Executive Summit speakers weigh in on comp challenges, solutions
Moderated by Mark Walls, the general session will give conference attendees the opportunity to gain insight into the minds of executives from a variety of realms in the workers' comp system.
Here are the viewpoints of several participants on what they consider the biggest challenges facing the system and how they believe the industry should be addressing them.
Third-party administrators. "The paramount issue for workers' comp today and into the future is the continued increase in the cost of medical treatment," wrote Kenneth F. Martino, president and CEO of Broadspire. "While we have added a number of medical cost containment solutions to the workers' comp process, there continues to be a medical cost trend that is difficult to contain let alone stop."
As Martino explained, the underlying issue of the general health status of the American population presents a complex set of variables to control in order to truly impact the medical cost trend.
Martino outlines three solutions:
- Americans need to get healthier. Education and reform are needed to drive home the health issues, with the medical community, government, and the population recognizing this as a critical issue.
- Developing analytic methodologies that address the underlying cost drivers, remembering that total cost equals per treatment cost times utilization.
- Better medicine. A more rigorous set of protocols for treatment with scientific evidence of results.
The "inherent conflict" in the system due to applicants' attorneys paid based on poor recovery -- high PD -- for the injured workers is troubling to Tom J. Veale, president of TRISTAR Insurance Group. "If applicants' attorneys were, somehow, reimbursed based on achieving good recoveries for the injured worker, then the goals of most stakeholders -- with the possible exception of the treating physicians -- would be more in alignment."
He also believes the system is overly complex to administer, partly due to "poor legislation sponsored by the many stakeholders."
Veale's solutions include trying to align stakeholders' goals by basing applicants' attorney's fees on the recovery of the injured worker versus impairment level, developing incentives for effective medical treatment and recovery, and having the industry or states develop an independent medical evaluator system to measure effectiveness of recovery, permanent impairment, return to work, and future medical care.
Broker perspective. Health and safety issues surrounding older workers must be addressed by employers, says Mark Noonan, managing principal of Casualty Practice for Integro Insurance Brokers. "Employers can start by revising job descriptions and knowing every detail each work task entails in order to help prevent costly and unnecessary workers' comp claims while promoting health and wellness programs for all employees."
Telecommuting is another growth area that will need to be address by the workers' comp system, Noonan says. "The workers' comp exposure remains the same for employers yet they have less control over the work environment and the activity of the employees."
Among his suggestions to employers are to establish telecommuting policies, develop training for employees and supervisors, require separate office areas, set fixed work hours with breaks, and implement ergonomic procedures.
The state-based structure of the workers' comp system creates inherent challenges, says Janet Warren, managing director for Beecher Carlson. Additionally, the issues of the aging workforce, comorbidities, access to quality medical care, chronic pain management, and narcotics use and abuse are also high on her list.
"Our industry will have to take an interdisciplinary approach to solving these challenges," she says. "We have to engage all of the players as we create solutions. We must share our data and engage in a team approach to solution-focused analysis, coordinated solution implementation, open industry communication, and education."
Employer view. The "archaic system to deliver health care and indemnity benefits to injured workers" is the biggest challenge to the system, according to Katrina Zitnik, director of workers' compensation for Costco Wholesale. She believes a "comprehensive review of state workers' comp systems to determine viability/solutions for the next 100 years" is needed.
The growth in "Monday morning injuries" is a concern for Karen Caterino, risk manager for the State of Nevada. "The combination of group health benefits costing more in terms of premium dollars and higher deductibles, stagnant or decreasing wages, and growing obesity rates could turn into a tsunami headed towards workers' comp benefits."
Her solutions begin with employers focusing on "robust and well-funded wellness initiatives under group health insurance and utilizing a carrot/stick approach to changing behaviors that decrease chronic diseases associated with obesity." She also suggests thoroughly investigating workers' comp claims before acceptance.
Chronic pain and "its challenges as it presents itself in prior year workers' comp claims" is among the main challenges, according to Maureen McCarthy, the senior vice president and manager of commercial market claims and managed care for Liberty Mutual Group. Additionally, data capture, input screens, and pull-down menus, and "how they impact the way claims adjusters work and how it's changed their perception of their work" is another. "Where's the data field for critical thinking and old-fashioned case handling strategies? How are critical relationships with employees, employers, and providers impacted?"
More attention on early use of narcotics -- especially in soft tissue claims, as well as more attention early in the claim on how the injured worker is recovering compared to evidence-based medical guidelines are needed for chronic pain abuse. "If the recovery is impeded, early intervention steps are needed," she says.
There should be a balance between data capture efforts and drop-down menu usage, she says. "Companies need to invest more to electronically capture data and feed it to their operating systems," McCarthy says. "Claims adjusters need to be freed up and allowed to think and use their full skill set, especially on potential outlier claims."
Read more at the WorkersComp Forum homepage.
November 3, 2011
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