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Column: Workers' Comp

Migration Afoot

By: | October 15, 2014 • 3 min read
Roberto Ceniceros is senior editor at Risk & Insurance® and co-chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at rceniceros@lrp.com. Read more of his columns and features.

An improving job market brings opportunities for employees in the workers’ compensation industry along with challenges for their employers and their employers’ customers. One large third-party administrator is experiencing an “uptick” in employee turnover as the economy gradually improves, the organization’s leader recently discussed at a conference. Other TPA executives tell me their employee retention levels remain flat, but one can reasonably foresee a repeat of the first TPA’s experience as more job opportunities arise.

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An improving economy is good for everyone and a worker’s ability to advance into a better job is a positive sign that the economy is functioning as it should, by efficiently allocating resources.

When the economy tanked, for example, a risk manager I have known for years reluctantly returned to a TPA adjuster job following a layoff. Her skills were under-utilized and she wasn’t happy about returning to a role she had held before advancing in her career.

As the economy improved, she landed a risk management position where she is now happier, fully applying her broader knowledge. Her new employer also benefits from her skill set that was under-utilized during the recession.

The catch is that even moderate employee turnover among TPAs is difficult for customers, industry leaders tell me, presenting challenges for customer service continuity.

Clients suffer when a new adjuster assumes a file they are unfamiliar with. Customers like the service consistency delivered by adjusters and other TPA employees familiar with their business practices and claims handling preferences. They want to keep adjusters they have developed solid working relations with.

Losing employees also concerns TPAs because they can see their recruiting and training investments walk out the door.

Consequently, TPA executives are talking more about improving career advancement opportunities for their workers and how they might reshape careers in their industry so they can retain employees. That’s going to mean getting inside people’s heads and understanding their motivations.

There are many reasons people switch jobs, including commute times, salary increases, workplace personnel issues and career advancement.

A founding member of the Disability Management Employer Coalition recently suggested I write a story about the job churn he now sees among the disability insurers, consultants, and employers he has known for years. He thinks the movement is caused by the corporate demands that emerged during the recession, as companies moved to do more with less.

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He thinks workers are moving in hopes of a lighter workload. I can’t verify whether his theory about the cause of job changes is correct.

But given his position in the disability management community, I suspect his observation that more professionals are moving on as the business outlook improves is on target.

The labor market has not fully recovered from the Great Recession’s impact. But industry leaders would be wise to look ahead and rethink employee retention strategies.

This is a cyclical challenge TPAs have faced before. Pre-recession, when the economy was booming, employee churn was significant, I’m told. But TPAs won’t be the only ones wrestling with these issues as the economy continues improving.

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Nurse Case Management

On the Case

Payers are looking for spirited nurse case managers who will be patient motivators and advocates, not slaves to process.
By: | October 15, 2014 • 7 min read
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Chances are greater today than ever that a workers’ compensation claimant will speak with a registered nurse, either telephonically or in person.

There is also greater likelihood that an injured worker with an ongoing claim will interact with a nurse case manager earlier in the life of that claim than occurred in the past. Those with new injuries, meanwhile, are more likely to speak with a “triage” nurse to help determine whether they need further medical assistance.

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Increasingly, nurses are being used in a variety of workers’ comp roles, from providing counseling for injured workers, to becoming more aggressive questioners and overseers of medical treatment.

Hence, the constant appearance of want ads placed by workers’ comp companies seeking registered nurses, usually with case management skills, capable of helping manage disabilities and returning injured workers to the job.

Expect to see the number of those want ads grow as workers’ comp payers look to stem increasing claims complexity and medical expenses.

Over the next several years, employment of U.S. nurse case managers is expected to grow 3.3 percent annually. At the same time, the medical case management industry’s revenue is expected to grow by 3.6 percent annually, to an estimated $6.7 billion in 2018, according to a September 2013 report by IBIS World, an industry intelligence and research firm.

Those statistics reflect an expected growth in demand for all nurse case managers, including those working in group health. But much of the growth will come from workers’ comp, as the number of workers in the U.S. increases, the report stated.

Historically, hiring trends for nurses in group health and workers’ comp are cyclical.

Efforts to hire workers’ comp nurse case managers plateaued about five to seven years ago following a “huge increase,” said Linda Walker, a board member of the American Association of Occupational Health Nurses.

