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Home » Archives for February 2019

Archives for February 2019

WCRI Annual Conference 2019 – Live Blogging – If My Wrists Hold Out

February 28, 2019 By JL Risk Management Consultants

First Day – Morning Conferences – WCRI Annual Conference 2019 – Live Blogging 

If I make mistakes in this live blogging of the WCRI Annual Conference 2019, please excuse, this is live and I do not really go back and change  anything

Beginning of WCRI Annual Conference 2019 Presenters

KEYNOTE: PROF. ALAN KRUEGER

 

WCRI Conference 2019 picture of Dr. Krueger

Considered one of the 50 highest-ranked economists in the world, Princeton University’s Professor Alan Krueger will kick off this year’s conference with a keynote focused on the future of work and the impact of technology on the economy, and how the opioid epidemic has affected the labor force participation rate ─ the proportion of people employed or looking for work in the U.S.

Krueger will also share his experience working in Washington as the former chair of the White House Council of Economic Advisers (CEA) and as a member of President Obama’s Cabinet from 2011 to 2013. He is the only economist to have served as the chief economist of both the U.S. Department of the Treasury and the U.S. Department of Labor.

 

Moderator: Dr. John Ruser, WCRI
 

Speaker: Dr. Alan Krueger, Princeton  

Dr. Krueger Presentation 

Opioids

  • Chart of Overdose rate – 250% increase in overdose 
  • 70,000+ American died of drug overdose – 2017 
  • Male drug overdoses seems to have increased more sharply in the last few years 
  • Mortality rate is rising for white non-Hispanic Americans 
  • Death of despair – Lower educated Americans tend to have much high rates of drug overdose mortality 

Fentanyl is responsible for over 30,000 deaths in 2017 <<<amazing 

Labor Force – Ages 25 – 54 

  • Men participation in labor force has dropped approximately 10% 
  • More than 40% of unemployed men report being unhealthy (fair or poor)

Men out of workforce reported taking pain medication yesterday – 47% 

  • Only 12% said that a work injury was responsible – Most chronic pain sources happen outside of work 

Women out of workforce reported taking pain medication yesterday  – 34% 

Regional use of pain medication varied by 3,100% by county across the US 

Macroeconomic effects – Opioid Crisis

  • Value of Statistical Life = $10 Million 
  • Cost of opioid crisis – $500 billion – $750 billion 

Public Policy

  • Trump administration declared public emergency
  • Limit number of pills prescribed 
  • Better emergency room treatment for those overdosing 
  • Alternative treatments for pain 
  • Beware of next drug epidemic 

Q&A 

Progress have been made in the area of pharmaceutical abuse 

  • More help for those addicted 
  • ?

Many of the jobs from lower educated workforce have been eroded 

Demographic transition – especially the aging of the workforce 

Dr. Ruser – Within 3 months – new study will be released by WCRI that shows a decrease in opioid use. 

WCRI Annual Conference 2019 – Morning Session 2

LATEST RESEARCH & EFFORTS TO ADDRESS THE OPIOID EPIDEMIC

 

2019 WCRI Conference Picture of pills on keyboard

During this session, WCRI will present its latest research on correlates of opioid prescribing to injured workers, which can help public officials and other stakeholders better predict which injured workers are more or less likely to receive opioids.

Next, the Massachusetts Department of Public Health will discuss the results from a recent study they published on factors that may contribute to differences in the rate of opioid-related overdose deaths among workers in different industries and occupations.

 

Then, the session switches from research to the efforts taken by Arizona Gov. Doug Ducey and the Industrial Commission of Arizona to address the opioid epidemic in their state.

 

Moderator:

  • Tim Hassett-Salley, WCRI

 

Speakers:

  • Vennela Thumula, WCRI
  • Letitia Davis, Massachusetts Department of Public Health 
  • Jacqueline Kurth, Industrial Commission of Arizona
  • Jason Porter, Industrial Commission of Arizona

Ages/Local Prescribing/Industry Differences in Opioid Use – Dr. Vennela Thumula, WCRI

Highest use

  • 40 to 54 age group – 38% 
  • 54 to 60 age group – 34% 
  • 72% of use in these two age groups 
  • County breakdown – Nevada seems to be very high
  • Mining and Construction workers had the highest rates of opioid prescribing 
  • Employed in smaller firms 
  • Older
  • Male 
  • Residing in rural areas 

Opioid-related Overdose Deaths in Massachusetts – Letitia Davis, Massachusetts Department of Public Health

  • Massachusetts has double the national average of opioid deaths
  • Used CDC info extractions for 2011 – 2015 
  • 5,580 opioid deaths in that timeframe
  • 9 industries with higher rates than normal
    • Construction – very high – 6 times the average
    • Fisheries – even though number of incidents much lower -6 times the average
  • No clear cut trend by income <<<interesting 
  • No race/ethnicity figures

 

