Workers Comp Mediations – Worth The Time and Expense?
I recently attended what I totaled to be my 60th+ Workers Comp mediations. The mediation lasted over 10 hours. I thought to myself on the way back to the office – Are Workers Comp mediations really worth the time and effort when a few phone calls among the parties would suffice?
As most of my readers already know, there are some states that order mediations when a Workers Comp lawsuit is filed against the employer and their carrier or TPA. The one that I recently attended was a voluntary mediation due to the many complexities of the file.
The mediator is the key to successful or unsuccessful mediations. If the mediator was not top notch, then the mediation would have not settled the file.
I have seen where the employer did not attend the mediations and just let the carrier or TPA handle the matter. This blog is dedicated to Workers Comp savings. One way for an employer to spend more $ than they should have is to not attend the mediations.
It is completely your money being spent if you are self insured. If your company is not self insured, the mediation costs and the settlement amounts will usually be added back into your E-Mod or X-Mod. A large settlement can affect your E-Mod for up to four years.
One of the other benefits to the employer attending the mediation is to humanize the process. The injured employee will realize they are not just suing a carrier or TPA, but have brought suit against their employer. Another benefit is that if the carrier or TPA needs settlement authority, many phone calls and confusion can be avoided.
Mandatory mediations as I had previously mentioned sometimes will require all parties to stop and look at the file to see if a settlement amount can be derived and the file can be closed – especially on smaller files.
The other side of the coin is that I have been to a mandatory mediation that settled for less than the expenses of the mediator and attorneys. Settling small files at mediation does not seem the best use of the Workers Comp mediation process.
The bottom line is the mediation process follows the 80/20 rule. Eighty percent of the mediations I have been involved with were necessary in settling the file. Twenty percent were not successful or were more of a cost factor than the settlement itself.
I will cover the elements of a successful mediation next time.
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