Defensibility of Workers Compensation Claims

Defensibility of Workers Compensation Claims

Gary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLAPrincipalStrategic Claims Direction LLC(678) 520-37391

WC Defensibility2#1 topic requested by Georgia PRIMA membersStateCitiesCountiesRisk poolsSchool districtsWater & sewage authoritiesShared concern regardless of entity

2

WC Defensibility3Displeased with outcomesMediationHearingsTrialsWhy are we not getting the desired results?What can we do to improve the outcomes?

3

WC Defensibility4Different program typesRisk Managers, HR Managers, Safety Managers, Finance Managers, and othersSelf-administered or TPA-administeredContractors and vendors used in different waysIn-house counsel or outside counsel

The issues are the same regardless of your program type, structure, administration model, or size.

4

WC DefensibilityWhy arent we getting the desired results?Common refrains on why we arent winning more cases:The deck is stacked against us employees always winThe unions work against usWe have too many employees with entitlement mentalities 5

WC Defensibility6Why are we not getting the desired results?Our supervisors dont handle it properly The claims administrator is doing a poor job of managing the claimsDefense counsel dropped the ball

We will take a broad view of WC defensibility and what we can do to improve it.

6

WC DefensibilityDefensibility The Free DictionaryCapable of being defendedprotectedjustified

7

7

WC DefensibilityDefend Successfully repel attackersProtect Maintain safe place for the people and resources or assets that we valueJustify Our actions are respected, supportable, and affirmed

8

WC Defensibility9LIFE OF A CLAIMDEFENDPROTECT

9

WC DefensibilityInherent presumption in this definition is that we and our employees are all:Concerned about our employeesActing in good faithFollowing Georgias WC requirementsSeeking the most appropriate care for the injured employeeTrying to eliminate or significantly reduce time off from work10

11

turnips

WC Fraud3 Most Common Types of Workers Comp Fraud - Claims magazine November 2014AbusersOutright fraud injury did not occur at workOpportunistsInjury occurred at work but employee has performance issues, is uncooperative, and seems to extend time offForgotten and/or uninformed employeesNot fraudulent but frustrating and eventually may be viewed unfavorably

12

12

WC Defensibility13

We spend a lot of our time on the fewer claims from ABUSERS & OPPORTUNISTSThe rest are the claims of UNINFORMED or FORGOTTEN EMPLOYEES that can be reduced through assertive and disciplined claims handlingALL OF THESE CLAIMS CAN GENERATE SIGNIFICANT CLAIMS COSTS

Forgotten and/or Uninformed EmployeesRegular people who have lost their way and we suspect them of fraud / malingeringUnaware of or unclear about requirementsHurt and in painMay have other physical problemsSeeing medical providers they dont knowDont understand medical and WC terminology and proceduresOften get little information from informed sourcesAre financially stressed, worried about their jobs/futureMay get misleading information and advice from family & friends

14

Personal Experience15

What do we do?How do we handle these claims from different types of employees?AbusersOpportunistsForgotten employeesWhat can we do about these cases?

16

How do I make time for this?17

Im already doing a balancing act!

Maybe the better question is:Will you have more time in the future to spend on these issues, and will you get better results if you dont change anything?18

How do we get there from here?

19

20

BEAR WITH ME

Claims are Hard to PredictEmployers dont know at the outset which claims will become the most costly or most difficult to manage Employers must be consistentPrepare for assertive claims handlingAdhere strictly to the plans and proceduresExecute all steps with discipline

KNOW WHAT TO DO AT THE RIGHT TIME FOR THE RIGHT RESULTS

21

To be efficient & effective - Do it right the first timeCreate a clear path for claims handlingMake sure the claims are being managed wellAct with a sense of urgencyEnsure that employees get the information they needInvestigate promptly and fullyEvaluate based on objective facts, not favoritism or politicsChoose your battlesManage expectations

22

WC DefensibilityYogi Berra - If you dont know where you are going, you might wind up someplace else.23

Contributing Factors24Contributing factors to unsuccessful WC defensibilityLack of Leading Industry Practices unstated, inadequate, and/or inefficient claims management expectations, procedures, and activitiesUnclear or undefined roles and responsibilities - roles of the public entity representatives, the adjusters, the nurse case managers, the defense attorneys, etc.Poor execution or follow-through

24

WC DefensibilitySuccessful defensibility relies upon proper planning and efficient execution before AND after an incident occurs. Dont have a procedural goose egg before the incidents occur.25LIFE OF A CLAIM

NO PLANS

WC DefensibilityCase may start to unravel before the incident occursLack of notification and knowledge regarding claims reportingInadequate reporting procedures, uninformed or uncooperative supervisorsInefficient processes to manage claims once incidents occur

26

WC DefensibilityDISCIPLINEThe difference between a successful defense and an unsuccessful defense is often due to the difference in the level of detailMaintain a strong sense of urgency throughout the life of a claimTake decisive stepsDont let the claim languish

27

Theme: Keep Calm, Sail On28

Which do you want?

