What You Need to Know About the Year Ahead in Workers’ Comp

Political shifts, ACOs, soft skills, the sharing economy and more are on the radar for the workers' comp industry in 2019.
By: | January 15, 2019 • 4 min read

Out Front Ideas with Kimberly and Mark hosted its annual “20 Issues to Watch” webinar on January 8th, preparing participants for a busy 2019 in the world of workers’ compensation and employee benefits.

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The webinar series, sponsored by ​Sedgwick​ and ​Safety National​, features industry vets Kimberly George, senior vice president of Corporate Development, M&A and Healthcare at Sedgwick Claims Management Services Inc.; and Mark Walls, Vice President of Communications & Strategic Analysis with Safety National.

Of the 20 issues identified, many had links to the expanding role of workers’ compensation and employee benefits as they relate to claims management and customer service. The key takeaway: in an increasingly globalized economy, employers should expect work and workers to reach higher levels of connectedness.

A significant chunk of the discussion centered around political considerations as we approach the 2020 elections and as several states saw gubernatorial and/or party majority changes in 2018. While George noted that, “with a divided Congress, it will be near impossible for any major health reform to come out of Washington,” she urged the industry to stay vigilant, as health care will likely reprise its role as a central platform component nationally and locally in 2020.

Kimberly George
senior vice president, corporate development, M&A, and healthcare, Sedgwick

“The ACA is alive and well,” she said, and Medicaid expansion is a reality in all but 14 states. George also predicted a continued rise in accountable care organizations (ACOs) outside of the Medicare value-based care system and an employer medical cost trend of about six percent.

On the other hand, in state legislatures, the picture is blurry. Walls identified eight states that saw gubernatorial party shifts: Alaska, Illinois, Kansas, Maine, Michigan, Nevada, New Mexico and Wisconsin. “Many people do not appreciate [that] governors can affect workers’ comp,” he said. “Those changes can result in new regulators and administrative law judges.”

Further, Walls cited uncertainty in California health policy under new Governor Gavin Newsom, Alabama’s effort to overhaul its system in the wake of an unconstitutionality ruling, and talk of a medical benefits cap in Mississippi as state issues to watch.

Treating the Whole Person

George delineated a series of other topics that in effect broaden services for injured workers and health plan beneficiaries, including: the psychology of pain, social determinants of health, leave of absence, unconscious bias in claims handling and consumer experience.

Particularly on the psychology of pain and social determinants of health, George emphasized that payers can expect to gain a significant return on investment from treating the whole person, as opposed to providing minimal care.

Mark Walls, vice president of communications and strategic analysis, Safety National

She gave the example of a man who suffered third-degree burns on 90 percent of his body and had dirt floors in his home. Although the claim did not ​require​ alternative housing and food delivery services, the ​outcome​ was likely much better because of those additional services. “He actually fought against being labelled permanent and total,” George said.

In the same vein, Walls and George predict 2019 will continue to drive home “family friendliness” for leave in the workplace, and soft skills leadership in claims handling.

“Our industry is experiencing an unprecedented level of turnover due to the aging workforce,” George explained. “Soft skills training will become more important as the next generation of claims management becomes a reality.”

“Our industry is experiencing an unprecedented level of turnover due to the aging workforce. Soft skills training will become more important as the next generation of claims management becomes a reality.” — Kimberly George, senior vice president, corporate development, M&A, and healthcare, Sedgwick

Part of this soft skills training involves awareness of unconscious bias, and taking it a step further, intercepting that unconscious bias, which could involve formal intervention.

Economic and Social Shifts

On a broader front, George and Walls addressed the economy’s impact on workers’ comp, including the sharing economy and its attendant employee classification woes.

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Walls cautioned that while it may seem as though increasing employment and wages across the country would increase payroll and therefore premiums, “some carriers are seeing an uptick in frequency” due to this increase.

He attributed the frequency changes to workers entering jobs in poor physical condition or without the appropriate training. Compounding this probable increase in frequency is the rise in “mega claims” upwards of $5 million.

The drumbeat of recreational marijuana legalization in a growing number of states is likely to remain on the radar for 2019, as well as battles over the AMA 6th Edition’s impairment guidelines in states that have chosen to update from the more liberal 5th edition, according to Walls and George.

Out Front Ideas will host webinars on several of the topics mentioned in its “Issues to Watch” episode later this year, including: the intersection of leave of absence policies with workers’ comp, globalization of risk management and measuring success. &

Nina Luckman is a business journalist based in New Orleans, focusing primarily on the workers' compensation industry. She holds a B.A. and an M.A. in English Literature from Tulane University. She can be reached at [email protected]

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]