Five Ways – Check Before Writing Workers Comp Premium Checks
Stop just writing Premium Checks for Workers Comp was the first motto that J&L used when we started over 17 years ago. Yesterday, I had two conversations on Workers Comp costs. One was with a risk management adviser and another was with an attorney.
The attorney and risk manager both were astounded that their new clients were just writing Workers Comp checks without even questioning the basis. I had said that some companies, even self-insured, look at Workers Comp as a tax. The checks are written as a way of doing business.
The two large companies were not regionally specific. One was in Florida and the other was in Illinois. I thought I would quickly cover how to stop just writing checks for Workers’ Comp. I have written on this subject numerous times in the past.
The top five methods in my opinion are:
- Question everything you receive. Do not pay for anything that you feel has not been explained to you fully. Keep asking questions when it comes time to pay a premium audit bill. Once you mail the check, you lose quite a bit of leverage.
- Obtain full online access to all claims, including adjuster notes and reserves. Even if this costs more, it is money well spent. Check your situation online often.
- Heavily question your yearly premium audit even if you received a refund or credit. I have a list of premium audit red flags you should print and keep handy.
- Follow my Five Keys to Workers Comp Savings. I wrote the list 25 years ago and nothing has really changed on them.
- Watch your fees whether or not your company is self-insured. We had been reviewing a group of claims earlier this year for a self-insured client. The TPA charged $595 per lost-time claim. The bill review and network fees added on another $1,490 per claim for a total of $2,085 per claim. This does not include the internal rehab nurse fees.
I would never want to say that an insurance carrier or TPA is dishonest. The employers were charged as according to their contract. That is why I always recommend having someone outside of the insurance carrier, TPA, or insurance agency review any Workers Comp policies or agreements and premium audits. I think the correct term is a “disinterested party.”
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