DMEC 2016

Reaping the Rewards of Benefits Integration

Participants in the 2016 DMEC Annual Conference shared ideas on benefits integration and effective wellness strategies.
By: | July 21, 2016 • 4 min read
Business Connection

Discussions at this week’s Disability Management Employer Coalition conference held in New Orleans included measures for keeping employees healthy, injury free, and on the job.

Conference participants also reviewed risk reduction, ease of administration, and cost saving advantages obtained by integrating absence management and disability benefit programs such as workers’ compensation, the Family and Medical Leave Act, and short-term disability offerings.

Karen English, partner, Spring Consulting Group

Karen English, partner, Spring Consulting Group

Proponents say integration makes sense because of overlaps among the range of programs under which workers can be absent and the cost to organizations regardless of the reasons for missed work days.

They also point to potential compliance risks when the administration of programs is segregated and improperly aligned.

“There is hardly any situation where there is just one perfect claim going on,” said Karen English, a partner at Spring Consulting Group. “If someone is [out] on workers’ comp, they are probably on FMLA [and] STD. Then we have all our concurrent leaves going on. So keeping workers’ comp to the side can actually be viewed as a risk to your organization.”

Failing to integrate can lead to lost opportunities, such as the ability to appropriately minimize the amount of time employees spend away from the job by concurrently running FMLA leave with a workers’ compensation absence.

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“Just as an example, if you have a workers’ comp claim and that person is out eight weeks for a surgery, if you don’t run it concurrently, you are allowing that employee to come back from that workers’ comp claim and then go out for 12 additional weeks of FMLA time,” said Trina Mouton, manager of disability management and wellness at CenterPoint Energy.

“So it is really advisable to run those concurrently,” Mouton continued. CenterPoint experiences a 2-to-1 return on investment from its efforts, she added.

Employers speaking at the conference cited their gains from integrating programs, although their results are also influenced by several efforts including implementing return-to-work programs.

“We compare ourselves to the hospital industry in terms of [employee restricted-duty days] and lost time,” said Jane Ryan, return to work recovery and claims services at Mayo Clinic. “Our lost time rates are actually lower than the national industry [average] and I think that speaks to the ability we have to keep people at work or return to work early.”

“There is not one silver bullet or only one way to integrate benefits delivery. Every company is so different.” — Karen English, partner, Spring Consulting Group

The paths that employers take to integration and the programs they integrate vary considerably depending on each company’s needs, speakers said.

“There is not one silver bullet or only one way” to integrate benefits delivery, English said. “Every company is so different.”

English will join DMEC’s CEO, Terri Rhodes, in a discussion on how to integrate workers’ comp, disability, and leave programs on Dec. 1, at the National Workers’ Compensation and Disability Conference® & Expo that will also take place in New Orleans.

Targeted Wellness

At the DMEC conference held this week, meanwhile, other discussion topics focused on specific illnesses and corresponding wellness efforts for keeping employees healthy and productive.

Diabetes, for example, impacts employers’ profitability by driving medical costs that are 2.3 times greater than for people without the illness as well as by increasing employee absences and work disruptions.

“There is no question that diabetes affects the bottom line,” said Matthew Ceurvels, director of disability products at Sun Life Financial. “Productivity can be impacted by presenteeism, when an employee is working sub-optimally, by ad-hoc absences, and by long-term absences when employees go out on a disability claim.”

More employer disease management programs focus on diabetes than on other common illnesses like asthma or heart disease, Ceurvels said.

Diabetes care, for example, is a key component of a wellness program CNIC Health Solutions Inc. offers its workers, said Linda Benedict, human resources manager for the third party administrator of employee benefit plans.

CNIC Health Solutions’ employee wellness program’s overall offerings include a recreation center, free access to a CrossFit trainer, encouragement to engage in desk exercises, and online health assessments tied to biometric screenings that provide employees with  private information about their individual risk factors.

As part of its health plan, the company also provides free monitoring and testing supplies for diabetes sufferers along with a third-party tracking service for the diabetes testing results.