The growth spurt came when workers’ comp insurers and third-party administrators found they needed more registered nurses to help comply with increasingly complex medical laws and to ensure medical providers followed treatment guidelines, she said.

The hiring run ended due to the Great Recession’s impact on employment, according to IBIS World.

Part of the reason case nurses are so much more in demand today is that claims are much more complex today than in years past, said Liz Thompson, CEO at Encore Unlimited LLC, a case management company in Stevens Point, Wisc.

Comorbidities, an aging workforce, and narcotic prescriptions are driving claims complexities. Nurses are also spending more time addressing behavioral and psychosocial issues beyond the original workplace injury, Thompson said.

“Nurse case managers are really needed to help the insurance community navigate through these complex issues,” Thompson said.

Burgeoning Job Rolls

The proof of that need is that workers’ comp insurers and third-party administrators interviewed for this story said they employ many more nurses today than they did a decade ago.

Sedgwick Claims Management Services Inc., for example, employs more than 400 nurses, double the amount of five years ago, said Teresa Bartlett, senior VP and medical director at the company.

Travelers employs more than 500 registered nurses servicing workers’ comp claims nationwide. Their use was made necessary as the ratio of medical expense to indemnity costs for an average claim increased, said Jim Wucherpfenning, VP of workers’ compensation for Travelers.

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Assigning nurses with the knowledge and communication skills to interact with injured workers and doctors alike speeds the recovery process and gets workers back on the job sooner, he said.

“We believe you get the best medical case management when those pieces of a claim are handled by a medical professional,” Wucherpfenning said.

Other claims payers have also increased in-house nursing staff to manage medical care costs.

“The operational models of carriers or payers increasingly have some commitment to in-house nursing to supplement adjusting staff,” said Ronald J. Skrocki, VP, product management and development at GENEX Services Inc. “Maybe 15 years ago there was some of that.”

Skrocki said it is hard to find a major payer today that isn’t using more nurses either in-house or in an outsourced function. No matter how the industry accesses the talent, it needs more of it, he said.

Melinda Hayes, president and CEO of managed-care company MHayes, said that while some large workers’ comp insurers employ hundreds of nurses, they also contract with her company for nurse field case managers and to bolster their telephonic nursing staff.

For older, complex claims, she has seen her nurse field case managers called in earlier today, with the average time from injury to referral dropping from 2.53 years in 2011 to 1.84 years in 2014, Hayes said.

Predictive analytics also plays a role, as it helps adjusters determine which cases will benefit from nurse oversight of medical care. The technology also helps ensure nurses are not unnecessarily assigned to cases that won’t benefit from their involvement, preventing wasteful expenses, experts said.

Slaves to Process

Insurers and other companies providing case managers and other nursing services also have best practices, treatment guidelines, protocols and client handling instructions that their nurses must follow. The measures are intended to help deliver proper care to speed recovery.

But some workers’ comp observers express concern that today’s case managers spend their workday adhering to those processes, rather than critically evaluating claims and applying their medical expertise to improve outcomes.

“I don’t need to pay for you to scribe. I need a critical thinker and a decision-maker and to challenge what is happening in the exam room.” — Judie Tsanopoulos, director of workers’ comp and loss control, St. Joseph Health System

Field case management nurses are now far less likely to engage in critical practices such as questioning a doctor’s treatment decisions when necessary, said Sherri Hickey, director of medical management for workers’ compensation insurer Safety National.

Instead they focus on following protocols and processes, such as making sure patients find their way to a contracted medical provider network. She doesn’t see as many nurses with the “more aggressive, challenging attitude” she believes is necessary.

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“I find some of the nurses now are a lot more process-oriented,” she said.

“They get a little busy with all that work and they are not really focusing on what is the best outcome for the patient. It is more processing than it is looking at the best outcome and how to facilitate that best outcome.”

Hickey is a registered nurse supervising two other Safety National nurses. Hickey and the Safety National in-house nurses in turn police the field case managers assigned to claims by TPAs to make sure the field case managers are doing their jobs properly.

“We are calling those case managers and having discussions on the phone and saying, ‘Have you asked the [medical provider]this question, have you pursued this theory, have you asked them why they are doing this versus that,’ ” she said.

