How Much You Pay Depends On the Next 3 Days

Transcription

1 How Much You Pay Depends On the Next 3 Days Presented by Mark Kraemer CIC, CSRM, CWCA 1

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6 Introducing Mark Kraemer Certified Work Comp Advisor (CWCA) Certified School Risk Manager (CSRM) Certified Insurance Counselor (CIC) Named to first agent advisory council for largest self-insured contractors work comp group Workers compensation speaker and educator for numerous local associations, training of physicians 6

7 Minnesota Comp Advisor Minnesota Comp Advisor assists school districts with controlling all of the variables that lead to better outcomes when dealing with Minnesota s complex workers compensation system Experience Mod Inclusion & Valuation of Losses for Experience Rating X X X O MOD X X X O MOD X = Policy Periods Included O = Not Included What occurs today affects the district for 3 years 7

8 Why is this so important? Payroll x rates = manual premium x experience mod = Final Premium 1.00 is average Cost of a Claim 2 Types of Claims: 1. Medical only 3 day waiting period/no lost time paid 2. Indemnity Employee loses 3+ days of work and lost wages must be paid Case Example 70% Rule Medical Only Claim = $2, Symbol 6 Cost of claim is reduced by 70% = $ Year Premium Cost = $1, day waiting period! Medical & Indemnity Claim = $2, $2,000 medical bills $ lost wages Symbol 5 No 70% reduction 3 Year Premium Cost = $6,

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10 Small Symbol 5 Claims are a Symptom of a Larger Problem If needless lost time is being prescribed on a regular basis, duration of claims will be much longer and outcomes much worse both for district and employee Impact on the Employee Injury Financial Impact (next slides) Lower Morale Fear Loss of Camaraderie Disability Syndrome 10

11 Financial Impact on Employee Per American Journal of public health: WC benefits replace 32-41% of pretax losses 40% reduced time on household work Lifetime losses cause financial catastrophe when work comp benefits have ceased American College of Occupational and Environmental Medicine Unnecessary prolonged work absence can cause needless, but significant harm to a person s well being. Many lose: Social relationships with co-workers Self respect from earning a living Major identity component : what they do for a living. American College of Occupational and Environmental Medicine Many key players do not fully realize the potential harm that prolonged medically excused time away from work can cause Many think time away allows for healing but do not consider that the worker s daily life has been disrupted. 11

12 American College of Occupational and Environmental Medicine.. Patients take on the sick role and dependent patient role. The sick role exempts them from their normal responsibilities while giving them the right to receive care from others free of fault. To recover, they must relinquish these roles. Those who have trouble coping with their circumstances are likely to resist relinquishing these roles. Journal of the American Medical Association Early intervention is key to preventing disability. Research confirms: People who never lose time from work have better outcomes than people who lose some time from work. Those receiving benefits recover slower and not as completely than those with the same medical conditions not receiving benefits. 12

13 Other Important Issues and Opportunities Valuation Date 6 months prior to renewal if no changes in renewal date Aggravated Inequity Rule Claim closes between valuation and renewal and reduction in actual paid generates a 5 point or greater difference in the mod Eliminate Small Loss Time Claims Reporting, Med Clinic, Challenge Workability Opportunities continued Subrogation Claims Bring action against a third party Ex Mod can get recalculated if your carrier collects Payrolls Check for 00 and 000s or matching payroll between 2 years Cost of Delayed Reporting 13

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19 Best Practices Establish communication with physicians Eliminate symbol 5 claims Implement 24/7 nurse hotline if available Train employees on costs and reporting Negotiate reserves PRIOR to valuation Review mod for errors Take advantage of Aggravated Inequity Rule Utilize loss control services to address problem areas (ex. salt shakers) Prepare for audit using list of excluded remunerations 19