|
NEWSLETTERS
NEWSLETTERS
| |
561-683-8383
October 2008 |
|
In this issue
|
| • |
Case Study: Metal Fabricator Saves $40,000
|
| • |
The Startling Truth About Workers' Compensation and Declines in Claim Frequency
|
| • |
Changing employee behavior key to controlling injuries
|
|
Case Study: Metal Fabricator Saves $40,000
|
Insured
A metal fabricator with annual revenues of $2,800,000 and 26 employees. The company manufactures metal sign-holders for various retailers.
Situation
With no history of carpel tunnels issues, the insured experienced a rash of carpel tunnel injuries unexpectedly, with two in excess of $80,000. This drove the companys Experience Mod up to 1.72 and resulted in the policy being canceled by their Workers Comp carrier.
Assessment
The first claim was a legitimate case and the employee required medical attention and physical rehabilitation. The following claims occurred so rapidly that they were deemed questionable. There was also no clear language in place in the employee manual to address the situation.
Solution
After a detailed analysis, the Certified WorkComp Advisors (CWCA) designed and implemented a detailed and specific plan of action. The insureds Return-to-Work program was replaced with a proper Recovery-at-Work plan and the outdated manual was rewritten. Injured workers were assigned appropriate light duty. The CWCAs conducted educational courses for medical providers, who previously had minimum knowledge of workplace injuries, Finally, the insured was placed with a carrier who more fully understood Workers Compensation procedures.
Result
The first injury, a 57-year old woman who had to have both wrists medically treated, returned to work through the Recovery-at-Work program, and the claim remained a medical only claim. This saved the company over $40,000, and an estimated .40 points on its Experience Mod. Further declines in the Mod are expected as a result of the improved injury management practices.
|
|
The Startling Truth About Workers' Compensation and Declines in Claim Frequency
|
A startling 69% of injuries and illnesses may never make it into the BLS Survey of Occupational Injuries and Illnesses (SOII), the nations annual workplace safety and health "report card." The chronic and even gross underreporting of work-related injuries is among the most troubling conclusions in Hidden Tragedy: Underreporting of Workplace Injuries and Illnesses, a majority staff report by the Committee on Education and Labor, US House of Representatives.
These findings have profound implications for Workers Compensation. For more than a decade, declining claims frequency has been celebrated as a major force in reigning in the costs of Workers Compensation. While the economic shift from manufacturing to services reduced injury exposure, stepped up injury prevention efforts by employers and increased awareness of the benefits of expeditiously returning injured employees to work were heralded as major contributors to the declining rates.
Underreporting, however, distorts the factual basis and casts serious doubt on the validity of the data that drives decision-making. Annual reports of dramatic declines in claims frequency for the past decade have lulled employers into a false sense of security: were doing an outstanding job by consistently lowering the incidence of injuries and illnesses, our programs are working, and we have properly allocated our resources on preventive health and safety measures. Contrarily the Hidden Tragedy concludes, the "SOII cannot be trusted as a gauge of the safety of American workplaces."
There are many reasons for underreporting and some, such as the exclusion of public employees and lack of understanding of reporting requirements, can be addressed with improved recordkeeping and training. Others such as occupational illnesses that have a long latency period (time between exposure and disease) are more difficult and will require investment in comprehensive health data collection systems. Yet, the one that is most worrisome is that both employers and employees underreport injuries and illnesses, compelled by economic or peer pressures.
Recognizing that OSHA relies on self-reporting, employers face strong incentives to underreport. Increasingly, injury and illness rates are used as evaluation criteria in the award of government and private contracts and bonuses; lower rates improve a bidders chances. Businesses with fewer injuries are less likely to be inspected by OSHA, will have lower Experience Mods and look better to stockholders and consumers.
Furthermore, it is likely the level of underreporting is indicative of the employers safety culture and affects an employees willingness to report an injury. There are many reasons an employee might decide not to file a claim, ranging from fear of reprisal and peer pressure to a lack of understanding of the compensation system. Sometimes there is the belief that the injury is not work-related. Nevertheless, it is clear that the employers behavior is a key determinant in a workers decision to file.