“We also offer a discount on what the employee pays for their portion of health insurance premiums,” Benedict said. “That is one of the biggest components of our wellness program.”

The discount works as an incentive, providing employees with a 25 percent health care premium reduction, first for participating in the biometric screening, and then as they maintain a certain screening result level.

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That led to a 23 percent improvement in employee health risk over one year, as measured by the biometric screenings.

The wellness efforts have improved employee engagement and morale, lowered workers’ comp losses and reduced absenteeism, she said.

“One key metric for us is that in the last year and a half, we have not had one FMLA leave,” Benedict said. “It has really limited FMLA leave for our employees because they are more engaged. They are taking care and looking at their metrics, and sharing them with their physicians. It is really starting to pay off.”

Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.
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Injury Prevention

Sensors Show Promise for Recovery and Prevention

Biomechanical sensor technology has broad applications for preventing re-injury and correcting movements that cause injuries to occur.
By: | June 27, 2016 • 4 min read
Man With Pain In Elbow. Pain relief concept

Emerging technologies in biomechanics offer huge promise for the workers’ compensation world.

Take the Motus Pro: a multi-sensor training tool that tracks the throwing and batting movements of baseball players, particularly those who are rehabilitating from injuries.

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Developed by the Massapequa, N.Y.-based biomechanics software and analytics firm Motus, the sensor provides feedback to baseball teams’ medical staff to aid in their return-to-play programs.

But the firm has always set its sights beyond baseball, developing its physics engine, hardware and training tools in a manner that would allow the firm to eventually address the larger population beyond athletes, said co-founder and chief executive Joe Nolan.

“We are starting to work on early projects with partners outside the world of sports to refine applications that can be applied to worker safety, human performance optimization and evidence-based, quantified-outcome physical therapy programs,” Nolan said.

Zack Craft, vice president of rehab solutions and complex care education, One Call Care Management

Zack Craft, vice president of rehab solutions and complex care education, One Call Care Management

There are dozens more products like the Motus Pro that could have a place in the workers’ comp industry, including some of the wearable technology currently being used in baby sensors and monitors to track fetal movement in the womb, said Zack Craft, vice president of rehab solutions, complex care education at One Call Care Management in Jacksonville, Fla.

Wearables could be used in the ergonomics space to potentially prevent carpel tunnel syndrome by monitoring the position of the elbow, total muscles used and the speed of muscles being used by employees during the workday, Craft said.

If a worker has already filed a claim for carpel tunnel, the tool could be used to monitor appropriate positioning and could validate recommendations and potential retraining by providing solid outcome data.

“The small sensor is easily attached using a plastic clip on a glove or through the use of a compression garment,” he said. “For individuals working in an office environment, a very simple postural device can really help them learn to avoid poor positions and improve their posture.”

Wearable technology also has the potential to benefit clinical studies, Craft said. An example is the impact wearables can have on paraplegic patients in the prevention of shoulder injuries such as rotator cuff damage.

Sensors could be used to evaluate the movements of paraplegics in wheelchairs to determine whether they are properly forming a full propelling stroke to avoid damage to their wrist or shoulders.

“This data could then be collected and used to educate the injured worker and any caretakers to prevent the development of bad habits, or to help them relearn appropriate movements,” he said.

“Prevention of these types of injuries is key for paraplegics since the use of their shoulders is critical to complete transfers and pressure shifts.”

Apple recently announced an enhancement to its new Health app to assist wheelchair users in tracking their wheelchair propelling strokes as well calorie burn, periodically reminding them to stay active and take a “roll” around the block, Craft said.

“Wouldn’t it be great if we were able to get an injured worker in physical therapy to upload their exercise information to their workers’ comp treating doctor and claims manager, to see if they were meeting their daily goals?” — Dr. Teresa Bartlett, SVP, medical quality, Sedgwick Claims Management Services

Kathryn L. Havens, assistant professor of clinical physical therapy at the University of Southern California’s Division of Biokinesiology and Physical Therapy in Los Angeles, said that sensors have many great applications, but the difficulty is processing and interpreting all of the data.

