Investing in a Safer Future
The Ohio Bureau of Workers’ Compensation made plenty of headlines with its billion-dollar rebates to employers. But few are aware of how the BWC is also giving back to its employees — by investing heavily in their long-term health and safety.
Part of that effort is the establishment of a research grant program, funding short-term projects that identify practical solutions to workplace hazards.
The BWC created partnerships with educational and research facilities across the state in an effort to find solutions for some of the most intractable worker health and safety problems.
“I wanted to get on the offensive side of safety and not just respond to accidents or injury types,” said former BWC Administrator and CEO Stephen Buehrer, who launched the research grant program.
“We believe these dollars are well invested in fostering research at world class institutions that could shed light on how injuries may be prevented in the future,” said the BWC’s current Administrator and CEO, Sarah Morrison.
“There is no place better than Ohio to conduct innovative research that could have an impact in workplaces across the country.”
The BWC sent out an RFP to research institutions throughout Ohio, seeking projects that could be completed in 12 to 18 months within a budget of $250,000. With input from the National Institutes for Occupational Safety and Health, they ultimately selected nine projects to fund, for a total just topping $2 million.
“These researchers are working directly with employers in Ohio, and we expect that there will be some direct benefit in preventing occupational injuries and illnesses as a result of [these projects],” said Abe Al-Tarawneh, BWC’s superintendent of the Division of Safety and Hygiene.
In addition, he said, each research team will disseminate its findings, results and recommendations, and make them available to employers throughout their respective industries.
Focus on Health Care
A sizable chunk of the $2 million for research was earmarked for projects related to health care fields. Injuries to health care workers, particularly those working in long-term care facilities, are of grave concern in Ohio and nationwide. Ohio has approximately 1,000 nursing homes, serving more than 80,000 residents.
“When we put out the request for proposal, addressing the health care industry was a priority,” said Al-Tarawneh.
Two of the selected proposals target safe patient handling practices. Al-Tarawneh said that in many cases, even in facilities that have sufficient patient handling equipment, workers tend not to use it because they perceive that it will slow them down or be inefficient.
A $250,000 grant to the University of Cincinnati will enable researchers to study the application of a training model that has been used extensively in Europe, particularly in the UK, with strong results. The model ties together cultural and behavioral issues, with a focus on hazard awareness and planning.
“They’re going to take it and essentially redesign it in a way that matches the standards that we have for health care in Ohio, and they’re applying it with 30 different nursing homes in the state,” said Al-Tarawneh.
Researchers will assess the existing training and equipment at those facilities, and customize the new training module for each one. They will then administer the training to employees at every facility, and follow up in six months to assess the effectiveness of the training. Based on those assessments, they’ll provide a new set of recommendations.
The resulting training program will be made available online.
Cleveland State University College of Science and Health Professions will also receive $244,000 to help faculty from four disciplines at CSU develop an innovative approach to prevent back injuries among nurse aides.
The Case Western School of Medicine will receive $250,000.00 to study the development of a Total Worker Health approach to addressing the socioeconomic factors impacting worker health and safety, particularly low-wage and job-insecure employees working in long-term health care facilities.
“Low wage and job-insecure employees tend to have a higher rate of occupational injuries and they tend to [have poor] health care and more prevalent chronic health issues,” said Al-Tarawneh.
Case Western researchers will work with 10 or 12 groups of people, providing training on healthy behaviors. They’ll follow up over the course of a year, and assess progress via an app designed for the purpose.
Bowling Green State University’s Psychology Department was awarded a $250,000 grant for research into preventing injuries, assault and abuse of nurse aides working in long-term residential settings.
The project will target nurse aides in four facilities, implementing mindfulness-based interventions. Researchers will teach employees to use mindfulness techniques to handle the stressors of their jobs.
“There is a direct association between the job demands and the rate of injury,” said Al-Tarawneh. “So if you get workers to better understand how to cope with the stresses of their job demands, you can improve their well-being, which will result in reducing the propensity for them to get injured.”
