2016 Teddy Award Winner

The Road to Success

Accountability and collaboration turned Hampton Roads Transit’s legacy workers’ compensation program into a triumph.
By: | November 2, 2016 • 5 min read

In four years, Hampton Roads Transit transformed a legacy workers’ compensation program that was costly and ineffective into a phenomenal success.

From 2011 to 2015, HRT saw a 98 percent decrease in lost-time claims frequency, 94 percent decrease in average number of days lost per lost-time claim, 48 percent decrease in frequency of injuries and 78 percent decrease in total incurred costs per claim.

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Its savings from the total amount billed in 2015 alone was 40 percent lower than the prior year, while the average claims reporting time was reduced to 3.7 days, compared to 5.7 days in 2014.

Under the leadership of Kimberly Ackerman, chief human resources officer, and Danielle Hill, human resources compliance manager, the public transportation agency took a program that did not track claims or spending and created a collaborative organization that has achieved impressive results.

“Accountability. Teamwork. Customer Service.” Those are the hallmarks of the program, Hill said.

“The biggest goal for us,” adds Ackerman, “was to be collaborative, to have a high degree of accountability and to have managers and employees alike understand and embrace the program.”

She praised Hill for leading the effort.

Kimberly Ackerman, chief human resources officer, Hampton Roads Transit

Kimberly Ackerman, chief human resources officer, Hampton Roads Transit

“She has brought a fresh new perspective to the program, innovative strategies and a high degree of collaboration with employees and managers,” Ackerman said.

The transformation began with a formal review of HRT’s past program. Hill said the 1,000-employee transit agency “never tracked anything. We never knew how much money was spent.”

In 2012, Hampton Roads Transit brought in new management to regain public confidence in its operation of 56 bus routes and 11 light rail lines in southeast Virginia. In furtherance of that mission, HRT partnered with PMA Management Corp. to help contain costs for the self-insured workers’ compensation program.

“What they wanted to do was get a grip on the claims they had and change the culture around the workers’ compensation program,” said Brad Wilson, account executive for PMA, the third-party administrator.

A review discovered that workers’ comp claims costs had nearly doubled each year during the prior three years. The average number of days lost per lost-time claim in 2011 was 207, which created logistical nightmares for the regional transit organization. (It was 12 in 2015.)

All Working Toward the Same Goal

Once HRT had a handle on its past experience, the biggest challenge was “making sure we are all working toward the same goal,” Hill said. “Getting everybody on the same page is really hard to do. I think our biggest goal when we took over was our customer service. Making sure staff understood that our employees are actually our customers.”

HRT wanted to make it easier for employees to file workers’ comp claims. They wanted to decrease claims. They wanted to keep their workers healthy and safe. The key was creating a 360-degree employee safety and training program.

It’s the heart of HRT’s loss control strategies.

“Everybody respects the program. We are all on the same side, working on the same goal.” — Danielle Hill, human resources compliance manager, Hampton Roads Transit

Bus drivers are enrolled in an 8-week training class that includes classroom and simulation exercises, as well as test runs.

Employee orientation sessions train employees on what to do if they are injured, how to report an injury and how to prevent injuries. There are regular safety talks and post-accident safety training for drivers and maintenance workers.

The 360-degree program also includes intranet-based safety training, annual refresher training, annual safety awards and wellness programs for employees. The HR department is currently working with physical therapists on their workers’ compensation panel to create posters and safety videos to display in drivers’ lounges.

The program has a multi-tier safety structure that starts with monthly safety committee meetings that include at least one bus driver representative to address safety issues. When injuries occur, the committee members discuss how HRT could have prevented the incident.

Hill said the team regularly inspects the facilities and equipment.

An upper level operational safety and security committee deals with issues that can’t be addressed at the lower level, and a senior executive team targets strategic issues.

On a quarterly basis, HRT reviews the top five injuries for the prior three months and develops training sessions if it sees any recurring problems.

Changing the culture from one with little accountability and few formalized processes was a challenge.

Danielle Hill, human resources compliance manager, Hampton Roads Transit

Danielle Hill, human resources compliance manager, Hampton Roads Transit

“The hardest thing,” Hill said, “was getting people to think this is a job we will be providing for employees, and making sure staff understood that even if the employee filed 10 claims previously, they were to treat it like their first claim.”

HRT’s loss control program also includes investigation of all injuries, aided by state-of-the-art video cameras inside and outside all buses. Supervisors take statements by the end of the employee’s shift, and travel to the accident scene to take photos.