Jason Porter, Industrial Commission of Arizona 

  • 2017 – Arizona had highest rate of opioid  death in 10 years 
  • 33 opioid pills prescribed for every AZ resident – what???<<amazing 
  • Governmental task force Act on opoiods enacted by Governor – Started January 1, 2019
  • AZ clamped down on opioid prescribing and use 
  • AZ Opioid Abuse Act 
  • 36% decrease in opioid prescriptions 
  • Opioid antidote – Naloxone 1,100 doses given with 97% 

Opioid Treatment Guidelines – Jacqueline Kurth, Industrial Commission of Arizona

  • Advisory Committee – had claim reps on committee<<good idea 
  • 10/1/2016 – Treatment guidelines and ODG went into effect 
  • Less use of opioids – Oxycodone reduced by large % according to NCCI 

FROM WASHINGTON STATE TO WASHINGTON, D.C. – A MODEL FOR COORDINATED SERVICES

 

Washington State has shown that creating a community-based program that brings together medical providers, employers, and injured workers helps ensure timely, effective, and coordinated services for injured workers. Now efforts are underway by the U.S. Department of Labor’s Office of Disability Employment Policy (ODEP) to pilot this program in eight other states.

A distinguished panel will talk about the origins of this program, what makes it successful, and the potential lessons that can be learned by stakeholders.

 

Moderator:

  • John Ruser, WCRI

Speakers:

Prof. Tom Wickizer, Ohio State University College of Public Health

  • SSDI – 1/3 were through Workers Comp system 
  • 90 days is a maximum timeline before return to work problems

Jennifer Sheehy, U.S. Department of Labor’s Office of Disability Employment Policy (ODEP)

  • RETAIN – Retraining Employment and Talent After Injury Network 
  • RETAIN Phase 1 Awards Announced
    • California
    • Connecticut
    • Kansas
    • Kentucky
    • Minnesota
    • Ohio
    • Vermont
    • Washington

 

First Day – Afternoon – WCRI Annual Conference 2019 – Live Blogging 

UNIONS AND MANAGEMENT: CREATING A SUCCESSFUL RETURN-TO-WORK PROGRAM

 

In keeping with our conference theme, Dr. Cameron Mustard, president and chief scientist at the Institute for Work & Health (IWH), will present his research on the challenges and successes in implementing a comprehensive and collaborative return-to-work program for a large acute-care hospital system employing 4,000 people.

 

The hospital became concerned about the high costs of workplace injuries and illnesses. Explicit policies and procedures had not been developed for supporting those on sickness absence to return to work. Accordingly, the number and duration of its workers’ compensation claims were double those of its health-care sector peers. To turn this around, the hospital and its three unions worked together to develop and implement an innovative, evidence-based return-to-work program.

 

The findings Dr. Mustard shares may provide helpful guidance for organizations embarking on the development and implementation of a return-to-work program.

 

Moderator: Andrew Kenneally, WCRI

 

Speaker: Dr. Cameron Mustard, Institute for Work & Health

 

Canadian Based 

Return to Work – Accommodation policy 

James J Moore   My personal experience is that Unions can be tough places to return an employee to gainful work due to the many agreements that caused complications on light duty, or modified work.  

7 evidence based principles for return to work 

  1. Safety driven
  2. Employer has to offer work
  3. Does not negatively impact coworkers 
  4. Early contact after return to work after accident by supervisor
  5. Supervisor are trained in work disability 
  6. Someone has the responsibility for return to work 
  7. Employers and providers communicate with each other 

 

Methods

Process evaluation – Qualitative interviews with supervisors

Outcome evaluation – quasi-experiment 

Outcomes 

Disability duration days reduced from 19 to 10

GROUP HEALTH DEDUCTIBLES AND WORKERS’ COMPENSATION

 

Previous research offers evidence that a sizable proportion of workers with work-related injuries do not file for workers’ compensation, suggesting that filing for workers’ compensation may involve some costs to the worker, whether actual or perceived.  
 
However, as high deductibles increase out-of-pocket costs for injured workers receiving medical treatment through their group health plan, they may find filing for workers’ compensation coverage more attractive, especially since medical care under workers’ compensation has no cost-share component.
 
In this session, WCRI’s Dr. Olesya Fomenko will present the Institute’s research on the relationship between deductibles in group health and filing in workers’ compensation.

 

Moderator: Ramona Tanabe, WCRI
 

Speaker: Dr. Olesya Fomenko, WCRI

I wrote an article on this study at this link. 

When workers are facing high deductibles for their health insurance, the employees may file for workers compensation coverage. 

No deductibles or co-payments in workers comp. 

