No Humbug on Safety for This Workplace
If you were to study some of the safest and most successful organizations, you’d see that many of them share a common philosophy: When the CEO takes ownership of the safety program, it sends a message to the entire company that safety is top priority. That universal truth is evident at organizations around the world — including the North Pole.
North Pole CEO Santa Claus is a stickler for safety, and he knows how to drive results. For the 2014 holiday season, there were only 15 OSHA recordable elf injuries, down 15 percent from last year. There were only two serious lost-time injuries in 2014, both Fleet Management employees, related to a trampling incident involving Donner and Blitzen. (Both reindeer have since received anger management counseling through the organization’s employee assistance program.)
Those injury statistics are quite remarkable, when you consider that the North Pole workforce is more than 10,000 strong, with 80 percent of elves involved in high-hazard work in toy manufacturing, product testing and quality assurance, packaging and warehouse operations.
Always New Challenges
Claus personally chairs the organization’s safety committee, which includes representatives from departments such as Toy Operations, Reindeer Fleet Management, Wish List Fulfillment, Sled Logistics and Sweets Services. Committee members take ownership of safety for their departments, leading weekly training sessions for their teams on job-specific issues such as avoiding slips and falls from spilled hot cocoa, and wearing safety goggles while product testing Nerf guns and using cut-resistant gloves to reduce the paper-cut risk for staff members tasked with opening and filing letters to Santa.
Santa faces unique risk management challenges every year. In the 1960s, a change to the Silly Putty formula caused widespread cases of chemical sensitivity among handlers. In 1996, a dozen product testers working on Tickle Me Elmo had to be treated for Reynaud’s Syndrome. “We should’ve seen that one coming,” said Claus ruefully, as he explained how stricter vibration protocols were put in place after that season.
The increasing trend toward electronic toys has brought its own set of challenges to Claus’ team. Many of the North Pole’s aging elves have been assigned to circuit board assembly because it is less physically demanding work than Big Wheel assembly or operating the Lego molding machines. However, the fine-detail nature of the work has led to complaints of eyestrain, leading Claus to invest heavily in magnifiers to accommodate his elder elves.
Claus is extremely proud of his return to work/stay at work program. Even elves with mobility issues can pitch in, delivering tools and parts anywhere they’re needed on the factory floor, via R/C Air Hog transport helicopters. Others conduct regular safety inspections enterprise-wide, using small camera equipped hobby drones. When the two workers involved in the reindeer trampling incident were suffering from PTSD, they were assigned to light-duty, low-stress tasks to aid in their recovery, including candy cane testing and topping coworkers’ cocoa with whipped cream. “They were kept at full salary,” explained Claus, “and we were able to put them in jobs that made them smile and made everyone around them smile. Surrounding them in happiness helped them heal from the trauma of that frightening incident.”
The most recent additions to the North Pole safety and workers’ comp program were championed by Claus’ wife, Jessica, who has taken on the role of Executive Vice President for Wellness and Ergonomics for the entire organization. Mrs. Claus has organized a required daily stretching program for the beginning of each work day. Everyone participates, even the Jolly old Elf himself. She also leads wildly popular Twister Yoga classes to keep workers limber and alert, and to help manage seasonal stress. Claus is an avid health advocate, sending out newsletters full of healthy holiday tips, including recipes for stevia-sweetened sugar cookies, reminders to replace a few servings of fruitcake with fresh fruit, and warnings about the dangers of excessive eggnog abuse.
Mrs. Claus, who is even more tireless than her globe-trotting husband, also oversees the in-house claims management team, and the on-site nursing staff. Simple injuries such as candy cane splinters are treated right away and elves are back on the job in mere minutes. Nurse case managers fulfil other roles as well, such as suggesting temporary reassignment for elves suffering from tinnitus from high-decibel jingle bells.
In 2015, Claus is planning on adding new elements to the program. A voluntary biometric testing program is in the works. A spare storage room is being refashioned into a fitness “PlayZone” equipped with two dozen large screen TVs connected to Xbox One and PlayStation Move, and fully stocked with high-action movement games and fitness programs. Mrs. Claus is also working with the in-house design and fabrication teams to develop a new line of elf shoes with fitness-tracker bells to help motivate workers to move more. “Elves thrive on friendly competition,” said the EVP. “I hope to tap into that by developing an app with a leaderboard showing everyone’s steps. Toy-making is all about teamwork and cooperation. This will give each elf a chance to show off and be a star.”
Santa Claus told Risk & Insurance® that while he couldn’t share the actual numbers, the ROI on the North Pole’s safety and workers’ comp investments is off the charts. But Claus said that he and Mrs. Claus are more focused on the real sprit of safety. “Safe and happy elves make safer games and toys,” said Claus. “That means safer kids all over the world. There’s a lot more riding on our safety program than cost control,” he added with a wink of his eye and a twist of his head.
