services. Her career has encompassed numerous operations and executive positions in child welfare and mental health in the greater New York area. Please click her name above to get more biographical information.

1) Tell me a little about your leadership team and how risk management fits in? 
For the past 25 years, I have been in a leadership position with ANDRUS and the CEO for the last nine years. We have grown from a single site, single service for 57 children taking no public revenue to a multi-site, multi-service organization serving 2,500 children and families annually and dependent upon public sources for about 85% of our revenue. To accommodate change on that scale, we have had both to engineer and absorb change on our leadership team to be certain we have the skills and capacity in place to manage the risks that come with an expanded mission. Our management team can adapt to the world around us. We have found that it isn’t good enough to have leaders with narrow skill sets, however refined they may be. We need people who think broadly, scan for areas of vulnerability, understand how pieces fit together and value a robust team approach in addressing risk. 

2) What are some of the key areas of risk that you focus on and why? 
ANDRUS serves children who are inherently vulnerable. Our treatment philosophy is anchored in the belief that children should always be and feel safe. Safety, for us, begins with having the right people to fulfill our commitment to safety. We focus on HR processes to recruit, screen, train and supervise staff. We closely monitor our medical and psychiatric care practices because of the risk they carry. Physical plant maintenance, financial management and regulatory compliance is increasingly onerous. We devote an incredible amount of resource to addressing any concerns children, families and funders express about the care we provide. Respectful and timely attention to small matters fuels prompt corrective action, assures a reliable referral base, can prevent a lawsuit and best of all, gives disenfranchised clients the sense that their feelings matter.   

3) What are some of the outcomes you have seen by focusing on risk? 
We have built more depth and diversity on our leadership team with people who thrive on the challenges that this work and these times present. Our planning processes are more comprehensive and effective because we try to anticipate where risks lie. We have also found ourselves spending more on the front end to prevent expense at the back end.

4) What resources do you use to assist you and your team with Risk management? 
We have strong legal representation, auditing services, benefits consulting and insurance brokerage.  We have a kind of unspoken rule of thumb that any consultants and specialists we use are people we admire both personally and professionally. The work we do is highly driven by values and we want to engage with others who reflect the character and integrity for which we want to be known. Running a not for profit like ANDRUS demands nonstop on the job training. We seek consultants who are reliable in making sure we always have the most current information, the best options for managing risk and take the time to help us learn. 

5) What is the one strategy you use the most when managing risk?
Time. Even if you have a good knowledge base and access to the best advice, there is no substitute for simply taking the time to think through an issue and create an effective plan.

*Special thanks to CEO Nancy Woodruff Ment for her insight on risk management and team leadership. If you would like to view Andrus' website, just click the ANDRUS logo above.

12 Ways to Show Employees You Care

Like me, I am sure all of you always try to keep employees motivated, happy, and engaged. This can be a challenge on top of all the other responsibilities we as leaders need to focus on.

As part of my planning process each year I always try to schedule some time to send notes to employees. Either for something I heard about from a client or a coworker. I actually have written some notes and sent them to their homes. Not a lot of effort but it goes a long way.

Our company holds an employee appreciation breakfast each month on the final Thursday. We provide breakfast and a short agenda that includes the following:

1. Open conversation, Networking
2. Celebration of special days - Birthday, anniversaries, milestones, promotions, professional development and other celebrations
3. We celebrate any new accounts that have joined Rollins in the last month
4. We read out any accolades received from clients about team members
5. We ask all team members to thank any fellow team members for any special effort on their part. This is always a great love fest!
6. We briefly review any official Rollins messages we need to share.

We have been doing this for 10 years now and it is the highlight of our month. Getting everyone in the same room once a month to share positive news is always a great motivator.

Click the button to the right which will provide an outline of 12 ways in which you can show employees you care. Instead of trying all of them, try at least one and bring more on as you can.

 

 Please take a minute to leave a comment below.

3 Human Resource Strategies to Reduce Health Insurance Costs

We are deep into open-enrollment season, that time of year when many companies roll out changes to their health insurance plan. Some of the changes will be increased costs, higher deductibles and narrower networks.

It is more important than ever to communicate these changes to your employees pro-actively and find ways to minimize the cost increases. This can be accomplished at open enrollment meetings. It is a great time to inform employees what is happening to the benefits program being offered, what is happening within your organization and what is happening that will directly affect them.

We use this time with our clients to build a message that delivers the news with as much positive slant as we can. It’s hard to tell them that their contribution is going up or that the co-insurance is changing and have it come across positively. There are 3 strategies to to soften the financial impact on employees with plan design changes.

One of the ways is to implement a tax savings account such as a Health Savings Account (HAS). Simply said, this is a tool that increases the plan deductible for everyone which reduces the plan cost. Your organization sets aside some of that savings to offset for everyone's increased deductible. This is usually a win win for everyone.

Another one of the tools we use is plan design. We find so many times that plans offer only one plan and it is the “Cadillac” plan. The plan is the best one available but also the most expensive. A quick study of utilization will tell you if offering lower cost plans as an option is a better way to go. This will reduce the cost for everyone.

Another strategy is to implement a Wellness program. This will have a long term effect on your human capital investment but also your health insurance costs. There are many ways to start a wellness program and many resources that go with it. But it must be a culture change within your organization.

So these are three strategies you can use to reduce your costs, improve employee morale and communicate a positive message.