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2017 Teddy Awards: Honorable Mention

Triage, Transparency and Teamwork

When the City of Surprise, Ariz. got proactive about reining in its claims, it also took steps to get employees engaged in making things better for everyone.
By: | November 1, 2017 • 5 min read

Facing the painful medical cost increases that bedevil so many administrators, the City of Surprise, Arizona, significantly cut its medical expenditures and lost work days by implementing new programs and moving to a self-insured model.

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Historically, Surprise was a member of a municipal risk pool that offered a guaranteed-cost program for workers’ compensation. The program served its purpose for the 15 years Surprise was a member, limiting potential exposure by capping aggregate losses. However, costs and premiums were rising.

When Brian Carmichael assumed the role of risk manager in May 2015, he identified a growing interest in the possibility of self-insurance. In the process, the city conducted a thorough analysis of workers’ compensation and found there was “money being left on the table” in premiums and medical costs. Carmichael’s team began prioritizing changes that needed to be made.

Taking Control With Triage

Carmichael noted that Surprise’s workers’ comp medical expenses, at around $800,000, were far more than they should have been for a city of its size. But the best path for a solution wasn’t immediately clear. The risk management team chose to approach the problem at a grass roots level, enlisting the help of employees to talk about their injury experiences.

Through those conversations, the team noted that the city was relying solely on supervisors to triage or direct care to various medical providers in the event of an injury. With no medical training, supervisors often erred on the side of caution and sent injured workers to the emergency room, sometimes for things as minor as a small cut or sprained ankle.

This resulted in frustratingly long wait times for employees and also high costs for the city.

Brian Carmichael, risk manager, City of Surprise, Ariz.

Carmichael’s team recognized the need for skilled medical triage and decided to search for an appropriate partner. It selected a local company to contract with.

A detailed, in-person training session was given to each department on the new procedure and how it would impact the injury and recovery process. Carmichael said the program evolved over the first few months.

The new procedures allowed the city to gain more control over its claims, including protocols for sending reports and email notifications to all stakeholders during an injury.

The risk management department, including senior adjuster Bretton Jeziorski and adjuster and safety analyst Michelle Boyer, immediately reach out to each injured worker to start investigating and expediting medical care.

“We are all notified within 15 minutes of [an injury], which allows us to reach out directly to them. I think that has been the biggest win for us to have that immediate intervention with our employees,” Carmichael said.

The ability to begin the investigation process sooner is also helping the city to eliminate repeat injuries, driving claims frequency down.

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An increase in transparency about claims costs allows risk management to engage everyone in its push to prevent injuries and improve claims outcomes.

“Being able to show what we are paying and going to departments — from city leadership down to line-level employees — created a culture in which everyone was interested,” he said.

Carmichael said the city saw an “immediate shift” in the entity’s ability to contain costs, dramatically reducing the number of hospital bills that formerly might linger for months before risk management even knew about them.

Between 2015 and 2016, visits to the ER fell by half. Yearly average claim costs fell from $6,584 to $4,220, and workers were receiving better care.

The city also significantly reduced lost workdays by expanding opportunities for return to work. Many employees appreciate having the ability to return to light duty roles at full compensation.

“Oftentimes these employees would go to the ER, never do a follow-up, take a month off from work and just disappear. There were holes in the program,” Carmichael said.

While the City of Surprise lost 572 workdays in 2015, the risk management department was able to reduce that number to only 211 days in 2016.

Inspiring Engagement

Carmichael said that using its new transparency about costs has allowed employees to really see how their participation matters, and to take an active interest in continued improvement. “Their cooperation hasn’t been about compliance but about commitment,” he said.

Numerous suggestions offered by employees in regards to process improvement and tool and equipment modifications have been put into place throughout the City in the past year. To keep that momentum alive, Carmichael said the department speaks to all 1,200 full- and part-time city workers at least every other month.

“Oftentimes employees would go to the ER, never do a follow-up, take a month off from work and just disappear. There were holes in the program.” — Brian Carmichael, risk manager, City of Surprise, Ariz.

The program became so successful the city made the leap to becoming self-insured on July 1, 2017. Whereas most similar programs are administered through a TPA, the City of Surprise has opted to self administer. Carmichael said the team wanted to further contain medical costs by going directly to providers and cutting out any markups in the middle.

Carmichael said this decision has enabled them to negotiate some “unbelievable” rates.

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The city is still protected against catastrophic injuries with a self-insured retention of $500,000 for the general population and $1 million for public safety employees. Surprise also established appropriate reserves that would be three times those limits.

“We’re going to build that and invest the money over the years to reduce the program cost to the employees while still keeping those dollars low,” he said.

Through all these measures, Carmichael said Surprise has been able to reduce workers’ compensation medical expenditures from an average of $800,000 to only $300,000 in two years. And from July to October 2017, there was not a single lost workday.

“We have the buy-in from the employees that it’s in their best interest. They’re being paid. It’s a benefit. If they can be here in some way, they come,” he said. &

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More coverage of the 2017 Teddy Award Winners and Honorable Mentions:

Advocacy Takes Off: At Delta Air Lines, putting employees first is the right thing to do, for employees and employer alike.

