Hearing from Employers
Employer engagement and superior service provider performance are acknowledged keys to successfully managing workers’ compensation claims.
Those employers that care enough to produce great results for their injured workers don’t tend to beat their own drums, though.
But they will get an unprecedented chance to share their strategies and practices on a wide range of workers’ compensation topics at the National Workers’ Compensation and Disability Conference® & Expo at the Mandalay Bay Hotel & Casino in Las Vegas, Nov. 19-21.
Two speakers from Harley-Davidson, for example, will discuss claims-mitigation practices that saved their company millions of dollars. Those practices include integrating a variety of company resources including health services, safety and ergonomics expertise.
They will also tell how Harley-Davidson integrated the services of vendor partners, such as BTE Technologies, which helps return injured employees to the job and keeps others working with a post-offer employment testing program that assesses functional ability to safely perform work, said Beth Mrozinsky, the motorcycle manufacturer’s director of safety and health.
Their work has helped address challenges common in many U.S. workplaces, such as those driven by an aging workforce.
Harley-Davidson’s successes also come from integrating vendor partners to help explore loss-reduction processes. The company is increasingly applying those processes to non-occupational injuries after proving them successful in mitigating occupational issues, Mrozinksi said.
“We work really hard with our vendor partners to really pull this together,” Mrozinsky said. “We are almost like one unit that thinks through these processes.”
In another session, speakers Darin Hampton, workers’ compensation regional coordinator at International Paper, and Jodie L. Massingill, senior manager, casualty claims at Sysco Corp., will share their strategies for successfully overseeing a range of services and how they get the best possible support from vendor partners.
In addition to employers, presenters will include representatives from some of the nation’s largest workers’ comp insurers, third-party administrators, brokers, managed care companies and attorneys specializing in workers’ compensation.
Focus on Medical
A growing trend to improve the quality of medical care delivered to injured workers relies on measuring doctor performance to build networks limited to providers capable of producing the best claims outcomes.
Jane Ish, national networks director for Liberty Mutual Insurance, will present a conference session on outcomes-based networks.
“We believe if you start right with the right physician and his entire medical ecosystem — in terms of who he counts on for referring — then you are more likely to have injured workers go back to work quicker and reduced medical costs,” she said.
Randy L. Triplett, workers’ compensation and integrated disability manager for The Goodyear Tire & Rubber Co., will join Ish in the presentation.
Other current challenges and the tools being applied to mitigate them will also receive prominent attention at the conference.
Jim Andrews, executive VP of pharmacy services at Healthcare Solutions Inc., and David Smith, divisional VP of risk management at Family Dollar Stores Inc., for example, will talk about how analytics and predictive modeling help identify and prevent drug abuse.
The nation’s growing diversity and that dynamic’s impact on workers’ comp and disability management will be examined by Jennifer De La Torre, executive director of workforce diversity at AT&T and formerly the company’s director of risk management.
Elizabeth Demaret, executive VP, chief customer relationship officer at Sedgwick Claims Management Services Inc., will join De La Torre.
De La Torre said considerations of racial and ethnic diversity, treatment of veterans in the workforce and age differences are all impacting workers’ comp management strategies.
Expect to hear session topics not commonly offered at workers’ comp conferences, but that nonetheless have significant impact on the industry and employer programs.
Three private equity executives, whose firms owned well-known workers’ comp companies, will discuss the growing influence of private equity in this business. It is unusual for private equity leaders to address a workers’ comp crowd, said Joe Paduda, principal at Health Strategy Associates LLC.
“Private equity people speak at investor conferences and at some other conferences, but never to my knowledge in a workers’ comp-related conference,” said Paduda, who will moderate the session. “Especially folks like these who actually assess the business, follow the workers’ comp industry and really understand it at both a granular and strategic level.”
Paduda promised to allow plenty of time for audience questions.
“We are going to have an extended question and answer [time] just because there is so much interest in the role of private equity in the workers’ comp business,” he said.
Legal and regulatory issues are also on tap.
The Occupational Safety and Health Administration’s 2013 temporary worker initiative directed its field inspectors to place greater emphasis on assessing whether employers using temp workers comply with their responsibilities.
“There has been a lot of postulation about what the ACA’s impact is on the industry.” —Denise Zoe Gillen-Algire, director, managed care and disability corporate risk, Safeway Inc.
Corey Berghoefer, senior VP, risk management and insurance for Ranstad, a global employment services provider, will join two workers’ comp attorneys to discuss OSHA’s initiative and other risk-management considerations accompanying current growth in temp worker hiring.
“I’ll talk about the duties and responsibilities, and how OSHA will come in during an investigation and view each of the parties,” he said.
The Patient Protection and Affordable Care Act is another current topic that conference speakers will weigh in on at a session titled “Healthcare Reform: Strategies You Can Apply Now.”
“There has been a lot of postulation about what the ACA’s impact is on the industry,” said Denise Zoe Gillen-Algire, director, managed care and disability corporate risk at Safeway Inc. and the conference’s program co-chair. “We want to say, ‘OK, what is the takeaway? What does it mean to employers?’ We want to take that information and say, ‘What can you do as employers to manage your workers’ comp program and either prepare or mitigate some of the impacts?’ ”
William Wilt, president of Assured Research, will join Gillen-Algire.