Widespread reports of employee harassment and intimidation are cited in the report, including a heart wrenching account in the Charlotte Observer about poultry workers who were disciplined, harassed and fired for reporting injuries. Other tactics used to discourage reporting include bringing seriously injured workers right back to work to avoid lost work-time and discouraging appropriate medical care, including pressuring physicians, to avoid a treatment plan that precipitates an OSHA Recordable injury.
The problem is even more complex for immigrant workers who face language barriers, as well as fear of job loss or deportation, if undocumented. Although the death rate among Hispanics in construction is much higher than that for the rest of the industry, the work-related injury rate is lower. This trend defies logic, however it reflects the fact that fatalities are difficult to hide.
Whereas a moral appeal may not dissuade employers who habitually underreport and abuse the system, employers should be compelled by the economic hazard in underreporting. In many ways, the practice is a disaster waiting to happen, akin to the perverse logic that drove the subprime mortgage collapse.
One of the overarching principles of Workers Comp cost control is early reporting and intervention. The definitive study, prepared by the Hartford Financial Services Group, found that injuries reported between the 4th and 5th week following an injury are 45% more expensive than those reported in the first week. Moreover, delayed reporting significantly increases the likelihood of litigations, further compounding the costs.
As a case in point, studies have also found significant underreporting in musculoskeletal disorders (MSDs), the common soft tissue workplace injury. Yet the probability of reporting increases with the severity of the condition. As the injury remains untreated, it becomes unbearable, a claim is filed, treatment is extensive and the costs exorbitant. It simply does not pay to underreport. One late report can cost significantly more than five timely reports.
Current data reveals that the costs and severity of claims are rising. While there are many reasons for the rising costs, its easy to postulate that underreporting can be a contributing factor. The right medical attention, delivered most expeditiously, is the best way to help employees recover faster and, ultimately, is the most economically sound approach for employers.
Not all employers are guilty of willful underreporting. Even in companies where management takes a constructive, proactive approach to injury prevention, their actions may unwittingly discourage reporting. Employers often provide monetary incentives (safety bonus and award programs) to workers to increase safety awareness on the job and reduce workplace injuries and illnesses.
When the program significantly rewards a reduction in or zero recordable injuries, the focus becomes the reward rather than safety. Workers who incur injuries may suffer pejorative and disparaging treatment from peers or supervisors when they jeopardize the reward or bonus.
To counteract this problem, employers must evaluate what they are measuring and rewarding. Identifying close calls and taking corrective action, time lags in reporting, disability duration and treatment conforming to evidence-based guidelines, equipment maintenance, training, and supervisor support and implementation of carefully structured Return-to-Work programs are better benchmarks.
Responsible employers are guided by injury and illness statistics in designing and implementing workplace health and safety programs, and if employers are not fully aware of the events that occur in their workplace, preventive efforts become less of a priority. Supervisors need to be held accountable and rewarded for accurate recordkeeping and prompt injury reporting. Turn the no-report culture on its head to 'if you get hurt, we want to know immediately.'
There is little doubt that the current method of reporting is flawed. We dont really know what is happening with workplace injury trends, but we do know that the trends are not as good as they seem. Over the long term we can work for improvements in the reliability and source of data. Yet, our most important task is to convey that the biggest threat of underreporting is really to the economic health of the employer. |
|
Changing employee behavior key to controlling injuries
|
A worker in a machine shop in Illinois is injured when a conveyor belt snaps and strikes him in the face. On the surface, this appears to be a common workplace injury, especially in an environment where belts and pulleys are moving at high speed.
But you may be surprised to learn that it is more likely, even 20 times more likely, that the same worker heads out on injured leave by twisting his back bending down to pick up his tool box, or slipping on a wet floor due to anything from an oil leak to condensation from a large Dunkin Donuts iced coffee.
According to a study conducted by DuPont on all accidents the company experienced over a 10-year period, 96% were due to unsafe actions by employees who were going beyond their limits, rather than unsafe conditions. Meaning, trying to pick up a 400-pound piece of machinery all by yourself wasnt such a good idea after all.
A 2006 Liberty Mutual Workplace Safety Study backs up this data with findings that show more than 50% of all workplace injuries are a result of overexertion, falls, twisting the wrong way, etc.--resulting in estimated annual Workers Compensation costs of just over $46 billion.