 

Proactive Approach to Employee SafetyThe Valley Health System shifted its philosophy on workers’ compensation, putting employee and patient safety at the forefront.

 

Getting It Right: Better coordination of workers’ compensation risk management spelled success for the Massachusetts Port Authority.

 

Carrots: Not SticksAt Rochester Regional Health, the workers’ comp and safety team champion employee engagement and positive reinforcement.

 

Fit for Duty: Recognizing parallels between athletes and public safety officials, the city of Denver made tailored fitness training part of its safety plan.

 

Triage, Transparency and TeamworkWhen the City of Surprise, Ariz. got proactive about reining in its claims, it also took steps to get employees engaged in making things better for everyone.

A Lesson in Leadership: Shared responsibility, data analysis and a commitment to employees are the hallmarks of Benco Dental’s workers’ comp program.

 

Craig Guillot is a writer and photographer, based in New Orleans. He can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

The Profession

Curt Gross

This director of risk management sees cyber, IP and reputation risks as evolving threats, but more formal education may make emerging risk professionals better prepared.
By: | June 1, 2018 • 4 min read

R&I: What was your first job?

My first non-professional job was working at Burger King in high school. I learned some valuable life lessons there.

R&I: How did you come to work in risk management?

After taking some accounting classes in high school, I originally thought I wanted to be an accountant. After working on a few Widgets Inc. projects in college, I figured out that wasn’t what I really wanted to do. Risk management found me. The rest is history. Looking back, I am pleased with how things worked out.

R&I: What is the risk management community doing right?

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I think we do a nice job on post graduate education. I think the ARM and CPCU designations give credibility to the profession. Plus, formal college risk management degrees are becoming more popular these days. I know The University of Akron just launched a new risk management bachelor’s program in the fall of 2017 within the business school.

R&I: What could the risk management community be doing a better job of?

I think we could do a better job with streamlining certificates of insurance or, better yet, evaluating if they are even necessary. It just seems to me that there is a significant amount of time and expense around generating certificates. There has to be a more efficient way.

R&I: What was the best location and year for the RIMS conference and why?

Selfishly, I prefer a destination with a direct flight when possible. RIMS does a nice job of selecting various locations throughout the country. It is a big job to successfully pull off a conference of that size.

Curt Gross, Director of Risk Management, Parker Hannifin Corp.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

Definitely the change in nontraditional property & casualty exposures such as intellectual property and reputational risk. Those exposures existed way back when but in different ways. As computer networks become more and more connected and news travels at a more rapid pace, it just amplifies these types of exposures. Sometimes we have to think like the perpetrator, which can be difficult to do.

R&I: What emerging commercial risk most concerns you?

I hate to sound cliché — it’s quite the buzz these days — but I would have to say cyber. It’s such a complex risk involving nontraditional players and motives. Definitely a challenging exposure to get your arms around. Unfortunately, I don’t think we’ll really know the true exposure until there is more claim development.

R&I: What insurance carrier do you have the highest opinion of?

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Our captive insurance company. I’ve been fortunate to work for several companies with a captive, each one with a different operating objective. I view a captive as an essential tool for a successful risk management program.

R&I: Who is your mentor and why?

I can’t point to just one. I have and continue to be lucky to work for really good managers throughout my career. Each one has taken the time and interest to develop me as a professional. I certainly haven’t arrived yet and welcome feedback to continue to try to be the best I can be every day.

R&I: What have you accomplished that you are proudest of?

I would like to think I have and continue to bring meaningful value to my company. However, I would have to say my family is my proudest accomplishment.

R&I: What is your favorite book or movie?

Favorite movie is definitely “Good Will Hunting.”

R&I: What’s the best restaurant you’ve ever eaten at?

Tough question to narrow down. If my wife ran a restaurant, it would be hers. We try to have dinner as a family as much as possible. If I had to pick one restaurant though, I would say Fire Food & Drink in Cleveland, Ohio. Chef Katz is a culinary genius.

R&I: What is the most unusual/interesting place you have ever visited?

The Grand Canyon. It is just so vast. A close second is Stonehenge.

R&I: What is the riskiest activity you ever engaged in?

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A few, actually. Up until a few years ago, I owned a sport bike (motorcycle). Of course, I wore the proper gear, took a safety course and read a motorcycle safety book. Also, I have taken a few laps in a NASCAR [race car] around Daytona International Speedway at 180 mph. Most recently, trying to ride my daughter’s skateboard.

R&I: If the world has a modern hero, who is it and why?

The Dalai Lama. A world full of compassion, tolerance and patience and free of discrimination, racism and violence, while perhaps idealistic, sounds like a wonderful place to me.

R&I: What about this work do you find the most fulfilling or rewarding?

I really enjoy the company I work for and my role, because I get the opportunity to work with various functions. For example, while mostly finance, I get to interact with legal, human resources, employee health and safety, to name a few.

R&I: What do your friends and family think you do?

I asked my son. He said, “Risk management and insurance.” (He’s had the benefit of bring-your-kid-to-work day.)

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]