Part of the project will involve teaching workers to use the same mindfulness techniques to de-escalate situations that lead to assault or abuse by residents.
“When you think about these different projects, each of them handles the [industry] from a different angle,” said Al-Tarawneh.
“So in two or three years, when our consultants are working with a health care facility or a nursing home, they’re going to be able to provide them with better training modules, with better understanding of the issues, with better tools so they can engage their employees and empower them.
“We’re hoping by the time we’re done that it will benefit the industry across the country.”
Benefits for Numerous Industries
Other BWC grants are exploring a variety of challenges for workers and employers.
Using sensors embedded in the insoles of shoes, researchers are recording data on balance and gait, and relating it to specific tasks, to assess at what point being unbalanced results in a fall. In the future.
The Ohio University College of Engineering and Technology received $245,000 to measure the impact of integrating safety and ergonomics into lean and Six Sigma processes already in place at Ohio manufacturers.
“One of the things that’s happened over the years of introducing lean concepts and Six Sigma concepts in manufacturing as well as other industrial sectors is they tend to eliminate waste,” said Al-Tarawneh.
“That can result in improving safety for employees, but it can also result in improving productivity to a level that sometimes employees cannot keep up with. So the idea is to bring in ergonomic concepts and embedding them into Six Sigma and lean manufacturing concepts.”
Researchers are working with 15 manufacturing firms across Ohio, stratified between small and large firms, and a final report will be available across the country.
The Case Western School of Engineering received a $250,000 grant to study the prevention of slips, trips and falls using wearable technology.
Using sensors embedded in the insoles of shoes, researchers are recording data on balance and gait, and relating it to specific tasks, to assess at what point being unbalanced results in a fall. In the future, explained Al-Tarawneh, “the system can communicate via something like an iWatch and warn the person that the way they’re doing things will result in slipping or tripping.”
Ohio State University has been awarded three grants totaling $577,595 to study diverse areas.
OSU’s Department of Integrated Systems Engineering is using a wearable quantifying tool called a lumbar motion monitor to gather real data about the forces exerted on the spine during pushing and pulling tasks.
Researchers will be developing a web-based tool that employers can use to assess the pushing and pulling tasks used at their facilities.
Subjects will simulate tasks common to workers in various industries, said Al-Tarawneh. The lumbar motion monitor and 42 sensor cameras are used to establish every movement in every direction to establish the stress of each movement on the spine. The results are compared to injury threshold data and will be used to create streamlined ergonomic standards for pushing and pulling tasks.
“It’s an amazing project,” said Al-Tarawneh. “It’s going to be an excellent advancement in the science.”
Researchers will be developing a web-based tool that employers can use to assess the pushing and pulling tasks used at their facilities.
In the lab next door, researchers are studying powered torque wrenches, and the impact of the force and vibration of torque tools on the hands and arms of the user.
“Those forces, over time, can be really detrimental to the tissues and the nerves of the worker,” said Al-Tarawneh. “There is no specific standard for these torque tools to account for how the force of the tool transfers to the body of the user.”
The team will develop a dynamic rig for assessing powered torque tools as they are brought to market. Industry partners include Stanley Assembly Technologies, Honda North America, Inc. and General Motors.
A third project at OSU involves hazards in grain bin facilities on Ohio farms, assessing the training and PPE provided to workers, and identifying gaps that can be addressed. Al-Tarawneh said this project is an important way that BWC can reach out and work with smaller farmers to help prevent the kind of injuries that are sometimes overlooked.
“We’re going to fund this kind of thing every year,” former Administrator Buehrer told Risk & Insurance during a September 2015 interview.
“Our hope is that each year we’ll be rolling out a half dozen to a dozen sets of results that we can share with employers. Ohio BWC considers it a key part of its mission to take on some of the problematic workers’ comp challenges and really get ahead of the issues rather than just reacting to the injury type.”
