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Could Opt Out Programs End Workers Comp As We Know It?

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Non-Subscriber or Opt Out Programs – Work Comp Doom?

The Non-Subscriber or Opt out programs could end Workers Comp?   This year’s LRP Workers Comp Conference in Las Vegas was very informative.  I was searching out any new technologies, services, or products in the Workers Comp arena.Graphic of Opt Out Programs

The vendor area was surprisingly headed towards consolidation.  Some of the services that were being added in by consolidation were very interesting.   Most of the services and even the new combinations of services had all actually existed in Worker Comp in the past.

One area that was not necessarily new, but was heading towards a very rapid expansion was opt out or non-subscriber services for Workers Compensation.  The one area that astounded me was the fact that Workers Comp is treated more like a benefit or investment than a cost of doing business.

One of the reasons I deviated from obtaining a CPCU and pursued a ChFC designation is that I had always considered insurance premiums as more of an investment than a cost.  I wanted to understand more fully how insurance fits into the overall budget, not just as a necessary evil of doing business.

There was a section on the last day of the conference on non-subscriber services for Workers Comp.  The main two panelists were from Hobby Lobby and Dollar General.  I was surprised what the two employers were allowed to do with their Workers Comp programs – all in good way.

Dollar General Opt Out Picture
Wikimedia Commons – hattiesburgmemory

The two companies had a history of using a non-subscriber service in TX.  The risk manager from Hobby Lobby had mentioned the fact that Oklahoma will likely approve non-subscriber services.

The cost savings between traditional WC and the non-subscriber services was astounding.  I will post a story tomorrow or more of the intricacies of how the two companies administrated their programs.

I am traveling all day today and the info on the non-subscriber section is in my checked bag.  One thing I wanted to point out is even though non-subscriber services have been in existence in Texas for quite some time, I think many more states than just Oklahoma will look into these services.

There is a report on non-subscriber services by two Workers Comp reporters coming out very soon. I will comment on it after it is published and I have had time to examine it.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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