In 2017 workers were responsible for over 81% of their deductible – it was 59% in 20018

Annual deductibles grew from * in 2008 to * in 2017 

Do workers actually substitute Workers Comp for health insurance  – case shifting 

Reasons for workers not filing Workers Comp claims 

  • Lack of info
  • Employers discourage filing a claim
  • Stigma and loss of bonuses/overtime pay
  • Availability of health care coverage

Findings

  • Workers respond to higher deductible insurance at the the time of injury
  • Increase in WC filing concentrated in states where workers choose their initial provider 
  • Not much difference in states where the employer controls initial provider choice 

INNOVATIVE EMPLOYER IDEAS WCRI Annual Conference 2019

Time: 3:15 p.m. – 4:15 p.m.

 

Across the country, employers are taking innovative initiatives to ensure those injured at work receive the support they need and return to work.

In this session, a panel of large, well-known employers representing different industries will engage in an open and free-wheeling conversation about the workplace, innovations they have implemented to handle workers’ compensation issues, and what significant challenges they’re focused on now and in the future.

 

Moderator:

  • Laure Lamy, WCRI

Speakers:

  • Dawn Goree, Director of Workers’ Compensation at The Home Depot
  • Marc Salm, Vice President of Risk Management at Publix Super Markets
  • Noreen Olson, Workers’ Compensation Claims Manager at Starbucks Coffee Company

Question on Innovations 

Starbucks – Injured workers receive the same level of care as the customers 

  • Advocacy Model
  • Transparency
  • Challenge Status Quo of claims handling 
  • Self Reporting without going through manager 
  • Call into claims center to file claim 
  • Direct deposit of claim payments 
  • Calls from claims examiner and from Starbucks contact 
  • Early Return to Work 
  • Telephonic Nurse Case Managers > Self Care
  • Physician partnerships – knowledge of barista job functions 

Home Depot 

  • Employee advocacy model
  • Nurse case manager involved early in the process 
  • Non-adversarial

Publix 

  • Full claims self administration 
  • Nurse Case Managers
  • Two industrial medicine clinics
  • Tele-medicine pilot
  • No TPA involved 
  • Nurse Case Managers – exception reporting 
  •  Physician scorecard provided by Encompass

Changes in Workforce – Aging, etc. 

Home Depot 

  • Nature of the work makes colleagues 
  • Very different workforce – melting pot 
  • Aging workforce challenges – comorbidities – pre-existing conditions 

Starbucks 

  • Most workers are younger than average 
  • Commitment to hiring veterans, the disabled,  refugees

Publix

  • Large amount of aging workforce 
  • Warehouse database of comorbitiies and other statistics 
  • Changed a large amount of employment forms 

Litigation Changes 

Publix 

  • Legal fees increasing in all states 
  • Increase in $150K+ (within 24 months) or greater claims
  • 2015 Supreme Court decision made Florida much more costly – increase legal fees 
  • Claimants’ legal fees have increased significantly, Employers’ legal fees flat 

Home Depot

  • Advocacy model including claim partner vendors 
  • Golden Rule 
  • Walk the Talk
  • Prevent distrust means lower litigation 

Starbucks 

  • Thinking about the end result of the process 
  • How will this life-change affect the injured employee? 
  • Education of the Workers Comp system lowers litigation 
  • Moment of opportunity

WCRI

  • From their studies – Trust is tantamount 

Q&A

Most pressing challenge – Publix Legal Fees,  Home Depot comorbities and  Starbucks return to work 

Communication with millennials –  Home Depot -, Starbucks – it is a problem, use smart technology, push text and regular texts, return call monitoring, Home Depot – captive audience (?) 

Medical control Publix In only medical control states, Starbucks – partnering with first in class physicians – local providers, text medical information guide

How immediate contact to the employee is managed post-accident Publix – workplace culture   Home Depot – workplace culture, help employees through the Workers Comp process

2nd Day – Morning Conferences – WCRI Annual Conference 2019 – Live Blogging 

STATE OF THE STATES: SELECTIVE FINDINGS

Time: 9:30 a.m. – 10:15 a.m.

 

This session will discuss some of the latest findings and trends seen across WCRI’s core benchmark studies, including WCRI’s 18-State CompScope™ Benchmarks reports, a multistate benchmarking program that measures the performance of a growing number of state workers’ compensation systems.

This session will be helpful to stakeholders and public officials who are looking to better manage change and control costs while improving outcomes of injured workers.

Speakers:

  • Carol Telles, WCRI, Facility Costs and Use: Factors in Interstate Differences and Trends
  • Evelina Radeva, WCRI, Comparing Benefit Delivery Expenses
  • Rebecca Yang, WCRI, Frequency, and Costs of Lump-Sum Settlements

Carol Telles, WCRI, Facility Costs and Use: Factors in Interstate Differences and Trends

Facility payments Accounted for 17% of all medical payments 

44% of Iowa claims had facility payments 

Georgia had very high facility payments – ASC’s  >20%

25% of claims had facility payments in New Jersey-ASC’s 

Louisiana had highest facility payments – 12,500+ – ASC’s

North Carolina had largest decrease in Hospital Outpatient services – decrease of 10% 

