How a Sprawling Health System Slashed Injuries by 24 Percent

For Main Line Health's workers' comp team, reducing employee injuries meant ditching the adversarial approach and pivoting to advocacy claims management.
By: | October 30, 2018 • 6 min read

Soon after Steve Besack joined Main Line Health System’s workers’ compensation program in 2009, the human resources director at one of the suburban Philadelphia system’s hospitals invited him to lunch to discuss a nurse with 30 years’ tenure who had recently fractured her elbow.

“I thought, ‘Oh, no, what did I do wrong?’ ” he said.

Steven Besack, Corporate Director, Claims Management & Workers Compensation, Main Line Health

Nothing, as it turned out, and neither had the nurse. The nurse was offended though, by the idea that a nurse case manager escorted her to medical appointments as if she couldn’t be trusted to manage alone, said Besack.

“The human resources director said, ‘This is a great employee. Do we want to be the company who treats her like she’s guilty?’ That was the pivotal moment,” Besack said.

Until then, Besack was more familiar with the traditional workers’ compensation model, where companies default to an adversarial position against a presumption of fraudulent claims as an article of faith.

Breaking with the traditional model, he decided the department should be her advocate, not her adversary.

“There was no reason not to trust a nurse with 30 years of outstanding service,” he said. “That switch in culture changed everything.”

The pivot to the claims advocacy model, which operates on a premise of trust in injured workers and a dedication to returning them swiftly to health and work, introduced a period of organizational soul searching and a great deal of number crunching to determine how to make MLH a safer workplace with more engaged employees.

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A cascade of changes followed, earning Main Line Health System a 2018 Teddy Award.

These changes include an online reporting system that reduced reporting time by 82 percent, from 17 to three days, often capturing the sweet spot for treatment right after the injury that augurs well for full recovery. In one case, the nurse case manager scheduled treatment within seven minutes of a reported injury.

Culture of Safety

Mike Miller, manager, workers’ compensation and employee safety, focused on getting the best post-injury outcomes for the first several years after joining MLH in 2011. After researching other employers’ workers’ compensation best practices and studying Teddy Award winners’ stories, he concluded that post-loss was only half the problem.

Mike Miller, Manager, Workers’ Compensation and Employee Safety, Main Line Health

“Doing a great job on loss control wasn’t enough,” Miller said. “We needed to prevent injuries in the first place.”

At the same time he was contemplating a focus on safety, senior management authorized a dedicated safety position: employee safety specialist. This expense wouldn’t have earned the blessing from senior management without quantitative support, said Besack.

“We slice and dice the numbers every which way,” he said, and PMA presents them persuasively in exhaustive stewardship reports that can run upwards of 100 pages. MLH is “very data-driven” in its pursuit of safety, said Caroline Burhenne, regional claims service manager with PMA Management, MLH’s TPA.

“Are there falls in parking lots? Patient handling injuries? Needle sticks? At which facility? What shifts are involved?” she asked. “MLH goes to the incident reports for answers, and we can fix the problem quickly.”

Loss runs, incident reports, managed care savings, medical cost containment savings, liabilities — all those numbers tell the story about where money is going, and all of those numbers, presented to legal counsel and senior management, can earn their blessing for an unconventional, creative project, said Besack.

For example, to prevent injuries from happening in the first place, MLH recruited its own employees to identify workplace safety risks — tripping hazards from cables on floors, overhead objects that can produce head injuries, cracks in parking lots — so they could be resolved.

Employees who identify a hazard can report it. So far, a total of 15 “Employee Safety Messages,” with credit to the employee, have landed in almost 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Besack.

Although MLH pivoted for the “right reasons,” said Miller — to create a safer workplace and minimize distress and downtime after an injury — the changes produced considerable savings also.

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These included, said Besack, a 24 percent reduction in injuries severe enough to report to OSHA, workers’ compensation costs that held steady even as payroll increased 25 percent, a 36 percent decline in litigation and a $30,000 decrease in excess insurance premiums.

A number that particularly animates Besack might be seen as a bad thing at first glance, he said. That number: A 24 percent increase in “record only” cases thanks to enhanced claim reporting practices that capture the “near misses” — those incidents that fall below the severity threshold for OSHA reporting.

“We want to know about the near misses,” he said. “Every record-only case is another opportunity for loss prevention.”

Dear Worker: You Matter

There is a simple message behind the multi-front campaign towards greater employee engagement, trust and safety, said Miller: Employees are valuable. They’re valued before they’re injured, and they’re still valued after an injury.

MLH had its share of back and shoulder injuries from moving patients, said Burhenne. “Employees really are the biggest asset,” she said. “A lot of nurses have been in the industry for a long time, and they understand their jobs. Main Line Health doesn’t want to lose them.”

