Brokers List Legislative Priorities
You don’t have to spend your days watching C-SPAN to know that insurance issues are taking a prominent role on Capitol Hill lately.
“I don’t think I’ve ever seen the parochial interest [the insurance industry] holds having risen to the national priority that is the current environment,” said Joel Wood, senior vice president of government affairs for The Council of Insurance Agents & Brokers. “Agents have a lot of skin in the game.”
With the passage of the flood insurance bill, many agents are breathing a sigh of relief that the specter of massive rate increases won’t become a reality. However, several other pending issues could have weighty consequences for the insurance industry at large, and agents in particular.
The Affordable Care Act
“The independent agents are small business owners that are being impacted greatly by the implementation of health care reform,” said Mike Becker, executive vice president and CEO of the National Association of Professional Insurance Agents (PIA).
“We’ve been incredibly loud advocates for the agent, ensuring that they’re able to participate, should they desire to do so, and they’re fairly and justly compensated for doing so, whether they’re participating in the traditional market or through an exchange,” he said.
PIA is currently asking members to find cosponsors for H.R. 2328, the Access to Professional Health Insurance Advisors Act, introduced by U.S. Reps. Mike Rogers (R-MI) and John Barrow (D-GA), to ensure that agent compensation is not disadvantaged by implementation of the ACA.
Wood pointed out that the current political climate during mid-year elections may make it difficult to achieve much change on the legislative end, so the CIAB is focusing more on regulatory issues related to health care.
“The pieces we’ve been engaged on are with respect to issues that impact ERISA [Employee Retirement Income Security Act] with the Department of Labor, to testifying on the wellness provisions, to working with the various agencies on trying to develop the right kind of nondiscrimination rule that has yet to come forward and the auto-enrollment rules that have yet to come forward.
“There are a million moving parts on the Affordable Care Act, and we try to engage on all of that impact our clients,” Wood said.
Another issue that is top of mind for agents is renewal of the Terrorism Risk Insurance Act (TRIA), which is set to expire at the end of the year.
“Almost every major commercial policy today has a rider on it that says that post-Dec. 31st 2014, terrorism coverage will not be in place depending upon the outcome of this debate,” Wood stated.
“It’s a product that’s not easily accessible in the private market without the terrorism risk and insurance program,” said Becker. “We support those programs and we’re going to be advocating for its passage.”
The CIAB is also focusing on the Foreign Account Tax Compliance Act, which is designed to prevent tax evasion in transactions with offshore companies.
“We have unsuccessfully argued to the IRS that we should be exempted from implementation and reporting requirements on commercial insurance transactions,” Wood said. “Now, we’re moving to the implementation side and it’s going to be a burden both on the brokers and on their clients.
“Theoretically this sounds pretty simple, but there are unanswered questions. What is Lloyd’s of London, for example? Is that one insurance company or is it 200 companies, or is it 20,000 syndicates?”
To that end, CIAB is seeking clarification within the rules so that it can become a clearinghouse to help international insurers to comply with FATCA.
One of PIA’s biggest concerns involves federal regulation of insurance.
“We don’t think that there’s any further reason for federal regulation in this sphere,” said Jon Gentile, PIA national director of federal affairs.
“The insurance industry historically has been regulated at the state level. One of the things that came out of the financial crisis was that state regulation did, in fact, work and it worked well. We just want to make sure that our members are up on the Hill letting members of Congress know that state-based regulation does work well and has been for some time.”
However, the CIAB views this issue through a different lens.
“We think that it’s almost an embarrassment that our industry’s regulation is so fragmented when it comes to international trade,” said Wood. “We’re surprised at the degree to which some state insurance regulators have taken umbrage at the obvious role, as asserted in Dodd Frank for the Federal Insurance Office, to participate in reflecting U.S. goals in global talks.
“It’s a national business,” he said. “There has been a huge amount of consolidation. All the trend lines are going further in that direction.”
Wood also said that CIAB is advocating for passage of the National Association of Registered Agents and Brokers Reform Act that is designed to streamline interstate insurance licensing.
“It was big disappointment on not getting it [added as a rider to] the flood legislation. Shame on us, if we can’t get that to the finish line this year,” he said.
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Achieving More Fluid Case Management
Risk management practitioners point to a number of factors that influence the outcome of workers’ compensation claims. But readily identifiable factors shouldn’t necessarily be managed in a box.
To identify and discuss the changing issues influencing workers’ compensation claim outcomes, Risk & Insurance®, in partnership with Duluth, Ga.-based Healthcare Solutions, convened an April roundtable discussion in Philadelphia.
The discussion, moderated by Dan Reynolds, editor-in-chief of Risk & Insurance®, featured participation from four tenured claims management professionals.
This roundtable was ruled by a pragmatic tone, characterized by declarations on solutions that are finding traction on many current workers’ compensation challenges.
The advantages of face-to-face case management visits with injured workers got some of the strongest support at the roundtable.
“What you can assess from somebody’s home environment, their motivation, their attitude, their desire to get well or not get well is easy to do when you are looking at somebody and sitting in their home,” participant Barb Ritz said, a workers’ compensation manager in the office of risk services at the Temple University Health System in Philadelphia.