OR

Theme: Keep Calm, Sail On29

To have happy sailingHave a steady captainExperiencedCommittedUnderstand the seas aheadStudy & analyzeLearn from past mistakesPrepare for the voyageIdentify the destinationCreate detailed maps and directions

Theme: Keep Calm, Sail On30

To have happy sailingGet the right crew / define your dutiesTPA or self-administer?Qualified personnelContinuing trainingClear expectationsChart your course and check it regularlyCompare where you are against known guides

WC Defensibility31

To have happy sailingExecute confidently

Discipline - Pre-IncidentPre-incident planning and preparationHire right employees for the jobsDischarge the wrong peoplePromote right workers to supervisors and managersSet up prompt reporting processes & methodsSelect medical panel & post itInform employees of the medical panelDevelop special claims admin. service instructions Inform employees of reporting responsibilities

32

REPEAT

Discipline Pre-IncidentPre-incident planning and preparationMake the right decision self-administer or use a TPACreate a Stay at Work / Return to Work (SAW/RTW) programSelect right vendorsIn-house counsel vs. outside counselManaged Care OrganizationsTriage NursesMedical Bill Review / Re-pricingTelephonic or Field Case ManagementUtilization ReviewDurable Medical EquipmentPharmacy Benefit Management33

Discipline Pre-IncidentPre-incident planning and preparationSelect right claims system or risk management information system (RMIS) Efficient claims operationCapture key informationCreate meaningful reportsAllocate claims costs back to departmentsSet up performance measurements for claims administrator and for departments / divisions

34

Discipline Incident Response35

ReportingTo the supervisor or designated personCompleting the Supervisors ReportCompleting the First ReportGetting the report to the TPASetting up and assigning the claim

Discipline Incident Response36

Reporting, set-up, and contact lag times

Incident dateDate EE reported to Supv.Date Supv. compl. invest.Date FROI compl.(WC-1)Date sent to Claims Admin.Date Claims Admin. set up / assignedFri., 3/20Mon., 3/23Tues., 3/24Wed., 3/25Thu., 3/26Fri., 3/27Cumulative Days Expired034567

Possible first contact with employee

Discipline Incident Response37

Reporting and Initial Contact if not done promptly, it may be several days before someone starts managing the claim.What are the dangers?Employee sees unauthorized medical providersEmployee is uncertain and stressed getting no directionFriends & family give misleading advice and informationWitnesses and co-workers may be unavailable / coachedFacts of the claim become murkyEmployee may become represented

Discipline Incident Response38

Investigation Often one of the biggest weaknessesSlow to initiate may be days or weeks after claim occurred and was reportedCursory - Adjuster asks Do you have any reason to doubt this claim?Sometimes performed by unqualified persons public entity representativesLacks timely follow-up - Whats next?Sometimes based solely on medical providers opinionRequests medical information late

Discipline Incident Response39

Investigation - 2 layers1.Did it happen on the job?SupervisorOften more of a cursory effortLoss ControlWhat can be done to prevent this in the future?Claims AdministratorCompensability Did it arise out of and in the course of employment (AOE/COE)?Employers simple lack of doubt that the injury occurred is not the only compensability determinant

Discipline Incident ResponseInvestigation some possible questionsWhere did it happen? Did it happen at another companys site?Was there evidence at the site?Was the employee where s/he should have been?What caused the employee to slip / fall ?Does the employee have health conditions that might have caused this?Did another employee or contractor play a part?Did the employee tell others about his/her complaint?

40

Discipline Incident Response41

Investigation 2 layersWhat do we need to know to manage this claim well?What is the injury, the diagnosis, the prognosis, the treatment plan, expected time off from work (if any)?What is the employees usual job and can the employee perform that job continue to work? Is this a motivated employee who will do what s/he can to get appropriate treatment and get back to work?

Discipline Incident Response42

Investigation 2 layersWhat do we need to know to manage this claim well?Does the employee have any other conditions, injuries, illnesses, or other circumstances that might delay recovery?Did the incident occur at another site or in a way that makes a third party potentially responsible for payment?

Compensability Decision43

Questions to ask yourselfHave you been able to complete the investigation before the first indemnity payment is due?Have you investigated the claim fully and promptly?Are the facts and details clear?Is the compensability decision clear, or is there room for interpretation?When required, can you replicate the information and facts on which you based the decision?

Compensability DecisionAre we accepting and denying the right claims?If we suspect a claim is not legitimate, how do we manage the claim until we have the proof?What do we do if we cant prove it?44

If Some Aspect of Claim is Being Contested45

Should the claim be at this stage in the first place?Has the claims administrator maintained ongoing contact?Has the employee been properly informed throughout the life of the claim?If the employee is represented, has the claims administrator had an ongoing discussion with the employees attorney?What are the issues?Should they have been resolved?If so, why havent they been resolved?

Defense Counsel Considerations46

In-house or outside counsel?Advantages and disadvantages of each?Managing litigationLitigation management guidelinesRegular meetings and discussionsEvaluate successCompare return on investment (ROI)Success versus costs

Preparing Defense47

Proper Description of Respective DutiesClaims Administrator ResponsibilitiesInvestigation and Compensability issues should be resolvedEmployees condition should be well knownAction plan / resolution goals should be well definedKeep claim movingKeep defense counsel accountable

Preparing Defense48

Proper Description of Respective DutiesDefense Counsel ResponsibilitiesLegal adviceUnder Claims Administrators directionPerform directed discovery Inform Claims Administrator of all important developmentsDiscuss action plans / resolution strategies with Claims AdministratorTry case

Make an Early Decision49

Resolve or Contest?If ContestComplete discoveryObtain needed informationGet it to the hearing quickly

Avoid spending thousands of $$$ on defense and then settling on the courthouse steps

Summary - WC Defensibility50

Better outcomes based onConsistencyDefining your pre-incident and post-incident proceduresClarifying roles and responsibilitiesMaintaining a sense of urgencyExecuting your plans

Questions / Comments?51

CONTACT INFORMATIONGary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLA(678) 520-3739Gary.Jennings@StrategicClaimsDirection.com