  • Fee Schedule changed to Medicare Basis 
  • Immediate reduction in use and payments of Hospital Outpatient Services 

California had 5% decrease in major surgery between 2011 and 2017

  • Alternative to surgeries used 
  • Active payor management
  • Changing in surgical mix 

Neurological spine pain injury decreased from 28% to 21% 

Iowa had 20.8% reduction in Low Back disc surgery from 2011 to 2017 

North Carolina was only state with ASC reduction facility payments = -9%

New Jersey increased 50% payments to ASC facilities 

Increase of network may impact ASC payments 

Evelina Radeva, WCRI, Comparing Benefit Delivery Expenses

Benefit Delivery Expenses (BDS)

Typical Study State Lost time claim $42,000

BDS = 15% of claims cost

Medical Cost Containment and Litigation Costs 

TX, NJ, CA had highest BDS – CA = 22% 

NJ had highest Medical Cost Containment

LA had highest litigation expenses 

LA had 31,082 of medical cost containment and medical expenses 

Iowa and NJ have no fee schedules <<<

LA has highest defense attorney costs = $7,300

LA, CA, and NJ had highest growth rate  in BDS costs 

LA and NJ had highest growth in Medical Cost Containment costs 

Defense attorney costs almost doubled between 2011 and 2017 <<<<wow

Rebecca Yang, WCRI, Frequency, and Costs of Lump-Sum Settlements

Workers Comp system designs had effects on lump sum settlements 

  • Type of benefit
  • PPD benefits 
  • Limitations 
  • Speed of system 

Large variations of % of claims with lump sum settlements 

40% of claims have lump sum settlements in IL 

PA almost $60,000 lump sum settlement averages 

FL had the most early settlements 

MI had the most late-claim settlements 

14 states were flat in lump sum settlement growth 

 

CHALLENGES & OPPORTUNITIES OF TELEMEDICINE

 

Telemedicine can speed care to injured workers, especially those in remote areas; enhance the patient experience; and reduce costs for payors. However, there are also concerns about reimbursement for physicians, quality of care, privacy, and other issues. 

Our seasoned panel ─ made up of a senior policymaker from a large state, a veteran medical practitioner, a large employer, and a labor official ─ will discuss the opportunities and challenges associated with this innovative model for delivering medical care. 

 

Moderator:

  • Dr. David Deitz, David Deitz & Associates

Speakers:  Two others below 

  • Dan Allen, Construction Industry Service Corporation (CISCO)
  • Dr. Stephen Dawkins, Caduceus USA

Dr. David Deitz

Geography and Age were major determinants of Telemedicine use 

  • Older patients 
  • Rural patients 

Really no studies on Workers Compensation and telemedicine 

Telemedicine covers major intersections drivers 

  • Medical technology 
  • Value-based medicine 
  •  

Kurt Leisure, The Cheesecake Factory

Nurse Case Management Model – Nurse Triage >>transfer to tele-doctor 

24/7 accessibility to treatment – immediate medical care -RX to pharmacy of employee’s choice 

Bilingual physicians 

Employee may never have to leave worksite to receive treatment<<<Interesting 

Concern – Adoption by staff 

$153,000 (estimated) in 2018 hard dollar savings 

 

Amy Lee, Texas Department of Insurance

Senate Bill 1107 changed medical practice rules 

Before SB 1107 – only face to face Dr. appointments 

How to incorporate telemedicine into Work Comp medical network? 

How to make sure that employee has choice of medical practitioners 

Rule 133.30 – Defined telehealth and telemedicine 

Study data is limited – 100 claims as of 9/1/2018 

Q&A

Quality of care – when the employee asks for an in-person Dr. visit – 

  • Cheesecake Factory – employees always have the option to see another Dr. 
  • State of Texas – choice = satisfaction, full explanation to injured employee

Equipment Issue>>Bandwidth>late adopters to technology

  • State of TX – rural parts of TX have low quality internet, 
  • CISCO – Technology clinics at Union Halls 

HAS THERE BEEN AN EROSION OF WORKERS’ COMPENSATION BENEFITS?

WCRI Conference 2019 Picture of CEO John Ruser

Workers’ compensation benefits as a share of payroll are at their lowest level since 1980 and this share has been declining for over a quarter century. Some point to a legislated erosion of workers’ compensation benefits, but data suggest that many factors account for the decline.

 

In this session, WCRI CEO Dr. John W. Ruser will highlight contributors to this trend, emphasizing the ubiquitous declines in injury rates and workers’ compensation claim rates that are partially offset by increases in injury and claim severity. John will also identify factors responsible for these offsetting trends, including improvements in safety, changes in the mix of jobs and compensability rules, the aging workforce, and economic conditions. 

