Reduce Workers’ Comp Costs with In-House Services, Return Programs
EXECUTIVE SUMMARY
Workers’ compensation costs can be controlled with a robust risk management program. A comprehensive return-to-work program is essential.
- Needlestick injuries are frequent but do not often lead to disease.
- Healthcare employers can use their own services for physical therapy and other expenses.
- Safety training should target specific hazards.
Controlling workers’ compensation costs is challenging for any employer, and healthcare employers face difficult work-related situations. Paying attention to some of the most common and costliest risks can help manage the financial effects.
As many hospitals have a large deductible, or self-insure their workers’ compensation exposure, the largest expense typically is their actual losses, notes Joe Levy, senior vice president with Risk Strategies, a consulting firm in Philadelphia.
This creates significant opportunities for a hospital that develops and manages a robust risk management program, he notes. The hospital can reduce its expenses by preventing and reducing claims through creating a culture of safety, implementing robust risk control initiatives, and using a proactive claims-handling program aimed at minimizing an injured worker’s time out of work, he says.
“Some of the most successful programs implemented by hospitals to reduce injuries and the resultant costs include management leadership and support, consistent education and training, safe lifting techniques, accident investigation/injury review processes, and a transitional return-to-work program,” Levy explains.
A transitional return-to-work program should include contact by the hospital’s designated claims staff and/or management designee to express compassion and encourage recovery, Levy says. The goal should be 100% of injured employees returning to light duty at the first opportunity, including a light duty list of functional work tasks.
“With a program that has the commitment of leadership, the right champions internally, and accountability, you can really drive down expense, and all that flows to the bottom line,” Levy says. “If you have a hospital that averages $1 million a year in claims and you can cut 20% to 50% of that, that’s $200,000 or $500,000 that now is found money. Ideally, you could reinvest some of that back into the program to improve the results even more.”
Top Three Injuries
The top three categories of injuries in healthcare are musculoskeletal/ergonomic injury, slip/trip/fall, and needlestick injuries, both in frequency and severity, says Audrey Allsopp, claims consultant and the national workers’ compensation practice leader at Conner Strong & Buckelew, a risk management, insurance, and employee benefits broker in Camden, NJ.
“While needlestick injuries can be frequent, they are not usually high-cost items unless they convert to disease, which is, thankfully, relatively rare. For this reason, we regularly focus on how to decrease the frequency of the first two: musculoskeletal/ergonomic and slip/trip/fall injuries,” Allsopp says. “With each of these, targeted, deliberate programs have the biggest impact. Information and training are essential in fostering change, but just tossing out some information on a flyer or in an occasional training rarely get any long-term traction and results. A more deliberate training program is needed.”
Medical and indemnity costs resulting from musculoskeletal/ergonomic injuries, including urgent care, diagnostic, physical therapy, and surgery, can be significant, Allsopp says. Many of these injuries are affected by comorbidities, age, physical activity, health, partnership with the specialist’s community, availability of transitional work programs, and engaged partnership with the hospital workforce.
Needlestick Protocols Needed
Although needlestick injuries do not always result in infection, they must be addressed carefully with a comprehensive program, says Melissa Zaslow Burke, PharmD, vice president at AmTrust Financial Services in Southington, CT. Create protocols to ensure employees can be provided immediately with the necessary medications when a needlestick is reported, she says.
“This will require prior arrangements with your insurance carrier to allow the provision of those medications without any delay caused by prior authorization requirements or other limitations,” she says. “We also want to ensure the employee feels supported and understands the process and expectations that go with that workers’ comp injury.”
Burke encourages risk managers to stay current with new technology and techniques to reduce needlestick injuries. It also is important to support the employee to reduce anxiety.
“We know that worry and anxiety can lead to elements that increase the cost of a claim, like obtaining representation,” Burke says. “It’s important to have protocols in place prior to needlestick injuries occurring that address not only the clinical needs but also the kind of emotional support these employees will need to get through the experience in the best way.”
Use Your Own Services
Hospitals can lower medical costs through existing structure such as providing first aid, urgent care, surgery, diagnostics, physical therapy, and other on-site medical treatment, Allsopp says.
“Hospitals should partner with their claim processing partner to re-price medical bills to workers’ compensation-allowed charges,” Allsopp says. “The hospital is able to control medical and offer the best care to their employees by utilizing internal resources and write off medical cost at state-allowed charges.”
Safety training programs should bring all parts of the organization to bear on the specific issue, she says. For example, one hospital system she worked with created a slip/trip/fall program that focused on recognizing and abating specific hazards across the hospital facilities. Since most of these hazards can be resolved quickly on the spot, the goal of the program was to develop and foster a culture where all employees think “If You See Something, Do Something” regarding slip/trip/fall incidents.
“The program revolved around training all employees about how to recognize slip/trip/fall hazards, reporting them at daily safety huddles, and providing incentives and tight accountabilities for abating the hazards once reported,” she explains. “With every employee on the lookout for issues and systems to eliminate them, the facility has the best chance of abating this extremely common and often costly category of injuries. This approach is vastly different than just putting out a flyer of information, and vastly more effective.”
Wellness programs that help mitigate comorbidities, such as diabetes, smoking cessation, weight, and stress management, allow employees to heal and recover faster, Allsopp says. The programs also allow employees to pursue surgery at the time prescribed rather than wait for the completion of a wellness program, which could take six months to a year, she says.
Engaged relationships with the medical specialty community such as orthopedics, neurology, and other specialists help the team understand the type of transitional work availability, Allsopp says. Invite the specialist to tour the hospital so the specialist can view the jobs, see how the job is performed, and write restrictions accordingly, she advises. The specialist can see ergonomic risk factors or controls the hospital has implemented to combat these risk factors.
“Identify transitional duty jobs prior to the work injury through engagement with insurance, risk management, risk control, operations, human resources, physical therapists, legal, and the medical director ensures minimal down time for the employee, keeps the employee connected to the workplace, and fosters the healing process,” she adds.
Tried-and-true workers’ comp methods are the best avenues for minimizing costs, Allsopp says. Such methods include good incident investigation and reporting; quick, quality medical care from healthcare professionals who genuinely understand workers’ compensation issues; strong and appropriate follow-up with the employee; and good return to work policies and procedures, she says.
“Engaging the hospital medical director in the claims management process is key. The medical director can oversee the medical treatment on- and off-site, assign and review restrictions, demonstrate to the employee how to perform the job duties within the restrictions, share their medical expertise in the claim review process, and build relationships with the specialist community,” she says. “The common denominator among prevention, remediation, and cost/claim management is engaged, focused, deliberate, systems-oriented actions and relationships.”
SOURCES
- Audrey Allsopp, Claims Consultant, Conner Strong & Buckelew, Camden, NJ. Phone: (877) 861-3220.
- Melissa Zaslow Burke, PharmD, Vice President, AmTrust Financial Services, Southington, CT.
- Joe Levy, Senior Vice President, Risk Strategies, Philadelphia. Phone: (800) 508-1355.
Controlling workers’ compensation costs is challenging for any employer, and healthcare employers face difficult work-related situations. Paying attention to some of the most common and costliest risks can help manage the financial effects.
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