Safety training also blends into HRT’s return-to-work program, which saw decreased lost-time claims from 53 in 2011 to just 1 in 2015. The agency’s total incurred costs per claim decreased from $17,036 to $3,780.

Light Duty Works

Its light-duty program is one of the keys to the overall program’s success.

“That’s been really great,” Hill said. “I think when managers thought ‘light duty,’ they didn’t understand what it meant. I told them, ‘You can have somebody on workers’ comp do administrative work for you.’

“It helps us to get injured workers into a job they can do and it helps that department fulfill a need that otherwise they might have to pay overtime to complete.”

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Every October, the agency invites its workers’ compensation team to an open house to review the light-duty program and gain a greater understanding of HRT’s job requirements, including an update on job descriptions for light duty.

The event includes a tour of the facilities and operations, and bus rides for a close-up look at the work employees perform.

“That is integral,” said Wilson of PMA. It gives the doctors an accurate view of employee tasks and movements so they can better understand injuries, he said.

Wellness programs are also a key part of the initiative. To prevent injuries from occurring, HRT hosts three health fairs a year, with nutritionist consultations and biometric testing. HRT also is working with physical therapists to provide stretching exercises drivers can do while on the bus as well as exercises for before and after work.

“The best thing is we are all together and on the same page,” Hill said. “Everybody respects the program. We are all on the same side, working on the same goal.” &

_______________________________________________________

Read more about the 2016 Teddy Award winners:

target-150x150Bringing Focus to Broad Challenges: Target brings home a 2016 Teddy Award for serving as an advocate for its workers, pre- and post-injury, across each of its many operations.

 

hrt-150x150The Road to Success: Accountability and collaboration turned Hampton Roads Transit’s legacy workers’ compensation program into a triumph.

 

excela-150x150Improve the Well-Being of Every Life: Excela Health changed the way it treated injuries and took a proactive approach to safety, drastically reducing workers’ comp claims and costs.

 

harder-150x150The Family That’s Safe Together: An unwavering commitment to zero lost time is just one way that Harder Mechanical Contractors protects the lives and livelihoods of its workers.


More coverage of the 2016 Teddy Awards:

Recognizing Excellence: The judges of the 2016 Teddy Awards reflect on what they learned, and on the value of awards programs in the workers’ comp space.

Fit for Duty: 2013 Teddy Winner Miami-Dade County Public Schools is managing comorbid risk factors by getting employees excited about healthy living.

Saving Time and Money: Applying Lean Six Sigma to its workers’ comp processes earned Atlantic Health a Teddy Award Honorable Mention.

Caring for the Caregivers: Adventist Health Central Valley Network is achieving stellar results by targeting its toughest challenges.

Advocating for Injured Workers: By helping employees navigate through the workers’ comp system, Cottage Health decreased lost work days by 80 percent.

A Matter of Trust: St. Luke’s workers’ comp program is built upon relationships and a commitment to care for those who care for patients.

Keeping the Results Flowing: R&I recognizes the Metropolitan Water Reclamation District of Greater Chicago for a commonsense approach that’s netting continuous improvement.

Anne Freedman is managing editor of Risk & Insurance. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Exclusive | Hank Greenberg on China Trade, Starr’s Rapid Growth and 100th, Spitzer, Schneiderman and More

In a robust and frank conversation, the insurance legend provides unique insights into global trade, his past battles and what the future holds for the industry and his company.
By: | October 12, 2018 • 12 min read

In 1960, Maurice “Hank” Greenberg was hired as a vice president of C.V. Starr & Co. At age 35, he had already accomplished a great deal.

He served his country as part of the Allied Forces that stormed the beaches at Normandy and liberated the Nazi death camps. He fought again during the Korean War, earning a Bronze Star. He held a law degree from New York Law School.

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Now he was ready to make his mark on the business world.

Even C.V. Starr himself — who hired Mr. Greenberg and later hand-picked him as the successor to the company he founded in Shanghai in 1919 — could not have imagined what a mark it would be.

Mr. Greenberg began to build AIG as a Starr subsidiary, then in 1969, he took it public. The company would, at its peak, achieve a market cap of some $180 billion and cement its place as the largest insurance and financial services company in history.

This month, Mr. Greenberg travels to China to celebrate the 100th anniversary of C.V. Starr & Co. That visit occurs at a prickly time in U.S.-Sino relations, as the Trump administration levies tariffs on hundreds of billions of dollars in Chinese goods and China retaliates.

In September, Risk & Insurance® sat down with Mr. Greenberg in his Park Avenue office to hear his thoughts on the centennial of C.V. Starr, the dynamics of U.S. trade relationships with China and the future of the U.S. insurance industry as it faces the challenges of technology development and talent recruitment and retention, among many others. What follows is an edited transcript of that discussion.