Havens has had many discussions with other biomechanists about how to detect certain movement patterns from these velocities and accelerations, because the output from sensors “isn’t so straightforward.”

Dr. Teresa Bartlett, SVP, Medical Quality, Sedgwick Claims Management Services

Dr. Teresa Bartlett, SVP, medical quality, Sedgwick Claims Management Services

“I think there is potential and engineers are developing better algorithms for this,” she said. “But at this point we still need trained movement scientists to analyze the data from these sensors in order for the data to be useful.”

Dr. Teresa Bartlett, senior vice president, medical quality at Sedgwick Claims Management Services Inc., believes that technology will eventually be interspersed throughout all of medicine.

“In fact, I am looking for a client that wants to engage some wearable technology in a workers’ comp setting,” Bartlett said. “There are large manufacturers that could benefit from a health and safety perspective.”

Preventing Claims

Bartlett believes there is a place for such emerging technologies in a manufacturing setting to help prevent worker injuries. For example, sensors could be used by people to prevent elbow and shoulder injuries, to understand mechanics, thrust and the amount of energy it takes to perform certain jobs.

Moreover, existing technologies like the Apple Watch or Fitbit could help mitigate low back strain by getting workers to walk more during the day, Bartlett said.

“Wouldn’t it be great if we were able to get an injured worker in physical therapy to upload their exercise information to their workers’ comp treating doctor and claims manager, to see if they were meeting their daily goals?”

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It would also help practitioners better understand if injured workers are being compliant with the quality of their exercise programs and to understand duration and intervals, she said.

For example, practitioners could determine whether workers are walking only in small increments such as one-minute intervals to the bathroom, whether they are walking five miles in one exercise period, or whether they’re walking five miles in one-mile increments.

“This information could make a big difference in their treatment plan and discussion with their doctor or nurse case manager,” Bartlett said.

Katie Kuehner-Hebert is a freelance writer based in California. She has more than two decades of journalism experience and expertise in financial writing. She can be reached at [email protected]
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Sponsored: Liberty Mutual Insurance

Buyers Beware: General Liability Outlook May be Shifting

Buyers should focus on building a robust GI program and risk management infrastructure to lessen the impact of emerging GI trends.
By: | July 5, 2016 • 6 min read

The soothing drumbeat of “excess capital” and “soft market” to describe the general liability (GL) market is a familiar sound for brokers and buyers. Emerging GL trends, however, suggest the calm may not last.

Increasing severity of GL claims may hit some sectors like a light rain at first, if they have not already, but they could quickly feel like a pelting thunderstorm in others. A number of factors could contribute to the potential jump in GL prices for certain industry segments or exposures, possibly creating “micro” or niche hard markets in the short-term, and maybe even turning the broader market over the longer-term.

“There are trends we’re seeing that will play out slowly. Industries that carry more general liability exposure will and have been hit first and hardest, but it won’t apply across the board initially,” said David Perez, Senior Vice President and Chief Underwriting Officer, for Liberty Mutual Insurance’s National Insurance Specialty operation. “There is ample capital in the market today, which allows a poor performing account to move its policy frequently from carrier to carrier. Poorer performing classes, however, will likely face increased pricing for GL policies and a reduction in capacity.”

The good news for buyers is that they can take action today to lessen the impact these trends and the evolving market may have on their GL programs.

David Perez on the state of the GL market.

Medical and Litigation Trends Drive Severity

One factor increasing claim severity is the rising cost of health care, driven both by greater demand and by medical inflation that is growing faster than the Consumer Price index.

The impact of rising medical costs on commercial auto is well-known. Businesses with heavy transportation exposures are finding it more difficult to obtain coverage, or are paying more for it.

That same trend will impact general liability, just on a slower and more fragmented basis.

LM_SponsoredContent“In light of these trends, brokers and buyers should seek to understand how effectively their current or potential insurers defend GL claims, particular in using evidence-based medicine to assess and value the medical portion of a claim, and how they can provide necessary care to claimants while still helping clients control their total cost of risk.”

