Employers frequently misunderstand
how workers’ compensation should be
applied in various situations. Work-place-related incidents occur daily that are
of varying degrees of severity.
Smart Business spoke with David Weir,
president of UPMC Work Partners, about
the importance of employer familiarity
with workers’ compensation and its impact
on every level of the workplace.
What workers qualify for compensation?
Workers’ compensation is a state-mandated benefit that compensates a staff
member who suffers a work-related injury
or occupational illness.
The program was established to reimburse injured workers for lost wages and
reasonable medical expenses that are a
result of an occupational injury or illness.
‘Reasonable medical expenses’ typically
means all costs related to an employee’s
medical care such as doctor visits, X-rays,
physical therapy and medications.
In Pennsylvania, employers must provide
coverage for all employees, including seasonal and part-time.
What can an employer do to manage the cost
of workers’ compensation premiums?
This can become complicated, particularly when a case is in litigation or complex
medical issues are involved. Several basic
elements comprise all well-managed programs.
- A solid loss prevention and safety program potentially can reduce the number of
workers’ compensation cases. It can get
tricky, but if you can keep employees from
getting hurt, it is a great first step. - Access to prompt quality care when
an injury/illness occurs is critical. The key
here is to establish medical panels with
physicians/medical providers that have
experience in the types of injuries or illness
that you expect to occur. You should also
cover the geographical area of your
employees, and have an understanding of
workers’ compensation laws, along with
your company’s return-to-work policies
and practices. It is important that these providers communicate with the people
managing the claims. - A structured transitional or return-to-work (RTW) policy enables the injured
worker to remain in a temporary job assignment while recovering from the injury.
In developing an RTW program or transitional work policy, it is recommended that
you consult legal or vocational experts.
What cost-containment tools are available?
An employer can utilize a variety of tools
to minimize his or her costs while still providing excellent coverage for employees.
One key tool is establishing a customized
physician panel that can accommodate the
type of work-related illnesses and injuries
that an employer can anticipate occurring
in the workplace. Under Pennsylvania law,
the employee must obtain treatment from
one of the physicians on the panel for the
first 90 days. This arrangement ensures the
employee has prompt access to medical
care, minimizes time lost from work and
provides preferential pricing.
Other tools include making a transitional/modified work assignment available to
the injured employee, and utilizing strong
pharmacy, physical therapy and diagnostic
network programs.
What should an employer know about managing claims?
An important element is to use a professionally trained and experienced claims
adjustor/examiner. That person needs to
have a reasonable case load — about 120
to 150 files. The adjustor needs an adequate support staff and a user-friendly technological system to effectively manage
those files. Otherwise, what you are doing
is processing claims, not managing those
claims. Effectively managing claims can
take weeks off the amount of time a claim
stays open and can save an employer
wages and/or medical dollars.
Many employers choose to have their
workers’ compensation claims managed
by an outside party that can oversee the
entire operation.
Often, the outside party will use a team
approach. The team should include claims
examiners, claims technicians, nurse case
managers, vocational specialists and others. But what everyone should understand
is that the most important person on the
team is the employee. Keeping the employee motivated and cooperative is essential
in speeding recovery.
We like to call managing claims an art
form. You need the right tools, you need
the right experience and you need to be
able to recognize its true costs.
How do you know if your workers’ compensation claims are being effectively managed?
To successfully manage workers’ compensation, you have to measure your program’s performance. If you can’t measure
it, you can’t manage it. That’s as true of
workers’ compensation as it is in other
areas of business. You need to know what
you are paying this year versus last year,
the frequency of claims, the total number
of lost days and the total lost production.
Effectively measuring the program can
identify trends, focus prevention and help
create accountability for low-performing
areas.
DAVID WEIR is president of UPMC Work Partners in Pittsburgh.
Reach him at (412) 454-8720 or [email protected].