 

Speaker: John Ruser, WCRI

Now –  83 cents is paid in benefits for each $100 in payroll 

Many other factors may have been responsible for possible erosion in benefits 

Dramatic decline in frequency of workers comp claims 

BLS – injury rates are 1/3 of what they were in 1994

Decline in frequency in the US is very similar to European decline rates 

Global factors are responsible for decline in injury rates 

Reductions are industry-specific (internally)

  • Manufacturing 
  • Trade, transportation, and utilities 

Injury rates declined  41.9% for Construction between 2008 2017 

Overexertion injuries fell 69% between 1992 and 2010 

Contact with objects injuries fell 64% 

Underreporting of injuries 

  • Employer – Avoid OSHA inspections,, Lower WC premiums
  • Workers – fear of being fired, loss of wages 

Type of injury reduction – BLS – Sprains – 75% reduction

End of WCRI Annual Conference 2019

 

©J&L Risk Management Inc Copyright Notice

 

 

 

 

 

 

Filed Under: WCRI Annual Conference Tagged With: Alan Krueger, CEA, chronic pain, fentanyl, keynote focused, non-Hispanic Americans, Princeton University, refugees

Workers Comp Claim Analytics – Looking For Miracles Under Every Rock

February 22, 2019 By JL Risk Management Consultants

Workers Comp Claim Analytics – Hot Subject Leaves Me Cold 

Most workers comp claim analytics posts I have written was in search of a good claim analytics package.   Unfortunately,  my search ended up like my search for workers comp apps – disappointed with still a hope for the future.

picture of man swimming workers comp claim analytics

Wikimedia- Oleg Dubyna

Company names have been left off my critiques.  My basic point is for the claim analytics field for workers comp in total.

My review started with a claims analytics package in the 1990s.  Yes, a few rehabilitation companies offered workers comp claims analytics software which was very limited in what it could produce for a claims or risk management department.  

My review of these packages now involves consulting for a few carriers, TPA’s, and mainly self-insured/ large deductible employers.   In the 1990’s I ran a very large governmental based TPA operation.   The software used had a few modules that actually had a few good variables. 

The variables had to be extrapolated a few times.   However, the results were a very basic “yellow flag” on overcharges for certain pharmaceutical concerns.   The PBM (Pharmaceutical Benefit Management) software covers that well.  This, to me, was not real claim analytics.  With an actuarial and statistical background, I hungered for more.  I knew it was only a matter of time.   

Now – 20 years later – the search for true workers comp claim analytics still leaves me wanting.   The data is there, but one fault remains.   

The psychological component and healing factors post-injury cannot be drawn on a graph or forecasted for any group of claims.   Why? – No two people are alike with the butterfly effect driving the statistics. 

I still today challenge any company that has claim analytics to please let me log in or send me a disc for offline software where I could at least have a few good red flags.  If you see this article and have workers comp claim analytics software – please no beta versions.   If your software creates results which are helpful to a claims or risk management department, I will laud your software.  

I have sampled a ton of claims “processing” software with analytics as a backdrop at the NWCDC Conferences over the years.   The claims processing end of most TPA/employer claims packages were beyond excellent.  

The Best Analytics Right Now

The best analytics package right now sits at their desk adjusting claims for years.   An experienced and talented claims adjuster usually can predict how a claim turns out long before claims development (5 – 7 years experience).  

Why? – At five years – an adjuster has seen most claims situations.  The adjuster has a claims load of familiar employers.   At seven years in the claims business, most, not all,  claims adjusters become “claims whisperers.”  They have developed a gut instinct superior to any software of any type of claims reviewer.   

One caveat – the adjuster must have performed a full (no loose ends) investigation into the claim within 48 hours after the injury.   If this does not occur, the results will degrade from the start. 

Secret/But Not So Secret Software 

Hold on, one work comp claim analytics software does exist.  I use it all the time.  The software remains very reliable to date.  The 1990’s claims processing package used this software successfully for data analytics.   The answer is: (hold it, think about it) 

Excel(R)  or Open Office (R) <<Open Office is free for non-commercial operations.   Yes, Excel (R) – thanks Bill Gates- remains one of the best workers comp claim analytics packages today.   Why? – Because I can search and sort the data any way that I want to find those data outliers or trends. 

I have used it as an Expert Witness on claims lawsuits.  Make sure you have the statistics package downloaded into the software.   I use Office 365 – so the statistics package is automatically included for my use.   What statistics should you use?   The most powerful one that I use the most is Regression for forecasts and Custom Sort.  Custom Sort can be found in the main Excel ribbon.   

Over the weekend, I will be sampling an online workers comp claims analytics package.  Wish me luck! 