MLH provides “top-level customer service,” she said, including attentive but tactful nurse case management, fast medical treatment and the best doctors. PMA supports the effort. “They want to come back to work.”

“Caregivers’ primary focus was on patient safety, not their own safety. They didn’t buy it when we said, ‘Your safety is as important.’ To them, patients come first.” – Mike Miller, Manager, Workers’ Compensation and Employee Safety, Main Line Health

Injured employees also have “great messages about how to not get injured again,” said Miller. Those messages are effective in discouraging shortcuts — say, not bothering to use lifts or sliders when moving patients from beds to chairs — which can result in soft tissue injuries.

And repeat injuries, a red flag for offenders under the traditional model, have a lot to offer. When they looked at loss runs, Besack and Miller saw a small population with three or four patient handling injuries, which would have been a red flag under the traditional model.

“These people would have been seen as offenders,” said Miller.

“They cost the organization money.”

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They flipped that paradigm, sitting the employees down for face-to-face conversations, first reassuring them that they weren’t in trouble. “They had fantastic ideas about safety, but they were too intimidated to come forward,” he said. “When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability.”

Even though this feedback from peers contributed to their own safety, buy-in from the clinical staff wasn’t automatic.

“Caregivers’ primary focus was on patient safety, not their own safety. They didn’t buy it when we said, ‘Your safety is as important.’ To them, patients come first.”

Besack and Miller talked to their clinical staffs and located the missing part of the message: Injured caregivers aren’t much help to their patients. “Now we say, ‘Whatever you do to keep yourself safe helps your patients also,’ ” said Miller. “That message gets much more traction.” &

Susannah Levine writes about health care, education and technology. She can be reached at riskletters@lrp.com.

More from Risk & Insurance

More from Risk & Insurance

Insurtech

Kiss Your Annual Renewal Goodbye; On-Demand Insurance Challenges the Traditional Policy

Gig workers' unique insurance needs drive delivery of on-demand coverage.
By: | September 14, 2018 • 6 min read

The gig economy is growing. Nearly six million Americans, or 3.8 percent of the U.S. workforce, now have “contingent” work arrangements, with a further 10.6 million in categories such as independent contractors, on-call workers or temporary help agency staff and for-contract firms, often with well-known names such as Uber, Lyft and Airbnb.

Scott Walchek, founding chairman and CEO, Trōv

The number of Americans owning a drone is also increasing — one recent survey suggested as much as one in 12 of the population — sparking vigorous debate on how regulation should apply to where and when the devices operate.

Add to this other 21st century societal changes, such as consumers’ appetite for other electronic gadgets and the advent of autonomous vehicles. It’s clear that the cover offered by the annually renewable traditional insurance policy is often not fit for purpose. Helped by the sophistication of insurance technology, the response has been an expanding range of ‘on-demand’ covers.

The term ‘on-demand’ is open to various interpretations. For Scott Walchek, founding chairman and CEO of pioneering on-demand insurance platform Trōv, it’s about “giving people agency over the items they own and enabling them to turn on insurance cover whenever they want for whatever they want — often for just a single item.”

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“On-demand represents a whole new behavior and attitude towards insurance, which for years has very much been a case of ‘get it and forget it,’ ” said Walchek.

Trōv’s mobile app enables users to insure just a single item, such as a laptop, whenever they wish and to also select the period of cover required. When ready to buy insurance, they then snap a picture of the sales receipt or product code of the item they want covered.

Welcoming Trōv: A New On-Demand Arrival

While Walchek, who set up Trōv in 2012, stressed it’s a technology company and not an insurance company, it has attracted industry giants such as AXA and Munich Re as partners. Trōv began the U.S. roll-out of its on-demand personal property products this summer by launching in Arizona, having already established itself in Australia and the United Kingdom.

“Australia and the UK were great testing grounds, thanks to their single regulatory authorities,” said Walchek. “Trōv is already approved in 45 states, and we expect to complete the process in all by November.

“On-demand products have a particular appeal to millennials who love the idea of having control via their smart devices and have embraced the concept of an unbundling of experiences: 75 percent of our users are in the 18 to 35 age group.” – Scott Walchek, founding chairman and CEO, Trōv

“On-demand products have a particular appeal to millennials who love the idea of having control via their smart devices and have embraced the concept of an unbundling of experiences: 75 percent of our users are in the 18 to 35 age group,” he added.

“But a mass of tectonic societal shifts is also impacting older generations — on-demand cover fits the new ways in which they work, particularly the ‘untethered’ who aren’t always in the same workplace or using the same device. So we see on-demand going into societal lifestyle changes.”

Wooing Baby Boomers

In addition to its backing for Trōv, across the Atlantic, AXA has partnered with Insurtech start-up By Miles, launching a pay-as-you-go car insurance policy in the UK. The product is promoted as low-cost car insurance for drivers who travel no more than 140 miles per week, or 7,000 miles annually.

