Steps employers can take to increase their workers’ compensation costs

Some employers’ actions directly increase their worker’s compensation claims costs. Some of their actions also increase the workload of the claims examiner which results in an unappreciated direct impact on the claims results. Employer handling of safety, injury reporting, and personnel administration directly results in increased claims examiner turnover claim handling discontinuity, and increased claims costs.

Examples of employer actions which increase the claims examiners workload, and impair claims results are:

• When an employer hires an employee who is unqualified for the job, or physically not capable of performing the duties.
• When the employer does not have a culture of safety focused on preventing accidents.
• When the employer does not have good “house keeping” culture of providing a clean work environment. (this even applies to construction sites)
• When the employer does not have the latest video equipment to monitor retail spaces, distribution locations or other locations where mischief can take place.
• When the employer does not train the employee on the proper safety protocols.
• When the employer has not implemented a quality pre-placement physical process or does not have a pre-placement or post accident drug test policy.
• When an employer fails to immediately report all claims. (This is particularly true when the employer’s broker is used as an intermediary to report the claims.
• When the employer does not promptly use the appropriate designated medical facility to get the best quality care possible.(In some jurisdictions employers do not have medical control)
• When an employer fails to provide the necessary information needed to accurately determine compensability and calculate the correct benefit rates.
• When the employer delays the investigation process by not allowing the examiner to talk to the front-line supervisor or to any witnesses.
• When the employer does not provide an accurate job description of the physical requirements of the job to the claims examiner, the treating physician or the physical therapist.
• When the employer fails to provide light and/or modified duties.
• When the employer (front line supervisor, not the HR person) fails to maintain contact with injured worker who is off on disability.
• When an employer believes all claims are fraudulent, push for a broader/deeper investigation when the injury is clearly compensable.
• When a self-insured or risk sharing employer does not provide adequate or timely settlement authority.
• When an employer uses the workers’ compensation system in an effort to get rid of an employee.
• When the employer demands a resignation of employment in exchange for a lump sum settlement.

As with generic lists some of these items may not apply to all employers. However employers who perpetuate these actions usually have a higher x-mod and pay more for their workers compensation insurance.

Good brokers, underwriters and claims examiners educate their employer customers on how their actions can either increase or to reduce the claims frequency and severity.

This list in the right hands can help employers increase their productivity, employee engagement and manage workers compensation costs.