 

©J&L Risk Management Inc Copyright Notice

Filed Under: Analytics Tagged With: beta versions, beyond excellent, critiques, extrapolated, non-commercial

High Health Insurance Deductibles Cause Case Shifting – WCRI Study

February 21, 2019 By JL Risk Management Consultants

Larger Health Insurance Deductibles Cause Employees To Use  Workers Comp

The health insurance deductibles have been raised over the past few years.  One reason could be the Obamacare Federal and State Insurance Exchange insurance carriers wish to negate the effect of having to insure all-comers with pre-existing conditions.   

health insurance deductible

Wikimedia Zeurgezi

A recent study by WCRI (Workers Compensation Research Institute) showed that higher health insurance deductibles led to case shifting.  WCRI has covered case shifting before in various studies and their annual conference.  

Case shifting occurs when an injured employee looks to lessen their risk by shifting an injury from one line of insurance (usually health) to workers compensation.    

The recent study results from WCRI on health insurance deductibles and case shifting recent press release covered a few salient points.  

The following is a sample of the study’s major findings:>>>my comments in italics

  • Workers with a higher remaining group health deductible at the time of injury are more likely to file under workers’ compensation than under group health insurance.>>>This should be seen as not really a surprise.  
  • Injured workers are about 1.4 percentage points more likely to file a workers’ compensation claim when they have a remaining deductible of $550 (the average) compared with a zero deductible at the time of injury, amounting to a 5.3 percent increase in the workers’ compensation claim volume.>>>A deductible of $550 seems low nowadays
  • The increase in propensity to file for workers’ compensation coverage in response to higher deductibles is even greater for injured workers with soft tissue conditions.>>>This is a very interesting finding.
  • The increase in filing for workers’ compensation coverage is concentrated in states where employees can choose their initial provider. This may reflect the ability within workers’ compensation of workers to remain with their group health doctor in these states.>>>This makes sense.  I totally agree with that assessment. 

The study also estimated the increase in workers’ compensation volume from the growth in high deductible group health policies. The increase partially offsets the overall decline in workers’ compensation claims seen over the past decade.

You can found out more information on the study and purchase a copy here.   A video from one of the authors explaining the study further is also included on the page. 

©J&L Risk Management Inc Copyright Notice

Filed Under: WCRI Tagged With: negate, Obamacare Federal, State Insurance Exchange

Pennsylvania Employers – Workers Comp Premium Refunds Possible

February 14, 2019 By JL Risk Management Consultants

Pennsylvania Employers – Left In Limbo On Workers Comp Premiums  

Pennsylvania employers likely experienced overcharges on recent workers comp policies and audits.   

pennsylvania employers state flag

Wikimedia Commons – Simtropolitan

A previous article was published on who is to blame when the rating bureaus make a mistake.  Pennsylvania recently experienced system-wide workers comp premium overcharges due to a carrier misreporting their data to the PCRB (Pennsylvania Compensation Rating Bureau).  

When a very large carrier in a certain state does not report the proper insurance rating data, then all employers data incurs a ripple-effect of inaccuracy.  In fact, the overcharge was estimated at $250,000,000.  

The main question in 2018 was – Did the PCRB have the proper data safeguards in place to catch when a carrier accidentally misreports their data?  My main question was – will Pennsylvania employers receive their proper premium refunds?   The premium overcharges were beyond obvious. 

If an employer’s workers compensation experience rating information is incorrect, then the company did not pay the correct premium. 

My question for 2019 was – Did the workers comp carriers refund the overcharges to Pennsylvania employers?  My question was answered in two parts.  

Two Questions For Pennsylvania Insureds

Two questions that I thought should be asked by Pennsylvania policyholders are:

  1. Did the proper insurance authorities order an immediate refund?  No, in fact, the Insurance Commissioner Jessica Altman said that “carriers should do the right thing.”  I have not seen to date where any carrier had produced a press release on refunds to employers.  
  2. What did any carriers do to correct the mistake?   SWIF – The State Workers Compensation Insurance Fund published a press release of sorts by writing a letter to the Commissioner Altman adjusting the Loss Cost Multipliers to lessen the affect of the overcharges.    One has to congratulate SWIF on their proactive stance.  However, the LCM’s affect the future – what about the overcharges that Pennsylvania employers incurred in their past policies?  

Should Pennsylvania employers contact their carriers and agents?  Yes, but make sure that you have your “ducks in a row.”  Never contact your carrier with a grievance on overcharges without the proper numbers down on paper.   That type of contact has backfired on many unprepared employers in the past. 

Pennsylvania employers – feel free to contact me with questions. 

 

©J&L Risk Management Inc Copyright Notice

Filed Under: Pennsylvania, Work Comp Premium Overcharges Tagged With: PCRB, ripple-effect, SWIF

Workers Comp Premium Auditor Does Not Know My Final Bill Amount?

February 13, 2019 By JL Risk Management Consultants

Workers Comp Premium Auditor Billing Question From LinkedIn 

Recently, one of our devout employer article readers posed a workers comp premium auditor question to me through LinkedIn.  By the way, my LinkedIn profile is located here.   You can follow me on LinkedIn for posts and newsletter updates. 

workers comp premium audit bill picture

Public Use License Missouri History Museum

The LinkedIn reader wanted to know – I just called/emailed my workers comp premium auditor about our final bill.   She was in six weeks ago to do our final premium audit for the year.   She said that she had no idea on the final premium audit bill amount.   I am flabbergasted.   She did the audit, but cannot discuss the bill – why?   Was that not her job? 