R&I: One hundred years is quite an impressive milestone for any company. Celebrating the anniversary in China signifies the importance and longevity of that relationship. Can you tell us more about C.V. Starr’s history with China?

Hank Greenberg: We have a long history in China. I first went there in 1975. There was little there, but I had business throughout Asia, and I stopped there all the time. I’d stop there a couple of times a year and build relationships.

When I first started visiting China, there was only one state-owned insurance company there, PICC (the People’s Insurance Company of China); it was tiny at the time. We helped them to grow.

I also received the first foreign life insurance license in China, for AIA (The American International Assurance Co.). To date, there has been no other foreign life insurance company in China. It took me 20 years of hard work to get that license.

We also introduced an agency system in China. They had none. Their life company employees would get a salary whether they sold something or not. With the agency system of course you get paid a commission if you sell something. Once that agency system was installed, it went on to create more than a million jobs.

R&I: So Starr’s success has meant success for the Chinese insurance industry as well.

Hank Greenberg: That’s partly why we’re going to be celebrating that anniversary there next month. That celebration will occur alongside that of IBLAC (International Business Leaders’ Advisory Council), an international business advisory group that was put together when Zhu Rongji was the mayor of Shanghai [Zhu is since retired from public life]. He asked me to start that to attract foreign companies to invest in Shanghai.

“It turns out that it is harder [for China] to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

Shanghai and China in general were just coming out of the doldrums then; there was a lack of foreign investment. Zhu asked me to chair IBLAC and to help get it started, which I did. I served as chairman of that group for a couple of terms. I am still a part of that board, and it will be celebrating its 30th anniversary along with our 100th anniversary.

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We have a good relationship with China, and we’re candid as you can tell from the op-ed I published in the Wall Street Journal. I’m told that my op-ed was received quite well in China, by both Chinese companies and foreign companies doing business there.

On August 29, Mr. Greenberg published an opinion piece in the WSJ reminding Chinese leaders of the productive history of U.S.-Sino relations and suggesting that Chinese leaders take pragmatic steps to ease trade tensions with the U.S.

R&I: What’s your outlook on current trade relations between the U.S. and China?

Hank Greenberg: As to the current environment, when you are in negotiations, every leader negotiates differently.

President Trump is negotiating based on his well-known approach. What’s different now is that President Xi (Jinping, General Secretary of the Communist Party of China) made himself the emperor. All the past presidents in China before the revolution had two terms. He’s there for life, which makes things much more difficult.

R&I: Sure does. You’ve got a one- or two-term president talking to somebody who can wait it out. It’s definitely unique.

Hank Greenberg: So, clearly a lot of change is going on in China. Some of it is good. But as I said in the op-ed, China needs to be treated like the second largest economy in the world, which it is. And it will be the number one economy in the world in not too many years. That means that you can’t use the same terms of trade that you did 25 or 30 years ago.

They want to have access to our market and other markets. Fine, but you have to have reciprocity, and they have not been very good at that.

R&I: What stands in the way of that happening?

Hank Greenberg: I think there are several substantial challenges. One, their structure makes it very difficult. They have a senior official, a regulator, who runs a division within the government for insurance. He keeps that job as long as he does what leadership wants him to do. He may not be sure what they want him to do.

For example, the president made a speech many months ago saying they are going to open up banking, insurance and a couple of additional sectors to foreign investment; nothing happened.

The reason was that the head of that division got changed. A new administrator came in who was not sure what the president wanted so he did nothing. Time went on and the international community said, “Wait a minute, you promised that you were going to do that and you didn’t do that.”

So the structure is such that it is very difficult. China can’t react as fast as it should. That will change, but it is going to take time.

R&I: That’s interesting, because during the financial crisis in 2008 there was talk that China, given their more centralized authority, could react more quickly, not less quickly.

Hank Greenberg: It turns out that it is harder to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.

R&I: Obviously, you have a very unique perspective and experience in China. For American companies coming to China, what are some of the current challenges?

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Hank Greenberg: Well, they very much want to do business in China. That’s due to the sheer size of the country, at 1.4 billion people. It’s a very big market and not just for insurance companies. It’s a whole range of companies that would like to have access to China as easily as Chinese companies have access to the United States. As I said previously, that has to be resolved.

It’s not going to be easy, because China has a history of not being treated well by other countries. The U.S. has been pretty good in that way. We haven’t taken advantage of China.

R&I: Your op-ed was very enlightening on that topic.

