A HOLISTIC APPROACH TO WORKERS’
COMPENSATION LOSS PREVENTION
AND CONTROL
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Andy Tolsma
INTRODUCTION
Administration of a “Holistic” Workers’ Compensation LossPrevention and Control Program is a team function thatrequires the efforts and commitment of numerous partici-pants. Corporate Leadership, Human Resources, Safety,and operational Department Managers all play a crucialrole in the process. Where one partner fails to perform asneeded, the efficacy of the entire program is under-mined.
There are three phases to the process: prevention,control, and learning from mistakes. Here again, whereone phase is not fully applied, failure can result.
Where the program is fully applied and successful, thebenefits can take the form of financial savings, improvedproductivity and even improved employee morale.
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PREVENTING LOSS
Detailed Job Descriptions:
Carefully identify physical and other demands of the essential job
functions. Also document intellectual, linguistic and other require-
ments.
Use the job descriptions as the foundation for candidate inter-
views.
Benefits:
Proper match of job requirements to candidate abilities
Matrix of physical job demands for all jobs can serve as a resource
when attempting to administer an alternative duty program when
injuries occur
Compliance with Americans with Disabilities Act
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MEDICAL SURVEILLANCE Pre-employment Physical Examinations
Exams designed to ensure physical capabilities of the candidateconform to job requirements
Pre-employment and/or Periodic Medical Surveillanceas required by corporate or regulatory agency mandate(OSHA, MSHA, DOT, etc.) Exposure-specific blood work, hearing and vision
testing, pulmonary function testing, and many others, areexamples of periodic testing that might be required
Benefits: Non-compliance can lead to fines or even more serious sanc-
tions
Can be used to detect potential occupational illness or injury atan early and even reversible stage
Helps to prevent placing an “at-risk” individual in a potentiallyhazardous setting.
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DRUG TESTING
• Create and administer a very well-documented drug testing program (which includes employee signature of understand-ing and promise to comply).
• Testing Scenarios:– “Pre-placement”: as a condition of employment (may also be a
reg-ulatory requirement like DOT)
– “Post-incident”: Where an injury, or other event, occurs that issignificant enough to requirement medical treatment or results insignificant loss of or damage to company assets, a drug test isobtained
– “For cause”: Where measureable or observable behavior suggestsimpairment
– “Random”: Should be administered “across the board” not only forcertain groups, unless stipulated by regulatory mandate (DOT test-ing, for instance)
– “Pre-promotion”: As a condition of accepting a promotion
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DRUG TESTING, CONT.
Program requirements: Thoroughly documented policy that stipulates
Who is subject to the policy
Under what circumstances testing is applied
If testing does not apply to all employees, document why (DOT requirements forinstance)
Benefits/Rationale Word “gets around” about companies that don’t test
An applicant who fails a test even when testing is known to berequired is a problem averted
Some WC carriers offer premium discounts for drug testing pro-grams
Some industries mandate testing (avoid fines or other penalties)
Some states allow WC benefits to be denied when the event isshown to result from impairment as documented by a positive drugtest
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MAINTAINING A SAFE WORK ENVIRONMENT
Implement and enforce all regulatory and corporate safety
requirements.
Research the applicable Code of Federal Regulations (CFR) Sec-
tion(s) and ensure their full adherence
Research any other industry–specific regulatory guides and ensure
full adherence
Perform frequent work site walkthroughs to ensure compliance
with all industry-specific regulations as well as to detect any new
or persistent risks for injury or illness.
Benefits:
Prevention of occupational illnesses and injuries
Prevention of fines or other sanctions resulting from non-com-
pliance to regulatory requirements
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USE OF REQUIRED SAFETY EQUIPMENT
The use of required safety gear and practices, whether
mandated by the company or by industry regulation,
must be enforced.
Hearing protection, vision protection, respiratory protection,
“tie-offs”, steel-toed foot gear are just a few examples of such
equipment
Team-lifting, spotting, and work-breaks are just a few exam-
ples of safety practices that could be implemented
Failure to comply with these requirements must result
in well-documented progressive discipline
There is no excuse for a hearing loss claim where hearing pro-
tection is required and provided but not used!