Bundled Care’s Place in Workers’ Comp
Medicare continues wielding its leverage to push the nation’s medical systems away from fee-for-service arrangements toward alternative payment models expected to improve care quality.
But one mainstay alternative medical treatment model — bundled care— is off to a slow start in workers’ compensation as implementation hurdles remain.
Very few bundled care models have emerged for treating injured workers. Yet workers’ comp experts expect that the bundled payment concept will eventually flow into more treatments for workplace injuries.
“I think we will get there,” said Jacob Lazarovic, senior VP and chief medical officer at Broadspire, a third party administrator with a large workers’ comp book of business.
“There will be models that work,” he continued. “There will be entities that manage to put it together. I am pretty sure we are going to see an expansion of programs,” including a potential bundled care program Broadspire is developing for injured worker outpatient surgeries.
Bundled care and bundled payment refers to the coordinated delivery of all medical provider services needed to address a specific illness or injury. A medical group or hospital, for example, would bundle all services including imaging, anesthesia, surgery, follow-up doctor visits and physical therapy for repairing a knee or hip.
They would do so for one single bundled fee that includes financial incentives holding providers accountable for quality outcomes.
In contrast, under fee-for-service arrangements that dominate U.S. health care, claims payers receive bills for each patient interaction with a provider, encouraging treatment quantity over quality.
But Medicare is aggressively pushing nationwide adoption of value-based care delivery models, including bundled care. By the end of 2018, Medicare wants half of its payments flowing to alternative payment models.
The Centers for Medicare and Medicaid Services continues unfurling mandates to make that happen. In July, it announced that hospitals in nearly 100 markets would be accountable for the financial and quality outcomes associated with bypass surgeries and heart attacks.
By bundling care for those treatments Rising provides insurers, TPAs and self-insured employers greater cost predictability, administrative efficiency, and “concierge” level of service” for injured worker.
That follows a 2015 announcement impacting nearly 800 hospitals with a mandate for bundled programs for hip and knee replacements.
Experts frequently cite the government efforts among reasons they expect bundled payments will eventually spread from Medicare arrangements to private contracts such as those arranged to care for group health and workers’ compensation claimants.
Medicare’s efforts, for example, should help accustom medical provider groups to contracting with each other to arrange bundles.
“With Medicare we’ve seen quick diffusion of bundled payments,” said Shawn Matheson, a manager at Leavitt Partners, a health care consultant and intelligence firm. That will help private industry claims payers evaluate CMS challenges and successes as a base for additional program designs, Matheson added.
Developing Bundled Programs
For now, though, several workers’ comp observers said they can only cite two or three existing bundled care programs for treating worker injuries while other efforts are under development.
Treatment at the University of California Los Angeles’ Center for Behavioral & Addiction Medicine, for instance, is available through a bundled care program that R&Q Healthcare Interests arranged for workers’ comp claims payers.
“But it is important to recognize there are some difficult problems to be solved in comp that start with return to work and how you hold people accountable.” — David Deitz, managed care expert, David Deitz and Associates
R&Q’s program for injured worker pain and addiction treatment is the first bundled offering the company expects to develop under an existing contract it has with the entire University of California system, said Bill Lape, CEO at R&Q Healthcare, a unit of Randall & Quilter Investment Holding Ltd.
Broadspire, meanwhile, teamed up with a medical network provider to explore developing a pilot program of ambulatory surgery facilities offering bundled services for injured-workers, Lazarovic said.
Ideally, the arrangement would allow the collection of metrics for measuring outcomes such as patient satisfaction and return to work.
And Rising Medical Solutions now offers workers’ comp surgery care programs in regions of Illinois, Florida, New Jersey and Georgia. Those regions generally experience greater variation than normal in the pricing of routine surgeries for treating problems such as knee injuries and carpal tunnel syndrome, said Robert Evans, VP of repricing solutions at Rising.
By bundling care for those treatments Rising provides insurers, TPAs and self-insured employers greater cost predictability, administrative efficiency, and “concierge” level of service for injured workers, Evans said.