Hank Greenberg: President Xi wants to rebuild the “middle kingdom,” to what China was, a great country. Part of that was his takeover of the South China Sea rock islands during the Obama Administration; we did nothing. It’s a little late now to try and do something. They promised they would never militarize those islands. Then they did. That’s a real problem in Southern Asia. The other countries in that region are not happy about that.

R&I: One thing that has differentiated your company is that it is not a public company, and it is not a mutual company. We think you’re the only large insurance company with that structure at that scale. What advantages does that give you?

Hank Greenberg: Two things. First of all, we’re more than an insurance company. We have the traditional investment unit with the insurance company. Then we have a separate investment unit that we started, which is very successful. So we have a source of income that is diverse. We don’t have to underwrite business that is going to lose a lot of money. Not knowingly anyway.

R&I: And that’s because you are a private company?

Hank Greenberg: Yes. We attract a different type of person in a private company.

R&I: Do you think that enables you to react more quickly?

Hank Greenberg: Absolutely. When we left AIG there were three of us. Myself, Howie Smith and Ed Matthews. Howie used to run the internal financials and Ed Matthews was the investment guy coming out of Morgan Stanley when I was putting AIG together. We started with three people and now we have 3,500 and growing.

“I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

R&I:  You being forced to leave AIG in 2005 really was an injustice, by the way. AIG wouldn’t have been in the position it was in 2008 if you had still been there.

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Hank Greenberg: Absolutely not. We had all the right things in place. We met with the financial services division once a day every day to make sure they stuck to what they were supposed to do. Even Hank Paulson, the Secretary of Treasury, sat on the stand during my trial and said that if I’d been at the company, it would not have imploded the way it did.

R&I: And that fateful decision the AIG board made really affected the course of the country.

Hank Greenberg: So many people lost all of their net worth. The new management was taking on billions of dollars’ worth of risk with no collateral. They had decimated the internal risk management controls. And the government takeover of the company when the financial crisis blew up was grossly unfair.

From the time it went public, AIG’s value had increased from $300 million to $180 billion. Thanks to Eliot Spitzer, it’s now worth a fraction of that. His was a gross misuse of the Martin Act. It gives the Attorney General the power to investigate without probable cause and bring fraud charges without having to prove intent. Only in New York does the law grant the AG that much power.

R&I: It’s especially frustrating when you consider the quality of his own character, and the scandal he was involved in.

In early 2008, Spitzer was caught on a federal wiretap arranging a meeting with a prostitute at a Washington Hotel and resigned shortly thereafter.

Hank Greenberg: Yes. And it’s been successive. Look at Eric Schneiderman. He resigned earlier this year when it came out that he had abused several women. And this was after he came out so strongly against other men accused of the same thing. To me it demonstrates hypocrisy and abuse of power.

Schneiderman followed in Spitzer’s footsteps in leveraging the Martin Act against numerous corporations to generate multi-billion dollar settlements.

R&I: Starr, however, continues to thrive. You said you’re at 3,500 people and still growing. As you continue to expand, how do you deal with the challenge of attracting talent?

Hank Greenberg: We did something last week.

On September 16th, St. John’s University announced the largest gift in its 148-year history. The Starr Foundation donated $15 million to the school, establishing the Maurice R. Greenberg Leadership Initiative at St. John’s School of Risk Management, Insurance and Actuarial Science.

Hank Greenberg: We have recruited from St. John’s for many, many years. These are young people who want to be in the insurance industry. They don’t get into it by accident. They study to become proficient in this and we have recruited some very qualified individuals from that school. But we also recruit from many other universities. On the investment side, outside of the insurance industry, we also recruit from Wall Street.

R&I: We’re very interested in how you and other leaders in this industry view technology and how they’re going to use it.

Hank Greenberg: I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.

R&I: So as the pre-eminent leader of the insurance industry, what do you see in terms of where insurance is now an where it’s going?

Hank Greenberg: The country and the world will always need insurance. That doesn’t mean that what we have today is what we’re going to have 25 years from now.

How quickly the change comes and how far it will go will depend on individual companies and individual countries. Some will be more brave than others. But change will take place, there is no doubt about it.

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More will go on in space, there is no question about that. We’re involved in it right now as an insurance company, and it will get broader.

One of the things you have to worry about is it’s now a nuclear world. It’s a more dangerous world. And again, we have to find some way to deal with that.

So, change is inevitable. You need people who can deal with change.

R&I:  Is there anything else, Mr. Greenberg, you want to comment on?

Hank Greenberg: I think I’ve covered it. &

The R&I Editorial Team can be reached at [email protected]