Wishing you a safe and Happy Holiday season from WorkersComp Forum!
Prepare for Access Issues Now
How will the Affordable Care Act impact workers’ comp? Opinions vary, and so does the research, said Bill Wilt, president of Assured Research, at a session entitled “Healthcare Reform: Strategies You Can Apply Now,” presented at the 2014 National Workers’ Compensation and Disability Management Conference & Expo in Las Vegas.
Wilt presented the session jointly with Denise Algire, director, managed care and disability corporate risk for Safeway Inc.
According to the 2014 Workers Compensation Benchmarking Study published by Rising Medical Solutions, 73 percent of respondents said that the ACA had not yet impacted claims.
However, most believe that an impact will eventually be felt. There is significant disagreement over whether that impact will be positive or negative.
A recent RAND Corp. report suggested that higher rates of insurance take-up would result in less fraud by injured employees without health insurance and less embellishment of real claims. In addition, the report suggested that the ACA focus on creating a generally healthier population overall would positively impact workers’ comp costs across the country.
But, Wilt said, he wasn’t sold on RAND’s results. An Assured Research study of the effect of insurance enrollment on workers’ comp loss ratios showed results all over the board, with evidence of the positive correlation RAND suggested in some states, but with flat results in other states.
Curiously, there was evidence of the opposite effect in many states, with higher insurance take-up correlating to higher loss ratios.
The bottom line, though, said Algire, is that whether you think the ACA is a positive or negative thing, it has changed health care, which unarguably will affect workers’ comp. Employers need to be prepared for the fallout.
Where that will be most keenly felt, she said, will be provider shortages. “Prepare for access issues,” said Algire.
Employers’ should be prepared to cultivate partnerships with outcome-focused providers, she said. And to put an emphasis on front-loading care. That means putting the lion’s share of energy and resources into resolving claims at the primary care level, working to resolve them before they require heavy specialist care, which is where provider shortages will most dramatically impact outcomes.
Facing the Road Ahead
There are both new and evolving challenges facing workers’ comp practitioners in the coming years. But there is also an increasing level of sophistication among those who are working to meet those challenges.
Top carriers came together for a meeting of the minds for a session entitled “Workers’ Comp Insurance Exposed: Views from the Industry’s Leading Carriers.”
The session, presented at the 2014 National Workers’ Compensation and Disability Management Conference & Expo in Las Vegas, was led by Eric Silverstein, senior vice president and risk management leader for Lockton Cos., included participation from Russell Johnston, casualty president for the Americas Region with AIG Inc.; Debbie Michel, executive vice president, commercial markets with Liberty Mutual Insurance and president of Helmsman Management Services; and Sean D. Martin, vice president with The Travelers Cos.
One development carriers are encouraged by is an increase in employers exploring benefits integration, bringing together disability, health care and workers’ comp.
“The challenge is that many customers look at it in a bifurcated way,” said Johnston. A more unified approach can help employers address the issues that affect outcomes across the spectrum, which are of increasing concern for employers as ongoing economic woes continue to force older employees to work as long as they’re physically able.
A more holistic approach can help improve outcomes from both the occupational and the non-occupational sides by working to improve the overall health of the employee population.
“If you have a healthy employee, regardless of age,” said Johnston, “you’re going to have a better outcome.”
The potential to positively affect outcomes and cut costs across the whole of an employee population can also provide substance for workers’ comp professionals trying to make the business case for wellness investments such as on-site gyms or an on-site nutritionist, Johnston said.
Going forward, there are plenty of positives to build from, panelists said. Currently, 22 states have filed for rate decreases.
“If there’s any point in time where I think the industry has been exceptionally good at risk selection and pricing, it’s today,” said Johnston. And employers that have been diligent about managing their risk profiles can expect significant improvement.
Still, there’s a great deal of room for improvement, as evidenced by California’s ongoing challenges. Despite the most recent round of reforms, California is still plagued by dramatic increases in injury frequency and severity, and by crushing backlogs in the independent medical review process.
The uncertain fate of TRIA’s renewal is still on the radar for employers as well as carriers, but panelists said they are cautiously optimistic.
They are somewhat more concerned about other looming threats such as physician capacity and hospital consolidation, the Affordable Care Act, and cost shifting into the workers’ comp space, said Martin.
Carriers are also closely watching the development of interest in workers’ comp alternatives.
The formation of ARAWC – the Association for Responsible Alternatives to Workers’ Compensation – by many large companies is a clear sign that there is interest in an expansion of alternatives to state workers’ compensation systems, such as the nonsubscriber system in Texas and the recently enacted Oklahoma option, to other states.
In the end, said Michel, it will be up to states to find the “balance between doing the right thing for the economy and doing the right thing for the injured worker.”