— David Perez, Senior Vice President & Chief Underwriting Officer, National Insurance Specialty, Liberty Mutual Insurance

“It takes longer for medical inflation to register through the tort system in general liability than it does in auto liability (AL) because auto claims are generally resolved more quickly,” Perez said. “But the same factors affecting severity in AL also exist in GL and as a result, it’s foreseeable that we will not only see similar severity trends in GL, but they may in fact be worse than we’ve seen in commercial auto.”

Industries with greater exposure to severity in general liability claims should be the first wave of companies to notice the impact of medical inflation.

“Medical inflation will drive up costs across the board, but sectors like construction and product manufacturing have a higher relative exposure for personal injury lawsuits.”

The impact of medical inflation on the GL market.

Beyond medical inflation, two litigation trends are increasing GL damages. First, plaintiffs’ lawyers are seeking to migrate the use of life care plans—traditionally employed only for truly catastrophic injuries—to more routine claims.  Perez recalled one claimant with a broken thumb and torn ligaments who sought as much as $1 million in care for the injury for the rest of his life.

Second, the number of allegations of traumatic brain injuries (TBI) in GL claims is growing.  It can be difficult to predict TBI outcomes initially and poor outcomes can be expensive and long tailed.

“In light of these trends, brokers and buyers should seek to understand how effectively their current or potential insurers defend GL claims, particular in using evidence-based medicine to assess and value the medical portion of a claim, and how they can provide necessary care to claimants while still helping clients control their total cost of risk,” notes Perez.

Changing Legal Landscape

Medical inflation and litigation trends are not the only issues impacting general liability.

Unanticipated changes in court interpretations of policy language can throw unexpected pressure on GL pricing and capacity.

Courts sometimes issue rulings interpreting policy language in a manner that expands coverage well beyond the underwriter’s original intent. Such opinions may sometimes have a retroactive effect, resulting in an immediate impact on not only open, but also closed cases in some circumstances.

Shifts in the Marketplace

In addition to facing price increases, GL brokers and buyers will be challenged by slightly shrinking capacity due to consolidation and repositioning among carriers in the marketplace. “Some major carriers have scaled back their GL writing, resulting in a migration of experienced senior management. As these executives leave, they take their GL expertise and relationships with them, resulting in fewer market leaders and less innovation,” Perez said.

“Additionally, there are new carriers coming into the business that may not have the historical GL loss data to proactively identify trends or the financial strength and experience to effectively service their GL customers and brokers. Both trends make it important for brokers and buyers to work with an insurer that is committed to the GL market and has the understanding and resources to help better manage risks impacting customers.”

Last year saw a high level of mergers and acquisitions in the insurance industry. Buyers should take advantage of that disruption to re-evaluate their needs and whether their insurers are meeting them.  Or better yet, anticipating them.

What’s a Buyer to Do?

Buyers—and their brokers— should look to partner with insurers that can spot emerging trends and offer creative solutions to address them proactively.

What should buyers and brokers do, given the trends facing the GL market?

“Brokers and buyers should value insurers that have not only durability and a long history in the general liability business, but also a strong risk management infrastructure,” Perez said. “Your insurer should be able to help you mitigate your specific risks, and complement that with coverage that works for you.”

Beyond robust GL claims and legal management, Liberty Mutual also provides access to one of the insurance industry’s largest risk control departments to help improve safety and mitigate both claim frequency and severity.

In addition, notes Perez, “Even if a company has a less than optimal loss history in general liability, there can be options to provide adequate coverage for that company. The key is to partner with an insurer that has the best-in-class expertise, creativity, and flexibility to make it happen.”

By working closely with their insurers to understand trends and their potential impacts, brokers and buyers can better prepare for the possible GL storm on the horizon.

To learn more about Liberty Mutual’s general liability offering, visit https://business.libertymutualgroup.com/business-insurance/coverages/general-liability-insurance-policy.

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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 Liberty Mutual Insurance. The editorial staff of Risk & Insurance had no role in its preparation.

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Liberty Mutual Insurance offers a wide range of insurance products and services, including general liability, property, commercial automobile, excess casualty, workers compensation and group benefits.
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