“Due to the growing need for these products, companies such as Marmalade — cover for learner drivers — and Cuvva — cover for part-time drivers — have also increased in popularity, and we expect to see more enter the market in the near future,” said AXA UK’s head of telematics, Katy Simpson.

Simpson confirmed that the new products’ initial appeal is to younger motorists, who are more regular users of new technology, while older drivers are warier about sharing too much personal information. However, she expects this to change as on-demand products become more prevalent.

“Looking at mileage-based insurance, such as By Miles specifically, it’s actually older generations who are most likely to save money, as the use of their vehicles tends to decline. Our job is therefore to not only create more customer-centric products but also highlight their benefits to everyone.”

Another Insurtech ready to partner with long-established names is New York-based Slice Labs, which in the UK is working with Legal & General to enter the homeshare insurance market, recently announcing that XL Catlin will use its insurance cloud services platform to create the world’s first on-demand cyber insurance solution.

“For our cyber product, we were looking for a partner on the fintech side, which dovetailed perfectly with what Slice was trying to do,” said John Coletti, head of XL Catlin’s cyber insurance team.

“The premise of selling cyber insurance to small businesses needs a platform such as that provided by Slice — we can get to customers in a discrete, seamless manner, and the partnership offers potential to open up other products.”

Slice Labs’ CEO Tim Attia added: “You can roll up on-demand cover in many different areas, ranging from contract workers to vacation rentals.

“The next leap forward will be provided by the new economy, which will create a range of new risks for on-demand insurance to respond to. McKinsey forecasts that by 2025, ecosystems will account for 30 percent of global premium revenue.

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“When you’re a start-up, you can innovate and question long-held assumptions, but you don’t have the scale that an insurer can provide,” said Attia. “Our platform works well in getting new products out to the market and is scalable.”

Slice Labs is now reviewing the emerging markets, which aren’t hampered by “old, outdated infrastructures,” and plans to test the water via a hackathon in southeast Asia.

Collaboration Vs Competition

Insurtech-insurer collaborations suggest that the industry noted the banking sector’s experience, which names the tech disruptors before deciding partnerships, made greater sense commercially.

“It’s an interesting correlation,” said Slice’s managing director for marketing, Emily Kosick.

“I believe the trend worth calling out is that the window for insurers to innovate is much shorter, thanks to the banking sector’s efforts to offer omni-channel banking, incorporating mobile devices and, more recently, intelligent assistants like Alexa for personal banking.

“Banks have bought into the value of these technology partnerships but had the benefit of consumer expectations changing slowly with them. This compares to insurers who are in an ever-increasing on-demand world where the risk is high for laggards to be left behind.”

As with fintechs in banking, Insurtechs initially focused on the retail segment, with 75 percent of business in personal lines and the remainder in the commercial segment.

“Banks have bought into the value of these technology partnerships but had the benefit of consumer expectations changing slowly with them. This compares to insurers who are in an ever-increasing on-demand world where the risk is high for laggards to be left behind.” — Emily Kosick, managing director, marketing, Slice

Those proportions may be set to change, with innovations such as digital commercial insurance brokerage Embroker’s recent launch of the first digital D&O liability insurance policy, designed for venture capital-backed tech start-ups and reinsured by Munich Re.

Embroker said coverage that formerly took weeks to obtain is now available instantly.

“We focus on three main issues in developing new digital business — what is the customer’s pain point, what is the expense ratio and does it lend itself to algorithmic underwriting?” said CEO Matt Miller. “Workers’ compensation is another obvious class of insurance that can benefit from this approach.”

Jason Griswold, co-founder and chief operating officer of Insurtech REIN, highlighted further opportunities: “I’d add a third category to personal and business lines and that’s business-to-business-to-consumer. It’s there we see the biggest opportunities for partnering with major ecosystems generating large numbers of insureds and also big volumes of data.”

For now, insurers are accommodating Insurtech disruption. Will that change?

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“Insurtechs have focused on products that regulators can understand easily and for which there is clear existing legislation, with consumer protection and insurer solvency the two issues of paramount importance,” noted Shawn Hanson, litigation partner at law firm Akin Gump.

“In time, we could see the disruptors partner with reinsurers rather than primary carriers. Another possibility is the likes of Amazon, Alphabet, Facebook and Apple, with their massive balance sheets, deciding to link up with a reinsurer,” he said.

“You can imagine one of them finding a good Insurtech and buying it, much as Amazon’s purchase of Whole Foods gave it entry into the retail sector.” &

Graham Buck is a UK-based writer and has contributed to Risk & Insurance® since 1998. He can be reached at riskletters.com.