Reopened Closed Claims Status – The Silent Wrecker – Trust Me
The Reopened Closed Claims Status can quietly ruin what was a good workers comp program. If you have a Workers Comp regular policy, a large deductible, or are self-insured to cover your workers comp claims, the same quiet but deadly effect can occur without notice.
Let us look at how this can occur in any policy or self-insured program. To see the other articles on the subject, try these two articles:
The Reserve of Reopens Can Be Costly
The Reopened Closed status can increase your risk factor (Experience Mod, Loss Development Factor, etc.) without any clues left behind.
Status – Example – Ouch!
A compensable claim that involved a fractured wrist has resolved. The injured employee has returned to gainful employment. All benefits (you thought) had been paid by the adjuster. A successful claims story has occurred – almost.
Six months after the claim was closed, a laggard hospital bill arrives at the carrier’s claims office. The hospital bill for the emergency surgery the night of the fracture becomes payable for an extra $32,500 on a closed claim.
The claims adjuster quickly reopens the file, has the bill fee scheduled, and then pays the compensable bill quickly and closes the claim. A dutiful insured reviews their claim loss run every quarter. The insured or self-insured may not notice the claim was reopened then closed again, as the Open status never shows up at any time.
Reopened Closed Claims Status Silent Business Killer
And do remember, this comes from a live example I have right in front of me. The Experience Mod was at a .98. The employer knows that if it keeps a Mod of 1.0 or lower, they can bid on commercial projects.
The $32,500 hospital bill was handled properly by all, except the provider submitting it late. Now the employer’s Experience Mod is 1.1. Poof! The rating bureau – usually NCCI – issues a New Mod of 1.1. Now, the employer’s Commercial Division is in a mess.
Solution
See my next article on claims reviews, or have your carrier or TPA flag every reopened claim with a notification emailed to you or the appropriate staff.
A claims review could have missed the bill, but a claims loss run analysis would have flagged the Reopened Closed Claims Status.