Evans will speak in November at the National Workers’ Compensation and Disability Conference & Expo in New Orleans as part of a panel discussion on strategies for bringing value-based care, like bundled arrangements, to workers’ comp.
Broadspire’s Lazarovic will also speak at NWCDC during a presentation titled “How to Use a Medical Expert So You Don’t Get Burned on Causation.” The conference agenda is available at www.wcconference.com.
Fee-for-service’s entrenchment in workers’ comp medical care, meanwhile, and work comp’s emphasis on issues that don’t exist in group health, like return to work, are slowing adoption of bundled care for injured workers.
Bundling care for ailments commonly diagnosed among injured works, like carpal tunnel syndrome, would be straight forward, said David Deitz, a managed care expert at David Deitz and Associates. But holding medical providers accountable for return to work remains a challenge.
Accountability could be difficult to enforce if, say, medical providers repair a worker’s injury as expected, but for some other reason the employee decides not to return to the job, Deitz elaborated.
“I think there is a really difficult problem here [but] it’s not insolvable,” Dietz said. “But it is important to recognize there are some difficult problems to be solved in comp that start with return to work and how you hold people accountable.”
Other obstacles to implementing bundled programs for injured workers include work comp’s state-by-state regulation and entrenched reliance on medical fee schedules based on fee-for-service arrangements.
Cyber: The Overlooked Environmental Threat
“Cyber breach” conjures fears of lost or ransomed data, denial of service, leaked corporate secrets and phishing scams.
But in a world where so many physical operations are automated and controlled by digital technologies, the consequences of cyber attacks extend far beyond the digital realm to include property damage, bodily injury, and even environmental pollution.
Industrial companies that deal with hazardous materials — like power plants, refineries, factories, water treatment facilities or pipelines — are heavily dependent on automated technology to maximize their efficiency. Other sectors use technology to control HVAC systems, power and utilities, placing their properties at risk as well.
Cyber risks like theft of personally identifiable data have been highly publicized in recent years, but physical risks like pollution sparked by a cyber breach may not be as obvious.
“It’s significant to lose 100,000 customers’ Social Security numbers,” said William Bell, Senior Vice President, Environmental, Liberty International Underwriters, “but can you imagine if a waste treatment facility’s operations get hacked, gates open, and thousands of tons of raw sewage go flowing down a local river?”
In many industrial complexes, a network of sensors gathers and monitors data around machinery efficiency and the flow of the materials being processed. They send that information to computer terminals that interpret the data into commands for the hardware elements like motors, pumps and valves.
This automation technology can control, for example, the flow of pipelines, the level of water or waste held in a reservoir, or the gates that hold in and control the release of vast quantities of sewage and other process materials. Hackers who want to cause catastrophe could hijack that system and unleash damaging pollutants.
And it’s already happened.
In 2000, a hacker caused 800,000 liters of untreated sewage to flood the waterways of Maroochy Shire, Australia. In 2009, an IT contractor, disgruntled because he was not hired full-time, disabled leak detection alarm systems on three off-shore oil rigs near Long Beach, Calif.
Just last year, cyber attackers infiltrated the network of a German steel mill through a phishing scam, eventually hacking into the production control system and manipulating a blast furnace so it could not be shut down. The incident led to significant property damage.
According to a leading industrial security expert and executive director of the International Society of Automation, “Today’s operational technologies—such as sensors, SCADA systems, software and other controls that drive modern industrial processes—are vulnerable to cyber attack. The risk of serious damage or compromise to power and chemical plants, oil and gas facilities, chemical and water installations and other vital critical infrastructure assets is real.”
“The hacks could come from anywhere: a teenager looking for entertainment, a disgruntled worker, or more sophisticated criminals or terrorists,” Bell said. “There are certainly groups out there with political and ideological motivations to wreak that kind of havoc.”
“We are working to bring the cyber component of environmental risk to the forefront. Cyber security is not just an IT issue. Industry executives need to be aware of the real-world risks and danger associated with an industrial cyber attack as well as the critical differences between cyber security and operational technology security.”