Answer – I do not want to disappoint, but she correctly answered your inquiry.   The job of the premium auditor almost always does not include anything to do with the billing of the final premium audit.   The final tally comes from a totally different department – the premium audit billing department.  

The premium auditor’s main job consists of reviewing your company records to come to a final audit amount – not the final bill.   If there was something inaccurate on the premium audit itself, then you can dispute it within the rules of your policy.   A premium audit dispute can correct what you may think is inaccurate with your bill.   

The work comp premium auditor’s job stops just short of calculating your final bill.  However, the final bill does come directly from the premium auditor’s work.   The main information that you should request from the premium auditor is the auditor’s workpapers.   The workpapers usually show step-by-step of how your premium audit was conducted.    You do have a right to ask for the workpapers.   

The premium auditor WILL NOT be able to provide you with a final bill.  Your company will usually receive a premium audit adjustment statement along with the audit.   The workpapers usually are not included with the premium audit statement (PAS).  

Phone calls are not recommended if you have a dispute or question or your bill amount.   Email or write your questions to the address or email address on the Premium Audit Bill or Statement.  Why do I not recommend phone calls?  Your dispute rights are not preserved with a phone call. 

 

©J&L Risk Management Inc Copyright Notice

 

Filed Under: Premium Auditor Tagged With: flabbergasted, LinkedIn, PAS

Workers Compensation Fraud In New Jersey – Video Says It All

February 6, 2019 By JL Risk Management Consultants

Workers Compensation Fraud – New Jersey Man Caught on Video

Workers Compensation fraud appears very rarely in the articles on this blog.  (Why?)   The subject remains one of the most overused and overwritten subjects since I first started in the business in the last part of the 1980s.  

workers comp fraud picture french shell game

Wikimedia License – FaceMePLS

The Workers Compensation newswires and blogospheres lit up the scoreboard with a video obtained by CBS News.  The video- see the end of the article for link shows a very feeble attempt at workers compensation fraud by an employee.  

As you may already know, three types of workers compensation fraud are the most prevalent:

  1. Employer – finding  illegal methods to not pay for the company’s workers comp risks
  2. Employee – intentionally filing for benefits not owed 
  3. Provider – billing for services not provided to the injured employee 

Many years ago, a study was conducted – by a now-defunct carrier – that covered the elements of fraud.   Three percent of claims started with an element of workers compensation fraud.  As the claim progresses, the likelihood the same claim contains an element of fraud increases to 30%.   

An assumption would be that the element of fraud could be from one of the three listed above, and not caused just by the injured employee. 

One of the areas that Predictive Analyses made at least a few inroads was in the area of fraud detection at the beginning of a claim.   I had seen some success identifying certain factors that pointed towards a claim that could have workers comp fraud.   

No big breaking news stories were published on fraud detection using Predictive Analytics.   An experienced workers compensation adjuster, to me, can be the best detector of fraud during a claim.   Every adjuster (medical only and lot time) possess an innate ability to know when a claim heads off the rails.  

One of my pet peeves on workers compensation fraud detection came from a list I was provided by my employer 25 years ago.   The list contained a few suggestions as to what claimants might have an ulterior motive in filing a claim.    

The list contained – has a PO Box.  After having my credit card numbers stolen in the 1990’s out of my residential mailbox and multiple accounts opened using the ill-begotten info, I have used a PO Box for at least 25 years for credit card fraud avoidance.   

I do not think there exists one bellwether on whether a claim will have some fraudulent element.   One that used to concern me when I was handling a full claims count was injured the first day of beginning a job.    My opinion was changed somewhat after learning how much The Learning Curve affected a new employee. 

OK, so the link to the video is here.   The man in the video has been charged with but not convicted of workers comp fraud. 

 

©J&L Risk Management Inc Copyright Notice

Filed Under: fraud Tagged With: CBS News, Learning Curve, PO Box, Predictive Analyses

Medical Only Claims Adjusting – One Super Critical Task To Consider

February 1, 2019 By JL Risk Management Consultants

Medical Only Claims Adjusting – Where Small Claims Can Turn To Crises 

Most Medical Only Claims Adjusting sections in a claims processing manual consist of a very few pages.  Lost time adjusting takes up the majority of a TPA or insurance carrier claims manual.   

medical only claims adjusting picture large wave breaking

Wikimedia Public Use License Broken Inaglory

The Medical Only claims adjusting section may or may not cover what is just as important as any Lost time adjusting task.   The recognizing, converting, and immediately handling of a medical only claim that has become serious has wrecked more than a few employer’s loss histories.  