Sherri Hickey, director of medical management, Safety National

Sherri Hickey, director of medical management, Safety National

“We force them into that a little more.”

Judie Tsanopoulos, director of workers’ comp and loss control at St. Joseph Health System in Orange, Calif., agreed that some field case managers have become increasingly process-oriented to the detriment of good patient care.

“Absolutely,” she said. “We have had difficulty finding good nurse case managers.”

She discontinued relations with some field case management companies because their nurses merely accompanied claimants to medical appointments and took notes, but did not ask enough probing questions.

“I would get their reports and all they did was scribe,” Tsanopoulos said.

“I don’t need to pay for you to scribe. I need a critical thinker and a decision-maker and to challenge what is happening in the exam room,” she said.

“That is what I want to pay for and I want them to take their technical skills and clinical skills and utilize them.”

Done right though, nurse case management can have a huge impact on resolving claims.

Tsanopoulos said she spends significant sums for the liberal use of nurse case managers. It increases spending up-front but ultimately reduces claims durations and the costs of ongoing claims.

Motivational Interviewing

Over the years, the roles and training of workers’ comp nurse case managers has evolved, experts said.

Today’s nurses, for example, are more likely to be trained in “motivational interviewing,” said Susan DeMarino, vice president of accreditation services at URAC, a Washington, D.C.-based nonprofit that accredits case management and other health care programs.

The training includes best practices for eliciting information from claimants and empathizing with patients who may be mistrustful of the workers’ comp system.

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“Case managers are getting additional training and education on how to ask questions to better engage the injured worker,” she said. “We started hearing about it about five years ago, but we are starting to see it being applied more.”

Of course, how well nurse case managers perform will be up to the individual. Rest assured, the workers’ compensation risk management industry needs as many of the good ones as it can get these days.

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Roberto Ceniceros is senior editor at Risk & Insurance® and co-chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at rceniceros@lrp.com. Read more of his columns and features.
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Sponsored: Helmsman Management Services

Six Best Practices For Effective WC Management

An ever-changing healthcare landscape keeps workers comp managers on their toes.
By: | October 15, 2014 • 5 min read

It’s no secret that the professionals responsible for managing workers compensation programs need to be constantly vigilant.

Rising health care costs, complex state regulation, opioid-based prescription drug use and other scary trends tend to keep workers comp managers awake at night.

“Risk managers can never be comfortable because it’s the nature of the beast,” said Debbie Michel, president of Helmsman Management Services LLC, a third-party claims administrator (and a subsidiary of Liberty Mutual Insurance). “To manage comp requires a laser-like, constant focus on following best practices across the continuum.”

Michel pointed to two notable industry trends — rises in loss severity and overall medical spending — that will combine to drive comp costs higher. For example, loss severity is predicted to increase in 2014-2015, mainly due to those rising medical costs.

Debbie discusses the top workers’ comp challenge facing buyers and brokers.

The nation’s annual medical spending, for its part, is expected to grow 6.1 percent in 2014 and 6.2 percent on average from 2015 through 2022, according to the Federal Government’s Centers for Medicare and Medicaid Services. This increase is expected to be driven partially by increased medical services demand among the nation’s aging population – many of whom are baby boomers who have remained in the workplace longer.

Other emerging trends also can have a potential negative impact on comp costs. For example, the recent classification of obesity as a disease (and the corresponding rise of obesity in the U.S.) may increase both workers comp claim frequency and severity.

SponsoredContent_LM“The true goal here is to think about injured employees. Everyone needs to focus on helping them get well, back to work and functioning at their best. At the same time, following a best practices approach can reduce overall comp costs, and help risk managers get a much better night’s sleep.”
– Debbie Michel, President, Helmsman Management Services LLC (a subsidiary of Liberty Mutual)

“These are just some factors affecting the workers compensation loss dollar,” she added. “Risk managers, working with their TPAs and carriers, must focus on constant improvement. The good news is there are proven best practices to make it happen.”

Michel outlined some of those best practices risk managers can take to ensure they get the most value from their workers comp spending and help their employees receive the best possible medical outcomes:

Pre-Loss

1. Workplace Partnering

Risk managers should look to partner with workplace wellness/health programs. While typically managed by different departments, there is an obvious need for risk management and health and wellness programs to be aligned in understanding workforce demographics, health patterns and other claim red flags. These are the factors that often drive claims or impede recovery.