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CONTROL - WHEN ILLNESSES AND INJURIES
OCCUR
Timely notification The ill or injured worker must notify the supervisor of the event with-
in 24 hours of its’ occurrence or becoming aware of symptoms.
The supervisor must notify the WC Leader immediately upon notifi-
cation by the worker.
The WC Leader has the best opportunity to effect a positive outcome
if information is available timely
The WC Leader, in association with the worker’s supervisor when
appropriate, should interview the worker and examine the place
where the illness or injury occurred
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OCCUPATIONAL HEALTH CARE AND RTW
• Direct the ill or injured worker to a previously ident-ified health care provider (where able)– Use a provider who is willing to communicate
– Use a provider who facilitates modified duty return to work
– Use a provider who can participate in the company’s post-incident drug testing program
• Use a document that the provider completes thatstipulates any limitations resulting from the illness orinjury in terms identical to those used in the positiondescriptions– Create a matrix of job physical demands. When new limits are
defined by the provider, refer to the matrix to identifytemporary alternative duty assignments
– Update the capabilities at least bi-weekly until the baseline isachieved or Maximum Medical Improvement (MMI) is reached.
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OCCUPATIONAL HEALTH CARE AND RTW,
CONT.
Be imaginative in creation of alternative duty
assignment opportunities: Where assignment to an existing job is not possible, consider
“making one up”
Where no kind of in-house assignment is possible, consider “loan-
ing” the worker to a not-for-profit like the American Red Cross,
American Heart Association, local Food Bank, etc.
Create a consortium of employers who have positions to which
workers can be assigned until they reach a level where they can be
assigned to an in-house alternative position, return to baseline or
achieve MMI
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LEARNING FROM MISTAKES
Carefully interview the ill or injured worker and any otherpersonnel who might be able to provide insight into theevent
When feasible perform a walkthrough of the area where theinjury or illness occurred Be sure that you comply with any safety requirements and
regulations while examining the worksite to ensure that you don’tbecome subject to the same type of problem.
Carefully document the illness or injury in order that trendscan be detected and aggressive preventive measures takenwhere appropriate. Note: Where the event occurred
What the worker was doing
Were safety measures being observed
Have others been injured doing the same thing in the same place
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LEARNING FROM MISTAKES, CONT.
Report all findings and recommendations to the appropr-
iate persons: Leadership, Safety staff, Supervisors, WC
Claims Processors, etc.
Apply progressive discipline if the worker became ill or
injured due to non-compliance with required safety
equipment, apparel, processes, etc.
Create and collaborate with a committee that can deter-
mine the best practice to prevent similar illness or injury
to other employees.
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OTHER MONEY-SAVING POSSIBILITIES
Consider becoming self-insured for WC and other P & C
coverages (be sure a stop-loss policy is in place)
If fully insured, consider high deductible to reduce impact of
small cases on your insured experience modification factor
Whether self or fully-insured, consider assuming the claims
administration function, using your carrier/payer’s system in
an “Application Service Provider” (ASP) setting, or a vendor’s
system
Either assume responsibility to administer all claims entirely or
assume only the medical-only claims (those where no indemnity
expenses are incurred
Aggressively monitor and negotiate case reserves
Medical-only claims should incur no or very little reserve
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OVERALL BENEFITS OF A HOLISTIC
APPROACH TO WC LOSS PREVENTION AND
CONTROL
Occupational healthcare costs for treatment of injuries andillnesses will be reduced due to fewer injuries
Fines and other regulatory body sanctions for non-compliance willbe avoided
Less injuries and illnesses lead to fewer claims; which lead toreduced administration fees from the workers’ compensationcarrier/payer
Aggressive RTW strategies reduce indemnity costs and reduce casereserves
Self-insurance (with stop loss) or higher deductible on fully-insuredplans will reduce premiums
Full or partial self-administration can dramatically reduce the costsof the WC program by reducing the administrative fees for claimshandling. Every claim handled and every bill paid incurs anadministrative fee
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