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Claims Management

Payers Benefit From Newer Claims Technology

The shift from legacy to cloud-based systems is unlocking new benefits and new possibilities for employers and other claims payers.
By: | March 7, 2017 • 5 min read

The retirement of baby-boomer age computer professionals is helping drive more workers’ comp claims payers to abandon older, legacy-type claims management systems for nimbler software as a service (SaaS) technology.

The shift is occurring as the aging computer professionals, along with claims adjusters who spent their careers working with the assistance of the older legacy claims systems, are replaced by millennials accustomed to newer, smarter technology.

Tim Davidson, director of return to work solutions, Riskonnect

“The people who have been maintaining these legacy systems, as well as your adjusters who are used to using those systems, are getting older and exiting the business,” observed Shahin Hatamian of Mitchell International Inc. “You are bringing in younger people who don’t know how to use that legacy system and they want something that is easier to use, more configurable, and a little more automated. That is where newer systems come into play.”

The newer technology also accommodates a younger, less-experienced adjuster workforce with automation that eliminates more of their decision making.

Several other equally pressing reasons are pushing claims payers to continue a migration away from legacy systems to SaaS platforms. For one, more services now developed to improve workers’ compensation claims outcomes are created on these platforms, allowing for easier data interchange between claims payers’ systems and other services the claims payer uses.

“You would be hard pressed to not want to take advantage of the benefits of SaaS,” Hatamian said.

Legacy systems typically rely on in-house server technology for information storage and often were developed to meet a specific company’s needs. Their ongoing use, modification and maintenance usually requires the expertise of people familiar with that system.

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“There are a group of legacy systems that have more attractive, contemporary user interfaces, but they are still built on architectures that are fairly rigid and require a lot of custom coding,” said Aaron Shapiro, executive director of sales, marketing and legal at Origami Risk.

By contrast, SaaS systems are cloud based and accessed via a web browser. While much of their updating can be done simultaneously for many customers, they also allow ease in customization, according to proponents.

“From a claims management standpoint there are so many moving variables at any point in time. … There are a plethora of people involved in the whole claims process.” — Tim Davidson, director of return to work solutions, Riskonnect

The newer technology’s flexibility allows easier configuration to meet a purchaser’s unique workflows, rather than requiring the purchaser to flex their operations around the technology, Shapiro added. It can ease risk managers’ connection with other company departments, such as safety, and with their company’s operations managers for quicker action on data revealing workers’ comp claim drivers.

“That leads to much higher engagement in the operational field,” Shapiro elaborated.  “Where you have a risk manager that has a collaborative relation with field operations and safety there is an opportunity to automatically trigger workflows the second there is a report of injury.”

Shahin Hatamian, Vice President, Product Management and Strategy, Mitchell International Inc.

Similarly, information can be more easily shared with outside parties such as third party administrators, nurse case managers and other workers’ comp service vendors relaying information that may prevent a claim from growing more expensive.

“That is what SaaS products do,” said Nicholas Toal, vice president of business development and sales at JW Software. “It’s a solution that tries to make the workflow seamless,” eliminating challenges claims payers frequently encounter when attempting to connect older systems with third party claims services.

Factors driving the shift away from legacy systems to SaaS also include ease in updating the newer systems with state regulatory changes and less disruption when employees leave a company employing the technology, said Tim Davidson, director of return to work solutions at Riskonnect.

The most pressing reason for moving to SaaS, though, is the ability to connect with many sources of information — including industry trends and service provider data — impacting a claim, Davidson said.

“From a claims management standpoint there are so many moving variables at any point in time,” he elaborated. “It is not just the injured employee or employer. You are dealing with medical providers, you are dealing with bill review, you are dealing with nurse case managers, independent medical examiners. There are a plethora of people involved in the whole claims process.”

Multiple Benefits

Improved integration of information from all those sources can help adjusters and other end users make better decisions, Davidson said.

Tom Ryan, market research leader, Marsh’s Workers Compensation Center of Excellence

Meanwhile, newer technology companies have emerged offering risk management information systems with “a broader platform of service capabilities,” said Tom Ryan, market research leader at Marsh’s Workers Compensation Center of Excellence. Those capabilities include data analytics and the conversion of data into highly customized reports and dashboards for workers’ comp claims management.

Simultaneously, employers are increasingly knowledgeable about the data management capabilities of risk management information systems, Ryan added.

“So a lot of employers are looking for more customized dashboards and tools to manage workers’ compensation,” Ryan said.

RMIS systems, and their dashboard technology for managing claims, have improved significantly over the past two to three years, added Duane Pifer, senior consultant and data analytics lead in the integrated casualty consulting group at Willis Towers Watson.