If a small claim festers lacking any administration/adjusting,  the claim will likely end up being a non-investigated, expensive, out of control mess.   Some claim systems will catch a small % of these claims.  Those systems are few and far between.   

How are small claims that are turning into uncontrollable claims discovered?   The usual ways involve:

  • Twilight Zone Phone Call 
  • Employee is denied an unauthorized treatment by medical provider
  • Employee’s newly hired attorney sends in representation notice
  • Employee calls into claims department to complain about no TTD checks
  • Claims reserves peg at higher than normal level for a  medical only claim 
  • Claim stays open for months/years 
  • Claim is reopened and then re-closed multiple times to pay bills over a long period 

Most medical only claims adjusting staffs and lost time adjusters could add on many more items to this list. 

Some claim departments required a recorded interview on even medical only claims.  This sickening requirement caused these claim departments to become overloaded in pending recorded statements.    Most claim departments which required recorded statements on all claims changed the task to a recorded statement on all lost time claims and serious medical only claims. 

Over the years, I have met and supervised great medical only claims adjusters that had a gut feeling when a claim was souring and going to be more costly than just a small amount of medical bills paid in the first few weeks. 

Employer Role In Medical Only Claims Adjusting 

I then discovered one of the techniques of these great medical only claims adjusters.  They had established great two-way communications between themselves and the insured.  The adjusters had a great open door policy for the employer to call them if they noticed anything suspicious or extraordinary occurring on even the smallest workers compensation claim. 

Even if your company does not have this type of communication and relationship with your medical only adjusters, go ahead and start on it today.  If you see anything strange on a medical bill, or if a large medical bill is received on a medical only, let the medical only claims adjusting staff knows about it immediately.   

If the employee has an unexplained absence after reporting a medical only claim, get in touch with the medical only adjuster as soon as possible. 

Email your medical only claims adjuster instead of calling in most cases.   The email will allow the adjuster time to pull up the file and then discuss it with the lost time adjuster or medical only claims adjusting supervisor. 

 

©J&L Risk Management Inc Copyright Notice

Filed Under: Medical Only Claims Tagged With: extraordinary, festers, non-investigated, suspicious, uncontrollable

PEO Data Session – NCCI Data Conference Earlier This Month

February 1, 2019 By JL Risk Management Consultants

PEO Data Session – Great Info from NCCI Data Conference 

The PEO Data class from the NCCI Data Conference provided a treasure trove of great info nuggets.   The Data Reporting Conference remains of the best sources of great info on workers compensation.   Check it out here.    

PEO data workshop picture meeting room

Public Use License – Meeting Rooms 4

The session of PEO Data Reporting covers 77 pages of info from the class manual.   I will point out a few nuggets of information.  I recommend downloading the complete PEO Data Reporting manual by clicking here.    The manual may require a few minutes to download – please be patient. 

Page 3 of the NCCI PEO data presentation contains the NAIC definition of a PEO.  

A business entity that enters into agreements with other businesses, whether under a formal contract or otherwise, under which the PEO assumes or shares employment responsibilities for all or a significant number of worksite employees of the other business, regardless of the terminology used by the parties to describe the relationship. This does not include a business entity that recruits and hires its own employees, assigns them on a temporary basis, and customarily attempts to reassign them when finished with an assignment.

The important part of the definition – what a PEO is not.  

Sometimes an employer will mistake a PEO for an ASO or an HRO.    I will not cover the definitions of each type of organization.   The main concept to remember is to READ THE CONTRACT very carefully.   We had assisted at least two companies that thought they were in a PEO when they were actually in an ASO agreement.  An ASO is usually not responsible for obtaining Workers Compensation through the ASO.    ASO’s and HRO’s are not undesirable companies.  Make sure your company ends up with the company you contracted for services. 

Check out Page 6-states that do not require a PEO to register or regulates their operation. 

The material on pages 6 – 11 covers critical terms:

  • Master Coordinated Policies  (MCP) 
  • Master Policy
  • Client Direct Purchase 

Each state has its own set of rules on allowable types of PEO operational structures.    The allowed structure should be reviewed very carefully before signing on with a PEO.  Why? – Under a PEO, would your company have an individualized E-Mod or would your company assume the PEO’s Mod?  The PEO’s Mod is almost always preferable. 

I recommend reading all 77 pages.    No one including myself or NCCI is saying that PEO’s are high-risk or an unwanted risk management technique.  In fact, a properly handled PEO agreement can save a large amount of premiums.  

So, go ahead and download the PEO data reporting workshop manual.   

©J&L Risk Management Inc Copyright Notice

Filed Under: NCCI Conferences, PEO Tagged With: ASO, HRO, MCP, NAIC, terminology

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About Me

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James J Moore
Raleigh, NC, United States

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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Recent Posts

  • Workers Comp COVID-19 Vaccinations – Part of Return To Work
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  • J&L Founder James J Moore to Teach Insurance Academy Course Feb 4th
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