What we have is the perfect storm, where the number-one cause of workplace injuryoverexertion resulting in hard to diagnose and equally hard to treat muscular-skeletal sprains and strainsis the number-one most costly of injuries. So, what can be done to reverse the trend?
On the surface, it would seem that the most likely place to turn would be OSHA, which for the past 30 years has been the guardian when it comes to workplace safety. Although there has been a strong increase in the awareness of making the workplace safer, OSHAs focus hasnt been on the behavioral aspects of the job. It is all about compliance and findings; in short, its harder to change behavior than it is to change a facility, and easier to fix a faulty piece of machinery than it is to convince a worker not to try to move it.
Perhaps one of the main reasons employers have not been more aggressive in trying to get OSHA involved is that business owners are skeptical when someone says, "Im from the government, and Im here to help." The fear is that once they are invited in, they wont leave
and once theyre in, what will they find?
It makes more sense for business-owners to take the initiative themselves through performance appraisals, starting with front line supervisors who need to make sure injury prevention is part of the overall workplace scorecard. Supervisors need to raise awareness among the rank and file to work as a team, and to look after one another. Its extremely important that workers understand and support the policies put in place, all with the immediate goal of workplace safety.
This teamwork can also generate incentive programs, above and beyond the obvious number-one incentive of avoiding injuries on the job. All should share in reaping the rewards of a safe workplace, whether its a certificate on a wall, a pin on a uniform, or a cookout at the end of the summer. By replacing the "us vs. them" mentality that can often fester on the job into a "were all in this together" credo, major steps have been made to keep workers healthy and on the job.
But that having been said, at the end of the day, it still starts with hiring the right people for the right job, and giving them the needed education and training to do the job properly and safely within their limits.
By doing so, the added rewards can include lower premiums, increased workplace safety, fewer injury-related absences, and even inclusion in OSHAs SHARP Program. The Safety and Health Achievement Recognition Program (SHARP) recognizes small employers who operate an exemplary safety and health management system. Acceptance into SHARP by OSHA singles out a company as a model for worksite safety and health. Once a company receives the SHARP recognition, its worksite is exempt from programmed inspections during the period that the SHARP certification is valid.
Human behavior is hard to change. Millions of years ago, some guy in a cave saw a big rock and said to himself, "I can pick that up, no problem." Next thing you know, he throws out his back, cant outrun a T-Rex, and
well, you know how that ended. But in todays workplace, with the proper training and front-line supervisors at the top of their game, supported by the workers around them who know their limits, injuries can be avoided.
|
Ten Commandments for Managing an OSHA visit
|
1. I need to know my legal rights and be ready.
2. Ill appoint and train one person or a team to handle government investigations.
3. Before I permit access, Ill check inspectors credentials.
4. Before inspection begins, Ill be clear why the inspector is visiting. If not clear, Ill dig deeper until Im satisfied why the inspector is visiting.
5. Ill be totally professional, no hostile behavior.
6. Ill never, ever permit an inspector to go through my facility unaccompanied. Ill have at least two company employees to accompany the inspector, one to take notes and the other to listen.
7. Ill video the inspection. If I cant video, Ill audiotape and take the same measurements and photographs inspector takes. Ill keep thorough and complete notes.
8. Like an IRS audit, Ill not volunteer anything. Ill only answer what is asked and give only requested documents.
9. I wont give inspector documents the law says I dont have to unless Im convinced the reasons are valid.
10. At the closing conference, Ill obtain information, but offer no additional information.
|
|
Previous Newsletters
May-2009
Apr-2009
Mar-2009
Feb-2009
Jan-2009
Dec-2008
Nov-2008
Oct-2008
Sep-2008
Aug-2008
Jul-2008
Jun-2008
May-2008
Apr-2008
Mar-2008
Feb-2008
Jan-2008
Dec-2007
Nov-2007
Oct-2007
Sep-2007
Aug-2007
Jul-2007
Jun-2007
May-2007
Apr-2007
Mar-2007
Feb-2007
Jan-2007
Dec-2006
Nov-2006
Oct-2006
Sep-2006
Aug-2006
Jul-2006
Jun-2006
May-2006
Apr-2006
Mar-2006
Feb-2006
Jan-2006
|