Here are some other presentations:
Opening Keynote: Integrating Employees’ Health and Well-Being to Improve the Bottom Line
L. Casey Chosewood, M.D., is senior medical officer and director of the Office for Total Worker Health Coordination and Research Support at the National Institute for Occupational Safety and Health. Chosewood will demonstrate how to reduce employer costs by integrating occupational health and safety with health promotion and post-injury management.
Session: Modeling Managed Care for Program Impact
Speakers from two large, self-insured employers and a national workers’ comp consultant will explain managed care services and how to evaluate which ones deliver the best outcomes and greatest cost savings.
Speakers: Barry Bloom, principal at The bdb Group; John Riggs, manager of workers’ compensation, Disneyland Resort; and John Smolk, principal manager, workers’ compensation, Southern California Edison.
Session: Risk Financing: Selecting the Best Option for Your Company
Mark Walls, conference program co-chair and VP, communications and strategic analysis at Safety National, will cover a range of considerations for employers weighing various insurance arrangements. From buying first-dollar coverage and large deductible programs to self-insuring, he will lay out the key considerations for each.
Session: Loss Mitigation of High Value Workers’ Compensation Claims
Hear about risk analysis that can identify old claims previously considered incapable of being resolved. The session will seek audience participation while discussing several cost drivers such as treating-doctor issues and Medicare set-asides.
Speakers: Christianne Quinn, national workers’ compensation manager at Pep Boys; and David R. Kunz, managing partner at Kunz & Germick.
Session: Behavior-Based Safety Program: How You Can Prevent Injuries and Improve Product Quality
Safety and product quality go hand in hand, so a behavior-based safety program stands to improve loss prevention and high-quality production throughout a company.
Speaker: Julia Sfurm, corporate senior risk operations manager, Elkay Manufacturing Co.
Visit www.wcconference.com/agenda.html for a look at the conference’s complete agenda.
Not long out of college, Elizabeth Ruff arrived at Peerless Industrial Group in June of 2011, tasked with taking control of workers’ compensation for the company. She soon discovered that the company had a culture of lost time and that really bothered her.
“She said, ‘We’ve got to put a stop to this hemorrhaging,’ ” recalled her boss, Vice President of Human Resources Barbara Breza.
Ruff was intent on getting employees back to work, in some capacity, as soon as possible.
“One of the first things I initiated is that whenever somebody was injured on the job and they required immediate medical attention, either myself or Barb would actually go with the employee to the health care provider’s office and sit with them,” said Ruff.
“The reason that was really key was because we were able to talk to the doctor about the fact that Peerless accommodates almost every type of light duty or transitional option,” Ruff added.
Before Ruff began her new approach, Peerless had 40 lost-time claims, multiple years in a row.
“In 2012-2013, with a total of 386 employees in the company, we had it down to less than 25 claims,” said Ruff.
At the company’s main plant in Winona, Minn., which has 287 employees, Peerless has gone 700 days without a lost-time claim.
“It’s a pretty heavy-duty industrial manufacturing plant, so that’s a huge accomplishment, which we’re extremely proud of,” said Ruff.
“The head of underwriting at a major insurance company recently said that he has never seen anyone like Elizabeth at a company, big or small. She is truly one of a kind and a major difference-maker in our industry.” — Josh Warren, senior vice president of Equity Risk Partners
Josh Warren, senior vice president of Equity Risk Partners, Peerless’ broker, said, “They do have some additional lifting machines that make it easier on the employees, but the main difference is that Elizabeth and her colleagues in the HR department pay attention to their employees, learn from workplace injuries in order to avoid repeat situations and get people back to work.”
Warren added: “The head of underwriting at a major insurance company recently said that he has never seen anyone like Elizabeth at a company, big or small. She is truly one of a kind and a major difference-maker in our industry.”
Other accomplishments Ruff has initiated at Peerless include bolstering the company’s safety program. Safety is particularly important at Peerless because it is the largest manufacturer and distributor in North America for industrial and consumer chain and tractor products.
“One of the things I created was regular training programs,” Ruff said. “Each month, there is some type of training program project I am organizing, whether it is bringing in an external expert or coordinating with an internal supervisor.”
Another thing Peerless has done is to spend more money on capital each year to be proactive rather than reactive.
“Each year since 2011, we’ve been adding $20,000 per year just in capital for hoists,” she said.
Under Ruff’s direction, Peerless has also been aggressive in implementing ergonomic improvements, Breza said.
Ruff still works 20 hours a week at Peerless, while also working at BIC Graphic, which she joined in June.
“What I value most about Elizabeth is her knowledge and expertise and professionalism in the field of HR and how broad-based she is and that she came in that way to Peerless when she was so young,” said Breza. “She is just so intelligent.”
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Six Best Practices For Effective WC Management
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.
“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:
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?
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.
Debbie discusses how Helmsman drives outcomes for risk managers.
Debbie explains how to manage medical outcomes.
Debbie discusses considerations when selecting a TPA.
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.