By Cyril Tuohy
Lowering the number of fatalities and injuries in the high-risk manufacturing segment isn't easy, and perhaps no company knows it better than International Paper Co., the Memphis, Tenn.-based paper, pulp and packaging company.
To grasp the scope of risks International Paper faces when it considers workers' compensation and disability, and safety and loss prevention programs, reflect on what managers back at the home office are faced with.
In the summer of 2009, International Paper managers received word that a worker had been killed by a timber loading crane at the company's Augusta, Ga. paper mill. Then, came more bad news. U.S. Occupational Safety and Health Administration inspectors found the crane was operating with no warning device, and that safety barriers designed to keep workers away from the equipment were lacking. Inspections found equipment missing, and OSHA proposed fines of $123,000 against the company.
It was a blow, especially given the good news International Paper had received 18 months before, when OSHA praised International Paper's Auburn Container facility in Auburn, Maine, for its commitment to health and safety.
The facility, with 141 employees, was recertified by OSHA for another five-year term at the "star" level, the highest level of the regulatory agency's Voluntary Protection Programs. It was another win for the company's safety and its loss control managers.
The anecdotes illustrate the good news-bad news seesaw International Paper's managers face in trying to impose and promote consistent programs across the 46 states in which it does business domestically.
One paper mill suffering loss of life, then slapped with fines, while another container plant showered in praise from OSHA -- one of 40 International Paper worksites recognized by OSHA's Voluntary Protection Program -- is the kind of inconsistency William Wainscott, International Paper's manager for workers' comp and occupational health would rather do without.
For International Paper's efforts at imposing a consistent approach to workers' comp and disability management, Risk & Insurance® has awarded it an honorable mention in the 2012 Theodore Roosevelt Workers' Comp and Disability Management Award in the for-profit category.
Seeking to impose consistency within the company's return-to-work and absence management programs, Wainscott and his colleagues John A. Williams, director, Global Occupational Health & Safety Services, and Tom Sauer, manager of Integrated Disability Management, have encouraged the use of benchmarking, preferred provider networks, nurse case management, telephonic triage, prescription drug management, and health and wellness initiatives.
The process is identical for workers, regardless of what facility or state they work in, no matter which doctor is treating them, and regardless of the claims examiner involved in the case, according to International Paper.
"One of the big challenges was that we had facilities all over the country, and they all had a different understanding of return to work," said Wainscott. The Americans with Disabilities Act required a consistent approach as well. "We reasoned that if we could standardize the process, we could manage it," he said.
Acquisitions also made standardized approaches difficult. "The locations were used to operating with a lot of autonomy," said Rick Schroder, vice president of client services with Sedgwick Claims Management Services Inc., International Paper's third-party administrator.
Integration of data systems have improved International Paper's ability to consolidate different types of medical leave, and reporting triggers allow the team to specifically identify when the coordination of benefits needs to occur.
Prior to July 2006, the administration of the Family and Medical Leave Act was fragmented and handled at the location level, but since the integration, the company has been able to apply administrative leave far more consistently across all of its U.S. operations.
As soon as an injury is reported, International Paper can track the impact on family medical leave and sick days, and conduct reviews to see if the employee is eligible for salary continuance, sickness and accident, long-term disability and disability retirement benefits. The streamlining has led to shorter claims durations despite a multitude of sickness, accident and disability plan designs negotiated by unions.
Better yet is how it has helped return employees suffering from occupational and nonoccupational injuries to work.
Take the recent occupational injury case of an 18-year-old man operating a stacker who mangled his hand in the chain and sprocket on a machine. The result left him with a partial right hand amputation after losing the second, third, fourth and fifth digits, keeping him out of work for 18 months.
The young victim was eventually fitted with a special prosthesis in the form of a myloelectric hand, and he returned to work at the facility with permanent restrictions based on the manufacturer's guide to use of the prosthetic. He was transitioned back to work successfully, avoiding a lengthy vocational rehabilitation in another occupation, according to the company.
Then, there are the resolved nonoccupational injury cases that never get any attention in the news headlines. Such was the case of a 55-year-old woman diagnosed with osteomyelitis who was returned to work after being on long-term disability.
Following corrective surgery, she used a walker to assist with mobility. In the wake of discussions with a job accommodation specialist and human resources representative, the patient's doctor agreed to have her return to work for four hours a day for two weeks as long as she refrained from bending or stooping. She was eventually able to return to her department full time.
A similarly consistent approach was applied last year when the company implemented its Life Changing and Fatality Elimination program, or LIFE for short. Designed to reduce concussions, amputations, fractures, burns and life-changing injuries affecting the quality of life of the company's employees, overall injures dropped 24 percent, and injuries related to motorized equipment, forklifts, loaders, cranes and trucks, decreased 67 percent, International Paper said.
The successful return to work of International Paper's stacker operator and 55-year-old osteomyelitis victim represent small but important victories in the company's attempt to keep employees off workers' comp and disability rolls through tighter management of its workers' comp and disability management program.
And the company is going to need a lot more of these victories as returning employees to work becomes a bigger challenge in the future. The workforce is aging, and workers want to stay on the job longer, and that means top manufacturing companies like International Paper are going to need to get used to high severity claims even as claims frequencies level off because of better program management.
"We were driving down the number of incidents but the costs were not going down, because of the severity issues," said Wainscott.
Even as injury frequency at the company dropped 32 percent in five years, going from 1,522 workers' comp injuries in 2007 to 1,022 injuries last year, claims costs were rising, the company reported. Total incurred cost per claim went up 33 percent, from $9,390 to $12,508, over the same period -- this even as the total number of International Paper employees covered by the program dropped from 45,862 to 39,209.
Like many manufacturing companies, International Paper has facilities where the average age of employees is in the mid or low 50s, Wainscott said. Many employees suffer from shoulder, knee and back injuries.
Highly skilled employees of the manufacturing sector are valuable, and can pass on their know-how to a younger generation. But when these same veterans get injured, they "heal and react to injury much differently than people in their 20s and 30s," Wainscott said.
Over the past three to five years, Wainscott, his team and Sedgwick, have made it a priority to act on high-severity claims by identifying injury-specific triggers and matching the triggers to the medical management tools early in the life of the claim.
"We act to get doctors, medical case managers, physical therapists involved as soon we can," he said. "If triggers were showing that the claim would escalate, we could target resources early in the claim and drive costs down."
A new database allows Wainscott and Sedgwick to match the restrictions ordered by the doctor to the jobs available at one particular location. "It certainly shortens that window of time and speeds the return to work process," Schroder said.
After fits and starts, and following an integration period during which International Paper added 10,000 new employees to its workers' comp and disability management program through the purchase of Weyerhaeuser's container division in 2008, Wainscott said the programs have made a lot of headway.
International Paper's programs were always good, they just weren't as integrated as they should have been. "We had these programs in place for several years, but they were not necessarily implemented at the right time or on the right claim," Wainscott said.
CYRIL TUOHY is managing editor of Risk & Insurance®. He can be reached at email@example.com.
November 1, 2012
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