— William Bell, Senior Vice President, Environmental, Liberty International Underwriters
The cleanup cost of an environmental disaster can climb into the hundreds of millions, and even if a cyber breach triggered the event, a cyber policy alone will not cover the physical and environmental damage it caused.
The risk is even more pointed now, as resource conservation becomes increasingly important. Weather related catastrophe modeling is changing as both flooding and drought become more severe and frequent in different regions of the U.S. Pollution of major waterways and watersheds could have severe consequences if it affects drinking water sources, agriculture and other industrial applications that depend on this resource.
Managing the Risk
Unfortunately, major industrial corporations sometimes address their environmental exposure with some hubris. They trust in their engineers to remove the risk by designing airtight systems, to make a disaster next to impossible. The prospect of buying environmental insurance, then, would be superfluous, an expression of doubt in their science-backed systems.
Despite the strongest risk management efforts, though, no disaster is 100 percent avoidable.
“We are working to bring the cyber component of environmental risk to the forefront,” Bell said. “Cyber security is not just an IT issue. Industry executives need to be aware of the real-world risks and danger associated with an industrial cyber attack as well as the critical differences between cyber security and operational technology security.”
The focus on network security and data protection has distracted industry leaders from strengthening operational technology security. Energy, manufacturing and other industrial sectors lack best practice standards when it comes to securing their automated processes.
After the Homeland Security Act of 2002, the Department of Homeland Security began comprehensive assessments of critical infrastructure’s cyber vulnerability, working with owners and operators to develop solutions. It also offers informational guides for private companies to do the same. The National Institute of Standards and Technology also continues work on its cyber security framework for critical infrastructure. Although this helps to establish some best practices, it does not completely mitigate the risk.
Many businesses don’t see themselves as a target, but they need to look beyond their own operations and property lines. They could be an attractive target due to their proximity to densely populated areas or resources such as waterways and highways, or nationally or historically significant areas. The goal of a cyber terrorist is not always to harm the target itself, but the collateral damage.
The Role of Insurance
“Environmental liability is still by and large viewed as a discretionary purchase,” Bell said, “but the threat of a cyber attack that can manipulate those systems and ultimately lead to a pollution incident is added incentive to buy environmental coverage.”
Liberty International Underwriters’ environmental coverage could respond to many pollution conditions set off by a cyber breach event.
“Property damage, bodily injury and cleanup of any pollution at or emanating from a covered property would likely be taken care of,” Bell said. “The risk is not so much the cyber exposure but the consequence of the attack. The resulting claims and degradation to the environment could be severe, especially if the insured was a target chosen because of their unique position to have a large effect on the local population and environment.”
LIU also offers dedicated Cyber Liability insurance solutions designed to manage and mitigate the cost of responding to a cyber attack and any resultant loss of data and associated liability. Coverage includes proactive data breach response services designed to help organizations comply with regulatory requirements and prevent data breaches.
LIU’s loss control managers are also on hand to conduct assessments of insureds’ properties and facilities to examine potential environmental impacts. They can educate brokers on the importance of enhancing cyber security to prevent an environmental accident in the first place.
“People are relying more and more on their systems, automaton is increasing, and the risk is growing,” Bell said. “We’re all focused on protecting data, but the consequences of a cyber breach can be much farther reaching than data alone.”
To learn more about Liberty International Underwriters’ environmental coverages and services, visit www.LIU-USA.com.
Liberty International Underwriters is the marketing name for the broker-distributed specialty lines business operations of Liberty Mutual Insurance. Certain coverage may be provided by a surplus lines insurer. Surplus lines insurers do not generally participate in state guaranty funds and insureds are therefore not protected by such funds. This literature is a summary only and does not include all terms, conditions, or exclusions of the coverage described. Please refer to the actual policy issued for complete details of coverage and exclusions.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Liberty International Underwriters. The editorial staff of Risk & Insurance had no role in its preparation.