But the systems typically provide relatively stagnant information, Pifer added. Employers and other claims payers could benefit, he said, should the next generation of technology products allow claims payers to receive more interactive claims information delivered in smaller, more frequent, notifications, like those that social media sites push out concerning a user’s network contacts.

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In that way alerts pushed-out to cell phones or tablets, for example, could inform employers of organizational changes — such as increased employee turnover in a specific production unit — that would likely impact claim filings, Pifer said.

Similarly, information could alert claims payers when claims are nearing a certain status point, such as a specific expense level.

“It is that kind of information, in small chunks, that Is intuitive that the user wants to see,” Pifer said. “I think the technology is beginning to get there and I know some RMIS have apps that provide that. But it is not widespread yet.”

When it comes to both RMIS and claims management systems, however, there is widespread agreement that the newer platforms are much simpler to use.

Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

More from Risk & Insurance

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Risk Management

The Profession

The risk manager for Boyd Gaming Corp. says curiosity keeps him engaged, and continual education will be the key to managing emerging risks.
By: | May 1, 2018 • 4 min read

R&I: What was your first job?

I was trained as an accountant, worked in public accounting and became a CPA. Being comfortable with numbers is helpful in my current role, and obviously, the language of business is financial statements, so it helps.

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

Working in finance in the corporate environment included the review of budgets and the analysis of business expenses. I quickly found the area of benefits and insurance — and how “accepting risk” impacted those expenses — to be fascinating. I asked a lot of questions. Be careful what you ask for — I soon found myself responsible for those insurance areas and haven’t looked back!

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

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I have found the risk management community to be a close-knit group, whether that’s industry professionals, risk managers with other companies or support organizations like RIMS and other regional groups. The expertise of the carriers and specialty vendors to develop new products and programs, along with the appropriate education, will continue to be of key importance to companies going forward.

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

As I’m sure many in the insurance field would agree, Hurricanes Katrina and Rita in 2005 changed our world and our industry. It was a particularly intense time and certainly a baptism by fire for people like me who were relatively new to the industry. This event clearly accelerated the switch to the acceptance of more risk, which impacted mitigation strategies and programs.

Bob Berglund, vice president, benefits and insurance, Boyd Gaming Corp.

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

The fast-paced threat that cyber security represents today. Our company, like so many companies, is reliant upon computers, software and IT expertise in our everyday existence. This new risk has forged an even stronger relationship between risk management and our IT department as we work together to address this growing threat.

Additionally, the shooting event in Las Vegas in 2017 will have an enduring impact on firms that host large gatherings and arena-style events all over the world, and our company is no exception.

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

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With the various types of insurance programs we employ, I have been fortunate to work with most of the large national and international carriers — all of whom employ talented people with a vast array of resources.

R&I:  How much business do you do direct versus going through a broker?

We use brokers for many of our professional coverages, such as property, casualty, D&O and cyber. We are self-insured under our health plans, with close to 25,000 members. We tend to manage those programs internally and utilize direct relationships with carriers and specialty vendors to tailor a plan that works best for team members.

R&I: Who is your mentor and why?

I have been fortunate to have worked alongside some smart and insightful people during my career. A key piece of advice, said in many different ways, has served me well. Simply stated: “Seek to understand before being understood.”

What this has meant to me is try everything you can to learn about something, new or old. After you have gained this knowledge, you can begin to access and maybe suggest changes or adjustments. Being curious has always been a personal enjoyment for me in business, and I have found people are more than willing to lend a hand, offer information and advice — you just need to ask. Building those alliances and foundations of knowledge on a subject matter makes tackling the future more exciting and fruitful.

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

Our benefit health plan is much more than handing out an insurance card at the beginning of the year. We encourage our team members and their families to learn about their personal health, get engaged in a variety of health and wellness programs and try to live life in the healthiest possible way. The result of that is literally hundreds of testimonials from our members every year on how they have lost weight, changed their lifestyle and gotten off medications. It is extremely rewarding and is a testament to [our] close-knit corporate culture.

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

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Some will remember the volcano eruption in Iceland in spring of 2010. I was just finishing a week of meetings in London with Lloyd’s syndicates related to our property insurance placement when the airspace in England and most of northern Europe was shut down — no airplanes in or out! Flights were ultimately canceled for the following five days. Therefore, with a few other stranded visitors like myself, we experimented and tried out new restaurants every day until we could leave. It was a very interesting time!

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

I am originally from Canada, and I played ice hockey from the time I was four years old up until quite recently. Too many surgeries sadly forced my recent retirement.

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

That’s a funny one … I am a CPA working in the casino industry, doing insurance and risk management, so neighbors and acquaintances think I either do tax returns or they think I’m a blackjack dealer at the casino!




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