Telephonic case management gradually replaced face-to-face visits in many organizations, but participants said the pendulum has swung back and face-to-face visits are again more widely valued.
In person visits are beneficial not only in assessing the claimant’s condition and attitude, but also in providing an objective ear to annotate the dialogue between doctors and patients.
“Oftentimes, injured workers who go to physician appointments only retain about 20 percent of what the doctor is telling them,” said Jean Chambers, a Lakeland, Fla.-based vice president of clinical services for Bunch CareSolutions. “When you have a nurse accompanying the claimant, the nurse can help educate the injured worker following the appointment and also provide an objective update to the employer on the injured worker’s condition related to the claim.”
“The relationship that the nurse develops with the claimant is very important,” added Christine Curtis, a manager of medical services in the workers’ compensation division of New Cumberland, Pa.-based School Claims Services.
“It’s also great for fraud detection. During a visit the nurse can see symptoms that don’t necessarily match actions, and oftentimes claimants will tell nurses things they shouldn’t if they want their claim to be accepted,” Curtis said.
For these reasons and others, Curtis said that she uses onsite nursing.
Roundtable participant Susan LaBar, a Yardley, Pa.-based risk manager for transportation company Coach USA, said when she first started her job there, she insisted that nurses be placed on all lost-time cases. But that didn’t happen until she convinced management that it would work.
“We did it and the indemnity dollars went down and it more than paid for the nurses,” she said. “That became our model. You have to prove that it works and that takes time, but it does come out at the end of the day,” she said.
The ultimate outcome
Reducing costs is reason enough for implementing nurse case management, but many say safe return-to-work is the ultimate measure of a good outcome. An aging, heavier worker population plagued by diabetes, hypertension, and orthopedic problems and, in many cases, painkiller abuse is changing the very definition of safe return-to-work.
Roundtable members were unanimous in their belief that offering even the most undemanding forms of modified duty is preferable to having workers at home for extended periods of time.
“Return-to-work is the only way to control the workers’ comp cost. It’s the only way,” said Coach USA’s Susan LaBar.
Unhealthy households, family cultures in which workers’ compensation fraud can be a way of life and physical and mental atrophy are just some of the pitfalls that modified duty and return-to-work in general can help stave off.
“I take employees back in any capacity. So long as they can stand or sit or do something,” Ritz said. “The longer you’re sitting at home, the longer you’re disconnected. The next thing you know you’re isolated and angry with your employer.”
“Return-to-work is the only way to control the workers’ comp cost. It’s the only way,” said Coach USA’s Susan LaBar.
Whose story is it?
Managing return-to-work and nurse supervision of workers’ compensation cases also play important roles in controlling communication around the case. Return-to-work and modified duty can more quickly break that negative communication chain, roundtable participants said.
There was some disagreement among participants in the area of fraud. Some felt that workers’ compensation fraud is not as prevalent as commonly believed.
On the other hand, Coach USA’s Susan LaBar said that many cases start out with a legitimate injury but become fraudulent through extension.
“I’m talking about a process where claimants drag out the claim, treatment continues and they never come back to work,” she said.
Social media, as in all aspects of insurance fraud, is also playing an important role. Roundtable participants said Facebook is the first place they visit when they get a claim. Unbridled posts of personal information have become a rich library for case managers looking for indications of fraud.
“What you can assess from somebody’s home environment, their motivation, their attitude, their desire to get well or not get well is easy to do when you are looking at somebody and sitting in their home,” said participant Barb Ritz.
As daunting as co-morbidities have become, roundtable participants said that data has become a useful tool. Information about tobacco use, weight, diabetes and other complicating factors is now being used by physicians and managed care vendors to educate patients and better manage treatment.
“Education is important after an injury occurs,” said Rich Leonardo, chief sales officer for Healthcare Solutions, who also sat in on the roundtable. “The nurse is not always delivering news the patient wants to hear, so providing education on how the process is going to work is helpful.”
“We’re trying to get people to ‘Know your number’, such as to know what your blood pressure and glucose levels are,” said SCS’s Christine Curtis. “If you have somebody who’s diabetic, hypertensive and overweight, that nurse can talk directly to the injured worker and say, ‘Look, I know this is a sensitive issue, but we want you to get better and we’ll work with you because improving your overall health is important to helping you recover.”
The costs of co-morbidities are pushing case managers to be more frank in patient dialogue. Information about smoking cessation programs and weight loss approaches is now more freely offered.
Managing constant change
Anyone responsible for workers’ compensation knows that medical costs have been rising for years. But medical cost is not the only factor in the case management equation that is in motion.
The pendulum swing between technology and the human touch in treating injured workers is ever in flux. Even within a single program, the decision on when it is best to apply nurse case management varies.
“It used to be that every claim went to a nurse and now the industry is more selective,” said Bunch CareSolutions’ Jean Chambers. “However, you have to be careful because sometimes it’s the ones that seem to be a simple injury that can end up being a million dollar claim.”
“Predictive analytics can be used to help organizations flag claims for case management, but the human element will never be replaced,” Leonardo concluded.