“A workforce might have a higher percentage of smokers or diabetics than the norm, something you can learn from health and wellness programs. Comp managers can collaborate with health and wellness programs to help mitigate the potential impact,” Michel said, adding that there needs to be a direct line between the workers compensation goals and overall employee health and wellness goals.

Debbie discusses the second biggest challenge facing buyers and brokers.

2. Financing Alternatives

Risk managers must constantly re-evaluate how they finance workers compensation insurance programs. For example, there could be an opportunity to reduce costs by moving to higher retention or deductible levels, or creating a captive. Taking on a larger financial, more direct stake in a workers comp program can drive positive changes in safety and related areas.

“We saw this trend grow in 2012-2013 during comp rate increases,” Michel said. “When you have something to lose, you naturally are more focused on safety and other pre-loss issues.”

3. TPA Training, Tenure and Resources

Businesses need to look for a tailored relationship with their TPA or carrier, where they work together to identify and build positive, strategic workers compensation programs. Also, they must exercise due diligence when choosing a TPA by taking a hard look at its training, experience and tools, which ultimately drive program performance.

For instance, Michel said, does the TPA hold regular monthly or quarterly meetings with clients and brokers to gauge progress or address issues? Or, does the TPA help create specific initiatives in a quest to take the workers compensation program to a higher level?

Post-Loss

4. Analytics to Drive Positive Outcomes, Lower Loss Costs

Michel explained that best practices for an effective comp claims management process involve taking advantage of today’s powerful analytics tools, especially sophisticated predictive modeling. When woven into an overall claims management strategy, analytics can pinpoint where to focus resources on a high-cost claim, or they can capture the best data to be used for future safety and accident prevention efforts.

“Big data and advanced analytics drive a better understanding of the claims process to bring down the total cost of risk,” Michel added.

5. Provider Network Reach, Collaboration

Risk managers must pay close attention to provider networks and specifically work with outcome-based networks – in those states that allow employers to direct the care of injured workers. Such providers understand workers compensation and how to achieve optimal outcomes.

Risk managers should also understand if and how the TPA interacts with treating physicians. For example, Helmsman offers a peer-to-peer process with its 10 regional medical directors (one in each claims office). While the medical directors work closely with claims case professionals, they also interact directly, “peer-to-peer,” with treatment providers to create effective care paths or considerations.

“We have seen a lot of value here for our clients,” Michel said. “It’s a true differentiator.”

6. Strategic Outlook

Most of all, Michel said, it’s important for risk managers, brokers and TPAs to think strategically – from pre-loss and prevention to a claims process that delivers the best possible outcome for injured workers.

Debbie explains the value of working with Helmsman Management Services.

Helmsman, which provides claims management, managed care and risk control solutions for businesses with 50 employees or more, offers clients what it calls the Account Management Stewardship Program. The program coordinates the “right” resources within an organization and brings together all critical players – risk manager, safety and claims professionals, broker, account manager, etc. The program also frequently utilizes subject matter experts (pharma, networks, nurses, etc.) to help increase knowledge levels for risk and safety managers.

“The true goal here is to think about injured employees,” Michel said. “Everyone needs to focus on helping them get well, back to work and functioning at their best.

“At the same time, following a best practices approach can reduce overall comp costs, and help risk managers get a much better night’s sleep,” she said.

To learn more about how a third-party administrator like Helmsman Management Services LLC (a subsidiary of Liberty Mutual) can help manage your workers compensation costs, contact your broker.

Email Debbie Michel

Visit Helmsman’s website

@HelmsmanTPA Twitter

Additional Insights 

Debbie discusses how Helmsman drives outcomes for risk managers.

Debbie explains how to manage medical outcomes.

Debbie discusses considerations when selecting a TPA.

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This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Helmsman Management Services. The editorial staff of Risk & Insurance had no role in its preparation.


Helmsman Management Services (HMS) helps better control the total cost of risk by delivering superior outcomes for workers compensation, general liability and commercial auto claims. The third party claims administrator – a wholly owned subsidiary of Liberty Mutual Insurance – delivers better outcomes by blending the strength and innovation of a major carrier with the flexibility of an independent TPA.
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