Options in Oklahoma
The Oklahoma Option is up and running, with four qualified employers and three approved carriers as of July 1.
Scott Taylor, president of qualified employer Taylor & Sons Pipe & Steel, is a believer in the alternative structure. He expects opting out of the traditional workers’ comp system to not only save costs, but deliver better care for injured workers.
The Option “allows you to have a discourse with the employee instead of being taken out of that conversation,” Taylor said. “Under the workers’ comp system, once there’s an injury that’s documented and enters the system, as an employer, your hands are tied completely. You never have an idea what’s taking place. You’re just given decisions and expected to accept those decisions.”
By offering benefits outside of that system, he said, employers can sit down with their workers and figure out which doctors and facilities will best suit them. Greater control over their care, as well as requirements to immediately report injuries, will theoretically instill greater accountability in injured workers and speed return to work.
“The Option allows you to have a discourse with the employee instead of being taken out of that conversation.” — Scott Taylor, president, Taylor & Sons Pipe & Steel
Which benefits employers’ budgets as much as employees’ well-being and productivity.
“We’re probably looking at 20 to 25 percent cost savings,” said Taylor, who employs around 40 workers. “The type of doctors that were available in the system have abused that system for quite some time. Now our employees can go to different facilities that may be half the cost.”
The three other qualified employers are Brookhaven Hospital, Inc. and Alpha Home Healthcare Inc., both offering healthcare services, and Regis Corporation, a hair care franchise.
For now, though, the interest from many other employers is somewhat tentative. Because Oklahoma’s workers’ comp system – previously one of the country’s most expensive – was overhauled at the same time as the Option’s introduction, many employers will wait to see how the two new frameworks compare.
“Accomplishing workers’ compensation reform was a significant challenge for the legislature,” said James Mills, director of workers compensation for Oklahoma. His department is “busy educating the insurance industry, employers and all other interested parties in how to take part in the Option.”
“A lot of employers will wait a year or two to see what their numbers look like under the new workers’ comp system before deciding if they want to opt out,” said Mark Walls, VP of communications and strategic analysis for Safety National, whose Option policy was the first to win state approval . “They want to see what the new normal will be. It’s going to take a couple of years before you see opt-out gaining full traction in Oklahoma.”
Darlene Freeman, ECA division president at Great American Insurance Group, said she expects the number of submissions for Option policies to grow “substantially” as employers realize its benefits. To date, Great American Security Insurance Co. has received more than 70 submissions as well as daily inquiries from all company sizes.
“It’s going to take a couple of years before you see opt-out gaining full traction in Oklahoma.” — Mark Wall, vice president, communications and strategic analysis, Safety National
Now the second state to allow opting out of the workers’ compensation system, Oklahoma still requires employers using the alternative system to meet the minimum benefit standards set by traditional workers’ comp plans.
“That’s very different from Texas,” Walls said. “Under the Texas system, employers simply need to notify the state and their employees that they are opting out and they don’t have to provide any workers’ comp benefits,” though many do choose to provide coverage of some kind.
Safety National and the two other approved carriers, including Great American and OneBeacon Insurance Co., already offer alternative opt-out plans in Texas.
“There are several employers who opted out of workers’ comp in Texas that also do business in Oklahoma, so the thought is they’ll eventually consider opting out in Oklahoma, too,” Walls said.
Freeman echoed the prediction. “Many large national employers who non-subscribe in Texas will be among the first to elect the Option for their Oklahoma operations,” she said.
The increased employee accountability and better medical outcomes that Option advocates are counting on will also mean quicker claims, a boon to both employers and carriers.
“Our experience with Texas non-subscription has proven that when employers take some of the risk with a self-insured retention or deductible, the result is a safer workplace and overall reduction in losses,” Freeman said. “The resulting reduction in claims costs will allow employers to use their savings to grow their businesses, hire more employees and offer additional benefits.”
Claim disputes will still be adjudicated in the workers’ compensation court system rather than civil court, another key difference from Texas. This preserves exclusive remedy for employers and results in a “much more structured” opt-out system than the one established in Texas, according to Walls. Freeman also claims that immediate reporting requirements and better medical care will ultimately result in fewer fraudulent claims for those courts to handle.
The Five-Tool Player
There has been a huge amount of discussion in the media about the “new economy” and the future of employment in America. For years, employers have been replacing humans with robotics, computers and software. In recent years, this trend has been increasing exponentially and can now be considered a “megatrend.”
Where are we going? Hint: Not where we used to be.
The middle class is not really disappearing, it’s just being redefined. The bar is being raised and membership in the middle class in the “new economy” requires a whole new skill set.
The Five-Tool Player
If you’re a baseball fan, you have undoubtedly heard the term “five-tool player.” This refers to a professional baseball player who can run, throw, catch, hit for power, and hit for average. Five-tool players are rare in baseball and command the biggest paydays.
In a business environment, a five-tool player is equally rare, but I’m not talking about baseball skills. I believe that the five essential tools needed for mid-level executives are as follows:
• Technical expertise
• Analytical skills
• Management skills
• Communication skills
• Closing skills
Closing skills doesn’t just mean “closing the sale.” I mean dealing effectively with everyone you have to deal with in today’s environment including superiors, subordinates, clients, vendors, even family. Having great closing skills comes from learning how to use the other four tools in a way that makes an executive (and, therefore, the enterprise) achieve its most effective and efficient level of performance.
I’ve noted a growing intolerance for executives with only one or two of these skills, no matter how well developed. Highly skilled underwriters who were promoted into management positions where they achieved only mediocre results is not an uncommon story. One who wishes to not only survive the coming purges and dislocations that new economy will bring but to actually thrive, would be well advised to devote attention to gaining competence in each of these five tools.
Why This Is Really Good News
One does not need to be born with these skills. They can all be learned, and learning should never stop.
The same technology that has reshaped the future of middle-class employment has also given us the tools to access and develop these skills. Literally everything we need is available in some format online. Even our university system has not caught up with this “megatrend” and newly minted B-school graduates are not equipped as they ought to be.
While it might be a little intimidating to think that you would need all five of these skills in order to hold onto your position, let alone advance, we also have never had such wonderful opportunities to develop new and existing skills.
Read all of Jeff Hallman’s Risk Insider contributions.
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.